Tuesday, April 24, 2018

Greed and Social Mobility

RB and I were discussing Ayn Rand concepts and Social Mobility when MinnPost Ryan's Farewell fell of their front page. So here goes.
"My KISS interpretation of Randian beliefs. Different people have different beliefs and behaviors:
  1. Some are highly driven to learn, work, improve, create and to be independent
  2. Some are happy to do a solid days work for their pay.
  3. Some have lower ambitions and are happy to receive from others.
  4. Some are highly driven to try to con, steal or take from others.
Now you can deny this simple reality if you wish, however the first two categories are who make our country great. The second two categories are a drag on the country. The question is how to use social norms and government laws to push everyone into the first 2 categories?" G2A 
"Omitted from the List. 5. Our choice of behaviors, while in theory unlimited, is in practice circumscribed by factors out of our control." RB 
"Yeah I just don't see 5 making the list for American citizens.. We are all very lucky to live in America. I do agree that some choices are limited by the luck of birth, however given our free K-12 education system, welfare systems, job training programs, higher ed programs, extensive library systems, free internet access, family planning programs, etc.  
I am thinking each citizen is in large part responsible for their own choices, behaviors and results. We won't all become Jeff Bezos, however we should all be able to attain a nice family and reasonable income if we make solid choices, learn and work at it..
  1. Some are highly driven to learn, work, improve, create and to be independent
  2. Some are happy to do a solid days work for their pay.
  3. Some have lower ambitions and are happy to receive from others.
  4. Some are highly driven to try to con, steal or take from others.
  5. Our choice of behaviors, while in theory unlimited, is in practice circumscribed by factors out of our control." G2A
"The US ranks 13th in social mobility among OECD countries. That's behind all of Scandinavia, Finland, Canada, and Australia. We are, however, ahead of the United Kingdom, Italy, Chile, and Slovenia. We are behind countries that have a much stronger and more extensive system of public welfare (meaning, not just cash benefits) than the US does. 
Many years ago, I a guest at an "Engineers' Day" dinner put on by the employer of my then-current inamorata. The keynote speaker talked about the trends of the future. Afterwards, someone at our table remarked that what the man said was fine if you were a member of the Tucson Chamber of Commerce, but if you had been working for the last 20 years at Dodge Main, it wasn't so cool. "He's just told us that the blue collar middle class is on its way out." That seems to have happened. The blue collar middle class that was able to send its kids to a decent public university without having them accumulate mountains of debt is gone. It took with it an important part of upward mobility; namely, a parent's ability to make it so much easier. 
While individual choices are important, I don't think it's entirely possible to let late-stage capitalism entirely off the hook." RB 
"I agree that capitalism rewards those who are most effective, efficient and provide quality. And as I often say our American consumers are exclusively focused on features, quality, performance, personal value (ie cost), etc. 
Thus we reap what we sowed... We wanted more government benefits, regulations, easy immigration and lower cost products and services... And we got them. 
The consequence was jobs moving over seas and a glut of low end workers. Now what do you want to do to turn this around? " G2A
"You are putting too much blame on the American consumer, and on liberalism generally. 
What about technological advances, and greed? Let's say the owner of the Susquehanna Hat Company needs 10 sewing machine operators (median salary $24,000/yr.) to maintain production. If he installs the proper equipment, the whole shebang can be done by robotics, overseen by a single technician (median salary $57,000). How is that one going to pan out? If he saves money, is that going to result in lower prices, or are the prices going to stay the same, with shareholders reaping the difference? How many robotics technician jobs are going to be available for those who do the smart thing and retrain? 
I know how I'm betting. My example uses displacement of low-wage jobs because those were the ones I could think of offhand, but the same pattern is going to be replicated even in better paying professions (e.g. truck driving)." RB
 
RB, As I said... "capitalism rewards those who are most effective, efficient and provide quality" 
And American consumers are exclusively focused on features, quality, performance, personal value (ie cost), etc. And I will add one, people with IRAs / 401Ks / Pensions do not invest in funds that return lower than average. 
And these same "greedy" people will reward companies who offer good products for a good cost, and the companies who give them a higher rate of return. Now is that really "greed" or is it common sense? 
And they will punish companies that do not automate, off shore or do other things to remain competitive. And yes this going to be a big problem with limited knowledge, skills and/or flexibility. 
So back to my question... How do we make America be the most effective, efficient, trained, flexible and quality provider? Just making it more expensive to do business and invest in America certainly is problematic. 
I mean as I often note: many Americans don't "Buy American" even today.

1 comment:

John said...

NR Immigration and Child Poverty

OECD Mobility Discussion

This seems related to our child placement discussion.

"Inequality in learning opportunities begins at birth, and often widens as individuals grow older. Disparities in families’ capacity to support their children (including by getting them into good schools) continue to translate into differences in children’s achievements. Children from more affluent families tend to develop better skills in reading and problem-solving, are less likely to drop out of school without a diploma, and are more likely to complete tertiary education.

An early learning gap is already apparent when looking at four and five-years-old children. In the United States, children with poorly educated parents (upper secondary education attainment or less) lag significantly behind in reading and mathematics in comparison to their peers with highly educated parents(tertiary education or higher). A similar pattern, though to a much lesser degree, exists in Australia, Canada and the UK (Figure 4). It is interesting to note that the substantial gap in children’s learning outcomes is also found between children with high and medium socio-economic status within all four countries. Children from the highest socio-economic status families are more likely to benefit from abundant household resources such as quality learning environments in countries where the income distribution is highly skewed towards the top. On the other hand, middle-class children may struggle to prepare for school. Their parents work longer hours and have relatively higher household expenditures since they are not always entitled to the government support and childcare services that are typically targeted at low-income families. This suggests that public policy attention needs to be given to children from the lowest socio-economic status families, but also to children from the middle status families in order to prepare them for school entry."