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View Full Version : Economic: The elimination of the "safety net"




Just Flossin'
02-20-2012, 10:34 AM
I feel like besides foreign policy, most would-be Paul supporters or people that at least have an open mind to consider Paul, are fearful of elimination of the government safety nets - unemployment, food stamps, etc. I take it the federal government would be out of this business under President Paul, but states could offer these services if they wished. That being said, how can I address people's fears that it'll be everybody for themselves and what's to prevent states from raising state income taxes to 50-60% of a person's salary to cover social services or to compensate for money they no longer receive from the federal government?

Also, without labor laws, what would prevent mega-corporations that are responsible for large chunks of employment numbers (Walmart, Target, Home Depot, etc.) from saying $5 an hour across the board is the new salary for all employees. If there isn't regulation to the contrary, couldn't these mega corporations set the rules and given their size, make it virtually impossible for any alternatives?

Travlyr
02-20-2012, 10:47 AM
One thing you can tell them is that each predator drone costs $100,800,000.00. When we stop warring on the world, then we'll have to buy quite a few less drones and $100.00 hammers for the military industrial complex. So everybody will be quite a bit richer just through tax reductions. That's just the start.

newbitech
02-20-2012, 10:50 AM
I feel like besides foreign policy, most would-be Paul supporters or people that at least have an open mind to consider Paul, are fearful of elimination of the government safety nets - unemployment, food stamps, etc. I take it the federal government would be out of this business under President Paul, but states could offer these services if they wished. That being said, how can I address people's fears that it'll be everybody for themselves and what's to prevent states from raising state income taxes to 50-60% of a person's salary to cover social services or to compensate for money they no longer receive from the federal government?

Also, without labor laws, what would prevent mega-corporations that are responsible for large chunks of employment numbers (Walmart, Target, Home Depot, etc.) from saying $5 an hour across the board is the new salary for all employees. If there isn't regulation to the contrary, couldn't these mega corporations set the rules and given their size, make it virtually impossible for any alternatives?

These are good questions.

First I would have to say that under the current system, this is already happening. I could use myself as an example. Without getting in to gory details of my personal experience, I think it is important to understand a couple of things.

1.) Irrational Fear - People are afraid to create their own personal safety nets, when in reality the collectivist safety nets provide a false sense of security and in many cases actually prevent individuals from creating their own personal safety net.
2.) Limited Government doesn't stop with reigning in the largest offenders.
3.) The more localized the government, the more efficient the government, all the way down to individual self-government.
4.) Specifically, hiring cheap labor gives you cheap products. At least the market will set the wages. You might be removing the easy to see floor on wages, but you'll also be removing the not so easy to see ceiling in wages as well. This would amount to a more equitable distribution of capital based on merit instead of being based on navigating the legal structures of business.
5.) So instead of having older skilled people taking on jobs that should be there for younger people to gain experience, we filter job skills through carefully crafted business schemes designed to avoid costly litigation and end up paying too much for unskilled work and squandering skilled work on the sidelines as the market is prevented from adjusting to changing technologies and new innovations. ( that is a very hard point to make in a few words. I tried =))

CaptUSA
02-20-2012, 10:55 AM
The problem with a safety net is that it's not just the people who want one that get entangled in it.

Eventually, they create more harm than good. Still, the better way to manage a safety net, if people want to have one, is to manage it as close to the people as possible. This means, getting it away from the federal government. Getting it away from state governments. Either make it local government or local charities. They will paint the picture that life before safety nets was horrible, but nothing has really changed in the benefits received. The only difference is the abuse and the trap.

As for Walmart, you need to grab a bigger picture of economics. If Walmart were to cut the rates of their employees and could still find labor, then we'd all be better off since the prices they'd charge would be even lower. Thereby making the entire community richer and creating more opportunity.

The Gold Standard
02-21-2012, 01:09 PM
There are a lot of problems with the welfare state that we can debate, but all you need to tell them is that Ron Paul has no plans to take away the safety net. What you can be sure of though is that if we do not quit printing money at will and occupying most of the world, the safety net will be taken away by force because the government will either default on its obligations or pay them off with worthless money. If the existence of the safety net is important to you then there is only one candidate that will make sure we can afford to have one.

The Free Hornet
02-21-2012, 01:53 PM
I feel like besides foreign policy, most would-be Paul supporters or people that at least have an open mind to consider Paul, are fearful of elimination of the government safety nets - unemployment, food stamps, etc. I take it the federal government would be out of this business under President Paul, but states could offer these services if they wished. That being said, how can I address people's fears that it'll be everybody for themselves and what's to prevent states from raising state income taxes to 50-60% of a person's salary to cover social services or to compensate for money they no longer receive from the federal government?

If these things are important, people should fund their own unemployment insurance. Perhaps tax breaks could encourage the process but there is no reason any of these things should be publicly funded. All funds should be in accounts owned and controlled (within the contractual bounds of their creation) by the individual. How does unemployment insurance help the guy working 20 years straight who gets the same crappy benefits as the guy 2 months on the job?

The "safety net" is for the government workers and politicians. The rest of us pay a premium for a crappy, fraudulent, high-overhead system.


Also, without labor laws, what would prevent mega-corporations that are responsible for large chunks of employment numbers (Walmart, Target, Home Depot, etc.) from saying $5 an hour across the board is the new salary for all employees. If there isn't regulation to the contrary, couldn't these mega corporations set the rules and given their size, make it virtually impossible for any alternatives?

And so what if they did? When they lose the best of their employees, America will see the folly of the their ways. If we cut salaries, do we expect the BEST workers to put up with it? No! They are the first to leave. The deadweight will stick around and the productive ones will flee.

How is a low wage suddenly your boogieman? The bigger a corporation is, the harder it is for them to change. That is among their greatest weaknesses.

Mark37snj
02-21-2012, 02:13 PM
Unemployment Insurance and Social Security Disability Insurance are Insurance. We pay for them just like Health Insurance and Auto Insurance. They are not Free Safety Nets, they are Insurance we PAY for. If they want to eliminate them then they need to eliminate the taxes they collect for them and let the people keep their money. I personally want that Insurance and am willing to pay for it.

seraphson
02-21-2012, 03:14 PM
One thing you can tell them is that each predator drone costs $100,800,000.00. When we stop warring on the world, then we'll have to buy quite a few less drones and $100.00 hammers for the military industrial complex. So everybody will be quite a bit richer just through tax reductions. That's just the start.

This needs to be kept in mind. People's mindset just dips the big toe in the water. Of course if you discet just one aspect of Paul's politics it'll not work logically. You need to jump in the pool and have all the ideas work in tandem. As travlyr mentioned a TON of money would be transferred back to the people since they government will be substantially slimmed down. In regards to mega-corporations hiring cheap labor a truly FREE market economy will determine what every job is worth in terms of production and labor costs. Why should companies be forced to pay a minimum wage of $7.00 when really the job is only worth $4.50 an hour? Would you like to make $0 an hour because the business had to close down an extra spot due to minimum wage or would you mind working with a partner at $4.50 an hour? The same amount of labor gets done person by person whether they make $7.00 or $4.50 yet more positions open up and become fulfilled which decreases unemployment without the minimum wage. Without the minimum wage we actually might have more production in America again; but that can be argued and is a whole other thread.

tttppp
02-21-2012, 05:07 PM
I feel like besides foreign policy, most would-be Paul supporters or people that at least have an open mind to consider Paul, are fearful of elimination of the government safety nets - unemployment, food stamps, etc. I take it the federal government would be out of this business under President Paul, but states could offer these services if they wished. That being said, how can I address people's fears that it'll be everybody for themselves and what's to prevent states from raising state income taxes to 50-60% of a person's salary to cover social services or to compensate for money they no longer receive from the federal government?

Also, without labor laws, what would prevent mega-corporations that are responsible for large chunks of employment numbers (Walmart, Target, Home Depot, etc.) from saying $5 an hour across the board is the new salary for all employees. If there isn't regulation to the contrary, couldn't these mega corporations set the rules and given their size, make it virtually impossible for any alternatives?

With decreased regulations, there are increased competition which makes it difficult for corporations to screw people over.

thequietkid10
02-21-2012, 09:38 PM
Ok, lets suppose Walmart Target and several other big box stores get together and decide to cut wages overnight. Lets ask, what would happen.

1st off. Some people would quit, immediately, some may have a spouse who is making more money. Some may feel it's no longer worth their time to work there, and should look elsewhere. This would cause immediate labor shortages and major headaches for big box stores. What about those who stuck around. Well they would no longer be able to afford rent at the same price, food at the same price, ect, ect. So what do they do? Well they can either cut the price of these goods and rent, or there products will go unsold and there apartments won't be lived in. Or they can cut the price of goods for everyone, so they can afford it.

ronpaulhemp
02-26-2012, 01:05 PM
This is an interesting discussion, but bottom line: I agree with the guy above. The most relevant thing you can stress to people who bring the social safety net issue up is that Ron Paul's 'Plan to Restore America' cuts 1 trillion dollars in one year but not a penny of that comes from social safety net programs. The closest real proposal he's probably ever made to a cut in social security is the opt out program for young people. In reality, Ron Paul's the only presidential contender with a real plan to SAVE social security.

SkarnkaiLW
02-26-2012, 02:29 PM
In reply to Mark37snj, they call it insurance, but it is not. No business would ever run programs like the government does, because they are not sound from an actuary standpoint. They call them insurance and sell them like that because insurance companies (like State Farm, etc) were one of the few businesses that survived the Great Depression intact, and were trusted.

Paul Fan
02-26-2012, 03:25 PM
Unemployment Insurance and Social Security Disability Insurance are Insurance. We pay for them just like Health Insurance and Auto Insurance. They are not Free Safety Nets, they are Insurance we PAY for. If they want to eliminate them then they need to eliminate the taxes they collect for them and let the people keep their money. I personally want that Insurance and am willing to pay for it.

This is one of the big lies: they claim that welfare payments aren't forced redistribution of stolen funds, but just a service ('insurance'), so it is morally proper to force you to pay for this service you receive.

This is a lie and must be rejected. These 'services' aren't real services, because the 'beneficiaries'/'insurance payers' (ie taxpayers) don't get to choose whether to 'buy' the insurance, or who to buy it from, or what level to buy (high deductible-low cost, gold-plated high cost, etc.)

If you want insurance, get some from a non-profit mutual aid society. Then join in asking government to reduce your tax because you're already covered. The government won't agree to cut back until enough people are already covered elsewhere, because people don't want to jump into the dark. They need to see working models they can move to. That means you will have to pay twice for the insurance for a while. That is the price you must pay to teach by example.

TheFreeEconomy
03-02-2012, 10:18 PM
Like others in this thread have said, Ron Paul will not immediately cancel these social programs. He will cut wasteful overseas and domestic spending and usethose savings to continue funding these programs more those that are most dependent on them (ie. the elderly). Everyone who is below a cutoff age will have the option to opt out of it.

People should also realize that these programs such as Medicare and Social Security will end eventually. Either they can choose to have it slowly and deliberately phased out in order to soften the landing (as Ron Paul advocates) or keep going down the same path we have been taking and have the whole system come crashing down in the not so distant future.

Mark37snj
03-02-2012, 10:50 PM
In reply to Mark37snj, they call it insurance, but it is not. No business would ever run programs like the government does, because they are not sound from an actuary standpoint. They call them insurance and sell them like that because insurance companies (like State Farm, etc) were one of the few businesses that survived the Great Depression intact, and were trusted.


This is one of the big lies: they claim that welfare payments aren't forced redistribution of stolen funds, but just a service ('insurance'), so it is morally proper to force you to pay for this service you receive.

This is a lie and must be rejected. These 'services' aren't real services, because the 'beneficiaries'/'insurance payers' (ie taxpayers) don't get to choose whether to 'buy' the insurance, or who to buy it from, or what level to buy (high deductible-low cost, gold-plated high cost, etc.)

If you want insurance, get some from a non-profit mutual aid society. Then join in asking government to reduce your tax because you're already covered. The government won't agree to cut back until enough people are already covered elsewhere, because people don't want to jump into the dark. They need to see working models they can move to. That means you will have to pay twice for the insurance for a while. That is the price you must pay to teach by example.

I was not adressing any of that I was just noting that the insurance is, atleast partially, paid for - not Free Safety Nets, and I was not referring to Welfare. I made no claims that they completly balanced their books or fit any particular definition of what true insurance is. If they have to raise the premiums to balance the books I'm fine with that. You don't pay a tax for foodstamps, directly, like unemployment insurance. If they get rid of Welfare there is no tax that is abolished from your paycheck. My point was to show there is a difference between Free Safety Net and Paid Taxed Safety Net and if they abolish a service that they tax they should remove the tax, and if they want to keep it and/or need to raise the tax to balance the books I'm fine with that too. My post was to simply draw the distinction between a taxed service and an untaxed service in regards to paycheck witholdings and that you pay more for a taxed safety net then an untaxed one.