--- John Foster <[log in to unmask]> wrote:
> snip
> > > idea of trickle-down, giving govt. money to corporations and
> >
> >
> > Tricle down is a relatively new concept in politics.  It is
> something
> > that came up with Reagan in the late 70's early 80's.  Well
> unless
> > you count J. F. Kennedy (and a Democrat-that evil son of a bitch,
> > cutting taxes) and his tax cut.
>
> Trickle down is pretty new, but trickle up is not a new concept
> with
> Republican demagoges.
>
> >
> > > counting on
> > > them to stimulate the economy, was first done by Hoover, then
> > > Reagan.
> >
> > Well isn't that a nice bit of misrepresentation.  The idea is
> cutting
> > taxes will increase economic activity and in certain cases
> increase
> > government revenues.
>
> Cutting taxes may decrease economic activity. Especially if there
> is a world
> recession, high interest rates, or there is a lot of foreign
> ownership of
> the primary industries. Taxes are often spent more efficiently by

This is mainly an Enviro. Ethics list, and this discussion (while
interesting to me) is, IMO, way outside the purview of this list.
However, just let me say, that the above is not correct.  I can't
think of a single economic model in which taxes act as a positive
parameter with regards to output.


> responsible governments especially where there is universal public
> health
> care, utilities and infrastructures that require economies of scale
> which
> are too large for the private sector to operate.

Since governments are not usually governed by market forces the
validity of the above statement is definitely dubious.



> Private is not best nor worst; it is only one variant of ownership.
> A
> publically owned corporation can be just as efficient or more
> efficient than
> a private corporation simply because it does not *have* to maximize
> revenues
> and then try to hide the profits from the tax collecter (legally by
> buying
> other companies and assets which are in turn less efficient than
> the parent
> corporation). A public utility can focus on the business at hand
> and is not
> likely to be compelled to invest profits in 'non-core' areas, or
> speculate
> on risk taking ventures. This is all discussed in "The Peter
> Principle"
> which essentially suggests that increased revenues are eaten up by
> increased
> expenditures in corporations.
>
> The only really primary difference between communal or public
> ownership of a
> corporation and a private corporation is that the public
> corporation cannot
> be sold or traded since there are no shares floated or authorized.

Right, the public corporation is insulated from the constraints of
the market and hence have less incentive to efficient.  Further,
since many publicly owned corporations often become monopolies, these
corporations are by definition not efficient unless they engage in
marginal cost pricing.


> No one
> who is a citizen of a state can lose their ownership of the assets,
> and
> therefore there is permanent wealth creation that remains part of
> the public
> estate.

Funny, I don't seem to have a check book for writing checks against
the U.S. Treasury.  Hmmm, must just be an oversight.  If *I* can't
spend the money, then it is pretty much equivalent to me not having
the money, or at least not having a large chunck of it.


> The only solid argument put forth for hundreds of years against
> public
> ownership is one of efficiency, but no generalizations can support
> that
> private versus public models of efficiency hold up under careful
> analysis.

Except for places like the former Soviet Union, Eastern Block
countries, North Korea, etc.  While privately owned corporations are
not sufficient for a high standard of living, it does seem to be a
necessary condition.


> Which is to say that there are general circumstances which are
> often beyond
> the realm of the principle of ownership which function to make
> corporations
> efficient such as for example management policies and science. In
> the case
> of the northern atlantic cod example there was both private and
> public
> ownership of the processing and fishing industry. Neither form of
> ownership
> made any difference since the cod were depleted putting out of work
> approximately 80% of the population of northeast Newfoundland. The
> cause of
> the collapse was a combination of large trawlers and overfishing.
> Both
> models of government ownership (public) and private ownership
> failed to make
> the industry efficient since there was overfishing.

Ahhh, but who had the property rights to the fisheries?  If anybody
can buy a trawler and fish the cod, then yeah private ownership wont
help.  Property rights are incomplete and the market wont reach an
efficient outcome.  Interesting that the government didn't since it
is beyond market pressures and maximizing profits is not the end goal
of government entities.

This example has been brought up before.  The first time I saw it was
with a communal pasture and sheep.  The next time was a banana grove
and banana's.  In the case of communal ownership the resources were
overused right away.  The government solution was to act as a
gatekeeper.  The private property approach was to sell off the
communal resource to various individuals who then had no incentive to
overuse the resource.  Or so the text book examples went.

Steve


=====
"In a nutshell, he [Steve] is 100% unadulterated evil. I do not believe in a 'Satan', but this man is as close to 'the real McCoy' as they come."
--Jamey Lee West

__________________________________________________
Do You Yahoo!?
Check out Yahoo! Shopping and Yahoo! Auctions for all of
your unique holiday gifts! Buy at http://shopping.yahoo.com
or bid at http://auctions.yahoo.com