Of course, but surely those public workers aren't the only reason California is in trouble. They must be wasting money everywhere. Health care must be a golden siphon for private insurers, for example.Well, public workers are a) not all expenses a state has and b) it only talks about the cost for those public workers that earn more than 6 digit a year and not about all public workers as a whole.
Also: https://www.usdebtclock.org/state-debt-clocks/state-of-california-debt-clock.html
https://www.statista.com/statistics/312660/us-state-and-local-government-debt-outstanding-by-state/Of course, but surely those public workers aren't the only reason California is in trouble. They must be wasting money everywhere. Health care must be a golden siphon for private insurers, for example.
ps. shit looking grim in all states.
The context is that Californias depts are higher than their yearly GDP - which is generally viewed of the threshold of things being seriously bad. And unlike an entire nation, Californa by themselves can't just print more currency in order to inflate it and thus effectively decrease their depts. In addition to it the entire Corona thing happened which means a more than relevant decrease of tax-revenue and apparently Tesla not being the only California-based business that is considering moving for various reasons including cost.California is in the fortunate situation that two extremely important industries are concentrated in its geographic boundaries. Talking about debt without context won't tell us much. California will be more than fine regardless of any debt as long as this doesn't change.
can you share your source, that California's debt is higher than their annual GDP?The context is that Californias depts are higher than their yearly GDP - which is generally viewed of the threshold of things being seriously bad. And unlike an entire nation, Californa by themselves can't just print more currency in order to inflate it and thus effectively decrease their depts. In addition to it the entire Corona thing happened which means a more than relevant decrease of tax-revenue and apparently Tesla not being the only California-based business that is considering moving for various reasons including cost.
To say it will be "more than fine" is definitely pushing it. If anything, I suspect them having to do some serious cuts on public spending during this year to make up for the loss of tax-revenue.
“Combining California’s debt with publicly held federal debt, we estimate a total debt-to-GDP ratio of 125% (or 153% using the broader definition of federal debt),” California Policy Center report released in 2017 points out. “This level places California distressingly close to peripheral Eurozone countries that faced financial crises in 2011 and 2012. Portugal’s 2015 debt-to-GDP ratio was 129% and Italy’s was 133%.”
https://www.forbes.com/sites/patric...-finances-are-not-back-in-black/#586d4cbe37b5
I generally agree with you. And they obviously did some form of estimation. And it is tricky to get 100% accurate numbers because governments - just like businesses - like to put out their numbers in a way it makes them look better than they actually are.Just to clarify what the report (from 2017), that they base the substantive part of the article on, is saying:
- the official debt of state +local governments in California was 426 billion in 2014 and they accept this as credible ball-park figure.
- they add a bunch of other positions, that they consider equal to debt, like unfunded pension obligations, other benefits and end up at 1287 billion. Thats roughly 52% of California's GSP (Gross state product) at the time.
- on top of that they add the share of the federal debt, that is Californian taxpayers may be responsible for (not sure how they calculated this exactly) and end up at 125%/153% debt-to-GDP figures
I like some of their methodology, especially highlighting "hidden" debt like unfunded pension obligations and have little problem with their substantive claims. You can't compare their results with any numbers that are usually referred to, because they use a very different methodology that comes to very different results.
With this methodology every single US state is going to look bad. We can't compare debt numbers, that include many additional items with statistics, that are just the "raw" debt. If you do that you also have to use the 426 billion (or whatever the up-to-date number is). We can happily debate if the US federal debt is too high and if thats a problem, but attributing this to individual states is kind of pointless.
The approach to compare US-state debt with the debt of other countries is questionable, but the very least you should do similar accounting. They managed to increase the official number from 426 to 1287 billion. What happens with Italy's federal debt when we do the same and add additional averaged local debt ? I have no idea and I doubt anyone can honestly calculate this, but its probably not going to be pretty.
You might argue that US federal debt is too high. If the US is doomed, California is probably fecked as well, but that has nothing to do with their state government. Hiding pension obligations isn't pretty but common in most countries. California will be fine.
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an entire career propped up by right-wing politicians only to highlight on a weekly basis that they basically believe economic discourse and academia ends at econ101Tweet
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laffing at the laffer curve
First, there are certainly not "lots" of 22-year-olds making 150K+. That would, at the very least, place them in the top 1% if not closer to the top 0.1% (this data only goes as low as 27-year-olds). Of that exceptionally rare group the overwhelming majority are some athletes (NBA, NFL, world football), actors, and musicians. You'll also find the fake "self-mades" who were gifted a chunk of start-up capital from their families who also bequeathed them a network of important connections. Additionally, many of the most valued talents are nowhere near to making money at that age (for instance, future surgeons are just beginning med school then they have multi-year residencies then elite Fellowship training).Only when Clinton supporters claimed fraud first.
Agree about being off-topic, but lots of high-performing 22 year olds are making 150k+ these days in the US and in your system, they would be paying 50% off the bat which would hinder a lot of technical innovation. I also do not think 1M or so are crazy wages, and those are generally paid to people who are the very best in their field after many years of hard grind.
I think you are conflating your desire to tax people more while ignoring most people on a salary never really make a lot (as a percentage of total individual wealth). Shareholders and/or old wealth make orders of magnitude more.
Income is the way for poor people to gain class mobility, and progressive income tax (with crazy higher brackets) works actively against that. There is a reason why some of the fiscally worst states in the US have high graduated state taxes.
I have been telling this to people from day one. There is a lot of businesses that have great and valuable locations, some of these locations have been made available and someone is going to be extremely happy. If you are in the commercial real estate industry and have liquidities then the pandemic could be the best thing ever.I was reading a Reddit thread where people said this pandemic will make the wealthy even wealthier. Because they can buy up struggling small businesses or their real estate.
Thoughts?
In recent years governments have coped with the huge spending of the financial crisis by QE and keeping interest rates near zero, at all-time historic lows. The extra money put in has meant that assets such as equity and property have risen, and the wealthy have got wealthier. Now covid has meant government expenditure has gone up to even another level, so I can only see more of the same, with governments desperate to keep interest rates from rising, because if they did rise their balance sheets would be completely and utterly fecked, so it will be more of the same, and the rich with assets will get even richer.I was reading a Reddit thread where people said this pandemic will make the wealthy even wealthier. Because they can buy up struggling small businesses or their real estate.
Thoughts?
Not likely. Everyone is already levered up to their eyeballs.I was reading a Reddit thread where people said this pandemic will make the wealthy even wealthier. Because they can buy up struggling small businesses or their real estate.
Thoughts?
100%I was reading a Reddit thread where people said this pandemic will make the wealthy even wealthier. Because they can buy up struggling small businesses or their real estate.
Thoughts?
https://www.bbc.com/news/amp/world-asia-china-55454146China will overtake the US to become the world's largest economy by 2028, five years earlier than previously forecast, a report says.
The UK-based Centre for Economics and Business Research (CEBR) said China's "skilful" management of Covid-19 would boost its relative growth compared to the US and Europe in coming years.
Meanwhile India is tipped to become the third largest economy by 2030.
Could also be due to the change in stamp duty coming in March? I know a few people buying/selling now because of it, and some are selling to investors keen to get in quick.100%
I can’t afford to buy a home in London. But I can buy two in Sheffield, Bristol etc quite easily. Housing stock is being purchased and added to portfolios now at a frightening pace.
I don’t want to be part of this system but it’s looking like the only option. I hate it.
No. Homes are all under the old thresholds. It’s a huge land grab by the wealthy. These homes all rent for more than the mortgage costs. It’s horrifying.Could also be due to the change in stamp duty coming in March? I know a few people buying/selling now because of it, and some are selling to investors keen to get in quick.
Ah okay. I agree it's a mess as housing is the sole factor that's kept me moving back to London. I used to work there for about 2 years after graduating, living in shared places and chose to take the option to do a master's just to get the heck out. The long-term outlook just seemed depressing. I've got friends who've bought recently in new estates aimed at tenants already living in the area but it's a lottery and already prohibitive given how much it costs (300k for one bed flats in both cases).No. Homes are all under the old thresholds. It’s a huge land grab by the wealthy. These homes all rent for more than the mortgage costs. It’s horrifying.
We’re ridiculously privileged. It’s looking like we’ll buy a couple of properties and live between London, Auckland, Croatia and Germany going forward.Ah okay. I agree it's a mess as housing is the sole factor that's kept me moving back to London. I used to work there for about 2 years after graduating, living in shared places and chose to take the option to do a master's just to get the heck out. The long-term outlook just seemed depressing. I've got friends who've bought recently in new estates aimed at tenants already living in the area but it's a lottery and already prohibitive given how much it costs (300k for one bed flats in both cases).
I don't mean this as a humblebrag because I really do think it's a complete garbage case. I work in tech so I know London offers better job opportunities.
Are you tied to London yourself or could you consider moving to Bristol/Sheffield etc?
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It's very hard to isolate a single variable and demonstrate a causal relationship in the real world. It's not like a science lab where you have controlled experiments. It's a social science at the end of the day.Why is there so much contradiction in economics? Some guy saying one thing, the other saying the opposite. 1 study showing an effect, the other study showing no effect.
It's exactly what makes people sceptical. Why believe anybody anymore? For example, climate change & whether blue states subsidize red states in the US are 2 topics that can't seem to get a consensus on Reddit, though there's politicial bias involved obviously.
It doesn't help that there are conservative-focused think tanks and liberal-focused think tanks. I would ideally want both conservatives & liberals to work together in researching topics like labor unnions, minimum wages, immigration etc so everybody can have their input and concerns accounted for. And whatever research comes out of that collaboration surely can't be rebutted by "they cherry-picked data to help conservatives or liberals!".
Surely a deeper collaboration between conservatives & liberals should result in such articles having more consensus or less extreme conclusions?It's very hard to isolate a single variable and demonstrate a causal relationship in the real world. It's not like a science lab where you have controlled experiments. It's a social science at the end of the day.
You can try and filter out some of external noise with statistics (econometrics) but it's very hard to control for self-selective effects, or other internal biases.
I was more saying why academic studies can disagree with each other.Surely a deeper collaboration between conservatives & liberals should result in such articles having more consensus or less extreme conclusions?
AP Fact Check claims blue states do subsidize red states:
- https://stream.org/behind-the-misleading-statement-that-blue-states-subsidize-red-states/
- https://thehill.com/opinion/finance/502321-no-blue-states-do-not-bailout-red-states
So which is it?
During the worst year for economic recovery since 1946, Americans socked away money at a historically high pace.
But those savings largely stayed in the pockets of higher earners, while everyone else held close to nothing by the end of 2020.
U.S. households accumulated around $1.6 trillion in excess savings over the last 10 months, according to an analysis by Oxford Economics. But the top 20% of earners — and to a lesser extent the second 20% —account for all the current accumulated cash. Meanwhile, the bottom 60% have spent most of the savings they accumulated in the pandemic from direct payments and unemployment benefits.
“All of the savings buffer is essentially now in the hands of the top 40%,” Gregory Daco, Oxford Economics’ chief U.S. economist, told Yahoo Money. “Whereas the bottom 60% have essentially spent most of their fiscal transfers.”
This is why some of the more bullish economists in the UK are predicting a strong recovery once we open up again. There's an estimated £100bn sat in people's bank accounts which they're itching to spend.
Except, the richer you are, the less likely you are to spend your money. The poorer you are, the more likely. Since poor people have no money ....... well we can only hope there is enough support/stimulus from gov to shore the economy up until it reopens.This is why some of the more bullish economists in the UK are predicting a strong recovery once we open up again. There's an estimated £100bn sat in people's bank accounts which they're itching to spend.
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because economics isn't a science, it's an art discipline. It has numbers and equations, but they are used almost exclusively in an ideological/"soft science" setting.Why is there so much contradiction in economics? Some guy saying one thing, the other saying the opposite. 1 study showing an effect, the other study showing no effect.
It's exactly what makes people sceptical. Why believe anybody anymore? For example, climate change & whether blue states subsidize red states in the US are 2 topics that can't seem to get a consensus on Reddit, though there's politicial bias involved obviously.
It doesn't help that there are conservative-focused think tanks and liberal-focused think tanks. I would ideally want both conservatives & liberals to work together in researching topics like labor unnions, minimum wages, immigration etc so everybody can have their input and concerns accounted for. And whatever research comes out of that collaboration surely can't be rebutted by "they cherry-picked data to help conservatives or liberals!".
