Tax cuts- A simple lesson in economics

by **Murgatroyd** » Mon Mar 22, 2004 9:46 am

Originally posted by RCglider
You can't honestly tell me the work ethic hasn't degraded over the past 30 years. Kids think they are owed something these days. There are a lot of entry level jobs out there. Problem is, people are conditioned to think they should be making $40k/year flipping hamburgers.

I didn't miss the point about costs of cars, you obviously misunderstood the topic. How about putting it this way: the average car purchased is $30,000. That means consumers are buying more higher end vehicles and don't want politically correct cars..

It's really nobody's business why someone buys a 4x4, is it? They buy them because they want to, and that's how the market works. If people didn't want them, they wouldn't sell. And there are jobs that require them, such as rural mail carriers. If they were the only ones buying them, the cost would be astronomical. If I want to buy a 4x4, getting permission from someone else is of no concern. Forcing consumers to buy what they don't want is not how our economy works.

How many examples do you want of Democrat Marxist demagoguery? It's not even debateable. So as to prevent wasting time, I am not a card carrying Republican.

People that walk down the middle get run over.

You're absolutely right.

To avoid being wordy, I'll just say I concur with everything you just said..

"When the people find that they can vote themselves money, that will herald the end of the republic." - Benjamin Franklin

by **Bullhead** » Mon Mar 22, 2004 11:03 am

Originally posted by RCglider
People that walk down the middle get run over.

LMAO. I've not heard that one before.

by **igloo17** » Mon Mar 22, 2004 11:37 am

Originally posted by C. Murgatroyd
You're absolutely right.

To avoid being wordy, I'll just say I concur with everything you just said..

"When the people find that they can vote themselves money, that will herald the end of the republic." - Benjamin Franklin

I agree.

by **JimmyTango** » Mon Mar 22, 2004 1:18 pm

Rcglider,

More half truthes. You are good at it. The average MSRP of a car did indeed top $30K The average selling price was $26K.

by **RCglider** » Mon Mar 22, 2004 2:17 pm

I stated what the sticker price is, that is not a half truth. Each buyer gets their cut, if any, from dealer/mfr programs depending on many variables . In other words for example, if purchasing a GM vehicle, a GM employee discount (which I can get) will afford you a hefty reduction of the MSRP. However, the vast majority don't get anywhere near that.

It doesn't matter if the MSRP is $30,000 or $10,000 or whatever. For purposes of comparison, it shows people are buying the more expensive vehicles after the bottom line, and that is the point. They aren't buying Chevy Cavaliers, they're buying Chevy Trail Blazers.

The market is what drives sales, not some government bureaucRAT or environmental whacko. Take away market forces, and watch the industry go down the tubes.

If I want to drive a Tahoe, Hummer, Lexus, Mercedes, Hundai, Corvette or a 30 year old rust bucket, it's nobody's business if I feel I can afford it and it's what I want.

by **Sir Loin** » Mon Mar 22, 2004 2:20 pm

i agree

by **JimmyTango** » Mon Mar 22, 2004 2:38 pm

Originally posted by RCglider

If I want to drive a Tahoe, Hummer, Lexus, Mercedes, Hundai, Corvette or a 30 year old rust bucket, it's nobody's business if I feel I can afford it and it's what I want.

I do not know why you keep coming back to this as I have yet to see anyone tell anyone else what to drive.

And you are right, of the three posts on the $30K car you did once say sticker, which was the first post. The other two, not even close to labeling it as such, which is extremely deceiving. Something only democrats do, which I think has been a point of yours for some time(and is completely nto true, since both parties do it each and every day).

by **RCglider** » Mon Mar 22, 2004 2:49 pm

Originally posted by JimmyTango
I do not know why you keep coming back to this as I have yet to see anyone tell anyone else what to drive.

And you are right, of the three posts on the $30K car you did once say sticker, which was the first post. The other two, not even close to labeling it as such, which is extremely deceiving. Something only democrats do, which I think has been a point of yours for some time(and is completely nto true, since both parties do it each and every day).

If you had understood what the point is, I wouldn't have had to repeat myself and explain in detail. You're splitting split hairs..

by **Colonel Ingus** » Mon Mar 22, 2004 2:54 pm

So, Ingus, the offshoring of 220K jobs explains only a small fraction of the unemployment. 220,000 may sound like a lot, until you realize the US labor force is 141.8 million (in 2001)! I'm afraid the attention being paid to the offshoring of service jobs is out of proportion to its effect. The increase in unployment rate, to a still very healthy 5.6% (which is NOT high), can be explained a lot more by being in a recession.

Wasn't so much worried about the number but wanted to illustrate that both side of the political spectrum are guilty. And I would wager if you were one of those 220,000 it would be a big deal.

And now, strangely:D , some agreements with Jimmy

I would say a 4 x 4 is not essential, and conductive to pleasure and comfort. Heck, I do nto understand why anyone living hwere it does not snow has a 4 x 4. What is the point? I live in north east ohio where half the year it is freezing and covered in snow. I have never owned a 4 x 4 and have never needed one. Why someone in Florida, Hawaii, Texas, Arizona, etc etc etc would need one is beyond me.

I live in Minnesota and here we have two seasons. Winter and Road Construction. I have never needed a four wheel drive and can't see paying for one. I used to live in Southern California in my military days and it just cracked me up seeing all these 4x4's used for city driving.

The saddest thing is, we allow it to be a two party system, and the politicians have set it up so only the two parties are heard during presidential debates, when we are not supposed to be a two party system. I often find that 9 out of 10 times, neither side is right and the middle ground is. Instead of working towards that middle ground, each side finger points at the other side until their terms are up and have little to show for their time in office. Well, except for their great finger pointing skills, they can always use that on their next job app.

I couldn't agree more with you Jimmy. We are probably far apart on our political beliefs but I agree one hundred percent on this one. Most voters find they are never voting for the right person for the job but to keep the other guy out. What kind of system is that? The whole system is wrong and needs to be chucked out and replaced.

Its kind of funny because when I was a kid in school and we said the pledge of allegiance (yes we used to do that and no one I know grew up to be a serial killer because of it.) it was "And to the REPUBLIC" not to the democracy. History has shown repeatedly that democracies always fail and why we think we can get away with it is beyond me. Its been quoted a billion times previously but it is so true. When people discover they can vote themselves privileges from the public largesse democracies are doomed to fail.

You can't honestly tell me the work ethic hasn't degraded over the past 30 years. Kids think they are owed something these days. There are a lot of entry level jobs out there. Problem is, people are conditioned to think they should be making $40k/year flipping hamburgers.

And I can't help but agree with this one. When I was a teenager if you were lucky enough to have a car you payed for it by working at a burger joint (pizza joint in my case) and it wasn't a new 4x4 suv but a 10-20 year old beater that sucker you dry just keeping it running. Now when i go thru the drive thru its all immigrants and I see average American kids expecting to get a white collar job right out of school and complaining when they don't. I'm sure some of you guys worked shit jobs just like I have to make ends meet and are bothered by these kind of attitudes as weel.

by **igloo17** » Mon Mar 22, 2004 2:58 pm

Originally posted by JimmyTango
I do not know why you keep coming back to this as I have yet to see anyone tell anyone else what to drive.

And you are right, of the three posts on the $30K car you did once say sticker, which was the first post. The other two, not even close to labeling it as such, which is extremely deceiving. Something only democrats do, which I think has been a point of yours for some time(and is completely nto true, since both parties do it each and every day).

Who cares if the average car sale is 30k, or 26K, neither of you backed up your figures of 30k or 26k, like where did your get that number from?

Does this matter, except for this point I'm going to make. If the average selling price of a NEW CAR is over 20k, then that leads one to think that just maybe there are alot buying vehicles that cost over 15k. And what size/type of vehicle costs less than 15k? I'd guess not a SUV, or mid-large sedan?

So people are buying the the more expensive vehicles? Do some of these use more fuel? Should we punish them for thier 'free choice'?

So where does this lead, well leads me to think the economy is not as bad as we are lead to believe.

Seems to me you two are getting picky over your wording on each others posts, but thats how I feel about it, what do you think.

by **JimmyTango** » Mon Mar 22, 2004 3:14 pm

http://money.cnn.com/2004/01/21/pf/autos/prices/

Also, the average price means nothing to begin with. You need to look at numbers of cars sold.

Think of how many $9,999 cars it takes to bring the level down to $30k for every $100k car sold, every $150k car sold, every $200K car sold, etc etc. The fact that the average selling price is $26K shows an extreme slant towards the lower end price range.

by **PudriK** » Mon Mar 22, 2004 3:47 pm

I think you are all missing the point when it comes to auto sales. We can all agree that sales of relatively expensive, feature-rich cars are up in the past few years. Some have said, well, people buy what they want, and some have said, this shows the economy is doing well.

Both statements are true, but they don't prove anything about growth distribution--or how well low-income families are doing.

Let's take another industry. If I said, vacation cruise sales were up, would you assume that everyone is going on cruises, or would you assume that the people who used to take one cruise a year are now taking two? Both could be true, but the former would imply an even benefit across all incomes, while the latter would imply only the top tier are doing better.

When it comes to auto sales, you can't merely point to sales being up, but you have to examine which portion of the population is making these purchases.

I think you could make a strong argument that if sales are up on high-end vehicles, it is more likely that they are being purchased by people who are already comparitively well-off. Given a raise in income, a low-income family would, say, buy a new car instead of a used car. But a high income family would buy a nicer car, a lexus instead of a honda. By the same argument, the fact that Niemann-Marcus and Nordtroms are doing well would not imply that low-income families are doing any better than before, but rather only high-income families have realized gains in income.

If lower-income families were doing better, we would expect to see headines about increased sales in low- and mid-priced vehicles, and thus the average new car price would be lower, not higher.

Although the economy is doing better, what is at issue is that these gains are not being realized by lower and middle income Americans.
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Jimmy, to answer your post, don't forget that the number of $10K cars sold is already much larger than the number of $150K cars sold. But if we see the average sale price increase, it means two things... inflation, and a greater proportion of higher end cars being sold than before.
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Ingus, my point was that all the hemming-and-hawing has been over outsourcing as the cause of recent job loss, when the reality is most jobs were just plain eliminated, as usually happens during a recession, not offshored. We are focusing our energy on a relatively minor factor. Not to mention, blaming government for the loss of jobs, as if it was their responsibility to find you work. (*cough* communism *cough*) Gov't can mitigate economic forces, but it can't "create jobs." Well, it can, but then it has to raise taxes to pay for them, which just makes things as a whole worse.

by **JimmyTango** » Mon Mar 22, 2004 4:10 pm

Originally posted by PudriK
Although the economy is doing better, what is at issue is that these gains are not being realized by lower and middle income Americans.

Which is what is important. This country lives and dies off of the middle and lower classes' spending. There are no if's and's or but's about it.

by **igloo17** » Mon Mar 22, 2004 4:10 pm

http://www.edmunds.com/help/about/press/101245/article.html

Yes I agree, we missed the point all together here.

Some like to post to just argue a point to death, thats how I feel about this.

by **Colonel Ingus** » Mon Mar 22, 2004 4:19 pm

Ingus, my point was that all the hemming-and-hawing has been over outsourcing as the cause of recent job loss, when the reality is most jobs were just plain eliminated, as usually happens during a recession, not offshored. We are focusing our energy on a relatively minor factor. Not to mention, blaming government for the loss of jobs, as if it was their responsibility to find you work. (*cough* communism *cough*) Gov't can mitigate economic forces, but it can't "create jobs." Well, it can, but then it has to raise taxes to pay for them, which just makes things as a whole worse.

I wasn't even griping about the loss of the jobs I was merely pointing out that both political parties engage in this type of activity.

You are 100% correct in that government can mitigate these factors. Unofrtunately it is mitigating against the American worker.

Tax cuts- A simple lesson in economics

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