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[LoSboccacc]

eh, if they want to save money on that, give them daisy cups. welfare stuff should be the most price effective, since money has to come from someone else (all of us).

What do poor people do with the money however?  If you e.g. give 30,000 people $10K to live on, they have to spend it. Say 2/3rds of that goes to creating minimum-wage jobs and you set those at $20K. That just made 10,000 jobs to feed/cloth/house the other 30000. But those 10,000 people are going to spend their money, and 2/3ds of that is also going to spent on wages, so you get another 6666 jobs happening, and those people spending create another 4444 jobs and so on. If you do the limit sum for that you get a total number of jobs created of .... 30000. Those are just rough numbers but they happened to work out that way. My point is that by setting the right minimum wage and welfare payments, you can in fact create more actual jobs than the number of "slackers" you create. Part of the reason this works is that labor is an under-utilized resource. People have plenty of time to spare, but we have finite limits of other resources. We can run out of steel, but it'd take a hell of a lot of effort for us to run out of people who have spare time.

sorry I wasn't following that thread of discussion, was related more to tampoons and stuff, not about giving minimum living wages.

[Reelya]

I was responding to the last part of the sentence. But since we were talking about tax rate changes and their effects on pricing, yeah welfare wasn't really the topic.

The point was, welfare money can actually create more jobs than it displaces (i.e. number of "lazy" people created). After all, money doesn't just get spent once it get spent over and over, and gradually disappears back into taxes. Basically the government hands that money out, and most of it ends up back in the same place.

So this idea that they gave out your money, so there's less money now, that's just not correct.

[LoSboccacc]

don't most of money immigrants can save goes back to home country to support their families?

they spend on the bare minimum.

beside, the claim that illegals trickle down actually impacts the goods market is incompatible with the claim that the illegal workforce is small enough to be irrelevant to the job market, so there's that, it's literally either or.

[Reelya]

If someone in another country gets American dollars, what do you think they do with them. Do they have a big money bath and laugh at America? American dollars are for buying stuff from America. So even that "left the country" argument fails. At some point, anyone paid in US dollars has to buy American products with them.

Additionally, if money did leave the country, permanently. e.g. if Mexicans earned dollars then hand a "dollar burning party" in Mexico. Why would that be bad? They're only pieces of paper. If someone earns dollars and throws them away or hides them in a mattress, that's anti-inflationary, which allows the US government to just print more of the things. They cost a fraction of a cent to print.

The point is dollars are only pieces of paper. If people take your pieces of paper out of circulation, print more of the things until it's in balance again. Nobody is taking anything from you when dollars "leave the country". Say a Mexican guy digs a ditch, and gets US dollars for it, then laughs and burns the money. He took money away from America! But let's just be rational about this. He got and wasted a bit of paper, America got a ditch dug. How about instead of burning it, he gives that dollar to someone in Mexico. Now, Mexico is $1 richer than before, but America is exactly the same as it was in the scenario where the fiendish Mexican man burnt the dollar. Because Mexico is "up $1" compared to other scenario is America actually any worse off than otherwise?

[LoSboccacc]

that has broken window fallacy written all over the place

[Reelya]

Not it doesn't really.

Dollars are in fact just pieces of paper. It doesn't cost a dollar to print a dollar, which would have to be true for the "broken window fallacy" to be applicable.

Just be goddamn rational. If Mexicans get dollars, they put them in the bank, converting them to pesos. Those dollars are then provided to Mexican businesses to purchase goods from America. It's what American dollars are for.

Those dollars might float around for a little while, but they're for buying American things. And if some Mexican gets dollars and just fills a bathtub with dollars. Well, he did a pile of work, and got a pile of pieces of paper for it. It's his loss if he doesn't spend it, not America's. And if you think America did lose out because some Mexican is hoarding 1 million pieces of paper from America and won't use them to buy things, well then the US government could just as easily print 1 million new bits of paper and buy things with that, and give them to American, or Mexicans for that matter. The economic effects would be identical to if someone else bought the same things with the same amount of money.

And if a dollar gets "lost", all the nation has actually lost is that bit of paper, nothing more. The cost of printing money is near zero relative to their face value. The idea that money is a tangible thing in the sense that a physical commodity like gold is, where you can do zero-sum logic like "if Mexico gets our gold, we have less gold". Well that logic doesn't work for a fiat currency. You can't make gold for less than the market price for gold. The government can in fact print money for less than the market price for money.

[LoSboccacc]

lel like america is the only world manufacturer now?

[Reelya]

No ... but any money in US dollars will be spent in America. Because it's American money. It doesn't magically become foreign money because foreign germs got on it.

So the alternate "scenario" you're saying now is that those US dollars earned by the Mexican guy find their way to China. Now, what exactly are Chinese people going to do with American Dollars?

But remember that if people don't give the bits of paper back, that's not really hurting your economy. It's only paper for Christ's sake. Say you import 50 million tons of vegetables from Mexico. You got the vegetables, which have real-world value. While, they received a big pile of pieces of paper, "American Dollars". But "American Dollars" are basically a paper IOU slip that says that if you have them, you can later use them to buy things from Americans. If you give people an IOU, and they later rip that up, it's costing them, not you.

[Sheb]

Add them to their two trillion piles of US treasuries?

[LoSboccacc]

wait do you think money changers just apply a stamp and ship money back home?

[majikero]

Money changers sell it to the government in exchange for local currency. Where do you think money changers get their money from?

[Reelya]

wait do you think money changers just apply a stamp and ship money back home?

My point was that if that money "leaves" America you're not actually hurt as a nation in any way, shape or form. All you've actually lost is those bits of paper.

I think LoSboccacc you're seeing this as a "zero-sum game" and you don't really get the concept of "fiat currency". Modern money isn't "stuff" it's just cheap pieces of paper with some fancy printing on it. Effectively it's a form of IOU: anyone holding that money can buy things in America with it. If foreigners get those IOUs and never cash them in, that's their loss. America imported something of tangible worth (products, food etc), and they got a pile of IOUs.

[Frumple]

J... just to check, you do know people in other countries do, in fact, at times perform transactions using the USD, right? Plenty of american paper bills get used outside the country, and not even just by americans or US affiliated folks or whatev'. Value attached to the currency (not just the paper itself) actually can cycle out and not come back to one extent or another. It's small, but that does have a tangible effect, as what it means is the agreed upon labor equivalent has walked off and not come back home.

Fiat currency does mean that's generally not a big deal (particularly when you're talking one as major as the USD), but... fiat currency doesn't actually work under the concept of, "Well, we can just print more," regardless as to if the physical printing costs less than the market value or not. Lot more involved in keeping one stable and usable, and artificial scarcity can be pretty integral to that... and part of that, is being fairly careful about replacement and whatnot.

[Sergarr]

Well, according to some random guy on Twitter quoted on a front page of Russian news aggregator, Trump administration has an executive order ready to lift Russia sanctions. Trump will also talk to Merkel on Saturday, presumably to pressure her into lifting sanctions on Russia as well.

[Reelya]

Well I think other countries using dollars actually stabilizes the value. e.g. Ecuador is "dollarized" thus a lot of dollars are tied up in transactions there.

Also there's a problem associated with the idea that the value itself has been lost when the money doesn't come back. If the money doesn't come back, that's actually anti-inflationary, which maintains the value of the rest of the money that remains in circulation. So while there's still value associated with the outgoing dollar, that doesn't necessarily mean an equivalent amount has been lost from the dollars that remain.