The Gini coefficient measures the gap between the rich and the poor. The higher the number the greater the difference. The coefficient varies between 0 and 1, but is usually multiplied by 100. Canada and most of the western European countries have a ratio in the mid twenties. The USA was under 40 through the mid 1980’s at which time it began to rise. Now it is well over 40 and the USA has a similar position to many of the banana republics.
Anyone who has spent much time in Latin America knows that in this type of system, the poor people live in hell and the rich people live in jail. The middle class is almost non-existent. This has changed over the last several years. Latin America’s coefficients have been going steadily down, while the USA has gone steadily up.
Part of this can be explained by the erosion of our industrial base. Most of the problem comes from the governments theories of “trickle down” economics. The idea being that if the rich people get more money, the benefits will “trickle down”. Unfortunately the rich people use the money to invest abroad or by imported good. All the poor people get is a warm damp feeling on the back of their neck.
David Segrest, CCIM, CIPS, CEA, TRC, is a REALTOR in Charlotte NC. His web page is http://www.segrestrealty.com. His email address is david@segrestrealty.com.
Showing posts with label Trickle down economics.. Show all posts
Showing posts with label Trickle down economics.. Show all posts
Monday, October 4, 2010
Friday, December 5, 2008
What Happened to the Old Home Remedy
What Happened to the Old Home Remedy
The only benefit most of us get from the trickle down economic stimulus plans of the current administration is a warm damp feeling on the back of our necks. What happened to the old fashioned stimulus packages that always worked? Are they too old fashioned and unsophisticated? My dad always said that it never helped him when the Rockefellers got extra money; because he wasn’t smart enough to get it from him. When The working men got money he was smart enough to get some of it.
The roads and bridges throughout our country are in horrible condition and overcrowded. Those projects put people to work and stimulate the local and national economies. Commercial REALTORS® know that progress follows roads. Progress puts more people to work. The construction workers spend money at Walmart and the local restaurants and watering holes. The engineers spend money at Target, Sachs and the cheaper restaurants. These people buy homes and make mortgage payments. Usually their payments are on time.
Making jobs raises wages and income. Bailing out the auto industry or financial institutions requires that they cut jobs and reduce wages and benefits. How does this help the economy? The effect of the current bailout plans is only a further stratification of our society. The effect of new roads, schools and jobs would be growth in the economy and in the lifestyle of the people.
David Segrest is a REALTOR in Charlotte NC. His website is http://www.segrestrealty.com His email is david@segrestrealty.com
The only benefit most of us get from the trickle down economic stimulus plans of the current administration is a warm damp feeling on the back of our necks. What happened to the old fashioned stimulus packages that always worked? Are they too old fashioned and unsophisticated? My dad always said that it never helped him when the Rockefellers got extra money; because he wasn’t smart enough to get it from him. When The working men got money he was smart enough to get some of it.
The roads and bridges throughout our country are in horrible condition and overcrowded. Those projects put people to work and stimulate the local and national economies. Commercial REALTORS® know that progress follows roads. Progress puts more people to work. The construction workers spend money at Walmart and the local restaurants and watering holes. The engineers spend money at Target, Sachs and the cheaper restaurants. These people buy homes and make mortgage payments. Usually their payments are on time.
Making jobs raises wages and income. Bailing out the auto industry or financial institutions requires that they cut jobs and reduce wages and benefits. How does this help the economy? The effect of the current bailout plans is only a further stratification of our society. The effect of new roads, schools and jobs would be growth in the economy and in the lifestyle of the people.
David Segrest is a REALTOR in Charlotte NC. His website is http://www.segrestrealty.com His email is david@segrestrealty.com
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