Politics of mustachianism

[Celda]

Your arguments make no sense.

Just because some people (like many people here) strive for early retirement or financial independence, does not mean that we are obligated to help others achieve either.

If that argument was true, then fitness aficionados who strive to get fit and work out a lot are obligated to help others get fit.

People who strive to become better artists or musicians are obligated to help others become better artists.

Clearly this is nonsense.

[icky]

This is going to be pretty basic:  I like this place and part of the reason is the politics lean somewhere towards localized libertarian.  Don't stress out and worry about shit you can't control  go and take personal responsibility and control the stuff you can.  Also understand that freedom is a simple math formula:

Money = Freedom
Buying stuff costs money
Therefore buying stuff costs freedom

How do you choose profitable investment strategies/passive income generators that fit with your localized libertarian politics?

How do you take personal responsibility for your investments if the ideal is for them to be "passive"?

[chasesfish]

This is going to be pretty basic:  I like this place and part of the reason is the politics lean somewhere towards localized libertarian.  Don't stress out and worry about shit you can't control  go and take personal responsibility and control the stuff you can.  Also understand that freedom is a simple math formula:

Money = Freedom
Buying stuff costs money
Therefore buying stuff costs freedom

How do you choose profitable investment strategies/passive income generators that fit with your localized libertarian politics?

How do you take personal responsibility for your investments if the ideal is for them to be "passive"?

I avoid mixing investments and my political views.  It's up to the management of the companies I own to play the game regardless of what the political environment is.  I stopped getting stressed out about that a long time ago.

75% of my investments are mutual funds, another 10% is Costco stock, then the rest are much smaller stock holdings.


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[icky]

This is going to be pretty basic:  I like this place and part of the reason is the politics lean somewhere towards localized libertarian.  Don't stress out and worry about shit you can't control  go and take personal responsibility and control the stuff you can.  Also understand that freedom is a simple math formula:

Money = Freedom
Buying stuff costs money
Therefore buying stuff costs freedom

How do you choose profitable investment strategies/passive income generators that fit with your localized libertarian politics?

How do you take personal responsibility for your investments if the ideal is for them to be "passive"?

I avoid mixing investments and my political views.  It's up to the management of the companies I own to play the game regardless of what the political environment is.  I stopped getting stressed out about that a long time ago.

75% of my investments are mutual funds, another 10% is Costco stock, then the rest are much smaller stock holdings.


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What do you think the appeal of libertarianism is to this community then? Do you consider any investments more or less libertarian? (I interpret libertarianism as valuing freedom of the individual above most other things - correct me if I'm wrong)

[G-dog]

Icky,

I think you sound so excited to have a forum for debate and conversation and I think that's great. As a fellow lover of big ideas, I think some of the ideas you've wanted to explore are interesting.

I would like to point out though that going to a forum organized around X and then questioning X can feel disrespectful to the people who go to that community expecting a safe space; they may feel ambushed in a space they didn't expect to have to defend themselves in. This goes double when using emotionally charged language and terms; moral, oppression, etc. In other words I think you are being insensitive to the other members by trying to "yuck their yum".

I'd personally would like to have an opportunity to participate in some of these interesting idea-based conversations without feeling like I'm engaging someone who is purposefully trying to upset others. I think that if you keep your questions but tone down the emotionally charged language, frame things in a way that is more respectful to different life philosophies and stopped openly challenging the idea that this forum is centered around, we can have many interesting discussions. As is, I tend to feel that you are trying to frame being the FI in an overly extremely way (I've never seen anyone here state that FI is for everyone in the world or that it is the end all and be all of life) which makes me hesitant to engage because I wonder I'm going to be able get an open, respectful, even-keeled, idea based conversation.

Good points.
Maybe if there is interest there could be a debate/ politics forum. 
Debate is difficult enough in person, when you can see body language and hear tone of voice, and maybe even have the benefit of knowing the others in the conversation.  Doing this online with strangers seems incredibly difficult to put off without a lot of misunderstandings that may lead to anger and hurt feelings.  Some ground rules may help, along with definitions of terms, etc.

[chasesfish]

This is going to be pretty basic:  I like this place and part of the reason is the politics lean somewhere towards localized libertarian.  Don't stress out and worry about shit you can't control  go and take personal responsibility and control the stuff you can.  Also understand that freedom is a simple math formula:

Money = Freedom
Buying stuff costs money
Therefore buying stuff costs freedom

How do you choose profitable investment strategies/passive income generators that fit with your localized libertarian politics?

How do you take personal responsibility for your investments if the ideal is for them to be "passive"?

I avoid mixing investments and my political views.  It's up to the management of the companies I own to play the game regardless of what the political environment is.  I stopped getting stressed out about that a long time ago.

75% of my investments are mutual funds, another 10% is Costco stock, then the rest are much smaller stock holdings.


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What do you think the appeal of libertarianism is to this community then? Do you consider any investments more or less libertarian? (I interpret libertarianism as valuing freedom of the individual above most other things - correct me if I'm wrong)

Again, I have no political views about my investments.  This probably isn't the right place to try to find a political debate


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[chasesfish]

And to add something else, I really despise politics.  I believe both sides generally suck


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[icky]

And to add something else, I really despise politics.  I believe both sides generally suck


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Agreed. I'm not really meaning republican vs. democrat or choosing candidates or anything like that. I think the FI community attracts autonomous, independent people of all stripes and it's really interesting place because of that. The radical fringes of the right and left bleed into the spaces where they have a lot in common (Catholic workers movements, hippies, homesteaders, home schoolers, radical LGBT communities, libertarians, etc)

My political influences are Thoreau, Martin Luther King, Dorothy Day, Ghandi etc not necessary "politicians."

Its the investing bit I just can't quite get, how do I fit it in to all that? (intellectual inquiry - I apologize to all those who still feel as though I'm picking fights or mincing words)

[firelight]

Hey icky, I've read both your threads and your question here is actually very funny.

I moved from a third world country to US, so trust me when I say majority of the people you worry about live a happy life. True, they don't have the latest stuff but again stuff is not happiness. Also, would they like to have more money? Yeah, sure every person in this world would like to have more money. The reason? So they can do whatever they want. If you like to travel, money can help you do that. If you like to save your kid's life, money can help you do that. If you'd like to protect your family, money can help you do that. I don't see anyone on this forum any different. They want to have enough money to do whatever they want. And they save for it by working hard.

If you don't want to participate in saving and investing, that's up to you. But you claiming to do it for the sake of people in third world countries is funny and frankly ridiculous.

If you really think you should be doing something or atleast get a better understanding of what's really happening out there (pick anywhere you like) I'd suggest you go there, talk to people there and then come up with a plan instead of just talking about it. Remember, 1000 likes on Facebook cannot save a kid. It requires action.

PS: As others have said repeatedly, I really wish you would sit down and read through what everyone is saying instead of spouting off questions and half baked ideas

[firelight]

To answer your questions, I love my job and see myself working there as long as I can. But my life experiences in the above mentioned third world country have taught me to never take anything for granted and save the max when the going is good.... For you never know when it'll turn bad. So the push for FI.
And yeah, helping others reach their FI one at a time is the best way to "stand up for other humans" so they can get out of oppression..... Which I think this community does very well.

So stop criticizing/whining and do something about the issues you only talk of.

[icky]

Hey icky, I've read both your threads and your question here is actually very funny.

I moved from a third world country to US, so trust me when I say majority of the people you worry about live a happy life. True, they don't have the latest stuff but again stuff is not happiness. Also, would they like to have more money? Yeah, sure every person in this world would like to have more money. The reason? So they can do whatever they want. If you like to travel, money can help you do that. If you like to save your kid's life, money can help you do that. If you'd like to protect your family, money can help you do that. I don't see anyone on this forum any different. They want to have enough money to do whatever they want. And they save for it by working hard.

If you don't want to participate in saving and investing, that's up to you. But you claiming to do it for the sake of people in third world countries is funny and frankly ridiculous.

If you really think you should be doing something or atleast get a better understanding of what's really happening out there (pick anywhere you like) I'd suggest you go there, talk to people there and then come up with a plan instead of just talking about it. Remember, 1000 likes on Facebook cannot save a kid. It requires action.

PS: As others have said repeatedly, I really wish you would sit down and read through what everyone is saying instead of spouting off questions and half baked ideas

I am not saying I don't want to invest for the "sake" of the people in third world countries. I am asking how people who have enough money saved to live off of reconcile that with their ideas of their own political worldview. Most people seem to think that it doesn't need reconciling, and thats fine and valid, but I'm not interested in talking to those people, I'm interested in hearing from those that do.

I don't think it requires traveling to every country in the world to know that 80% of humanity lives on less than $10 per day, and wondering if I have more than $500K net worth if there's an underlying hypocrisy there, especially if my 500K is growing passively due to the labors of that 80%, excess consumerism and increasing environmental destruction.

[MoneyCat]

Personally, I have found this website and forum to be an unusual unholy alliance of hippies and libertarians.  It all comes down to wanting freedom and recognizing that the path to freedom is to increase your self-reliance and reduce your consumption.  I am a much happier person because I know I can do what I want and other people really don't have the ability to hurt me very much anymore.

[mozar]

I don't think you're going to find people here who think that investing/ having money itself is something to be reconciled. I don't believe there is anything hypocritical or not hypocritical about money. Money is fungible and does not feel emotion.

Listen, as much as I am enjoying telling you that you are wrong over and over again, it would behoove you to do some research on how the world actually works. Come back in a few months and you can have an actual debate.

And $10 a day is plenty of money depending on where you live.

[icky]

I don't think you're going to find people here who think that investing/ having money itself is something to be reconciled. I don't believe there is anything hypocritical or not hypocritical about money. Money is fungible and does not feel emotion.

Listen, as much as I am enjoying telling you that you are wrong over and over again, it would behoove you to do some research on how the world actually works. Come back in a few months and you can have an actual debate.

And $10 a day is plenty of money depending on where you live.

You're telling me 80% of the world is happy to live in poverty.

Incidentally, using MMM how much do you need in your stache formula....10*365*25=91k, pretty much exactly what I have in savings. So, you're kinda making my point. I could technically already be able to survive on what I have just in savings (and what 80% of humanity does survive on) Who am I to presume my life is so important that I need more than that?

The point is that you actually do need more than that and you're telling me I'm the one who doesn't understand the world. God help me if I ever become so assured that I do.

[Daisy]

The frustrating thing about your arguments is that you throw around a lot of terms which appears you heard at some rally and haven't really thought things through yet. Your heart seems to be in the right place, but your approach here seems to be to criticize anyone trying to achieve FIRE as if they are some kind of heartless and selfish person for hoarding their resources.

You throw words around like socialist/anarchist, female separatism (I looked that one up - what a doozy - do you really believe that stuff?), but it sounds like just rally calls without a lot of thought put behind it or if you really know the meanings of these terms.

Good luck with your search, but I am bowing out of this conversation...

[Blindsquirrel]

 Well if
Money=Freedom
Governments take money
Governments are the enemy of freedom.- Gee, considering the USA has 5% of the world population and 25% of the worlds prison population, that should be obvious.
Probably not too popular on here but a fan of very small governments.  Do not really want to fund blowing up brown guys around the world that the press tells me I should hate, nor a fan invading who knows where. Feed the hungry, educate the young, pave the roads, etc but the rest of it can go away. What you do in private should be your own business, not the governments,

[firelight]

Poverty is very subjective. In Thailand and SE Asia, $10 a day is not poor. Its not stinking rich but its not abject poverty either. This is because things cost less compared to US. If you think that is good enough according to your political views/personal beliefs, I don't think anyone is stopping you from moving there and leading a happy life.

Since things cost more in US, you need more to live the same life. You can't compare two different places without considering their COLs.

Further you don't have to go to every country to make a change. Choose one place, go there, really talk to people living there and figure out what their problems are. That would help you do something to change their lives. I think that is a better use of life's energy than just throwing around terms anonymously in an internet forum that is not set up for it.

I get that you are trying to ask people their views about political considerations around FI but from what I've seen here, people prefer not to mix them up. Asking them why they don't mix it up and telling them they should won't take you anywhere. Its a waste of time that doesn't help the 80% living in poverty.

[sarah8001]

Hey icky, I've read both your threads and your question here is actually very funny.

I moved from a third world country to US, so trust me when I say majority of the people you worry about live a happy life. True, they don't have the latest stuff but again stuff is not happiness. Also, would they like to have more money? Yeah, sure every person in this world would like to have more money. The reason? So they can do whatever they want. If you like to travel, money can help you do that. If you like to save your kid's life, money can help you do that. If you'd like to protect your family, money can help you do that. I don't see anyone on this forum any different. They want to have enough money to do whatever they want. And they save for it by working hard.

If you don't want to participate in saving and investing, that's up to you. But you claiming to do it for the sake of people in third world countries is funny and frankly ridiculous.

If you really think you should be doing something or atleast get a better understanding of what's really happening out there (pick anywhere you like) I'd suggest you go there, talk to people there and then come up with a plan instead of just talking about it. Remember, 1000 likes on Facebook cannot save a kid. It requires action.

PS: As others have said repeatedly, I really wish you would sit down and read through what everyone is saying instead of spouting off questions and half baked ideas

This. I tried to say something like this on your other thread, where you seemed to be asking the exact same pointless questions (and mixing in a lot of highly charged terms like "feminism", "white males", "socialist", "anarchist" in an attempt to evoke an emotional reaction).
The thing is, all your hand wringing about hypothetical ethical questions is academic. It has no use in the real world. Just because you wouldn't want to live the life of a Chinese garment worker, doesn't automatically mean that person is unhappy (not saying here that the garment industry couldn't do a better job). Many of them are probably just as happy as you are. Wealth does not equal happiness. If it did, the suicide rate among wealthy people would be 0%. So would the depression rate. They would all be ridiculously happy. They're not.
If you want to help people, go help people. Mustachianism tends to bias toward action. Most people here, if they see a problem, will go try to fix it. So you won't find what you appear to be looking for: a person who sees something wrong with FIRE, but is doing it anyways.

[bobsmiley]

As a Christian I believe that we are all slaves to something, whether it is work, money, God or devil...or all of the above. What you choose to be a slave to is every human's choice (within the confines of their reality, and no it's not anyones duty to give humans a plethora of choices to be enslaved to though there are plenty in my country). But it's not true freedom. After reading both your threads I think what you are trying to say makes a lot of sense and also resonates emotionally with me. You clearly have great vision and have  made a big impact on those around you even if you can't feel it.

Ultimate freedom from everything is just not attainable. If it was then maybe I could see the human rights position that freedom should belong to all. In reality, we are all enslaved and always will be. Enslaved by our bodies limitations, habits - both good and bad, the family we are born into or have spawned off, sports and yes by corporations. Those who achieve the goals laid out by MMM will gain freedom from materialism and will instead fall slave to something else. This isn't a bad thing, just the way humans are designed. Christianity is all about worshipping God, which is a form of slavery. Inherently some will read that and think it's bad. It's only bad if you enslave yourself to things that will treat you badly. We all crave something to worship. There is more to life then happiness.

[former player]

I feel rather you do about investing, which means that I have never felt comfortable investing in stocks, shares, bonds or the money markets and have never done it.  I am still FIREd.  I have done it with a government job which came with government redundancy and a government pension (you too are currently "investing" in a government pension by having a government job) and by buying my home, which I now rent out. If you capitalise the net value of my pension and add in the house I rent and the house I live in, I have a lot more than most people here are aiming at for FIRE, without a single "investment".  (I'm now fairly close to reaching the stage where I'm either going to have to invest or start giving away what seem to me to be significant sums, just to avoid gifting the use of some soon-to-be accumulating cash to banks which pay derisory interest rates.)

But although I am not directly investing in stocks and shares, my house is rented by two people who work for public companies, so that part of my income is in fact coming, indirectly from exactly the same companies who would be part of a Vanguard fund.  And my government could never have afforded to pay me my professional-level salary and benefits if it were not taking taxes from the public companies which are invested in by Vanguard funds.    So I have to acknowledge that even without "investing", I am part of the system.  The only way not to be part of the system is to not have any money, and as far as I know the only way for a woman to be safe in this world without having money is for her to be a nun.  Which is why I suggested it to you on the other thread.  Although it is not something I could ever do, I don't particularly recommend it, and I completely understand if you don't want to do it.

If anyone else can suggest ways for a woman to be safe in this world without having money, I'd be interested to hear what they are.

[Tai]

This is the thing you don't understand Icky. Many people who live on 10$ a day are happy, much happier than you are I suspect. Once you can take care of yourself and your family more money doesn't make you happier. Even in North America this is true, I think the cut-off is around $80,000 because of a higher cost of living. Money is not what makes people happy. Look up relative poverty versus absolute poverty. Many people in developed countries are unhappy because they/we are brainwashed into thinking that we NEED that new car to be happy. Or even a car at all. So the MMM idea is to reject that mindset. I am not a libertarian, far from it. And these forums are very diverse. If you don't like the idea of investing in a broad index fund then look for investments that you consider ethical, they are out there.

And FYI, I think that people who have the resources and means to provide for themselves in the future need to do that and not rely on social services that I think should be more for people who never had a choice or ran into catastrophe. Just my opinion.

[swallowtail]

Ultimate freedom from everything is just not attainable... In reality, we are all enslaved and always will be. Enslaved by our bodies limitations, habits - both good and bad, the family we are born into or have spawned off, sports and yes by corporations. Those who achieve the goals laid out by MMM will gain freedom from materialism and will instead fall slave to something else. This isn't a bad thing, just the way humans are designed. Christianity is all about worshipping God, which is a form of slavery. Inherently some will read that and think it's bad. It's only bad if you enslave yourself to things that will treat you badly. We all crave something to worship. There is more to life then happiness.

This is so wise.  Have you ever seen how when a pigeon walks around it can't help but  bop its head back and forth and back and forth back and forth?  It looks stupid and inefficient, yet  Human beings experience the same phenomenon in a different way.  There are things that we just do, because of what we are.  We have real limitations.  The project of understanding what those limitations are, how they manifest, and how to transcend them, is ongoing work of the greatest human minds.

I just watched (and highly recommend) the Michel Gondry movie "Is the Man who is Tall Happy" - it is an animated interview with Noam Chomsky about his work in linguistics.  Chomsky lays out our inheritances and predispositions as human beings, and how it all is just what it is.  Life just "is".  We can't fly, our language structures follow certain patterns, we coalesce around religious identities that we don't even necessarily believe in, life is kind of meaningless, we die and that is it.  This is being a human.

I understand the search for meaning because as a 32-year old, I just emerged from a decade of searching, travel, political action, and higher education.  The judgments of systems, of others, of self, and the striving for perfect integrity  is actually an attempt at control, superiority, and I think, in some ways, a stab at immortality. 

Despicable things happen.  Suffering is real.  It just is what it is.  We cannot save anything.  Life feeds on death.  Your life is incredibly short, and it is a miracle of chance that you are here.

I was a vegan for seven years.  I didn't want to be a part of the suffering of animals being enslaved, raped, milked, slaughtered.  I have pets, I know animals feel and experience life in ways that parallel our own. But you know what?  Being a vegan is shit for your health deprives you of nourishment that human beings have evolved with over millenia (b12 and other minerals, iron).    Life feeds on life.  When I die, something is going to feed on me.  Thems the breaks. No one asked me how the system should work so I work with what I have.

My family dog unexpectedly died this weekend.  Her stomach flipped.  She was alive and vibrant about 48-hours ago, and now her body is cold and beginning to decay who knows where. I will never run my fingers through her fur, or watch her delightedly chase a ball.  I never got to say goodbye.

This is life.  If you want to engender systematic change, good luck defeating chaos+evolution+entrenched systems.  However, you have some power (limited in its own right) to craft the circumstances of your own life and help those around you in the extremely short amount of time you are here.  Judging things as to whether or not they fit into some system of integrity is just bollocks at the end of the day.  It is what it is.  You can find it distasteful and disassociate yourself, or you can dig in and live your life and make the choices that feel right for you, and maybe spread some happiness and beauty along the way.

[Zikoris]

I was a vegan for seven years.  I didn't want to be a part of the suffering of animals being enslaved, raped, milked, slaughtered.  I have pets, I know animals feel and experience life in ways that parallel our own. But you know what?  Being a vegan is shit for your health.    Life feeds on life.  When I die, something is going to feed on me.  Thems the breaks. No one asked me how the system should work so I work with what I have.

Uh, what the hell? Many people are very healthy vegans - I've been vegan for just under 16 years myself with no issues. If you had health problems, it was due to your own bad choices, not something inherently wrong with the diet. You can be healthy or unhealthy on pretty much any diet depending what you eat on a day to day basis - other than the Standard American Diet, there's not really any diet that's inherently "shit for your health".

[swallowtail]

You probably built bone mass during your early years - you weren't a vegan as a child, correct?  I think for the most part an emphasis on plant based diets is fine, but from my research and experience, you are not going to get the quality of minerals, calcium, and iron from your diet as if you introduced even a small amount of animal products. 

I will amend my earlier comment to be less inflammatory.

[Zikoris]

You probably built bone mass during your early years - you weren't a vegan as a child, correct?  I think for the most part an emphasis on plant based diets is fine, but from my research and experience, you are not going to get the quality of minerals, calcium, and iron from your diet as if you introduced even a small amount of animal products. 

I will amend my earlier comment to be less inflammatory.

I went vegan when I was 12, so it depends if that counts as a child.

The American Dietetic Association's position on the matter is that a well-planned vegan diet is suitable for all stages of life, including infancy and childhood, based on the majority of research available on the topic. I think you would have stumbled across that if you did research?

Nutrition is really simple. You consume the vitamins, minerals, fats, etc that your body needs. It doesn't matter how you go about getting them.

[swallowtail]

I'm glad you have had success with not eating animal products.  I wish you a long and healthy life (and an abundant mustache).

[johnhenry]

And though I put a smiley on it before--the philosophy of MMM explicitly relies on the fact that you *can* accumulate enough capital to live on the income/proceeds, and that you *can* develop passive and unearned income, which depends on surplus and inequalities. That isn't wrong IMO; it's just how the world works.

You are right, our economic system is not unfair because it allows participants to ACCUMULATE capital or even that accumulated capital can produce income.  But the completely unfair part is: it allows HUGE amounts of wealth to be passed from generation to the next, so that some participants are not required to accumulate the CAPITAL they control.

I think icky is right to think that members of this forum, supposedly well-versed in personal finance, could see the inherent injustice in our system.  Members of this forum prove that it can take as little as 5-10 years of working and saving to control enough financial assets (tax credits) to comfortably meet all of ones obligations to society(taxes) and still provide a comfortable life for self and family in a first world country. Yet we live in a system where some participants can be born with a trust fund with hundreds or thousands times that value.  We've thrown off the silly yolk of the gold standard, when, to provision for the common good, the government had to actually borrow from those who already controlled wealth.  Yet this far into the era of fiat money we have still have citizens, rich and poor, mixing metaphors and acting as if one has as much right to be born a billionaire as he has to his constitutional rights.

I'm not content to say, well "it's just how the world works".   I'm not content to say, I was smart enough and worked hard enough to get mine, so I don't care about making the system fair, since it worked for me.  I sure as hell am not content with a system that allows my heirs to "own the obligations" of others by controlling the wealth I've accumulated.  I want them to owe just as much to society at the beginning of their journey as I did.

People, money is a creation of the state(government). Money can not be separated from the state.  We can print as much as we need.  As long as we(collectively) tax less than that, it leaves us all (individually) some amount to earn, trade, accumulate, invest. Yes, to do this there has to be a "national debt".

So yes, that's it. I've realized, you know what, it's actually kinda fed up that I'm totally capable of saving enough in 5-10 years to meet all of my needs. I mean, what is the real problem there? What if there's more than just the problem of inheritance? Is there actually not enough work for everyone? Are we only able to benefit in this way due to incredibly cheap labor in other places?

You seem to think (apologies if I'm misunderstanding) fiat money is mostly to blame? But wasn't gold just as arbitrary of a thing to place value on?

Is there a problem with accumulation? Is there such thing as too much? Maybe for some there isn't because they have big investments ideas and build things and do good, but thats not me. I get by with very little. I think, perhaps naively and optimistically, that the social "safety net" will be accessible to me if I ever need it. For me then, is there no real reason to accumulate?

I'm sorry if people think I'm not listening to their reasons. I am, and I do think that perhaps the best thing for me is still FI since that would free my time and give me more opportunities. It just doesn't seem so easy to decide on the investment vehicles to make that happen. I bike and bus, I eat a ton of rice and beans, I buy used, why would I turn around and then say, but ok, I'm going to go ahead and get 8% interest from all those things I'm rejecting in my daily life. (consumerism, wasteful environmental practices, unfair labor standards.)

icky, I do think you are misunderstanding.  This may be a good place to start.  A transcript from a presentation at a fiscal sustainability teach-in.
http://www.netrootsmass.net/fiscal-sustainability-teach-in-and-counter-conference/warren-mosler-the-deficit-the-debt-the-debt-to-gdp-ratio-the-grandchildren-and-government-economic-policy/

No, the problem is not at all fiat money.  The problem is the misguided fear of fiat money.  Fear of fiat money spreads easily among those who have managed to amass money.  That is because they know that "the government" can, by printing more money, basically devalue their savings.  It's a natural reaction to want to preserve what you've accumulated.  But those folks have never stepped through the thought process to understand that the money they have came from the government in the first place (or from a bank regulated by it).  I certainly don't know of any money that came from a different source.

Money has a lot in common with prisons.  They are both creations of the state, supplied to serve the public good.  Neither are inherently good nor evil.  And what they mean to each of us individually is determined by the laws we create and how we enforce those laws.  Those laws and their enforcement ultimately determine which of our citizens are incarcerated.  The point is, the devil is COMPLETELY in the details!!  There is nothing evil or unfair about prisons because they are completely controlled by the government.  Everyone has the sense to know that our society gets to determine, democratically (in the case of the US), why someone goes to prison and for how long.  To be sure, there are glaring injustices.  But that's why there is a debate going on as we speak about changing incarceration times for certain offenses, and for ensuring the laws are executed fairly, not just legislated fairly.  The laws and regulations regarding money are no different.  We are not going to solve any economic injustices or inefficiencies by taking control of money away from government, and the thought that it can even be done is laughable.  What sense does it make to link the value of money to some mineral in the earth, while the government still controls every other aspect of monetary and fiscal policy, except for how much of it there is!! 

[Spartana]

You probably built bone mass during your early years - you weren't a vegan as a child, correct?  I think for the most part an emphasis on plant based diets is fine, but from my research and experience, you are not going to get the quality of minerals, calcium, and iron from your diet as if you introduced even a small amount of animal products. 

I will amend my earlier comment to be less inflammatory.

I am in my early 50's, long term vegan and just had a bone density scan and, according to the Dr.,  have the bone density of a 25 year old and have increased my bone density by quite a bit since my last scan over 2 years ago. I attribute that to being athletic and doing load bearing exercises most of my life coupled with my vegan (and pretty much raw foods) diet. Lots of non-animal based food sources out there that can get you what you need IMHO.   Oops - sorry to derail the thread

[johnhenry]

This is going to be pretty basic:  I like this place and part of the reason is the politics lean somewhere towards localized libertarian.  Don't stress out and worry about shit you can't control  go and take personal responsibility and control the stuff you can.  Also understand that freedom is a simple math formula:

Money = Freedom
Buying stuff costs money
Therefore buying stuff costs freedom

But what about this????

If you acknowledge that:
a) money = freedom
b) government creates money

Then it follows that the government creates freedom.

Are you OK with a society where some citizens are granted more freedom than others?

[johnhenry]

Well if
Money=Freedom
Governments take money
Governments are the enemy of freedom.- Gee, considering the USA has 5% of the world population and 25% of the worlds prison population, that should be obvious.
Probably not too popular on here but a fan of very small governments.  Do not really want to fund blowing up brown guys around the world that the press tells me I should hate, nor a fan invading who knows where. Feed the hungry, educate the young, pave the roads, etc but the rest of it can go away. What you do in private should be your own business, not the governments,

squirrel, where did you get the money of yours that the government takes away?  Were you born with it?  Dig it out of the ground?  Of course, of course, you worked for it.  Where did your employer/customer/bank get the money from before they paid you with it? 

[chasesfish]

Money is a store of value.  Some is government created, some is not


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[johnhenry]

Money is a store of value.  Some is government created, some is not


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I know some folks who hold assets like real estate, gold, vehicles, etc.  And in some cases they hold these assets for the express purpose of retaining wealth or storing value.  But the last time I checked, all those folks knew the value of each asset measure in DOLLARS.  The dollars that the government allows us to pay our taxes with.  Those dollars are tax credits and that's one reason they are money and the others are not.

[johnhenry]

People, money is a creation of the state(government). Money can not be separated from the state.  We can print as much as we need.  As long as we(collectively) tax less than that, it leaves us all (individually) some amount to earn, trade, accumulate, invest. Yes, to do this there has to be a "national debt".

I'm relatively new around here, but surprised to see chartalist theories of money in this forum. Is this just your own position Johnhenry, or is this commonly held here?

Hey Nate.... welcome.  I still consider myself new here too, but I guess I have been around a while now.

Good question?  I don't recall seeing too much agreement from other members when the subject has come up before.  It's amazing, to me, how often it should come up though.  It's kind of weird for a community of people of be in (supposed) agreement about the best way to personally manage money, yet not be on the same page about "what money even is"!! 

I certainly haven't seen anyone else use the term chartalist here.  I am aware of the theory and in my mind, there isn't really a better way to explain what money is.  On one hand, it's so simple it seems but one step above common sense.  But on the other, I'm a lifelong student of money and economics and I was in my late 20s before the chartalist view really found it's way to me.  So I guess I shouldn't be surprised that it's not more widespread.

I think I posted a link to this PDF a while back on this forum:  http://www.levyinstitute.org/pubs/wp_658.pdf

I think it's one of the most straightforward places to start, especially for non-economists.  A great extension of Keynes for the post-hard currency era.

What's your story?

Oh very cool! I'm actually an economist and sympathetic to the post Keynesian approach in general (actually I have a working paper in the Levy Institute working paper series). I would whole-heartedly agree that with your earlier point that money is inherently political.

I think this is way off topic. However, I have one question: how does the apparently simple solution of the sovereign taxing away the intergenerational transfer of wealth square with the interest of the sovereign to insulate economic activity from the unpredictable effects of individual mortality? When should it kick in etc.? Maybe you want to open another thread regarding this interesting question.

A good starting point point would be to consider the interest of the sovereign in an economy which is able to supply the necessary means to assert his power whenever needed with particular attention to the the fact that the ultimate objective of the the sovereign is to assert his sovereignty.

On another note, I don't think you are going to find much objection to your theory of the nature of money on this forum because it is not populated by crackpots - hence the lack of resonance to your postings.

Pete, regarding your question about the government needing to worry about individual mortality.  It doesn't need to concern itself any time that taxes are paid.  That's because (sovereign, currency issuing) government does not borrow from nor tax it's citizens to fund it's expenses.  It just creates money when it needs it.

It works just as it does when you pay back a loan from your bank.  The principal amount does not "go anywhere".  It just cancels out the obligation you had to the bank.  Your taxes don't really fund social security or wars in the middle east.  They just cancel out your tax obligation for that year.  If the government needs money for those other endeavors, it creates it.  By directly crediting bank accounts of SS recipients, or soldiers, or military contractors as the case may be.

The specific discussion about inheritance taxes is just an example.  I'm not claiming that higher inheritance taxes will solve all the problems.  I'm just using those scenarios to help people see money for what it is.  A public monopoly.  A creation of the state that is inseparable from the state, from law, and from politics.

[icky]

And though I put a smiley on it before--the philosophy of MMM explicitly relies on the fact that you *can* accumulate enough capital to live on the income/proceeds, and that you *can* develop passive and unearned income, which depends on surplus and inequalities. That isn't wrong IMO; it's just how the world works.

You are right, our economic system is not unfair because it allows participants to ACCUMULATE capital or even that accumulated capital can produce income.  But the completely unfair part is: it allows HUGE amounts of wealth to be passed from generation to the next, so that some participants are not required to accumulate the CAPITAL they control.

I think icky is right to think that members of this forum, supposedly well-versed in personal finance, could see the inherent injustice in our system.  Members of this forum prove that it can take as little as 5-10 years of working and saving to control enough financial assets (tax credits) to comfortably meet all of ones obligations to society(taxes) and still provide a comfortable life for self and family in a first world country. Yet we live in a system where some participants can be born with a trust fund with hundreds or thousands times that value.  We've thrown off the silly yolk of the gold standard, when, to provision for the common good, the government had to actually borrow from those who already controlled wealth.  Yet this far into the era of fiat money we have still have citizens, rich and poor, mixing metaphors and acting as if one has as much right to be born a billionaire as he has to his constitutional rights.

I'm not content to say, well "it's just how the world works".   I'm not content to say, I was smart enough and worked hard enough to get mine, so I don't care about making the system fair, since it worked for me.  I sure as hell am not content with a system that allows my heirs to "own the obligations" of others by controlling the wealth I've accumulated.  I want them to owe just as much to society at the beginning of their journey as I did.

People, money is a creation of the state(government). Money can not be separated from the state.  We can print as much as we need.  As long as we(collectively) tax less than that, it leaves us all (individually) some amount to earn, trade, accumulate, invest. Yes, to do this there has to be a "national debt".

So yes, that's it. I've realized, you know what, it's actually kinda fed up that I'm totally capable of saving enough in 5-10 years to meet all of my needs. I mean, what is the real problem there? What if there's more than just the problem of inheritance? Is there actually not enough work for everyone? Are we only able to benefit in this way due to incredibly cheap labor in other places?

You seem to think (apologies if I'm misunderstanding) fiat money is mostly to blame? But wasn't gold just as arbitrary of a thing to place value on?

Is there a problem with accumulation? Is there such thing as too much? Maybe for some there isn't because they have big investments ideas and build things and do good, but thats not me. I get by with very little. I think, perhaps naively and optimistically, that the social "safety net" will be accessible to me if I ever need it. For me then, is there no real reason to accumulate?

I'm sorry if people think I'm not listening to their reasons. I am, and I do think that perhaps the best thing for me is still FI since that would free my time and give me more opportunities. It just doesn't seem so easy to decide on the investment vehicles to make that happen. I bike and bus, I eat a ton of rice and beans, I buy used, why would I turn around and then say, but ok, I'm going to go ahead and get 8% interest from all those things I'm rejecting in my daily life. (consumerism, wasteful environmental practices, unfair labor standards.)

icky, I do think you are misunderstanding.  This may be a good place to start.  A transcript from a presentation at a fiscal sustainability teach-in.
http://www.netrootsmass.net/fiscal-sustainability-teach-in-and-counter-conference/warren-mosler-the-deficit-the-debt-the-debt-to-gdp-ratio-the-grandchildren-and-government-economic-policy/

No, the problem is not at all fiat money.  The problem is the misguided fear of fiat money.  Fear of fiat money spreads easily among those who have managed to amass money.  That is because they know that "the government" can, by printing more money, basically devalue their savings.  It's a natural reaction to want to preserve what you've accumulated.  But those folks have never stepped through the thought process to understand that the money they have came from the government in the first place (or from a bank regulated by it).  I certainly don't know of any money that came from a different source.

Money has a lot in common with prisons.  They are both creations of the state, supplied to serve the public good.  Neither are inherently good nor evil.  And what they mean to each of us individually is determined by the laws we create and how we enforce those laws.  Those laws and their enforcement ultimately determine which of our citizens are incarcerated.  The point is, the devil is COMPLETELY in the details!!  There is nothing evil or unfair about prisons because they are completely controlled by the government.  Everyone has the sense to know that our society gets to determine, democratically (in the case of the US), why someone goes to prison and for how long.  To be sure, there are glaring injustices.  But that's why there is a debate going on as we speak about changing incarceration times for certain offenses, and for ensuring the laws are executed fairly, not just legislated fairly.  The laws and regulations regarding money are no different.  We are not going to solve any economic injustices or inefficiencies by taking control of money away from government, and the thought that it can even be done is laughable.  What sense does it make to link the value of money to some mineral in the earth, while the government still controls every other aspect of monetary and fiscal policy, except for how much of it there is!!

Phew, ok, I watched that video. I think I'm getting it more. I think you're right in that if I'm going to really be able to sort out my feelings about investments, I really need to understand the economy as it is today.

I really appreciate you taking the time to try to explain this. It does expand my thoughts. I kinda see what you're saying in that the problem isn't what I have saved, or what anyone has saved in dollars, it's more that we aren't taxing wisely and distributing dollars in ways that adequately provision for our people. I think it reenforces in me I want to be an advocate for fair labor laws and free education. I also want to be an example of how little "provisions" each person actually truly needs, and to show, its not all that much and we can do it and get everyone there up to some basic standard (at least in this country) if we  tried.

I think freedom comes not from money, but from education and the knowledge that you have the power to demand others to treat your life with dignity.

Still not sure about my investments, haha, but at least I see that it doesn't matter so much. I need to make sure I'm contributing to the system with my time and brain power, and that I spend my money in ways that fit with my politics. What I have saved can't be my main focus for any kind of political statement or action. Perhaps I could view it as my main drive for FI is a demonstration of the available excess in our current system.

[chasesfish]

Btw:  I'm going to opt out of further comments.  Someone else said this best, this is a nice torus with a combination of hippies and libertarians.  I'm so close to FI that I really don't care as much about politics now.  I'll leave that to others


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[mozar]

You got it! (wipes tear from eye corner)
And I'm impressed by this forum, for not giving up.

[icky]

If anyone else can suggest ways for a woman to be safe in this world without having money, I'd be interested to hear what they are.

There are plenty of communes I think are pretty safe. Also, I feel a college education makes females pretty safe since earning their own money becomes easier and possible, which even if everything earned must be spent grants safety. Also, there are completely separatist female communes.

http://www.nytimes.com/2009/02/01/fashion/01womyn.html?pagewanted=1&_r=2&emc=eta1&

The book "Possum Living" explains how an 18 year old girl lived with basically no money by raising rabbits and fishing and doing odd jobs of babysitting and such. It's certainly possible in America with the correct circumstances.

And I wouldn't really say nuns live without money, they live on money provided to them by a patriarchy, which is often threatened to be taken away if they get too out of order:
http://radicalgracefilm.com

[Prairie Stash]

New thread, ignoring that pesky, dirty and "hostile", feminist word:

Is mustachianism just a more socially palatable form of the socialist/anarchist fight against wage slavery? MMM doesn't politicize anything and makes lots of jokes, so therefore his writings become highly clickable and accepted around on the internet echo chamber. Jacob's ERE was popular, but less so, because he had more extreme ideas.

As much as you personally hate my politics/personality or whatever, please attempt to answer this question earnestly, all other responses will be ignored:

If you find being paid a salary for a 40-hour work-week so abhorrent as to not want to do it, and also have the opportunity to not do it, do you have any responsibility to stand up and figure out ways to fight against that form of oppression for all humans? If you do not find making a salary and working within a heirarchy unpleasurable and soul-numbing, why the push for "financial independence"?

There's one problem with your question IMO, the assumption that work stops at 40 hours/week and stops at FI.  FI means the option of your current employment, for most though work still continues in a new form.  Re-read tales of FI and you’ll see most people are still active and contributing to society in new forms. In a lot of cases they are contributing more in FI then they did while working. This forum for example, MMM was just another software guy before FI and is now helping others.  Once he got FI dealt with he was more capable of instituting change than any of his peers, pretty cool trick.

Mustachianism at its core is about living better! Money is just an obstacle that people frequently get confused about. From the start it’s about getting your life to a better place, you can decide what a better life means to you.

FI is just another tool to allow people flexibility to improve the world, it’s not a movement. It’s not an end goal. It’s just a glib definition to show progression from one stage of life to another. If FI won’t allow you to reach your goals easier/quicker/more effectively then it’s irrelevant. 

Do you have any goal(s) in life? Is there anything that makes you passionate that you could devote your life to? I have goals and passions; I have a reason for FI, that’s my push.

[Spartana]

If anyone else can suggest ways for a woman to be safe in this world without having money, I'd be interested to hear what they are.

http://www.peacepilgrim.org/
http://www.odditycentral.com/news/woman-hasnt-used-money-in-15-years.html

and many others doing things in life - often in dangerous places - with little money. Living with out money, or with little money, can be safe for women. I'm sure that many of us here have spent long periods of time off camping, backpacking, bike touring, etc... alone with no problems.  Don't see why it would be any more dangerous to do it full time then it would while on extended vacations. And you can always arm yourself to the teeth if that makes you feel more comfortable :-)!

[kite]

If anyone else can suggest ways for a woman to be safe in this world without having money, I'd be interested to hear what they are.

http://www.peacepilgrim.org/
http://www.odditycentral.com/news/woman-hasnt-used-money-in-15-years.html

and many others doing things in life - often in dangerous places - with little money. Living with out money, or with little money, can be safe for women. I'm sure that many of us here have spent long periods of time off camping, backpacking, bike touring, etc... alone with no problems.  Don't see why it would be any more dangerous to do it full time then it would while on extended vacations. And you can always arm yourself to the teeth if that makes you feel more comfortable :-)!

Those are nice stories,  but lucky is not the same thing as safe.   Money,  like the vote or education,  is a tool.   And you are more vulnerable when you lack (or are deprived of) the most useful tool that everyone else possesses.  Historically, this has been true for women and blacks in America,  and is true for other groups in other places.   It is not safe to be at the mercy of and dependent upon the benevolence of others.   

[former player]

If anyone else can suggest ways for a woman to be safe in this world without having money, I'd be interested to hear what they are.

http://www.peacepilgrim.org/
http://www.odditycentral.com/news/woman-hasnt-used-money-in-15-years.html

and many others doing things in life - often in dangerous places - with little money. Living with out money, or with little money, can be safe for women. I'm sure that many of us here have spent long periods of time off camping, backpacking, bike touring, etc... alone with no problems.  Don't see why it would be any more dangerous to do it full time then it would while on extended vacations. And you can always arm yourself to the teeth if that makes you feel more comfortable :-)!

Those are nice stories,  but lucky is not the same thing as safe.   Money,  like the vote or education,  is a tool.   And you are more vulnerable when you lack (or are deprived of) the most useful tool that everyone else possesses.  Historically, this has been true for women and blacks in America,  and is true for other groups in other places.   It is not safe to be at the mercy of and dependent upon the benevolence of others.

Agreed.  One point that stood out for me in the various links given was that the woman who has not used money in 15 years has no health care and relies on "the power of self-healing".  Which is of course fine as long as she is healthy.  And while we can all work on looking after our own health and hope for the best, sometimes bad things happen even to people who look after their own health.  None of the links seemed to talk much about coping with disability or a frail old age, other than the commune who were concerned about the need to raise money for future hospice care. 

Having no money is doable for someone who is fit and strong, which for some can last well into the traditional retirement age.  Being disabled or otherwise frail with no money is a level of vulnerability at which there are no guarantees of a good outcome but having money does up the odds of staying in reasonably comfortable circumstances with as near a guarantee as possible of having good people to help out.  I'm spending this week helping one centenarian and two nonagenarians to have a holiday together.  They all have disabilities, but have enough money to own comfortable housing, put in the necessary adaptations and employ the help they need to lead a life which includes good food, visits/a bit of travel and companionship.  Without money, at best they would each by now be in a government owned old people's home with no choice of companions, no home-cooked food, no restaurant trips, and one at least would have no-one able or ready to take them out of the home for any purpose.  It would be close to being in prison.

[johnhenry]

Btw:  I'm going to opt out of further comments.  Someone else said this best, this is a nice torus with a combination of hippies and libertarians.  I'm so close to FI that I really don't care as much about politics now.  I'll leave that to others


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That's fair enough.  I love being a part of this forum not because of the political leanings of the members, but because it's full of great advice from people who walk the FIRE walk, not just talk the talk.  I have successfully reached FIRE, and I love sharing what I've learned.  My main purpose for participating in this forum is to learn a lot (and teach a little) where personal finance and FIRE are concerned.  I'm not here to talk politics, in general. (But I'm glad to participate in this thread).

But I do want to clearly address the forum on one point: The accurate understanding of what money is and how it works (in America and other sovereign, currency-issuing nations).

Politics is a discussion about which resources should be provisioned, from the private sector, to serve the public purpose. Reasonable minds can disagree about that all day long.

But the mechanics of how that happens is not in question, it's prescribed by law.  Yes, there are hairy, complex details.  But as a whole, the system is not difficult to comprehend. Modern Monetary Dynamics (aka Modern Monetary Theory), accurately and completely describes the process.  We are all here to either teach or learn, so if someone makes a false claim, they need to be called out on it.  Whether it's a claim about an IRS regulation regarding capital gains tax or a claim that our government is borrowing money (rather than creating it), the record needs to be set straight. 

I'll be the first to admit, when it comes to achieving FIRE goals, it's not really important to understand MMT in order to succeed.  After all, you don't really need to know what money is to make it or save it or invest it.  But it's imperative that you understand it before you develop a political position.  It's pointless to have a discussion about political change if you don't understand the real status quo.

For those interested, there's a good primer here:  http://neweconomicperspectives.org/modern-monetary-theory-primer.html

For those on the fence, including those who think this is some theory pushed by "crackpots" on the fringe.  Here are two links that pretty much sum up how well this subject is understood in America today.  The first document is a product of our government.  Specifically, the National Commission on Fiscal Responsibility and Reform.  Read the preamble even if you skip the details.  It epitomizes the stance most American's take, even though they can't exactly tell you why.  "We've got to reduce the deficit, so we don't go broke."  If you believe that, you owe it to yourself and others on this forum to expand your understanding.

http://www.fiscalcommission.gov/sites/fiscalcommission.gov/files/documents/TheMomentofTruth12_1_2010.pdf


And here's a statement to the deficit reduction commission from economist James K. Galbraith and others.  They don't just tell the commission they are wrong.  They tell them why they are wrong.  See section 9.

http://www.nextnewdeal.net/wp-content/uploads/2010/06/deficitcommissionrv.pdf


Both these documents are from 2010.  This stuff is not new.  And the dialog is taking place between our government representatives at the highest levels and economists educated at Harvard and Yale.  This is not being pushed by "crackpot" theorists.

[pka222]

Hey All
there are a few US-centric terms used in this and other threads that ... well sound real antiquated outside the US, for good reason.
Try these *new and improved* terms on for size

Instead of saying "third world country" with is patronizing and demeaning simultaneously- use developing county (Mexico) or least developed country  (Chad or PNG)
http://en.wikipedia.org/wiki/Least_developed_country

Global warming .. is a misnomer - the real term used by everyone outside the US uses -Climate Change or anthropogenic Climate Change
http://www.ipcc.ch/

happy days

[aschmidt2930]

I've also spent time reflecting on how I feel about investing in unethical companies, and profiting off destructive business operations.  It's a tricky question, but here's the conclusion I came to:

Taking a step back and looking at the big picture, we need to think about why companies offer stock in the first place.  They offer stock to raise money to execute business plans.  These plans can be anything, but they are frequently designed around growth.  Adding jobs, expanding operations into new markets, infrastructure upgrades, ect.  When companies have the capital to execute, more people become employed.  Domestically and internationally, especially in emerging markets.  By supporting growth, you give others the opportunity to achieve FI.

One other thing that's key is that despite what many people seem to believe, money, and wealth, are NOT zero-sum games.  In other words, you having money/assets does not automatically mean that somebody else has less.  Money is not a resource with a set volume that can be divided equally and justly over the long-term.  It's why Robin Hood is a fairy tale and not a successful economic strategy (Although many have tried).  Wealth is constantly being created or destroyed.   The world is wealthier than it's ever been, and that's occurred through value creation.  When people (Using companies as vehicles) create value, the real amount of wealth in the world increases.  By investing in successful companies, you're enabling talented people to create value, and thus making the world wealthier. 

To summarize the above into a philosophy:  Creating value for others creates wealth.  By enabling (Investing) those creating value, you speed the global push towards prosperity forward.

[johnhenry]

One other thing that's key is that despite what many people seem to believe, money, and wealth, are NOT zero-sum games.  In other words, you having money/assets does not automatically mean that somebody else has less. 

This is technically true, but what is the point that you are trying to make??  Why is it key??  It is true that even the poorest of Americans live more comfortable lives than nearly all of humanity lived just a few centuries ago. Yes, it's true that a rising tide lifts all boats.  We are all able to live more comfortable lives than our distant ancestors because our society stands on the shoulders of all generations past. 

To me that fact is useless in determining economic/monetary policy for our government.  Because to me, it's more important for government to provide each citizen with an equal opportunity than a comfortable existence.

Political equality is meaningless in the face of economic inequality!!  It's true that wealth is not a zero sum game.  But it's also true that relative wealth matters!!  If you give a professional poker player a super-short stack of chips against a room full of mediocre players with huge stacks, he'll get pushed out of the game early nearly every time!!  If you sit down to play a turn of Monopoly for your cousin who's taking a restroom break... you can't be sure where you stand in the game by looking only at your stack of cash and your holdings on the board.  You have to know how your assets stack up against the competition before you know anything!

What do each of us owe to our society? The question is a hard one.  And an open-ended one.  But recognition that we all live more comfortably compared to humans in centuries past, does not help answer the question. 

Money is not a resource with a set volume that can be divided equally and justly over the long-term.

We probably agree that humans have different capacities and desires to provide valuable goods and services to their fellow citizens. And we probably agree that if each citizen were paid a government stipend and then taxed 25% of that stipend, in short order, some would amass huge savings and others would live in poverty.  But to acknowledge that is only recognizing a little biology!!  It doesn't make any stride towards determining what role the government should play.  And no, it's not acceptable to propose that the government just "stay out of it".  When government creates the stuff and demands tax payments using it, it is impossible to stay neutral.

Our government has complete control over the supply of money through the money it creates through direct payments (social security, military contracts, soldiers pay), and through money it destroys, through taxation (which can be targeted at rich, poor, homeowners, business owners, retirees, those with income, those with wealth, etc), and finally through bank regulation.

It's not the job of government to count up all of the assets, monetary and otherwise, of all citizens and make some attempt to distribute those assets equally!  We agree that this is a fools errand (and not the job of government).

But it is the job of government to determine each citizen's obligation to the group.  That's what taxes are for.  But citizens must have something to pay taxes with.  That's what money is for.

[icky]

I found this article really interesting. It's a panel debating why Thomas Pickettys book was so popular this summer.


One guess near the bottom resonated with me:

"My guess is that the book-buying upper-middle class of America today is greatly distressed when it looks at the world around it, specifically at two things.

The first is that our society today is largely failing its non-migrant non-college-completing majority, in that for all of our cheap electronic toys, life is no easier than it was a generation ago in spite of an enormous explosion of technology and productivity.

The second is that they now know of a plutocracy that did not use to exist and makes us very uneasy."

Pickettys premise seems mustachianism to me, and that is, invested capital grows faster than income. MMM points out that even modest income folks have a shot at this type of capital growth if they manage to cut expenses.

I'm still having issues with this core problem, if you've managed to cut expenses, how much capital do you truly need? Is it "right" (as in moral) that one is able to save enough to live off of for a lifetime in just a few years (largely thanks to tax advantages and an excellent education)? I understand its an individual problem, but I don't think our current tax, political and education system is set up to help anyone determine this. People can bemoan me and say I don't know what I'm talking about, but still, you have a citizen (and I KNOW there are others like me) whos saying, here, I have all I need. Tell me what to do. I want this to be more fair.

I don't want to be justified in saying I MIGHT have a sick child one day and I MIGHT need it. There should be a safety net for that. I shouldn't have to save huge amounts due to potential calamities, calamities are supposed to be rare.

Income inequality is just as big of problem as civil rights or womans rights, and I don't want to be sitting back saying, "well the worlds not fair, there's nothing I can do to change it" as I keep squirreling away my excess.

As for charities, etc. As I said before, I give away much of my income to charities (water and a midwife clinic in haiti) and gifts to others and I volunteer my time at a local community center teaching English. On top of this, I'm a public employee who works hard and puts in more than I take out. (and make less than I could privately.) My problem is not a problem of VALUES or MEANING.

But no, I don't particularly like having to arrive at a windowless building each day on the dot and tell others of my whereabouts at all times. I don't like that I can't use energy levels and seasons to determine my work flow. I don't like working even when my brother is very ill but I'm out of sick days. I don't like not having time for a bigger garden and more time with extended family and more time to make more from-scratch meals. So for my maximum happiness, I should just save and get out. But if I decide to go that route, I think its a fair debate to discuss whether this option is something that should be available to all. And for those that have achieved it, the debate seems essential.

[arebelspy]

I don't want to be justified in saying I MIGHT have a sick child one day and I MIGHT need it. There should be a safety net for that. I shouldn't have to save huge amounts due to potential calamities, calamities are supposed to be rare.

(Emphasis added.)

Yes, there should be.

But is there?  I'd argue no, not an adequate one.  So yes, it is up to you to provide that for your child, if you choose to bring one into the world (or adopt one, or whatever).

It'd be nice if the world matched up with our vision of how it "should" be.  But often times it doesn't, and so we need to make provisions for that.

I agree with what I think is your underlying premise though, that one ought to question what is "enough" and hoarding past that for selfish purposes isn't ethical.

[MandalayVA]

But no, I don't particularly like having to arrive at a windowless building each day on the dot and tell others of my whereabouts at all times. I don't like that I can't use energy levels and seasons to determine my work flow. I don't like working even when my brother is very ill but I'm out of sick days. I don't like not having time for a bigger garden and more time with extended family and more time to make more from-scratch meals. So for my maximum happiness, I should just save and get out. But if I decide to go that route, I think its a fair debate to discuss whether this option is something that should be available to all. And for those that have achieved it, the debate seems essential.

It is available to all--but one must choose to take the opportunity.  I work in a super-corporate environment and every day I hear people moaning and bitching about their jobs or their managers ... and the next moment they're talking about the cute new shoes or the new car or iPhone they want to buy.  When I see their family pictures I am staggered by the sheer amount of stuff in their houses--knick-knacks everywhere, walls covered with pictures, rooms stuffed with furniture.  Whenever there's a retirement party--which is pretty frequent given the number of old-timers around here; I will say I've never seen anyone younger than 62 going, though--there are jealous looks and mutters of "gee, I wish I could retire."  They traded freedom for stuff.  Simple as that. 

[johnhenry]

So for my maximum happiness, I should just save and get out. But if I decide to go that route, I think its a fair debate to discuss whether this option is something that should be available to all. And for those that have achieved it, the debate seems essential.

icky, I agree completely.  I've played the game and I've won.  I've reached FIRE in my early 30s.  As FIRE grew near for me, I began to think less about what I needed to do to play the game successfully and more about how to make the game more fair for everyone.  Over the past few years I've come to realize something very dis-heartening.  Our country can't move forward with a meaningful political debate about the role of government, because we can't even agree on the framework in which to have the discussion!  Even this forum, which is full of folks who have a knack for managing personal finances successfully, are completely in the dark about what money really is in a modern state!  I'm not ashamed of my fellow mustachians, but I do wish better for them.

As someone with progressive political ideas, you need to read this:  http://neweconomicperspectives.org/2014/09/framing-mmt-modern-money-network.html

It's not a discussion about what political course we should take.  Just about laying the appropriate groundwork before we even start the discussion.  To be clear, this is targeted at those with progressive political ideas.  There is plenty of documentation on what money is and how it works.  This paper is about convincing those who don't understand.

Those of us who would like to advance progressive ideas don't stand a chance today, because a false framework of the very nature of money gets in the way of real issues.  For example, we can't have a meaningful discussion about social security reform because conservatives and liberals agree that the "trust fund" will soon run out of money, and if we spend more now, we'll just put our grandchildren in debt.

Mark my words.  There will be a day in our lifetime when the public will discard the old, inaccurate framework of government-borrowed money and replace it with one of government-created money.  The sooner we all understand it, the sooner we can decide which direction to go and start moving.

PS
I think that understanding Modern Monetary Dynamics today is like understanding relativity shortly after Einstein explained it to the world.  His new way of describing the natural world required a new way of thinking about the world that just didn't make sense to those trained in Newtonian physics.  At first, there was significant pushback from those trained in classical theories. It took a while before academic curriculum got the information conveyed through public education.  The frustrating thing to those of us interested in economic education is: The world has been off the gold standard since the early 70s and the world is just starting to develop a way of describing money that isn't completely wrong or based on gold-standard theory that simply isn't relevant.  Yet we were building atomic bombs within a few years of Einstein's enlightenment.