The left flunks Econ 101- Zogby Survey says

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Who is better informed about the policy choices facing the country—liberals, conservatives or libertarians? According to a Zogby International survey that I write about in the May issue of Econ Journal Watch, the answer is unequivocal: The left flunks Econ 101.

Zogby researcher Zeljka Buturovic and I considered the 4,835 respondents' (all American adults) answers to eight survey questions about basic economics. We also asked the respondents about their political leanings: progressive/very liberal; liberal; moderate; conservative; very conservative; and libertarian.

Shocking, I tell you. And to think, the places run by the left (California, New York, Michigan, etc.) are doing so well economically.

Yeah-uh.

California's spending exceeded its revenues by 10% every year and raised taxes to make up the deficit. So then the economy turned down and they again raised their spending. So the shortfall was not ten percent, but rather 20%.

AND THEN, California STILL DIDN'T REDUCE SPENDING, so the next year, with an even worse economy, the deficit was 30%. On top of the previous shortfalls that they never made up. So, in addition to running annual deficits, they also have taken on debt that they cannot pay back!

AND THEN, one of the innerlechules in California sued in court and the water to their farms was shut off and all the crops and trees dried up and died. Gotta protect the 3" smelt. Which was probably not in any danger. But in the meanwhile, California agriculture now has farms with no employment and no tax payments.

When your basic government budget is $100 BILLION per year, you can see how fast you fall into a hole.

And New York and New Jersey and New York City are in the same situation.

Well, du-uh!!

If these were corporations like ... GM? ... then they would have to reorganize under the bankruptcy laws.

However, the president seemed to imply that if you don't have enough revenue, you apply for a grant. [Huh? Private companies/corporations don't have the luxury of applying for a grant; although, nowadays, I guess GM can do exactly that.]

Probably one of the most dishonest surveys ever performed:

fivethirtyeight.com/2010/06/are-you-smarter-than-george-mason.html

Americans are woefully ignorant of many things, including economics. But the right promotes economic ignorance - for example, the widely touted sophistry that cutting taxes typically increases government revenues.

Then there is this:

"8. Minimum wage laws raise unemployment.
• Unenlightened: Disagree"

A 2000 survey by Dan Fuller and Doris Geide-Stevenson reports that of a sample of 308 American Economic Association economists, 45.6% fully agreed with the statement, "a minimum wage increases unemployment among young and unskilled workers", 27.9% agreed with provisos, and 26.5% disagreed

en.wikipedia.org/wiki/Minimum_wage#Card_and_Krueger

The question turns on whether you accept the conclusions of Krueger and Card, who argued that the minimum wage increases employment:

press.princeton.edu/titles/5632.html

Some leading economists such as Greg Mankiw, Kevin M. Murphy and Nobel laureate Gary Becker do not accept the Card/Krueger results,[51][52] while some others, like Nobel laureates Paul Krugman[53] and Joseph Stiglitz do accept them as correct.

en.wikipedia.org/wiki/Minimum_wage#Card_and_Krueger

How does agreeing with a couple of Nobel Laureates and 26% of economics make a person unacceptably ignorant?

They don't say cut taxes; they say to cut incremental tax rates. [Sometimes, they talk in shorthand; you need to know the lingo of business.]

When you cut the percent tax rate on capital gains, then more people will sell stocks, take their capital gains and pay more capital gains taxes.

When you raise the capital gains taxes, then people will not sell stocks on which they have profits - the shareholders will hold the stocks instead of selling them.

When you cut corporate income tax rates, it allows the corporations to have more money to invest in plant and equipment. Those investments are productive and result in higher profits and the companies then pay more money in taxes. With higher revenues, they hire more people and those people pay more taxes.

This is totally absurd. Keynesian economists wrote Economics 101 and now they are blaming the left for not studying it? These guys think the Federal Reserve deserves credit for saving the economy while one side talks less government and the other side talks less corporatism. Total joke.

those 8 questions were designed to get the results reported. just take a look at them.

I did. I can see where three of the questions could be argued (6-8), but the others are pretty straightforward, basic economics. Considering progressive/liberals averaged 5.26 wrong, I’m assuming they didn’t know the answers to at least 2 out of the 5 straightforward questions.

Anyway, I take it this means liberals won’t be quoting Zogby poll information anymore, as they are obviously a conservative pollster. :rolleyes: :stuck_out_tongue:

If you have labor that is inexperienced and unskilled and you pay them the minimum wage and the cost per hour goes up [if they raise the minimum wage], then depending on your cost structure, you will try to reduce the number of hours to keep your total labor cost within some boundaries. Not everybody can increase their prices to compensate for increased labor cost.

Unless, you have some kind of productivity enhancements. In that case, you might be able to increase your total sales revenue and volume of product and the increased volume will result in increased revenue which will offset the increased labor cost.

When a company has people getting the minimum wage, and if the minimum wage is increased, then, in general, all of the other wages will also be increased on a comparable basis.

On the other hand, some companies may pay more than the minimum wage for entry level positions. If they do, it may be because they value certain traits such as reliability or adaptability. People working there may realize they are getting more and will perform better because they don't want to work at a place that pays less.

You need to look at each company. Everybody has a different cost structure.

Meanwhile, the individuals can improve their own situation by getting better educated in fields that pay more. You may start out flipping burgers, but if you go to school and learn how to program computers, then you may be able to upgrade yourself and command a higher wage. Like everything else, it depends. If you study a programming language that has become obsolete, then you may not find any jobs in that field. If you have a hobby of inventing computer games, then you may easily turn the hobby into a well-paying job.

You don't HAVE to go to school, but it's a really good idea ... IMHO,

I know a fellow who LOVES retail sales. He says he started working when he was eight years old. LOVES dealing. I guess he has a head for math so he knows what his costs and his expenses are. But has done well for decades.

So, you can start your own business. There was one fellow who did well, but he couldn't rent a car because he was too young. He had to hire people to drive him around; for a while, he hired his mom to drive him around, but she got tired of it.

I know a couple of kids who started their own computer businesses. They have done extremely well.

You need to be flexible.

It depends.

Each situation is different.

But any cost that goes up is a potential danger to a company's cost structure. It could be the cost of electricity or rent or delivery cost or labor cost.

[quote="rlg94086, post:8, topic:201336"]
I did. I can see where three of the questions could be argued (6-8), but the others are pretty straightforward, basic economics.

[/quote]

Seriously? How about this question:

5) Third World workers working for American companies overseas are being exploited (unenlightened answer: agree).

I would have zero idea how to answer that question because I don't know what it means. Is it confined to workers directly contracting with American companies? Or workers working for subcontractors (as if more often the case)? Since when does the word "exploited" have an accepted economic definition? Does exploited mean that they have experienced no increase in living standards, or that their wages are still pretty miserable by American standards, or does it mean they are breathing harmful chemicals? Is it asking whether a majority of third world workers are exploited, or just a significant number?

[quote="ProVobis, post:6, topic:201336"]
This is totally absurd. Keynesian economists wrote Economics 101 and now they are blaming the left for not studying it? These guys think the Federal Reserve deserves credit for saving the economy while one side talks less government and the other side talks less corporatism. Total joke.

[/quote]

Sounds like the economy has four sides.

No, seriously, actually, Adam Smith wrote economics 101. Supply and demand and all that.

adamsmith.org/blog/

You can also read Henry Hazlitt, and Mises and the Austrian school and all that.

And also, go here, for FEE, which is an outstanding organization for economic education:

fee.org/events/web-event-w-max-borders/

FEE stands for Foundation for Economic Education

Also visit www.aier.org

Keynes argued for spending money you don't have, in order to stimulate the economy. Unfortunately, that doesn't really work out. Spending money you don't have tends to be unproductive spending. When the money is gone, it is gone. There are no profits to carry the enterprise after the money is spent. What happens is that the deficits create a demand for bigger deficits and the economy gets worse and worse and worse. Kind of like an addiction to cocaine.

[quote="rlg94086, post:8, topic:201336"]

Anyway, I take it this means liberals won't be quoting Zogby poll information anymore, as they are obviously a conservative pollster. :rolleyes: :p

[/quote]

Zogby's been on the outs with liberals for some time, after the Ziegler poll:

blogs.wsj.com/numbersguy/zogbys-misleading-poll-of-obama-voters-459/

[quote="JusDaFacts, post:4, topic:201336"]
Probably one of the most dishonest surveys ever performed:

... The question turns on whether you accept the conclusions of Krueger and Card, who argued that the minimum wage increases employment:

A 2000 survey by Dan Fuller and Doris Geide-Stevenson reports that of a sample of 308 American Economic Association economists, 45.6% fully agreed with the statement, "a minimum wage increases unemployment among young and unskilled workers", 27.9% agreed with provisos, and 26.5% disagree.

[/quote]

My wife and I run a small business. When the minimum wage increases, we have to reduce the hours our employees work. We have no choice. Our revenue does not increase just because the government raises the minimum wage. I figured that out all by myself, and I'm not even a member of the American Economic Association.

[quote="RWMorris, post:13, topic:201336"]
My wife and I run a small business. When the minimum wage increases, we have to reduce the hours our employees work. We have no choice. Our revenue does not increase just because the government raises the minimum wage. I figured that out all by myself, and I'm not even a member of the American Economic Association.

[/quote]

If you were a member of the American Economic Association, you would consider whether the loss of employment in some businesses/sectors was offset by gains in the economy from the minimum wage workers spending their additional dollars, and whether those additional dollars had any significant inflationary effect if the minimum wage had not kept pace with inflation, whether the increased wage had any effect on worker productivity, and then you might do a statistical analysis based on the many states that have raised the minimum wage over the years to determine its actual effect throughout the economy, rather than relying on anecdotal information from a single business.

But that's not really the point. The point is that you can't call someone unacceptably ignorant if 25% of the experts agree.

[quote="JusDaFacts, post:14, topic:201336"]
If you were a member of the American Economic Association, you would consider whether the loss of employment in some businesses/sectors was offset by gains in the economy from the minimum wage workers spending their additional dollars, and whether those additional dollars had any significant inflationary effect if the minimum wage had not kept pace with inflation, whether the increased wage had any effect on worker productivity, and then you might do a statistical analysis based on the many states that have raised the minimum wage over the years to determine its actual effect throughout the economy, rather than relying on anecdotal information from a single business.

But that's not really the point. The point is that you can't call someone unacceptably ignorant if 25% of the experts agree.

[/quote]

In other words, just because RWMorris doesn't have the money in his check book to make the payroll, doesn't excuse him from paying money he doesn't have.

He should do a statistical analysis and then go and pay the money anyway.

Reminds me of how an engineer and an economist fell into a deep well and after the brushed themselves off, the engineer proposed digging hand holds and working their way up. The economist said he had an easier way: "Assume a ladder".

Unemployment rate by month for the past 14 years:

miseryindex.us/urbymonth.asp?StartYear=1996-01&EndYear=2008-12&submit1=Create+Report

These are U3 stats.

I think the survey really points out the obvious…especially when consider who is in charge of our government now. Nobody disagrees that the debt is at a dangerous level, yet the answer to that problem is to spend more. The left attack Bush relentlessly for his deficit, and when they get in power they make his deficit look quite small.

Other ideas and/or laws supported by this administration are all drains on the economy. Obama touted the healthcare law as a way to “bend the cost curve” since we can’t afford the massive cost increases. Now it seems every week a new report comes out stating the initial Obama cost estimates were too low, and that the law will cost the American taxpayer a lot more.

Keep an eye on other economic bombs to come thru congress like cap and trade, and the card check bill.

When you need the economy to grow, you don’t need a president in office who looks at private business as the enemy.

[quote="JusDaFacts, post:10, topic:201336"]
Seriously? How about this question:

I would have zero idea how to answer that question because I don't know what it means. Is it confined to workers directly contracting with American companies? Or workers working for subcontractors (as if more often the case)? Since when does the word "exploited" have an accepted economic definition? Does exploited mean that they have experienced no increase in living standards, or that their wages are still pretty miserable by American standards, or does it mean they are breathing harmful chemicals? Is it asking whether a majority of third world workers are exploited, or just a significant number?

[/quote]

My apologies for the confusion. I meant the last three questions, which, in order provided is 6-8, but, as numbered in the article, I should have said 5-7. The first question wasn't numbered...it's not laid out well in the article. That is one of the three that I was referring to. The other two were:

6) Free trade leads to unemployment (unenlightened answer: agree).
7) Minimum wage laws raise unemployment (unenlightened answer: disagree).

I would suspect the conservatives would be more likely to get #7 wrong, since they generally oppose minimum wage. Zogby must have messed that one up when he engineered it to get conservative results. ;)

For #6, I would expect a split among both conservatives and progressives - centrists are generally the free traders.

It doesn't change my point - 3 out of 8 doesn't explain progressives/liberals getting over 5 wrong.

I do have a problem with the way some of the questions are worded and some of them have no obvious answer. For example, the minimum wage question is a classic example. The answer depends on whether or not the minimum wage is above or below the equilibrium wage.

The other thing I find interesting is the question about housing regulation and cost of housing. While it is true that there is considerable evidence that regulation has some effect on housing prices, in practice conservative communities often have very strict housing regulations. In my conservative town we have a three acre minimum lot size which definitely increases the cost of housing. However, on my three acre lot, I could easily rent out space for four trailers so that lower income families could have a place to live. They could have access to our good schools, I would make money, everyone would be better off. Now the question is: would my conservative neighbors applaud my commitment to capitalism and the free market or would they run to the town and attempt to put government regulation on my back? If the answer is the latter, then are they only for regulation when it suits them?

[quote="stinkcat_14, post:19, topic:201336"]
I do have a problem with the way some of the questions are worded and some of them have no obvious answer. For example, the minimum wage question is a classic example. The answer depends on whether or not the minimum wage is above or below the equilibrium wage.

The other thing I find interesting is the question about housing regulation and cost of housing. While it is true that there is considerable evidence that regulation has some effect on housing prices, in practice conservative communities often have very strict housing regulations. In my conservative town we have a three acre minimum lot size which definitely increases the cost of housing. However, on my three acre lot, I could easily rent out space for four trailers so that lower income families could have a place to live. They could have access to our good schools, I would make money, everyone would be better off. Now the question is: would my conservative neighbors applaud my commitment to capitalism and the free market or would they run to the town and attempt to put government regulation on my back? If the answer is the latter, then are they only for regulation when it suits them?

[/quote]

No one solely reasons abstractly on moral and economic issues especially when those topics may have a subjective impact on one's well-being. People tend not to unbiasedly support a conclusion solely relying on their capacity for abstract reasoning, carefully considering the evidence, and constructing internally consistent positions, but people then to first support a position that conforms with their self-interest and then support it with arguments. That is why hypocrisy is omnipresent in human nature.

I suppose the regulations are in place to keep "social undesirable" lower class people out of the neighborhood; which are not firmly based on some notion of "econimonic efficiency" or the "common welfare".

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