Is this why it is all failing?

kleefarr · 09-12-2011 08:10PM #1

Recently received via email and in my opinion, lays in all down on the table..

An economics professor at a local college made a statement that he had never failed a single student before, but had recently failed an entire class. That class had insisted that Obama's socialism worked and that no one would be poor and no one would be rich, a great equalizer.

The professor then said, "OK, we will have an experiment in this class on Obama's plan". All grades will be averaged and everyone will receive the same grade so no one will fail and no one will receive an A.... (substituting grades for dollars - something closer to home and more readily understood by all)..

After the first test, the grades were averaged and everyone got a B. The students who studied hard were upset and the students who studied little were happy. As the second test rolled around, the students who studied little had studied even less and the ones who studied hard decided they wanted a free ride too so they studied little.

The second test average was a D! No one was happy.

When the 3rd test rolled around, the average was an F.

As the tests proceeded, the scores never increased as bickering, blame and name-calling all resulted in hard feelings and no one would study for the benefit of anyone else.

To their great surprise, ALL FAILED and the professor told them that socialism would also ultimately fail because when the reward is great, the effort to succeed is great, but when government takes all the reward away, no one will try or want to succeed.
It could not be any simpler than that. (Please pass this on)

Remember, there IS a test coming up. The 2012 elections.

These are possibly the 5 best sentences you'll ever read and all applicable to this experiment:

1. You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity.

2. What one person receives without working for, another person must work for without receiving.

3. The government cannot give to anybody anything that the government does not first take from somebody else.

4. You cannot multiply wealth by dividing it!

5. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that is the beginning of the end of any nation.

oscarBravo · 09-12-2011 08:22PM

kleefarr wrote: »

The professor then said, "OK, we will have an experiment in this class on Obama's plan". All grades will be averaged and everyone will receive the same grade so no one will fail and no one will receive an A.... (substituting grades for dollars - something closer to home and more readily understood by all)..

/raises hand

I have a question.

What exactly is "Obama's plan" to average dollars so that everybody receives the same amount? Because in the absence of such a plan (which I haven't heard about) your parable is meaningless.

kleefarr · 09-12-2011 08:41PM

The only plan I can find is from 2008..

http://obama.3cdn.net/8335008b3be0e6391e_foi8mve29.pdf

Taking that into account, it would appear that the first steps of equalisation and socialism have already started. In general it appears that people and businesses are being bailed out by governments more than ever before. In the past people were left to struggle and find their own way.
As pointed out in the email I posted, this may, and probably will, lead to to point 5.

Is it time for the governments of the world to get tougher?

oscarBravo · 10-12-2011 12:58AM

kleefarr wrote: »

The only plan I can find is from 2008..

http://obama.3cdn.net/8335008b3be0e6391e_foi8mve29.pdf

Taking that into account, it would appear that the first steps of equalisation and socialism have already started.

Hmm.

In a similar vein, I could claim that the various laws that make it illegal to treat animals cruelly are the first steps towards animalocracy, where animals have greater rights than humans.

Seriously: is this the best you can do?

RichieC · 10-12-2011 01:23AM

here's a rewrite from dailykos.

On the first day of the semester, an economics professor walked into a lecture hall filled with a hundred students.

"Welcome to Economics 101. Over the course of the semester, I except regular class attendance from all of you." The professor pointed to one student and said, "In addition to attending class, you will have unlimited access to ask me questions, discuss concepts, and fill in any gaps from class time."

Selecting another four students, the professor continued. "The four of you will meet with me once a week for a study session over lunch. We will discuss any questions you may have, any recent economic current events, or anything else you feel was not covered in class. You will also each be able to email me once a week with questions."

The professor looked around the hall before pointing to ten different students. "The ten of you will have the option of meeting with me during office hours for an hour after each class."

Not missing a beat, the professor selected another five students. "The five of you will have the option of meeting with me outside of class twice during the semester for ten minutes total."

The professor paused for a moment. "As for the eighty students remaining, you will not be allowed to meet with me outside of class or ask questions during class. At the end of the semester, all one hundred of you will be given the same exam. Your grade on that exam will determine your grade in this class."

Several students raised their hands. A handful said that it wasn't fair and went against university policy. Most stared at the professor in shock. The professor chuckled. "Calm down. Now, this is an economics class. And in order to study economics, you need to understand the power implicit within our economic system. You see, the breakdown just given reflects the distribution of wealth in the United States. For most of us, such statistics translate very little into our daily life. We know some people are rich and some people are poor. And within a capitalist system, we recognize that rewarding success and initiative helps society as a whole. The question is, at what point does such a distribution limit success?"

The lecture hall was quiet again, and most of the hands were no longer raised.

"I'm not going to hold this class to the rules given. All of you will have equal access to me during class, office hours, and over email. At the end of the semester, all of you will take the exam, and all of you will receive a grade based off your performance during that exam. But throughout this semester, I want you to think about how your semester would be different if we had used the breakdown I gave. Would you have done better or worse? And how do we find the balance between rewarding success and giving everyone the tools to have a fair shot at success? I know most of you think you know the answer, but let me caution you right now: it's never as simple as it seems or as black and white as we want it to be."

kleefarr · 10-12-2011 04:23PM

From you quote..

"The question is, at what point does such a distribution limit success?"

That point would be as in point 5 of my original post would it not?

5. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that is the beginning of the end of any nation.

feicim · 13-12-2011 02:00PM

kleefarr wrote: »

From you quote..

"The question is, at what point does such a distribution limit success?"

That point would be as in point 5 of my original post would it not?

5. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that is the beginning of the end of any nation.

Eh.. explain then how in Ireland there are people who work - and it is often pointed out on boards.ie that they would be financially better off on the dole - yet choose to work?

Of the many assumptions being made here, you are presuming that people only work for money... people work for all sorts of other reasons.

This is very simplistic to say the least.

laoch na mona · 20-12-2011 09:42PM

socialism wont work because of human nature
but Obama wasn't creating a socialist state he was just taking some of the positive policies of socialist thinking like basic welfare

RichieC · 20-12-2011 10:18PM

the relaxation of labour laws in the US and the decline in labour unions power is why the sky is falling. peole work harder and longer in less secure jobs for less wages.

the correlation between strong worker rights and prosperity is clear. they managed to hide this because although folks were getting less secure jobs and less wages, they were keeping their way of life by getting into credit card debt. an obviously unsustainable model.

SupaNova · 21-12-2011 08:53AM

RichieC wrote: »

here's a rewrite from dailykos.

The re-write is not a good representation of a capitalist system. To have access to better education(or more of the professors time) you typically have to pay more from money you or your parents previously earned. You earn money by providing value for others. Those who provide more value to others gain the ability to purchase education of higher value. The distribution of wealth in a capitalist system is not arbitrary or decided by a single individual like the example.

EDIT: Fwiw the first analogy is also poor or just wrong, but without being pedantic the 5 points made at the end of the email are correct.

amacachi · 21-12-2011 08:55AM

So eh Obama's a Socialist now? Cool. Cool cool cool.

theg81der · 21-12-2011 09:37AM

This thread is so interesting I`m really enjoyimg reading but I was thinking : In either illustration the student who got cancer/diabetes/heart disease etc or the student who suffered the loss of a close family member or the student who through financial problems has to take on a part time job limiting their study time or the student who gets raped and pregnant are not taken into account. These are factors completely beyond their control and if I was in a stronger position I would like to, and feel that in a civilised and educated society should be required to, contribute towards a fairer more equal society.

RichieC · 21-12-2011 04:51PM

amacachi wrote: »

So eh Obama's a Socialist now? Cool. Cool cool cool.

Depends who you ask I suppose. I would call him a center right moderate and a crushing disapointment.

cavedave · 27-12-2011 05:08PM

kleefarr

2. What one person receives without working for, another person must work for without receiving.

If I rub sticks together and make a fire I have worked and receive heat. If you then light a stick off my fire you receive heat. I still have my fire. I have not worked without receiving.

Technological progress makes everyone wealthier without stealing from anyone.

AngryHippie · 28-12-2011 02:02AM

http://www.chomsky.info/interviews/199811--.htm
from Chomsky:
What was different about the recent period of decline was that you had an almost classic failure of financial markets, a huge flow of capital, huge borrowing, private borrowing, private lending, and an extraordinary flow of herd-like behavior, and then pulling it all out in another irrational, herd-like action. And this is very familiar. Keynes warned about it 60 years ago, when he argued that finance ought to be closely regulated and controlled

nothing less than the democratic experiment in self governance was endangerd by the threat of global financial forces (Keynes)

If its been known for 60 years that removing controls increases vulnerability, and creating a global market leads to increased "herd-like behaviour" then the minds behind the powers that be must deliberately be aiming to effectively end democratic systems.
Having said all that, I think myself that a two party system is democratic in principle only, and what exists in the US and most modern democracies is a very contaminated and corrupt form of the concept, while on the other hand, democracies that are more pure tend to be less effective in executing government..
Maybe it is time for a change, a step forwards, away from the fascist, communist, or autocratic alternatives..
unfortunately I don't have the answer to that one

Jonny7 · 28-12-2011 02:15PM

kleefarr wrote: »

These are possibly the 5 best sentences you'll ever read and all applicable to this experiment:

1. You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity.

Tax the middle class

2. What one person receives without working for, another person must work for without receiving.

Shared technology and one industry indirectly supporting many others

3. The government cannot give to anybody anything that the government does not first take from somebody else.

Advice, planning, legislation, policy

4. You cannot multiply wealth by dividing it!

Economics : the multiplier effect

5. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that is the beginning of the end of any nation.

Which is why that remains hypothetical and has never existed

/my work here is done

Liam Byrne · 29-12-2011 12:10PM

cavedave wrote: »

If I rub sticks together and make a fire I have worked and receive heat. If you then light a stick off my fire you receive heat. I still have my fire. I have not worked without receiving.

Technological progress makes everyone wealthier without stealing from anyone.

Where did the second person receive the stick from ?

cavedave · 29-12-2011 02:04PM

Liam Byrne

Where did the second person receive the stick from ?

The ground. You can see its covered in them once you can tell the wood from the trees

johnnyskeleton · 02-01-2012 04:24PM

Haven't they carried out empirical studies on game theory / the prisoners dillema and found that, contrary to the expected result that everyone looks out for their own self interest, most people instinctively act in thr manner which is mutually beneficial? The results were criticised by the proponents of game theory etc as not reflecting real life situations. But essentially, while these anecdotes have an important message, they are only an illustration and should not be held out as axiomatic.

If you think about it, have you ever worked as part of a group or team in an assignment or task? I so, have you found that the members of that group performed better or worse than when on their own. Generally speakng, people will work together and work towards the best overall result for the group. So in the above example an equally plausible result is that the whole class cooperated and got a B grade and all were content with that result.

Lockstep · 03-01-2012 10:12PM

This analogy has been knocking around for years.

BOHtox · 04-01-2012 05:08PM

Jonny7 wrote: »

Economics : the multiplier effect

Exactly, not the diviser effect

SupaNova · 05-01-2012 02:01AM

Jonny7 wrote: »

Economics : the multiplier effect

Yes those wonderful equations based on shakey assumptions, using the flawed GDP as a measure.

Sand · 06-01-2012 09:09PM

johnnyskeleton wrote: »

Haven't they carried out empirical studies on game theory / the prisoners dillema and found that, contrary to the expected result that everyone looks out for their own self interest, most people instinctively act in thr manner which is mutually beneficial? The results were criticised by the proponents of game theory etc as not reflecting real life situations. But essentially, while these anecdotes have an important message, they are only an illustration and should not be held out as axiomatic.

If you think about it, have you ever worked as part of a group or team in an assignment or task? I so, have you found that the members of that group performed better or worse than when on their own. Generally speakng, people will work together and work towards the best overall result for the group. So in the above example an equally plausible result is that the whole class cooperated and got a B grade and all were content with that result.

I dunno about that - Strong individuals, working together can deliver better results than if they were working independantly. However, weak performers do not suddenly become magically more competent when teamed up with stronger performers. If anything they tend to lead to delay, rework and more effort on the part of the stronger team members who have to do additional work to cover their weaker team members - a strong team member doesnt just have to do his own work, he has to also has to check and redo the work of his weaker team mate.

Eventually this leads to declining morale and performance on the part of the stronger team members. The way to get results is accountability - individual accountability. I see and deal with this on a daily basis.

The OPs analogy is deeply flawed as well for what its worth - especially the simplistic lessons.

RichieC · 21-01-2012 09:36PM

RichieC wrote: »

the relaxation of labour laws in the US and the decline in labour unions power is why the sky is falling. peole work harder and longer in less secure jobs for less wages.

the correlation between strong worker rights and prosperity is clear. they managed to hide this because although folks were getting less secure jobs and less wages, they were keeping their way of life by getting into credit card debt. an obviously unsustainable model.

Suryavarman · 21-01-2012 09:49PM

RichieC wrote: »

The heading of the graph states "as union membership decreases, middle class income shrinks" the graph then displays a different set of data. Why did you bother posting something of such a low quality?

RichieC · 22-01-2012 01:20AM

Do yo want to argue the point I'm making or point out semantic flaws in the graph I provided?

Suryavarman · 22-01-2012 07:24PM

RichieC wrote: »

Do yo want to argue the point I'm making or point out semantic flaws in the graph I provided?

All of those graphs indicate that US median income has been consistently increasing. Obviously it has fallen in recent years but the general trend is for increasing wages even as union membership decreases.

johnnyskeleton · 22-01-2012 10:48PM

Sand wrote: »

I dunno about that - Strong individuals, working together can deliver better results than if they were working independantly. However, weak performers do not suddenly become magically more competent when teamed up with stronger performers. If anything they tend to lead to delay, rework and more effort on the part of the stronger team members who have to do additional work to cover their weaker team members - a strong team member doesnt just have to do his own work, he has to also has to check and redo the work of his weaker team mate.

Eventually this leads to declining morale and performance on the part of the stronger team members. The way to get results is accountability - individual accountability. I see and deal with this on a daily basis.

The OPs analogy is deeply flawed as well for what its worth - especially the simplistic lessons.

There's nothing magic to it. Working together does create accountability. It is often assumed that an individual will work his hardest when he is on his own and obtains all the benefits of his labour for himself. While that may often be the case, humans have a tendency towards working together. Thus, many of the empirical tests of game theory have shown that, contrary to the anticipated result, people often act not in self interest but in the interests of the group.

So while you say that being part of the group leads to declining morale and performance, this is not axiomatically so. Sometimes it can be the result if the stronger performers feel they are carrying too much weight or that the weaker members are exploiting them. Equally, however, the weaker members may up their game because while they do not find sufficient motivation in their own grades, they do get motivated by the potential loss of esteem in the eyes of their peers.

I think a better one of these analogies is the men in the pub / tax rebate one because that shows the effect of marginal unfairness of too much group equalisation rather than the perception of an absolute rule.

Which is why our current system of a moderate level of government imposed wealth redistribution is the prevailing system. It is generally popular and, while there are undoubtedly some fine tuning issues to be resolved (I think, and many would agree, that there is currently too much tax/welfare redistrubtion at present, leading to a popular belief that you are better off not working than working), overall it is a system which the majority of people are happy with. Consequently, we can deduce that the preferred option would be for a significant part of the grading to be done on group work but with the majority being individual work.

snow scorpion · 30-01-2012 02:28AM

kleefarr wrote: »

These are possibly the 5 best sentences you'll ever read and all applicable to this experiment:

1. You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity.

2. What one person receives without working for, another person must work for without receiving.

3. The government cannot give to anybody anything that the government does not first take from somebody else.

4. You cannot multiply wealth by dividing it!

5. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that is the beginning of the end of any nation.

6. There will always be politician who promise, "Vote for me and I'll give you something for nothing."

7. There will always be votes stupid enough to believe it.

8. Both of the above groups exist in numbers large enough to scare anyone with an ounce of common sense.

Yahew · 07-02-2012 10:53PM

Suryavarman wrote: »

All of those graphs indicate that US median income has been consistently increasing. Obviously it has fallen in recent years but the general trend is for increasing wages even as union membership decreases.

I thought the person posting these graphs was trying to show the clear and obvious reduction in the rate of income growth. The original graph you are responding to makes the starker point, and the more pertinent one. The share of wealth earned by the middle income groups has declined relative to GDP ( in other words GDP per capita has increased more rapidly than gross wages).

Suryavarman · 08-02-2012 08:48PM

Yahew wrote: »

I thought the person posting these graphs was trying to show the clear and obvious reduction in the rate of income growth.

I'm sure RichieC was claiming that income was shrinking for wage earners.

The original graph you are responding to makes the starker point, and the more pertinent one. The share of wealth earned by the middle income groups has declined relative to GDP ( in other words GDP per capita has increased more rapidly than gross wages).

It has to be taken into account that household size has also been shrinking which would cause household income to shrink even though individual income might be the same. This could be because of retirees living in their own house instead of living with children and numerous other factors.

Is this why it is all failing?

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