Debunking Trickle Down Economics
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- Опубликовано: 5 окт 2024
- The core philosophy of the governments disastrous mini-budget is "Trickle Down Economics". Gary explains why it simply DOESN'T work.
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Homer Simpson has used this same strategy in S:15 Ep:7 he buys his own expense present and says his happiness will trickle down and everyone will benefit.
Homer's logic sounds more believable :)
Old Simpsons is peppered with little maths and physics tidbits.
New Simpsons and especially Futurama still have math and philosophy sprinkled in etc it’s just not as big in the culture, so not as many ppl combing through it to catch each reference
@@interloc1290 Futurama is imo one of the best programmes ever to be made and I mean that!
Rick and Morty were totally inspired from it, well that's what I think.
The Simpsons, well the older ones were very sharp witted back in the day. I think it's a little tamer now but I will always watch it.
Family Guy and American Day wouldn't be a thing if not for the Simpsons.
For philosophy, "The Good Place" will never be surpassed...
@@interloc1290
killed it on the novara interview there. always a great guest but seeing you go off got me curious about following this channel.
worked for royal mail from i was 16 for 15 years before getting into game development. its crazy how different money is when you work with people from a completely different social strata
Gary, I saw you from Novara Media and I'm convinced that you can be one of the key voices for change in the current economic system. Until now I've only been listening to Yanis Varoufakis, Mark Blythe, and Adam Tooze on why the economy is broken but you bring a totally fresh perspective and deliver it in a very relatable way.
Keep getting your voice out there and you'll work out how youtube works in no time. One thing you could do is to try and collaborate with some other economics creators here on youtube. I'm sure many more people are going to be interested in your perspective.
Stephen, He's misleading, Despite what they say, they know the truth, Inflation is from one place and one place only, it is from "government" working with central Banks to Print money and distribute this cash (mainly on bailing out Banks) through so-called quantitative easing, the present Government spending schemes will cause more Inflation (the curse of cheap money) Whats been mainly driving house Prices up was low interest Rates and a tsunami of readily available stream of cash. Government Ministers mostly think that "Inflation is something related to Bicycle Tires" They drive us around the bend (on rubber flat tires) giving out misleading and deceptive statements
@@chrislambert9435 Isn't what you're saying consistent with what he's saying though? Did you watch the video? Essentially he's saying the way to stop this process is to direct the flow of money into investments and enterprises that create actual economic value which can only be possible by increasing taxation on the wealthy class.
@@chrislambert9435 you didn't say what he said was misleading? You went on a ramble about something else
@@phchmogh His presentation on "Inflation" was misleading
@@chrislambert9435 it was about trickle down economics, hence the title
Heard you on the New Statesman podcast, great job explaining the current dynamics at play and it led me to your YT channel... I think there's another subtle factor at play in the persistence of inequality: it is simply that only richer people have the luxury of sufficient quality TIME to improve their lot in life. Even just reading, writing and getting your ideas straight in your own head takes time. Time never "trickles down" - in fact many Tories even think the poor are just lazy...
Those living in poverty don't have the mental space - and more importantly the mental health - to just think, to be creative, to learn new skills, and do all the things that economic theory expects of rational 'actors'. We need to invest in people, and create the environment and conditions for human flourishing, if we want to see people break out of their poverty traps. Many people juggle several jobs, perhaps combined with parenting or caring (my wife and I cared for her father with advanced Parkinson's disease for 5 years until he sadly passed away a couple of months ago, so I know this from personal experience). Time is hugely under-rated, and politicians never talk about it because they take their life experiences for granted.
OMG! I've been thinking about this for such a long time. Time never trickles down, spot on!
It may be that in the homes of the rich, the TV (the idiot's lantern) is not always on, robbing them of reading time, etc? I know min's on a lot... @@luisablandonmos
Politicians only talk about what their sponsors want them to talk
Hi Gary! You were great on Novara Media on Friday! ⭐⭐⭐⭐⭐
I will correct you on one thing: we don't have a "new government", only a different PM: that government has been in power for over 12 years wreaking its damage on the economy and the British people with never-ending austerity and public services cuts. I also suspect that the government already knows what you're saying - that trickle-down economics doesn't work - but hopes the public don't find out. Instead, they try to sell the notion of this trickle-down policy to ordinary people to make them believe it's a sensible one that benefits the public, when in reality it is there as a justification to give ever more money to the rich. You see, people need to understand the raison d'être of the Conservative Party: it is to represent the super rich and to do their bidding even at the expense of the public.
Skylar, correct him on this also; Its not "giving" cash to rich people, its letting them have the Money they have already earned and therefore own. Plus, all the Shortages & Price Hikes and caused by "Government" this can especially be seen in Housing
Again Skylar, I tell you, Despite what they say, they know the truth, Inflation is from one place and one place only, it is from "government" working with central Banks to Print money and distribute this cash (mainly on bailing out Banks) through so-called quantitative easing, the present Government spending schemes will cause more Inflation (the curse of cheap money) Whats been mainly driving house Prices up was low interest Rates and a tsunami of readily available stream of cash. Government Ministers mostly think that "Inflation is something related to Bicycle Tires" They drive us around the bend (on rubber flat tires) giving out misleading and deceptive statements
There has been a progression to where we are since the 70's. Blair didnt change much, and actually speeded up Privatisation and PPP's. You could argue that Blair abandoiing the working class in order to court the middle classes laid the groundwork for the Leave campaign.
If people out there that still do not understand what the Tories are all about they should not be allowed the vote. Obviously in England where millions of people are going around with their heads lodged tightly up their own arses!
@@chrislambert9435 I'm curious what do you mean by "earned"?
Hi Gary, the bit you kind of miss to enunciate is that it is in their interest to invest in existing assets, investing in existing assets increases their value, especially if there is competition for those assets.
As they will typically have existing assets paying over the odds for an additional existing asset will increase the value of their existing assets.
Investing in new assets, unless it is a massive growth area, new technology, new market etc, then they won't as it is not in their interest as this will devalue their existing assets.
He stands there like a normal guy with his cuppa and T-shirt, not with a sharp suit and a fancy tie, and expounds so much intelligence and knowledge. Love him!
It’s all part of the act, but he does have interesting things to say, even though they’ll never come to pass.
Surprised he isn't wearing a Marx t shirt
He needs to get a new economics degree at a different university
@@maxrequisite assuming you know far more about this sort of thing than he does of course.
@@juliewake4585 I know that what he has said isn't backed up by any numbers and quite the contrary
Thank you, Gary. I have known for some time that "Trickle Down" is a confidence trick on the rest of us, but I could not have explained exactly why! Keep shedding light on the dismall science, please.
This guy is one most of the impressive young men I've ever seen intelligent and morally correct 💯👏👏👏👏
Why?
His whole premise is false. There is no trickle down economic theory.
Great exposition and critique of Trickle Down Economics Gary - Thankyou! All made simple and articulated with ease - that's what great teachers do!
That was the most interesting interview I’ve seen in ages, I went straight over to Gary’s Economics channel and subscribed - thank you.
Me too.
I saw him in Novara Media talking to Aaron Bastani: great interview.
Me too.
Absolutely fantastic! Thanks for your work Gary, everybody needs to hear your words.
Great video! Succinctly explains how trickle down economics just leads to asset price inflation, which leads to average person becoming relatively poorer. And how the investment they do make are often in non-productive assets that extract wealth from the people who don't own the assets which increases the relative wealth inequality further
Correct me if I'm wrong. So the 'growth' is the overall size of the pie/pizza getting bigger (e.g. from 9.5" to 13.5"), whereas Gary's point/concern here is that the recent trend is that the money the rich accumulated is largely used to buy up a higher proportion of the existing pizza while the size of the pizza itself remained unchanged therefore the non-rich get: 1) less physical resources amongst the population, 2) the same quantity now costs more because of smaller supply = inequality. So what we should be measuring the health of our economy against is whether the overall size of the pizza is getting bigger or not. I hope I got your point right, Gary.
It’s the member that gets bigger say from 2’ to 6’ when stimulated.
Gary’s economics is quite simple , more tax .
He’s a government shill , anyone calling for more tax works for the man .
Agree. This is exactly the point Gary is missing. The economy isn’t a zero sum game. By letting rich and poor people keep more of their money you will gain a larger economy which benefits everyone.
@@romankacin8365 Absolutely. Politics of envy benefits no one. Poor people are not poor because the rich aren’t paying enough tax . Government taxes/robs us blind , the sooner people realise government is not the solution, they are the problem . Inflation is created by government borrowing , which destroys the value of the money we earn .
@@romankacin8365 You're missing the point. Fundamentally it's about the allocation of resources. Just handing out money to those that already have a lot via bad government policy doesn't mean extra investment and economic growth. Why wouldn't those with "excess" money just buy up existing assets instead of creating new ones (e.g. investment in businesses, entrepreneurship, building houses). The buying up is simply much easier to do. Money is just the intermediary that we use to buy *real* things.
@@kevinkuhl2766 You are missing the important first step which is taking money from the population, and at the top tier of 45%, that’s a lot of taking. But I agree that afterwards comes the misallocations. Simply servicing the national debt costs the UK tax payer 45 billion a year, every year, out the window. That’s criminal.
Hello gary thankyou for doing these vids they have helped me to explain to friends and family what is happening in this country keep up the good work
Not even sure where I stumbled upon your channel but am sincerely glad I did; I did an Economics degree (albeit as a minor to my major in Linguistics) and I was dogshit at it, but I feel far more comfortable around something like this concept having heard what you put. Thank you for this.
killing it gazza . hope your momentum keeps growing . wealth inequality is really the most uphill of struggles , so an authentic voice of clarity from someone who has seen both sides is vital I would think . keep on preaching brother 🙏
This has always seemed pretty easy to grasp to me - which begs the question, what is the motivation for pushing trickle-down economics? Are the politicians who support this sort of policy willfully blind, is it simply in the interests of their immediate circle, is there an ideological element to it?
I have been working in the American working class since 1980 and I am still awaiting my trickle down...I am starting to think I may have been duped.
All of us that believed that propaganda at one time or another have been duped. Some working class have been duped so much that they actually campaign on behalf of the rich.
Yea, You were duped by the liberal media. With one sided misinformation, It’s a nonexistent theory that’s constantly being attacked, It’s a hack phase, who said something would trickle down? The people promoting supply side economics never said something was going to trickle down. But they did say the lower tax rates would pay for them selfs meaning no less revenue for the government. Reagan lower tax rates from 70% to 28% and the where able to double the revenue. The economy boomed. The whole thing is base of economic theory going back to the 14th century, was later named the laffer curve after art laffer an economic advisor under Reagan. The Laffor curve theory shows that there is a revenue maximizing point. supply side economics is actually been proven to work over four times. The political left blames deficits on tax cuts but the real problem is too much spending, the main driver on the debt is social programs.
You're criminally undersubbed good sir, this is unacceptable, loved your novara interview, you explained things in a way I could easily understand as someone with learning difficulties so thankyou
Thanks boss - get sharing then!
@@garyseconomics already did mate, take care 🙂
@@garyseconomics found your channel through the Novara clip, great analysis but seems you are missing concrete strategy for implementing tax reform
in the US, we have a new Forward Party movement to effect direct democratic change rather than trust "major" parties already bought out
the key is actually going to be a new form of massively scalable consensus software framework where millions of people could reach consensus on key topics in a matter of hours
seems Brits could use a bit of that as well?
Gary, I am an A level Economics teacher and I' ll be making your videos compulsory viewing for my students. Thank You.
Opened my eyes, i used to be pro trickledown, but yes, if the rich lack entrepreneurial spirit then it doesn’t work ! Thanks gary
No you won't, it isn't on the A level curriculum.
Well yes I did. And they-re better for it.@@entropy5431
@TylehurstXL and if they lack an entrepruenual spirit, another one who does takes their place from their failure when their business goes under
Bubble-up Economics works a treat every time! Returns growth really fast.
Gary I've only v recently found your channel and I'm currently in the process of watching everything you've put out. You speak more sense in the area of economics than I've ever heard, I admire the fact that instead of just thinking of yourself and enriching yourself you have sacrificed that path to educate society to the gathering storm of inequality that Govt policy seems to be creating. Can you answer something that is often used by the Govt as justification for such policies namely if the rich are taxed more rigorously then they will leave our jurisdiction and take with them their businesses thus stultifying economic growth leading to unemployment etc..I have my own views on this question but I'd be interested to hear your stand. Keep up the excellent work
Hi Ian, I'm glad you're enjoying the channel. There is a video on the channel answering your exact question I think it is called "can we tax the rich". Check it out!
Hi Gary, I just found your videos and I think you have alot of really interesting things to say.
I wanted to ask you a question - what do you think the impact of a debt strike would be? By that I mean a campaign simular to don't pay UK but with unsecured debt. Do you think that would be a big enough lever to demand change?
THanks to your brilliant Novara Media interveiw, I've now just subscribed to your channel. Great stuff, thanks.
Income derived from capital appreciation from asset accumulation. It's static wealth not flowing through the economy. Expenditure is minimal in terms of capital spread (how many benefit from a millionaire buying super yachts or hyper cars?).
Trickle UP (increasing personal/basic thresholds, plus moderate pay rises to minimise inflationary impacts) allows for broader-based expenditure on core goods and services, boosting GDP for maximal benefit.
My daughter has just started college Gary I have sent her some of your links because you explain financial ideology in easily understandable language. Good work!!
I have tried to explain to her but you gave me a refresher also as we enter/leave the bitcoin era (short era). When I listen to current Tory gov ideology my own eyes and ears have began to shut. Its desperate stuff again cheers for the simple explanations!
This video is pure theory and isn't backed by real statistical data. Wealth has gained for all classes over time and those who have the most government regulations and taxes have shown to have some of the slowest PPP growth. His talks of corporate owned homes is wrong as well. The UK corporate single family home ownership is way higher than the US where business don't habe to be constrained and feel the need to purchase physical assets for security like they do in the UK. Don't get me wrong, his arguments sounds logical and have a good base of reasoning, but it leaves out the actual reality of the situation rather than just "expectations".
Found you thanks to Novara; will definitely be following your channel from now on. Such easily accessible, common sense economic analysis is hard to come by
Thanks Robert!
Found you on Novara Media, welcome back to serving the people, the working class. You are doing an amazing job of waking the sheep up.
I'm Australian and just started watching Gary's channel.
if it wasn't for his accent I could easily describe that he was talking about Australia. I was in Canada for work a couple of years ago and he could be describing Canada just as easily.
I first heard about Trickle Down Economics back in the 1990s. I read a book called "Apocalypse 2000" where these guys were warning that by the year 2000 we'd be on the verge of economic collapse. One of their main reasons was Trickle Down economics. They were almost right it just took until 2008 for their prediction to come true.
Its so amazing that we keep having to have this discussion *AGAIN.*
Thanks for the videos mate, you are giving me some really good vocabulary to talk about this stuff with my parents and debate it. I also think that you coming from the investing world is going to give you a lot of strength when you advocate, its gonna help people's perceptions of you when you try to discuss theory of value etc. I think this is especially true when you go up against right-wing people because I feel like our national conversation is calibrated around their ruleset, and that needs to be questioned and changed if we are gonna make any progress.
I'd say maybe try and get a conversation with Owen Jones if you can manage it.
Cheers again and good luck with the channel, I have shared it in my friend's discord.
Very good explanation about why "Trickle Down Economics" doesn't work. However, for some reason these kinds of videos always fail to mention that nobody ever said that it does. I have yet to see a serious person in the public eye defending the notion of "Trickle Down Economics". In case anybody doesn't believe me, just try to find a defense of the "Trickle Down Economics" concept. You will find article after article, and video after video explaining why it DOESN'T work, but you won't find anything claiming that it DOES.
"But haven't economists and right wing politicians pushed for Trickle Down Economics for decades now?" No, not really. Not at all.
Academic economists don't consider "Trickle Down Economics" a serious economic theory. It is not taught at any university and you can't find it in any textbook. In fact, you will have a hard time to find any academic economist to even discuss the subject because nobody takes it seriously.
Politicians on the other hand are very often accused of being proponents of "Trickle Down Economics", but in reality they rarely are. The "Supply Side" economic policies of Reagen and Thatcher in the US and UK respectively, as well as the proposals of many contemporary right wing politicians are often perceived as being "Trickle Down Economics", but in contrast to popular believe, "Supply Side Economics" is not "Trickle Down Economics".
"Supply Side Economics" refers to economic policies that tries to make production easier, by incentivising business expansion, job creation and entrepreneurial activity, for example through tax cuts and deregulation. The flip side of this would be "Demand Side Economics", which refers to economic policies which try to increase demand, for example through government spending. Now it does not really matter which one you prefer or which one is "better", because both of those concepts are very vague and the answer is that it depends. The point I am trying to make is simply this: Nowhere in the description of "Supply Side Economics" does it say anything about "giving money to the rich so that it will trickle down to the poor". This would be ridiculous. And the reason for this is even given in this exact video: If you give money to the rich, they won't invest it in business, but will buy another yacht. It will not do anything to increase supply. This is ironic because not only is "Trickle Down Economics" not "Supply Side Economics", but the reason WHY "Trickle Down Economics" does not work is precisely BECAUSE it is not "Supply Side Economics".
So we find ourselves at a point where countless politicians, journalists, bloggers and podcasters are attacking a concept, which is not even a real economic theory and which has no proponents. "Trickle Down Economics" was never a serious proposal to beginn with. It was ALWAYS a derogatory term. So yes, it is true that "Trickle Down Economics doesn't work", but to point that out is also pointless because at best it adds a lot of unnecesarry confusion and at worst it is just a cheap strawman.
Nicely done, very clearly stated. The clarity is the strength of this channel. What comes across strongly also is the focus of rich people buying houses. This in part is driving inequality and a major part of the enthusiasm for property is that it is incentivised by our tax system. There is no capital gains tax on your home. So the issue that Gary raises is amplified by our tax rules.
Brilliant Gary. You speak so much sense
here after enjoyed your Novara interview. Appreciate you sharing your knowledge, have subbed.
Great explanation Gary. I was taught trickle down economics in the late 80's early 90's in high school, and I've known for some time now it's never worked. I thought it was because the rich just moved the money offshore, but your explanation makes much more sense.
There was an open day at my highschool a couple of years ago so me and the family went and it turned out the only teacher still there from my era 30 years ago was my economics teacher haha. Economics, maths and physics where the only subjects I was really good at in school, probably because of my dyslexia. And the economics teacher really made an impression on me. Sadly he wasn't there when I went to my old class, so I grabbed a post-it and wrote "trickle down economics was a lie" and wrote my name and stuck it too his desk. Hope it brought a smile to his face. 😀
Saw you on novara media, you did a great interview
fuck man, immediately onboard and sharing your vids.
Gary, you talk a lot about idiotocracy and how the wrong people end up in economist jobs and media jobs, I totally agree. It’s also evident that those very same people end up in positions of political power like MPs. Why would someone who is the best our society has to offer, go work as an MP instead of ‘working in the skyscrapers’?
I would absolutely love a shift in leadership from the out of touch politicians to real, smart people who have an idea of how the world works, helping all corners of society. While if anything this would be a sacrifice, if you have the opportunity to go into politics and help shake up the system, in my opinion it would be the most profound use of your activism. As an MP your voice would be heard much louder and you can have a direct impact on government policies.
Have you ever thought about doing it? I’m a maths PhD student at Oxford and I’m thinking I’d love to do the same. “If no one else wants to sort it, I’ll do it myself.” I’d trust you more than anyone else.
Hi Gary, a question. Will house prices fall this winter? If not, why not? If people coming off fixed mortgages, plus businesses closing down because of high energy prices, and the fact that most houses are still bought on mortgages, shouldn't that make the prices fall? Especially if interest rates remain high?
If you watch the interview with him on novara media he explains why they probably won't fall but will continue to increase. Basically with the rich getting richer they will buy more houses (often with cash so no mortgage) and this will keep prices high
Please keep informing us on the real economy. You're really putting us wise.
I would love to see a video on how you would adjust the tax structure to create a healthy environment for the general population.
Thanks for the video Gary. What I can see happening next is because people will not be able to afford to pay their mortgage they will be forced to try and sell. Because of the difficulty in getting an affordable mortgage there will be no first time buyer except for the wealthy, as you had made crystal clear. The government will be forced to enable people to stay in their homes even if they cannot pay for the mortgage, otherwise there will be families out on the street in even more horrendous numbers. I foresee that this situation could well be an opportunity for this government to make people pay more and longer for their mortgage, of course, again not a problem to the wealthy because they can pay, and sell some property as soon as they can if they decide to. Gary, how do you think the government will handle this home problem ? PS also , leaseholders, have added cladding issues and high maintenance charges they have no control over, they have these extra problems that make it impossible to sell their home/lease.
Saw you on a podcast and subbed to your channel. Because,
You look like the bloke who had a rough week, got smashed the night before and now you're talking to me, in front of our workplace, about to enter but we both hate our jobs. We smoke our ciggies and drink our coffees to muster up the tiniest bit of motivation.
Can't wait for more of your stuff mate.
Really good explanation. Thanks for the video.
Thanks
Great explanation. Really easy to understand and to the point.
Also your face definitely matches your voice.
Thankyou i will put that on my tinder
@@garyseconomics haha I'm feeling lucky for you buddy. Also I'm the cousin of Bob's mate and another mate and that mate got me onto your podcast with that other mate on Spotify. You're so to the point man. I'd never have got an E in Economics if I had your channel 28 years ago.
Rational thinking … wasted on the current government (deliberately I would say).
Brilliant again Gary. The thing is this has been known since, and probably before the 1920s. The official term is, I believe is supply side economics.
The term "trickle down economics" was coin by a satirist in the 1920s and was meant as a derogatory term that has become normalised.
The end result is The USA.
The country with the greatest wealth divide, no heath care, the lowest minimum wage in the western nations. And corporate welfare of billions is common place. So not only do the top 5% own the 95%of the assets the working classes get to have income taxs given directly to corporations that immediately do stock by backs inflating their wealth even more.
This is the post capitalistic world of oligarchs we can expect. And we still get told that when the rich piss on us it's raining gold.
Your video really helped, Liz saw your video and was like "shit, he's right", and stepped down. ;)
I love what you are doing, I know you don't need to do this at all and you are very wealthy but I appreciate your effort so much. I want kids but have already decided not to have them as I'm so worried about the dystopian future we seem to be headed toward and I couldn't bare the thought of seeing them suffer. People like you are the only people that can get the message across that this system we have has to change. please keep up the good work and maybe one day things will change.
Hi Gary. Love the content. You said something (I think w Aaron Bastani) about how the Tories were coming after middle class homeowners with mortgages, because they’ve squeezed all the wealth from the poor. Could you talk about this a bit more please. Particularly how the rich will access middle class property assets going forward, and how this relates to policy and rate rises etc. Thanks mate.
ruclips.net/video/AU8UTIVjZ0Y/видео.html It's discussed in this video J M
Great, as always!
Well explained.
From Novara media!. Working class needs more exposure to people like you to educate the majority then the decisions they make hopefully will one's that benefit the whole of society economic education is soooo important.
Hi Gary, love the videos, really enlightening! Would love to see a video that takes on how you would tax the rich if you were chancellor, is that possible sometime?
Gary ur awesome. Need to get you on more mainstream TV!
question: how do you rebutt someone who says "if you tax the rich more they'll just more abroad"? wouldn't know how to counter this if it was put my way.
Subscribed. Can't wait to see your channel grow. X
I agree Gary. If you remove human decisions from the equation it can work (I.e. company pays less tax, which leaves more money to invest in the infrastructure of the company and staff, which leads to growth), but sadly humans are greedy and they just use these scenarios to grow their own assets, which doesn’t really benefit anyone else.
Perhaps the tax breaks should come more from direct investment in new assets (including staff).
What people fail to grasp in terms of company taxation is that the investment is a pre-tax allowable expense which decreases profit, so there'd be less tax to pay. There may be an issue of how certain capital is investment is allowed as an expenses, it may be on a percentage basis over several years. But these do reduce tax. So it's not a valid argument to say that taxing reduces investment. Secondly, big companies organise their affairs to maximise profit and minimise tax. Ever heard of the "tax loss": which is a legitimate but pointless expense which reduces taxable profit. And companies form separate companies as a vehicle to separate their business, again to maximise profit. Energy is a prime example. If the mechanism is very complex, you can guarantee a scam is involved.
On paper, most economic and political philosophies look perfect. We can all name some of the main offenders, right? As soon as you introduce human nature, it all falls down. They may be made to work if we were all robots or drones- and the argument might be made that the system is attempting to turn us all into exactly that.
@@goodlookinouthomie1757 Definitely! Human corruption exists whether we are looking at Communism, Socialism or Capitalism. The real issue is human nature, not the system itself. At the end of the day that is the problem with economics. If pretty much any system is run fairly, where everyone has the same opportunity etc. then it can work. The issue is that (regardless of the system) there will always be those in a position of power within that system, who will want to retain that power and control. The powers that be just want the masses to go off to do their 9-5 jobs and be part of a system that they control and which enables them to retain that power and control. School is structured to create the food for that system and most things in society back that up.
just in from the novara interview, glad to have found your channel. 🙂
“Buy existing assets” is the vital phrase.
We don’t hear this from senior politicians or commentators is because they don’t have the class perspective.
Also growth means exponential growth which is the same as acceleration. It can’t go on for very long in a finite system.
Really good output. Saw you on an interview with Owen Jones and sounds like your economic content is logical and interesting. Subscriber +1
If giving money to the rich doesn’t lead to productive investment, which sounds like something we want and need, what does lead to productive investment? Does it have to be government i
Spending? I have heard “trickle down economics doesn’t work”, and your video made perfect sense to me, but I would love a follow-up on what would actually get us new wind farms and agricultural equipment.
It's definitely not the government, which is essentially an inefficient business that determines consumer needs arbitrarily 99 times out of a hundred.
Also, government owned homes in the UK US are astronomically high in comparison to the US, which leads to housing shortages as well as higher home prices relative to PPP.
Is it not also, practically impossible for a really rich individual, family or even company to just build and instigate a public transport project? Like those things always rely on some kind of government expenditure.
Gary do you ever call in to shows on LBC etc? I think James O’Brien would really enjoy talking to you and be blown away by these insights!
Trickle up into elite pockets.....
Good on you Gary 👍
After watching you on the Novara interview, my thoughts are Gary for Chancellor of the exchequer!
Debunking something that nobody claims exists, great job!
You overlook the critical issue when you argue that buying existing assets will simply drive up prices. When prices rise for any scarce resource, there's a significant supply-side response. The supply of houses isn't fixed; as prices increase, it becomes more lucrative for construction companies to build new homes. Consequently, they will expand their efforts to meet the heightened demand. If wealthy individuals bid up the prices of existing assets, it creates a stronger economic incentive for developers to produce more housing, thereby balancing the supply with the increased demand.
I like your videos, keep up the good work! I am from a poor background too and I went to study Economics to be able to understand our current society (as that was information my parent's unfortunately could not pass down) and now I completely avoid the news (it's basically propaganda) as I realized very quickly it's rich people in government and media making government policy for the rich.
Great vid 👌
Saw you on Novara and headed over
Hi Gary,
I would say that investing in new productive assets is a more profitable investment. For example there's more money to be made in buying a plot of land, building a house then selling it, vs buying an existing house and sitting on it till the price (hopefully) goes up.
Therefore, what do the rich see in these sort of passive investments, vs investing in the more active, productive, new-build style investments?
If I had lots to invest I'd always be looking for a do-er up-er, an upcycle project, or to develop a new product.
Been glued to your channel for the past wee or so now having just discovered you, and looking forward to the next.
The easy way to come to a conclusion about trickle down economics against bubble up economics is look at examples around the world. If you look at Brazil for instance compared to any Nordic country you see where it gets you.
Trickle down economics. Aka.
Pissing up someone's back, and telling them it's raining.
If renters need to rent houses and there’s more supply of those houses to rent as they’re being bought up then that will slow down the rent increases relative to house prices which will at least help renters. If mortgage rates rise that’s not going to help renters though as the landlords will put their rates up. If landlords are pushed out of the market as it’s no longer profitable to be a landlord there will be a housing crisis, rents will go up as supply has lowered and house prices should come down as those houses are being sold (not sure on that) So you can’t win. Best to build more housing to increase supply and have incentives to ensure more of those new houses are bought by owner occupiers which will start those families gaining wealth by at least owning their own home as it rises in value.
More incentives are required to encourage the rich to invest in things that aren’t housing such as wind farms and factories instead of buying up property. If these commercial ventures are more profitable they will have more money to pay workers but only if incentivised or forced to do so. Let’s be honest if they don’t have to pay people more they won’t as it’s more money for them. Property investing is a well known and established way to make money and increase wealth as land and property are finite plus borrowing against it enables you to erode your own debt just like the government does with inflation.
As is common with Gary’s message redistribution of wealth is required it’s just a question of how. Trickle down economics will only work if you incentivise the path the investment will take. Those with money will choose the easiest and most established path to increase their own wealth every time and one of those is property.
Economics to someone like me who is not trained feels like a large ship. You have to slowly steer it in the right direction you don’t want to shock it with a big wave otherwise it’ll sink. Just turn it the right way and make those small course corrections and eventually the problem will be resolved. The issue is governments are in power for a maximum of 5 years which is still relatively short when compared to how long an economic policy should be in place. As a result their policies can be short term pleasers. That’s what I think is happening right now. An economic wealth distributing policy is unlikely to stay in place for the amount of time required for it to make a difference. Hopefully someone will do something about it one day. But whilst those with an incentive to keep things as they are are in power things will stay the same.
Like many others I'm new to your content thanks to Novara. Insightful stuff. You're a voice mate keep up the excellent work.
Great job
Hi came over from Nora saw you there. Subbed
Where on earth did you pop out from ? Great critical thinking, logic and cohesive arguments. Have considered standing as an independent?
So, Trickle Down Economics is behaviourally and economically naive, because the dominance of financialisation - the growth in private assets vs public assets because of privatisation - means tbe wealthy will just hoover up more low risk assets - like stocks and shares or houses - instead of higher risk assets such as investments in industry. And that increases costs for ordinary consumers, and deprives them of the basics low risk assets they need for survival. Combine that with policies that myopically focus on preventing wage spiral inflation, Trickle Down Economics 1) effectively kills the goose that lays the Golden Egg - the purchasing power of wage earners - that drives economic growth; 2) disincentivises both the wealthy and corporations from investing in their businesses, or innovation to increase productivity, thereby encouraging chronic low productivity, relative to other countries; 3) Divests the State of the ability to intervene and i) maintain the infrastructure needed for economic growth, such as education and healthcare; and ii) neuters their ability to use tax policies to incentivise investment in higher risk assets needed to grow the economy.
So this is impoverishing middle class and working class consumers to benefit the already wealthy.
Welcome to the New Precarity, in the chase to the bottom. If consumers can't buy, there will be no real growth. And reducing their wages is killing off their ability to buy consumer goods, either outright, or on credit, which accounts for the fall off in consumer spending, and the closures of businesses dependent on consumer spending. Trickle Down Economics is the Agent Orange of real economic growth, because it kills off the bulk of consumer spending in the long run. It's a form of economic colonisation, that will enslave and impoverish the people who have no wealth.
Gary, now I'm not judging but I have a question. I first saw you on novara media and I like what you say. Apparently you made your first million at age 23. What do you do to invest even a small part of that money in growth?
One thing that is not clear is; how are “rich people given money”? Over covid I don’t remember any “rich people” given money. Some money was given to small businesses but it wasn’t even enough to keep them going. And also, what is your definition of “rich people”?
Or are you talking about rich corporations?
ruclips.net/video/EiblHqbpXHs/видео.html
Gary I would love it if you can make a series of vids explaining how to trade tge market the way you do
Hi @GarysEconomics , I really love the videos and I have a question if you could answer it. I understand why trickle-down doesn't work, but you seem to suggest (as in the Novara interview) that the better option is to give money to the working class instead. If investment in creating new assets is the way to long-term growth, then why not tax and spend on these as a government, rather than giving the money to the working class? I had understood that the short-term, consumption-driven growth that giving money to the working class would produce would just cause demand-pull inflation and not necessarily solve wealth inequalities, whereas the long-term, investment-driven growth that government projects would produce would lower cost-push inflation and lessen wealth inequalities. If that is true (please tell me if that's wrong) why do you prefer giving money to the working class?
Keep your hands away from face...use the cup, if you're going to hold it ...good topic, well explained.
No one is stupid enough to invest when the buying power goes down. You do not make money from investing, if the business you are investing in can't sell what they produce. And if everyone have less money, they buy less. That about sum up, just how dumb the whole "trickle down"- idea is
I saw you on novara Gary brilliant
Economy doesn't trickle down, it bubbles up.
I feel like I'm on the end of one of those conversations in a randoms kitchen at 2am
I've only just discovered Gary after the recent, now infamous Politics Live appearance. Really interested in this stuff, so don't know how I've missed his stuff until now! Anyway, fantastic insights into this World and loving what he is saying about inequality and the causes. Spot on. We need more people like this. People that know what they are talking about because they are from the kind of environments Gary has worked in. But also that are honest about how all this shit works.
Rich people are likely to employ the services of the self employed. That is, they'll hire gardeners, window cleaners, eat out, hire nannies, send their kids to public schools, buy private health care etc. My struggling CEO boss told me how when he lost his 100K position at his last employer, he sent his kids to state school, cancelled window cleaning contracts, did the gardening himself etc. Societies need people who want to get rich without feeling they're being exploited by the less talented, lazy and feckless trying to tax them more than everyone else.
I live on an estate where half the houses are council owned: and there's far less crime and anti-social behaviour as the richer middle-class moved in, compared to twenty years ago. The less talented have moved elsewhere, taking their non-educated, alcohol fuelled behaviour with them.
I love this channel and your content
Hi Gary, you ever followed Michael Hudson's work?
excellent Gary - thanks
I'm a cleaner. I mostly clean the 2nd homes of the rich in my area, often they go weeks with no occupancy and they leave the heating on at 21 degrees! No energy crisis, we have distribution problems....
Thanks, thats good information!
Hi Gary, new subscriber from Novara. Great content. What do you think the effect would be if we were to raise the tax free thresh hold to say 20k? Cheers
Interesting...
Absolutely. We've had the idea in actio for ~14 years and inductively know the results by now. I can't believe the idea has any credit! Fair enough to push productive investment somehow (policies for specific sectors of investment, i believe there are already for houses and wind turbines?) but that's really not what trickle down is!
Another rule of capitalism is generally negatives are the only things to fall down too. A corporation will not for example increase wages due to having excess, if the production line is considered efficient.
Id love to see you as an economic expert on left leaning media sources. Very few leftists are as educated and knowledgeable as you are in economic theory and you can be a great asset to the leftist media community. all the best, love your content.
Hi Gary, thank you for your work, it's really important (not that you need me to say that). When you talk about the hundreds of billions transferred to rich during covid and the energy price cap money, how does the money get to them?