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re: It appears you don't understand the power of compound interest
Greg — (archived)

Compound interest is one way an imbalance can grow but capitalism is innately unbalanced. For example successful people's children get better education, and the gap grows. They might make better connections with others, get better advice for investments, etc. All these widen the imbalance, though of course some will always make it even from the bottom. We know that doesn't happen often because the percentage owned by the top 10% doesn't drop. Tax havens are widely promoted by Bush, Clinton tried to close down many and the Republicans at the time stopped them. Even now companies can incorporate in Bermuda and slash their taxes, something the Democrats are trying unsuccessfully to stop. Stanley tools was a recent example.
The biggest outflows of money occur if the economy gets sufficiently shaky. The tax cuts worked fine for the people they were intended for, which was the rich. Of course it doesn't trickle down because the wealth owned by the top doesn't shrink. This is the problem with benefit of the doubt economics, they see let's try it again to see if it works this time. The result happens to be they end up with a lot of extra money out of this "experiment".
Economists know the Bush economics plans are nonsense, but this giving them the benefit of any doubt gives them what they want. Of course they never have to prove their theories before trying them.
There is a rising standard of living so that the lower classes can be better even though their percentage of total wealth doesn't rise. They participate in technological improvements but the main things like food, housing, etc don't really change.
The rich are growing the economy but only their economy. Interestingly the amount to be spent on Iraq, 87 billion is about the same amount as would cover the deficits of all the states, I wonder which one would benefit the economy the most.
The Iraqis rebuilt their country from a similar level of destruction after Gulf War I with little outside aid by doing it themselves on the cheap. Obviously they could do the same again if left alone, so all this reconstruction money is likely to be pork for Bechtel, Halliburon, etc.

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