Money

[LittleBigMan]

If EVERYONE rode bikes instead of driving cars, how much money could they SAVE?

Would the world be RICHER?

How does this compare with the "boost the economy by spending" mentality?

Who is right?

Don't argue that it won't happen. I know that! (But it could happen to you! )

:D

[Chris L]

Originally posted by Pete Clark
How does this compare with the "boost the economy by spending" mentality?

Who is right?

I think I do boost the economy by spending (as much as I can in my current situation, anyway). I just choose to do so by spending on things other than a car.

[JonR]

I'm no economist, and economics remains largely a mystery of which I'm willing to remain ignorant to the grave (which isn't that far away, now, anyway). But from what I do understand, it appears to me that "richness" of the economy depends to a large extent upon a healthy, if often delicate, balance between capital (if that's the right word; funds, anyway) that people possess, and the capital put back into the system by those same people. I think of it as similar to the circulatory system in animals or humans: it has to keep healthily active, through periods of rest and exertion (sound familiar?), in order for the organism to thrive. In the case of the economy, the organism is society as a whole.

So spending is absolutely necessary, but so is a certain thrift, in order to permit spending further down the road.

Money just SITTING anywhere doesn't do anybody any good, except for its POTENTIAL. The potential is for spending and reabsorption into the system.

Chris would understand all this much better than me because he studies accounting.

Gotta go now and buy something frivolous; it's my duty. :beer:

[MichaelW]

Economics is such a basket case science. Nobody understands economies, esp economists. Everybody wants more of everything, and growth is always good, but we tear up the natural world to make useless stuff , then tear up the natural world to find somewhere to throw that stuff away. All the way along, someone makes a profit and the economy grows, so it's good.

[Chris L]

Originally posted by JonR
Chris would understand all this much better than me because he studies accounting.

I'll explain this briefly. Consumer spending (along with Government spending and a number of other things) does provide a boost to the economy because it creates a demand for the production of goods and services, and this production creates jobs. However, the argument about "buy a car to boost the economy" is flawed in three key aspects in my view:

1. It doesn't matter what this money is spent on. If you spend $10,000 on a car or $10,000 on straws - either will employ people in it's production. By spending my money on things other than a car, I'm still helping the economy.

2. Michael W raised a pertinent point. What's the point of employing everyone in the country in an attempt to produce 60 squillion widgets if nobody can drink the water that comes out of their taps?

3. Consumer saving is also useful because people eventually retire from the workforce. If they have enough money to support themselves, it leaves tax revenue $ available for Government spending.

*SIGH* You can see why economics is referred to as the dismal science.

[JonR]

Thanks, Michael and Chris, for making some good points worth thinking about. :)

[Dutchy]

It doesn't matter what this money is spent on. If you spend $10,000 on a car or $10,000 on straws - either will employ people in it's production. By spending my money on things other than a car, I'm still helping the economy.



I'm not an Economist, so don't take this too seriously :-)

The difference between a car and other products (straws) is that a car has hundreds of parts that are
usually manufactured by other companies, seats, engine components, radiators etc. Then on top of this you have, stereo systems,
mag wheels, exhaust systems, window tinting , insurance blah, blah, blah. So something as complex as a car has
many companies that depend on the sales of cars to stay a float. Not to mention the ongoing costs, repairs,
new tyres, servicing. All this adds to up to a huge industry, that keeps people employed.
It's sad but true. The more cars that are sold the more jobs that are made.

Then there's car accidents. Tow trucks, police, ambulance, hospitals what would all these people do if
the car was never invented :-)

I could be wrong, it's just my view.

CHEERS.

[Chris L]

Originally posted by Dutchy
The difference between a car and other products (straws) is that a car has hundreds of parts that are
usually manufactured by other companies, seats, engine components, radiators etc. Then on top of this you have, stereo systems,
mag wheels, exhaust systems, window tinting , insurance blah, blah, blah.

Well, it's all about quantity too. I mean, sure, all these things have to be made, but only one of each if one person spends $10,000. If you spend $10,000 on cheaper products, how many of those have to be made? As I said, $10,000 of consumer spending will benefit the economy regardless. The whole "buy a car" thing is just propoganda.

[LittleBigMan]

I can't help it. But even at a young 42 years of age, every time I see a nice car, I end up thinking what it will cost to keep driving it for the next 10 years.

I don't get headaches often, but that's because I don't think about this often, either.

Oh, by the way--the beautiful 1996 Mercury Mystique my mother in law gave my wife just broke a water pump. The extortion fee was over $800.

:crash:

(I could have gotten a nice new bike.)

[Feldman]

IMHO economics is no more a science than astrology--there is no fixed reality in the physical world that supports it, it's orthodoxies vary with the political system that it is studied under. It is a religion--that is, a human-derived FICTION that a certain number of people agree to treat as fact. It seems to me that no essentially honest person can be an economist, the ability to accept and propagate untruths is part of the job description.

[Tina]

If EVERYONE rode bikes instead of driving cars, I would not be fortuate enough to have the life I do today. Living in the Motor City, vitually everyone I knew's family worked in the auto industry. My dad, my uncle's, my friend's dads. Even I worked for an auto supplier until 2000. While I'm making efforts at a less car-dependent life for myself, I have to remember that were it not for the auto industry, I wouldn't have had food on the table, clothes on my back and a roof over my head growing up. Sure, you can argue that there are other jobs in this city - but how many of them would pay enough to a man with only a GED to support a family on?

[LittleBigMan]

Originally posted by Tina
If EVERYONE rode bikes instead of driving cars, I would not be fortuate enough to have the life I do today. Living in the Motor City, vitually everyone I knew's family worked in the auto industry.
I understand your point, Tina. There is nothing wrong, in my opinion, with making an honest living.

But if EVERYONE rode bikes instead of driving cars, you would still be fortunate enough to have the life you do today and everyone in your family would be employed in other industries.

Also, there was a time when Americans could depend upon manufacturing jobs to bring home the bacon. But now our economy is changing away from that and moving into an information-related economy. That's where the jobs of the future
(and present) are.

[Spire]

Well lets say that you buy a car ( we have to compare apples with apples here) and that sets you back lets say $30,000, because you are not buying the cheapest bike either. Say gaz amount to $700 a year and maintainance over the life of the car is the same $700 incl tires and oil etc... Inurance is probably another $1000.

So over 10 years you have $30k + 7k +7k +10k = 54k

now for bicycle. Say over that 10 years you buy 2 bikes at $1000 each. You spend $100 a year on maintenance. Also you can't help yourself so you spend $400 a year in upgrades too.

So over 10 years you have $2k + $1k + 4k = 7k;

hmm accordering to my highly accurate calculations you save $47k. in 10 years or $4700 a year.:D

:beer:

[ViciousCycle]

Remember, corporations define the way that we use the word "economy."

When news reports pay daily homage to the S&P or the Dow Jones Industrial Average or the NASDAQ, we must remember that these numbers ONLY take big corporations into account. MUCH economic and job-related activity is never reflected in these numbers: local businesses, local food producers, the entire non-profit sector, public service work, and any business where the private owners/employees care more about controlling the future of their business than in offering shares to outsiders.

When news reports daily blast "the consumer" for not buying enough, we must remember that things that people actually need aren't even available for sale. Many people find great shortages of affordable housing, affordable healthcare, and affordable communities (i.e. communities where one can live, work, shop, and socialize without the enormous financial drain of being automobile dependent.)

[Matadon]

Originally posted by ViciousCycle
When news reports daily blast "the consumer" for not buying enough, we must remember that things that people actually need aren't even available for sale. Many people find great shortages of affordable housing, affordable healthcare, and affordable communities (i.e. communities where one can live, work, shop, and socialize without the enormous financial drain of being automobile dependent.)

And how! I would commit($FELONY) to live in a town in the U.S. where I could go car-less without having to arm myself with an AR-15 and body armor.

It really is amazing what looking at the present transportation system from an outside view; more and more people, driving more and more cars, pushing for more and more suburban sprawl. The area around where I live was, twenty years ago, pretty decent farmland; now, it's all suburbs, malls, gas stations, and cul-de-sacs.