Child poverty in the UK
According to a article in today The Guardian, there is several millions of children living in poverty in the UK.
Is it that bad? Or is it just a natural consequence of the low minimum wage and persistant unemployment in some areas? The article can be found here: http://www.guardian.co.uk/society/20...ocialexclusion |
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As poverty is a relative term, i'm not sure how it can really be avoided completely. Minimised, yes, but avoided? hard to say.
Diligent and caring parents help the status of poverty stricken children in either respect. |
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I really wish you'd add some content to these threads. It's pretty much impossible to get your point across (and get people to listen to it) when you act like such a ****.
Nevertheless, isn't child poverty the reasons Labour apparently pumped so much money into benefit, and the reason we've got a "benefit culture" now, or so I'm told? How do they define child poverty, anyway (I haven't read the article; not going to, either - too busy, not busy enough to call you a **** though - strange that)? How would you solve this problem anyway, Comrade? That might make for an interesting. Try it; you might like it. |
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It's because we don't live in a socialist paradise where everyone gets the opportunity to starve equally
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*Madonna, Gary Glitter etc... |
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All the kids I know have mobile phones, they're all LOADED!
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I've noticed Tomkat. I had to take it away from them, during lessons, when I was out in practice in secondary school a few weeks ago.
But back to the subject. What would be needed to end the child poverty? A higher minimum wage? Coupled with a drastic reduction in unemployment? |
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According to that article child poverty is where "children [are] living in households with less than 60% of the national average income after taking housing costs into account."
As mentioned previously poverty is measured against other people and is as such bollocks. I predict that using the current standard more and more children will be brought up in "poverty" as the rich are getting far richer (rather than poor people getting poorer). |
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I've often wondered where profits (and general increases in wealth) come from. Can anyone explain it to me in, say, 20 or less sentences?
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If I build a PC someone wants to buy, I have created wealth. I'm not touching 'profits'. |
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Now, these arent the big corporations like microsoft or big office block towers or whatever, a corporation is just a legal personality which essentially limits the maximum possible liability to the owners(/shareholders). That's not the essense of the benefit though; the fact that corporations are taxed differently is of major benefit. This, combined with corporation's tendency to purchase assets, rather than the liabilities of middle classes (eg, homes, cars ... boats etc), means that they generate and accumulate wealth (profits), with compound interest*. Say, i'm a middle class person. I get a cuahy government job which pays me a pretty good but not outstanding wage. This is the only source of income for me. I then go out and get a mortgage - i have just purchased a liability that will take 20 years to pay off. I need a car to get to and from work, as i'm middle class and thus cant use public transport. I just purchased another liability - probably on credit as well - which i also need to pay off. Servicing both of those loans means that (often significant) part of my wage is going on these expenses (thus, money going "out"). Then there are bills to pay, perhaps school fees if i'm a bit older with kids, and so on etc. Also, as my wage increases i tend to purchase more and more (money going out) generally useless things like plasma tellies, mobile phones, widgits, trinkets and baubles, toasters and the occasional flower pot. Again, money going out. Now, say i'm an upper class person. I once had a pretty good paying professional job (more likely to be private than government, but anyway). First thing i do is set up Soveh Corporation. I get a wage from my job, which goes into this corporation. on behalf of me, this corporation buys assets like real estate and shares (a mix depending on risk profile, a different matter). These assets generate income (rent, dividends) which can be re-invested into the corporation, or withdrawn from the corporation and paid to its owner (me) via its own dividend or whatever, to pay for bills and so on (a new source of income; wage and dividends). If i need a new car? well, the corporation purchases it on my behalf (a company car) - the liability is now the corporation's, not mine. Go to dinner with (my assumed) wife? Business dinner, out of the expense account of the corporation (to an extent). Remember, the idea of an expense account from your corporation is to spend as much money as you can, because you're corporation is taxed on the after expenses income for that corporation (so you're buying stuff with pre tax dollars: tax is usually ~40% or more of income so the extra goes a long way) - more money spent on stuff for the owners, less corporate tax to pay. Also, the corporate tax rate is actually less than the income tax rate I would otherwise be paying. Further, because the corporation owns all the assets, because the corporation is generating all the income [except wage], and so on, I personally pay very little in the way of tax. Which means more money for me, less for the government. By the way, this is all totally legal (at least in western countries), so any objection that you have is a moral one, which is clearly not an issue if you're trying to make money. Anyway, as the assets of the corporation grow (they will be very modest to start with, but after 10 or 20 years the expected accumulation will beat the pants off a home that you may or may not actually own), your personal income changes in its mix; you become less and less dependent on your wage - you can work less and less for money, and let your money work more and more for you. Indeed, some people who do really well at this dont have a wage-job, they just manage the assets of their corporation to the extent where they live off that expense account, and they dont get anything in the way of tax or whatever. Divorces are less messy as well, as technically you dont actually own anything (the corporation does). Means that, as a male, you might actually "win". (depressing, isnt it). So, Mz, not 20 sentences because its not really that simple. But there's just one common method of the difference between rich and poor: rich buy assets, middle class buys liabilities that they think are assets, and the poor cant do either. *which isnt just interest from a bank, generally its growth in assets (or income via dividends, rent, etc) expected to perform above market interest rates otherwise you would choose the (much) less risky option of putting cash in a bank. |
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Rather than that, some structures in place that permits more social (or at least, economic) mobility would be a much better way of addressing the problem, rather than top-down enforcement of total equality (which doesnt work). |
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Ignore it at your own peril. At 22, "i" own two homes in the world's most expensive city, i have some shares (though not all that many now - i did use my economic training to essentially dodge the crash in the middle of last year by pulling out about this time last year. At the time, i felt really bad as i missed about three months of really high growth, but i'm much happier now), my superannuation is really high compared to most, but ample given my age. My friends are either breaking even (ie, constantly broke) or only slightly positive but still renting or whatever. I am feeling like i'm becoming richer, and thus i'm more willing to take risks which is making me richer still. Sure, i have three jobs and doing my honours. But at least i'm putting the moeny to good use! As for money that already "is", that's true. I didnt start from nothing. When i was 17 i had about $600 that i had saved up from my pocket money over the preceding 10 years. But that doesnt mean that you cant earn more efficiently. Wealth is different to GDP, which is different to income, etc. Generating economic growth is probably what you're thinking (?), which involves growing more foodstuffs, mining more resources, producing more products, engaging more services and so on. A wealthy person tends to have alot of assets like property or shares - that doensnt mean that they are producing much in terms of GDP, they just own more things. I apologise for misinterpting what you meant. |
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I've actually think about stuff like this quite regularly. I have one question (well lots but one key question), say you're trying to dodge the whole "splitting your assests at divorce time" kind of vibe then how does having your assests in a corporation stop you from having to split them? You must have some kind of ownership of the corporation (shares or whatever, even if it is all of the shares) so i would think that your (now ex) partner's lawyer would go after them. |
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Second question: To own more than one property you must be in the buy to let market. My understanding of the mortgage products for that market is that you already have to own (/have a mortgage on) a property to be able to get a buy to let mortgage on another. As such you would only be able to fire one property into your company's assets as i would think the bank wouldn't allow you to say your primary residence belonged to your company. What is your experience of the situation Ultimate Newbie?
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Apparantly, if you build a new house at the same time as a factory, it's easy to class it as a company expense.
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The corporation ruse is quite popular in the UK apparently. I was speaking to an old friend who wanted his employer to put him on a contact instead of a salary. Then he'd set up his own company (which is just a matter of paperwork and doesn't cost too much), which his employer would use to pay him instead of paying him directly. He'd do this because there are significant tax breaks for "companies." I think he'd thought about the moral problems of this because he soon injected, "everyone's doing it!"
If you wanted to really make profits from this, you'd go to the Isle of Man; there's a reason HSBC has a lot of its operations on the Isle of Man. The Isle of Man is quite a good option, too, because it's doesn't look as dodgy as placing all your cash in some country few people have heard about and a country that's not renowned for its banking prowess (read: as opposed to a posh tax haven). Anyway, essentially the social problem comes down to whether you believe in trickle-down economics or not. I've a bias against trickle-down economics; but I'm far from sure of my position. Essentially, from what I can tell, the trickle-down economics argument has to centre on the argument that providing tax breaks engenders the creation of more businesses. More businesses mean more jobs. More jobs means more income. (There's also the argument that tax breaks will persuade businesses to give up their offshore financial accounts and place their money back in the country where it'll receive at least some taxation, but that's largely peripheral to the trick-down economics arguement.) The trickle-down economics argument, however, seems assumes those receiving tax breaks will reintroduce their money into the country/market to create more businesses (thus jobs) and more demand for more houses, etc. However, most people use their wealth as a positional good i.e. "shit, check out how much more money i have than you", and the majority of corporation wealth falls upon a small number of individuals who produce much less demand than a large number of people with a moderate amount of wealth. |
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Oh and GDP is the amount of produce a country produces. This is different, although often not realised, from the quality of life and wealth of a population.
It would only equate to the wealth of a population if everyone in the economy was actually producing a tangible good to sell i.e. everyone man, woman and child is essentially a business on two legs selling something. However, people are mostly wage-labourers, who have their income decreased by labour competitiveness, as the produce and efficiency of a company increases. There's simply a huge gap between wage-labour (and all that goes with a higher income) and produce, and GDP focuses on produce. If an increase in GDP equalled an increase in income for the average man and woman, the United States would be renowned for its social equality. |
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they just closed this. |
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However, to the extent of my understanding, it depends entirely on how you would structure your corporation. If the sole legal owner and shareholder was you, then you're in a commanding position. If you, personally, lived off your wife's income or she somehow or other supported you financially, then its possible that she might be entitled for compensation in that regard. If you have children, and you are not the primary caregiver, then its possible that you will be required to arrange for the provision of your children (particularly education), however that's much more contestable (though, why would you??). If your wife was a co-owner of the company, then its all hers too. If she made contributions to the funds of the corporation, then that also opens the door (at least, her lawyer would argue that she is a creditor or somesuch). But seriously, if you're concerned about this go seek legal advice. The point is, having a corporation which is legally distinct from you means that its probable that much more of "your" assets would not be "lost" to your spouse should you divorce, than if you personally actually owned them. |
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ie, countries that facilitate trickle down economics do better than those who dont, but just because a country has the structures in place doesnt mean that it actually occurs. So, A leads to B, but B doesnt necessarily lead to A. The IMF, and to a lesser extent, the World Bank, doesnt seem to understand this. The IMF is generally shit. Quote:
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It seems an unfortunate human predilection to voraciously seek social esteem and status. In the feudal epoch, bloodline served this person. In this epoch, capital and the goods that capital affords serves this purpose. As I should have articulated by now, I am against this positional (social esteem and status) predilection of humanity, and I am thus against the use of capital for this purpose. |
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You misunderstand. Improving the living standards and prospects of the poorest members of society = good The current method which determines who the poorest members of society are = bad |
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*not sarcastic, honest |
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*The IMF only uses GDP, not even GDP per capita, to base all their conclusions and etc on. This is one core reason why they're shit at their jobs. Quote:
I think focusing on the fate of one specific group (in this case, the poor, which is a bit different to the usual practice but its the general principle that i'm talking about) is a bad thing. You need to see how everyone in an economy interacts with that economy otherwise you'll get systemic problems that you wont detect. Quote:
So, Gold promotes investment into the future, at least to an extent, though not right now. Quote:
Why not be a positive person? :) |
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Compare the children in Zambia to the children in the UK. Suddenly we find the children in the UK are incredibly rich. Take away their food, cell phones, electricity, clean water, sewage systems, computers, free education, libraries, etc., and they really seem like they are living in poverty. |
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Interestingly enough, i still think altering the definition of poverty to something that includes the destruction of hope, the prevelence of misery and perceived barriers to progress might be a better psychological indicator.
But then, every one (particularly women) would feel as though they are poverty stricken. Perhaps they are, but they arent (yet) dying by the score. Its still relative. |
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The best way to be happy is to either fulfill your dreams, or not dream in the first place. Without expectations you can't be disappointed. |
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Of course, you could argue that it's capital's intelligence that convinced it to 1) retreat from Asia in the mid-90s and 2) become extremely tentative about the US and the UK at the moment. Yet, in both cases, the economic "fundamentals" did and do not correlate to capital's behaviour, primarily, its exit. Essentially, investors lack of commitment to long term investment (their preference for short term gains, as opposed to the state's preference for long term gains) causes this negative equilibrium, and, ironically, damages an economy's fundamentals. Quote:
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Personally, rather than running around "robin hood" style and taketh away from the rich, fumble it around inefficient governmental departments and crude clumsy mechanisms, and giveth to the poor, a fundamentally bad idea. Firstly, the situation that i outlined at length above (btw, rofl @ T&F, lovely observation), clearly demonstrates that the really rich people in society own nothing, but control much/everything. They wont get targeted in any robin hood scheme as by the measures employed they arent rich (plus, they're much more globalised and mobile, so pinning them down with taxes is hard because they'll just move to France instead). Secondly, the result of the above is that you're really targeting the upper side of the middle class who are either financially illiterate, lack the time knowledge skills or inclination in order to protect their family estate like the uber rich, and are typically in a similar bad situation cash flow wise - the difference is that instead of trying to pay off the repayments from a vauxhall 4 cyclinder job, they're paying off a BMW or Merc, instead of paying off a mortgage of $200000, its $1m. So, the value of the "asset"*COUGH* is higher, the corresponding expense is higher. So yes, they earn twice as much, but their expenses month-month are twice as much (or more) as well. In a strict cash flow sense, they're just as rooted as everyone else, even though they might look rich. Thirdly, the largest proportion of the population will get hit the most because that's just the way the cookie crumbles in today's society. The middle class(es in britain) will cop the majority of the burden only because there are so many of them. So the rate will perhaps be lower, but because they outnumber those above them 20 or 30 times more, they end up paying the majority of the cost of the programme. Fourthly, as i eluded to above, so much money of the robin hood programme is lost due to less-than-efficient government deparments and agencies, plus self-imposed stupidity. For example, in Australia, there is a "baby bonus" in the order of $6000 per child for every mother who gives birth, irrespective of income. The Opposition (Liberal= UK Conservatives) said that paying the baby bonus to "millionaires" isnt cool, and the egalitarian public agrees. Now, the cost of means testing every family such that those over $100000 do not receive the baby bonus costs more than actually paying the bonus to everyone. If the government wanted to save money, the limit would have to be as low as $50k per household, with an average wage (for a single person) being around $44k, this is clearly silly. Thus, its cheaper (and thus a benfit to all, plus additional babies) to not be egalitarian in this case. And finally, i'm going to be highly controversial here and say, just giving money to people in the working class(es) isnt really going to help them. Lack of financial skills means that most households will either see it as a one-off and waste it, or even those who are willing to learn and get ahead still might loose it due to the inherrent nature of risk. Either way, its improbable that such measures would result in many people in the working class actually achieving any economic (or social) mobility. Thus, entirely defeating the point, whilst still making the middle class feel overburdened, the "upper-middle" (such as it is) get behaviour-distorting and net benefits worse, and the actual rich in society dodging it completely. So, what was the point? Quote:
Is there room in economics and society for equity? What about efficiency? Read up on Pareto efficiency and stuff too. Quote:
It could be said, though, that the capital diverted away will still exist to fight another day. Its the people who dont divert away from falling shares or whatever results in "lost" capital, whilst diverted capital still exists to be readily used when there is a "sale" in the sharemarkets or property markets (eg, a recession or correction). Quote:
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Believe in progress if you so wish. I just think its a waste of time to change something so fundamental whilst you could be working on (other, more pressing) problems. Quote:
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Giving large wads of cash to people is not the same as helping them.
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I'm too busy too reply at the moment. I'll have a look next week sometime.
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i) You are bulls****** ii) Inheritance iii) They are the worst possible homes imaginable iv) You are bulls****** |
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Zaronomics :cool:
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a) There wasn't a 'crash' in the stockmarket b) his method of determining the 'most expensive city in the world' was to guess it was the shit hole he bought in |
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Do keep up.
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Fair enough. Didn't bother to read the rest.
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Now, the distinction between least affordable and most expensive is that least affordable compares the income going in compared to house prices, thus you can have medium prices and very low income is less affordable than high prices with high income. Turns out that its actually a case of high prices and medium/low income, skewed a bit. Nevertheless, the prices according that that study that I posted shows that Perth prices are similar to those of (greater?) London, which is still very far from cheap. Quote:
Its your loss. Why dont you go back to reading the Daily Tele and gossip about Paris Hilton's latest expoits?? It might help you stop thinking about these hard things. |
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What? Why do you feel there is a need to dump a few names and consider that this creates an ability to predict anything. Traders and analysts are schooled in the belief that past performance is no guarantee of future performance. Regardless of any cycles, the downturn in july-ish 2007 was caused by various factor's, no less the fact that there was less demand for cdo's, abs, morgage bonds anything highly leveraged and basically anything that was seen to be related to the housing market. On top of this due to the climate of uncertainty the institutional investors were advised to sell equities and buy commodities and quite a few smarter hedge funds were engaged in shorting of equities. Greed didn't keep them in the game. Speculation did. You do realise that there is a whole world out there other than the purchase and sale of equities? As you're an individual investor, I would suggest you take a more pragmatic approach. Stop worrying yourself with cycles and worry about the fundamentals. Look at simple things like p/e ratios, dividend, economic performance, labour figures and company reports. Quote:
That being said i have no idea how much a house costs in perth. You might be telling the truth assuming prices are a fraction of what they cost in London. I can't be bothered to check/ |
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What are your three jobs?
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Crack dealer, pimp/prostitute, stockerboker.
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now, as this is an internet forum, i dont feel like i have to go into huge amounts of detail about what i actually do each day, what i spend my money on, who i sleep with. I dont think thats appropriate. If, Zar, you dont believe me, then frankly i dont care. I will still accumulate money regardless of whether you think its possible for me to do so. Hopefully i'll be able to retire in 15-20 years so i dont have to work my arse off, sleep <=4 hours a day (though playing PA helped with that :() and get a good start in life. Whilst i dont pretend to come from the most dirt poor upbringings, it was modest. My parents were able to afford a private school education (UK=public school) and that was about it. It was up to me to make something of it, which i am endeavouring to do. Thus, in true GD style, is this where i ask you to fk off and die? *before tax ::cry:: |
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