Friday, January 19, 2018

Why 'Trickle Down' Will Never Work

For ages - since the 1970s in the US, to be more precise - some people have advocated for ‘Trickle Down Economy,’ which will make everyone have more money by making sure the rich can make more money. The latter will be achieved by giving them less regulations for their companies (such as minimum wages or suchlike) and forcing less taxes on them. That is supposed to make them spend more money which will then lead to more jobs and more money for the middle class and the working poor. But does it work? Well, obviously not.

Before we get back to the ‘obviously not,’ we have to talk about the economy as a such and how it works. Every economy on our planet (yes, even in communist countries) is based around consumption. Or around supply and demand. Both are essentially the same, because supply and demand (what is offered and what people want) leads to consumption. What drives economy is actually the flow of money. As long as money is flowing, as long as we all consume the goods and services offered to us, economy works. Because we make the demand and, as workers, we also make the supply. We keep the money moving, by buying goods and services and by earning the money made by those goods and services. It’s a huge circle, albeit not the Circle of Life™.
So far, everything is pretty clear, I think. You get money from your work or through other channels (perhaps through investments, through the government, through some inheritance) and you use this money to buy goods and services you plan to consume. Consumption is very important, okay? Because if companies just pushed goods back and forth, the production chains would disintegrate and everything would go broke.

With this in mind, we have to ask ourselves the next question: who is keeping most of the money running as a consumer? Is it the poor? The middle class? The rich?
Actually, it’s the poor. You see, there’s a lot of poor people and they usually have to use up all the money they make in a month just to pay for what they absolutely need (shelter, food, necessary utilities, what you might call their ‘overhead’). Sometimes, they make less in a month than they would need just to go on staying alive. What would happen if they got a little more each month? They’d probably spent it, too. Not because they have no idea how to keep their money together, but because they’re far from the point where they can afford not to spend it.
The next-biggest group of consumers are the middle class. They keep a little money on the side, save it up, but usually with a specific idea. They want to buy a new car, send the kids to college, or go on a nice vacation. They might also put aside a little for the ‘bad days,’ but those do come sooner or later. They pay for their overhead, they can afford a few luxuries, but they still hand most of the money they make back to economy. What if they got a little more? They’d probably spent most of it as well. They might put a little of it in the ‘bad days’ account, but most of it would go back into economy.
The smallest group of consumer and the only one with a strange problem are the rich. They only spend a relatively small percentage of what they make in a month, even though they nominally spend a huge amount, of course. But they are few and compared to what the rest spends during the month, all rolled together, it’s not all that much. And the problem they have? There actually is an upper limit to what you can spend in a month. You see, they’re not spending so little of their income because they’re all Scrooges. Some may be, yes, but quite some of them dive into all the luxury they can imagine. They spend a lot, but they make much, much more than what they spend. And so the money adds up in their accounts. They would spend more than they have already, but, oh, it’s the first again, the new money is in the account, the spending is reset. And this is the group which ‘Trickle Down’ advocates say needs more money. Think about it for a moment, I’ll wait until you’re done.

In the 1950s, Franklin Delano Roosevelt had a very shocking plan. He wanted to put a 90% tax rate on the net income of all companies in the US. Nine out of every ten dollars net income should belong to the state. Was he greedy? Was he mad? No, he was neither. He was clever.
You see, the net income is what a company makes in a year after all of their spending has been subtracted. Every dollar they spend on something, be it resources, personnel, research, machinery, advertising etc., does not count for the net income. And that was what he wanted: he wanted the companies to spend more money, so they wouldn’t have to pay that high tax rate. How could they spend it? On bonuses at the end of the year. On higher wages for the employees. On new machinery (which means buying as a consumer from another company). In new branch offices somewhere else (creating new jobs). On research and development. Boy, can you leave money in R&D. It’s basically a bottomless pit in a lab coat. Like this, Mr. Roosevelt thought, they were investing in their communities. And if they didn’t want to - well, then the 90% tax rate would allow the communities to invest instead.

He didn’t get the 90% rate, but he did get 70%, which was also fine. And the tax rate stayed at 70% until the 1970s, until someone told Ronald Reagan that Trickle Down was a great thing and companies and their owners needed to be able to keep more money. Until then, economy in the US was booming, because a lot of money was on the move. Employees were paid well, the middle class had a solid foundation, the poor were slightly less poor than they are today. After Trickle Down became a thing, wages went down in relation to the costs of living. People made less money, people could spend less money. Production moved overseas, where it was even cheaper. Nobody asked who was supposed to actually buy the products if nobody in the US could still make money. Greed ran rampant through the economy, through the management offices everywhere. Manager wages rose higher and higher as the wages of the actual employees fell. The job market shifted, people started to work two or three jobs, just to keep afloat. Not for something extra or some luxury, just to pay for all the bills and the rent and the food, for their overhead. Temp agencies sprang up, at first only as a help for employers who needed someone quick and for a certain time (temporary, which is where the ‘Temp’ comes from), then to rent your workforce for unlimited time.

Today, the US, where everyone thinks the economy was basically invented, has a greedy businessman (well, a greedy man who has managed to tank businesses which should be un-tank-able, such as casinos) as its president who only looks out for himself and his friends. And people still believe that Trickle Down will start working right now … or next year … or sometime in the future.

Wake up! It’s never going to work … unless you’re rich!

Thursday, December 21, 2017

Sunday, January 22, 2017

A different kind of strategy

I like playing strategy games. I enjoy plotting and planning. I also enjoy playing business simulations and building games, though. Because of that, I soon realized that “Offworld Trading Company” was a strategy game and not a business simulation or a building game, despite its look.

I stumbled over OTC a little while back at GOG, during one of their sales. The game looked like a building game of sorts to me and I decided to buy it for myself. After playing through the tutorials, however, it was very obvious I had not bought a building game. Nor was it a business simulation, despite how well it simulates the movements of a market. It was a strategy game, but an unusual one.

Why was it unusual? Because it’s not the kind of game you imagine when I say ‘strategy.’ You don’t fight with soldiers and tanks and other weaponry. You fight with money. You do not set out to destroy what your enemies have built. You buy them up and use their production for your own gain. That makes it a very interesting and challenging game and I do have a lot of fun with it.

I also like the setting very much. Mankind has started to colonize Mars. But the colonies up there need a lot of things: food, water, air, building materials, and so on. This is where companies from earth and companies only created for this venture step in. They provide what the colony can’t create by itself, because they have a lot of other work to do. They build farms and sell food. They build wells and sell water. They build converters and sell oxygen and hydrogen (which serves as fuel). They build mines and sell aluminium and iron. They build factories and sell steel, glass, electronics, chemicals. They even build structures like the pleasure dome and profit from the workers relaxing and having fun in there. Or they even use their money and resources to expand the colony.

But, as with the Highlander, there can be only one. To make the best out of the deal, only one company can cater to one colony. Since several usually set up close by, the only way to become this one company is to eradicate the competitors. And since open violence is frowned upon, the companies fight with shares. Every company has a total of 10,000 shares. 2,000 usually are owned by them at the beginning. If you own 6,000 shares of another company, they become your subsidiaries. If you own all 10,000, they become part of your company. Shares have to be bought at market value and in packages of 1,000 shares. If a company owns at least 5,000 of its own stock, you have to buy those in bulk. If they own more, not only do you have to buy in bulk, you also have to buy for a much higher price. So it’s in your best interest to make sure you buy in early.
How do you make money? By producing goods and selling them. It’s literally the only thing you can do in this game. You can buy from the black market, to protect yourself (with the hologram or the goon squad) or to damage the others (with the pirates or bombs), but that will only give you a slight advantage and the more you partake in the offers of the black market, the more it costs you. Trading offworld with a rocket brings a lot of money, but to get there, you need to earn a lot first. And you only have limited space, too.

Limited space is actually where this game becomes a strategy game. With every upgrade of your headquarters, you get a number of new claims, which means you can build a couple more structures. You can also buy claims from the black market, but, as mentioned, that gets more expensive every time. You have to plan what you want to buy. You can destroy structures again and build something else instead, but you don’t have enough claims to build up a huge production. You need to decide what to build and what to do with it. Do you want a second offworld market (the rocket) or do you want a hacker array to manipulate the prices with? Do you want to invest in research or do you rather want to overproduce on food and send out rocket over rocket to the asteroid belt?
In the end, it doesn’t matter what strategy you have for making money, as long as you make much of it quickly. At the beginning, the shares usually are in a range of $15 to $17 a share, which means you need around $15,000 to $17,000 to buy the first package. After you start buying, as with everything on the market, shares go up in price. Do you want to go ‘all out’ and buy in bulk, even though the last packages will be very expensive like this? Do you want to buy a package here and there, which is cheaper, but will allow the other player to buy up shares as well to make it harder for you? You can cash everything you have in at once and use the money to buy up package after package, but what if you lack a few thousand in the end? It will take you ages to build up your stock again. You can go the safe way and buy shares only when you have enough money on the side, but that gives your competitors time and resources to do the same to you - or to buy their own shares to force you to buy in bulk. That is where the game becomes challenging. Have I also mentioned the game runs in real time? This isn’t one of your 4x4 turn-based affairs, despite the hexagonal tiles.

And you have the choice between four types of companies, too. There’s the expansive fraction which seem pretty much the regular ones. They have advantages in freighter movement and building and get extra tiles per upgrade of their headquarters. There’s the scavenger fraction who are connected to the black market much better. They build with carbon instead of steel, so they don’t need steel mills, they learn about shortages in advance, and they can buy from the black market more often (all companies have a cool-down time after buying a black market offer). There’s the scientific fraction which has the advantage of technology. They can build production buildings on resources to cut out mines, quarries, or wells, EMP attacks and power surges are over more quickly for them, and they can do their patent research faster. Finally, there is the robotic fraction which doesn’t employ humans. They don’t need life support (food, air) and work on power (of which they need more, of course), they use electronics in upgrades (and don’t need glass), they don’t need hydrogen fuels, and their production buildings become more efficient when next to a building which produces their resources.
The choice of the fraction has a huge influence on your strategy. Robots can settle even in places without water resources (or ice) nearby. They can produce food to sell it (same goes for oxygen and hydrogen), but they can totally forego water and invest in other buildings. Scavengers can do without iron and steel. Their close connection to the black market allows for pulling a lot of tricks on their competition, such as munity (redirect resources from a building to your own headquarter for a while) or slowdown strike (lowers productivity of the building targeted and those around, very effecting in clusters). They can make use of the market more often, because of the shorter cool-down time, but they will suffer from the increased prices and lower efficiency on the same tile as well. The scientists don’t need to go for quarries or mines (except for aluminium, which is used ‘raw’), because they can build production buildings directly on a resource. But many buildings need two resources and thus they need to produce one of the resources directly or to auto-buy it. They have an advantage in research, but since their production buildings are usually scattered around, they can’t make as much use of clusters (productivity is enhanced, if production buildings of the same type touch). The expansive fraction is the most beginner-friendly of the four, it doesn’t have huge advantages (building cost, speed, and more tiles aren’t that much of an advantage), but it also doesn’t require an ultra-specialized strategy. If you want to experiment and play around, they’re the best choice.

But the core of the game which really makes it a taxing real-time strategy game is the market as a such. All of the resources, primary or otherwise, are on the market and the prices offered for them constantly change. If a player buys a lot of a resource, prices go up. If a player sells a lot of a resource, prices go down. If there is a shortage, you can take advantage of it and sell a lot of a resource at once for a higher price. If there’s overproduction, you can take advantage and buy. Every action on the market is met with in real time. Every time you click on the sell or the buy button, the prices change. Sell much at once and the price hits rock bottom, which means you don’t get as much as you thought. Buy much at once and the price skyrockets, forcing you to pay a lot more. Build a hacker array and you can create false shortages or overproductions and take advantage of them - but the competitors will suspect something and they can take advantage, too. Sooner or later, you will need to sell or buy. The claim limit means you can’t produce everything for every eventuality and you will at some point need more money than you have, too. You might have to sell so you can buy a share package, you might have to sell to meet the financial requirements for the first rocket shipment (afterwards, you usually have the money from the last shipment), or you might have to sell so you can buy a resource you can’t produce yourself. Every time, you will influence the market and your competitors can see it. And that is what I like about the game. I like it that you have to outsmart your opponents, that you can’t just rush at them. You can’t just produce more than everyone else, because you lack space for that. You can’t just make soldiers and overrun them. You have to devise a strategy to make money faster than they do.

And the games don’t take that long, which is a plus for me, too. Instead of spending hours with advancing my culture in AOE or AOM (which I also love playing) to build up a large army, I need to advance my headquarters, build up a production, and find a way to efficiently sell what I make so I can buy the others up.

OTC is a very good example of taking a genre into an unusual setting and making it work. So if you like strategy games, I suggest you give it a chance or at least a good look.

Wednesday, November 09, 2016

Dear Americans

Dear Americans,

in 1949 you brought Germany the first real democracy in our country. After the failed attempt during the Weimar Republic, which led to the election of Adolf Hitler and through him to the Third Reich and World War II, you brought us one of the most stable and efficient democracies in the world. We are very grateful for that (apart from a few right-wingers and a few hopeless people who live in the past).

With your 2016 election, you have, however proven that you are in dire need of a true democracy yourself.
You have been holding on to an old institution called the ‘Electoral College’ for too long, for one thing. An American friend I spoke to recently thinks it serves to make sure stupid people (or uninformed people, as it is put officially) don’t take too much influence on the election of your president. Well, that either means you’re wrong or it means even intelligent people voted for Donald Trump. I choose to believe the first one, because I can’t imagine any person who is intelligent would vote for a con-man who has no plans and will destroy everything his predecessor, one of the best presidents you’ve had, has built up in eight years in office. The bottleneck of the Electoral College means that a lot of votes go unnoticed every time. It doesn’t matter whether a party wins a voting district by a few votes or by several hundreds. If it wins, the other votes cast don’t matter for the rest of the electoral process. It also validates the technique known as Gerrymandering - a way to make sure as many voting districts as possible will go to the party the person doing the Gerrymandering favours. Get rid of the Electoral College and just count out all the votes. Overall, you might get different results.
You make the electoral process look like a huge party. You make it extremely focused on entertainment. And you make it extremely important that the candidates (and their parties) raise a lot of money. It’s no wonder the candidates in the end were both extremely wealthy. But how much do people with millions in the bank know about the struggle of the common citizen? Not much, usually. Yes, candidates should speak about their plans for the presidency. They should take a stand on political and social topics so the voters know where they stand and what to expect from them. They should not make a show out of it. The showman is close to the con-man (not all showmen are con-men, but all con-men are showmen) and will rarely keep his promises after the votes have been cast. Cap the amount of money candidates can invest. Like this, money isn’t that important for becoming a candidate.
Make sure the polling places are controlled. Not to avoid voter fraud as a such, but to make sure people are not bullied (for example by armed people standing outside and threatening those they think will vote for the other candidate) or are turned away, even though they have the right to vote. Having a system which gives every citizen the automatic right to vote might help. Make sure everyone has the chance to get a photo ID (meaning making sure everyone can afford one) and make the photo ID mandatory for voting. To get a photo ID, you need to be a citizen - which means a person with a photo ID is eligible to vote.

Many years ago, you brought a country you had just defeated in war the wonderful gift of democracy. Please do not allow things to go badly enough this country needs to be part of a UN mandate during the next elections to make sure America stays a democracy.

Monday, October 17, 2016

A New Clue

So there might be a remake of the “Clue” movie. I’m not really sure what to feel about that. I mean, on one hand, remakes can be good (even though quite some aren’t). On the other hand, “Clue” was mostly as good as it was because of the cast, most of which, for one reason or other, won’t be available for a remake. I’m not sure someone can successfully replace Madeline Khan as Mrs. White or Tim Curry as butler Wadsworth. That doesn’t mean, though, I can’t be wrong.

The original “Clue” movie, thirty years old by now, is one of those secret gems which you either love or hate. There’s really no in-between. Either you enjoy the take on the classic Manor-Murder-Mystery genre as written by the likes of Agatha Christie or you simply find the jokes off-base and the whole story convoluted. I learned about it by accident, when a TV station showed it and I zapped in and stayed. Afterwards, I went on a hunt for the DVD and found it. Since then, it has been in my DVD player oodles of times. I just love the movie.
“Clue” is a comedic take on the classic mysteries which bring together a group of people at a place, show you there’s nobody else coming or going, and then have a murder happen. Who did it? In addition, the movie is loosely - very, very loosely - based on the board game by the same name. The six suspects take their names from the six suspects of the board game (Colonel Mustard, Miss Scarlet, Mr. Green, Mrs. Peacock, Professor Plum, and Mrs. White) and the ground floor of the mansion is cut like the board itself (including the secret passages between the corner rooms). Mr. Body, the victim (first victim in the movie), is also from the board game, but has a different background. By the end of the movie, six people have been killed (none of them one of the suspects, of course) and the question of who the murderer is looms in the main hall. It’s then when Wadsworth, the butler, will clear up the case, one way or other.
Originally, “Clue” had a little gimmick, like many movies over time. It came with three different endings, each of them putting the blame of a different person or different persons. In the DVD version, you can either have a randomly chosen ending or you can watch all three endings one after the other (with the classic ‘the butler did it’ ending as the ‘real’ one).
But it wasn’t the gimmick which made “Clue” a classic over time. Like some other classic movies, it was a sleeper - a movie which didn’t do too well at the movie theatres, but had a long and strong life afterwards in rentals and on TV. People enjoyed the movie, even those who were far too young to watch it when it was released. The movie has a lot of great lines which can be quoted in a variety of different situations. It had a great cast, too. And it managed to keep the comedic tone despite the six murders, which isn’t easy, either. It’s also one of the few movies in which I can endure Angela Lansbury for one and a half hours. (Two others being “Death on the Nile” and “Evil under the Sun.”) She pales a little against actors like Tim Curry, Christopher Lloyd, and, above all, Madeline Khan.

Now there’s talk of a remake and I’m not sure if I want that. There are movies which have the perfect formula, but a formula which only works with all the ingredients the way they are. I have the feeling “Clue” might be one of those. The fact alone that it was a sleeper and not an instant hit points to it for me.
What I’m most worried about, is the off-chance of a gritty remake. Admittedly, a movie with six murders might qualify as gritty, but the fact that “Clue” managed to keep the comedic tone even with all those murders was one of its strong points. It wasn’t as if the characters made jokes about the dead, but the way the movie handled the murders and, in some cases, the hiding of the corpses (the party scenes to hoodwink the police officer especially), was fun and classy at the same time. The way the reactions dampened from the first murder to the last (when the Singing Telegram girl hardly got a reaction out of the group) was both amusing and fitting, since there is a moment when the mind will just shut down.
A new movie might not be up to par with that. On the other hand, there is also a (slight) chance the remake might be better. Perhaps there will be an even better chemistry between the new actors. Perhaps the jokes and puns will be even more on point.

Fact is, whether or not the fans want it, if the owner of the rights wants to remake something, they will do so.