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Couple questions 
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Post Re: Couple questions
Wiki says wrote:
In addition, wealth is unevenly distributed, with the wealthiest 25% of US households owning 87% of the wealth in the United States, which was $54.2 trillion in 2009. (citations removed)


Common Sense would dictate, after taking these figures and those unquoted from the article at large under advisement, that the public trust (note how this is not the public itself, which has even less claim to any rights over others' wealth) does not have a rightful say over where money goes, but such is the nature of taxation.

I've heard the common conservative argument for the reduction of taxes is along the lines of "the rich [in our country] have almost always invested in research and public works that, while for the benefit of the rich, enrich the greater public."

To put the concept of trickle-down simply, the rich keep getting richer and the masses ride their coattails into prosperity, and I happen to agree that this seems to be the case. Even further, I'm sure the modern phenomenon of corporate backing has always been in force, just not to this scale or lack of regulation (IIRC, older corporations and trusts were practically existing at the whim of the public and had a [very] limited lifespan and an equally short leash). To refine the analogy above, the rich keep getting richer, the masses keep riding their coat tails, and the shrewd in both camps keep trying to bash the other's brains out for a personal benefit outside of the group.

http://upload.wikimedia.org/wikipedia/commons/c/cf/MedianNetWorthChange2007.png
Going by this chart alone, tracking percentage changes through periods of years from 1989 (the year I was born) until 2007, we can see that the bottom 50%, fully half of the US population has experienced nothing but growth while the higher brackets have experienced both losses as well as fairly large gains as might be expected from observing the previous distributions of wealth. The rich have both gained more and lost more while the poorest have, on average, lost very little and on the long-view gained quite a bit.

Now to read the last page and make sure I haven't wildly misinterpreted the flow of the conversation. And it appears I have, but that's me rambling on at the slightest provocation.

Arioch wrote:
Rich people don't get to decide how their tax money is spent; government agencies and elected officials do. Please assign blame appropriately if you don't like how the government spends tax money.

Well, the rich outside of political and military complexes don't have much influence but the campaign cycles over what is and isn't discussed and brought to the floor. However, no system is ever clean, especially not the US government, I'm sure I can declare without much or any objection. The intricate weft of politics and economic powerhouses are likely to consort a great deal over many matters, so what ThatsNoMoon said is at least a cogent argument, though I don't doubt that proof is going to be difficult to scare up.


Thu Aug 11, 2011 1:44 pm
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Post Re: Couple questions
Except that there haven't been any ad campaigns or political PAC's funded by rich people to reduce federal funding for medical research. Rich people like medical advancement just as much as poor people do.

I'm not suggesting the system is "clean" -- no system is -- I'm responding to the assertion that it's the fault of rich people that we don't have a cure for ALS. That is utter nonsense.

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Thu Aug 11, 2011 2:18 pm
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Post Re: Couple questions
You misunderstand my statement, they aren't funding ads, at least not directly. Nor did I ascribe any particular motivation to any funding. I merely supported and agreed with the notion that campaign funds have purpose beyond helping elect a certain candidate or another.


Thu Aug 11, 2011 3:10 pm
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Post Re: Couple questions
discord wrote:
moon: reason is simple, very few rich people with that kind of problems.
Which kinds of disease are you talking about here? Motor function disorders that leave cognitive functions intact, like, say, Parkinsons? Just specifically ALS, as Stephen Hawking and Lou Gehrig have had? Or just any sort of disease or disorder that gradually but inevitably eliminates motor function? Which includes ubiquitous things like severe arthritis?

Because, for all of the above, yes they do. And yes the relevant corporations are paying for research for neural interfaces. There is a LOT of research, some of it even decent research, in that field. The sheer profit potential of a genuinely high-function, high precision neural interface is staggering, especially one that could be just worn as a cap like the Emotiv without requiring intrusive wiring.

It's not just something that would only be useful for serious cases, like advanced motor-neuron disease. It's something that could be sold to everyone who owns a digital device. Who wouldn't want to be able to change the channel on their television just by thinking about the show they want to watch, while turning off their household lights with a thought, and turning off the radio? Then there are things like 3d modeling, which have no real useful 3d tools to be performed with so we mostly settle for mouse and keyboard approaches. What if you could change the shape of a model to mold it like clay with a thought, instead of our clumsier current approaches? Hell, just think about text messaging. What person wouldn't want so be able to write their IMs with their mind instead of their thumbs? It's all possible with neural interface devices roughly analogous to the sort that would let an advanced-stages ALS patient freely use a personal computer.

The relevant companies are heavily invested in furthering neural interface technology, because when it goes somewhere it is going to be one of the most profitable series of patents and copyrights in the entire tech industry.

The reason we haven't developed sufficiently good neural interfaces is because neuroscience is hard. Not because nobody's trying. Not because nobody's trying hard enough. And definitely not because of lack of money; everybody knows that there are trillions to be made off of a development in the field, that it would be at least as big as, say, smartphones or tablets. Hell, every smartphone or tablet user will want one; if you're willing to pay $600 for a phone you can play Tetris on, wouldn't it be worth another $600 to make calls and play Tetris with your mind?. Neural interfaces are a huge research field with a lot of interested parties, and the first steps towards showing that the research eventually WILL pay off for someone have already been made; the Emotiv is an excellent proof of concept. A lot of very large wallets are salivating at the concept, not just in the medical field, but even in things as simple as the videogame industry.

Money is always a problem in any field of research, but it is less of a problem in this one than in, say, Type 1 Diabetes research. Because you can't make a common household appliance out of an artificial insulin pump and A1c monitor, but they're already talking about making videogames with the Emotiv as-is, without the sorts of refinements and adjustments necessary to make it into something as useful and precise as a keyboard or mouse (or even an X-Box controller).

I'm no expert on this subject, not by any means. I'm not even remotely attached to the field; I probably have more knowledge about nuclear engineering than I do about this particular field of biology, and I know fuck-all about nuclear engineering. I don't know what all the actual complications and problems are with the development of good neural interfaces, but I do know that if it were just a matter of spending a few billion more, it'd already be done, because there are trillions to be made here and the sooner one corporation does so the sooner they can get a lock on it and the less competition they have to face, and the less chance there is that they'll get beaten to the punch. This isn't something that just applies to severe ALS cases, this is something that everyone will want as soon as it actually really works well; making a good neural interface, and then making it affordable and mass-producible, isn't necessarily the top priority in any hardware or biotech firm's to-do list so far as I know, but it's nowhere near the bottom.

Feedback is a problem. A lot of motor function and other brain functions work off of afferent and efferent feedback loops; if you can't feel your legs, even if every nerve sending a signal TO the legs still works, then you can't coordinate them, can't walk, and all of that. Smiling makes you measurably happier, because your brain doesn't know what's going on until it checks with your face (this is a profound oversimplification). I can type with my eyes closed while not looking at the screen in the dark on a keyboard without any bumps on the home row, but I can do that because I can still feel my fingers and the keys; without that feedback right now, I would be unable to type, even though I've already learned how to type and been doing it for years and years and my eyes are open in broad daylight with a screen right in front of me. Learning how to type for the very first time without tactile feedback would be really really difficult, and it would become impossible to do it in the dark and without a visible screen. So actually using a neural interface requires that you have some immediate feedback and train your brain to use it properly. Visual and aural feedback are all you'll have to go on, so it's like typing in the dark without any feeling in your fingers, with just the screen to look at. It's possible to overcome this problem, it's just a matter of training and conditioning, but the problem is still there and still adds to the other problems inherent in direct brain interfaces.

Adjusting a brainwave-reader for the individual's brainwaves might be another problem, but, I'm probably just exposing my ignorance by saying that.

There are also the problems Arioch mentioned with wired-in neural interfaces for artificial limbs a few threads back; yes, there are people who can coordinate current artificial limb systems and such perfectly, but there are also blind humans who can navigate by echolocation; if I or most other people were to go blind we would not join that number.

Beyond that, I really have no knowledge of what sorts of problems there are that hold development back. But, again, since neuroscience isn't the easiest thing in the world, I'd bet there's a lot of them, many of which are probably a lot bigger and a lot more difficult than you or I are prepared to even understand.

Again, lack of funding is always a problem in every field of research. More resources, more money, more eyes and brains on the problem, ALWAYS preferable. But lack of corporate interest isn't the biggest problem here; at least, not nearly as much as it is in, say, autoimmune diseases or cancer research or any of the other trillion-dollar medical research industries. Because you can't package a cure for cancer with every iPhone, you can't make a Lupus treatment that sells to every kid who wants to play Unreal Tournament, and you can't perfect a post-organ-transplant therapy drug that can be sold as a professional specialty item to wealthy studios in the burgeoning 3d animation field. You can with a decent surgery-free neural interface, all while also developing more advanced and expensive (probably surgery-using) related items to sell to people with more advanced needs.

As soon as you get a decent-quality neural interface to play Halo with, you'll have all sorts of people regaining their mobility with the aid of technology, at some fairly affordable prices because the cheaper a good neural interface can be made the more iPad users and X-Box players will buy them and the more profit the patent-holders will make.

But brains aren't really easy or simple matters, guys. You're all making it sound like it's someone's fault that hard things take time.
Every computer company in the 1980s would have loved to have been able to make the sort of laptop I'm writing this post on right now, but it took another thirty years for the technology to actually advance to this level despite all the money and effort and thought that was getting poured into such developments and despite pretty much all of the involved theoretical sciences having actually been nailed down by that point. We can't really say that here.

Biologists and biotech companies, people in the field, they're doing the best that they can, and the men with the really big bank accounts see quite a bit of profit to be had in this particular field. There are a LOT of important branches of biology where they don't, places that are actually genuinely neglected and where al the issues with funding and corporate interest are actually relevant, but here? Not so much.

ThatsNoMoon wrote:
...then you bring in patents and it all goes to hell. Don't even look into patents on biology; you'll only make yourself sick with disgust.
This is a truth that has driven better men than I to drink. And it's such a severe problem that it's really very likely holding bigger things than neural interface development back by quite a bit. The problems with patents in other hardware related industries only add to this in this specific case.

But patent and copyright issues, to my knowledge, only become really severe when people realize that there's a lot of money at stake, and when a number of developments have actually been made.
I'm not saying that the system isn't at fault here, but if it's capitalism's fault, it's probably due to overinvestment and information control for the purposes of profit in what promises to be a very important field, rather than underfunding and lack of interest.


Thu Aug 11, 2011 4:03 pm
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Post Re: Couple questions
Arioch wrote:
Rich people don't get to decide how their tax money is spent; government agencies and elected officials do. Please assign blame appropriately if you don't like how the government spends tax money.
True, though there are some very wealthy segments of society who have influenced policy and politics. I was only quipping at the no tax lobby/their very well endowed backers and making a utilitarian argument why such individuals might support cutting education funding, NSF grants (these are being cut back again, and thus Federal funding for medical research. Man it sucks to be a grad student. :roll: ) and such.

Quote:
To put the concept of trickle-down simply, the rich keep getting richer and the masses ride their coattails into prosperity, and I happen to agree that this seems to be the case. Even further, I'm sure the modern phenomenon of corporate backing has always been in force, just not to this scale or lack of regulation (IIRC, older corporations and trusts were practically existing at the whim of the public and had a [very] limited lifespan and an equally short leash). To refine the analogy above, the rich keep getting richer, the masses keep riding their coat tails, and the shrewd in both camps keep trying to bash the other's brains out for a personal benefit outside of the group.


Funny, I always thought it was the millions of laborers and workers who produce the overwhelming wealth of society with a small minority always attempting to extract a greater proportion of product than their productivity and input contributions merit. (Average U.S. labor productivity and average wage have been diverging since 1974 ;) )

(Also Cy83r, you shouldn't draw conclusions from a chart that does not specify whether changes in net worth are nominal or real dollars. This graph might be better, http://en.wikipedia.org/wiki/File:MeanNetWorth2007.png, though nevertheless the measure you use is confounded by the housing bubble which is the majority of lower income household's share of net-worth. Income is a better measure improvements in economic well being than net-worth.)

Quote:
I'm not saying that the system isn't at fault here, but if it's capitalism's fault, it's probably due to overinvestment and information control for the purposes of profit in what promises to be a very important field, rather than underfunding and lack of interest.
Solemn, perhaps the problem is that the economic system is sliding from capitalism back towards mercantilism...

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Thu Aug 11, 2011 4:11 pm
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Post Re: Couple questions
Quote:
millions of laborers and workers who produce

In an increasingly mechanized industry, people are becoming defunct and the business owner have accrued quite a bit of leverage against menial laborers when investing in robots, while specialised labor with high overhead, looks like it beats the tar out of the human worker.

Quote:
attempting to extract a greater proportion of product than their productivity and input contributions merit

You mean to say "they're cheating and stealing", right?

Quote:
does not specify whether changes in net worth are nominal or real dollars

I should stop talking because I don't even know what that means. :?
Since when have dollars been real?


Thu Aug 11, 2011 7:12 pm
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Post Re: Couple questions
Cy83r wrote:
Quote:
millions of laborers and workers who produce

In an increasingly mechanized industry, people are becoming defunct and the business owner have accrued quite a bit of leverage against menial laborers when investing in robots, while specialised labor with high overhead, looks like it beats the tar out of the human worker.
Quote:
attempting to extract a greater proportion of product than their productivity and input contributions merit

You mean to say "they're cheating and stealing", right?


Time to pull out the law of averages :lol: I was merely attempting to describe a phenomenon in empirical terms which have statistical support. You are attempting to suggest that such a claim is equivalent to a normative assertion which moralizes actions of individuals and attributes causation (though supposing compensation should equal value created for one's labor is also a normative assertion which if violated has interesting consequences :P ).

Here is some peer reviewed data/government sources:
Image
Image
Image

I can only think of two explanations of this divergence from the average value of worker output from the average compensation. The first one I prefer because it is just funny and wonky (not because it is a correct explanation).
Explanation A). Wages and productivity have diverged because the most productive workers are very inadequately compensated while the vast majority of workers' compensation is more than the value of their product. Though from a microeconomic perspective there should be no reason this situation exists: why would McDonald's hire someone whose work does not make the franchise a net profit (i.e.: wages > marginal revenue)/ and from a macroeconomic perspective : why is there no inflation/ why are inventories so high and consumption so low?
Explanation B). A large proportion of workers are not being paid according to the value of their output and that excess value is being
allocated to parties whose productivity is far below their compensation. Such a scenario would explain why consumer demand is so low and can be explained in microeconomic models as "economic profit" (ie: profit beyond costs). Furthermore, this explanation corroborates with the fact that 80% of U.S. workers earn less now than they did in 1982. (Source is midway down http://sociology.ucsc.edu/whorulesameri ... ealth.html). I can also explain how/why these phenomena are undermining capitalism and why supply side (trickle down) economics is just a rationalization of the rentier class for their disproportionate (/unstable) share of society's wealth.

*Normative generalization* History has show that economic systems have been set up in such a way that minorities who do not produce gain a disproportionate share of society's resources.


Quote:
Quote:
does not specify whether changes in net worth are nominal or real dollars

I should stop talking because I don't even know what that means. :?
Since when have dollars been real?

Apologies for applying the jargon of my discipline, but that is a correct assertion if you are unfamiliar with economics. The difference between real and nominal is that the first is adjusted for inflation. For example, if you looked at average wages today vs the average wages in 1972 without accounting for inflation you would see that wages today would be greater than in 1972. If you weight the dollar to a value in a specific year, let's say 1972, and showed current wages in terms of the value of 1972 dollars (which are worth more than 2011 dollars due to inflation) this would be called "real dollar" value of wages. (Cy83r, I can also answer your epistemological questions about "real dollars" if you wish, though the results would be whacky and enough to tick off any hard realist :D ).

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Thu Aug 11, 2011 10:11 pm
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Post Re: Couple questions
Humor: makes it easier for people to swallow the fact that they know nothing on the subject.

Quote:
^All of the Above Post^

Okay, so they are cheating and stealing, but under the established rules of the system.

Has anyone ever successfully argued the case of "an unjust law is no law at all" against faulty policies (or at least 'policies with a high value of evidence towards their being in fault') still in force?


Sat Aug 13, 2011 2:18 pm
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Post Re: Couple questions
hi hi

I think there is a lot of problems with the somewhat prevalent notion that people get what they deserve. (A cognitive defense against the chaos of a largely uncontrollable world.) People have no tolerance for some poor guy who mugs someone for their loose change, but when someone says "You do what I say or you'll be ruined financially, your kids will go hungry and uneducated, you'll lose your house and the respect of society," that is -for some reason- not as clear cut.

Trickle down is one of those things that seems to make sense, but is empirically false. Kind of like the idea that heavier objects fall faster. One thing that does prompt investment is when demand grows beyond a company's ability to supply.


Sun Aug 14, 2011 12:13 pm
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Post Re: Couple questions
So, independent of pretty hypotheses, how the hell does economics work?


Sun Aug 14, 2011 2:25 pm
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Post Re: Couple questions
Economics works similarly to many other academic disciplines. Find a problem or phenomenon -> Reason out an explanation -> Gather data to support model or theory. (The discipline itself fixates heavily on deductive reasoning, which has its own implications).

Though, Cy83r probably meant "how does an economy work?" in his query. Simply put, an economy works because all human agents have needs/wants. Human agents exchange goods/services as a means of satiating needs/wants. It is this collective action, its results, and its organization which leads to a working economy. I can give a more complex explanation if desired, but this is the most general explanation I can give on such a broad question.

Here is some good commentary which sums up what I thought when I read Wealth of Nations and relates to your question.
http://rortybomb.wordpress.com/2011/08/08/guest-post-what-would-adam-smith-think-of-the-idea-of-job-creators/


Furthermore:
Cy83r wrote:
Okay, so they are cheating and stealing, but under the established rules of the system.
Again let me reiterate the difference between normative and empirical statements. "Cheating and stealing" are moral claims projecting a value judgment onto actors and asserts a certainty about the causal nature of events. Stating that there has been a vast redistribution of wealth in the U.S. and positing a possible link to the divergence between average wages and average productivity is empirical because it is derived from data and facts. It is impossible to know the actions/motivations of every individual within a large population so making moral generalization about all the members cannot be based in fact. Thus, the two positions are not equivalent.

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Sun Aug 14, 2011 4:23 pm
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Post Re: Couple questions
Arioch wrote:
...like splicing LISP code into a C program...
Gag! Ack! Thank a great and wonderful God for compile-time error traps. And blame Satan himself for Lisp.

I wonder if it is possible that the Loroi would treat the actual calligraphy of the written word as a means of expressing subtlety and nuance just as meaningful as the choice of words themselves? Arioch insists that the Loroi are an intensely visual people; does this dependence on imagery translate to the written form?

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Sun Aug 14, 2011 5:08 pm
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Post Re: Couple questions
Cheating and stealing, both infractions on social privileges [to a modicum of fairness] and claims [to property], are as much moral claims as lying is the opposite of telling the truth, which is to say the actions are only morally charged if you view them as such (which I do and do not).


Tue Aug 16, 2011 6:33 am
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Post Re: Couple questions
Time for a question from an RP thread!

sunphoenix wrote:
Now...{ahem}, some... uncomfortable... or at least 'sensitive' questions...

Image

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...What, pray-tell, did Beryl mean by... "It is... Necessary for them. For their physical and mental Well-being..."? Is she actually referring to a racial gender-based medical 'need' or is this an example of 'Reverse-Chauvinism'? [ie. "A woman's not a woman, until she has a man in her bed..."] in this case a male needs "taking care of" so he must service women on some regular basis... yadda yadda yadda... {insert stereo-typical phrase of choice.}


It is kinda weird. I'm willing to bet though that it's an actual physical need, specifically that the males develop a chemical addiction to the Loroi equivalent of dopamine. I can't think of any mechanical reasons why a lack of sex would cause problems, and if were just a very strong instinctive urge, it shouldn't cause any problems beyond frustration/aggravation.

Anyways though, is there any Word of God on the issue? I did a search through the Insider and it doesn't touch the subject of male sexuality.

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Sat Sep 03, 2011 10:58 am
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Post Re: Couple questions
Beryl's assertion is slightly exaggerated, reflecting the imperative in Loroi culture to protect males and provide them with whatever they might need (or just want). However, it is true that the sex drive is a powerful force for the Loroi male, and a male deprived of opportunities to mate for an extended period may begin to show signs of psychological and even physical distress.

The Loroi male is like a stag permanently in rut, charged with hormones and reproductive fluids; if he can't find an outlet, there is the danger of overloads that may unbalance his system. There are built-in "safety valves" against fluid buildup (if you've ever seen video of a bull elephant in rut, that will give you some idea), and seeing a leaky male will generally send nearby females into a panic to resolve the situation ("get that boy some tail, STAT!").

If the situation continues, a male may begin to suffer from dehydration, malnutrition, hormone imbalance, depression, mania, or self-destructive behaviors. This rarely happens, as it is very unusual for a male to be in a situation in which there aren't any nearby females.

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Post Re: Couple questions
Arioch wrote:
and seeing a leaky male will generally send nearby females into a panic to resolve the situation ("get that boy some tail, STAT!").


I can imagine the embarrassement if alex have a "nocturnal emission"


*wake up*
how shit...
*take the sheet to wash them*
*horde of loroi rush at him*
*run away in fear*
AM SORRY! I DIDNT WANT TO GET THEM DIRTY! DONT KILL MEEEEEE!!!!


Last edited by Karst45 on Mon Sep 05, 2011 3:04 pm, edited 1 time in total.



Sat Sep 03, 2011 12:44 pm
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Post Re: Couple questions
Arioch wrote:
The Loroi male is like a stag permanently in rut, charged with hormones and reproductive fluids; if he can't find an outlet, there is the danger of overloads that may unbalance his system. There are built-in "safety valves" against fluid buildup (if you've ever seen video of a bull elephant in rut, that will give you some idea), and seeing a leaky male will generally send nearby females into a panic to resolve the situation ("get that boy some tail, STAT!").

If the situation continues, a male may begin to suffer from dehydration, malnutrition, hormone imbalance, depression, mania, or self-destructive behaviors. This rarely happens, as it is very unusual for a male to be in a situation in which there aren't any nearby females.

Is there some sort of biological feature which prevents onanism from solving that problem (so, say, human females would thus likewise be unable to provide... treatment) or is it just some sort of cultural taboo against self-indulgence?


Sat Sep 03, 2011 12:49 pm
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Post Re: Couple questions
...God I love this forum.

EDIT: WAIT. We all thought humans would help the Loroi by being their "love-bunnies", as it were, but that's not the case...
Humanity is going to teach the Loroi the joys of masturbation!

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Sat Sep 03, 2011 2:11 pm
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Post Re: Couple questions
Count Casimir wrote:
...God I love this forum.

EDIT: WAIT. We all thought humans would help the Loroi by being their "love-bunnies", as it were, but that's not the case...
Humanity is going to teach the Loroi the joys of masturbation!

They´ll nuke us for this...

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Sat Sep 03, 2011 2:14 pm
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Post Re: Couple questions
Solemn wrote:
Is there some sort of biological feature which prevents onanism from solving that problem

Never heard that particular term used before... had to look it up. Every day is a learning experience!

There's nothing to prevent that kind of outlet, but as you can probably imagine, it's not a typical practice. When there's a line of females waiting outside your door...

Sex deprivation would be an unusual circumstance for a Loroi male, and would most often occur when something was wrong with him to begin with... such as poor health, having a communicable disease, or suffering from emotional or psychological problems ("I'm on a sex strike!").

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Post Re: Couple questions
Count Casimir wrote:
...God I love this forum.

EDIT: WAIT. We all thought humans would help the Loroi by being their "love-bunnies", as it were, but that's not the case...
Humanity is going to teach the Loroi the joys of masturbation!


That or artificial insemination. 1 male could then fertilize 100 of females

Arioch wrote:
Sex deprivation would be an unusual circumstance for a Loroi male, and would most often occur when something was wrong with him to begin with... such as poor health, having a communicable disease, or suffering from emotional or psychological problems ("I'm on a sex strike!").


Image


Sat Sep 03, 2011 7:05 pm
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Post Re: Couple questions
oh, and here i was thinking that a "the man, the myth" t-shirt was bad

nice find Karst45

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Sat Sep 03, 2011 9:46 pm
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Post Re: Couple questions
Arioch wrote:
...
When there's a line of females waiting outside your door...

Hoo boy, now we´re in Geeksexland already...

Image


:mrgreen:

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Post Re: Couple questions
Cy83r wrote:
Wiki says wrote:
In addition, wealth is unevenly distributed, with the wealthiest 25% of US households owning 87% of the wealth in the United States, which was $54.2 trillion in 2009. (citations removed)

To put the concept of trickle-down simply, the rich keep getting richer and the masses ride their coattails into prosperity, and I happen to agree that this seems to be the case.


In the past certainly, but today American businesses are squatting on the better part of two trillion dollars, and not doing a damned thing with it.

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I can only think of two explanations of this divergence from the average value of worker output from the average compensation. The first one I prefer because it is just funny and wonky (not because it is a correct explanation).

Wages are determined by supply and demand like many other things, and in this case it is the supply of labor that has shot way up in the past half century.


Sun Sep 04, 2011 7:42 pm
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Post Re: Couple questions
Nathan_ wrote:
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I can only think of two explanations of this divergence from the average value of worker output from the average compensation. The first one I prefer because it is just funny and wonky (not because it is a correct explanation).

Wages are determined by supply and demand like many other things, and in this case it is the supply of labor that has shot way up in the past half century.


:lol: This type of analysis makes me chuckle as a grad student, so many fundamental problems/disequilibria in labor markets that simple supply and demand model cannot explain. Just FYI, Econ 101 and classical models are not how an economy actually operates ;) , just oversimplified abstractions. Wages should reflect productivity in a market clearing model, since the employer is paying the worker what his or her labor is worth in terms of output, and according to theory, a laborer will only accept a wage for what their labor is worth (this assumption dictates labor supply in the classical model but it is empirically false due to imperfect information, monopsony power, employer vs labor rights, and the fact that laboring is not necessarily a voluntary action). Just read Adam Smith, Wealth of Nations passages Book I Ch VIII, 11-16 if you wish for an authoritative explanation of why a simple supply and demand model does not exist/explain labor markets accurately.

Furthermore, the increased supply labor has been absorbed by an increase in the size of the economy/demand for labor (though over the past 10 years something like 50,000 net U.S. jobs have been created while the workforce grew by 3 million but that is only if my memory recalls the literature I was reading the other day accurately, so there is a "reserve army of the unemployed" pushing down wages slowly).

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Sun Sep 04, 2011 8:36 pm
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