Basic Economics or Erepublinomics Vol. 1

Day 683, 16:14 • Published in USA Romania • by Donovanator

Economic fulfillment through government activity has always seemed to be everyone's quest especially when the become part of the government.

After 5 months I finally believe I have it all figured out.

Erepublik is very simple but yet sense every thing is nearly capitalistic it can't be controlled, and since taxes used to be the oldest topic - I think I will tackle that topic first.


Income Taxes

The income tax rate should be kept at 20%.

The reason why I suddenly started to believe this is because of the Laffer Curve (I suggest you click on the link and read about it)

Income tax is also very easy to measure: Just check how many citizens we have, then minus it by whatever the unemployment rate is , and finally times it by the average salary.

Income Taxes shouldn't be used to control how your market works.

I direct this to all the people who believe that we should use taxes to prevent people from working in a certain market remember in a capitalistic environment, markets can adapt to the way products are flowing but you shouldn't prevent it from adapting by adding more taxes or adding selective taxes, and if it employs somebody you shouldn't complain.

Also all income taxes should be equal between products this also refers back to the paragraph above.

Import Taxes
All import taxes should be kept at 99%. Except for the resources we don't have then they should be kept at 0% or atleast very low.

Of course everyone is going to shout "Our prices will go up!" . Well that is nothing to worry about.

You see the higher the prices go up, the higher salaries go up, and because the gold rate is constant (and should be kept constant) gold revenue goes up for employees and thus the government- creating international wealth, which is something to be focused on since there is no such thing as being isolated in this game.

Imports (now no longer on the topic of taxes but we will get back)

Imports cause the lowering of not only products but also salaries which ,in a land that is attached to gold, lowers your wealth globally.

Of course this isn't true when the only thing being imported is a product which one's country cannot supply (like iron in the eSA) and that should also be the only thing imported.

Manufacturing Products should never be imported for all they have done is replaced an American made product and because this isn't RL - imports on the Manufacturing Level doesn't help any American other than the consumer but of course he is technically weakening himself for he is weakening his economy.
Value Added Tax
This is something that is very hard to understand, calculate, and measure.

You see VAT (value added tax) taxes the consumer and slows him from spending his money. That causes a downfall in sales and causes prices to be still relatively high while salaries stay the same- which isn't economically natural.

They should be kept low or not at all, and should be spent separate from the way income tax funds are.



A Dollar's Gold Value

Cheap Gold is the way to go.
If our gold prices were very low while (because of imports) salaries were high then we would have a time of great expansion and plus because of salaries going up in terms of gold - tax revenue would go up causing the eSA to gain global financial power.

A strong dollar in the monetary market (meaning gold is cheap) should go "specially with the print-sell-return method of income the Congressional Budget Office has been conducting"

Exports
Exports are good and cause our GDP to grow but this is only true when it is economically and naturally caused.

If the government were to lower our gold value just so that way our exports would increase- our wealth would decrease due to the fact that our dollar is weak and our government wouldn't be able to afford the gold to declare war, peace, buy hospitals, and etc.

Plus it would be harder for people to afford things that are in gold like making a newspaper, company, and etc.

Of course financial aid wouldn't be hard for people that already have companies, but promoting such a thing is practically anti-capitalist and remember capitalism in all forms seems to haven't failed yet.

Infrastructure
If everything that is above has been applied to our economic system. Then the only thing we should focus on funding is infrastructure/ hospitals and defense systems.

Before the war we didn't focus on infrastructure but the main focus was on buying short term guns.

Defense Systems should be a main focus in funding. The economy seemed to be able to back itself during the war but we probably would've been able to defend ourselves better if we had more defense systems.

Defense Systems build up "the wall" higher when people live in the region of which it belongs thus it should be given a hospital which people flourish to during wars.
But the first q5 defense systems shouldn't be just given to our border regions but also our biggest economic regions- so that way we (I don't really want to say it but I will) protect our assets.

Meals on Wheels
This isn't much of a funding activity but more of a mentoring program. This is cheap and guides all new players on how to live.

Now this is all I have to say today but I might write more later.

War Games

War games are great for preparing for war and increase the production of guns which is very good.

The only down side is that people start to start buying only q1 food instead of other types but I assume that those high quality workers can start working for a gun company.

I support wargames to prepare us for the inevitable, and many other reason which other people have written about before.
The End for Vol. 1 (which might be all that is written)

"Organization that are seeking into growing into different industries should grow into the food industry last. Food shouldn't be there for profit but instead to provide your other employees with cheap food."- Guidelines for Company owners - A newspaper article that might come soon if this one gets plenty of votes.