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It amazes me that Republicans pretend that middle-class wealth wasn't destroyed by the raiding of pension funds and loading healthy companies with debt forcing them into bankruptcy. See again the article I posted about Bain Capital, and then multiply that by the other finance companies doing the same thing - and yes, no guns pulled, and a scant few (e.g. the unrepentent Andy Fastow) sent to prison.Quote:
Originally Posted by Gregg
At a certain level of wealth inequality can you even have a healthy society? Well look certainly you can't when short sighted wealth captures the political system (cough, cough, that would be now). But also if you become a banana republic with a few rich people and many many poor. Um what is the status of civil liberties of the democratic process etc. etc. in THOSE countries? At a certain point you are dictatorial just to keep the masses from revolting. Ever been countries with civil liberties, in which the democratic process actually worked with this level of wealth inequality? Probably not because at a certain level of wealth inequality the democratic process will likely decide to redistritube some wealth :). But if not that, you do have to keep down revolution.Quote:
If anyone knows of an example in history where a society was rejuvenated through forceful capture of the assets of the wealthy and a subsequent redistribution to the 'lower classes' please let us know. I don't believe there are any. The attempt ultimately fails every single time. Or the society does.
Maybe, maybe not. Are BPs profits taken out of the pockets of the middle class. Well it is not a middle class thing, they have taken from us all. It is wealth creation in private pockets through destruction of the commons (which btw is SO MUCH that is wrong with modern captialism, much of what the harshest critics critique, the destruction of the world by the economic system is precisely this). What about agribusiness profits from conventional farming? Same thing. We all know about bankster profits, clearly they have got us coming and going. They pocket profits in the boom and then when those profits prove to have been acheived through deception, pocket bailouts in the bust (not just their bailouts were illegitimate the boom profits also were really, although at least letting them go broke or be nationalized ...). Many of our big businesses seem quite corrupt not to mention the FIRE economy. Most mid-size businesses are rather mundane (they aren't necessarily destroying the planet wholesale or engaged in chicanery). Although I will say outright that anecdotally every business I've ever worked in when it reached a certain size had quite a decent part of it's sales coming from government for what it's worth (and I don't consider that by itself immoral or anything. Some were probably prompted to do so in self-defense from the government - yea I'm speaking of actual historical timelines of businesses I have known here. I'm just showing how business and government are all wrapped up in each other even when it's not corrupt - when it's corrupt, oh boy!). But yea many businesses mundane. Great innovators are the exeception. A google or something more the exception than not and maybe pure ephimerialization (Bucky Fuller), money created through idea generation, something existing where it didn't before. When you start dealing with the pure physical world though, more for some can become less for others, it's a finite planet, that's that capture of the commons stuff.Quote:
It absolutely amazes me that the entire Democratic position appears to be based on the "fact" that wealth is a zero sum game. It's not. Wealth CAN be created. Do the top few percent control a big share of the pie? Yes, obviously they do. Did they get it by taking it out of the pockets of the middle class. No.
That is a disasterous way to help the middle class. I mean really the housing bubble - disasterous. That such policies are actively pursued and they were, whether or not they are to give money to the middle class (may have been as much for the banksters as anyone but it did create a middle class wealth ILLUSION) is just ugh. What the middle class needed was real wage increases. Housing is both an asset and an expense for the middle class and some kind of shelter is a *necessary* expense too. Let that sink in, who really wants their expenses to increase? Do we go around saying we want higher food prices etc.? (well some of us do because we want externalities fullly internalized, but it's not a popular position). Expense increases in such a case can accomplish good, but expense increases are not BY THEMSELVES a good. So middle class person buying their first house, with housing prices increased will pay far more for it in terms of downpayment (ha downpayments what a quaint old-fashioned notion - but if he has a downpayment it won't go as far!), in terms of monthly nut, in terms of taxes (property taxes based on property value), and especially in terms of interest owed over the life of the loan (for two reasons, downpayment covering less of the loan and higher cost meaning more money lent)! So who is really getting rich here? The homeowner or the banks? Hmm ..... Now there is a way to win a housing bubble, get in while it's cheap, sell out at the peak etc.. But that doesn't mean the majority wins from housing bubbles. In fact housing bubbles actually *ARE* true ZERO SUM wealth. Higher housing prices also increases rents for those who seem at first glance outside the game entirely (the renters). So no, you want to help the middle class: increase wages, not housing prices (the last decade is testament to that). How? Not so easy, but pro-worker policies could probably help.Quote:
If you want to effect some good for the middle class through policy it needs to be in a way that will cause the assets held by that class to increase in value. Housing, for example. That's where the middle class holds their wealth and it is a declining value asset. As long as that is the case we can not reverse the course, except at gunpoint, of course.
Unless you just fell off the turnip truck or make buggy whips for a living none of this should be an issue. There are no guarantees of success, moving assets to their highest and best use adds value, and no matter how much you wish the world revolved around you it doesn't.Quote:
Originally Posted by Lainey
"A certain level" is a little to broad a concept to address, but unless you wish to return to a purely tribal existence inequality of wealth within society is a given. Even in a tribal situation someone is the keeper of the fire and that asset could be leveraged. Guess we have to go back farther than that...Quote:
Originally Posted by ApatheticNoMore
No, they are not. BP, et al, certainly make profits because the middle class and everyone else buys their product, but it is because you give money to them (of your own free will, no less), not because they take it from you. If you want to change anything, don't buy what they're selling. You have the option. Would life be less convenient without your car and the gas that runs it? You bet. That's why we all keep buying from the BPs of the world, but you need to remember, it ain't Momma's milk their selling, it is purely a choice made out of convenience. You won't die without it, no matter how dramatic some folks try to make it sound, any more than you would die without a washing machine or a 60 second microwave meal for lunch. We've been on the treadmill before, but the simple truth is that if enough consumers stopped buying what they sell they would either change products or go out of business.Quote:
Originally Posted by ApatheticNoMore
A bubble can be disastrous, but I'm not talking about a bubble. A bubble is a short cycle of unsustainable inflation. A long cycle of steady inflation is not a bubble, it's appreciation. Outcomes on either end of the economic spectrum will hurt most participants in an economy. A bubble because most will not recognize it as such and so will not get out before it bursts or, as was so common in the housing market, they will try to get in by speculating when the only remaining profit avenues are cannibalistic. On the other end, deflation or stagnation also hurt most people with modest assets because the things that are typically held as their largest assets are not increasing in value or are even declining. We are in a stagnant economic period right now and, in the case of housing, there are still pockets of deflation. Until that is corrected the middle class will continue to lose ground. The Buffett Rule will do nothing to change that.Quote:
Originally Posted by ApatheticNoMore
So, putting $8m down on a company, paying yourself over 4 times that amount in the first year and then driving a company that was highly productive into bankruptcy because you saddled it with astronomical debt is your idea of moving assets to their highest and best use? Interesting viewpoint.Quote:
Originally Posted by East River Guide
What may be more interesting is the fact that the left is constantly bringing up the KB Toys / Bain Capital deal as a way to slander the Republican front runner. I'm assuming that is the deal you had in mind jp1 since it is the only Bain deal that anyone ever brings up. Political mudslinging is the only apparent goal. What fails to get mentioned is that Mitt Romney left Bain years before that deal and not long after he left he placed his assets in a blind trust. That means that he would not have known if his positions had been divested or not and certainly would not have had knowledge of the company's dealings from the inside.
I won't attempt to defend Bain because I have no way of knowing what the intentions of the principals were at the time. I do know they also owned a large stake in a KB competitor, Toys R Us, and that by closing one company the competitor was made stronger, the jobs there more secure, the stock price (and corresponding value of employee retirement funds) was raised, etc. Did the loss on one hand balance out with the gain on the other? I'm not sure, maybe. What I do know is that there are at least two sides to every story and that the truth almost always lies somewhere in the middle. And yes, it is quite possible that taking all the assets out of KB Toys and putting them into Toys R Us or some other portfolio company was the highest and best use of that asset by Bain Capital given the growing competition from internet sellers and the trends away from sticks and bricks locations.
I don't believe that instead of public policy to shift off fossil fuels we should all just stop buying gas. That's ridiculous. And by the way it's not even EFFECTIVE, if some people stop buying gas other people will just make up the shortfall.
Geez, even when I think the system needs to be defunded (and I do, as too much of value is being destroyed), I don't think "why not buying gas, that's the answer", because again someone will just end up using it.
And the beat goes on.Quote:
Originally Posted by ApatheticNoMore
Remember the Golden Fluffo shortening that Mike Wallace pushed in his early days? Not many do. Guess what, people stopped buying it and look where it is, or rather isn't, now. There wasn't anything so glamorous as a boycott, it was just a matter of more and more people switching to other products until Proctor & Gamble (who made it) finally decided to shut it down and make something else. Capitalism at work.
And you expect that to happen for petroleum in the global economy?
Maybe when they find something to compete with petroleum - so far they haven't and I don't expect they will.Quote:
Originally Posted by ApatheticNoMore