Bailout Alternative???

[Joel Kaye]

But I would argue that nothing extremely nefarious is going on- it's not like the upper class is artificially abusing their position of power to create such disproportionate distributions of wealth.

That's completely wrong. I don't even want to get into it... but I can promise you the wealthy use their influence to benefit themselves and their corporations.

A little education for you:
Forbes 400. Add up the gains over the last 8 years. Right now the 400 wealthiest American control over a 1.57 trillion in wealth.



http://www.forbes.com/lists/2008/09...s-lists-400list08-cx_mm_dg_0917richintro.html



Look at this article from 2004 when their wealth hit 1 trillion for the first time:

http://www.usatoday.com/money/2004-09-23-forbes-richest-list_x.htm


So that’s a 570 billion dollar gain in 4 years alone. The very rich are getting much richer while the middle class has been getting poorer. And if you don't think they didn't use their influence to buy the media and politicians to drive home the idea of deregulation you're not connecting dots very well.


"In the United States, wealth is highly concentrated in a relatively few hands. As of 2001, the top 1% of households (the upper class) owned 33.4% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 51%, which means that just 20% of the people owned a remarkable 84%, leaving only 16% of the wealth for the bottom 80% (wage and salary workers). In terms of financial wealth, the top 1% of households had an even greater share: 39.7%. Table 1 and Figure 1 present further details drawn from the careful work of economist Edward N. Wolff at New York University (2004)."

http://sociology.ucsc.edu/whorulesamerica/power/wealth.html

Yes. 80% of Americans own 16% of the wealth. I don't buy the idea that 80% of the people are so lazy that they only create 16% of the wealth. If that's capitalism then I'm not a fan.

 

[Clint Johnson]

So it couldn't possibly have anything to do with declining real wages and benefits over the past 40 years, or the regressive tax policies which came in with Reagan, or anti-labor legislation, or failure to enforce the few labor laws still on the books or the general propaganda and policy assault on New Deal policies which has been going on since the 1970s, mounted by big business?

As for your complaints about "regressive" tax policies- the top 1% of the richest people in the US, after all that the best accountants can do, pay 29% of all the income tax collected. The top 5% pay fully half of all income taxes. Then, whenever they buy something with the money they get to keep, they pay billions more into the system through sales tax. The bottom 20% actually get returns in excess of what they pay and their "share" of the income tax is -2%.

For the last half century, the labour movement has demanded wages and benefits that outstrip the increase in productivity by a wide margin. This causes an increased cost of product which has to be passed on and is one of the primary causes of inflation. This makes the North American worker less competitive world wide. The last 50 years, the labour movement has been by far the biggest promoter of job growth in developing countries and more effective in moving jobs out of the country than any loosening of trade relations could ever be.

You're omitting some crucial facts here. There have been huge productivity gains since 1970, and corporate profits are up enormously in the last 40 years. But real wages are still at 1970s levels for most American workers, and in recent years wages have actually been dropping despite continued productivity gains, creating in the U.S. the largest disparity between rich and poor in the industrialized world.

Between 1961 and 2003, labour productivity in North America had an average increase of less than two percent a year. This is to be expected. To go from a hand shovel to a steam shovel would have given something like a 10,000% percent productivity increase where moving from that big old steam shovel to the most modern diesel-electric, computer controlled shovel would give less than a hundredth of that gain.

"Real" wages can't outpace increases in productivity and a lot of the slow increase in productivity has gone into lowering prices and rising standards for those products. Take automobiles for example. The most basic and cheapest car you can buy in 2008 is not as basic and crude as the car of the 70s. The 2008 Toyota Yaris sell for $12,000 which when adjusted for inflation is the same price as the 1979 AMC Pacer.

The hue and cry over a disparity of incomes is a rank display of greed. It doesn't matter what the richest people make compared to the poorest... what matters is that what the poorest make is far higher than it would otherwise be. This envy and greed leads to the poor being shoved into a state of starvation just to drag the rich down with them. Is it a better world if everyone is starving to death equally?

Sure the poverty rate in the US may be 12% compared to only 8% in China... but what we have to keep an eye on is the actual living conditions of those people. The poverty rate in the US is currently at $10,400 per year for an individual while in China the poverty rate is set at $90 per year for an individual. Think about that, 115 Chinese poor can live on the wage of a single "poor" American.

This is a system which doesn't pay off for most Americans, no matter how rich the corporate sector gets. Then again, if by "free market" we mean the richest and most powerful interests in the world are free to write their own rules and structure the system however they want, it's been a great success.

Are we doomed, Clint, to have these arguments, across threads, forever?

The standard of living for everyone in the countries with a freer market is hugely greater than in the socialist and fascist countries. We don't have to sell our children into prostitution to keep them from starving to death and the poor don't die in the ditch unless they wilfully avoid support. Our poverty is an unattainable dream for half the worlds population and I say that is a good pay off.

It does seem that we keep stumbling into each other doesn't it?

 

[Joel Kaye]

Our poverty is an unattainable dream for half the worlds population and I say that is a good pay off.

Because they have slave labor - and we can never compete with that at any price therefore tariffs are the best solution.

If you think a CEO earns his wage in productivity you've totally lost your mind. That money can and should be redistributed back to the rest of the population. Why? Because I think people band together via structured Gov't to SHARE the wealth and resources.

But some people think our country should be more like Texas Hold 'Em. Winner take all. Well that's what we've got. And the deck is stacked.

 

[Matt Gottshalk]

Because they have slave labor - and we can never compete with that at any price therefore tariffs are the best solution.

If you think a CEO earns his wage in productivity you've totally lost your mind. That money can and should be redistributed back to the rest of the population. Why? Because I think people band together via structured Gov't to SHARE the wealth and resources.

Wow, just wow.

This guy agrees with you.

 

[Stephen Williams]

Hi,

So you're saying they have been selling unsound mortgages since 1999, if that was so they would have gone bust long ago.

I know Goldman's reduced their risk to mortgage debts swop's about 10 years ago after loosing over $20 million in day, wiping out the profits from that trading desk for the year.

Bear in mind most of Paulson's wealth (and all the ex partners) comes from the flotation of Goldman Sachs and not salary or bonuses, up till floatation partners were personally liable for all debts incurred.

Stephen

Is that so?

"Angelo R. Mozilo has pocketed $410 million in salary, bonuses and stock-option gains since he became executive chairman of mortgage lender Countrywide Financial in 1999, according to the executive compensation company Equilar.

"Now, the man at the center of the national mortgage crisis stands to collect an additional $112 million in severance when Bank of America buys the company he helped found. "

http://www.washingtonpost.com/wp-dyn/content/article/2008/01/11/AR2008011103673.html

Half a billion isn't bad for driving a company into ruin, even as American CEO pay goes.

Or how about asking Hank Paulson, former CEO of Goldman Sachs, and under whom the subprime business at Goldman Sachs boomed, what his net worth is? Last estimate I saw was well over $700 million.

 

[Joel Kaye]

Wow, just wow.
This guy agrees with you.

Great. A Sarah Palin supporter shows up.

EDIT:

Oops I forgot. Sarah Palin is Marxist too.

The Alaska Consitution requires State resources benefit the residents.

"And Alaska residents are getting their cut. Starting this week, every Alaskan who has lived in the state more than a year will receive $1,200 from the state, a total of about $756 million in rebates to offset high energy costs in the 49th state. That's on top of the perennial check each will receive from the state's oil revenue-endowed Permanent Fund, this year a record $2,069 per resident. The large Palin family is eligible to receive more than $19,000 from the combined payments."

friggin' commies. Probably the Russians infiltrated by walking across the ice when Sarah wasn't looking.

 

[Steven M. Bailey]

There are no easy answers In and economy that is globally affected and locally controlled. I can see the benefit of farming out labor for certain jobs but As I sit here and think about it, it is mostly because of the American attitude toward work that has caused a lot of the outsourcing .

Down the California valley from me is Watsonville, Salinas, Solidad, all in the Santa Cruz mountains. This is some of the most fertile farm land anywhere. Almost all of the farm labor there is immigrant from Mexico. No one I know, (including myself) wants to stand in a field all day picking strawberry's for a wage that keeps the food price artificially low.

Its outsourcing without outgoing. Just like we could not afford American picked strawberry's we also could not afford a fully American made red. It would be better for our economy as it is drawing money in from around the world, but the overall appeal would be lost on the point of price. Therefore making red solely in the US would not benefit anyone really. This is also speculation As I am not sure entirely as to Jim's manufacturing process.

One thing I saw happening here in my hometown was speculation buying of homes. Houses were selling two or three times in a year from one speculator to another. Large corporations sent in teams of lawyers to buy every usable lot of land available. Consumers panicked as the availability of homes became scarce and bought into the first thing that they could afford. A lot of the problem was that there was a very founded belief that if they didn't get into a home now, the market would leave them behind and the never would. I saw people bidding in the lower markets over houses and paying tens of thousands more than the original asking prices.

People who were so desperate to get into their homes, are now not able to keep them. If they had known that it was all a gold rush ploy by speculators they may have waited for the foreclosures to start so that they could pay a reasonable amount for a home. The speculation driven price of homes has exceeded the wages of the average person by so far that a housing crash is eminent and needed. The taxpayers should be bailing themselves out and not the investment company's that caused the problem in the first place. As contractor I saw every one in on the deal. Lumber company's, county permits, steel, roofing, copper, plumbing fixtures, and workman's comp insurance, every thing went through the roof in cost. I wasn't even worth bidding a job out anymore. By the time the housing run was over you you could barely make payroll.

Weather I'm right or not I don't Know as I am too close to the issue, but Middle man speculation on housing should be illegal. The person who built it should be able to ask a fair price for his labor. but the investor with enough money to choke out the market should not be allowed to.

just another 2/5 of a nickel

 

[Clint Johnson]

Because they have slave labor - and we can never compete with that at any price therefore tariffs are the best solution.

If you think a CEO earns his wage in productivity you've totally lost your mind. That money can and should be redistributed back to the rest of the population. Why? Because I think people band together via structured Gov't to SHARE the wealth and resources.

But some people think our country should be more like Texas Hold 'Em. Winner take all. Well that's what we've got. And the deck is stacked.

There is slave labour in the world. In that I mean there are still hundreds of thousands of people bought and held against their will to perform labour. I think that you are confusing harsh working conditions with slave labour. I assure you that there is a very big difference.

The jobs that move overseas tend to be some of the most sought after jobs in those markets because they are almost always better than the alternatives... which often is actual slave labour.

The Smoot-Hawley Tariff Act of 1930 of was opposed by almost every economist at the time and when the other countries retaliated with their own tariffs, US exports were halved. This act of tariffing was the primary cause of a recession becoming the Great Depression. If you want to bring the US economy to its knees, savage the world economy and have tens of thousands of women and children sold as sex slaves... yeah, I suppose tariffs are a good idea.

Without the reward of greater wealth for greater value in contribution, there would be a race to the least work possible. Without the creative work of the people conceiving ideas and building companies around them, there would be nothing for the majority of the population to do other than starve to death. I mean that literally, the contribution of these innovators and creators is the only reason that hundreds of millions of people are able to make a good living rather than a tenth that number scrapping by as serfs to nobility or state.

Bill Gates' contribution to the wellbeing of people in the United States is a million-fold more than any one of the tens of millions of people in the lower rungs of the "working class". There is no fault or blame in this, but if you punish those creators you will always end up with the majority of the population in grinding poverty ruled over by the political class with an iron claw.

Just remember, that without the outlet of business and capitalism, even more power hungry and immoral people will gravitate to politics. While in business, there is hope that the state can keep these people under some control... when they become the state, they regulate themselves and then there is no hope.

 

[Steven M. Bailey]

down with the rich until I become one.:angry03:

 

[Matt Gottshalk]

Great. A Sarah Palin supporter shows up.

EDIT:

Oops I forgot. Sarah Palin is Marxist too.

The Alaska Consitution requires State resources benefit the residents.

"And Alaska residents are getting their cut. Starting this week, every Alaskan who has lived in the state more than a year will receive $1,200 from the state, a total of about $756 million in rebates to offset high energy costs in the 49th state. That's on top of the perennial check each will receive from the state's oil revenue-endowed Permanent Fund, this year a record $2,069 per resident. The large Palin family is eligible to receive more than $19,000 from the combined payments."

friggin' commies. Probably the Russians infiltrated by walking across the ice when Sarah wasn't looking.

Wow if that's your version of a debate then you need to go back to school and learn how to do it right.

Your powers of deductive reasoning leave much to be desired.

Since when is the idea of CAPITALISM a REPUBLICAN or DEMOCRATIC idea?

Incredible.

 

[jpp]

This enthusiasm for crony capitalism, a rigged tax code and corporate welfare is remarkable at a moment when the whole thing is coming apart. Once upon a time, the U.S. economy did provide enormous gains to ordinary people. But those times are over. While residual wealth ensures that no one starves and that even poverty in this country is far beyond the standard of living in third world countries, we're fast moving toward a third world model.

On most objective measures, northern Europeans live far better lives than we do. They're healthier, they have more leisure, they grow taller, their air and water are cleaner, they don't devote vast resources to the military, medical care doesn't bankrupt them and their governments are at least minimally responsive to the national will.

But by all means, keep playing this tune. We're the greatest. This is the best of all possible worlds. The [mythical] free market is the solution to all ills. If you shut your eyes and ears to reality, you can almost convince yourself it's true.

 

[Cameron Preyde]

I think that the $700 billion should be used to outright purchase a number of banks to be merged into a single federally managed bank. Centralization of banking and lending agencies has the potential to hedge the collapse of global economies as well as create medium-long term profit making federalized corporations. The only problems is that centralization of corporations is a little too socialist for the US. Then again...maybe a little socialism is what the US needs right now.

Socialism...root word, Society - meaning, a group of people working together for a common goal.

Capitalism...root word, Capital - in this sense, meaning money, wealth, assets, etc.. Something that very few people have anymore.

 

[Steven M. Bailey]

The government can do almost anything it wants to with all of the social programs in my book as long as it would please abolish all forms of property tax.

government is designed to control regulate and tax interactions between parties, on a global, federal, and local basis. Weather these referee'd interactions are deemed fair or not is always up for debate. But regardless of my venturing out to get money, goods services, etc.etc.etc, being taxed forever and ever and ever on my home and basic shelter is absolutely immoral.

I agree with a flat 18% sales tax on all goods and services. 6% to the feds 6% to the state and 6% to the city/county. This may not work perfect and require some tweeking, but look how good things are working now. This could eliminate the property tax and you might actually get some freedom in your own home.

yet another 2/5 of a nickel:gun:

 

[Joel Kaye]

Wow if that's your version of a debate then you need to go back to school and learn how to do it right.

You're the one who posted a Marx poster... and now you're saying I need to learn to debate? Look in the mirror before you post crap like that. If you want a serious debate don't start by posting a picture of Marx.

 

[Steven M. Bailey]

Can I be:bye2: :ranting2: :gun: on the debate team?

 

[Joel Kaye]

The Smoot-Hawley Tariff Act of 1930 of was opposed by almost every economist at the time and when the other countries retaliated with their own tariffs, US exports were halved. This act of tariffing was the primary cause of a recession becoming the Great Depression.

Untrue. That was a smaller contributing factor after the depression began. And it didn't happen in a vacuum. Wilson had lowered tariffs prior to the 20s. Foreign countries raised their tariffs against us.

The U.S. has a long prior history of using tariffs to protect key industrys.

A much bigger cause was the consolidation of wealth into very few hands combined with the great debt of the average American. Kinda like now.

Causes of the Great Depression
1. False Prosperity
overdependence on mass production, consumer spending, advertising, welfare capitalism, high tariff, "invisible hand"

automobile was the leading industry

chemicals, appliances, radio, aviation, chain stores

overproduction in textiles, farming, autos

real wages increased only 11%

60% population less than $2000 poverty minimum

top 5% earned 33% income - spending by the rich essential

Andrew Mellon cut taxes

2. Speculation
Fed loaned at 3.5%, gold inflow 1927, Great Bull Market 1928

broker loans on call rose from $3.5b in 1927 to $8.5b in 1929

Goldman Sachs investment trusts, 50% margin trading at 5% interest

only 1.5m of 120m population were investors

pooling tactic of "anglers" - John J. Raskob

Charles Mitchell of National City Bank: "I know of nothing fundamentally wrong with the stock market." (Oct. 21, 1929)

Joe Kennedy: "Only a fool holds out for the top dollar" (sold after RKO merger in October 1928)

3. Stock Market Crash
Sep. 3 Dow high of 381

Sep. 6 Babson break - market became erratic

Sep. 20 - collapse of Hatry in Britain

Oct. 23 - J.P. Morgan buys to stop price decline

Oct. 24 - panic selling began - 12.8m shares

Oct. 29 - "Black Tuesday" - 16.4m shares

prices decline to Dow low 41.22 on July 8, 1932

4. Banking Crisis
deposits withdrawn, deflation

9000 banks fail in 1930, 1932 waves

Austria's bank failed May 1931

5. Unemployment
ripple effect as leading factories close

rose to 25-35% of total labor force, 80% in Toledo

farm income declined 60%; 1/3 lost land

6. Trade Collapse
foreign countries retaliate with high tariffs

Weimar Republic unable to pay reparations or U.S. banks loans

U.S. had been creditor with $638m annual surplus

7. Republican Policy
"The Ordeal of Herbert Hoover"
laissez faire, balanced budget, trickle down, voluntarism

no use of monetary or fiscal policies

Agricultural Marketing Act, Hawley-Smoot tariff, RFC of Jesse Jones
Three Little Pigs


"Woodrow Wilson made a drastic lowering of tariff rates a major priority for his presidency. The 1913 Underwood Tariff cut rates, but the coming of World War I in 1914 radically revised trade patterns. Reduced trade and, especially, the new reveues generated by the federal income tax made tariffs much less important. When the Republicans regained power after the war they restored the usual high rates. When the Great Depression hit, international trade shrank drastically. The crisis baffled the GOP, and it unwisely tried its magic one last time in the Smoot-Hawley Tariff Act of 1930. This time it backfired, as Canada, Britain, Germany, France and other industrial countries retaliated with their own tariffs and special, bilateral trade deals."

 

[Radoslav Karapetkov]

Don`t know if you meant my remarks

No, I was talking about the general situation.

 

[michael zaletel]

The amount we do not know about this crisis and the extremely complex economic models so far exceeds the amount we do know that $700 Billion has nearly the same odds of fixing the mess as doing nothing at all. That's not to say we should do nothing at all, just pointing out that the odds of a positive outcome are not increased by action alone.

Oh, and did I mention the economic models are changing every hour of every day. Solving this problem is like trying to hit a target 1 mile away that is moving at high velocity in a completely unpredictable path.

-shooter

 

[Andrew Walker]

I think that the $700 billion should be used to outright purchase a number of banks to be merged into a single federally managed bank. Centralization of banking and lending agencies has the potential to hedge the collapse of global economies as well as create medium-long term profit making federalized corporations. The only problems is that centralization of corporations is a little too socialist for the US. Then again...maybe a little socialism is what the US needs right now.

Socialism...root word, Society - meaning, a group of people working together for a common goal.

Capitalism...root word, Capital - in this sense, meaning money, wealth, assets, etc.. Something that very few people have anymore.

First of all this is what the Federal Reserve wants. Because who do you think the central bank is going to be. Even for the US is going to be the FED...what am I talking about, it is already the central bank. One of the major reasons why we had the American Revolution was to have a free economic society. Not where a bank...or even worst, a group of people controlling the economy.

Second, socialism does not work. Yes I understand the idea of everyone being equal and all that hippy crap. But I'm sorry to break it to everyone that wants to go that way, people are not created equal. Its just a fact of nature that will only go away if we are all just genetic clones of one person. Then everyone would really be born equal. But people are born smarter, dumber, faster, slower, taller, shorter...than the next person. Equality is a joke.

 

[Anthony Gratl]

First of all this is what the Federal Reserve wants. Because who do you think the central bank is going to be. Even for the US is going to be the FED...what am I talking about, it is already the central bank. One of the major reasons why we had the American Revolution was to have a free economic society. Not where a bank...or even worst, a group of people controlling the economy.

exactly. that's why the federal reserve needs to be owned by the people, not by a private company. you currently allow a private company to set economic policy

Second, socialism does not work. Yes I understand the idea of everyone being equal and all that hippy crap. But I'm sorry to break it to everyone that wants to go that way, people are not created equal. Its just a fact of nature that will only go away if we are all just genetic clones of one person. Then everyone would really be born equal. But people are born smarter, dumber, faster, slower, taller, shorter...than the next person. Equality is a joke.

I dunno, that's pretty dogmatic. What kind of socialism do you mean? Textbook socialism defined? Or real life socialism?
Cause if you mean real life, i've got plenty of examples for you mr. drew....and if i was rich, i'd even send you there to see for yourself:meh:

EDIT: btw, socialism doesn't hold that everyone is equal.....but it does seem to equate that those with the most ensure that those with the least are at least at a relatively high standard.....i'm hard pressed to see what's wrong with that.....it makes everyone relatively happier no?