Democrats & Liberals Archives

Smiling Brokers, System Broken, Workers Broke

People say the economy is wrecked - but that’s a gross underestimation of what’s really going on. It’s not just the economy. Or healthcare. Or education. In fact, it’s a greater problem than all of these put together. What’s really at fault is the fundamental system under which we live. Capitalism, in the form that we have developed it in the United States, has failed.

Don't believe me? Explain the dichotomies in this country... tell me, in good conscience, that you think these examples are isolated, or appropriate, or even solvable.

- Goldman Sachs takes $10bn of taxpayer money (and another $12.9 of bailout money from the AIG fund) about a year ago. Now they make record profits, pay back the money (the $10bn, anyway) so that their officers aren't subject to executive salary caps, and immediately allocate record bonuses to their brokers. Somewhere in the region of $600,000 each, on average.

- Meanwhile, Pennsylvania stops paying 69,000 state employees because of a budget impasse, while California stops paying its creditors because it doesn't have any cash at all. Employees in PA are heading to food banks in droves, while CA businesses are failing because they can't cash the IOU's that the banks are refusing to honor.

Is that right? Is it fair? Is it sustainable?

- Health insurance companies 'purge' employer policies that cost more than they reap. Traditionally, insurance was essentially a gamble. The company assesses the risk, bets that its premiums will outweigh its liabilities, and usually wins. On the micro scale it occasionally loses - the guy who loses control and wrecks his car - and on the macro scale it almost always wins - the thousand drivers who never make a claim. But health insurance companies have eliminated that gamble to make sure they win bigger, and bigger, and bigger... by denying pre-existing conditions, by purging employers and their policies, and by cynically, deliberately, making their 'help' systems so arcane that we give up completely and throw down our phones in frustration.

- Half a million Americans this week... this week!! - will run out of unemployment benefits. Many of them will lose their houses, their cars, their furniture. The majority of these are hard-working, honest people who were laid off due to the criminal excesses of greed on Wall St (remember, they're getting record bonuses again!) and who have done nothing wrong except fail to be rich. We are creating a new underclass of unemployed, underemployed people, decimating the middle class in order to pay for the spectacular wealth of the few.

Fair? Acceptable? Sustainable?

I'm not a communist... not even really a socialist. I believe that the capitalist system can work, but only with a societal agreement that nobody should be too rich, and nobody should be too poor. I accept differences in talent, motivation, work ethic, imagination... I just don't accept that Goldman Sachs' 25 year-old brokers are one species, and the 55-year old ex-Chrysler worker who has paid into his company's pension for 35 years only to find it worth less than half what it should be, and whose healthcare has gone, and whose job prospects are virtually nil, and whose unemployment benefits are gone, is another species altogether. But that's how we treat them.

The greed in this country has reached unsustainable and breathtakingly inappropriate levels. We can only restore America if we rein in the corporations, and help those who, through no fault of their own, need help.

The extreme version of communism that mid-20th Century Russia tried to impose on its citizens led to... what? A disgustingly wealthy ruling class that watched uncaringly as the undertrodden majority of the country became poorer, and poorer.

The extreme version of capitalism currently at work in America is leading to... what? Ah. A disgustingly wealthy ruling class that watches uncaringly as the undertrodden majority of the country become poorer and poorer.

Interesting, isn't it?

Posted by Jon Rice at July 18, 2009 12:55 PM
Comments
Comment #284662

We need a system of ethical capitalism where people are paid on merit, not title. And we need to implement some socialist aspects into these areas, such as health care. Like you said, the 25-year old stock broker has no reason to earn obscene millions while the hard-working old timer watches his wife die a slow death because they can’t afford medicine.

People scream the horrors of socialism without ever realizing that we already embrace many aspects of socialism. Police, fire fighters, road work, education, social security. The list goes on. These are all considered aspects of our lives that require socialistic mechanisms to benefit everyone. No one will ever say that police should only answer the 911 calls from people who donated to the police athletic league.

When we talk of cost, fine. That is a critical component, but any reasonable person could not oppose socialistic elements simply on principle alone. I defy someone to refuse even the smallest instance of socialism from their lives and see how great a year they have.

What I find most sad is that conservatives are opposing a public health care simply on cost alone. Sure cost is the biggest factor—of course if we weren’t spending trillions on defunct, wrongful wars…—but why are they not siding with the people who do not have health care? They already look like idiots because they say it is socialism, while offering another choice to the consumer is the very essence of capitalism. One can’t help but wonder if conservatives are so up in arms over a public health care option not because of the cost—really, how can any “conservative” decry any bloated spending?—but because the insurance companies who fund their campaigns have a bad feeling that they will lose customers. Screw those who don’t have insurance and need help, they’re going to make us lose money!!!

Posted by: Mike Falino at July 18, 2009 2:22 PM
Comment #284663

Mike: you said “We need a system of ethical capitalism”.

That’s the exact phrase I should have come up with myself - the perfect expression of a system that could, should, and probably would work.

Sadly, the phrase ‘lack of a moral compass’ has been directed at our corporations for far too long.

Posted by: Jon Rice at July 18, 2009 2:37 PM
Comment #284670

Jon,

I disagree with almost everything you said, except the obvious. America’s economic system is broken.

Problem is eventually some learn to game the system, no matter what the system is.

Goldman Sachs has more or less admitted to this when trying to prosecute a broker that stole their software.

We need a trust buster. However, it’s a delicate balance not to repeat Jackson’s “panics” when he busted up the national bank.

Posted by: gergle at July 18, 2009 4:45 PM
Comment #284672

I don’t think I would pronounce capitalism a complete failure yet, but then I still have a job. My mind is subject to change.

I submit that in fact capitalism has come very close to succeeding, if one honestly defines success as like that of a virus or other parasite microorganism, which is that it has succeeded in turning all resources of its host toward maintaining the life of the microorganism and propagating the microorganism to other hosts. It’s been an abject failure to the host, but a roaring success to the parasite.

The US economy has never been fair or sustainable, since from day one it has depended on the ability of the more powerful to take from the less powerful, starting with the native Americans down to the present-day poor.

But, combining that with the notion that the political system can and should be controlled by the wealthy, and the notion that non-human entities such as corporations can and should be accorded many of the same rights as human beings, has resulted in the slow-motion train wreck that our economy and political system has become.

These decisions were made by what I think most of us would call conservative judges, but which would more correctly be accorded the conservative epithet “activist judges”, if only conservatives weren’t so hypocritical.

Some have mentioned the possibility of an “ethical capitalism”, which I’m sorry to say is almost an oxymoron. The only ethic that intrudes in pure capitalism is that the ethical action is to do that which will make the most money for the capitalist entity, legal or not. To not do anything, legal or not, which would NOT make the most money for the capitalist entity is IMmoral.

Hence though Bernie Madoff will die in prison, he is nonetheless a perfectly ethical capitalist.

Capitalists such as those leading the company I work for, who sponsor diversity and green programs, are on the contrary unethical capitalists according to the perverted morality of capitalism because they are spending money on things that do probably will not pay a return on investment.

And forget about the idea of legislating morality, it never works, as the current round of capaitalistic scofflaws have proved.

I think your last two paragraphs make the point that the US political-economic system is every bit as bad as the Communist political-economic system, it’s just slower.

Posted by: Greg House at July 18, 2009 6:27 PM
Comment #284674

Yep. It’s much worse than some pretend.

The problem it too many decades of too much short-term selfishness, and too little long-term, educated, enlightened self-interest.

These 10 major abuses have been hammering most Americans for decades, and little is being done yet to resolve any of them. In fact, several of the abuses are getting worse.

And not only are most (if not all) incumbent politicians in BOTH parties to blame for it, but so are the majority of voters who repeatedly reward irresponsible, FOR-SALE, incompetent, and corrupt incumbent politicians with 85%-to-90% re-election rates, despite dismal 9%-to-28% approval ratings for Congress.

But, perhaps, when enough voters are deep-into ($11.6 Trillion national debt and $57 Trillion nation-wide debt)debt, jobless (now at 10%), homeless (8,000-to-10,000 foreclosures per day), and hungry (over 10% (32.2 million) of Americans receive food stamps as of 2-APR-2009), then perhaps enough voters will do what that majority of unhappy voters did in years 1029, 1931, and 1933, when they ousted 108, 123, and 206 members of Congress (many in BOTH the Democrat and Republican party).

The question is simply when, and that simply depends on how much pain the voters can tolerate. Look at those 10 abuses that have been perpetuated for decades, and then look at the 85%-to-90% re-election rates for Congress. Is repeatedly rewarding Congress for failure, incompetence, and corruption working?

Not enough partisan loyalists aren’t ready to admit it yet, but many will eventually, when failing to do so finally becomes too painful.

At any rate, the voters have the government that the voters elect, and re-elect, and re-elect, and re-elect , … , at least until that finally becomes too painful.

Posted by: d.a.n at July 18, 2009 7:26 PM
Comment #284675

One of the biggest (of many) problems (one of these 10 major abuses) is the massive debt of beyond nightmare proportions.

No nation has ever borrowed, money-printed, and spent its way to prosperity.

It’s screwing future generations who will go without a LOT to pay for the mistakes and irresponsibility of previous generations.

But, there are a lot of younger voters, and if they join in repeatedly rewarding FOR-SALE, irresponsible, incompetent, and corrupt incumbent politicians with 85%-to-90% re-election rates, they also only have themselves to thank for it.

At any rate, the voters have the government that the voters elect, and re-elect, and re-elect, and re-elect , … , at least until that finally becomes too painful.

Posted by: d.a.n at July 18, 2009 7:41 PM
Comment #284676

It’s not very smart, is it?

At any rate, the voters have the government that the voters elect (and re-elect, and re-elect, and re-elect , … , at least until that finally becomes too painful).

Posted by: d.a.n at July 18, 2009 7:43 PM
Comment #284679

Tell me, Jon. What is it about socialism that you are against or don’t like? If it were offered to be put into place, what would your objections be exactly?

I’m just curious…

Posted by: rhinehold at July 18, 2009 11:19 PM
Comment #284680

Rhinehold:

What I don’t like about socialism is that in its pure form it pretends the differences don’t exist. We are all suited to different ways of contributing to society - some as doctors, some as artists, some as construction workers, and some as volunteers. Pure socialism does not recognize that fact and therefore stifles almost every facet of human endeavor, from technology to art to production.

Furthermore, socialism fails to acknowledge that evolution itself is a meritocracy. Some of us are born with advantages in these various fields and the better we are at our chosen skill, and the more valuable that skill is to society, the better we should be rewarded. The lion who hunts the fattest gazelle the most often procreates more… the doctor who finds a cure for cancer should be worth his or her Nobel million. Under pure socialism, there’s less incentive to be brilliant - or even to find the field in which you may be.

Pure socialism, in fact, doesn’t see much need for art, sport, entertainment… look at how China (no longer a purely socialist state, but emerging from that situation) is only just catching up with the world in many of these areas. Well, except gymnastics, then.

Rhinehold, I don’t hold with pure socialism because it’s communism, and it doesn’t work, it isn’t right, it treats humans as commodities and it’s often totalitarian.

But capitalism, in the unadulterated and unregulated sense, does the same. Really - look at how the healthcare system in our country treats people. As individuals with rights? Or as commodities to be allocated numbers, risk factors, and a reasonable expectation of dying?

Socialism has some inherent value - lots, actually. In a society that expects two-income families, we can’t stay at home and educate our own children - so we need socialized education. Medicine is too advanced and difficult for us to practice it on ourselves - so we need socialized healthcare. When shit happens, as it has done for ten million Americans over the last year, do we just let them suffer, or do we provide some form of socialized welfare?

Without these social programs, we fail as a society. Without the opportunity that capitalism provides, the incentive, the motive, the reward for talent and brains, we fail as a society.

Is it really so hard to accept that the right blend of both is better than what we have now?

Thanks for asking the question; I enjoyed answering it.

Posted by: Jon Rice at July 18, 2009 11:48 PM
Comment #284684

Huh? This is an old meme that Russia is technologically retarded. Sputnik beat us. They have a much more evolved cultural arts arena, and China does as well. Just because it isn’t western oriented doesn’t mean their arts are undeveloped.

I’m not a fan of socialism as an economic system, but your answer doesn’t even touch why.

Socialism doesn’t work practically as an overall economic system because it tends toward plutocracy. So does Mercantilism, which is more descriptive of the US than most like to admit.

Posted by: gergle at July 19, 2009 1:24 AM
Comment #284686

Gergle:

I disagree. I spent time in Russia in 1986/87 and believe me, both technology and the expression of art were significantly behind westernized countries. Don’t get me wrong; the most beautiful collection of art I ever saw was in the Little Hermitage, and to refer as Leningrad - sorry, St Petersburg - as the Venice of the North is no compliment to that spectacular city. But the art was all 200 years old… the Ladas and Trabants on the streets listed ‘back seat’ as a luxury option.. and fighting bears were the height of amusement at the circus.

Even if I am being western-centric, the fact is that Intourist’s idea of a good time was a few monuments to Lenin and an empty soccer stadium.

I was eventually offered a job in Archangel, running a timber business with 2,000 employees. The sheer beauty and scale of the country consumed me, but the sadness of its collapse outweighed the benefits. I was 22 and I would have been a millionaire in 2 years; it wasn’t worth it. I would have been corrupted and I was an idealist. I went to London instead and learned everything there is to know about cricket.

Perhaps now, with 2 kids and a mortgage, I’d be cynical enough to take it on, just like all the people I criticize for being corporate stooges, and that makes me sad - and probably a hypocrite, which is worse. I’d like to think I still had the moral fortitude to do the right thing, but when I take a deep breath and think about my kids never having to worry about college, or my wife not having to work 60 hours a week, I shake my head. I may not be as strong as I wished.

Gergle, you’re right about the plutocracy, but communism fails on too many other levels for that to be the only answer.

Posted by: Jon Rice at July 19, 2009 1:45 AM
Comment #284688

The author wrote:

“I believe that the capitalist system can work, but only with a societal agreement that nobody should be too rich…”

Just kind of curious as to what, exactly, he meant by that?

Posted by: Doug Langworthy at July 19, 2009 2:15 AM
Comment #284689

He wants a law against anyone having too much money.

Much like FDR’s plan to tax anyone making over 100,000 at a 100% tax rate.

Then the government (though corruption, greed graft: IE politics) would determine where that money should be spent, because they would do a better job than the guy who made it.

Posted by: rhinehold at July 19, 2009 3:03 AM
Comment #284690

Rhinehold… well… that’s kind of what it seemed to me as well, but I would love to hear him (figuratively, of course) say that himself… or otherwise explain what exactly he meant by an agreement that nobody should be ‘too rich’…?

At what point is one ‘too rich’? How, exactly, is that determined? And by whom?

Posted by: Doug Langworthy at July 19, 2009 3:16 AM
Comment #284695

The “too rich” thing is tough. But I think of it in terms of the obscene salaries CEO’s make compared to their employees. There is just no reason for a CEO to make, in some instances, 400% more than their employees. That CEO wouldn’t be able to make the money he/she does without the broken backs of his/her employees, and yet the employees are the ones who have, usually, no security at all and never get a break.

The problem with Capitalism is that it creates a master/slave dynamic that can pretty much never be adjusted. The corporation can make up any rules it wants concerning pay and compensation (how come only the top management ever get those corporate sports tickets as gifts) and the workers have no choice. CEO’s can shuffle around and make giant nest eggs and live like kings (not inconspicuously) and the worker has to be thankful they have a crappy 9-5 job where they could get fired any day, have crappy insurance, and have no options because all the jobs are gone.

limiting the expanse between employer and employee is key to having a sustainable society. Otherwise the rich get richer and the poor get poorer, and the middle eventually erodes. This is what is happening hear. The greed inherent in the system, which is touted as supremely American, has created a ruling class and a slave class. unfortunately, if you have never been in that slave class, you’ll never comprehend that such a dynamic exists.

We pretend that anyone can be whatever they want, but it’s not true. In a system like ours, merit and hard work are usually not the deciding factors in wealth and security. Sure there are a lot of people who have made their fortunes, but the vast majority of hard working Americans never amount to anything and can barely retire, if at all. Why is this? If “Joe Everyman” is who builds this country, why is it his boss that holds his reins? Money. Unfair income inequality. And an artificially constructed slave/master dynamic that is promoted through the guise of democratic American capitalism.

Posted by: Mike Falino at July 19, 2009 10:41 AM
Comment #284698

Doug: by ‘too rich’ I mean that the difference between the richest and the poorest of us should be less obscene.

Warren Buffet, for example, was worth $62 billion in 2008, according to Forbes.

According to salary.com, the average salary of a US Army Private (grade E2) is $17,150.

The number of army privates, therefore, that could be paid a year’s salary if Mr. Buffet were to suddenly give away all his money, is 3,615,160.

Three MILLION, six hundred and fifteen thousand soldiers… with one guy’s money. (Our standing army comprises around 550,000 active duty soldiers.)

Or, to put it another way, enough to send a stimulus check of around $500 to every single family in America.

Or, enough to rescue the US automotive industry.

One man.

That’s what I mean by ‘too rich’ Doug.

If you look at India’s billionaires, the disparity is even more appalling.

So - do I impose an income cap? Absolutely. Absolutely. Should it be $100k? No. $1M? No. $10M? No. But does anyone really need to earn $100M in one year?

So now it’s your turn to answer a question for me: do you think it’s reasonable that one man in America could afford to pay the entire US Army, from privates to generals, for a year?

He’d have to burn $115,000 a minute for a year to get rid of the money.

Posted by: Jon Rice at July 19, 2009 10:49 AM
Comment #284699

Nice post!


The purpose of democracy s to diffuse power.

When churches ruled the state much unfairness resulted. That’s why we have set up a system that for the most part seperates church and state.

Now money rules the state. We need a seperation of money and state. Professional lobbying should be criminalized and elections should be publically financed.

Until we can set up a system were each individual is truly portionatly represented rather then the those of wealth or power getting extreme ammounts of representation nothing will change.

Posted by: muirgeo at July 19, 2009 11:13 AM
Comment #284703

Jon, perhaps you are right, I have never been there, but I remember well my father telling me about the panic in this country over Sputnik. He actually worked on tracking systems to monitor it.

The Soviet union was not a consumer economy, so there isn’t the constant one upmanship in technology like here, but that doesn’t mean they are lagging in technology either. Sometimes we fix things, making them worse.

As to the arts there seems to be a greater focus on classical arts there, rather than pop art. Granted, their architecture really sucks in style.

Agreed there is lots wrong with communism, mostly that it misunderstands man’s nature.

Posted by: gergle at July 19, 2009 1:31 PM
Comment #284707

Jon excellent article. Our system is definitely broken. Here is a website about a recent book that addresses many of the concerns in this thread.

http://www.mindfuleconomics.com/

I have just finished reading it and it seems the author feels that re-combining the work and ownership of a company would get to the “how rich is to rich issue and put to rest many of the negative comments such as the “government would decide.” The government doesn’t have to be involved when the owners of a company also work at the company much like our small business sector today. The large companies seldom have ownership (stockholders) working within the company to any degree especially those that own the largest percentages of the shares of the company.

Posted by: j2t2 at July 19, 2009 2:23 PM
Comment #284708

Jon… thanks for the response.

So if I am reading it correctly, $100,000,000 is what you think should be a legally mandated cap on earnings in a year? That is your hard line? Why that much? Does anyone really need to earn more than $10MM in a year? Or even $1MM?? What could possibly be different from $67.3MM/year versus $100MM? I think you may be selling out to the rich by imposing a cap that is so high…

So tell me, how do we measure that? Anything over $100MM, either through salary or capital gains or garage sales, is 100% taxed?

I WAS an active duty E2, thank you very much… and I was fine. Right out of high school, no education, no direction. Don’t mis-interpret my words here… I am in NO WAY saying our soldiers are un-educated or have no direction or are all out of high school… I am simply speaking of my experience specifically… And I like to think that that entry-level position into the working world helped me learn the skills necessary to work hard and climb the ladder that in our great country was there for me to climb. I can assure you, I came from nothing, and I am doing very well for myself now… that said, if Warren Buffet found it in his heart to share the love… well, who would I be to argue with what the man wants to do with his money? ;-)

To answer your question very bluntly with three simple words… sure. Why not?

Posted by: Doug Langworthy at July 19, 2009 3:09 PM
Comment #284724

Jon, IMO this is by far the best thread to date on Watchblog. It goes to the heart of the problem and folks seem to have responded more from self-expression and spontaneity than from ideology or party.
Lemme give it a try. Capitalism ain’t dead, its just been badly wounded. Couple of quotes if you will: “Those who expect to reap the blessings of freedom, must, like men, undergo the fatigue of supporting it. ~Thomas Paine
The greatest dangers to liberty lurk in insidious encroachment by men of zeal, well-meaning but without understanding. ~Louis D. Brandeis
IMO, our constitution, our sovereignty, and democratic principles we used to live by, including capitalism, has been usurped by ‘men of zeal, well-meaning but without understanding/. It is the nature of man to try to improve his lot in life, even at the expense of his fellow man. We did good in the early years following Independence. Largely because of the small, closely knit population and considerable religious order. The move westward changed all that. Reminds me that corporate personhood found its way into law through a law suit in California by a few greedy and corrupt railroad men.
To wit: first we had the creation of political parties founded by Jefferson and Hamilton to present a better organized political force in congress. Second, corporations were given some rights of humans. And third, a law was passed to the effect that ‘money is free speech’. Since the early 1800’s there has been a dance between the corporation, government, and the citizenry. Turns out the corporation is a much better dancer. Reason? A corporation has longevity and buckets of fluce. Through the three events cited our Republic nation has taken a big hit. Over time the tentacles of corporations have strangled the life from our Republic style of government
But, corporations weren’t the only culprits. The Republic was established to primarily serve as a center for security for the states and to serve as a focal point with foreign nations. But, the people wanted more from the central government. They wanted the government to help them out with some things. So, always looking to be re-elected politicians responded. They gave us an income tax so they could use some money coming in from Arizona to help some folks in Georgia, etc. And that’s the way it went. Today we have the president of the US offering to use some other tax payers money to give you a $4000 rebate to buy a new car. That’s not so much Republic government as it is Democratic. IMO we have way too much democracy for the good of our Republic. We should be reminded that the longest living Democracy lasted little more than 200 years. History tells us that a Democracy winds up with the few in control of the majority resulting in socialism and eventually anarchy. Are there signs we are well on our way down this road? I would suggest that 3000 page bills submitted within hours of a scheduled vote is one sign. Another? Ron Paul and a handful have requested that an investigation be conducted on the relationship between government and Goldman-Sachs relating to TARP and bailout funds. The top few in congress are digging in their heels to make sure this doesn’t find the light of day. I think we would all be dismayed at how little influence a junior legislator has in trying to represent your interest in congress. We can all remember the oil patch gang visiting the White House to write an energy bill a few years back.
It’s clear the deck is stacked against the voter-taxpayer because of the incestuous relationship between government and corporations. It’s also clear the government has promised too much in making winners and losers of voters-taxpayers and now has their backs to the wall. Their initial solution is to borrow trillions of dollars to keep the ship of state afloat. But, that can only be seen as temporary and a bad move.
In a nutshell, our great nation is dying fast. The big players are way more aware of our plight than we citizens. But, that doesn’t mean that won’t go over the cliff with it. They will. Just like they did during the depression. Most of the players are tied to international consortiums, conglomerates, corporations, etc. They deal with governments around the world and aren’t to worried about the plight on our Republic or our sovereignty or our democratic principles. Those folks are more interested in ‘harmonizing’ things between all nations; trade law, patent law, one currency etc. Not so much interested in your sovereign rights.
We are there. We continue to set around and debate Sara Palin or gays in the military if you like.
Or, we can set about to right some wrongs.
What are some possible solutions? Some think that if congress and the Supreme Court would acknowledge the right of citizens to an Article V convention that would provide a mechanism by which the ship of state could be righted. IMO congress will never share power with such a convention. Also, it often takes years for a petition to be ratified by one third of the states. Single threaded and slow.
Some think that voters should just smarten up and start voting from office under-performing incumbents. Our voting history shows that was done successfully in 1933 during the depression era. IMO that may happen again but voters will not stay focused to continually, year after year, vote bad apples from office.
There are literally thousands of advocate groups such as GOOO pushing for reform of one kind or another. Most are single thread issues such as abortion rights or 2nd amendment issues. And, there are a number of 3rd parties that offer agendas from A to Z. I recall the Libertarian Party wants to give Hawaii back to the Hawaiian’s.
IMO the only way we can achieve reform of government, restore the Republic (and no I’m not talking about going back to the stone age) is to put accountability into the political equation. How might we hold politicians, appointees, ambassadors, SCJ’s and the like accountable for their actions? We must fight fire with fire. Many folks dislike political parties and see them as part of the problem. But, other than a violent revolution, I see no other mechanism capable of achieving real reform of government. I’m not talking about just any third party. In order to attract the public, a new party must provide a way to achieve reform and keep it that way. Consider a party that is founded on a few simple rules that can’t be easily changed, similar to the Constitution. Have the membership serve as a fourth branch of government if you will. If a certain number of complaints are received relating to an elected/appointed official the party membership will be mandated to take a vote. If the official receives less than 66% of a favorable vote then he/she is rejected from the Party. That person would serve out the remainder of their term but enjoy no further support from the Party for future political endeavors. Additionally, the Party would put forth an agenda targeted solely at reform, void of social issues such as abortion and gun control.
You can check out such an effort at www.republicsentry.com.

Again, Jon, thanks for a great article and its pleasing to see that a number of responders voice deep concern over the sad state of our Republic. I could hang out on this thread for months!

Otherwise, we have the Corpocracy we deserve!

Posted by: Roy Ellis at July 19, 2009 9:55 PM
Comment #284734

Look at the money cha##nge “switch” Hands http://www.opensecrets.org/industries/indus.php?ind=H04 Jon rice, check out all the multi millionaires like in hundreds and hundreds of millions of dollars in the congress/ senate your party leads the list : /

Posted by: Rodney Brown at July 20, 2009 12:09 PM
Comment #284736

Here I’ll help. http://www.opensecrets.org/pfds/overview.php?type=W&year=2007

Posted by: Rodney Brown at July 20, 2009 12:25 PM
Comment #284742

In my view, where this debate goes off the rails is when we start putting forward false dichotomies that pin the economy between two false polls of free markets and socialist command economies.

When we talked about the free world and the free markets, what we talked about for the most part was a world of comparatively high taxes, more stringent trade laws, and much more restrictive finance regulation. And we won the cold war with this version of the free market. It’s not until later, in the wake of all this, that free markets becomes identified with a much, much looser, much more laissez faire vision of the economy.

I’m approaching thirty years of age. Which means, that much of this period of deregulation and stagnant wages has been my sole experience of the market. Markets seem more unstable, and what once would guarantee you a job, a college degree, is now no guarantee at all. I have seen, in the course of my life, the bond market collapse, the stock market crash several times, the banks and savings and loans take their new deregulated authority and cause severe economic disasters. I have seen business time and again violate the trust of the stockholders, when given the chance.

Yet I retain a certain faith in a market where people set the prices. I believe there is some merit to that idea. But I don’t share the notion that the market functions this way naturally, if you let the market alone.

I believe laws must be enforced, and laws imposed in order to force people to do things that they might not otherwise see as in their best interest. Things like telling the truth about how your business is really. Things like not acting in anti-competitive ways. Things like not gobbling up competition and growing market share until whole markets are swallowed up.

I don’t believe the government can tell a business to do everything, micromanage it, and things come off right. But there are certain principles that remain true over the long run, principles like preventing conflicts of interest, saturation of the market by a few competitors, and disclosure about a company’s finances.

I think there the government can and should intercede. We cannot expect self-interested parties like corporations to act in the whole nation’s best interest. It’s not even the role we give such corporations under the law. We tell them to do all they can to serve their stockholders, to make them money. The only time when they can work against their interests like we want, is when we tell them they must under the law.

We, the people, are the ones who should look to those interests, and set the community standards for what behavior we allow. The economy belongs to all of us, is there to serve our interests as a whole. It’s not meant to enrich a few at all other’s expense. America has prospered because it has delivered more wealth to the middle class and poor than anybody else in the world, and in turn, those people have helped to make many a rich person out there.

This isn’t about rich agains poor, about class warfare. What Democrats and liberals like myself want is an end to the relentless war on the interests of the poor and middle class, in the name of improving the economy. You can’t run a consumer economy by squashing the consumers underfoot. If they don’t get their share, the economy gets atherosclerotic and tired, like it is now. We cannot be a strong economic power by undermining the strength of our workers and employees.

Posted by: Stephen Daugherty at July 20, 2009 2:47 PM
Comment #284746

Thank you for that Stephen. Now come out strong against the importation of 10% of the Mexican population for cheap labor into this country and you will be even more believable. Or, perhaps a strong statement against the proposal to fast track 12-40M illegal immigrants into citizenship while the taxpayer picks up the tab for their healthcare along the way.

Posted by: Roy Ellis at July 20, 2009 6:28 PM
Comment #284747

Stephen,

You said, “In my view, where this debate goes off the rails is when we start putting forward false dichotomies that pin the economy between two false polls of free markets and socialist command economies.”

And I couldn’t agree more. This is absolutely a false argument that I believe that even the staunchest socialists have disavowed themselves of with the fall of the major planned economy states in the 90’s (the Eastern bloc) or their move to more capitalistic versions (China).

You also said, “It’s not until later, in the wake of all this, that free markets becomes identified with a much, much looser, much more laissez faire vision of the economy.” I think that this debate has always raged and hasn’t changed dramatically in the past century. The question is which viewpoint prevailed not whether the debate existed.

You also said, “Which means, that much of this period of deregulation and stagnant wages has been my sole experience of the market.”

I’m not sure what period you are referring to. Is that your entire life or just your adult life? For if it were you entire life, I think that you would find that the statement is not exactly true.

Also you have equated the period of deregulation directly with stagnant wages in time. Deregulation has been around considerably longer than the “stagnant wages” period if you are referring to the most common definition of the past 10 years.

You also said, “Markets seem more unstable, and what once would guarantee you a job, a college degree, is now no guarantee at all.”

Again, these two events under scrutiny are not by any means paralell and both deserve their own root cause analysis. While they may be tangentially related, there is no direct cause and effect relationship.

You also said, “I have seen business time and again violate the trust of the stockholders, when given the chance.” I believe that this is not any more or less true today than it has been since the notion of shareholders began. While the scandals certainly have become more frequent, they have existed in the past.

You also say, “Yet I retain a certain faith in a market where people set the prices. I believe there is some merit to that idea. But I don’t share the notion that the market functions this way naturally, if you let the market alone.”

I think that your lack of faith is unfounded. If there has been one thing that has been relatively uniform in our history, with the exceptin of certain agricultural markets, it is that the government has relied on market based pricing. This works. The question and one that is clearly part of the Econ 101 text books is that the market pricing will only rely on demand unless the government forces longer-term externalities to be included through regulations. The political debate is largely over how to do this correctly not whether it should be done.

You also said, “I believe laws must be enforced, and laws imposed in order to force people to do things that they might not otherwise see as in their best interest. Things like telling the truth about how your business is really. Things like not acting in anti-competitive ways. Things like not gobbling up competition and growing market share until whole markets are swallowed up.

I don’t believe the government can tell a business to do everything, micromanage it, and things come off right. But there are certain principles that remain true over the long run, principles like preventing conflicts of interest, saturation of the market by a few competitors, and disclosure about a company’s finances.”

On the whole, I don’t believe anyone of any political stripe, except for the most radical, disputes this. The question and the debate is in the details. When does regulation become too much and counterproductive. When does not enough regulation become too little and counterproductive. This is political and economic art and as such the results are in the eye of the beholder.

You also said, “The only time when they can work against their interests like we want, is when we tell them they must under the law.” Actually, this is not correct. There are companies, many of them in fact that believe that doing this is in-line with their defined corporate mandate absent government intervention. There are those that do it in a self-interested way because they believe that it is ultimately good for their long-term business over their short-term gain. There are also those that do it because they have decided that is what they should do. This erroneous interpretation is bound up in this misunderstanding, “It’s not even the role we give such corporations under the law. We tell them to do all they can to serve their stockholders, to make them money.” Actually, the law allows them to do this not tells them to do this. As long as the shareholders don’t revolt, and in most corporations that would be a Cybil-like revolution, they are free to operate as they like within the law. So, many have prioritized activities other than making money within their corporate objectives. There are actually mutual funds that will allow you to elect to invest in these companies.

You also said, “We cannot be a strong economic power by undermining the strength of our workers and employees.” Actually it can, history has proven that you can actually do this more easily than the taking care of them. However, I realize that you are making a political debate not an economic one, so I’ll overlook this flourish of rhetoric and debate you point not your words:

The question is not whether but how. I don’t believe that Republicans/ conservatives believe that the best way to run the country or the economy is to make the poor suffer. Rather, they believe that the country as a whole will be better positioned to succeed if companies are given the lattitude to perform better. This has proven to be true in some decades and false in the current one. Rather than debating in absolutes, I think that we would be much better off debating in specific ideas and proposals since those are where the rubber truly meets the road, and the true objectives can be better realized.

Posted by: Rob at July 20, 2009 6:35 PM
Comment #284749

Roy Ellis-
I believe I already have made that point. Some discount what I say because I don’t believe catching all these people at the border is practical, and I prefer making internal enforcement stronger and more efficient.

I do believe in not demanding citizenship papers if there’s any kind of healthcare reform. Why? Because we’ll not only soak up expenses in emergency room care, we’ll also get hit with the bill for whatever epidemics come our way as a result of having a pool of millions of untreated people in a coherent community.

It’s cheaper to prevent a problem, in this case, than clean it up, illegal immigration politics notwithstanding.

I would want to clear the decks of the wreckage of about twenty years of dysfunctional policy, though, and I would most definitely sign on to the concept that you want to make it easier for people to do things the right way. I would propose that there be some kind of penalty for being illegally immigrated when you report yourself to the authorities as an illegal immigrant, but that it be something you work off by either waiting longer to be a citizen, paying fines, or being on some sort of legal probation where being involved in criminal activity or not holding down a job would send you home from whence you came.

I think the hysteria over illegal immigration hasn’t helped things. Literally. It only got worse as the tone got uglier. I think we need to make it less about jobs and economics and more about security. Nothing good comes from having inadequate control of the territory, and the literally one dimensional thinking that prompts efforts to fortify the southern border neglects the interior efforts needed to improve the situation.

Posted by: Stephen Daugherty at July 20, 2009 8:08 PM
Comment #284751

Stephen,

On the topic of immigration reform, I agree with the most important of what you say above: “I think the hysteria over illegal immigration hasn’t helped things. Literally. It only got worse as the tone got uglier.”

I agree generally with your post as well. The solution to illegal immigration is not to make illegal immigration more difficult but to make legal immigration easier. There are good reasons why immigrants have always come to our shores, we should continue to receive them with open arms. They help us all. We just need to make sure that our nation remains secure.

Posted by: Rob at July 20, 2009 8:31 PM
Comment #284763

Jon wrote that banks wwon’t cash Calif IOU’s. The FED is giving CA some $12B through the Recovery Act and will, over the next few years give them $50B of taxpayer dollars. Calif. is in debt in part from supporting their large illegal population. As a taxpayer I’m not at all happy with this transfer of (my) taxdollars or of the government making winners and losers by shiftng tax dollars around in suppor of an illegal activity.
Rob, I’d be interested in some details as to how the immigrant worker is helping us out.

Posted by: Roy Ellis at July 20, 2009 10:27 PM
Comment #284778

Roy,

The legal immigrant worker is not only helping us but is a deep part of our cultural heritage. One of our more timeless icons is the Statue of Liberty on Ellis Island. That statue stands as a beacon of freedom and a reminder to us all, that our freedom was acheived by our forefather who had the courage to leave something they knew in search of something better.

There are definitely problems associated with illegal immigration. However, the large majority of them have more to do with the immigration being illegal than with the fact that the immigrants are here. Legal immigrants pay taxes and contribute to our society in the same way that citizens do. They enrinch our society with the same hope and optimism that our forefathers brought with them. They enrich our society with the same work ethic that our forefathers brought with them.

Illegal immigrants are generally no different on the whole from legal immigrants except that they are forced to work outside system. When they work outside the system, everything they do is compromised. They now must become criminals to work (either before with forged papers or after with tax evasion). Their illegal status forces those that employ to become criminals as well just for employing them. Additionally, employers can take advantage of the illegal immigrants status by paying them below legal wages, ignore child labor laws and other workplace laws. In the worst cases, they can treat these people like slaves or indentured servents. They can do this because they know that the illegal immigrant like our forefathers came here to make a better life and want to stay. They will not compromise this by drawing the attention of authorities to their plight because it also means drawing the attention of authorities to them and their illegal situation.

These problems are not born from the fact that we have immigrants in our workforce or in our country. They are born out of the fact that they are here illegally. Now there are additional problems that come just from having people in the country, crime, disease, and the like. But I have not seen any real statistical evidence that the rates among these populations is any higher than it is among the legal immigrant or citizen population in the same socio-economic cohorts. (It is worth remembering that we have illegal immigrants that are not just mere labors, some of them make some pretty good money).

While there are legitimate arguments that can be made from an economic perspective as to whether having a certain number of legal immigrants in our country provides a net economic benefit or not, there is not by any meanse a concensus in this analysis. However, until such a day arrives that that number is known and perhaps even after it, I would submit that we are better off as a population because of the intangible values that a legal immigrant population brings us: a reminder of our cultural history, the optimism that those brave enough to leave a known situation for an unknown have, and for me personally, the food. Roy, have you ever had bibimbap, that alone should convince you that immigration is worth it.

Posted by: Rob at July 21, 2009 10:37 AM
Comment #284810

Thanks for the post Rob, Nope, I’ve never had bibimbap. But, I have eat octopus in Lima, goat in Argentina, roast suckling pig in Rio, chicken foot soup in Ecuador. Also, had some goat eyes in Jeddah, all kinds of wild things in Conakry, and all good stuff. It’s clear your approach to immigration is far different than mine. My position has been honed over the last 40 years or so. During the Regan administration the government offered amnesties for 3 to 4 million illegals and offered the public a promise that illegal immigration would be stopped. I was on board with the political system until the Regan era. Since then we have had NAFTA and free trade shoved down our throat. Even had the NAU set up, a second government, without the public ever being made aware. Then we’ve had the economic bubbles spurred on by the likes of Phil and Wendy Graham. In short, I no longer trust government or the Corpocracy. I come at it from a couple of perspectives. One being my opposition to anything the government wants to do, as I’m sure I’ll get screwed in the end. Two, rather than families being divided and risking life and limb to get here I would prefer they work to develop their own country. Rather than a NAFTA free trade approach I believe we should be directly supporting developing countries by building agri business, mining operations and the like. Things that are substantial, productive, and lead to growth and economic prosperity. Instead, Obama just got back from Africa where he promised so many billions in healthcare (condums and aids medicine) and knowing full well that any monies reaching those shores will end up in a Swiss bank drawing interest for some dictator. Three, we ain’t doing badly in bringing immigrants in through the front door. I think 2-3M a year, far exceeding the number taken in by any other country. It’s obscene having twenty some temporary worker visa programs whose purpose is to provide Microsoft and the like with cheap technicians. Four, I don’t like illegal labor serving as the economic policy for this country. This policy clearly serves the interest of the Corpocracy and not the 15% of unemployed US workers. Five, I do not want my taxes going to bailout Calif. for their indebtedness brought about by supporting a large illegal population. Six, I want the border controlled for terrorist activity, illegal immigration and drugs. This Corpocracy has no intention of shutting off drugs at the border. The majority of drugs are coming across the border in 18-wheelers, waving their EZ pass cards as they move across at 50mph. The cartels have their made guys in the border patrol. They know which guards are on which lanes at which times. Not a hard thing to do, inspect trucks. But, with EZ pass there is no inspection. Pre-approved, just keep moving. It’s a 10-40B dollar business that the Corpocracy won’t give up without a fight. Likewise, not fond of the state and federal parks being used by the cartels to grow their dope. Seven, and then there are the gangs, crime and all that. Numerous hospitals in the SW have closed down primarily because of the illegal population.
Well Rob, that’s where I’m coming from. Appreciate and understand your position. From the human perspective there is a lot of pain and misery going on. But, I see the rule of law and the need to reform government as a first priority. Otherwise, we should expect to see 50-100M Chinese show up on our shores next week.

Posted by: Roy Ellis at July 21, 2009 10:08 PM
Comment #284843

Rob we were also, at one time, an agrarian nation of 3.9 million people. Times have changed. We do not have the industry available to continue to gainfully employ all the citizens of this country let alone people immigrating from other countries. Do we slam the door shut, probably not but we do need to stop illegal immigration and the business use of immigrants to lower wages in this country.
It just doesn’t make sense to continue to use the argument that we did it in the past therefore we should continue doing so when the population of this country has increased to 350 million people does it?

Posted by: j2t2 at July 22, 2009 9:39 PM
Comment #284874

Good point j2t2. One could rattle on for megawords about the ills of immigration. Few would object to a controlled flow of immigrants. I believe we now have about 2-3M yearly under present law and that level seems more than adequate. Certainly, we should be empathetic to political prisioners.
Immigration made sense with a new country and with expansion westward. Things have changed dramaatically since those times. IMO we should be working to lower the population of the world. It’s a trade off between arable land and the number of people. And, many resources are finite, or not easily replaced. I’m torqued about paying taxes in my state to support learning instituions where 50% of the graduate students are foreigners. We have young people with 4.0’s that are not accepted by the 3 or 4 largest schools in the state.
In the news recently that to support the retiring boomer population we need about 46k more nurses. The Corpocracy intends to bring nurses from the PI to take care of the shortage. At the same time, every year there are 40K qualified US applicants applying for nursing that are turned down. Ostensibly because there is no facilities or instructors to train them.
Bold faced lie fer shure. But, as I noted in my earlier post, I stopped believing the government many years ago. So, its a wash with me. But, it sure is a multi-faceted thing. Effects just about everything and everybody in one way or another.

Posted by: Roy Ellis at July 23, 2009 11:20 AM
Comment #284905

The problem with nursing schools Roy is they do not pay as much to teach nursing as a hospital does to employ a nurse. I realize the answer is to up the pay for those that teach nursing and to increase the number of nursing programs but those land grant schools we pay taxes to support take their orders from the corporate hospitals not we the people.

Posted by: j2t2 at July 23, 2009 6:33 PM
Comment #284930

What is it about being raised to the highest ranks whether it be political, religious, or sports, that invites corruption? Money laundering, fraud, scandal, substance abuse, molestation…. Too many use the government as the scapegoat for the woes of our country. What happened to individual accountability? How can we respect leaders who don’t even have enough self-control and morals to follow the laws themselves, who are guided by greed? And what kind of examples are they setting for our kids… the leaders of tomorrow when they use frivolous defenses in court to avoid retribution? No wonder our country is in a state of disarray. It appears there is ENOUGH money floating around to run the country, it’s just in the wrong hands and not being used wisely. Obscene salaries of sports figures/actors, their excentric lifestyles, mind-boggling bonuses of CEO’s, funds supporting cultish activities, fraudulent medicare practices, overpriced drugs/healthcare, pork spending/lobbying bribes, oh and I can’t forget the worst of all- a bottomless defense fund that allows us to bully our way around the world. The state of our economy has been self-inflicted. Some people accuse our government of becoming more and more socialist. Excuse me, this is not a conspiracy promoted by one party or another. It is the natural progression of a society that expects everything handed to them or they find under-the-table means of getting it. And then we squawk about our taxes going up to cover all these programs and tightening regulations(eg socialism). And the most vulnerable ones are also scapegoated; the homeless, the mentally ill, children born to uneducated mothers of generational poverty, immigrants trying to escape horrendous conditions in their own countries, and unemployed victims of an economy that has sold out to cheaper overseas labor. They get the blame for budget deficits and the most attention when debating cuts. Those who continue to operate their businesses/lifestyles honestly and within their means are the ones suffering and left to pay the bills.

Posted by: Michelle from Iowa at July 24, 2009 9:01 AM
Comment #284935

Thank you for that, Michelle! Right on target. This thing has evolved over a couple of hundred years and won’t be easy to unwind or correct. Thomas Jefferson would have taken to arms decades ago. I recall back in the 50’s and 60’s when big giveaway programs came about we would say to each other ‘how amazing, I guess we can afford it now but this can’t continue for it will surely be our ruin at some point down the road’. And, I’m pretty sure we’ve about reached the end of the road. Yet, few seem to realize the situation for what it is. Beats me why anyone would think that healthcare reform or any similar issue can be resolved ‘for the good’ in such a corrupt environment. The Democrats are like a frenzied dog, tearing themselves apart over this one issue. Not because of what might be good or bad for the health of citizens but fighting over the money part, the profit, the business.
In brief, it’s not longer ‘we the people’, its ‘we the Corpocracy’. Since when has my representtives actually represented me or anybody I know in my community? No representative came to this county and asked for our thoughts on:
healthcare
cap and trade
patent law
federal authority over water
do we mind if several million illegals are given citizenship
do we mind if they use our parks for growing weed.
would we like to have an NAU
would we like some free trade
would we mind if they put a 12 lane highway thru the midstates to serve free traders.
can we tolerate a little gang warfare and drug cartel shootouts. After all it is just business.
do we mind bailing out Calif and like states that have blown their budget by supporting millions of illetals
It’s like Jim Webb got sucked into a black hole. He went to DC, was on cspan banging the gavel for a week or two and then - - nothing. Have seen nor heard from him. Doesn’t matter, as a junior in congress he has no power to represent me anyway. The pecking order doesn’t allow for that. No bill comes or goes without the Corpocracy saying it comes or goes. And, when my rep does get a chance to vote he’she had better bote for the Corpocracy, otherwise he stands little chance of being supported for re-election.
A hopeless, useless situation. Let’s get on with reform. Republicsentry.com

Otherwise, we have the Corpocracy we deserve!

Posted by: Roy Ellis at July 24, 2009 11:22 AM
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