Tag Archives: Wall Street

The “We” and “I” That Make “Us”

January 28, 2013

I have always viewed conservative columnist David Brook’s comments as a barometer for the right. I like that he approaches ideological differences between the Parties by appealing to our intellect rather than our emotions. But like any good political pundit, Brooks is a craftsman with words aimed at creating an illusion not altogether in line with the real message of his more liberal adversaries.

He is not in the camp of the ideological extremists but he does promote a conservatism that none-the-less represents views that stand in stark contrast to what he might view as an imposing liberalism. His most recent column posted on the MLK holiday doesn’t deter from this paradigm. In it he praises the merits of Obama’s inaugural speech while also trying to show where the division lies between him and other conservatives and the “liberal” proposals that the President laid out for his next four years.

Unlike the conventional approach that tries to divide people utilizing the “we” versus “them” tact, Brooks uses a slightly altered version that builds on a “we” versus ”I” theme. That’s like “we” in welfare and “I” in Independent, as Brooks is suggesting. It’s another approach that attacks the very real problem of class warfare in this country, something he and his conservative fraternity have attacked for being a distraction to more important matters, like supporting the silly notion established in Citizens United that money is the same as speech.

Brooks is back to using cold war semantics by painting the collective we as a form of “centralization”, a word that is always code for communism and socialism in the conservative vernacular while raising the merits of the “I” aspect of decentralization. The latter is a favorite meme of the laissez-faire model popular during the 19th century Gilded Age and more recently with those who worship at the alter of Ayn Rand’s self-interest model – objectivism. A model that rejects humanity’s altruistic nature.

“Obama is liberated”, Brooks tells us and “he has picked a team and put his liberalism on full display”.

He argued for it in a way that was unapologetic. Those who agree, those who disagree and those of us who partly agree now have to raise our game. We have to engage his core narrative and his core arguments for a collective turn.

I am not a liberal like Obama, so I was struck by what he left out in his tour through American history. I, too, would celebrate Seneca Falls, Selma and Stonewall, but I’d also mention Wall Street, State Street, Menlo Park and Silicon Valley. I’d emphasize that America has prospered because we have a decentralizing genius.

Notice how Brooks categorizes Obama as liberal as if anyone who sides with an idea favored by liberal constituencies is in fact a card-carrying liberal. I wish Obama was a liberal but the reality is that his membership in such a club would be conditional at best. And perhaps this is as it should be for the leader of the free world who has to straddle both sides of the political spectrum in this country. But the not-so-subtle labeling of the President as a full-fledged liberal is meant entirely to irk the extremist on the Right who already are convinced that the President is a Muslim socialist. And oxymoron in and of itself.

His argument to distinguish between the concepts of “centralized” and “decentralized’ is yet another dichotomy that conveys a simplistic black and white comparison that ultra conservatives will interpret more along the narrower frame of reference, good vs. evil.

It may well appeal to most people at first blush. It was after all through the efforts of people who were able to capitalize off of a pro-entrepreneur government and create an economy where at one time opportunity was boundless for the eager creative individual, at least more so in our earlier history than it is now. Most frontiers of entrepreneurial success have diminished in terms of resources where land was vastly available and minerals had yet been fully exploited. Today’s entrepreneur has to work within strict confines that have in part been devised by their powerful peers and their connections in politics.

Here’s where Brooks’ concept of “a decentralizing genius” breaks down. The open-ended approach that allowed the Carnegies, Rockefellers and Morgans to succeed in the 19th century was eventually met with the resistance of a public that suffered the numerous abuses of laissez-faire economics. Along with a person’s labor value there were also the legitimate concerns of the common men and women about their living and working conditions as well as their health; something that suffered from a capitalist class who saw wages and government oversight as inhibitors to their personal wealth.

If it dawned on the Robber Barons of 19th century America at all that working long hours in unhealthy working conditions for wages that barely eked out a living, with no hope for the future was demoralizing, those captains of industry concealed it with a premise that belied the greed of the nouveau riche and the old aristocracy who wrote the laws in the 18th century that protected the interests of the propertied class. This premise became institutionalized in Herbert Spencer’s concept of the survival of the fittest. Something he purloined from Darwin’s natural selection of species theory and extrapolated into the corporate world, with a supporting role from Adam’s Smith’s “invisible hand” of the free market.

I thought it odd that Brooks would mention Wall Street as one of the heroes in his decentralizing genius offering. Though it was at one time the bastion of free markets that raised this country to its economic heights it is today reviled by most as nothing more than an elite entity that drives prosperity, not for the many as much as it does for the wealthiest 1% in this country. A fact that has been borne out by the current figures showing an income increase of some 265% by billionaires while most everyone else has seen their income shrink over the last 30 years.

Brooks’ notion that the decentralized individual has made America prosperous omits those parts where wealth has gravitated towards a select few through lying, cheating and stealing. The Savings and Loan scandal, Enron and the financial malfeasance of the finance industry which led to the Great Recession are some of the more glaring examples of this. It has been these demoralizing behaviors that have elevated the plutocracy in this country who have been shamelessly held up by wealthy wannabes. Were these indeed honest and altruistic-spirited men, there would be no need for those “centralized” efforts of government to keep such destructive and self-servings acts in check.

I salute the character of an individual who through their energy and insights have created those products that engineered one of the greatest economies in the world. But for Brooks or anyone else to believe that they did this with only their own capabilities and resources is to ignore that collective feature which enabled individual ambitions to succeed.

Manufacturing in this country, that originated through the theft of industrial technology created in England, relies on the labor of people. Without that labor anything that the mind can imagine would most likely not come into existence. It requires the training of educators to provide skilled and intelligent workers and managers as well as financial support from banks who rely on deposits from the common man and woman for those entrepreneurs to succeed. It requires the shared costs through taxes to build the infrastructure that allows commerce to move freely and expand.

When it becomes part of the mindset that the individual is the master of his destiny disregarding the community he or she relies on to achieve and acknowledge their goals, that construct for greed begins to form and the anti-social characteristics it breeds poses a threat to the social stability we all rely on to prosper and feel secure.

When the “I” dominates the “We” then the moral bearings of society are lost, allowing us to disregard those who will sometimes fall through the economic cracks. It then becomes easier for successful people who have been more fortunate to demonize those struggling to survive as “hangers-on” or “takers” and “moochers” for fear that they may have to share what all of us are in part responsible for creating.

Though the concept of “we” is more inclusive than the “I”, both should shift to the more encompassing “us”. It is through the combined efforts of individual aptitudes and group strengths that will enable all of us as one people to persevere.

Posted by lbwoodgate in Society and Politics Tags: Ayn Rand, Barack Obama, capitlalist, centralization, class warfare, communist, corporate darwinism, David Brook, decentralization, free markets, us versus them, Wall Street

9 comments

A Final Thought on Gun Violence and the Shootings At Sandy Hook Elementary School

December 19, 2012

What leads one to purchase a small arsenal of assault style firearms unless you are part of a militia in a war-torn country or a member of a drug cartel? What drives some of those in the U.S. to purchase an excess of guns to feel secure in their homes?

As more information evolves from the tragic killings of twenty 1st-graders and 6 adults at the Sandy Hook elementary school in Newtown, Connecticut, a profile has emerged of the mother of Adam Lanza, who herself was killed by her son prior to the school massacre. Nancy Lanza was killed with an assault rifle she purchased along with two other semi-automatic handguns, a shotgun and a hunting rifle.

Away from her house, friends characterized the 52-year old sandy-haired mom of Adam Lanza as a generous soul, who was willing to share the substantial income she received in an amiable divorce from her husband, Peter, in 2008. She was well-liked by her neighbors and many of the friends she played bunco with, a favorite parlor game of this small, affluent New England community.

But hidden beneath the surface was a woman who not only dealt with the looming threat from ever-increasing behavior problems of her young adult son who had Asperger’s syndrome, but one who had come to assimilate the fear that an economic collapse in this country was just around the corner. This latter state of mind drove her to start making preparations for such an event and in so doing, led her to purchase an assortment of weapons she perhaps felt were necessary to fend off those who hadn’t prepared and would thus come after those who did.

Nancy Lanza, whose gun collection was raided by her son Adam for Friday’s massacre at Sandy Hook school, was part of the “prepper” movement, which urges readiness for social chaos by hoarding supplies and training with weapons.

“She prepared for the worst,” her sister-in-law Marsha Lanza told reporters. “Last time we visited her in person, we talked about prepping – are you ready for what could happen down the line, when the economy collapses?” SOURCE

As this revelation manifested itself, I couldn’t help but think how this “survivalist” seed that was planted in her mind was the origins of a crime that would shock a nation that was already becoming numb from the growing number of mass killings in this country. Who would have thought that the fear that gripped people like those at Ruby Ridge and the Branch Davidians in Waco would be a causal factor that has now changed the way we look at gun ownership.

What was always a part of the end-timer fears found amongst small contingents of anti-government and zealous religious groups – usually blue-collar types with no more than a high school education at best – became a way of life for Nancy Lanza who was more a part of upper middle-income lifestyles that included a college education and an income derived from Wall Street activities.

There is a veritable smorgasbord of personalities and cults who preach that end-time conditions are upon us. There has been for as long as I have been alive. But it seems that such groups have become more pronounced over the last few years, ever since that “socialist” Obama was elected, implementing policies that some people have concluded will lead to economic ruin.

Though many of the people who take this tact genuinely feel that prophecies regarding an Armageddon are in place, there are those who raise this level of paranoia to take advantage of people’s fear simply to turn a buck for their own self-gain. People like self-proclaimed survivalist movement “pioneer” Miles Stair.

Stair has written a series of booklets and newsletters on such a movement and created a website, the End-Times Report where he warns adherents that “Time is fast running out to get preparations done for hard times.” One of the booklets he hawks on this website is entitled Survival Reloading that tells readers to “Keep your rifles and handguns shooting with properly reloaded ammunition using portable reloading equipment.” It comes as no surprise either that Mr. Stair also has another business he calls the Wick Shoppe that just happens to sell “the world’s largest selection of … quality kerosene items since 1999.”

I have no idea where Nancy Lanzer’s source of information came from about preparing for economic hard times that likely suggested arming herself. Nor do I want to dwell on this subject matter that has led many to spend what resources they have preparing for a dark day that exists more in the minds of people who are too easily convinced of such fears than planning for a future of promise and growth.

But I do raise this aspect that is now related to the tragedy in Newtown to demonstrate that guns in this country, once viewed as a source gathering food and a defense against unknown threats in frontier regions, has evolved into a culture that now makes this country the primary marketer of firearms around the world.

In 2011, US corporations sold 75% of all the arms sold in the international weapons market, some $66 billion of the $85 billion trade. Russia was the runner-up with only $4 billion in sales.

The US share of the arms trade to the Middle East has burgeoned so much in the past decade that it now dwarfs the other suppliers, as this chart [pdf] from a Congressional study makes clear. SOURCE

It is this culture of guns and their destructive capabilities we have developed along with other factors that create a fertile medium where the seeds of mass killings are planted in the minds of vulnerable people like Nancy’s son Adam. Most people who own guns to feel secure in their homes likely pose no threat to their community.

Not counting the innocent deaths of children who get ahold of their parents’ poorly secured guns and accidentally discharge them, guns are relatively safe until they get into the hands of that small percentage of people who are not legally qualified to own firearms and fall through the cracks. Background checks are required only with licensed dealers. Roughly 40% of the guns sold in this country are sold through gun shows and individuals who are not required to perform essential background checks. In the harried minds of such sick people who may also have been overwhelmed by socio-political tensions common today, guns will kill more people much easier than any other weapon at their disposal.

It is in this understanding that the efforts to regulate guns in American society needs to be addressed. Personally I would have no problem with it if guns were no longer a part of our lives. I did my share of game hunting as a youth and qualified with the M-14 rifle while serving in the Marines. I know their deadly capabilities when operated by thoughtful owners. I shutter at the death and destruction they exact in the hands of desperate criminals and mentally imbalanced individuals.

The insane notion aroused in many by the gun industry’s handmaiden, the National Rifle Association (NRA) that any all firearms are legitimate wares to offer the general public, has proven to be a nothing more than a deception to increase the profits of some 114 manufacturers in this country. Though on the surface they argue the more benign view that Americans have a right to feel secure in their homes, there is that underbelly of fear promoted by the other for-profit groups that create an unwarranted urgency to stock pile weapons in the events of economic collapse brought on by political upheavals or long-held prophecies of spiritual Armageddon. Alleged threats that often peter out shortly after they’re declared but which constantly keep some people on edge.

It is this frame of mind that Nancy Lanza apparently found herself a part of several years ago. A belief that required the purchase of deadly weapons and found a home in a place where a child with serious mental disorders would eventually get his hands on them and end the lives of 26 innocent people, most of them still years away from experiencing the joys of adolescent love and building a life around their dreams.

…the evidence is clear: we have the current gun laws — ineffective as they are — because we have neglected a right even more important to Americans than the right to bear arms: the right to be safely unarmed. SOURCE

The belief that the 2nd amendment was meant for anything other than forming a “well-armed militia” to feel secure in our communities or personal ownership of a simple firearm to feel secure in our homes is a false belief fostered by people who see potential earnings in the fear-gripped minds of otherwise normal, decent human beings. That their passions for profits would lead to a siege mentality in this country and put deadly weapons in the hands of people who cannot function rationally in everyday society is something that needs to be exposed.

The public debate on this issue should not be focused on taking guns away from the majority who own them, but to ensure that those who do are the least likely people to walk into a crowded mall, theater, school or public square and fire off multiple rounds in seconds, ripping flesh and bone from people who simply had the misfortune of being in what most would consider a safe environment. This is the conversation we need to start having now so those who complain that the blood isn’t yet dried from this recent tragedy won’t be making similar absurd remarks the next time it occurs.

We can Fix the Gun Problem

Posted by lbwoodgate in Gun Control Tags: Adam Lanza, Asperger syndrome, Branch Davidians, connecticut shootings, end-timer reactions, fear of economic collapse, mental health and gun control, Nancy Lanza, Ruby Ridge, sane gun control, Wall Street

13 comments

This Is For Real Folks!

October 29, 2012

Will the choices we make November 6th be based on reality or fantasy

Reality meet Fantasy

Well at long last we’ve arrived at the final week before the Presidential elections and the outcome looks like its going to be a close one. Most people have made their minds up and supposedly there are still a few holdouts that haven’t been able to determine where the candidates stand on issues they feel are important to them. Really? Did they just return to Earth last week or have they been ignoring all political commentary and the debates for better TV fare like Real House Wives or Pawn Stars?

The economy is still the biggest issue for most people and many are basing their choices on how well they think Obama has handled the mess he inherited from the Bush White House. Thanks initially to Bush’s Secretary of Treasure, Henry Paulson, Wall Street is prospering while many on Main Street have yet to get past this recession. Yes, I know. Obama has carried out the second part of this bailout but he didn’t completely abandon Main Street either.

Many voters will be unduly influenced by the distortions and lies they hear from the right about taxes being too high (they’re lower for 98% of us than they’ve been in fifty years) and debunked notions about Obama’s birthright and political philosophy. Despite bringing many Wall Street types in to fill cabinet and administrative posts and continuing the Bush-era use of torture, keeping Guantanamo open and accelerating the use of drones in Pakistan, Obama is portrayed by the right as a radical who wants to impose sharia law. Beyond all of this I have heard comments from people I love very much that Obama is weak because he “bows to foreign rulers”. George W. can walk hand in hand with King Abdullah of Saudi Arabia but if Obama extends a cultural courtesy to the man one time, as he did at the 2009 G-20 summit in London, he is somehow demeaning the stature of the American presidency?

Adding fuel to the doubts of some about Obama’s legitimacy to be president is a film recently released with the hope of exploiting this absurdity. The movie, “2016: Obama’s America” written and directed by Dinesh D’Souza, is what one critic calls a “shaggy, piecemeal right-wing screed” and a “crude and sloppy … piece of campaign-season partisan hackwork”. Part of the film deals with D’Souza’s attempts to exploit the fear of those duped by the nut-case, Orly Taitz, who claimed she had proof of Obama’s birthright as a Kenyan only to find out it was a forged, amateurish document.

But D’Souza’s scheme is much grander than Taitz as he tries to make the outlandish link between Obama’s “socialist” father and some anti-colonial notion that he inspired his son to spread around the world, I suppose that in the event he would someday became the leader of the free world. After all, what father doesn’t think his son can be President of the U.S. So what if the father in this case was an African national who gave his son an endearing American name like Barack Hussein Obama. Some just dream deeper than others. Others critics of this film have equally debunked the premises of D’Sousa’s.

Not wanting to be outdone and insuring that his ego doesn’t suffer, Donald Trump is back in the news again challenging Obama’s academic creds. “The Donald” is a bit of a joke to even most conservatives so I won’t waste a lot of space on this here, but will encourage you to read Jean Calomeni’s Snoring Dog blog piece about this moronic move by the reality TV host.

Obama slams Trump on Tonight Show

I fear that well-intentioned people have been led astray by these huckster’s and to the likely detriment of our democracy in the future. I have a young friend who posted the following on his Facebook page:

“I don’t care for Obama or Romney but Obama had his turn and didn’t do that good. So Romney it’s your turn buddy! Please do better then(sic) what we had to deal with the last 4 years!”

I just want to shake the young man and tell him that this isn’t a crap shoot. This is like thinking your luck at a casino will change if there’s a different card dealer. Learning all you can about poker is more apt to benefit a player than picking someone the casino selects.

Like so many others who have listened more to the angry and unfounded claims of political pundits rather than using legitimate fact checkers and reading a variety of sources that haven’t had their credibility tainted, my young friend is fixing to make a choice that has long-term consequences. If in fact Romney gets elected and carries out his campaign strategy and promises, this young man’s grandmother’s prescription drug costs will rise once Obamacare is shut down and the “donut hole” comes back.

His own parents’ medical costs will be negatively impacted when they reach the eligible age for Medicare in about ten years if this safety net program becomes the voucher program Paul Ryan wants it to be. He and his children will suffer the ugly consequences of climate change that are so connected to the increase of CO2 from fossil fuels having failed to implement policies that would convert to cleaner, renewable energy sources sooner. We’ll all be getting a demonstration of this as Hurricane Sandy makes it way along the East Coast. It will start to come inland today and meet another massive storm, becoming what weather forecasters are calling a “frankenstorm”. This monster storm that will impact anywhere between 50-60 million people has possible climate change links from global warming.

The climate change link may be more than just more precipitation. A 2010 study found“Global warming is the main cause of a significant intensification in the North Atlantic Subtropical High.” Climate Central’s Andrew Freedman explains a possible influence:

Recent studies have shown that blocking patterns have appeared with greater frequency and intensity in recent years….

While it is not unusual to have a high pressure area near Greenland, its intensity is striking for this time of year. As Jason Samenow of the Capital Weather Gang wrote on Wednesday, the North Atlantic Oscillation, which helps measure this blocking flow, “is forecast to bethree standard deviations from the average — meaning this is an exceptional situation.”

I don’t want to disrespect anyone’s decision on why they are voting for the candidate of their choice but I would find greater respect for those who do so for more concrete reasons based on careful study and conviction of beliefs. In E.A. Bucchianeri’s novel, Brushstrokes of Gadfly, his fiery, idealistic heroine Katherine makes this observation:

“…they say if you don’t vote, you get the government you deserve, and if you do, you never get the results you expected.”

As important as voting is in a democracy, it is informed voting that will garner better results and ongoing participation in the political process that ensures any likelihood that you’ll get the government you expected.

There will never be an ideal candidate that meets each person’s criteria and values and the 30-second ads during the campaign are not aimed at informing you about what you need to know. Democracy is a group effort and one that extends beyond the voting booths. Voting for or against someone because you don’t think he is American enough, or christian enough or hasn’t provided a silver bullet to make everything better is unfair to those of us who have studied the candidates and make choices based on the realties of this world as we best see them.

” … if describing what you want to see happen without providing any specific policies to get us there constitutes a “plan,” I can easily come up with a one-point plan that trumps Mr. Romney any day. Here it is: Every American will have a good job with good wages. Also, a blissfully happy marriage. And a pony.” Pulitzer prize-winning Economist Paul Krugman

To emerge out of one’s emotional cocoon and make a long-term decision that comes from plutocratic influences and narrow ideological views is a fear that the framers had immediately following the days this country joined the world as its first democratic-republic. To make a farce of it is to shame us all with those people around the world today who so desperately want to experience what it is like living under anything other than an iron fisted ruler.

Six Facts About Mitt Romney’s Plan

Posted by lbwoodgate in 2012 Presidential Elections Tags: Barack Obama, choosing a candidate, Donald Trump, Henry Paulson, myths we take to the voting booth, Orly Taitz, political realities and fantasies, Romney, uninformed voters, Wall Street

12 comments

Can I Sell You Some Cheap Ocean Front Property in Yuma?

October 15, 2012

Hey young people! A word of caution for those taking the bait being offered by the Romney/Ryan plan to Privatize Social Security & Medicare

After being laid off in the fall of 2009 and concluding that at age 61 I was not going to get rehired in the severe recession competing with 5 other applicants, I decided instead to take the money in my 401k I had earned over the last 18 years, pay off all of our bills except the mortgage, roll the remainder into an IRA and go into to semi-retirement. I figured I could find some part-time work that would allow me to have a little spending money and within a couple of months I would be eligible to collect early Social Security benefits. I’m thankful my wife still has what seems to be a secure job as a registered nurse for the local school district because with both of us out of work this could have gone south real quick. Luckily too, both of our adult children are out on their own and are doing relatively well for the time being. It wasn’t what we planned for our lives but then things seldom work out the way you want.

We were more fortunate than a lot of people who found themselves unemployed in this Great Recession. I know, I know. The recession is actually over and we’re waiting for the job situation to recover. Wall Street is making record profits but Main Street has yet to fully recover. We could have been one of those poor souls that lost their home and health care coverage along with their jobs. But a monthly stipend from my IRA and $1500 a month in Social Security benefits along with my wife’s salary allows us to maintain the resources we need to remain solvent. Now if our luck and what savings we have will only last until we die.

Until earlier this year I was able to afford health insurance by adding myself to my wife’s benefit plan. But that changed when the school district replaced the insurance provider to keep costs down after state funding started drying up from the budget planning failures of Texas state legislators. The deficit the state faced last year “was created by a deal to lower property taxes while transforming the state’s business tax. It has never generated as much money as expected.”

When the new policy raised premiums and deductibles while lowering benefits, it became a financial impracticality to pay nearly $400 a month to keep me on it. This was my mothly premium but the new policy didn’t cover expenses until I cleared a $3000 deductible. I have instead been tucking a large part of that money into a separate account and using it sparingly until I am eligible for Medicare late next year. We keep our fingers crossed that a catastrophic health crisis doesn’t occur before then.

But I digress. The point I want to make here is to alert Americans, especially those in their twenties, thirties and forties, to view with suspicion the Romney/Ryan plan to privatize Social Security and make Medicare a voucher system. Despite Paul Ryan’s claim as being “indisputable fact” that bankruptcy for both of these safety net issues are inevitable, evidence by more rigorous authorities say nothing could be further from the truth. According to information put out by The Progress Report

[T]he possibility of Medicare going bankrupt is — and historically has been — greatly exaggerated. In fact, if no changes are made, Medicare would still be able to meet 88 percent of its obligations in 2085. Social Security is fully funded for another two decades and could pay 75 percent of its benefits thereafter. There is also an easy way to ensure the program’s long-term solvency without large changes or cuts to benefits.

What is an indisputable fact is that these programs that were instituted to keep more people out of poverty and serve as a means of last resort for people who fall between the cracks in our economy have been attacked by wealthy financial interests since their inception. In his book, The People’s Pension, Eric Laursen has detailed how specific politicians, lobbyists, and groups “have waged a steady battle to discredit and undermine” Social Security. They have aggressively pushed proposals to cut, privatize or dramatically transform” this trust fund for elder citizens.

Wall Street has been trying to get their hands on the billions in the Social Security trust funds for years. They assure us that putting your money into the stock market will see greater returns than what you’ll see after decades of payroll deductions applied to the government-managed system that has reliably paid benefits for more than 75 years. In his article, The Solvency of Social Security, Stephen J. Foster, Jr. points out what should be an obvious fact even to the casual observer.

Wall Street is known for gambling with other people’s money which has led to the Great Depression in the past and the 2008 recession. If you have a 401(k), you have experienced firsthand what can happen to your retirement portfolio when it is entrusted to Wall Street. People with IRA’s, 401(k)’s and other types of retirement accounts watched helplessly their savings disappear as the stock market took a historic tumble.

After clearing most of my debt and depositing the remaining $140,000 from my 401k into my new IRA on January 1st, 2010, the DOW was sitting at 10,428.04. Last Friday it closed out the week at 13,328.85, which was down 281 points from what it started at the beginning of the week. The DOW has gained just over 2900 points since I opened that IRA. My investments were primarily low risk investments. However, when things really started looking bad after Republicans refused to raise the debt ceiling in 2011 and the country’s credit rating was lowered as a consequence of this dysfunctional action, I shifted everything into the safer areas of bonds and money markets.

We all know the stock market is volatile and that there will be ups and downs but even with my safe investments that were being handled by a professional money management agency I have lost roughly 4% of my overall investments into the stock market from the time I opened my IRA account. Clearly Wall Street has done well while my resources are losing ground.

A 4% loss over three years isn’t much when you are just beginning your life and putting some away in your twenties or thirties but for those of us who are at retirement age or getting close to it such losses hurt, especially as your health deteriorates from age and the costs of health care and insurance increase faster than the rate of inflation.

Ups and owns in the stock market are expected but over a 40-50 year period you can realize significant gains. But when our economy takes serious hits like it did in 2000 and 2008 people like myself watched their 401k’s take tremendous losses. My 401k lost a third of its value in each recession. I never did fully recapture those losses before I was laid off in 2009.

I worked 18 years building up a retirement fund and under normal circumstances would have accumulated about $350,000 at the rate I was going. Instead, because of two economic recessions within 8 years of each other where the DOW lost more than half of its value nine months before I was let go, I wound up with less than half of that. How much more would I and others have lost if the economic crisis reached Great Depression levels? Perhaps all of it.

The only people who really do well in the stock market are very wealthy people who can afford to take the losses that occur when hard times hit. The average investor is likely to suffer irreparable economic consequences at the most vulnerable times in their life as an aged retiree. Stephen J. Foster rightfully points out that once the wealthy financiers get their hands on your money they offer no guarantee that you will come out ahead. In fact, in rough times when markets are down, as your investments dwindle they lose very little because they are using your money to gamble with.

People like Romney and Ryan like to tout the notion that people can do better when they manage their own money but they would be hard-pressed to find evidence of that with most people who work all their lives. Unless wages allow enough to stick aside most people live from paycheck to paycheck to make ends meet. And we all know wages for 95% of wager earners have not kept pace with the top 5% over the last 30 years.

If the payroll deductions for Social Security and Medicare were eliminated low and middle-income families would indeed have a little bit more money in their pockets but it wouldn’t necessarily go into a savings or a retirement plan in an economy where prices are rising faster than most people’s wages can keep up with. As much as it may hurt during those times when families are struggling to provide basic essentials for themselves, without the deductions going toward future social security benefits and health care coverage, adult children would suffer even worse, especially during economic hard times, when faced with caring for their aging parents down the road.

So I would ask all those young people who Mitt Romney and Paul Ryan are appealing to – are you willing to risk this small percentage of your earnings each payday in the uncertainty of a volatile market or put it towards a financially secure, long-term investment? If you opt for those markets, how much time and energy do you think you will have to make sure your investments are as sound as they can be? When even professionals fail to read the tea leaves in the markets each day, how much better will those of us with an untrained eye do making such decisions?

When asked in a recent interview “Why should younger people of lower- and middle-incomes be especially concerned about Social Security?” Eric Laursen conveyed the following:

So many of their traditional sources of retirement income are eroding. Millions of younger workers will not be able to rely on employer-based pensions or from sales of their homes. Also, the stock and bond markets, which were supposed to be a vast new source of wealth through 401(k)s and IRAs, are treacherous. Health insurance costs and student loan payments eat away at what savings they’ve managed to acquire. Employment itself is a lot more volatile. Social Security is the one thing they have that is guaranteed. SOURCE

It’s a pipe dream to believe that the volatile stock market offers more security for the average working American than a secure fund backed up by the full faith and creditof the U.S. Treasury. One that wealthy investors want you to believe in order to increase their own capital wealth. By itself it will not meet all the creature comforts many people are used to but for an average worker, Social Security replaces about 40 percent of annual pre-retirement earnings, constituting about two-thirds of income for the average older beneficiary. Even more revealing is the fact that Social Security amounts to 90 percent or more of the income for one-third of seniors.

Making the government look like a bogey-man on this issue is part of a deception to extract even more of the remaining wealth from the 98% so when they lose their life savings and have to fall back on vital government assistance programs, they can be accused by people like Romney of being “dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them” rather than accepting responsibility for the failure to be honest with the American people about the risks involved with privatizing Social Security and Medicare.

Social Security is Under a Fierce Attack From Wall Street

Top Ten Lies About Social Security

The great Social Security lie

Historical Background and Development of Social Security

Posted by lbwoodgate in Medicare/Medicaid, Society and Politics Tags: 401(k), future of social security and medicare, Individual Retirement Account, Medicare, Paul Ryan, privatizing social security and medicare, Romney's 47%, social safety nets threatened, Social Security, Wall Street

9 comments

“All I Want is the Right to Live, Mister”

August 15, 2012

I think voters need to step back and take a serious, measured look at what our real choices are for President this fall. Hard working Americans who have become victims of this recession are not dead beats looking for a free lunch. They see their plight as temporary but would feel better about it if there was some genuine empathy from one of the candidates who could be President but appears to have no idea what it’s like to be struggling economically when times are hard.

While corporate profits reach record highs, wages remain stagnant

The high unemployment rate that just refuses to recede back to that 4-5% rate that most economists view as the norm continues to drain savings accounts, puts families out of their homes and clearly brings into perspective that the idea of an American dream is no longer a reality for most people as it once was. More people have slipped from middle incomes levels into the ranks of poverty as a result of the financial collapse on Wall Street back in 2008.

As a consequence, the need for state and federal aid has grown in the form of unemployment benefits, food stamps and Medicaid benefits. Older workers are discovering how difficult it is to find comparable work that they once held before being laid off and are often forced to collect Social Security benefits at the earlier retirement age of 62, putting an added burden on that trust fund when receipts are shrinking from fewer income earners in the job market.

This isn’t a condition any of these people sought or feel comfortable with. It is taxing and humiliating on individuals to go through the paperwork and expend the time applying for benefits while simultaneously trying to compete with 4-5 other people looking for that one job that will put them back in the work force. Many have put off taking such action until there is nothing else left for them to do after they’ve emptied their savings, sold their home and moved in with relatives, all while cutting back on food and health needs to sustain them. It is a depressing state that has a deteriorating affect on their physical health, leading to greater economic woes for them and their family.

Nobody wants what Paul Ryan recently suggested about having “a safety net that turns into a hammock that lulls people into dependency in this country”. That’s a fear smear used by the political right to mischaracterize necessary welfare programs in this country that fill the void when free markets fail. All anyone really wants now as they did during the Great Depression was “the right to live, Mister, Give me back my job again.” Jim Garland’s 1941 lyrics to All I Want was part of the social protest movement expressed in the music of the Almanac Singers that consisted of Garland, Wood Guthrie and Pete Seeger

We worked to build this country, Mister,

While you enjoyed a life of ease.

You’ve stolen all that we built, Mister,

Now our children starve and freeze.

So, I don’t want your millions, Mister,

I don’t want your diamond ring.

All I want is the right to live, Mister,

Give me back my job again.

Charities of every kind are over-burdened with the needs to meet this new population who just a few short years ago were themselves contributing to food banks, work programs and life support organizations that routinely meet the needs of society’s poor and disenfranchised groups. As a society we are just not wired to become dependent on others, looking for a “free lunch”, and will go out of our way to avoid relying on the kindness of strangers.

It would be nice then if the presumed Republican nominee for president, Mitt Romney, would stop disparaging these people, portraying them as a “culture of dependency” and showed some empathy by ending his demeaning narrative towards those policies and programs that offer some solace in these economic hard times until the promises of the free markets correct what they essentially caused. Without some government assistance at this time, this doesn’t seem likely anytime soon. Paul Ryan’s entry into the race as Romney’s VP will have no affect on this dynamic. It will in fact bring it more into focus since Ryan is the poster boy for wanting to privatize Medicaid/Medicare.

“There is no such thing as a free-market. A market looks free only because we so unconditionally accept its underlying restrictions that we fail to see them.” – economist Ha-Joon Chang

In order for the “invisible hand” of the free markets to work its magic, more people will likely lose their homes, their savings and their hopes of an ideal American dream first . Unfettered markets will rely solely on the forces of supply and demand from the private sector to revive the economy. Without government stimulus to generate demand and speed up the recovery, those currently unemployed will have to hope that a high level of entrepreneurship springs into action quicker rather than later. The prospects for that happening soon are not promising.

And while waiting for this to occur the victims of the great recession are finding it more difficult to rely on state and federal assistance to tide them over. The free markets do not accommodate families struggling who are waiting for the “job creators” to provide employment opportunities. This puts them deeper in debt and prevents them from rejoining the ranks of consumers if they are mostly reliant on private charities.

If people are not buying then demand is weak and employment either remains the same or shrinks, creating even less demand needed to turn the unemployment crisis around. Thus the new unemployed population that developed when the banks too big to fail went under have to hope that the failed premise of trickle down economics Romney and Ryan offer will deliver this time where it hasn’t in the past.

The deck remains stacked in favor of Wall Street. A Romney Presidency will gain them a card dealer who deals to them from the bottom of the deck.

President Obama has been criticized by apostles of supply side economics for his use of the Keynesian approach requiring government intervention during economic hard times. These efforts were effective in stopping the rapid rate of job losses and even began to turn the tide shortly after being applied. But the stimulus package passed by Congress shortly after Obama’s inauguration, without any Republican backing, was too little for an economy that had deeper issues than nearly anyone on either side predicted.

As a result, the Republicans exploited this short-sightedness and portrayed it as a failure of policy, even though they battled to insure its failure. Angry voters who watched Washington bailout Wall Street while Main Street went under easily bought in to the straw man offered by forces eager to regain their prominence under the neo-conservative policies of the Bush/Cheney days

Acting behind the scenes to promote the anti-government, anti-tax fervor of the small libertarian contingent in this country which came to be known as the T.E.A. Party, they repackaged trickle down economics in a thinly veiled manner that allows even greater revenue loss to prop up the social safety net that is saving millions from falling deeper into debt and poverty. While middle-income families who still have a job are led to believe that it is the expense of maintaining this social safety net that’s causing their economic concerns, the wealthiest amongst us are getting richer from lower taxes and less regulation to keep their greed in check.

This is the select group of people who Mitt Romney comes from and Ryan supports to the detriment of the middle-income victims of failed free-market policies. The gaffes Romney makes and continues to make about the working class in America and his feigned concern for them is becoming legendary. Yet he retains a modicum of persuasion over those who will ultimately be adversely affected by his hoped-for victory come November because of a level of hate for Obama that can’t be rationally explained. In the end however this may not save him because Romney still lives in a fog about his own culture of wealth as writer Jonathan Chait has noted.

Romney has taken no steps at all to put a middle-class sheen on his background, and he’s allowed Democrats to define him by his wealth and heartlessness. He seems to have fallen into the trap of believing that the sentiments about wealth that prevail among movement conservatives reflect the beliefs of Americans as a whole. SOURCE

Polls are clearly showing that this may well work against the presumed GOP nominee for president. Not only do more people like Barack Obama than they do Romney, they also don’t identify with his wealth culture. It remains to be seen if Ryan’s inclusion into the Romney campaign will alter these poll results more in favor of the man who continues to demonstrate his failure to connect with the average American.

So why are those Independents who will eventually decide the outcome of this election still waiting to make their choice? Obama has understandably been disappointing for not being more aggressive going after the culture of greed that caused our current state of affairs and has been too willing to compromise with people who have made it clear that compromise is itself a dirty word. The GOP has focused on this weak aspect of his leadership to undermine the president in all things. But the choice between Obama and a man who has no clue what it’s like to be unemployed and struggling to meet the daily needs to survive seems like a no-brainer.

It’s not that wealthy people are automatically out of touch with poorer working class families. Not all of them are. In his inaugural address John Kennedy warned that “If a free society cannot help the many who are poor, it cannot save the few who are rich.” But Romney clearly showed his ignorance of poverty in America when he implied at Otterbein University in Ohio earlier this year that financial success was simply a matter of “borrowing money if you have to from your parents”.

Reinstating Obama means we will still at least have a sympathetic ear and a foot in the door to accomplish greater things we were led to believe would come to fruition shortly after his inauguration. He will remain in place to block any draconian measures by a GOP-controlled House or Senate that attempt to severe necessary benefits for the most vulnerable in our society – the elderly, children and the handicapped.

For all his misgivings in his first term they still remain outdone by what he did achieve. Obama is likely to be more receptive to the change we still need in Washington in his second and final term as President. This may not inspire the hope for many that voted for Obama in 2008 but it remains a lifeline for working families and the indigent poor.

That door slams shut however if Romney is elected. The alternative of a Romney/Ryan ticket promises to return the status quo view of economics that sent markets dropping like lead balloons four short years ago. The only form of hope likely to be left then for most Americans will be that their lottery numbers hit and trickle down economics will at least contribute more to the foods banks and free health clinics.

“It is really not so repulsive to see the poor asking for money as it is seeing the rich asking for more money.” - G.K Chesterton

RELATED ARTICLE:

Five Reasons Why Crisis Persists

Posted by lbwoodgate in 2012 Presidential Elections Tags: Barack Obama, class warfare, culture of dependency, culture of wealth, free lunch, haves vs. have-nots, Jonathan Chait, Mitt Romney, Obama, Republican, social justice, social protests, Wall Street

11 comments

If Assisting the Economically Deprived is Immoral Then Jesus Was a Pimp

June 13, 2012

“Nor was there anyone among them who lacked; for all who were possessors of lands or houses sold them, and brought the proceeds of the things that were sold, and laid [them] at the apostles’ feet; and they distributed to each as anyone had need.” - Acts4: 34 &35

When early christian communities formed and they shared equally all their worldly possessions, who would have thought that this gesture would be viewed by some as a source of immorality. The notion that we all share much in common has a tradition that goes back beyond the time of the gospels but which has been slowly eroding since corporate personhood came into being back in the 19 century, making a handful of people very wealthy. Laws protecting their monopoly on wealth were successfully challenged at the end of that century and into the early decades of the 20th century.

But a hundred years later we are once again battling those elite few who would re-establish those conditions where people who work hard and play by the rules often find themselves on the opposite side of forces that control law making bodies and the courts. As a result, the disparity between the wealthiest and everyone else has grown significantly and more people are now finding themselves at or below poverty levels as the middle class slowly shrinks.

In his recent column, conservative economist Walter E. Williams attempts to make a case linking immorality to our current economic crisis. Though I would agree that the behavior of some that created our current crisis was deplorable and immoral, I would not be fingering the same people who Mr. Williams seems to be.

Like a broken record, Mr. Williams repeats a theme that he has hit on many times in his columns. He insists that the social contract the people have made with their government to provide for the weakest amongst us is akin to theft. Yet poll after poll seems to reflect the opposite and have most Americans in support of a payroll deduction that helps fend off poverty for those elderly, small children and handicapped individuals in our society that tend to fall through the cracks of a free market economy.

Greed Trumps Need

Without any regard for the recent actions of those who inhabit Wall Street and who carelessly risked the fortunes of many Americans, sending the global economy into a downward spiral, Walter Williams wants to prop up the red-herring about entitlement programs and their existence for being the source of immorality in our country. To Mr. Williams it’s the government who has robbed us of our jobs, homes and savings. The financial captains of Wall Street are mere victims of some invisible hand of the market and need to be protected against the regulations of government put in place to prevent abuses with our money. Yet another misperception by Williams and the libertarian theology he subscribes to.

Williams seems to be oblivious of the human element of greed that permeates much of the financial private sector and like many who support his ideological view, is convinced a strong ethical character pervades corporate America. To concede that greed by a few rather than need by many is the main factor in this country’s moral demise would be counter productive to the laissez-faire view that people like Williams hold. Greed in laissez-faire terms is just another name for fulfilling self-interests that motivate people to seek financial gain for themselves believing that society as a whole will also benefit. To people like Williams, Milton Friedman and Ayn Rand, the Gordon Gecko character in the movie “Wall Street” would be seen as a heroic figure.

But as Harvard professor Michael J. Sandel points out in his book on justice “Greed is a vice, a bad way of being, especially when it makes people oblivious to the suffering of others. More than a personal vice, it is at odds with civic virtue.(emphasis mine) In times of trouble, a good society pulls together. Rather than press for maximum advantage, people look out for one another. A society in which people exploit their neighbors for financial gain in times of crisis is not a good society. Excessive greed is therefore a vice that a good society should discourage if it can.” (Justice: What’s the Right Thing to Do? p.7)

Yet Williams never seems to point out the lapses in moral behavior by the bankers and wealthy investors within society and instead goes after a system that benefits those who are often the victims of greed. In doing so he makes a good case I think that calls his own morality into question.

One in five in poverty: 14.7million – or 20 per cent – of children in the U.S. live in families with incomes below the federal poverty level

In his book, “Justice: What’s the Right Thing to Do” Sandel points out a difference between two opposing views. One from the libertarian, laissez-faire side; the other from an egalitarian frame of reference:

“ … some of the most hard-fought political arguments of our time take place between two rival camps within it — the laissez-faire camp and the fairness camp. Leading the laissez-faire camp are free-market libertarians who believe that justice consists in respecting and upholding the voluntary choices made by consenting adults. The fairness camp contains theorists of a more egalitarian bent. They argue that unfettered markets are neither just nor free. In their view, justice requires policies that remedy social and economic disadvantages and give everyone a fair chance at success.” (p. 20)

Williams plants himself firmly in the laissez-faire, libertarian camp, whose approach to social issues rests primarily on the premise that “markets promote the welfare of society as a whole by providing incentives for people to work hard supplying the goods [and services] that other people want”. (Justice p.6) How exactly small children, the elderly and the mentally and physically handicapped are fairly represented in this scheme is ignored by people who think like Williams, unless of course we want to exploit them despite their limitations.

In contemplating whether are not Americans today are virtuous and moral he focuses almost exclusively on those who support taxing all wages to support Social Security, Medicare and Medicaid and how it accounts for nearly half of federal spending. Revealing as he does that monetary considerations outweigh social responsibility, Williams seems willing to allow suffering and depravations that accompany poverty. To me, this raises a moral qualm.

This notion is hit upon in Sandel’s book:

Taken to it’s extreme a libertarian’s “idea of self-ownership, consistently applied, has implications that only an ardent libertarian could love – an unfettered market without a safety net for those who fall behind; a minimal state that rules out most measures to ease inequality and promote the common good; and a celebration of consent so complete that it permits self-inflicted affronts to human dignity such as consensual cannibalism or selling oneself into slavery.” (Justice p103)

Charitable Giving

Williams would likely inject that charitable organizations would fill the gap where free market economies fall short. Though I agree that charitable organizations fulfill a great need, I am not as naive as he appears to be to think that such personal choices suffice to meet critical economic deprivations in this country. If this practice alone were sufficient to temporarily provide for those who fall between the cracks and find themselves destitute through conditions beyond their control, then the need for federal programs aimed at this population would likely never have arisen.

The fact is though that individual charities fall way short of meeting the needs of a growing population who lack the resources within a free market society to provide basic essentials for themselves and their families. When economic hard times occur as they often do, charities are pressed harder to provide not only for those who lack the means to actively participate in our economy due to age and physical limitations but also to fill the void at times when more people who can find themselves unable to when jobs dry up.

To add insult to injury, recent testimony from Frank J. Sammartino, the assistant director for tax analysis from the Congressional Budget Office shows that though the wealthiest give slightly more of their income to charitable organizations, only 4% of that goes to organizations devoted to helping meet basic needs while those who make below $200,000 give on average about 11%. The wealthy tend to give significantly more to health and education organizations. Institutions that they and their progeny can benefit from over other charitable organizations. Would billionaire David Koch have given over $500 million to cancer research had he not been diagnosed with prostate cancer back in 2004?

The Side Benefits of Public Programs

In the documentary “The Corporation”, Noam Chomsky points out the side benefits of public institutions, even when they run at a loss.

Public institutions … may purposely run at a loss because of the side benefits. So for example if a public steel industry, runs at a loss, it’s providing cheap steel to other industries. Maybe that’s a good thing. Public institutions can have a counter-cyclic property. So that means that they can maintain employment in periods of recession, which increases demand, which helps to get us out of a recession.

I bring this up here because the argument that spending in the public sector is always detrimental to our economy is not an absolute. In providing health care services to those in our society that have fallen through the cracks, even if it’s done at a loss, there are counter-cyclic advantages to this. Without federal aid in the form of Medicare and Medicaid most low and middle-income families would be hard pressed to provide the time and financial means to support a handicapped child or a spouse with a long-term illness or an aging parent who needs assisted living care. Without unemployment benefits able workers would find themselves deeper in debt before regaining employment. Their productivity at work could suffer from their need to deal with these issue monetarily and emotionally and those lost hours will have a negative effect on our economy.

And then there of course are those, especially the elderly, who have no family to speak of to assist them in their time of need. What are to be done with such people? A humane society will have to pay for their care but will they do so at a level that respects these disadvantaged souls or simply warehouse them and treat them as unclaimed freight?

Virtue Has No Self-Interests

Our system of entitlements in this country is a mark of a civilized society that seeks to remedy the shortfalls of our free market economic system. There are areas we can address that will reduce costs for necessary programs like Social Security, Medicare and Medicaid but they don’t have to reduce essential care for those who can’t afford what “the greatest health care system in the world” makes available for financially successful people. We can eliminate fraud within the private sector that costs billions each year, initiate some means testing, eliminate unnecessary medical tests that have been proven ineffective and notch up the rate people are taxed on to pay for these benefits.

The germ that infects the thought of people who feel they are unduly burdened to provide for the powerless in this country have a convenient view of morality that ignores the consequences of their actions. Once this germ infiltrates so deeply into the social mindset of a people, virtue suffers a blow. Securing individual wealth to the detriment of those who find themselves outside the means to provide for themselves may be “naturally” appealing to many but to assert it has greater moral value is a fundamentally flawed philosophy.

“We are not rich by what we possess but by what we can do without.” - Immanuel Kant

Economics and Morality: Paul Krugman’s Framing

Healthcare and Scalia’s Broken Moral Compass

Posted by lbwoodgate in Medicare/Medicaid, Social Discourse Tags: egalitarianism, federal aid for the poor, greed vs. need, justice, Laissez-faire, libertarianism, medicare/medicaid, Michael Sandel, Milton Friedman, morality in america, social safety nets, Wall Street, Walter E. Williams

11 comments

Misplaced Meritocracy

March 27, 2012

A recent contributor to the “Letters to the Editor” column in my local newspaper proposed a concept that clearly lacked critical analysis. It associates itself with laissez faire free marketers who view wealth as an important measure for gauging purpose and value to one’s life. Included in this notion is the added concept that certain rights and privileges should come to those who “have more to risk”. This is “free market speak” for those who possess the greatest wealth.

In the letter, the writer starts off on solid ground

The ultimate expression of fairness in our society is the concept of one person, one vote. It is the great equalizer or leveler of people. No matter how much money you have, your vote counts just the same as the homeless person. That’s as it should be.

But then he begins to take a hard right to the notion that this concept can be played out equally in other social systems.

But if that holds true for voting, why shouldn’t it hold true for income taxes: one person, one tax. That way every person has skin in the game, as they say.

As a percentage, the more you make, the more you pay, but the percentage each person pays on income is the same for everyone or true equality.

Conversely, if a progressive tax system is so good, maybe we should also have a progressive voting system.

The more you make, the more you have at risk, thus the more voting power you should have.

I could challenge his notions about a “flat tax” but my interest in his comments lie with what appears to be a distorted version of a meritocracy. One that presumes people of wealth are necessarily the most qualified to make choices for everyone else. In a true meritocracy talent and ability makes one exceptional, not their class or wealth. But what’s being suggested here is that we reward the wealthy by giving them more power because somehow they have earned that right.

There’s definitely a need for a truer application of meritocracy within government. Some presidents and state executives have done a better job instilling qualified leaders in their positions than others. President Obama’s recent appointment of Dr. Jim Yong Kim to head the World Bank appears to be a good example of filling a critical role with the right person. Bush’s appointment of Michael Brown to FEMA in 2003 is a tragic example of meritocracy’s absence. But as a form of government who some seek to replace our democracy, human limitations and weaknesses are also sure to diminish this system of efficiency.

“The more you make, the more you have at risk”, our letter writer rationalizes. Wealthy people however are often more clever than they are intelligent, thoughtful people and have been known to engage in unethical behavior to accumulate their wealth. In conjunction with this is the central principle of laissez faire thinking, where people always do what is in their own self interests. Not exactly a prime consideration for someone you want making decisions that affect us all.

To get a sense of how some acquire their wealth in socially unacceptable ways, one only has to read Greg Smith’s recent Op-ed letter in the NY Times explaining why he left a lucrative career at Goldman Sachs after investing twelve years of his life there. “I believe I have worked here long enough” Smith tells us, “to understand the trajectory of its culture, its people and its identity. And I can honestly say that the environment now is as toxic and destructive as I have ever seen it.”

I hope this can be a wake-up call to the board of directors. Make the client the focal point of your business again. Without clients you will not make money. In fact, you will not exist. Weed out the morally bankrupt people, no matter how much money they make for the firm. And get the culture right again, so people want to work here for the right reasons. People who care only about making money will not sustain this firm — or the trust of its clients — for very much longer. SOURCE

Focusing on others more than self is the hallmark of both good business and government leadership; something that was missing in both leading up to the great recession of 2008.

In his scathing indictment of wealthy bankers back in February, 2011 Matt Taibbi reminds us how the economy began to tank as a result of the financial meltdown that was ignited by Wall Street greed. “Virtually every major bank and financial company … [was] embroiled in obscene criminal scandals that impoverished millions and collectively destroyed hundreds of billions, in fact, trillions of dollars of the world’s wealth — and nobody went to jail.”

TIME magazine listed those who were behind this failure and everyone of them had acquired great wealth in part or in whole from those obscene criminal scandals. They were aided and abetted by those in government who relaxed or removed the regulatory oversight that had been set up years ago to prevent this very thing from happening again. Wealth, therefore, clearly doesn’t earn someone a special right to have a greater say in how our government operates.

I would point out too that there is this idealized vision of ardent capitalists who insist that incorporated within the free-markets principals of capitalism is a control measure called “the invisible hand”. It is deeply held by some that the invisible hand of the free-market will prevent excessive greed by those humans who practice these principles. Ideally, competition between producers and providers of goods and services would ultimately work to benefit socially desirable ends, even though their goals were not intended for this purpose.

This might have made sense to Wealth of Nations author Adam Smith and men of commerce back in the 18th century, thinking as they might that honorable people would always dominate the ranks of those in commercial enterprises. But in today’s world of multinational corporations and banks “too big to fail”, the invisible hand of the free markets is often found stuffed in the pockets of trusting but gullible investors and most consumers while making monetary deposits in the campaign coffers of willing politicians. When “honorable” men and women in the corporate world do condemn such practices today, most it seems usually do so after the fact and with only ineffectual reprimands against those who have been caught.

What seems to be lost on this letter-to-the-editor writer, or what he’s willing to ignore, is that the wealthy already have a greater say in how government runs and how it does so to the advantage of the privileged one-percent. Their people in the Supreme Court have already allowed money to serve as free speech’s equal following their decision in Citizens United vs. FEC and behind closed doors there exists the American Legislative Exchange Council (ALEC), the corporate-funded entity that works to “hand state legislators the changes to the law they desire that directly benefit their bottom line.”

The value of a true meritocracy has been lost on those died-in-the-wool defenders of capitalism. Crony capitalism has served as a substitute for those who truly have the skills and talent to run government where it ably serves all of its citizens. The norm we’re left with are those political office holders and corporate lobbyists who interchangeably go from public sector jobs to private sector positions and back again, making the rules that we all have to live by while they become independently wealthy and secure from legal persecution.

In a corporate version of meritocracy the only criteria to advance and distinguish yourself is to acquire more wealth than the fellow in front and back of you. Your major skill asset is your ability to keep pace with this goal lest you get overrun from behind.

Posted by lbwoodgate in Corporate Influence Tags: corporatism, Free market, Goldman-Sachs, Invisible hand, Laissez-faire, Matt Taibbi, meritocracy, plutocracy, self-interests, Wall Street

7 comments

They Live In a World of Their Own

March 9, 2012

Much has been talked about concerning the disconnect that GOP presidential candidate Mitt Romney has with the average income earner in this country. His gaffes are now legendary and have become grist for late night comedy and for political left wing websites and blogs who aim to cast him as the wealthy elitist he is; not fit to represent the 99% whose incomes average just under $50,000 a year.

Some who support Romney and his accumulation of great wealth claim that this does not disenfranchise him from most Americans or protest that this charge is an exaggeration. The aspirations to have such great wealth may be a common denominator amongst most free market minded people but the reality is much more in tune with the facts that reveal only a small percentage of Americans will ever acquire such great wealth.

To drive this point home, a recently published article in Bloomberg has demonstrated how people like Romney with their greater wealth actually live in a world that many others may dream of but few live in – the world of the wealthiest 1%. If ever these people at anytime in their life ever experienced the struggles most people face, especially in such tough economic times as these, they have surely removed them from their consciousness. Their understanding of the world we live in is molded by what they read in Barron’s, The Wall Street Journal, the financial sections of major newspapers at the NY Times and The Washington Post and even Bloomberg’s that reported a despairing situation for many Wall Street income earners.

The fact too that some of these people have to side step a homeless person sleeping in front of the entrance to their Wall Street office is more a nuisance to them than a reminder that few of their fellow citizens really do lead the lives they do. But now some who have lived luxurious lifestyles may be getting that sense of desperation that their lower-earning brethren deal with each day as job security and wages seem to slip away for many, if only temporarily.

Facing a slump in revenue from investment banking and trading, Wall Street firms have trimmed 2011 discretionary pay. At Goldman Sachs Group Inc. (GS) and Barclays Capital, the cuts were at least 25 percent. Morgan Stanley (MS) capped cash bonuses at $125,000, and Deutsche Bank AG (DBK) increased the percentage of deferred pay.

Wall Street’s cash bonus pool fell by 14 percent last year to $19.7 billion, the lowest since 2008, according to projections by New York state Comptroller Thomas DiNapoli.

“It’s a disaster,” said Ilana Weinstein, chief executive officer of New York-based search firm IDW Group LLC. “The entire construct of compensation has changed.” SOURCE

Do you feel the pain for people like those at Morgan Stanley who can rely on getting no more than $125,000 for their bonuses? No, neither can I. $125,000 is two and half times the average income for most Americans.

Most people can only dream of Wall Street’s shrinking paychecks. Median household income in 2010 was $49,445, according to the U.S. Census Bureau, lower than the previous year and less than 1 percent of Goldman Sachs CEO Lloyd Blankfein’s $7 million restricted-stock bonus for 2011. The percentage of Americans living in poverty climbed to 15.1 percent, the highest in almost two decades.

The sacrifices some of these well-healed people are faced with will bring you to tears. Not for what they will be doing without but for the simple reason that they haven’t got a clue that such wants and desires they’ve become accustomed to don’t even begin to exist in the world of families that strive to feed their children two nutritious meals each day, keep the utilities on so they won’t freeze in the winter and swelter in the summer and who have little to no hope that college for their kids and a comfortable retirement lies in their futures.

Some examples, described in Max Abelson’s story in Bloomberg, of how these wealthy people view their futures are like that of Andrew Schiff, director of marketing for broker-dealer Euro Pacific Capital Inc who makes a salary of $350,000 before bonuses but is now fretting that he will not be able to cover the bills to pay for “his family’s private-school tuition, a Kent, Connecticut summer rental and the upgrade they would like from their 1,200-square- foot Brooklyn duplex.”

“I feel stuck,” Schiff said. “The New York that I wanted to have is still just beyond my reach.” He seems unaware that this comment mocks the millions of people who live in ghettoes and low-rent districts, not only in New York but across the country, having expressed a similar desire to pull themselves above their utter poverty. The Schiffs of this world might blame those very poor for their own plight but as he and others of his ilk are discovering, things beyond their control effect a family’s income and the ability to fight it often bares little fruit.

And who can’t feel the pain of “Wall Street headhunter Daniel Arbeeny who averages about $500,000 in good years, when his ‘income has gone down tremendously.’ On a recent Sunday, he drove to Fairway Market in the Red Hook section of Brooklyn to buy discounted salmon for $5.99 a pound.” How degrading it must be to mingle with the “small people” who eat this more inferior grade of salmon.

But these examples are but a condition that we all face when the lifestyle we’ve become accustomed to slowly begins to fade away. The family of four who were making $50,000 a year will have to change their diets and plans for an evening at the movies or dinner out now that dad has lost his job and their sole source of income will come from mom’s paycheck as a day care worker in a local facility for the aging. But even her job is in jeopardy as the state threatens to reduce funding for this refuge of last resort for elder people who live strictly off of their meager social security checks.

What really leaps up off the page of Abelson’s article, for me at least, is the comment made by Alan Dlugash, a partner at accounting firm Marks Paneth & Shron LLP in New York who specializes in financial planning for the wealthy, when he says that “People who don’t have money don’t understand the stress. Could you imagine what it’s like to say I got three kids in private school, I have to think about pulling them out? How do you do that?”

Let those comments sink in for a minute and after the shock and anger subsides, allow the laughter and pity to take over. Dlugash’s comments point out the very factor why most of us feel that Romney’s wealth and those like him alienate them from everyday working Americans.

The wealthy one-percent feel helpless when they can’t afford to send their kids to expensive prep schools, purchase a new Mercedes-Benz or take their annual European Cruise. The rest who struggle at or below the poverty level understand that they may not be able to provide adequate health care for their kids, put gas in the ten year old vehicle that is in bad need of repair and update the clothing hand-me-downs that many siblings share with each other. But somehow, in the minds of very wealthy people, this stress is incomparable to that which would deprive Buffy and Tad from an education that is as much centered on social status as it is growth opportunities for them and their parents.

The appalling arrogance of Dlugash’s comment displays the growing division in real life terms between the have and have-nots in this country. To suggest as some have that those who support the ideas of the Occupy Wall Street people are guilty of creating unfounded class warfare is to totally miss what people like Romney, Schiff, Arbeeny and Dlugash are really all about. The comfort level they have achieved and endured for years has buffered them from most of those within the lower 99%.

To put in perspective the difference between income and wealth, consider that to be in the top 1 percent of income earners, a household needs an adjusted gross income of at least $380,000, or 11 times the median household adjusted gross income of $33,000. But to be in the top 1 percent of wealthy Americans, a household needs a net worth of almost $14 million—225 times that of the median family net worth of just $62,000 in 2009. And the richest 1 percent of Americans owns an even greater share of wealth than of income. SOURCE

They have developed a mindset that doesn’t fully grasp that their good fortune has likely been the result of the advantages that are absent in the lives of most Americans – growing up as children of wealthy parents. Charles Murray with the American Enterprise Institute points this out in his Op-ed piece in the NY Times.

“The haves in our society are increasingly cocooned in a system that makes it easy for their children to continue to be haves. Recognizing that, and acting to diminish the artificial advantages of the new upper class — especially if that class takes the lead in advocating these reforms — could be an important affirmation of American ideals.”

For those who have scratched and clawed their way to the top without the aid of a wealthy legacy it appears they too have closed themselves off to a world where opportunities are few and far between and to the strongest go the spoils.

The prospects of fulfilling that American Dream have slowly disappeared over the last few decades and as more and more wealth is accumulated in fewer and fewer hands the future becomes bleak for those children whose middle-income family upbringing offered hope for them. The fact that some of those who have reached the heights of material ownership and are now seeing that they too may soon become victims of an economic system going south seems indicative that we are indeed heading for a crisis that easily reflects a class warfare.

The attitude of these wealthy Wall Street financiers reported in Abelson’s Bloomberg piece displays for all who are paying attention that there is a different construct by which they lead their lives versus the rest of the country. The writing is on the wall for those who can read it. Clearly those like the Schiffs, Arbeenys and Dlugashes have yet to see that our futures our inexorably tied together. Their hope unfortunately lies in a leadership guided by a Mitt Romney who has never known what it’s like to be in real want and need.

Until we try to establish a system that works purposefully to insure a rising tide lifts all boats, the growing income disparity will continue and power will be concentrated in the hands of a few. These few power brokers increasingly lay outside the control measures of a democracy that is becoming more and more suited by design for their needs than “we the people” it was originally intended.

Two Points on the Bloomberg Article on Wall Street Bonuses: Rentiers and Bonus Culture

In Almost Every Primary, Romney Wins Big Among the Rich, Loses the Working-Class Vote

Welcome to the One Percent Recovery

Posted by lbwoodgate in Corporate Influence, Occupy Wall Street Protest Tags: 1 percent of wealthy Americans, advantages of wealth, Goldman-Sachs, growing up poor, growing up rich, haves vs. have-nots, income disparity, Morgan Stanley, Wall Street, wall street bonuses, wall street salaries, wealthy lifestyles

7 comments

“Taking our Country Back” … Before the Notion of Justice for All

March 1, 2012

Out of sight and out of mind by too many Americans are our fellow citizens who often find themselves on the other side of a legal system that our school children proclaim affords “justice and liberty for all”. The government that Lincoln lifted up after a major battle to preserve the union at Gettysburg is not so much these day one that is “of, by and for the people” as much as it seems to becoming one almost exclusively for those who have prioritized capital accumulation above common decency.

Debtor’s prison is something out of our history that was declared unconstitutional in the early part of the 19th century. But there is evidence it is making its return in today’s tough economic times. A report in the Wall Street Journal shows that some courts are bending the laws that prohibit debtors from being jailed

… the number of borrowers threatened with arrest … has surged since the financial crisis began. The backlash is a reaction to sloppy, incomplete or even false documentation that can result in borrowers having no idea before being locked up that they were sued to collect an outstanding debt.

More than a third of all U.S. states allow borrowers who can’t or won’t pay to be jailed. Judges have signed off on more than 5,000 such warrants since the start of 2010 in nine counties with a total population of 13.6 million people … SOURCE

The fact that some people can be thrown in prison today for failure to repay what they borrowed seems to be lost on some in our system of justice when it comes to wealthy financiers. In his now popular outing of Wall Street and their abuses that caused our financial collapse in 2008, Matt Taibbi points out an obvious fact that seems to go unnoticed by too many who focus on “government overreach” and a “liberal, socialist agenda”

Nobody goes to jail. This is the mantra of the financial-crisis era, one that saw virtually every major bank and financial company on Wall Street embroiled in obscene criminal scandals that impoverished millions and collectively destroyed hundreds of billions, in fact, trillions of dollars of the world’s wealth — and nobody went to jail. Nobody, that is, except Bernie Madoff, a flamboyant and pathological celebrity con artist, whose victims happened to be other rich and famous people.

The rest of them, all of them, got off. Not a single executive who ran the companies that cooked up and cashed in on the phony financial boom — an industrywide scam that involved the mass sale of mismarked, fraudulent mortgage-backed securities — has ever been convicted. SOURCE

Many of those executives worked for big banks like Citibank and Bank of America who were just two of those institutions “too big to fail” and that had to be saved by taxpayer bailouts after misappropriating the money they held for millions of savers and investors. These are also some of the culprits who are now engaged in debt collection practices that wound up throwing some of their victims in jail for their failure to come up with their own bailout to cover the losses.

Matt Stoller, the former Senior Policy Advisor to Rep. Alan Grayson and a fellow at the Roosevelt Institute tells us in a post of his over at naked capitalism that though consumer debt is declining, delinquency rates with those who do remain in debt are increasing.

… ten years ago, one in fourteen Americans were pursued by debt collectors. Today it’s one in seven. I suspect this number will keep going up. And though debt collection is a highly competitive field, it’s also a growth industry.

Debt collectors have been known to threaten borrowers and they do so fearlessly because there is no consequential oversight to punish these people who abuse laws that forbid them to intimidate debtors. Many victims of this practice feel helpless in dealing with such abuse.

Back in 2007 ABC News did some investigative reporting on this subject and “found [that] many unscrupulous collectors routinely ignored the law.” Taped conversations validated that abusive phone calls from collectors were being made late at night, using abusive language and threatening “to have people fired from work or thrown in jail.”

Debt collection has become a growth industry because of the vast numbers who found themselves jobless after they had already made large purchases and maxed out their credit cards and lines of credit. This is a deplorable state many people have often put themselves in but the boom in numbers following the recession where more became jobless and their prospects for finding work less likely has created a need for lenders to “farm out” their debt collecting services. The misfortunes of millions seems to have generated “job opportunities” for a certain breed within society

A large sector of this outstanding debt is property taxes. People who have unpaid property taxes are likely targets for these predators in the debt collection field. If you have lost your job then what financial resources you have at your disposal are more likely going to the immediate needs of food, gasoline, clothing and utilities. Property taxes take a back seat under these tough economic conditions and this is where our modern day publicani swoop in for the kill.

[B]ig banks and hedge funds in the U.S. have been quietly collecting taxes on hundreds of thousands of homes. The process, called “tax farming,” is simple: A company goes to a local government and reimburses it for taxes that citizens aren’t paying. In return, the company gets to act like an old-fashioned tax thug — the kind rabbis condemn in the Bible — charging up to 18 percent interest and thousands of dollars in legal fees, simply because it can. As the District of Columbia attorney general told the HuffPost Investigative Fund, there’s “no oversight at all.” SOURCE

As if this practice aimed at many disenfranchised citizens wasn’t bad enough, there is yet another category of people who are victims of debt collectors where the legal system itself has created the conditions that provide income opportunities for the mercenary debt collection field.

The Brennan Center for Justice released a report in October, 2010 that found many states were “imposing new and often onerous ‘user fees’ on individuals with criminal convictions.” The user fees were financial obligations “imposed not for any traditional criminal justice purpose such as punishment, deterrence, or rehabilitation but rather to fund tight state budgets.” (emphasis mine)

So it seems that such actions necessary to collect revenue lost to the state through recent spending cuts, cutting personal and corporate taxes, especially on the wealthiest, and eliminating tax breaks for profitable corporations has given rise to such practices that go after some of the most vulnerable amongst us. Our legal system it appears is becoming one that reflects more the feudal period of human history than the republican form of government we established for ourselves after severing our allegiance with the British monarchy.

The Brennan Center for Justice report found that:

Across the board, … states are introducing new user fees, raising the dollar amounts of existing fees, and intensifying the collection of fees and other forms of criminal justice debt such as fines and restitution. But in the rush to collect, made all the more intense by the fiscal crises in many states, no one is considering the ways in which the resulting debt can undermine reentry prospects, pave the way back to prison or jail, and result in yet more costs to the public. SOURCE

Man’s inhumanity to man has always been an issue at some level throughout human history. We tend to view it occurring on a large scale in those countries where despots and ruthless oligarchies rule. Our own civilization of course has been guilty of this failure by those who supported the institution of slavery at one time in our history. But even in today’s society it appears there is still an oppressive, inhumane class of people who find ways to insure that the very wealthy are not encumbered from accumulating wealth while those of more common means are inhibited to rise above their struggling financial circumstances.

Extending credit in our economy is vital and enables many to achieve a comfortable lifestyle, not only for themselves but for their posterity. Yet there are risks involved with extending credit and those who do so too easily invite those who would abuse and overuse it. Using the court system in this country to collect what perhaps should not have been made available in the first place is an abuse of our justice system. Furthermore, it is tyrannical to devise ways within our system of jurisprudence to lay the burden of financing needed infrastructure and vital public services on the backs of those who can least afford it, giving a pass instead to those few people who hold the vast amount of the nation’s capital.

“Is it not outrageous that society should treat with such rigid precision those of its members who were most poorly endowed in the distribution or wealth that chance had made, and who were, therefore, most worthy of indulgence?” - Victor Hugo

Posted by lbwoodgate in Corporate Influence, Financial Reform, Occupy Wall Street Protest Tags: ABC News, convict user fees, crony capitalism, debt collector abuses, debt farming, debtors prison, Matt Stoller, Matt Taibbi, Roosevelt Institute, tax farming, Wall Street, Wall Street Journal

15 comments

Unable to See the Forest For the Trees

January 17, 2012

It is a failure that has serious consequences for us all as those within the ranks of the 99% continue to support the wealthiest 1% for the wrong reason

In a video from Bill Moyers’ new show, Moyers & Company there is a segment where members of his team are interviewing people at the Zuccotti Park’s Occupy Wall Street movement in lower Manhattan. I was captivated by the presence and comments of a Wall Street-type investment banker from Florida named Stephen Hays. He clearly stuck out from the OWS crowd as he and a friend with him were dressed like the Wall Street bankers they were. He was having a conversation with a market executive from Oregon, Peter Craycroft. Craycroft was speaking optimistically about the Occupy Wall Street movement and particularly how the OWS encampment was a “perfect kind of forum for us all to come and talk about [our concerns]”

Hays was smirking as Craycroft explained how he had “seen many souls change” on both sides. “Really” Hays said dismissively, then proceeded to lecture his peer:

“I went through the Woodstock generation, Hays said, and I thought it was just back to business as usual. Just sort of … it was a big party. That’s what I see this as, (gesturing to the OWS crowd gathered around him) a party with no cover.”

Hays then turned his attention to the Moyer’s reporter:

“I’m a defender of money, freedom, individual freedom, rich people. Cause I’m still … even though I’m still trying to be one … because the more money I have, the more good I can do. And it will be my decision on how I allocate that good. How I allocate that capital.

And when I look around at all of these buildings, hospitals, colleges … I don’t see many poor peoples names. They’re all rich people.

Reverend Ike, a black minister use to preach up here in New York, and he used to say ‘if you curse the rich you’ll never be one’”

When challenged by a passerby who questioned whether rich people will actually allocate their resources in a manner that benefits society as they see fit, Hays circumvents the question by condescendingly pointing out that the guy questioning him has “a nice camera, nice clothes” alluding to the fact that it was the free-markets that made that possible. I just can’t be so pessimistic” Hays tells the man.

We hear that a lot from the supporters of rich people and money. The fact that many of the 99% can have cheaply made gadgets and other commodities totally misses the point that we are only able too because they were made in cheaper foreign labor markets. Labor markets that took many American jobs and have ultimately created the condition we are seeing today where wages in this country have to more closely reflect those cheaper wages abroad.

Where Peter Craycroft from Oregon saw opportunity to address the core issue with the OWS crowd regarding the growing income disparity in this country, his counterpart in investment banking, Stephen Hays, only saw a new generation of hippies threatening his income source as they “party” with no meaningful solution to the problem – “no cover” as he referred to it.

Stephen Hays had pre-conceived notions before coming down to Zuccotti Park. It seems pretty clear that he left with them completely intact.

To people like banker Hays the OWS crowd represents a direct threat to the iconic status of the career he has chosen. The belief in money, individual freedom and rich people that Hays defends seems to come across however as a defensive reaction that isn’t willing to accept the reality that this choice has some serious flaws. It isn’t easy for people to come to grips with the fact that their choices they have aspired to for years has lost some credibility. People who don’t share their views will automatically be seen as a threat. Demonizing this threat is an act to reinforce their own self-worth.

But there really isn’t any threat out there from the OWS crowd or anyone else for that matter who feels like large corporations should have some government oversight, contrary to what Stephen Hays thinks. The Occupy Wall Street movement is not an anti-capitalist, socialist movement as has been portrayed by Wall Street. It’s a reaction to the overwhelming evidence that Wall Street is occupying nearly every facet or our lives, the 99%. The American middle class is slowly disappearing while 1% of the nation’s income earners expands astronomically as this chart shows.

Left unchecked this rapid income-gap expansion could see this once great economy that people from all around the world wanted to emulate turn into something closer to those nations run by despotic oligarchies. Let’s put things in perspective so people like Stephen Hays can have a more realistic view of the problem we’re having in this country.

Sean F. Reardon and Kendra Bischoff of Stanford University put out a report entitled Growth in the Residential Segregation of Families by Income,1970-2009, that demonstrated how a severe income disparity can affect the character of the local areas where people currently live, going from once stable, middle income neighborhoods to more crime ridden, less sociable poorer ones. As people lose their jobs or suffer wage decreases they ultimately lose the ability to keep up with mortgages or buy homes homes that are in good neighborhoods.

What slowly tends to happen is that mixed neighborhoods where there is a blend of affluent and moderate income families begin to disappear creating greater segregation between the haves and have-nots. As this income segregation grows it may well lead to inequality in social outcomes.

Income segregation implies, by definition, that lower-income households will live in neighborhoods with lower average incomes than do higher-income households. A large body of research suggests that the neighborhood context one lives in can directly affect that person’s social, economic, or physical outcomes. This suggests that income segregation will lead to more unequal outcomes between low- and high-income households than their differences in income alone would predict because households are also influenced by the incomes of others in their community.

What this portends is that more and more children today are less likely to be upwardly mobile than their parents were. Current census data has shown that “a record number of Americans — nearly 1 in 2 — have fallen into poverty or are scraping by on earnings that classify them as low income … [depicting] a middle class that’s shrinking.”

Coupled with this is a report by the Organization for Economic Cooperation and Development (OECD) that shows a pattern here that could prove economically disastrous for this country as “the gap between rich and poor in O.E.C.D. countries has reached its highest level for over 30 years.” O.E.C.D. countries are not third world nations. They are some of the most prosperous nations in the world. Of the 22 nations rated, the U.S. has the 3rd highest rate of income disparity, trailing nations like Denmark, Luxembourg and our neighbor to the north, Canada.

Paul Krugman elaborates on these findings, explaining that “we actually have less intergenerational economic mobility than other advanced nations. That is, the chances that someone born into a low-income family will end up with high income, or vice versa, are significantly lower here than in Canada or Europe.”

And there’s every reason to believe that our low economic mobility has a lot to do with our high level of income inequality.

Last week Alan Krueger, chairman of the president’s Council of Economic Advisers, gave an important speech about income inequality, presenting a relationship he dubbed the “Great Gatsby Curve.” Highly unequal countries, he showed, have low mobility: the more unequal a society is, the greater the extent to which an individual’s economic status is determined by his or her parents’ status. And as Mr. Krueger pointed out, this relationship suggests that America in the year 2035 will have even less mobility than it has now, that it will be a place in which the economic prospects of children largely reflect the class into which they were born. SOURCE

So let’s return to Stephan Hays’ defense of wealth and his right to allocate his capital as he chooses. This is not simply about one’s “individual freedom”. It’s about a way of life that has developed over the last century where upward mobility has been a given. It resulted not because we waited for the wealth of a few to trickle down to everyone else but because their was an ethic within our government and society to provide for the general welfare. An ethic which saw that a decent living wage and basic health care coverage made good economic sense and enhanced growth. An ethic that provided good education for all its citizens and provided quality roads, schools and parks so that upward mobility would be possible.

Mr Hays was also wrong about how only the names of the rich people were on the all the buildings, hospitals and colleges. Yes, there are those private institutions whose wealthy benefactors have insisted that part of the deal for laying out the funding include plastering their name on the building. However, every public school, public library, county hospital and state university system are there through the taxes that we all pay for. Those along with every private institution are built not by rich people but the labor of hard working low and middle income people.

Most of that wealth generated to pay for that labor came from a prosperous middle class that could afford to buy the products and open savings accounts that ultimately provided investment funds to construct great depositories of business, medicine and education. Take that middle class away by reducing their income and it will be matter of about two decades where fewer such dwellings will be in place.

When everything becomes owned by the private sector then only people with enough money will be able to utilize their services, slowly eliminating more and people as that income for most of the 99% fails to keep pace with the 1%. The public commons will eventually exist no more.

Mr Hays should be grateful that this “new generation of hippies” is out their trying to save capitalism from itself so he can continue to aspire to be wealthy. Follow their lead Mr. Hays if for no other reason than you own survival is at stake. No one is “cursing the rich” because we don’t want to be like them. We merely want a livable income so we can prepare our kids and grandkids to take advantage of those opportunities that are all but disappearing from their grasp.

Inconvenient Income Inequality (Charles M. Blow, NY Times)

Posted by lbwoodgate in Corporate Influence, Economy, Financial Reform, Occupy Wall Street Protest Tags: Bill Moyer, concentrated wealth, haves and have-nots, income disparity in America, Occupy Wall Street, OWS, private versus public ownership, Wall Street

9 comments

Tag Archives: Wall Street

The “We” and “I” That Make “Us”

“Obama is liberated”, Brooks tells us and “he has picked a team and put his liberalism on full display”.

His argument to distinguish between the concepts of “centralized” and “decentralized’ is yet another dichotomy that conveys a simplistic black and white comparison that ultra conservatives will interpret more along the narrower frame of reference, good vs. evil.

Though the concept of “we” is more inclusive than the “I”, both should shift to the more encompassing “us”. It is through the combined efforts of individual aptitudes and group strengths that will enable all of us as one people to persevere.

A Final Thought on Gun Violence and the Shootings At Sandy Hook Elementary School

This Is For Real Folks!

Reality meet Fantasy

I fear that well-intentioned people have been led astray by these huckster’s and to the likely detriment of our democracy in the future. I have a young friend who posted the following on his Facebook page:

“I don’t care for Obama or Romney but Obama had his turn and didn’t do that good. So Romney it’s your turn buddy! Please do better then(sic) what we had to deal with the last 4 years!”

I just want to shake the young man and tell him that this isn’t a crap shoot. This is like thinking your luck at a casino will change if there’s a different card dealer. Learning all you can about poker is more apt to benefit a player than picking someone the casino selects.

The climate change link may be more than just more precipitation. A 2010 study found“Global warming is the main cause of a significant intensification in the North Atlantic Subtropical High.” Climate Central’s Andrew Freedman explains a possible influence:

Recent studies have shown that blocking patterns have appeared with greater frequency and intensity in recent years….

“…they say if you don’t vote, you get the government you deserve, and if you do, you never get the results you expected.”

As important as voting is in a democracy, it is informed voting that will garner better results and ongoing participation in the political process that ensures any likelihood that you’ll get the government you expected.

Misplaced Meritocracy

They Live In a World of Their Own

“Taking our Country Back” … Before the Notion of Justice for All

Unable to See the Forest For the Trees

Search Blog Content

America Honors Leaders, Not Politicians

Bet on solar power

What I have written recently

Blogroll

Archives

Follow “Woodgate's View”