A little inside Economics

I find sometimes when I talk to people about my Economic positions they look at me like some kind of three eyed monster. I am totally mainstream. Keynes, Samuelson (well, to the extent he steals from Keynes) it’s all in there.

I have my modern influencers and one of them is Robert Reich.

Why Billionaires Don’t Really Like Capitalism
by Robert Reich
Monday, November 11, 2019

Billionaires are wailing that Elizabeth Warren’s and Bernie Sanders’s wealth tax proposals are attacks on free market capitalism.

Warren “vilifies successful people,” says Jamie Dimon, CEO of JPMorgan Chase.

Rubbish. There are basically only five ways to accumulate a billion dollars, and none of them has to do with being successful in free market capitalism.

The first way is to exploit a monopoly.

Jamie Dimon is worth $1.6 billion. That’s not because he succeeded in the free market. In 2008 the government bailed out JPMorgan and four other giant Wall Street banks because it considered them “too big to fail.”

That bailout is a hidden insurance policy, still in effect, with an estimated value to the big banks of $83 billion a year. If JPMorgan weren’t so big and was therefore allowed to fail, Dimon would be worth far less than $1.6 billion.

What about America’s much-vaulted entrepreneurs, such as Jeff Bezos, now worth $110 billion? You might say Bezos deserves this because he founded and built Amazon.

But Amazon is a monopolist with nearly 50 percent of all e-commerce retail sales in America, and e-commerce is one of the biggest sectors of retail sales. In addition, Amazon’s business is protected by a slew of patents granted by the U.S. government.

If the government enforced anti-monopoly laws, and didn’t give Amazon such broad patents,Bezos would be worth far less than $110 billion.

A second way to make a billion is to get insider information unavailable to other investors.

Hedge-fund maven Steven A. Cohen, worth $12.8 billion, headed up a hedge fund firm in which, according to a criminal complaint filed by the Justice Department, insider trading was “substantial, pervasive, and on a scale without known precedent in the hedge fund industry.” Nine of Cohen’s present or former employees pleaded guilty or were convicted. Cohen got off with a fine, changed the name of his firm, and apparently is back at the game.

Insider trading is endemic in C-suites, too. SEC researchers have found that corporate executives are twice as likely to sell their stock on the days following their own stock buyback announcements as they are in the days leading up to the announcements.

If government cracked down on insider-trading, hedge-fund mavens and top corporate executives wouldn’t be raking in so much money.

A third way to make a billion is to buy off politicians.

The Trump tax cut is estimated to save Charles and the late David Koch and their Koch Industries an estimated $1 to $1.4 billion a year, not even counting their tax savings on profits stored offshore and a shrunken estate tax. The Kochs and their affiliated groups spent some $20 million lobbying for the Trump tax cut, including political donations. Not a bad return on investment.

If we had tough anti-corruption laws preventing political payoffs, the Kochs and other high-rollers wouldn’t get the special tax breaks and other subsidies that have enlarged their fortunes.

The fourth way to make a billion is to extort big investors.

Adam Neumann conned JP Morgan, SoftBank, and other investors to sink hundreds of millions into WeWork, an office-sharing startup. Neumann used some of the money to buy buildings he leased back to WeWork and to enjoy a lifestyle that included a $60 million private jet. WeWork never made a nickel of profit.

A few months ago, after Neumann was forced to disclose his personal conflicts of interest, WeWork’s initial public offering fell apart and the company’s estimated value plummeted. To salvage what they could, investors paid him over $1 billion to exit the board and give up his voting rights. Most other WeWork employees were left holdingnear-worthless stock options. Thousands were set to be laid off.

If we had tougher anti-fraud laws, Neumann and others like him wouldn’t be billionaires.

The fifth way to be a billionaire is to get the money from rich parents or relatives.

About 60 percent of all the wealth in America today is inherited, according to estimates by economist Thomas Piketty and his colleagues. That’s because, under U.S. tax law – which is itself largely a product of lobbying by the wealthy – the capital gains of one generation are wiped out when those assets are transferred to the next, and the estate tax is so tiny that fewer than 0.2 percent of estates were subject to it last year.

If unearned income were treated the same as earned income under the tax code, America’s non-working rich wouldn’t be billionaires. And if capital gains weren’t eliminated at death, many heirs wouldn’t be, either.

Capitalism doesn’t work well with monopolies, insider-trading, political payoffs, fraud, and large amounts of inherited wealth. Billionaires who don’t like Sanders’s and Warren’s wealth tax should at least support reforms that end these anti-capitalist advantages.

C’mon, this is a self-help pep talk. Bootstraps.

House

Head Like A Hole – Nine Inch Nails

In Bloom – Nirvana

Enter Sandman – Metallica

The Breakfast Club (Vegetables)

Welcome to The Breakfast Club! We’re a disorganized group of rebel lefties who hang out and chat if and when we’re not too hungover we’ve been bailed out we’re not too exhausted from last night’s (CENSORED) the caffeine kicks in. Join us every weekday morning at 9am (ET) and weekend morning at 10:00am (ET) (or whenever we get around to it) to talk about current news and our boring lives and to make fun of LaEscapee! If we are ever running late, it’s PhilJD’s fault.

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This Day in History

UN war crimes panel to try Slobodan Milosevic for genocide in Bosnia; Ukraine’s Viktor Yushchenko declares win in disputed vote; ‘Life’ first hits newsstands; Singer Enrico Caruso makes American debut.

Breakfast Tunes

Something to Think about over Coffee Prozac

Vegetables are a must on a diet. I suggest carrot cake, zucchini bread, and pumpkin pie.

Jim Davis

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Thoughtful and Measured

I often find Seth provides balanced and thorough coverage.

Or you can blow off everyone in your life and enter a Cheeto stained coma.

Chris Hayes stands in the Armadillo lane waving at the traffic

A more strident alarm from Rachel

Zaz from Larry

The other Larry

I’m talking about Oak Island. So it’s not a ship, it’s a something. Nothing else is quite as compelling, tonight for instance I’m going to attempt a showing of Frozen II (don’t judge, the cold doesn’t bother me anyway) instead of watching Parker, Rick, and Tony.

What about Stephen? What about him. He was off in New Zealand filming a Mary Sue Hobbit on CBS’s dime.

Nice to have hobbies says the man in a secret duel with Atrios for the title of ‘World’s Worst Blogger’.

Pondering the Pundits

Pondering the Pundits” is an Open Thread. It is a selection of editorials and opinions from> around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Pondering the Pundits”.

Follow us on Twitter @StarsHollowGzt

Paul Krugman: Trump and His Corrupt Old Party

For Republicans, there is no bottom.

Formally, the House of Representatives is holding an inquiry into the question of whether Donald J. Trump should be impeached. In reality, we’ve known the answer to that question for a long time. In a different era, when both parties believed in the Constitution, Trump’s abuse of his position for personal gain would have led to his removal from office long ago.

No, what we’re actually witnessing is a test of the depths to which the Republican Party will sink. How much corruption, how much collusion with foreign powers and betrayal of the national interest will that party’s elected representatives stand for?

And the result of that test seems increasingly clear: There is no bottom. The inquiry hasn’t found a smoking gun; it has found what amounts to a smoking battery of artillery. Yet almost no partisan Republicans have turned on Trump and his high-crimes-and-misdemeanors collaborators. Why not?

The answer gets to the heart of what’s wrong with modern American politics: The G.O.P. is now a thoroughly corrupt party. Trump is a symptom, not the disease, and our democracy will remain under dire threat even if and when he’s gone.

Eugene Robinson: magine defending Trump after this week’s hearings. Oh, wait…

After this week’s impeachment testimony, if Republicans continue to insist that Dear Leader President Trump did absolutely nothing wrong — and they might do just that — then the GOP has surrendered any claim to being a political party. It would be a full-fledged cult of personality.

U.S. Ambassador to the European Union Gordon Sondland, who gave hours of riveting testimony Wednesday, clearly was determined not to be the fall guy for Trump’s Ukraine bribery scheme. He saw the danger of being portrayed as some sort of rogue actor, and he was having none of that.

“We followed the president’s orders,” he testified. And in defining “we,” he implicated Vice President Pence, Secretary of State Mike Pompeo, acting White House chief of staff Mick Mulvaney and Energy Secretary Rick Perry, among others, as knowing of or participating in the attempt to coerce Ukrainian officials into fabricating dirt on Trump’s potential Democratic opponent in the coming election, Joe Biden. [..]

Arms for dirt. That was the exchange Trump demanded, using as leverage taxpayer funds that had been appropriated to buttress U.S. national security. Explain to me how anyone can honestly believe that is an appropriate use of presidential power.

Charles M. Blow: Failing to Decipher Black Voters

This group is multifaceted. Understanding that is key.

There was quite a bit of talk about the black vote and the black community at Wednesday night’s presidential debate.

Maybe that’s because they were in Atlanta, the majority-black capital of the South. But it is also, I am sure, because black voters have played and continue to play a crucial role in who gets the Democratic nomination. [..]

I believe deeply that much of the Democratic field is still struggling — and failing — to decipher what animates the bulk of black voters. As much as I believe in polling and its ability to uncover information, I don’t believe that the way black people are polled is sufficient and comprehensive.

As I’ve mentioned before, the black vote is multifaceted, like any group of voters. Young black voters see things differently from older ones. There is a slight but statistically significant difference in the way black women vote compared with black men. And black voters in the South see things slightly different from the way black voters in the North and West see things.

Randall D. Eliason: Nunes’s ‘carousel of allegations’ all contain impeachable acts

A common Republican criticism in the ongoing impeachment proceedings is that Democrats have repeatedly changed their position concerning what offense President Trump may have committed in his dealings with Ukraine. In his opening statement on Thursday, Rep. Devin Nunes (Calif.), the House Intelligence Committee’s ranking Republican, said: “The offense itself changes depending on the day, ranging from quid pro quo, to extortion, to bribery, to obstruction of justice, then back to quid pro quo.” He accused Democrats of riding on a “carousel of allegations.”

But there is no carousel. As a legal description of the president’s conduct, all of these charges are accurate, and all at the same time. [..]

In any event, there is no “carousel of allegations.” Bribery, extortion and quid pro quo are simply different ways to say the same thing: that the president abused the power of his office to pressure Ukraine to take actions that would personally benefit him. It’s not at all uncommon for the same conduct to violate more than one statute. A crime by any other name still smells as corrupt. But the Constitution specifically names bribery as a basis for impeachment. That’s reason enough alone to choose that term to describe the president’s conduct.

John Atcheson: Sorry, President Obama—But We Do Need To Tear Down The System

When neoliberals and centrists defend “the system” or warn against upending it, they’re more likely expressing concerns about their losing their personal power base than they are about the Party winning elections.

There are two ways to practice politics: you can either follow polls or shape them. For four decades now, Democrats have been poll followers, and Republicans have been poll shapers.

Recently, President Obama urged the Democrats to continue being poll followers, saying, “The average American doesn’t think we have to completely tear down the system and remake it.” The evidence suggests he’s wrong about that, but even if he isn’t, Democrats need to change the mind of the average American, not be led by it.

Here’s why. “The system” was designed by and for corporate America and the ultra-rich, and it has robbed people of their power and their livelihood, and undermined the Democratic Party. [..]

When neoliberals and centrists talk about “the system,” they’d like us to think about the democratic republic defined by the Constitution and the Bill of Rights, and the nearly two centuries of respect and practice that governed those implementing the Enlightenment values contained in these documents. But that system is gone. It has been replaced by an oligarchy.

The time to follow polls is long gone. If we are to restore our freedoms, we must shape polls, not follow them. Fortunately, leading a progressive rebellion against the oligarchy is not only the moral thing to do; it’s smart politics, too.

And Now You Know

I’m actually kind of anxious having just 5 days of hearings, although the facts are abundantly clear-

Unindicted Co-Conspirator Bottomless Pinocchio in violation of the criminal statutes involving withholding Federal funds and Election Financing as well as his Oath of Office and the Constitutional crime of Bribery personally directed the Majesty and Power of the United States and its Official Government Agencies to Extort a Foreign Power to interfere in our democratic processes for his own benefit.

He admits it. Live. On TV.

(Ok, horrible video. Doesn’t even start until 7 minutes in but, there it is- 8:30. Never say I don’t give you context though. It’s like a favor.)

I’ve only seen this twice before (No, I didn’t see Johnson. I’m not as old as my Mom.). It seems…

quick.

I can’t shake the feeling that Nancy and the Institutionals are pulling a Pilate- washing their hands as fast as possible and simply resigned to the idea this is going nowhere in the Senate which is certainly possible, even likely.

That would miss the point.

Look, I’m no Bubba Booster (nor Bernie Bro, I have my own agenda) and I think power relationships made it creepy, but it was consensual and “Is” in fact has a whole lot of meanings, with it, or variants, BEING (a variant) THE SINGLE MOST POPULAR VERB EVER!

I’m sorry if that sentiment offends you. Not about the sentiment, that it offends you.

Now Tricky Dick (forget that parallel with Slick Willie?) did something way worse- he subverted the actual instruments of legitimate Government for partisan and personal advantage. Get it?

Unless Unindicted Co-Conspirator Bottomless Pinocchio resigns (I hear he’s sick, cough, cough) or is Impeached the future threshold will be an extramarital Blowjob and besides- Glass Houses! Impeach him anyway!

My position is that even, no- especially, in this instance the crimes are manifest beyond a reasonable doubt and wide spread, indicting many prominent Republicans in the commission and cover up including (but not limited to) Pence, Pompeo, and Mukasey. I’ll deliberately skip Perry because despite the glasses I think him no brighter than a drawer of socks that desperately need sorting and incapable of forming intent. He should be institutionalized so a Federally paid staff can administer appropriate care.

Ukraine-gate (Are we calling it that yet? It’s so hard to tell.) is not the limit of the scope of the scandal that envelops Unindicted Co-Conspirator Bottomless Pinocchio, his Crime Family, and Republican Racketeers.

Nancy, you have him, and them, dead to rights. At least carry through on this and please, please, please no “looking forward.”

It sets a bad example.

Cartnoon

I’m sure you’ll be just fascinated to know what Mrs. Betty Bowers, America’s Best Christian, thinks about Impeachment.

Ok Bradley, where is Deven Green?

Oh. There. Do you know she’s Canadian!? Good Beer, Free Health Care, Legal Weed, and A&W with Cane Sugar!

Still American. Two Continents, One Hemisphere.

This weekend I shall be taking the temperature at Lake House. I’m told it’s cold.

The Breakfast Club (High Sounding Words)

Welcome to The Breakfast Club! We’re a disorganized group of rebel lefties who hang out and chat if and when we’re not too hungover we’ve been bailed out we’re not too exhausted from last night’s (CENSORED) the caffeine kicks in. Join us every weekday morning at 9am (ET) and weekend morning at 10:00am (ET) (or whenever we get around to it) to talk about current news and our boring lives and to make fun of LaEscapee! If we are ever running late, it’s PhilJD’s fault.

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This Day in History

President John F. Kennedy is assassinated and Texas Gov. John Connally is seriously wounded during a motorcade in Dallas. Suspect Lee Harvey Oswald is arrested. Lyndon B. Johnson becomes America’s 36th president.

Breakfast Tunes

Something to Think about over Coffee Prozac

We have too many high-sounding words, and too few actions that correspond with them.

Abigail Adams

Continue reading

For the Record: Day 5

Fiona Hill and David Holmes

Transcript

Cornucopia

It’s that time of year again. Thanksgiving? No! Impeachment Season!

Anti-Semitic Semite

Food Day of Gratitude

Not to put too fine a point on it, but hoarse voiced Sam has already made this Adult Content which is fine because we are an Adult Site that deals with Adult Issues and if you’re not ready for that you should instead review our volumes of fine material suitable for elderly or opinionated relatives and small children.

Women are not potted plants. They are real people. You should get to know some you pimply faced Steve Miller Incel.

Unrigged Update

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