There is a mighty river of greed in America that led to the Gilded Age and the giant monopolies of the early 19th century, that feeds on the largess that derives from preparing for and waging unnecessary wars, that has resulted in a new Gilded Age begun by King Reagan and furthered over half a century by a Republican Party that never saw a tax cut that it didn't like, unless it was for average working people or - horrors! - for (non-existent) fat black welfare mothers who lived to procreate when they weren't feeding from the government trough and driving around town in their shiny new Cadillacs.
There was a time when a confluence of big corporations and an all-powerful government was called fascism, when politicians were bought and paid for by corporations given free rein to do as they wished with their workers while being given gigantic meta-tax breaks and outright donations gathered from tax-paying fools, that is, the 'working class'.
But no, you say, fascism was destroyed in World War II when "we" (we'll leave out the Russians who lost tens of millions of citizens fighting and destroying the German army on the Eastern Front) got rid of Hitler, Mussolini and Tojo. Well guess what? Fascism became American and it's all around us, hiding behind the flag, pervading our government and our society, destroying our Constitution, making fools of real democrats (small 'd'), crushing the unions, and creating a massive and extraordinary depression in human rights and human well-being.
They say that discovering and admitting the truth is the first step in healing. Well, here we are, in our racist, class-based economy and society built not for us but for the millionaires and billionaires and soon, the trillionaires, our very own aristocracy of greed that a hundred Biden's working for a hundred years won't be able to turn right-side up. But we can try. The alternative is unthinkable, but must still be thought. We must try.
That "mighty river of greed" was conceived in the slave states and born into our constitution in the form of protection for the institution of chattel slavery and its unpaid labor. That protection is embodied in Article IV (States Rights), Section 2 on runaway slaves. The representational power of slave states by being allowed two senators for states of any size, as well as including 3/5 of the enslaved population in the head-count for its allocation of Representatives. There were also several other aspects of representational power that were strongly influenced by the interests of the slave states. The Gilded Age did not invent the notion of cheap labor. OK, so it also built into serfdom and into the sweat shops of the Industrial Revolution, and the Aristocracies of Europe that the Founders professed to abhor.
By the way, I think that by "early 19th century" you meant the "early 1900s", a form that is less prone to error on the part of both the author and the reader.
Ra, this is an excellent look at some of the broader pernicious aspects of the stratification and abuse of humanity and I'm in total agreement. It's essentially the reason I can't bring myself to watch either Downton Abbey or any other "great stories" of the upstairs/downstairs variety that purport to show how those at the top deserve to be there while those wastrels at the bottom should just be shipped off to Australia or thrown into political, social, economic and/or total servitude.
The focus of my comment, of course, was on more recent history without taking on the broader aspects of inequality which run throughout our history as homo sapiens. As such, I left out many aspects of the true history of mankind and more specifically, our republic.
The desire for inequality, by color, sex, sexuality, ethnicity, wealth or geographic origin seems to be built into our genes and is a never-ending subject for study, reflection, and discussion. It will be interesting to see the ramifications of the 1619 Project and whether we will one day have schools which teach in full the history of America.
Interesting that you (and Ray in replying) generated such a rich albeit brief conversation about American evolutionary economic tendencies… without mentioning the word oligarchy! Classically defined, it is government by the despotic few, exercising power for corrupt and selfish purposes. Oligarchy is, some say, a debased form of aristocracy, to which you allude as well. Though America has long decried it, we have managed to create our own ruling class that believes government should be run by just a few, only the “Ivy-est” individuals and power must not be shared with common people.
Here’s a crazy idea… since the big guys are holding the bag, how about we convince just one of them, Bezos that whatever amount of money he has now is enough for him to live out happily for the rest of his days (I know crazy right?). Then we get him to work on shareholders to convince them to transform Amazon into a trust owned company that serves the greater good. We are doing this at my teeny tiny company so I know it can work. One third of distributed profits at The Walker Group go to employees. One third goes to nonprofits solving community problems. And one third to shareholders. If we could get him to set the example, I think others would follow. What do you think?
Agree. Maybe I'm misinformed, but I thought the pandemic relief legislation was intended to help ordinary people survive the severe disruptions caused by the pandemic without being driven into destitution, not to "heat up the economy."
To his credit, Biden is trying to address the corporate monopoly problem as best he can with executive branch actions. He should be more vocal about blaming greedy corporate leaders for higher prices. Bernie Sanders should also add that to his message, if he hasn't done so already.
I agree. A few additions. Not surprisingly, the US stands out among "Western democracies" not only in lack of regulation of large corps but the meager often punitive nature of its social supports. When I moved to Canada for graduate studies in 1970s, not only was I a "landed immigrant" and not a "resident alien," but I immediately had free medical insurance founded by Ontario's Progressive Conservatives.
Control of monopolies stopped large in the 1910s with waning of the only Progressive Era and the oddity of breaking of of Bell Telephone 30 years ago.
Finally, so many of our social and political ailments today are aided and abetted by unregulated enormously wealthy social media and Big Tech.
Robert's comments on limits of unemployment and decades-old right wing distortions and blaming the victims underscore why we can't simply compare or trust unemployment (or inflation) rates over time.
As I'm sure you saw, Apple is our first $3 trillion corporation, and Elon Musk made $28 billion yesterday. These sums are hard to fathom when the typical working person is earning $56,000 a year, but they're signs of a system that is no longer functioning in sustainable ways.
The system has been failing for a long time. In order for capitalism to succeed one of the requirements is customers able and willing to buy the products and services on offer. If the customer’s income is such that it only just covers the costs of housing, clothing and food, and there is nothing left for discretionary purchases then a large part of the supply chain will slow down, or even stop. That will put workers out of jobs further reducing the customers available. Capitalists need customers, customers need money. If capitalists, like Bezos, Musk and Zuckerberg, used some of their excessive wealth by funding a universal income system, and at the same time capping their own incomes, and corporate profits we would have a system in place that is sustainable. Of course that will never happen. We need regulation and corporations need breaking up before the greedy few gnaw off the hands that feed them.
Apple's pseudo worth grows because it is buying back its own stock, thus inflating value while business alters with rare metal scarce and supply chain problems. This would not be permitted in other "democracies." And Elon Musk is destroying highway safety and space... with no regulation. No one is paying attention to the junking of outer space or regulation of wasteful "space tourism" Only in US (and maybe China)
Musk was credited with about $300 billion in wealth recently; Bezos $200 billion.
Staggering sums -- but brace up! Our net wealth is about $136 Trillion. ( US Fed )
So, thought experiment, we could liquidate Musk or Bezos or one or more of the others who always pop up in these conversations -- even if we liquidate a few of them, the financial impact would be near *zero* in a calm assessment.
$300 billion wouldn't move the needle on the federal budget, not even for one quarter, really. It's about 2 thousandths of our net wealth. That is a comfort to me.
BUT we have to know and use our net wealth to know this!
Progressive income taxes, yes. Laws, yes. Property tax, like 1% to 2% on assets over $5 million, yes, that's only fair, but it is not happening. Liquidation, or massive taxes on unrealized gains, absolutely not.
It gives me no little comfort to see that none of the mind-blowingly wealthy hold more than a couple thousandths of our wealth. Musk is growing toward 1 percent, a concern, but even then.
Take comfort. And, take action to keep things real.
It's maddening. Both Bezos and Musk are pursuing righteous goals and projects, and achieving staggering progress, in my life and our world, one in electric vehicles, and both in space exploration.
In electric vehicles, Tesla has single handedly pushed our country and the world may years closer to eliminating fossil fuel vehicles and their carbon emissions. That seems almost indisputable, to me, and it has been an explicit stated goal from Musk. We should celebrate that.
( Don't believe in climate change? Then just use basic ethics and common sense -- we need to stop dumping crap in the air, to stop dumping crap in the oceans, and to stop dumping crap on the land and in the lakes and rivers. We can do it. )
Jeff was inspired by Gerard K O'Neill, same as I was, at the same old PU, but he was about 10 years later. O'Neill came to our introductory engineering physics course, and projected his slides of huge space colonies made with Saturn V and Apollo technologies, to move humanity out to explore space, using lunar materials instead of wrecking the Earth and our atmosphere, and blew my mind. Truly awesome, I knew I was in the right place. Got away clean, too, I tell ya.
Zero gravity to 1 earth gravity as you like it, unlimited solar energy, very spacious and green, staggeringly beautiful views, just beautiful. Easy low power access to the rest of the solar system. Why? To learn to live with nothing, and to learn more about the universe, and to create new places for humanity to live without wrecking more of our precious world. Planetary bases are not easily suited to humans, wrong gravity and soaked with radiation. They are needed for raw materials, and learning, so there will be some. But a miles long, miles in diameter space colony, essentially a space station done right, could be made to be very livable.
Why not? The list is long. But not: We should spend the money on the Earth! Where do they think the money for space exploration is spent? Cash is piled into rockets and spewed into the sun? Of course not. The money is spent on the earth, mostly in the USofA.
Why not? The long list holds many dangers for human rights and catastrophic action, but that list applies right here on planet Earth, as we can see. Caveat emperor.
One mantra for me is to get capital to those who build lasting value. Musk in particular seems to be a serial creator, and Bezos may end up being known for Amazon web services AWS more than the retail sales and delivery empire. Theranos and crew are just the latest warning on the massive speculative capital investment front. Lies are great investments, for a while, it seems. In addition, in the past few years a Potemkin valley of electric airplane startups has evaporated zillions of investment dollars, for a pursuit that never made sense on the back of an envelope, for one example very near to my heart, with an aerospace engineering master's degree and no airplane companies near Pallor Alter when I received it. ( Got away clean, I tell you. )
Musk has built teams and companies to do what others have failed to do, or have had poor timing. GM and electric vehicles was a failure in my book, not unfortunate timing, but we don't get to re-run the experiment for true scientific assessment, like so many other matters that deserve it.
Musk's team ( not Musk, the teams and companies he started ) has also created -- and deployed! -- a worldwide satellite internet network. You can sign up today! I was in the first commercial rocket company, GCH, and that was a goal of us engineers, on our walks and rambles around the beautiful Bay Area, decades ago. Many funded attempts. Iridium is still working, Globalstar may be, they are no Starlink. Bezos says he will make one too. Musk has one going and growing, others say they will. Talk is cheap, but I'm hopeful there will be true competition. And we should make sure there is, in time.
China and India have recently sent up warning flares over the imminent access to worldwide communications by individual citizens everywhere and anywhere, that is Starlink flying over their heads right now. The bogus claims of the Chinese space station being endangered by Starlink are about politics, not about physics, in my assessment. Those will grow. It will be very curious to see what Musk does with China, one of his biggest Tesla markets and production partners.
For unions, Walmart is top of my list, with McDonald's and other service industries, not Amazon, though it has popped right up there in just the past few years and is in a tie.
Walmart heirs are creating nothing, except maybe un-American trouble. They have a lot of staggeringly rich company. Musk and Bezos, and to some extent Gates and Buffett, are contributing and building with their wealth ( your exceptions noted, Professor, and acknowledging that the exceptions may rule in some charity cases ). But the real disaster in my mind is unbridled untaxed inheritance, as you have detailed from several angles. Chump voters should be most enraged about that. We should remind them, every day.
About 2/3 of new wealth goes to spouses and children, by common sense. Eventually, not so long from now, ALL of new wealth goes to spouses, children, and heirs in general. 60% is the profoundly un-American number I recall from other analyses and presentations you have given us, Professor, and that fraction has grown over the past 20 years as the grotesque and un-American laws to pass wealth without taxes have kicked in. It's worse than a damn monarchy! How can that not enrage regular working voters? Denial is everywhere.
SpaceX is US aerospace reimagined and recreated, very much like the early days of our established aerospace giants, traditional USA -- NOT some radical never-before-seen etc. There were many attempts before it. It's a government contractor, and it is delivering. We see how Boeing is doing as a competitor. They may still deliver, I would not bet on that. No one is keeping Northrop, and Lockheed, and Airbus/ESA, and even Russia, Japan, and China, and other established military industrial complex companies from creating the next generation of space access. They are preventing that all by themselves, and that was very predictable. Nobody is preventing Intelsat or Boeing or SSL from creating Starlink. It's not even close.
So for me, we the people need to capitalize and celebrate the successes of organizations like Tesla and SpaceX and Blue Origin, and their leaders, while making sure they pay their fair share of progressive taxes and treat their people well and lawfully.
running at the keyboard, all for now, best luck to US -- b.rad
ps -- Ok I lied again . . . In 2000 I was hoping my web startup would be valued as many others, but did not see the complete collapse coming, despite the clear lack of sales and profits for most. Likewise, I did not see that others would follow the 'build it and give it away for free and they will eventually pay you zillions' model working so spectacularly well for Google, and FB ( not you TheGlobe.com, Friendster, Myspace . . . ) and Amazon ( no profits! ) and others. . . in 2008 I did not see the housing collapse coming, because it was based on opaque lies and fundamental corruption by a very few trusted ratings companies . . . and on financial instruments like credit default swaps that were and are unregulated disasters waiting to happen . . . I did not see the Volkswagen disaster coming, or the remote possibility that a few engineers and executives could fool the whole world and malign so many employees, investors, and customers. . . and I did not see that Boeing would allow a similarly tiny fraction of its engineers and executives to kill people and throw its reputation in the gutter for who knows how long. So now, the valuations of stocks and bonds are clearly out of whack -- but I can't see why it persists, and I don't see our way out of it. Increased interest rates, to reward savers and reset the economy, are not going to be welcomed by just about anybody in finance leadership. But how else are we going to get back to a robust financial state with good margins for correction?
I was just saying this to my husband yesterday after reading a news article where a huge Corporation was explaining their reasons for "having" to raise prices. My first thought was, why not absorb the loss, for once, instead of raising prices, to ensure continued, steady, profits for the company and CEO? I mean, no company has to raise prices. Small businesses grapple with price raising all...the...time because they have to face their customers when they do it. Look 'em in the eye and explain. I have been one, trust me, I know. Big corporations don't have to so they don't care. They know we have no choice but to pay for it because we can't take our business elsewhere.
Two anti-trust actions, one against AT&T and the other against IBM gave you the internet and the personal computer. Few people under the age of 65 will remember the days when you rented a telephone from Ma Bell and couldn’t connect any device up to its lines without its approval. If you had a teletype machine or acoustic modem in the early 1970s you could get either 10 or 30 print characters per second as the maximum data rate. There was no improvement in that rate until AT&T was broken up. Similarly with IBM. Anti-trust action forced them to copyright not patent their PC operating system which allowed developers to read the code and create software without the obstacles involved in patent monopoly. Prior to that you needed mega bucks and a computer center to develop software.
Just these two anti-trust actions enabled the development of technologies central to the economic growth that began in the 1980s and 90s.
Our form of capitalism is falling apart. We allow corporations to capture regulatory agencies and engage in pricing power monopoly practices completely uninhibited by monopoly regulations.
In state capitalist China the State has the right to tell private companies where they can source their capital. It can stop IPOs and clamp down on anti-competitive practices.
Here regulators and Congress persons routinely cycle in and out of corporate offices. Like Manchin they have a stake in ending or gutting regulations that prevent corporations from dictating what government will and will not be allowed to do.
When I ask the Democratic Party centrists to explain how they plan to reform this mess the only answer I get is elect more Democrats. We are supposed to tell the blue collar workers making $7.25 an hour to vote for the Democratic Senator that voted to take the $15 an hour minimum wage out of BBB bill.
It always amazes me that the centrists in the Democratic Party are oblivious to this impossibility.
If the centrists in the Party grasped the necessity for reform we would have candidates that could win back the voters abandoning the Party.
Does anyone else think we've failed to or forgotten about antitrust legislation and how it should be applied?
I think we've never learned or perhaps even considered that our antitrust environment may have been suitable for prior centuries, but we're not updating that environment for the evolving global corporate
/ digital landscape. Once those laws had some 'teeth'. Now?
The “Democratic” Party is only the lesser of two corporate parties. The battle is not between “progressives” and “centrists”, but between corporations and people. Most legislators of both parties are wholly owned subsidiaries of corporate power. The movie Don’t Look Up captures so well the mess we are in. Corporations, government and the MSM are all conspiring against our survival. We could vote our way out of it, if the election system itself weren’t so corrupted. Three sitting Supreme Court justices started out their careers helping Bush steal Florida. https://jennycohn1.medium.com/the-2000-u-s-presidential-election-was-a-harbinger-of-things-to-come-fecb1de53fa8 The 2000 U.S. presidential election was a harbinger of things to come.
Allegra. Thank you for your thoughts. I have not seen the movie yet but looking forward to watching. I believe it hit the nail on the head from what I have read.
1. more unions; 2. limit the terms for legislators & the Supreme Court; 3. hold legislators responsible for financial gains made during their terms in office; 4. give each candidate an equal set amount of tax-payer money and media time - no private money in elections; 5. make legislators live the life of a single mother trying to support 3 kids while working 3 jobs just to keep a roof over their heads and food on the table - maybe 6 months should do it, assuming they learn something during that time.
People shouldn’t have more money to spend? Seriously? Okay, fine. Then let’s raise taxes on wealthy people and corporations so they have less money to spend on their mega mansions and overpaid CEOs.
Donald Trump incited the insurrection of our Capital in a failed attempt to remain in office as President. There is no dispute. What is more concerning, however, is the total denial by the Republican Party’s leaders of this attempted coup. Only two Republican members of Congress – Liz Cheney (R-WY) and Adam Kinzinger (R-IL) – have demonstrated the courage to put country above party and serve on the January 6th Committee investigating the insurrection. When one of our countries’ major political party’s is willing to accept, and even promote, lies about the integrity of our elections we no longer have a democracy.
Consider also that most Republican’s wrongly believe:
• The vaccine to be more dangerous than the virus,
• That masks are harmful, not helpful,
• That global warming is a hoax,
• That tax breaks for billionaires helps the middle class,
• That Laws to suppress the votes of the poor and people of color are necessary to prevent voter fraud.
And finally, the Republican Party is also responsible for the growing distrust of elected local government officials and school boards with the clear intent to divide us even more than we already are.
They hear this in the Republican "bubble" of Fox News (and other right wing cable channels), talk radio (thousands of stations across the country), and social media websites (Revolver, for example).
I agree with the problem but (who am I to disagree with Robert Reich?) maybe not the solution of increasing taxes on corporations and/or the super-wealthy without effective safeguards against them being able to move out of the U.S. to avoid these taxes and to keep them from passing these taxes also onto consumers. The fundamental problem, as it has been forever, seems to me to be how to get more people to recognize the problem of being taken advantage of people in power then to act on it- in our system at least for now by voting. Monopoly/oligopoly/collusion power creates price inelasticity which forces people to pay high prices or to consume less which would cause a depression although be better for the environment and maybe make us happier beyond basic needs if I'm thinking this through correctly. BTW, I'm terrified by the Republican Party. However I no longer support the Democratic Party, only individual candidates and coalitions, because "our" party seems to have abandoned core values of competence, courage, benificence, and appreciation of disagreement and the worth of others in far too many cases.
If big corporations that don’t pay federal taxes move their headquarters to other countries, let them go! They will continue to want to sell their goods and services to the USA. In response, a pro-active federal response would be to disallow them from selling to the USA if they have departed the USA. But like you, I’m confident that the Democrats don’t have the vision to do such a helpful thing.
Well, let’s go back to Economics 101: inflation occurs when too much money is chasing too few goods and services.
So why is there “too much money”? Our debt-based currency system depends upon monetary cycles. New money enters the economy through government spending and loans through the banking system. This money fuels the economy, but then has to exit the system so the next round of financing can happen.
This “old” debt is supposed to be retired through a combination of loan repayment and taxation. However, as the Middle Class shrinks and real wages stay flat in an expanding economy, tax revenue shrinks and debt repayment is increasingly distressed. At the other end of the economic spectrum, the uber-wealthy are reluctant to give up even a penny of wealth, so find ever more clever ways to evade taxation.
The result? Like a clogged drain, money builds up in the system and inflation is the result.
The solution? Tax away extreme wealth, on a progressive basis. It’s not about “punishing” success but rather enabling success to be shared much more widely
While things in this country have never been perfect the overall best time for the working class was the postwar boom from 1947-1972. During that time the wealthy and corporations paid a much higher tax rate, as much as 70% for wealthy people in the 1940's and 1950's. It is interesting how the news media, including people like Jake Tapper, Wolf Blitzer, Erin Burnett, and Anderson Cooper at CNN, as well as many others in the mainstream news media at all the stations never report that. Also during that time Unions had much greater power than they do now.
Exactly, Brian. The mainstream news media suffers from an ahistoricity of sorts. The constant churn of the cable news media keeps the conversation focused on the immediate moment and rarely zooms out to provide a broader context.
This response is from a Guardian thread and is a slight deviation from the core issue of Potterizing but includes ideas regarding the power of corporations and how unions were demonized in order to subvert the middle class.
Dr. Reich exposes another of the beloved lies in the US: that unions are the cutting edge of communism or even worse, socialism. Unions were formed to end worker exploitation, and one of only many battles was fought with Henry Ford that was 'ended' in 1941 with the impending war. The settlement was at the figurative point of a cocked and loaded gun to Ford's head. Patriotic? Change of heart? Ha. As noted in prior comments, the corporations just change locations if and when they can and demand a subsidy in doing so.
Are the plutocrats really that crass? They assume the most extreme position possible in order to negotiate on what appears to be conciliatory measures. This has been observed throughout history. A noted economist:
When the final result is expected to be a compromise, it is often prudent to start from an extreme position. - John M. Keynes
Of course, power never surrenders the slightest amount of influence without a fight much like the camel's nose is not allowed in a tent. Another economist:
People of privilege will always risk their complete destruction rather than surrender any material part of their advantage. - John K. Galbraith
The rich and influential always bet that their money and connections will save them at the last moment. As an engineer, economist, and data scientist, I have seen [almost] nothing in capitalism and its great leaders that indicate the slightest understanding that people are more important than profits. Capitalist corporations appear to be nothing other than unconscious creations of commercialism, consumption, and greed.
NB - I am not advocating gun violence in any sense - metaphorically or otherwise.
We need some widely publicized charts showing tax rates vs corporate profits vs average wages, vs. ceo pay, all adjusted for inflation, since Reagan's trickle down theory. Maybe throw in union membership as well. It's the "widely publicized" part that's most difficult, because we don't have a megaphone the size of Fox News.
There is a mighty river of greed in America that led to the Gilded Age and the giant monopolies of the early 19th century, that feeds on the largess that derives from preparing for and waging unnecessary wars, that has resulted in a new Gilded Age begun by King Reagan and furthered over half a century by a Republican Party that never saw a tax cut that it didn't like, unless it was for average working people or - horrors! - for (non-existent) fat black welfare mothers who lived to procreate when they weren't feeding from the government trough and driving around town in their shiny new Cadillacs.
There was a time when a confluence of big corporations and an all-powerful government was called fascism, when politicians were bought and paid for by corporations given free rein to do as they wished with their workers while being given gigantic meta-tax breaks and outright donations gathered from tax-paying fools, that is, the 'working class'.
But no, you say, fascism was destroyed in World War II when "we" (we'll leave out the Russians who lost tens of millions of citizens fighting and destroying the German army on the Eastern Front) got rid of Hitler, Mussolini and Tojo. Well guess what? Fascism became American and it's all around us, hiding behind the flag, pervading our government and our society, destroying our Constitution, making fools of real democrats (small 'd'), crushing the unions, and creating a massive and extraordinary depression in human rights and human well-being.
They say that discovering and admitting the truth is the first step in healing. Well, here we are, in our racist, class-based economy and society built not for us but for the millionaires and billionaires and soon, the trillionaires, our very own aristocracy of greed that a hundred Biden's working for a hundred years won't be able to turn right-side up. But we can try. The alternative is unthinkable, but must still be thought. We must try.
Exactly right. We have no choice but to try.
That "mighty river of greed" was conceived in the slave states and born into our constitution in the form of protection for the institution of chattel slavery and its unpaid labor. That protection is embodied in Article IV (States Rights), Section 2 on runaway slaves. The representational power of slave states by being allowed two senators for states of any size, as well as including 3/5 of the enslaved population in the head-count for its allocation of Representatives. There were also several other aspects of representational power that were strongly influenced by the interests of the slave states. The Gilded Age did not invent the notion of cheap labor. OK, so it also built into serfdom and into the sweat shops of the Industrial Revolution, and the Aristocracies of Europe that the Founders professed to abhor.
By the way, I think that by "early 19th century" you meant the "early 1900s", a form that is less prone to error on the part of both the author and the reader.
Ra, this is an excellent look at some of the broader pernicious aspects of the stratification and abuse of humanity and I'm in total agreement. It's essentially the reason I can't bring myself to watch either Downton Abbey or any other "great stories" of the upstairs/downstairs variety that purport to show how those at the top deserve to be there while those wastrels at the bottom should just be shipped off to Australia or thrown into political, social, economic and/or total servitude.
The focus of my comment, of course, was on more recent history without taking on the broader aspects of inequality which run throughout our history as homo sapiens. As such, I left out many aspects of the true history of mankind and more specifically, our republic.
The desire for inequality, by color, sex, sexuality, ethnicity, wealth or geographic origin seems to be built into our genes and is a never-ending subject for study, reflection, and discussion. It will be interesting to see the ramifications of the 1619 Project and whether we will one day have schools which teach in full the history of America.
Where is the 'edit' key? Sorry for getting your name wrong, Ray.
Interesting that you (and Ray in replying) generated such a rich albeit brief conversation about American evolutionary economic tendencies… without mentioning the word oligarchy! Classically defined, it is government by the despotic few, exercising power for corrupt and selfish purposes. Oligarchy is, some say, a debased form of aristocracy, to which you allude as well. Though America has long decried it, we have managed to create our own ruling class that believes government should be run by just a few, only the “Ivy-est” individuals and power must not be shared with common people.
Oligarchy describes economic structure whereas whereas aristocracy describes political structure. The two are often in friendly collusion.
Here’s a crazy idea… since the big guys are holding the bag, how about we convince just one of them, Bezos that whatever amount of money he has now is enough for him to live out happily for the rest of his days (I know crazy right?). Then we get him to work on shareholders to convince them to transform Amazon into a trust owned company that serves the greater good. We are doing this at my teeny tiny company so I know it can work. One third of distributed profits at The Walker Group go to employees. One third goes to nonprofits solving community problems. And one third to shareholders. If we could get him to set the example, I think others would follow. What do you think?
It would be wonderful.
🤣🤣🤣
Agree. Maybe I'm misinformed, but I thought the pandemic relief legislation was intended to help ordinary people survive the severe disruptions caused by the pandemic without being driven into destitution, not to "heat up the economy."
To his credit, Biden is trying to address the corporate monopoly problem as best he can with executive branch actions. He should be more vocal about blaming greedy corporate leaders for higher prices. Bernie Sanders should also add that to his message, if he hasn't done so already.
Right. Biden has a bully pulpit. He should use it
Here’s Bernie’s article in The Guardian today: https://www.theguardian.com/commentisfree/2022/jan/04/bernie-sanders-labor-strikes
Thank you.
I agree. A few additions. Not surprisingly, the US stands out among "Western democracies" not only in lack of regulation of large corps but the meager often punitive nature of its social supports. When I moved to Canada for graduate studies in 1970s, not only was I a "landed immigrant" and not a "resident alien," but I immediately had free medical insurance founded by Ontario's Progressive Conservatives.
Control of monopolies stopped large in the 1910s with waning of the only Progressive Era and the oddity of breaking of of Bell Telephone 30 years ago.
Finally, so many of our social and political ailments today are aided and abetted by unregulated enormously wealthy social media and Big Tech.
Robert's comments on limits of unemployment and decades-old right wing distortions and blaming the victims underscore why we can't simply compare or trust unemployment (or inflation) rates over time.
Let us hope for a quiet Jan. 6!
As I'm sure you saw, Apple is our first $3 trillion corporation, and Elon Musk made $28 billion yesterday. These sums are hard to fathom when the typical working person is earning $56,000 a year, but they're signs of a system that is no longer functioning in sustainable ways.
It's just mind-blowing...
The system has been failing for a long time. In order for capitalism to succeed one of the requirements is customers able and willing to buy the products and services on offer. If the customer’s income is such that it only just covers the costs of housing, clothing and food, and there is nothing left for discretionary purchases then a large part of the supply chain will slow down, or even stop. That will put workers out of jobs further reducing the customers available. Capitalists need customers, customers need money. If capitalists, like Bezos, Musk and Zuckerberg, used some of their excessive wealth by funding a universal income system, and at the same time capping their own incomes, and corporate profits we would have a system in place that is sustainable. Of course that will never happen. We need regulation and corporations need breaking up before the greedy few gnaw off the hands that feed them.
Apple's pseudo worth grows because it is buying back its own stock, thus inflating value while business alters with rare metal scarce and supply chain problems. This would not be permitted in other "democracies." And Elon Musk is destroying highway safety and space... with no regulation. No one is paying attention to the junking of outer space or regulation of wasteful "space tourism" Only in US (and maybe China)
Musk was credited with about $300 billion in wealth recently; Bezos $200 billion.
Staggering sums -- but brace up! Our net wealth is about $136 Trillion. ( US Fed )
So, thought experiment, we could liquidate Musk or Bezos or one or more of the others who always pop up in these conversations -- even if we liquidate a few of them, the financial impact would be near *zero* in a calm assessment.
$300 billion wouldn't move the needle on the federal budget, not even for one quarter, really. It's about 2 thousandths of our net wealth. That is a comfort to me.
BUT we have to know and use our net wealth to know this!
Progressive income taxes, yes. Laws, yes. Property tax, like 1% to 2% on assets over $5 million, yes, that's only fair, but it is not happening. Liquidation, or massive taxes on unrealized gains, absolutely not.
It gives me no little comfort to see that none of the mind-blowingly wealthy hold more than a couple thousandths of our wealth. Musk is growing toward 1 percent, a concern, but even then.
Take comfort. And, take action to keep things real.
It's maddening. Both Bezos and Musk are pursuing righteous goals and projects, and achieving staggering progress, in my life and our world, one in electric vehicles, and both in space exploration.
In electric vehicles, Tesla has single handedly pushed our country and the world may years closer to eliminating fossil fuel vehicles and their carbon emissions. That seems almost indisputable, to me, and it has been an explicit stated goal from Musk. We should celebrate that.
( Don't believe in climate change? Then just use basic ethics and common sense -- we need to stop dumping crap in the air, to stop dumping crap in the oceans, and to stop dumping crap on the land and in the lakes and rivers. We can do it. )
Jeff was inspired by Gerard K O'Neill, same as I was, at the same old PU, but he was about 10 years later. O'Neill came to our introductory engineering physics course, and projected his slides of huge space colonies made with Saturn V and Apollo technologies, to move humanity out to explore space, using lunar materials instead of wrecking the Earth and our atmosphere, and blew my mind. Truly awesome, I knew I was in the right place. Got away clean, too, I tell ya.
Zero gravity to 1 earth gravity as you like it, unlimited solar energy, very spacious and green, staggeringly beautiful views, just beautiful. Easy low power access to the rest of the solar system. Why? To learn to live with nothing, and to learn more about the universe, and to create new places for humanity to live without wrecking more of our precious world. Planetary bases are not easily suited to humans, wrong gravity and soaked with radiation. They are needed for raw materials, and learning, so there will be some. But a miles long, miles in diameter space colony, essentially a space station done right, could be made to be very livable.
Why not? The list is long. But not: We should spend the money on the Earth! Where do they think the money for space exploration is spent? Cash is piled into rockets and spewed into the sun? Of course not. The money is spent on the earth, mostly in the USofA.
Why not? The long list holds many dangers for human rights and catastrophic action, but that list applies right here on planet Earth, as we can see. Caveat emperor.
One mantra for me is to get capital to those who build lasting value. Musk in particular seems to be a serial creator, and Bezos may end up being known for Amazon web services AWS more than the retail sales and delivery empire. Theranos and crew are just the latest warning on the massive speculative capital investment front. Lies are great investments, for a while, it seems. In addition, in the past few years a Potemkin valley of electric airplane startups has evaporated zillions of investment dollars, for a pursuit that never made sense on the back of an envelope, for one example very near to my heart, with an aerospace engineering master's degree and no airplane companies near Pallor Alter when I received it. ( Got away clean, I tell you. )
Musk has built teams and companies to do what others have failed to do, or have had poor timing. GM and electric vehicles was a failure in my book, not unfortunate timing, but we don't get to re-run the experiment for true scientific assessment, like so many other matters that deserve it.
Musk's team ( not Musk, the teams and companies he started ) has also created -- and deployed! -- a worldwide satellite internet network. You can sign up today! I was in the first commercial rocket company, GCH, and that was a goal of us engineers, on our walks and rambles around the beautiful Bay Area, decades ago. Many funded attempts. Iridium is still working, Globalstar may be, they are no Starlink. Bezos says he will make one too. Musk has one going and growing, others say they will. Talk is cheap, but I'm hopeful there will be true competition. And we should make sure there is, in time.
China and India have recently sent up warning flares over the imminent access to worldwide communications by individual citizens everywhere and anywhere, that is Starlink flying over their heads right now. The bogus claims of the Chinese space station being endangered by Starlink are about politics, not about physics, in my assessment. Those will grow. It will be very curious to see what Musk does with China, one of his biggest Tesla markets and production partners.
For unions, Walmart is top of my list, with McDonald's and other service industries, not Amazon, though it has popped right up there in just the past few years and is in a tie.
Walmart heirs are creating nothing, except maybe un-American trouble. They have a lot of staggeringly rich company. Musk and Bezos, and to some extent Gates and Buffett, are contributing and building with their wealth ( your exceptions noted, Professor, and acknowledging that the exceptions may rule in some charity cases ). But the real disaster in my mind is unbridled untaxed inheritance, as you have detailed from several angles. Chump voters should be most enraged about that. We should remind them, every day.
About 2/3 of new wealth goes to spouses and children, by common sense. Eventually, not so long from now, ALL of new wealth goes to spouses, children, and heirs in general. 60% is the profoundly un-American number I recall from other analyses and presentations you have given us, Professor, and that fraction has grown over the past 20 years as the grotesque and un-American laws to pass wealth without taxes have kicked in. It's worse than a damn monarchy! How can that not enrage regular working voters? Denial is everywhere.
SpaceX is US aerospace reimagined and recreated, very much like the early days of our established aerospace giants, traditional USA -- NOT some radical never-before-seen etc. There were many attempts before it. It's a government contractor, and it is delivering. We see how Boeing is doing as a competitor. They may still deliver, I would not bet on that. No one is keeping Northrop, and Lockheed, and Airbus/ESA, and even Russia, Japan, and China, and other established military industrial complex companies from creating the next generation of space access. They are preventing that all by themselves, and that was very predictable. Nobody is preventing Intelsat or Boeing or SSL from creating Starlink. It's not even close.
So for me, we the people need to capitalize and celebrate the successes of organizations like Tesla and SpaceX and Blue Origin, and their leaders, while making sure they pay their fair share of progressive taxes and treat their people well and lawfully.
running at the keyboard, all for now, best luck to US -- b.rad
ps -- Ok I lied again . . . In 2000 I was hoping my web startup would be valued as many others, but did not see the complete collapse coming, despite the clear lack of sales and profits for most. Likewise, I did not see that others would follow the 'build it and give it away for free and they will eventually pay you zillions' model working so spectacularly well for Google, and FB ( not you TheGlobe.com, Friendster, Myspace . . . ) and Amazon ( no profits! ) and others. . . in 2008 I did not see the housing collapse coming, because it was based on opaque lies and fundamental corruption by a very few trusted ratings companies . . . and on financial instruments like credit default swaps that were and are unregulated disasters waiting to happen . . . I did not see the Volkswagen disaster coming, or the remote possibility that a few engineers and executives could fool the whole world and malign so many employees, investors, and customers. . . and I did not see that Boeing would allow a similarly tiny fraction of its engineers and executives to kill people and throw its reputation in the gutter for who knows how long. So now, the valuations of stocks and bonds are clearly out of whack -- but I can't see why it persists, and I don't see our way out of it. Increased interest rates, to reward savers and reset the economy, are not going to be welcomed by just about anybody in finance leadership. But how else are we going to get back to a robust financial state with good margins for correction?
I was just saying this to my husband yesterday after reading a news article where a huge Corporation was explaining their reasons for "having" to raise prices. My first thought was, why not absorb the loss, for once, instead of raising prices, to ensure continued, steady, profits for the company and CEO? I mean, no company has to raise prices. Small businesses grapple with price raising all...the...time because they have to face their customers when they do it. Look 'em in the eye and explain. I have been one, trust me, I know. Big corporations don't have to so they don't care. They know we have no choice but to pay for it because we can't take our business elsewhere.
Two anti-trust actions, one against AT&T and the other against IBM gave you the internet and the personal computer. Few people under the age of 65 will remember the days when you rented a telephone from Ma Bell and couldn’t connect any device up to its lines without its approval. If you had a teletype machine or acoustic modem in the early 1970s you could get either 10 or 30 print characters per second as the maximum data rate. There was no improvement in that rate until AT&T was broken up. Similarly with IBM. Anti-trust action forced them to copyright not patent their PC operating system which allowed developers to read the code and create software without the obstacles involved in patent monopoly. Prior to that you needed mega bucks and a computer center to develop software.
Just these two anti-trust actions enabled the development of technologies central to the economic growth that began in the 1980s and 90s.
Our form of capitalism is falling apart. We allow corporations to capture regulatory agencies and engage in pricing power monopoly practices completely uninhibited by monopoly regulations.
In state capitalist China the State has the right to tell private companies where they can source their capital. It can stop IPOs and clamp down on anti-competitive practices.
Here regulators and Congress persons routinely cycle in and out of corporate offices. Like Manchin they have a stake in ending or gutting regulations that prevent corporations from dictating what government will and will not be allowed to do.
When I ask the Democratic Party centrists to explain how they plan to reform this mess the only answer I get is elect more Democrats. We are supposed to tell the blue collar workers making $7.25 an hour to vote for the Democratic Senator that voted to take the $15 an hour minimum wage out of BBB bill.
It always amazes me that the centrists in the Democratic Party are oblivious to this impossibility.
If the centrists in the Party grasped the necessity for reform we would have candidates that could win back the voters abandoning the Party.
Does anyone else think we've failed to or forgotten about antitrust legislation and how it should be applied?
I think we've never learned or perhaps even considered that our antitrust environment may have been suitable for prior centuries, but we're not updating that environment for the evolving global corporate
/ digital landscape. Once those laws had some 'teeth'. Now?
The “Democratic” Party is only the lesser of two corporate parties. The battle is not between “progressives” and “centrists”, but between corporations and people. Most legislators of both parties are wholly owned subsidiaries of corporate power. The movie Don’t Look Up captures so well the mess we are in. Corporations, government and the MSM are all conspiring against our survival. We could vote our way out of it, if the election system itself weren’t so corrupted. Three sitting Supreme Court justices started out their careers helping Bush steal Florida. https://jennycohn1.medium.com/the-2000-u-s-presidential-election-was-a-harbinger-of-things-to-come-fecb1de53fa8 The 2000 U.S. presidential election was a harbinger of things to come.
Allegra. Thank you for your thoughts. I have not seen the movie yet but looking forward to watching. I believe it hit the nail on the head from what I have read.
1. more unions; 2. limit the terms for legislators & the Supreme Court; 3. hold legislators responsible for financial gains made during their terms in office; 4. give each candidate an equal set amount of tax-payer money and media time - no private money in elections; 5. make legislators live the life of a single mother trying to support 3 kids while working 3 jobs just to keep a roof over their heads and food on the table - maybe 6 months should do it, assuming they learn something during that time.
They wouldn't last a week...🤦♀️
People shouldn’t have more money to spend? Seriously? Okay, fine. Then let’s raise taxes on wealthy people and corporations so they have less money to spend on their mega mansions and overpaid CEOs.
I am stymied by the fact that our news media isn't telling the real story about inflation!
Yes, where is the Media?
Donald Trump incited the insurrection of our Capital in a failed attempt to remain in office as President. There is no dispute. What is more concerning, however, is the total denial by the Republican Party’s leaders of this attempted coup. Only two Republican members of Congress – Liz Cheney (R-WY) and Adam Kinzinger (R-IL) – have demonstrated the courage to put country above party and serve on the January 6th Committee investigating the insurrection. When one of our countries’ major political party’s is willing to accept, and even promote, lies about the integrity of our elections we no longer have a democracy.
Consider also that most Republican’s wrongly believe:
• The vaccine to be more dangerous than the virus,
• That masks are harmful, not helpful,
• That global warming is a hoax,
• That tax breaks for billionaires helps the middle class,
• That Laws to suppress the votes of the poor and people of color are necessary to prevent voter fraud.
And finally, the Republican Party is also responsible for the growing distrust of elected local government officials and school boards with the clear intent to divide us even more than we already are.
The question that begs an answer is why?
They hear this in the Republican "bubble" of Fox News (and other right wing cable channels), talk radio (thousands of stations across the country), and social media websites (Revolver, for example).
I agree with the problem but (who am I to disagree with Robert Reich?) maybe not the solution of increasing taxes on corporations and/or the super-wealthy without effective safeguards against them being able to move out of the U.S. to avoid these taxes and to keep them from passing these taxes also onto consumers. The fundamental problem, as it has been forever, seems to me to be how to get more people to recognize the problem of being taken advantage of people in power then to act on it- in our system at least for now by voting. Monopoly/oligopoly/collusion power creates price inelasticity which forces people to pay high prices or to consume less which would cause a depression although be better for the environment and maybe make us happier beyond basic needs if I'm thinking this through correctly. BTW, I'm terrified by the Republican Party. However I no longer support the Democratic Party, only individual candidates and coalitions, because "our" party seems to have abandoned core values of competence, courage, benificence, and appreciation of disagreement and the worth of others in far too many cases.
Anti-monopoly laws (antitrust) are slow, because cases are inevitably slow, but they're critical.
If big corporations that don’t pay federal taxes move their headquarters to other countries, let them go! They will continue to want to sell their goods and services to the USA. In response, a pro-active federal response would be to disallow them from selling to the USA if they have departed the USA. But like you, I’m confident that the Democrats don’t have the vision to do such a helpful thing.
Well, let’s go back to Economics 101: inflation occurs when too much money is chasing too few goods and services.
So why is there “too much money”? Our debt-based currency system depends upon monetary cycles. New money enters the economy through government spending and loans through the banking system. This money fuels the economy, but then has to exit the system so the next round of financing can happen.
This “old” debt is supposed to be retired through a combination of loan repayment and taxation. However, as the Middle Class shrinks and real wages stay flat in an expanding economy, tax revenue shrinks and debt repayment is increasingly distressed. At the other end of the economic spectrum, the uber-wealthy are reluctant to give up even a penny of wealth, so find ever more clever ways to evade taxation.
The result? Like a clogged drain, money builds up in the system and inflation is the result.
The solution? Tax away extreme wealth, on a progressive basis. It’s not about “punishing” success but rather enabling success to be shared much more widely
While things in this country have never been perfect the overall best time for the working class was the postwar boom from 1947-1972. During that time the wealthy and corporations paid a much higher tax rate, as much as 70% for wealthy people in the 1940's and 1950's. It is interesting how the news media, including people like Jake Tapper, Wolf Blitzer, Erin Burnett, and Anderson Cooper at CNN, as well as many others in the mainstream news media at all the stations never report that. Also during that time Unions had much greater power than they do now.
Exactly, Brian. The mainstream news media suffers from an ahistoricity of sorts. The constant churn of the cable news media keeps the conversation focused on the immediate moment and rarely zooms out to provide a broader context.
This response is from a Guardian thread and is a slight deviation from the core issue of Potterizing but includes ideas regarding the power of corporations and how unions were demonized in order to subvert the middle class.
Dr. Reich exposes another of the beloved lies in the US: that unions are the cutting edge of communism or even worse, socialism. Unions were formed to end worker exploitation, and one of only many battles was fought with Henry Ford that was 'ended' in 1941 with the impending war. The settlement was at the figurative point of a cocked and loaded gun to Ford's head. Patriotic? Change of heart? Ha. As noted in prior comments, the corporations just change locations if and when they can and demand a subsidy in doing so.
Are the plutocrats really that crass? They assume the most extreme position possible in order to negotiate on what appears to be conciliatory measures. This has been observed throughout history. A noted economist:
When the final result is expected to be a compromise, it is often prudent to start from an extreme position. - John M. Keynes
Of course, power never surrenders the slightest amount of influence without a fight much like the camel's nose is not allowed in a tent. Another economist:
People of privilege will always risk their complete destruction rather than surrender any material part of their advantage. - John K. Galbraith
The rich and influential always bet that their money and connections will save them at the last moment. As an engineer, economist, and data scientist, I have seen [almost] nothing in capitalism and its great leaders that indicate the slightest understanding that people are more important than profits. Capitalist corporations appear to be nothing other than unconscious creations of commercialism, consumption, and greed.
NB - I am not advocating gun violence in any sense - metaphorically or otherwise.
We need some widely publicized charts showing tax rates vs corporate profits vs average wages, vs. ceo pay, all adjusted for inflation, since Reagan's trickle down theory. Maybe throw in union membership as well. It's the "widely publicized" part that's most difficult, because we don't have a megaphone the size of Fox News.