I’m going to put on my fiscal conservative hat here and try to convince you that class-war is a losing proposition. That in my mind means Bernie Sanders has it fundamentally wrong. That is what this post is all about.Read more
I get much of my inspiration about life in the US from the New York Times. They seem to have the best reporting and columnists in the country. That’s why I pay the big bucks ($4/month) for their daily feed. 🙂
The title above came from an column from Gail Collins. It started out with following paragraph.
Department of Irony: Republicans can’t stop howling about socialism. But nobody makes capitalism look worse than Donald Trump.
I couldn’t have said it better. To the majority of international banks Trump is just persona non-grata. He has declared bankruptcy so many times (11) that they just don’t want anything to do with him. About the only bank in the world who will still give him loans is Deutsche Bank. Why is it that they still loan him money? The Mueller team is looking into that and I wouldn’t be surprised if they find something illegal about that. Cohen has already stated that he filed illegal reports to them as to his boss’ wealth.
At this point the bank did a review of Trump’s claim that he was worth about $3 billion and discovered it was more like $788 million…
The skyscraper got built, but nobody seemed to want to live there. Trump, who had personally guaranteed $40 million of the loan, then went to court, pointing to a clause in the contract that said he wouldn’t have to cough up the money in the event of a natural disaster. And what about the recession? Was that a natural disaster or what?
Onward. More loans from Deutsche Bank. Some of which he used to pay back … Deutsche Bank. Nobody seemed to think that was crazy.
So, what’s the problem here? Anat Admati, a professor at the Stanford Graduate School of Business, said she found it shocking that “a corporation the size and complexity of Deutsche Bank is so poorly governed.”
The bank, however, didn’t run for president on the basis of its financial genius. Trump did, and it worked so well he is now running around making speeches about reducing business regulation.
Source: New York Times
I imagine there are many real capitalist around who hate the fact that the “proudly ignorant” voters out there consider his capitalistic traits make him worthy to be president. I suspect they are laughing and crying at the same time.
The two major things that drive the US economy are personal consumption and military spending. With this post, I will try to convince you that is a basic problem for us as a country. It thwarts happiness and is a wasteful way to live a life. But the biggest problem is that for too many of us it is the ONLY thing driving our lives. More money, more stuff.
Ironically this is true throughout the economic ladder from the richest of us to the poorest. We think that if we can just get a few more dollars to buy more stuff everything will be better. Most of us have been thoroughly indoctrinated into consumer driving capitalism. For many of us, contrary to what the philosophers say, money can buy happiness, at least temporarily. Or so we believe…
For those on the lower end of the economic spectrum it is another flat screen TV; for those on the upper end, it is a new $50,000 car to replace the two-year-old one we currently have.
Believe it or not, there are other parts of the world that take a very different approach to capitalism. They don’t depend on all of their citizens spending more and more year after year. Instead, much of the profits of their version of capitalism is used for the overall good of the country and its citizens. Those countries have an infinitely better infrastructure. Potholes and failing bridges are not the norms for them. Even more importantly they provide health care for all their citizens and security for their senior citizens. Every statistic taken shows that they are much happier than we are even if they don’t have multiple storage lockers filled with junk.
How do we as a country get out of the “more and more” mentality and into something that makes us happier? That is the question of the day for me.
This post is about the question “Is America’s form of capitalism being pushed aside?” Is the world moving beyond the American definition? Some might say the Capitalism as it exists in America is “The rich get richer, and nothing else matters…
“What happens when a society reinvests the gains from industrialization into things like healthcare, education, and so forth? Well, it’s economy changes — radically. You see, the American economy is still 75% consumption — McMansions, SUVs, designer jeans, and so forth. The problem is that 80% of Americans live paycheck to paycheck. They can’t afford those things anymore. But if America had invested in public goods, then the economy would be made less of consumption, and more of investment.
I like to blame all of our problems on #CO3 but I recognize that our “consumption” problems are ingrained in our capitalist system. The “rich get richer” and “survival of the fittest” is a dominant part of our version.
Our version of capitalism will likely change in the coming years. One path will be divorcing ourselves from the rest of the world. Going it alone. Another path is that our capitalist system may morph into the version practiced by Western Europe, Scandinavia, and Canada as cited in the source article.
So, what is the basic difference? These countries practice what some may call social democracy. They give all their citizens what they see as inalienable rights. They include healthcare, education, transportation, and retirement. Because these rights are endemic in their version of capitalism they divorce themselves from the “survival of the fittest mentality”. I think we have some things to learn from them in that and many other regards.
#CO3 = Current Oval Office occupant
I ran across the title of this post in an article by Fraser Nelson of The Daily Telegraph which is a popular British newspaper. It basically talks about how the Brits are now leaning to the left despite the relative win of the rad-cons in the recent election. This leftward trend is evidently being pushed by the young voters in the country.
I kinda think the Brits are smarter than us when it comes to government and I hope our young people are doing the same. The basic definition of capitalism is that it is an economic system based on private ownership of capital. Dropping back to look at a broader view of this system, when all the capital ends up in the hands of a relative few then it morphs into an oligarchy and that is something that the Brits also know about.
An oligarchy is pretty much the opposite of a democracy in that the people without capital have little or no control over government decisions and actions. That happens because money controls information as it does pretty much everything else in a capitalist society.
The general feeling today, at least among RedAmerica, is that anything that is not driven by capital (read money) is somehow an enemy of the state. To them, it seems logical that a capitalist state should be run by a billionaire as they are the only truly successful ones among us. I’m sure that logic was part of what got us into the trouble we are now facing.
Going back to the original thoughts on this post, I hope our young people have a similar attitude as those in Britain. I know I started out in the opposite mode and as I grew in wisdom I turned left to a more people-oriented view. My votes during my first three presidential elections were for the GOP candidates. It was not until Reagan and his brand of conservatism that I basically made the switch. Of course, seeing where we are today I would love to go back to Reaganism, even with his trickle-down politics.
I do still believe in capitalism but we need to have reignes on that horse or it will morph into an oligarchy. There just seems to be something about wealth accumulation that once you have a certain amount it turns into an urgent rush to get even more. In my mind, that is where the dangers occur. It is hard to remember that the 90% estate tax along with excise taxes were once the primary source of revenue to run our governments. Taxing the workers didn’t occur until one hundred years ago.
In today’s world where 1% of the population control the majority of the wealth, its time for some “real” tax reform. The current proposal being ramrodded through Congress is in no way a real reform. We will never get that until our political parties can come together with compromise solutions. I think our young people today can see this much more clearly than I did when I was their age.
If you are one of those who don’t have capital, it’s hard to gung-ho about it…
But, first, let’s look at an unusual way of running a business, by having your employees own the company. One popular craft brewery has made a name for itself in part by going that route, with strong results so far….
One of things that we think is a big societal issue is this widening gap between the haves and the have-nots. And we realized that we had an opportunity to support people owning something that was increasing in value. Shared equity has been an incredibly powerful engine for us….
The better I do, the better we do, and I personally take that to every day of my job, and it really does inspire us all to go above and beyond in a way that I haven’t experienced at other employers….
Shared equity vs pure capitalism is a very thought provoking idea to me. Especially in the circumstances where we find that today’s capitalism returns are overwhelmingly skewed to the top 1% of our citizens. It is just not being shared by the people who are actually creating the wealth as it once was. Will shared equity become the new capitalism in the future? I can only hope so; it would indeed solve many of the social issues of our times.
In my day “the three legged stool” was the symbol for a successful enterprise. The three legs were Owner/Employees/Customers. Each had equal weight in corporate prosperity. If something is beneficial to all three then it was quickly implemented. Over the years the Customer leg has been shortened. If something can be made for a penny less and the product will still last at least through its warranty period it is cost reduced. Product longevity and quality is missing from far to many capitalist institutions.
The Employee leg of the stool has been ruthlessly amputated. As profits rise they are never shared by those who generate them. In fact brutal downsizing has become the mantra. The median income for U.S. families has actually decreased significantly while profits sour.
The only leg getting attention now is the Owner or stockholder. He is the king of capitalism as shown by the massive increase in wealth of the ultra-rich in our society. It seems the only way to straighten out the three legs is to make the employees the owners. With shared equity another thing that diminishes is the constant need to grow profits. The new owners will usually be satisfied with a constant income and not be obsessed with more and more. It is obvious that many business fail because they tried to grow too fast.
Our industrial society started out as a cottage industry. Small businesses were built based on local needs. Maybe it is time to start heading back in that direction. If you ask me “Too Big To Fail” is a formula for the implosion of capitalism. How to make shared equity once again happen is the question of the day. The first answer is probably to force politicians to join Bernie Sanders and Elizabeth Warren in realizing that shared equity appears to be our only viable future.