Well said.I should probably pick on the DEA soon too.Just reading the "War on Drugs" wiki article is funny enough. Every few years the DEA requests a progress report from RAND. Every few years, RAND tells them that the War on Drugs leads to the narco cartels making record profits while being an absolute waste of an obscene amount of US resources. Every few years, the report is ignored. Rinse, repeat, ad nauseam. wiki
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New American editorial: auto bailoutsThe weak point in this argument is the Canadian connection. The article wants to paint this as Democratic socialism in action...but if that was the case why was a right leaning Canadian conservative government on board and doing the same thing?
In effect I suspect that, while the nitty gritty details may have been slightly different, there would have been a bail out just the same even if the Republicans had won the presidency.
That's certainly possible. Bush shares the guilt for TARP, and McCain voted for it too, IIRC. So Bush and McCain are definitely not limited government, free market advocates.
My understanding of Canadian politics is quite limited, but it looks like Canadian conservatives are quite comfortable with Democratic socialist policies like socialized medicine and nationalizing industries from my limited perspective.
I'm certianly not arguing that this was some how libertarian, I'm simply pointing out that its not some how specific to the left wing of the Democrat party and would probably be embraced by most of the democratic party and easily falls under the the left wing of the Republican Party.
New American editorial: auto bailoutsThe weak point in this argument is the Canadian connection. The article wants to paint this as Democratic socialism in action...but if that was the case why was a right leaning Canadian conservative government on board and doing the same thing?
In effect I suspect that, while the nitty gritty details may have been slightly different, there would have been a bail out just the same even if the Republicans had won the presidency.
That's certainly possible. Bush shares the guilt for TARP, and McCain voted for it too, IIRC. So Bush and McCain are definitely not limited government, free market advocates.
My understanding of Canadian politics is quite limited, but it looks like Canadian conservatives are quite comfortable with Democratic socialist policies like socialized medicine and nationalizing industries from my limited perspective.
I'm certianly not arguing that this was some how libertarian, I'm simply pointing out that its not some how specific to the left wing of the Democrat party and would probably be embraced by most of the democratic party and easily falls under the the left wing of the Republican Party.
I would have to agree.
I think the Republican party has betrayed its core values of limited government and fiscal sanity.
I think the 2 party system does a very bad job for America.
How about "free market capitalist folly" for your next such thread?
You could cover such great private sector accomplishments like the upper big branch coal mine explosion -- or all the jets that aren't getting their proper maintenance, or BP's oil spills (yes plural) -- perhaps Berny Madoff could make a cameo as well. Then we can get into Wal-mart firing pregnant women for being pregnant, and mental hosipitals that purposefully under staff so they make more money charging insurance for the number they are supposed to have and not having to pay those who aren't there.
Maybe then branching out internationally to have fun with the Chinese milk that isn't milk fun, among other things.
How about "free market capitalist folly" for your next such thread?
You could cover such great private sector accomplishments like the upper big branch coal mine explosion -- or all the jets that aren't getting their proper maintenance, or BP's oil spills (yes plural) -- perhaps Berny Madoff could make a cameo as well. Then we can get into Wal-mart firing pregnant women for being pregnant, and mental hosipitals that purposefully under staff so they make more money charging insurance for the number they are supposed to have and not having to pay those who aren't there.
Maybe then branching out internationally to have fun with the Chinese milk that isn't milk fun, among other things.
You're welcome to start such a thread, and I would be happy to contribute to it. Although I have some trouble seeing the PRC as some kind of unregulated free market.
BP has a dreadful EH&S record in my opinion, and Massey had long term failures in safety process and life safety engineering controls, but what responsibility does MSHA have? They cited Massey repeatedly but let the operations continue without correcting major safety failings. The primary responsibility clearly lies with Massey, but I hardly think MSHA's hand are clean and government report says as much.
I've commented in detail regarding Deep water Horizon and Texas City up thread. Pro Publica has some very good reporting on this.
I think your idea for a thread is a fine one, but I would point out that all your examples seem to be heavily controlled by government already, and that didn't seem to head off the problems.
EDIT: "Corporate stupidity and corruption" might be a good thread title as well. There is no shortage of both in rent seeking corporate America and internationally.
You're welcome to start such a thread, and I would be happy to contribute to it. Although I have some trouble seeing the PRC as some kind of unregulated free market.
In a lot of ways it is. The Government is trying to govern a state that it is really not currently capable of fully doing. Hence much of the time its the wild west out there, sure you'll have to grease a few palms along the way but make sure the right palms are greased and you'll never have to worry about government oversight in a great many areas, unless your caught in some huge scandal like selling baby formula that is not actually milk but dangerous chemicals (which happened) after which the government will come down on you like a ton of bricks and you'll be lucky to get away with just a long prison sentence as opposed to being shot (actually I'll have to look up how many people China shoots - I'm not really sure what they do in terms of capital punishment).
Its a case of government regulation being everywhere but enforcement being nearly non-existent.
You're welcome to start such a thread, and I would be happy to contribute to it. Although I have some trouble seeing the PRC as some kind of unregulated free market.In a lot of ways it is. The Government is trying to govern a state that it is really not currently capable of fully doing. Hence much of the time its the wild west out there, sure you'll have to grease a few palms along the way but make sure the right palms are greased and you'll never have to worry about government oversight in a great many areas, unless your caught in some huge scandal like selling baby formula that is not actually milk but dangerous chemicals (which happened) after which the government will come down on you like a ton of bricks and you'll be lucky to get away with just a long prison sentence as opposed to being shot (actually I'll have to look up how many people China shoots - I'm not really sure what they do in terms of capital punishment).
Its a case of government regulation being everywhere but enforcement being nearly non-existent.
In many ways it reminds me of the US. We have literally millions of regulations on basically every aspect of our lives. We spend tens of billions of dollars on regulatory agencies (hundreds if you include the war on drugs) every year, but these regulatory structures are abysmal failures that are surround by even more layers of incompetent and corrupt bureaucracy running into more hundreds of billions per yer. In theory we are absurdly over-regulated, but in practice the biggest most corrupt corporations and criminal enterprises are the least likely to be regulated and punished for wrong doing. It all seems disturbingly fascist to me.
In many ways it reminds me of the US. We have literally millions of regulations on basically every aspect of our lives. We spend tens of billions of dollars on regulatory agencies (hundreds if you include the war on drugs) every year, but these regulatory structures are abysmal failures that are surround by even more layers of incompetent and corrupt bureaucracy running into more hundreds of billions per yer. In theory we are absurdly over-regulated, but in practice the biggest most corrupt corporations and criminal enterprises are the least likely to be regulated and punished for wrong doing. It all seems disturbingly fascist to me.
In my opinion it is because the regulators don't actually have the means to actually enforce anything. When the do try it goes straight to court where the corporations involve keep it in legal limbo by not appearing, not providing documents they are supposed to, stalling on every technicality possible, and saying, "I didn't know."
Honestly I feel that a CEO and Board should be ultimately responsible for the company's actions no matter what those actions are. There should never be a honest legal case of, "I didn't know what my company was doing."
It strikes me that at the point you are in such a position a claim of ignorance should be considered an admission of negligence.
Regulation should be as bare as possible, but impossible to get around with actual power to back such a position up -- "These are the minimums, you will abide or you will cease to be -- no questions, no arguments, no exceptions."
Corporations have no loyalty to anything but profits. The idea of self-regulation is absolutely laughable.
My opinion is that a corporation is nothing more than a private form of government for a specific subset -- and as any government it should be view with suspicion.
In many ways it reminds me of the US. We have literally millions of regulations on basically every aspect of our lives. We spend tens of billions of dollars on regulatory agencies (hundreds if you include the war on drugs) every year, but these regulatory structures are abysmal failures that are surround by even more layers of incompetent and corrupt bureaucracy running into more hundreds of billions per yer. In theory we are absurdly over-regulated, but in practice the biggest most corrupt corporations and criminal enterprises are the least likely to be regulated and punished for wrong doing. It all seems disturbingly fascist to me.In my opinion it is because the regulators don't actually have the means to actually enforce anything. When the do try it goes straight to court where the corporations involve keep it in legal limbo by not appearing, not providing documents they are supposed to, stalling on every technicality possible, and saying, "I didn't know."
Honestly I feel that a CEO and Board should be ultimately responsible for the company's actions no matter what those actions are. There should never be a honest legal case of, "I didn't know what my company was doing."
It strikes me that at the point you are in such a position a claim of ignorance should be considered an admission of negligence.
Regulation should be as bare as possible, but impossible to get around with actual power to back such a position up -- "These are the minimums, you will abide or you will cease to be -- no questions, no arguments, no exceptions."
Corporations have no loyalty to anything but profits. The idea of self-regulation is absolutely laughable.
My opinion is that a corporation is nothing more than a private form of government for a specific subset -- and as any government it should be view with suspicion.
In my experience regulators have immense power, but they tend not to use it proactively. For example, OSHA and the courts can and will send people to prison, but in many regions they have shifted their focus to generating revenue through issuing fines. The net result is that almost none of their efforts contribute to site safety, and they only use the big stick after someone gets maimed or killed. Furthermore, this administrations OSHA has explicitly stated that their goal is not to educate businesses and contractors to create safer working environments, but to punish businesses for violations. There are many other specific major flaws in how different regions conduct their mission, but I'll leave OSHA be for now.
In the safety field the idea of some degree of self regulation is far from absurd. Great safety records open doors to very large contracts. Poor recordable rates close doors in an extremely competitive environment. Insurance companies do far more to improve job site safety than government. It's hardy some kind of corporate altruism, but it is an example of free markets responding to incentives some of which are created by government and the courts.
I think corporations, governments and all concentrations and centralizations of power should be viewed with suspicion.
One of my driving concerns is that an invasive, massive, corrupt, and incompetent state facilitates a corrupt, incompetent, and unaccountable corporate culture.
In my experience regulators have immense power, but they tend not to use it proactively. For example, OSHA and the courts can and will send people to prison, but in many regions they have shifted their focus to generating revenue through issuing fines. The net result is that almost none of their efforts contribute to site safety, and they only use the big stick after someone gets maimed or killed. Furthermore, this administrations OSHA has explicitly stated that their goal is not to educate businesses and contractors to create safer working environments, but to punish businesses for violations. There are many other specific major flaws in how different regions conduct their mission, but I'll leave OSHA be for now.
In the safety field the idea of some degree of self regulation is far from absurd. Great safety records open doors to very large contracts. Poor recordable rates close doors in an extremely competitive environment. Insurance companies do far more to improve job site safety than government. It's hardy some kind of corporate altruism, but it is an example of free markets responding to incentives some of which are created by government and the courts.
I think corporations, governments and all concentrations and centralization of power should be viewed with suspicion.
One of my driving concerns is that an invasive, massive, corrupt, and incompetent state facilitates a corrupt, incompetent, and unaccountable corporate culture.
My experience has been that corporations don't care about your safety -- only their bottom line. If it wasn't for the fines and possibility of you suing if injured while on the job they wouldn't give a rat's rear about what happened to you.
The companies that I have worked for in the past (and present) have documented safety risks that never get fixed -- until after someone is injured. To be clear the documentation and recommendations for fixing these risks were in place before the accidents in every case -- but the company refused to act because of the costs involved with fixing the situation.
In fact I know of one company I will specifically call out -- North American Green was such a bad place to work that before I left they were finding it impossible to find workman's comp insurance. The people that provide workman's comp for mines, police, fire departments and the like refused to cover NAG because it was too risky.
OSHA would come in and they would have the check for the fines ready -- when asking about hearing protection due to the heavy machinery the response I received from the supervisor was, "We don't provide or allow hearing protection because you might not hear someone scream if they fall into the machinery."
This is the worst case scenario that I have -- however every other company I have worked for has been similar in approach of safety.
Profits actually drive the hope for 'unskilled laborers' (read factory workers) being driven off by companies through injury or maltreatment -- after all if the person doesn't stay for longer than 5 years you are unlikely to have to pay benefits in the form of vacation time (in large sums), 401k contributions, long term health insurance (for the injuries you allow to continue to be inflicted on your work force), and higher pay. Profits tell you that you don't want to pay these things -- so drive off the people you can and keep the work force fresh so you can pay them less -- with fewer benefits.
Is there any reason they couldn't do that through layoffs rather than injuries? I would think that layoffs would be cheaper than sky rocketing insurance, workman's comp, and lawsuits. I wonder how much was malice and how much might have been simple incompetence. I have seen companies that don't think safety is cost effective. I think they're stupid, but I can't deny their existence by any means. Different business models can have radically different safety cultures. I have seen both extremes in IC wafer fab and other industries.
Is there any reason they couldn't do that through layoffs rather than injuries? I would think that layoffs would be cheaper than sky rocketing insurance, workman's comp, and lawsuits. I wonder how much was malice and how much might have been simple incompetence. I have seen companies that don't think safety is cost effective. I think they're stupid, but I can't deny their existence by any means. Different business models can have radically different safety cultures. I have seen both extremes in IC wafer fab and other industries.
Yeah I don't mean to say all companies are absolutely horrible and want you dead -- but there are enough out there that don't give a flip about their employees (seeing them as a debt to be paid rather than an asset to be carefully managed and used) -- I'm a firm believer in the saying, "Never assume malice for what ignorance can explain" but at some point ignorance becomes willful and malice in practice and purpose.
Layoffs have their own sets of issues too -- first it can look just as bad as a high turn over rate -- in fact it looks worse: It shows poor management of resources and an inability to read the market, as well as providing several former employees with the means to seek unemployment or retraining compensation (ask Whirlpool about their Evansville plant they shut down and are still paying people for). If you can instead 'shake them off' through willful ignorance and avoidance of fixes then it becomes their fault for leaving and you can make it look like the industry/area has a high turn overrate instead of just your company... meaning it's par for course instead of something you are doing.
This is also why companies have become so draconian about their attendance policies: It is an easy way to shake out people that have been at the place a long time. A few slip ups and "oops you're unemployed, not our fault, now we'll hire someone cheaper to do your job."
I agree attendance is important -- but a specific company I can point out has the following sick day policy: "You will be at work if your shift is running on that day. If you are not there it counts as an occurrence, three occurrences is a write up with 3 write ups meaning you are fired. It takes 6 months for an occurrence to fall off and 2 years for a write up. An excuse from your physician will allow three days to count as one occurrence. In addition if you are sick you shouldn't come to work as you might make the other employees sick, or contaminate equipment. Not coming to work will count as an occurrence."
They provide no sick days, and later on in the policy if you aren't available for mandatory overtime it is an automatic write up. If you miss two mandatory overtime days in a row it is grounds for automatic termination. Even if you are in a coma in the hospital no excuse shall be accepted.
That is the literal policy of the company. You don't have a policy like that to help your employees -- you have it to shake them out.
When something is built entirely on the accumulation of capital - which all corporations are - then all else falls second to that. And yes, that includes safety as well.
The problem is that corporations and the fed have a horrifying revolving door, with the corporations often outright writing the very laws meant to govern them. If the US has one problem that towers over all else, it is that there are tons and tons of regulations on everyone but those that need regulations the most.
I agree that we need to starve the beast, but that beast ain't government. A small government is perfect for many politicians - it's too small to defend the citizens against those that would abuse and exploit them.
Is there any reason they couldn't do that through layoffs rather than injuries? I would think that layoffs would be cheaper than sky rocketing insurance, workman's comp, and lawsuits. I wonder how much was malice and how much might have been simple incompetence. I have seen companies that don't think safety is cost effective. I think they're stupid, but I can't deny their existence by any means. Different business models can have radically different safety cultures. I have seen both extremes in IC wafer fab and other industries.Yeah I don't mean to say all companies are absolutely horrible and want you dead -- but there are enough out there that don't give a flip about their employees (seeing them as a debt to be paid rather than an asset to be carefully managed and used) -- I'm a firm believer in the saying, "Never assume malice for what ignorance can explain" but at some point ignorance becomes willful and malice in practice and purpose.
Layoffs have their own sets of issues too -- first it can look just as bad as a high turn over rate -- in fact it looks worse: It shows poor management of resources and an inability to read the market, as well as providing several former employees with the means to seek unemployment or retraining compensation (ask Whirlpool about their Evansville plant they shut down and are still paying people for). If you can instead 'shake them off' through willful ignorance and avoidance of fixes then it becomes their fault for leaving and you can make it look like the industry/area has a high turn overrate instead of just your company... meaning it's par for course instead of something you are doing.
This is also why companies have become so draconian about their attendance policies: It is an easy way to shake out people that have been at the place a long time. A few slip ups and "oops you're unemployed, not our fault, now we'll hire someone cheaper to do your job."
I agree attendance is important -- but a specific company I can point out...
I agree that's crappy, and I agree that happens. I've worked for companies with similar attendance policies.
What do you think the government remedy is?
When something is built entirely on the accumulation of capital - which all corporations are - then all else falls second to that. And yes, that includes safety as well.
The problem is that corporations and the fed have a horrifying revolving door, with the corporations often outright writing the very laws meant to govern them. If the US has one problem that towers over all else, it is that there are tons and tons of regulations on everyone but those that need regulations the most.
I agree that we need to starve the beast, but that beast ain't government. A small government is perfect for many politicians - it's too small to defend the citizens against those that would abuse and exploit them.
I would point out that all corporations are not the same. In some corporations a bad safety record means no business. Safety is functionally a prerequisite for accumulating capitol. There are corporations whose sole function is safety and regulatory compliance.
I agree that our regulatory structures are corrupt. I said so above. Do you believe giving them more money and power will make them more or less corrupt?
Do you think the US government is too big, too small, or about right?
Abraham Spalding- I really think you should start that thread, I would contribute to it.
BT- Are you saying that we should shrink government by cutting out the corrupt parts? Departments and regulatory agencies that have a proven record of inefficiency, corruption, and conflict of interest issues? Because Im 100% behind that. Cut them and replace them with a leaner regulatory agency with a powerful oversight board that forces them to do the job they are supposed to do with full transparency.
Abraham Spalding- I really think you should start that thread, I would contribute to it.
BT- Are you saying that we should shrink government by cutting out the corrupt parts? Departments and regulatory agencies that have a proven record of inefficiency, corruption, and conflict of interest issues? Because Im 100% behind that. Cut them and replace them with a leaner regulatory agency with a powerful oversight board that forces them to do the job they are supposed to do with full transparency.
That would be a good starting point, but I think it should be cut back to its constitutional limits.
The case law on the commerce clause and general welfare clause is so FUBAR it beggars description.
I think the best example of the tortured new logic of the commerce clause is this. If someone grows some plants in their basement and consumes all of the product of these plants in their basement they can go federal prison for a violation of a law justified by courts in the interstate commerce clause. How is that even remotely sane?
Just to throw my 2 cp in: in my experience working with shipyards, safety is a top concern. It's always right there at the top with all other considerations, and usually comes out on top. Maybe that's because most of the shipyard work I see is for the Navy, but there you go.
In my experience there can be a huge amount of variability in safety cultures even within similar trades, unions, and industries.
I would point out that all corporations are not the same. In some corporations a bad safety record means no business. Safety is functionally a prerequisite for accumulating capitol. There are corporations whose sole function is safety and regulatory compliance.
I would like to believe this -- but it is functionally dead. If what you were saying the company that ran the upper big branch mine would have been defunct before it exploded -- NAG would have been defunct before they almost killed a kid -- BP would have been defunct long ago, and Toyota would be gone today.
As much as I wish safety was somehow linked to profits in a positive correlation (the better the safety the better the profits) it is sadly not the case.
There is a reason companies consider it 'taking a hit for safety' instead of 'raising a profit by safety'.
On the topic of government regulation -- I agree that the regulators need to have knowledge of the industry they regulate -- however it is imperative to me that they not be allowed to work for the industry after their service as a regulator at all.
One issue is the pay rate for government service -- which is far below that of the private industry. Even teachers who supposedly 'make lots' (which is an obscene joke) honestly do not when you account for the regular extra expense of continuous education and certification requirements.
Honestly a teacher has to go through as much crap to teach as a doctor does to become a doctor -- only once the doctor is a doctor people don't bother him unless he starts regularly screwing up -- the teacher is required to continue jumping through hoops year in and year out on his own time and money in addition to doing his actual job (plus the mandatory volunteering for after school programs and the like -- nothing like forcing free labor).
I think the regulation portion of the government is honestly too small -- there is not enough actual regulators to honestly inspect and case each part of the industries they are supposed to regulate.
The USA people need to decide how much they value their safety and then face the fact that having that level of safety requires actually paying people to do the job correctly with the tools needed to do it.
It's the same with our infrastructure -- people complain and harp about the state of the roads, sewer lines, electrical systems and the like, but refuse to pay any more than the absolute minimum to keep it running to the absolute minimum bidder.
It's like wanting a million dollar mansion and hiring some guy that comes up and offers to build it for you for only 100,000 dollars including construction materials -- you really can't complain about the outcome.
I would point out that all corporations are not the same. In some corporations a bad safety record means no business. Safety is functionally a prerequisite for accumulating capitol. There are corporations whose sole function is safety and regulatory compliance.
I would like to believe this -- but it is functionally dead. If what you were saying the company that ran the upper big branch mine would have been defunct before it exploded -- NAG would have been defunct before they almost killed a kid -- BP would have been defunct long ago, and Toyota would be gone today.
As much as I wish safety was somehow linked to profits in a positive correlation (the better the safety the better the profits) it is sadly not the case.
There is a reason companies consider it 'taking a hit for safety' instead of 'raising a profit by safety'.
I'm going to try to break up my replies.
It is not functionally dead. It varies greatly. You cite some great examples of gross malfeasance, but the fact remains that for many businesses a bad safety record means bankruptcy or bail out. Others get away with murder for all intents and purposes. This is not to excuse the latter, but to say all (or virtually all) businesses care more about profits than safety is too broad a generalization to defend. There are still lots of businesses that are exactly guilty of exactly what you say, but there are many very real exceptions.
Many contractors realize that safety is an investment that makes them much more competitive. I have worked for contractors that have landed multimillion dollar contracts because their competition was eliminated by poor safety performance. I've seen bad safety records bankrupt companies, and I've seen companies who treat their employees like crap and don't give a crap about safety outlast their competition. Free market competition can improve workplace safety through the profit motive. It doesn't always work that way, but it can.
If the regulators that we have in place now are corrupt, inefficient, and have conflict of interest problems, why would we want to pay for more of them? Also, I would have no problem with a regulator who joins the private sector after leaving government service. I do have a problem with regulators who are pulled from the ranks of the private sector they are meant to regulate. (For instance, anyone ever notice that Clarence Thomas never rules against Monsanto in their frequent trips to the Supreme Court?)
I would point out that all corporations are not the same. In some corporations a bad safety record means no business. Safety is functionally a prerequisite for accumulating capitol. There are corporations whose sole function is safety and regulatory compliance.
Yes, but those corporations aren't the ones that have the power, are they? And even then, we are treading very dangerous ground when we are asking officials we cannot choose against electing to care about safety just because we really want them to.
I agree that our regulatory structures are corrupt. I said so above. Do you believe giving them more money and power will make them more or less corrupt?
Yes and no.
Currently the Fed is dramatically underfunded in comparison to corporation law. This is one of the things that fuels the revolving door - you can make almost double the money starting off in corporate law then you would after years of being in the Fed. So, giving them more money can help.
Giving them more power would help exponentially. Right now, the rules the Fed follows are written by the corporations. It's a literal case of the inmates running the asylum. The idea of the free market patrolling itself has been proven rather false by now, I would hope. An independent arm unassociated with corporate America needs to be involved in regulating the market - and it needs power to do it.
However, neither of these will do anything - or even, well, work - if we don't find a means to kill the revolving door first.
Do you think the US government is too big, too small, or about right?
I feel the US government's largeness is located in the wrong places.
I think we need an immediate end to the War on Drugs with a slow move of legality towards drug usage - start with marijuana, move onto less harmful psychedelics, reach the more high end self-harmful drugs while keeping aggressiveness causing drugs like PCP highly restricted. Not only would this make the government's footstep "smaller" it would also do amazing work, at cutting back at the horrifyingly bloated US prison system and begin setting the paving stones for badly needed prison reform.
I think we need an incredible cut back on the US military industrial complex. Like the prison industrial complex, the military industrial complex soaks up a whole damn lot of money, and a very strong portion of it goes towards bureaucracy and unneeded projects.
These are two areas in which the government is "too big," to simply present an example. There are far others.
At the same time, I feel the government needs to provide it's citizens with a safety net and affordable if not free healthcare. I think the government needs to worry quite a lot about unemployment and it's economic situations and that a Monetarism, Austrian, or horrible mish mash of the two in supply side economics has proven to be an outstanding failure at this - a far more controlled economy is needed. I feel that affordable education post-high school needs to be powerfully emphasized, not just in four year universities but in the form of trade schools as well. I think that the current K-HS education system is in shambles at best and needs to be revamped entirely. The US has an abysmal infrastructure that's falling apart more and more daily, which also needs to be repaired.
So I suppose to answer your question, the response is "all of the above." Currently the government is big, but it's big on regressive and ineffectual taxes that kill class mobility and use the taxes it collects to give to leeches like Goldman Sachs, or on ensuring US citizens go to abhorrent prisons and stay there. Currently the government is small, but it's small on things like affordable education, a first world country infrastructure, and first world country health care. Both of these are bad.
In many ways it reminds me of the US. We have literally millions of regulations on basically every aspect of our lives. We spend tens of billions of dollars on regulatory agencies (hundreds if you include the war on drugs) every year, but these regulatory structures are abysmal failures that are surround by even more layers of incompetent and corrupt bureaucracy running into more hundreds of billions per yer. In theory we are absurdly over-regulated, but in practice the biggest most corrupt corporations and criminal enterprises are the least likely to be regulated and punished for wrong doing. It all seems disturbingly fascist to me.
It can be like the US in some places, in some places its probably much worse then the US but I think the areas where it is significantly different are usually the ones of most import and also the most interesting.
The Chinese accept regulation, corrupt as it is and ineffective as it is they accept. They have a culture of government bureaucrats going back to basically pre-history. Its ancient in the extreme.
This is not necessarily true of everyone else and Americans are probably the biggest outliers in this regards in the western world. The result has been a constant ad hoc approach to regulation with two competing value sets - one where Americans demand that 'something be done about X' (usually brought on by a scandal in X) and the other a wide spread belief that regulation and red tape are fundamentally bad and a kind of hero worship of the ideal individual who slices and dices through regulation 'to get the job done'. The result is a pretty schizophrenic approach to regulation that can be exceptionally porous and, combined with the other great American past time (lawsuits) often results in regulation that is really not doing what it was meant to do.
Even this though probably pales in comparison to the actual use of a sizable chunk of the regulation regime - where, far from existing to keep big corporations in check it actually exists to serve them. When one of their members screw up attention is diverted from the rest of the industry by pointing out that the regulators 'messed up' but usually the system has been set up so that the regulators where not expected to actually regulate in the first place. Gung ho members of the regulatory board would get replaced or the system was such that the there was no hope of the small number of regulators actually doing anything of significance in the large industry they where part of.
One of the most extreme examples is in the banking industry...there are six possible regulatory bodies - and they are paid for by the banks themselves...more insanly its a competitive process. Each regulatory body tries to convince the bank in question that they are the 'right' regulator for them. The result is the various regulators compete against each other each promising to be 'better' for the bank in question then the other options. The one the bank thinks is offering them the best deal gets to be their regulator...and then we are surprised when the oversight is not up to snuff...
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Our government is inherently corrupt because every elected official has to raise money and make "friends" and is in debt to special interests before his first day in office. Every one, bought and paid for, with little to no chance of doing the right thing and even the few that CAN get elected on their own money and popularity can do little real good. Change is bothersome, it upsets the status quo that so many love. try to fix the problems like welfare or corporate tax abuse and you just guarantee no reelection.
Even this though probably pales in comparison to the actual use of a sizable chunk of the regulation regime - where, far from existing to keep big corporations in check it actually exists to serve them. When one of their members screw up attention is diverted from the rest of the industry by pointing out that the regulators 'messed up' but usually the system has been set up so that the regulators where not expected to actually regulate in the first place. Gung ho members of the regulatory board would get replaced or the system was such that the there was no hope of the small number of regulators actually doing anything of significance in the large industry they where part of.
One of the most extreme examples is in the banking industry...there are six possible regulatory bodies - and they are paid for by the banks themselves...more insanly its a competitive process. Each regulatory body tries to convince the bank in question that they are the 'right' regulator for them. The result is the various regulators compete against each other each promising to be 'better' for the bank in question then the other options. The one the bank thinks is offering them the best deal gets to be their regulator...and then we are surprised when the oversight is not up to snuff...
On the other hand we have an administration that is rabidly for regulation and massive government. They had control of every branch of government for two years. They expanded the size and power of government massively, but our regulatory structure continues to be really awful. It's still corrupt, incompetent, and infective.
I'd like to learn more about what you're saying the current US banking regulatory structure is.
I would point out that all corporations are not the same. In some corporations a bad safety record means no business. Safety is functionally a prerequisite for accumulating capitol. There are corporations whose sole function is safety and regulatory compliance.Yes, but those corporations aren't the ones that have the power, are they? And even then, we are treading very dangerous ground when we are asking officials we cannot choose against electing to care about safety just because we really want them to.
Sometime those corporations have a great deal of power.
I don't really understand the second sentence.
I agree that our regulatory structures are corrupt. I said so above. Do you believe giving them more money and power will make them more or less corrupt?Yes and no.
Currently the Fed is dramatically underfunded in comparison to corporation law. This is one of the things that fuels the revolving door - you can make almost double the money starting off in corporate law then you would after years of being in the Fed. So, giving them more money can help.
Giving them more power would help exponentially. Right now, the rules the Fed follows are written by the corporations. It's a literal case of the inmates running the asylum. The idea of the free market patrolling itself has been proven rather false by now, I would hope. An independent arm unassociated with corporate America needs to be involved in regulating the market - and it needs power to do it.
However, neither of these will do anything - or even, well, work - if we don't find a means to kill the revolving door first.
How much would you increase regulator pay by? Would you want to give all federal employees a similar raise?
Federal regulators in the fields I am familiar with have an immense amount of power, but they enforce very very selectively. What kind of power do you want them to have?
How do you propose that we close the revolving door? The current administration promised to do it with lobbyists, but they lied to our face. Do you want to criminalize the practice of hiring ex-regulators? Would we imprison the person doing the hiring, the employee or both? If a president appoints lobbyist and corporate figure should the president be imprisoned? If so for how many years per appointment?
I feel the US government's largeness is located in the wrong places.
I think we need an immediate end to the War on Drugs with a slow move of legality towards drug usage - start with marijuana, move onto less harmful psychedelics, reach the more high end self-harmful drugs while keeping aggressiveness causing drugs like PCP highly restricted. Not only would this make the government's footstep "smaller" it would also do amazing work, at cutting back at the horrifyingly bloated US prison system and begin setting the paving stones for badly needed prison reform.
I think we need an incredible cut back on the US military industrial complex. Like the prison industrial complex, the military industrial complex soaks up a whole damn lot of money, and a very strong portion of it goes towards bureaucracy and unneeded projects.
These are two areas in which the government is "too big," to simply present an example. There are far others.
At the same time, I feel the government needs to provide it's citizens with a safety net and affordable if not free healthcare. I think the government needs to worry quite a lot about unemployment and it's economic situations and that a Monetarism, Austrian, or horrible mish mash of the two in supply side economics has proven to be an outstanding failure at this - a far more controlled economy is needed. I feel that affordable education post-high school needs to be powerfully emphasized, not just in four year universities but in the form of trade schools as well. I think that the current K-HS education system is in shambles at best and needs to be revamped entirely. The US has an abysmal infrastructure that's falling apart more and more daily, which also needs to be repaired.
So I suppose to answer your question, the response is "all of the above." Currently the government is big, but it's big on regressive and ineffectual taxes that kill class mobility and use the taxes it collects to give to leeches like Goldman Sachs, or on ensuring US citizens go to abhorrent prisons and stay there. Currently the government is small, but it's small on things like affordable education, a first world country infrastructure, and first world country health care. Both of these are bad.
Where you think the government is too big, I agree. Of course I think all of the federal government is far too big.
Obviously we disagree regarding centralized economic planning. I am mystified by your faith in a corrupt and incompetent government to plan our economy. We certainly haven't had anything close to an Austrian economic model in this country since well before FDR.
Our public education system is indeed a catastrophe, but we have the most expensive education system in the world, and it still sucks. This doesn't seem like a good argument for giving the government more money and power to me.
I would agree that the bailouts where horrible policy, but didn't you say you were in favor of more centralized economic control by the federal government? I think the governments centralized economic planning has been a disaster. I think they have far too much power already.
As for the overall size of the federal government it eats up about a quarter of GDP, and we are still $14,000,000,000,000 + in debt not including the safety net.
How much bigger or smaller should it be?
On the topic of government regulation -- I agree that the regulators need to have knowledge of the industry they regulate -- however it is imperative to me that they not be allowed to work for the industry after their service as a regulator at all.
One issue is the pay rate for government service -- which is far below that of the private industry. Even teachers who supposedly 'make lots' (which is an obscene joke) honestly do not when you account for the regular extra expense of continuous education and certification requirements.
Honestly a teacher has to go through as much crap to teach as a doctor does to become a doctor -- only once the doctor is a doctor people don't bother him unless he starts regularly screwing up -- the teacher is required to continue jumping through hoops year in and year out on his own time and money in addition to doing his actual job (plus the mandatory volunteering for after school programs and the like -- nothing like forcing free labor).
I think the regulation portion of the government is honestly too small -- there is not enough actual regulators to honestly inspect and case each part of the industries they are supposed to regulate.
The USA people need to decide how much they value their safety and then face the fact that having that level of safety requires actually paying people to do the job correctly with the tools needed to do it.
It's the same with our infrastructure -- people complain and harp about the state of the roads, sewer lines, electrical systems and the like, but refuse to pay any more than the absolute minimum to keep it running to the absolute minimum bidder.
It's like wanting a million dollar mansion and hiring some guy that comes up and offers to build it for you for only 100,000 dollars including construction materials -- you really can't complain about the outcome.
So you propose that anyone who ever works for a regulatory agency can never work in the private sector in that field for the rest of their life? What should the prison sentence be? Should the employee and the employer go to prison?
So we need many many more regulators, and we need to pay them much more. How much larger and more powerful would you make the EPA for example?
I'll save the massive failings of the public school system for later.
We currently allow the government to take trillions of tax dollars from us just at the federal level, but our infrastructure still sucks, our public education system still sucks, our regulatory structure is a tragic joke, and our social safety nets are unsustainable. We are constantly told that if we give them more money and power that they will do a better job, but this is almost invariably a lie. The federal government sucks up about a quarter of GDP and we're still more than $14,000,000,000,000 + in the hole and sinking fast. The safety net Ponzi scheme will collapse sooner rather than later.
How much bigger, more powerful, more invasive, and more expensive should our government be? How will we pay for it?
Yes, but those corporations aren't the ones that have the power, are they? And even then, we are treading very dangerous ground when we are asking officials we cannot choose against electing to care about safety just because we really want them to.
Sometime those corporations have a great deal of power.
I don't really understand the second sentence.
Look at insurance companies that regularly drop people from coverage as soon as it comes time to pay.
We cannot trust people whom we do not elect and cannot fire to do what is good just because we really really hope they're going to do what's good.
How much would you increase regulator pay by? Would you want to give all federal employees a similar raise?
Federal regulators in the fields I am familiar with have an immense amount of power, but they enforce very very selectively. What kind of power do you want them to have?
How do you propose that we close the revolving door? The current administration promised to do it with lobbyists, but they lied to our face. Do you want to criminalize the practice of hiring ex-regulators? Would we imprison the person doing the hiring, the employee or both? If a president appoints lobbyist and corporate figure should the president be imprisoned? If so for how many years per appointment?
Long response behind spoiler:
Here's how regulation of Wall Street is supposed to work. To begin with, there's a semigigantic list of public and quasi-public agencies ostensibly keeping their eyes on the economy, a dense alphabet soup of banking, insurance, S&L, securities and commodities regulators like the Federal Reserve, the Federal Deposit Insurance Corp. (FDIC), the Office of the Comptroller of the Currency (OCC) and the Commodity Futures Trading Commission (CFTC), as well as supposedly "self-regulating organizations" like the New York Stock Exchange. All of these outfits, by law, can at least begin the process of catching and investigating financial criminals, though none of them has prosecutorial power.
The major federal agency on the Wall Street beat is the Securities and Exchange Commission. The SEC watches for violations like insider trading, and also deals with so-called "disclosure violations" — i.e., making sure that all the financial information that publicly traded companies are required to make public actually jibes with reality. But the SEC doesn't have prosecutorial power either, so in practice, when it looks like someone needs to go to jail, they refer the case to the Justice Department. And since the vast majority of crimes in the financial services industry take place in Lower Manhattan, cases referred by the SEC often end up in the U.S. Attorney's Office for the Southern District of New York. Thus, the two top cops on Wall Street are generally considered to be that U.S. attorney — a job that has been held by thunderous prosecutorial personae like Robert Morgenthau and Rudy Giuliani — and the SEC's director of enforcement.
The relationship between the SEC and the DOJ is necessarily close, even symbiotic. Since financial crime-fighting requires a high degree of financial expertise — and since the typical drug-and-terrorism-obsessed FBI agent can't balance his own checkbook, let alone tell a synthetic CDO from a credit default swap — the Justice Department ends up leaning heavily on the SEC's army of 1,100 number-crunching investigators to make their cases. In theory, it's a well-oiled, tag-team affair: Billionaire Wall Street A$!@&!# commits fraud, the NYSE catches on and tips off the SEC, the SEC works the case and delivers it to Justice, and Justice perp-walks the A$+#@+! out of Nobu, into a Crown Victoria and off to 36 months of push-ups, license-plate making and Salisbury steak.
Here's why it doesn't work that way: over the past decade, more than a dozen high-ranking SEC officials have gone on to lucrative jobs at Wall Street banks or white-shoe law firms, where partnerships are worth millions. That makes SEC officials like Paul Berger and Linda Thomsen the equivalent of college basketball stars waiting for their first NBA contract. Are you really going to give up a shot at the Knicks or the Lakers just to find out whether a Wall Street big shot like John Mack was guilty of insider trading? "You take one of these jobs," says Turner, the former chief accountant for the SEC, "and you're fit for life."
All of this paints a disturbing picture of a closed and corrupt system, a timeless circle of friends that virtually guarantees a collegial approach to the policing of high finance. Even before the corruption starts, the state is crippled by economic reality: Since law enforcement on Wall Street requires serious intellectual firepower, the banks seize a huge advantage from the start by hiring away the top talent. Budde, the former Lehman lawyer, says it's well known that all the best legal minds go to the big corporate law firms, while the "bottom 20 percent go to the SEC." Which makes it tough for the agency to track devious legal machinations, like the scheme to hide $263 million of Dick Fuld's compensation.
The SEC job probably pays 1/10th what one could make on Wall Street. That's a problem.
Private sector , big-money-firm attorneys tend to look down on attorneys who go into government or public-sector work. They must be s!*&ty attorneys, because they're getting paid half as much, and so obviously they're half as good! What possible reason could a highly skilled attorney have for taking a job where he'd make less money?
When your world is defined by $$$ and nothing else, you assume that's how everyone else defines their world, too.
Where you think the government is too big, I agree. Of course I think all of the federal government is far too big.
Obviously we disagree regarding centralized economic planning. I am mystified by your faith in a corrupt and incompetent government to plan our economy. We certainly haven't had anything close to an Austrian economic model in this country since well before FDR.
In the start of the 1980's we took on supply side economics thanks to Reagan. With our already ill growing military industrial complex, the two became a two hit KO to our economy - the only difference is that this one took far longer to finish knocking us out.
Neo-liberalism is the problem. The free market does not and will not patrol or restrict itself. Greed will always win out in the end.
Our public education system is indeed a catastrophe, but we have the most expensive education system in the world, and it still sucks. This doesn't seem like a good argument for giving the government more money and power to me.
That's because of where the money goes and how the education system is set up. Testing is not the answer to the problem, it's adding another problem on top of already existing problems. The main problems are twofold.
1) Schools are paid by local taxes. This means that schools in poor neighborhoods are bad schools, and that kids who school there get a poor education, which ensures the neighborhood stays poor. A rather awful loop.
2) Overwhelming amounts of money are paid into organized sports programs rather then actual education. We don't have the most expensive education system in the world, we have the most expensive organized sports program in the world that happens to have a school connected at the hip.
I would agree that the bailouts where horrible policy, but didn't you say you were in favor of more centralized economic control by the federal government? I think the governments centralized economic planning has been a disaster. I think they have far too much power already.
Yes, a centralized economy as opposed to a Monetarism economy. The free market is not the answer. The free market isn't the answer to most things, and trying to squeeze an answer from it is trying to produce medicine and rainbows by squeezing a stone. The problem with the bailouts is that they were funneling capital into the big players of the market, not because it was "too centralized." On the contrary, it took funding that should be centralized and de-centralized it.
As for the overall size of the federal government it eats up about a quarter of GDP, and we are still $14,000,000,000,000 + in debt not including the safety net.
How much bigger or smaller should it be?
The problem there is where the money goes. It goes into bailouts or tax cuts or billionaires - while raising regressive taxes that overwhelmingly target the middle class and poor. It goes to funding projects for the MIC so a plane that the military doesn't want can be built across twenty different states in the most inefficient way possible - only to end in a scrapyard because the military didn't want it. It goes to fund prisons instead of schools, encouraging incarceration over education.
It's not a problem of size, it's a problem of where the size is distributed. Corporatism, neo-liberalism, and supply-side economics do not work. The "free market" will not solve all woes. This has been proven time and time again. Yet we still cling to them! It is the very definition of insanity!
Da, da!
This is all very good, very proper, very scientific explanation of shortcoming of Yankee bluejean capitalism.
Only collectively-owned, centralized, planned economy, run by democratically-elected workers' councils and overseen by the dictatorship of the proletariat, can eradicate mass poverty and meth labs amidst Viagra-popping, kiddie-porn, Caligula-like decadence.
Dasvadanya!
Da, da!
This is all very good, very proper, very scientific explanation of shortcoming of Yankee bluejean capitalism.
Only collectively-owned, centralized, planned economy, run by democratically-elected workers' councils and overseen by the dictatorship of the proletariat, can eradicate mass poverty and meth labs amidst Viagra-popping, kiddie-porn, Caligula-like decadence.
Dasvadanya!
Because there's nothing that exists other then the Soviet Union and the US, right?
Unfortunately, Soviet Union no longer exists.
EDIT: I spelled "comrade" wrong! Aaaargh!
This is not to excuse the latter, but to say all (or virtually all) businesses care more about profits than safety is too broad a generalization to defend.
Actually the problem is it is incredibly easy to defend -- all I have to say is, "give them time" and be secure in the knowledge they will flub and proceed to pull another UBPM or BP level systematic approach to avoiding or flouting all regulation in order to make more money.
I have yet to ever see a company take a proactive approach to safety because quite honestly they have but one person to please -- the stock holder -- who is only pleased when his investment makes him money -- therefore the only thing that matters is that money.
Bottom line without the money -- and in the current market the false idea of ever expanding profit margins -- the company fails. Safety flubs and flouting regulation isn't the exception any more -- it is the rule.
Because there is no responsibility in corporate culture -- you pass the buck as fast as possible and take the wealth with you if you get caught.
Unfortunately, Soviet Union no longer exists.
EDIT: I spelled "comrade" wrong! Aaaargh!
Hm... I think they would disagree with you -- besides they never actually managed to become a communistic state -- simply a totalitarian one.
No, Union of Soviet Socialist Republics was never a communist society, nor did it ever achieve socialism by Marxist definitions.
That, however, would be a discussion that would derail this thread.
Let's just leave it at this:
I was agreeing with the good Professor.
No, Union of Soviet Socialist Republics was never a communist society, nor did it ever achieve socialism by Marxist definitions.
That, however, would be a discussion that would derail this thread.
Let's just leave it at this:
I was agreeing with the good Professor.
** spoiler omitted **
I've dealt with far too many people who would say what you said with no irony at all, completely believing that there really is nothing other then EVIL RUSSIA COMMUNISM and GLORIOUS AMERICAN CAPITALISM to so readily take the joke, I'm afraid :<
Professor Cirno, If you are saying that Regulatory agencies should be increased by way of paying the regulatory agents that actually do the jobs that they are mandated to do more and giving them the power to keep out of from under the thumb of the very things they are meant to regulate, I could get behind that.
What I cannot get behind is simply increasing the size of regulatory government agencies. And I also believe that some regulatory agencies should just be done away with. The DEA and BATFE come to mind.
Professor Cirno, If you are saying that Regulatory agencies should be increased by way of paying the regulatory agents that actually do the jobs that they are mandated to do more and giving them the power to keep out of from under the thumb of the very things they are meant to regulate, I could get behind that.
That is what I am suggesting :p
One idea I saw that has like billions of flaws but is so delicious at the same time is giving regulators financial incentive to bust. We complain that Police over enforce against drugs because Police Agencies get to keep portions of things like seized cash. Imagine if SEC members got to keep portions of seized funds from Wall Street crooks in a similar manner. I bet enforcement would shoot up very quickly.
Alternately we could solve the vast majority of our economic woes with a tax reform that stops targeting the poor and middle class with regressive taxes and instead creates a progressive tax that ensures economic equality, thus draining the swamp. On the other hand that would involve taxing billionaires and will thus never happen.
What would you think of the plan to actually reduce corporate taxes (thus keeping the less taxes = more jobs folks happy. IIRC America already has one of the highest corporate tax rates in the world) while simultaneously raising the capital gains tax back to the pre-Clinton levels? (Also IIRC, most CEO's get paid such obscene amounts mostly due to the fact that are not paid in cash, but in stocks and such.)? Would that be something that you believe would work?
Also, we should make this a new topic. I dont want to derail BT's thread.
On the other hand we have an administration that is rabidly for regulation and massive government. They had control of every branch of government for two years. They expanded the size and power of government massively, but our regulatory structure continues to be really awful. It's still corrupt, incompetent, and infective.
Two years is nothing to clean up a mess this size. Nor has regulation been particularly on the agenda in any significant or meaningful way. Beyond that the entire culture, in this regards needs to change.
I'd like to learn more about what you're saying the current US banking regulatory structure is.
Turns out it was four major regulators that compete for service from the banks...and I mean they compete. Below is a link to a picture from an industry event held in 2003.
In the middle of the picture is a large stack of regulatory materials and each of the guys in the picture are showing off their services, they have brought Garden Sheers to show how, if you choose them, they'll slice and dice their way through the red tape.
Pay special attention to the guy on the far left. That's James Gilleran of the Office of Thrift Supervision. Now he really wants these banks (and insurance company's etc.) business...those arn't Garden Sheers, that is a chainsaw he brought to the event. That is quite the message he is conveying - he'll take a chainsaw to regulations if you go with The Office of Thrift Supervision for your regulator. It seems by all accounts the companies that went with the OTS got what they were paying for...most of the big names we heard about during this financial crisis where regulated by the OTS, Bears Stearn's, AIG, Indy Mac among others.
Thing is, by any sane definition of the word, this is not regulation at all. These people are basically out right saying (and especially the OTS) that if you, Mr. Big Bank, choose them they will do whatever you tell them to do. These people are not really regulators at all - they are industry assets to be deployed to deflect blame and reduce liability when one of their members gets caught or something blows up.
Hence if you say that regulation does not work, my position is 'How do you know? You've never tried it'.
OK that is a little hyperbolic but my point really is that its not necessarily more money that needs to be thrown at the problem - what needs to change is how regulation is done and the entire culture around regulation. I mean this is an event for some of the largest financial institutions in the world and their regulators are pretty much doing tricks for the camera hoping for treats.
The scene itself is part and parcel of a very American phenomena, only in America, one suspects, would regulators be seen taking a chainsaw to the very regulations they are meant to defend and it speaks to the culture of regulation in the US.
Amazing stuff. I can't believe i find myself agreeing with cirno so much. Will attempt to join in later.
Look at insurance companies that regularly drop people from coverage as soon as it comes time to pay.
We cannot trust people whom we do not elect and cannot fire to do what is good just because we really really hope they're going to do what's good.
Thank you for the clarification.
That is a good example for this discussion. The current mess with insurance and health insurance in particular has been created by the government. This doesn't excuse the malfeasance and abuse insurance companies admittedly engage in, but the largely do this with government collusion. The ridiculous situation where people tend to get their health insurance from their employers stems from wage controls during WW2. The tax code incetivizes and perpetuates this absurdity by putting individual consumers at a serious disadvantage. The government regulatory structure protects and perpetuates virtual monopolies removing the vast majority of competitive pressure to lower price and improve services. This doesn't even vaguely resemble a free market so I don't see how it can be rationally argued that this abysmal state is a failure of free markets.
I would add to your point that we also cannot trust the people we elect to do good either, and we would have much more luck firing companies we don't like if there was more competition. There would be more competition if the government didn't enforce virtual monopolies through rigged regulation and massive barriers to entry.
BTW, I'm not an anarcho-capitalist, I think the role of the government involves punishing theft and fraud as part of its core function of protecting individual rights. I think the government does a very poor job of protecting individual rights and basically everything else too.
I think the case for giving the government more and more money and power is a tough position to defend. The size, cost, and invasiveness of government continues to grow and the government doesn't seem to get any less corrupt and incompetent. The areas that the government micromanages are some of the biggest problems in the country. It seems to me that giving a failing government more money and power is just as insane as bailing out Goldman Sachs and making its former CEO the Secretary of the Treasury.
I would like to clarify my position: I do NOT think the regulatory agencies should be given more money or power. I think they should be reduced in size or if possible eliminated altogether. I think they should have a strong oversight system. However, I think that the reduced number of regulators, who would always be watched to ensure that they do their jobs, should be well paid and able to enforce any and all laws pertaining to their regulatory duties.
What would you think of the plan to actually reduce corporate taxes (thus keeping the less taxes = more jobs folks happy. IIRC America already has one of the highest corporate tax rates in the world) while simultaneously raising the capital gains tax back to the pre-Clinton levels? (Also IIRC, most CEO's get paid such obscene amounts mostly due to the fact that are not paid in cash, but in stocks and such.)? Would that be something that you believe would work?
Also, we should make this a new topic. I dont want to derail BT's thread.
I totally agree we should raise capital gains taxes!
Corporate taxes get to stay, though. The US may have the second highest in the world last I checked, but businesses aren't paying them. What needs to happen is tax reform to remove the rediculous loopholes, deductibles, and other tools. Multi-billionaires already pay less then we do. And corporations are much the same.
Of course, that's assuming they pay at all.
Taxes aren't socialism. Taxes aren't bad or evil or something you need "relief" from especially when you're already a multi-billionaire. Taxes are what we owe to ensure civilization.
And hey, if rich people don't want to pay taxes, they're free to "Go Galt," but if history has taught us anything it's that they won't, because for all their bluster they know that's a stupid, stupid decision. In almost every developed country that isn't the US, corporations pay more. And yet, surprisingly enough, they haven't yet "Gone Galt." Corporations also provide more jobs in areas in which they're taxed more, not less. A higher tax rate encourages businesses (who don’t want to pay taxes) to keep the profits in the business and reinvest, rather than pull them out as profits and have to pay high taxes.
Thank you for the clarification.
That is a good example for this discussion. The current mess with insurance and health insurance in particular has been created by the government. This doesn't excuse the malfeasance and abuse insurance companies admittedly engage in, but the largely do this with government collusion. The ridiculous situation where people tend to get their health insurance from their employers stems from wage controls during WW2. The tax code incetivizes and perpetuates this absurdity by putting individual consumers at a serious disadvantage. The government regulatory structure protects and perpetuates virtual monopolies removing the vast majority of competitive pressure to lower price and improve services. This doesn't even vaguely resemble a free market so I don't see how it can be rationally argued that this abysmal state is a failure of free markets.
Government spending is inefficient because they're still trying to use the free market for something the free market is inherently bad at.
Let's use a current day example. Do you know what the two biggest reasons are for Medicare's highest costs? Both of them come to the same root: "The free market."
First, we don't raise sufficient taxes for Medicare. Rather then using a progressive tax system that would ensure equality, we kowtow and allow for people who's net worth is exponentially higher then most others pay the same amount. This is what causes Medicare to be underfunded - we're too busy suckling the rich to ensure they properly pay into programs. We keep thinking the free market will make up for the slack - it's not.
Secondly, we don't allow the government to negotiate. The government currently has no control over what it has to pay for prescription drugs. Here's how it works - the pharmactical corporation says "You have to play this much" and the US government by law has to say "Ok, that's too much, but we'll pay it anyways." It's not just prescription drugs, either. It's all Medicare - the government has been time and time again hamstrung against being able to support itself. Again, we're told the free market will valiantly give us the "right" prices, but what's the right price?
Medicare is dominated and run by Wall Street who, surprise surprise, are in it to make money. That's the purpose of the free market - accumulation of capital. Nothing more. The purpose of the free market is not to ensure fair competition, but to remove it, because that takes away capital. The purpose of the free market is not to ensure everyone can land the best deals, but to ensure there are no good deals, because good deals means for less profit. The purpose of the free market is not to ensure innovation, but to kill it, because innovation is expensive, when me-too copies are cheap and fruitful. Pleading something that is by very definition inhuman and sociopathic is in of itself inhuman and sociopathic. The free market will not cure us of anything, unless what we need cured from is that we have too much money and really just want a few people to have all of it. Surprise surprise, that's precisely what has happened when Reagan began his reforms for supply side economics. That's the entire point - it's why it was called "trickle down" economics. Make the rich richer, and whatever crumbs fall from their table will have to serve for the middle class and poor.
We're starving the beast, alright. But we're starving ourselves at the same time. We started down this road with Reagan’s election in 1980 and upped the ante most recently with George W. Bush. How long does it take to conclude that a policy has failed to fulfill its promises? And as you think of that, keep in mind George Washington. When he fell ill his doctors followed the common wisdom of the era. They cut him and bled him to remove bad blood. As Washington’s condition grew worse, they bled him more. And like the mantra of tax cuts for the rich, they kept applying the same treatment until they killed him.
We're bleeding ourselves to death.
Thank you for your thoughts; I will try to reply with as much thought when I can catch up.
EDIT: Anyone can jump in.
I do believe that the correct way to proceed is somewhere between abolishing the Free Market system and abolishing any fetters to the Free Market.
Cirno: Interesting article that I read in Newsweek about innovation and R&D taking a back seat to profit. Gist of it is that Silicon Valley used to belong to engineers, now its companies like Zynga
Also, after some thinking, I believe the Medicare example is flawed. If , by law, they are not allowed to negotiate for lower prescription prices, that is definately not the free market at work. The free market solution would be to have no law interfere with finding the best deal. Only government intrusion (which writes and enforces the law) keeps Medicare from negotiating. The free market solution would be, "To hell with you over expensive drug manufacturer, I'll find a better deal elsewhere."
-Just my thoughts