One Political Plaza - Home of politics
Home Active Topics Newest Pictures Search Login Register
Main
Why Economist Thomas Piketty Has Scared the Pants Off the American Right
Page 1 of 4 next> last>>
Apr 28, 2014 19:45:11   #
Nickolai
 
Thomas Piketty is no radical. His 700-page book Capital in the 21st Century is certainly not some kind of screed filled with calls for class warfare. In fact, the wonky and mild-mannered French economist opens his tome with a description of his typical Gen X abhorrence of what he calls the “lazy rhetoric of anticapitalism." He is in no way, shape, or form a Marxist. As fellow-economist James K. Galbraith has underscored in his review of the book, Piketty "explicitly (and rather caustically) rejects the Marxist view" of economics.

But he does do something that gives right-wingers in America the willies. He writes calmly and reasonably about economic ine******y, and concludes, to the alarm of conservatives, that there is no magical force that drives capitalist societies toward shared prosperity. Quite the opposite. He warns that if we don't do something about it, we may end up with a society that is more top-heavy than anything that has come before — something even worse than the Gilded Age.

For this, in America, you get branded a crazed C*******t by the right. In this past weekend's New York Times, Ross Douthat sounds the alarm in an op-ed ominously tited "Marx Rises Again." The columnist hints that he and his fellow pundits have only pretended to read the book but nevertheless feel comfortable making statements like "Yes, that’s right: Karl Marx is back from the dead" about Piketty. TheNational Review's James Pethokoukis joins in the games with a silly article called "The New Marxism" in which he repeats the nonsense that Piketty is some sort of Marxist apologist.

For Douthat and his tribe, the proposition that unfettered capitalism marches toward gross ine******y is not a conclusion based on carefully collected data, strenuous research and a sweeping view of history. It has to be a C*******t plot.

The very heft of Piketty's book is terrifying to the Douthats, and no wonder they don't dare to read it, because if they did, they would find chart after chart, data set after data set, and hundreds of years worth of economic history scrutinized.

Income and wealth ine******y have not been comprehensively studied to date, which has to do with the paucity of historical data and the difficulties of making comparisons between countries and populations when there are so many variables. Piketty's contribution is to painstakingly comb over the available data and illuminate trends that would leave no reasonable person in doubt of the fact that capitalism's inherent dynamics create ine******y, and that only our express intervention, in the form of things like a global wealth tax, investment in sk**ls and training, and the diffusion of knowledge can lead us to a different outcome.

To the horror of conservatives, the public is rushing out to buy this weighty economic treatise: the book is #1 on Amazon and has hit the New York Timesbestseller list. A public that not only inuits conservative economic nonsense but has the detailed information to back up that gut instinct is just too awful for words.

Piketty is scaring the right because he is a serious researcher and a calm, disciplined observer who writes in measured tones. But for conservatives who have based the last several decades of economic discussion on mythology, this dose of reality has come at them like a chillling blast of Arctic air.

Let them have their hysteria. It's a testimony to the utter bankruptcy of their ideas.

Memo to liberals and progressives: making Piketty into a rock star isn't helping, either. Let's let the facts speak for themselves.

Reply
Apr 28, 2014 20:04:02   #
missinglink Loc: Tralfamadore
 
The other side by Peter Morici

The new book by French economist Thomas Piketty, "Capital in the Twenty-First Century" has rocketed to the top of the Amazon.com and New York Times best-sellers list. It accomplished this feat by offering yet another apocalyptic vision of capitalism in the tradition of Malthus, Ricardo, and Marx.

To American workers and a middle class besieged by stagnant wages and rising taxes, it provides justification for the dangerous elixir of confiscatory taxes on the wealthy hustled by liberal pundits and politicians.

Piketty’s model of capitalism is tight and compelling because of what it ignores.

Examining an incredible range of data across many countries and several centuries, the author purports to demonstrate that over time capitalist economies naturally concentrate ever greater shares of wealth and income into the hands of a few, leaving less and less resources to pay the wages of ordinary workers.

The theoretical mechanics of his assertions are as arcane as classical physics—and only a Ph.D. economist could reasonably divine their weakness—yet Piketty’s answers to income ine******y are remarkably seductive.

He proposes an 80 percent tax on incomes over $500,000 or $1 million and an annual levy on wealth of as much as 10 percent. In turn, the revenue raised could finance more redistribution programs, championed by progressive politicians seeking v**es, such as state subsidized health care and superfluous government jobs.

Without those taxes, Piketty asserts society will become ever more stratified and hard work will become futile. The best and brightest among those not born to great wealth, like characters in a 19th century novel, will conclude that marrying a fortune is a much better life strategy than seeking gainful employment. All this will k**l economic growth, and make ordinary people poorer and poorer.

Piketty argues the ever greater concentration of wealth continued into the 1920s, when disparities between rich and poor reached a peak. It was only the disruptions of two world wars and the Great Depression that destroyed much of the capital concentrated in the hands of the wealthy and permitted the post-World War II prosperity and rise of the middle class.

Now, Piketty argues, the forces driving ine******y have reemerged. We live in another Great Gatsby-era with Wall Street barons earning in the millions while workers toil at Manhattan restaurants for barely more than the minimum wage.

Piketty’s model of capitalism is tight and compelling because of what it ignores.

The 1920s was a period of exceptional optimism and opportunity in America—if you need your memory jogged, go view a Harold Lloyd movie on Netflix.

Nowadays a good deal of the mega-incomes are not accruing to the heirs of the Rockefeller and Ford fortunes but falling into the hands of middle class offspring who became entrepreneurs or worked hard to become top corporate managers, stars in the media, financiers, and the like.

The founders of Microsoft, Fedex, Facebook and other recently established mega-enterprises were generally not particularly privileged as young adults but rather they had great insight or ideas and the drive to commercialize them.

The huge incomes of top corporate managers, athletes and entertainers may be set by arbitrary forces. For example, the monopolies granted by congress and federal agencies to the cable TV providers permit NFL athletes to receive outsized salaries financed in significant measure by unregulated and ever-rising cable subscription fees. And top corporate leaders do set their own pay by controlling the membership and serving on one another’s boards of directors.

It’s a fool’s errand to try to solve those kinds of problems by simply taxing high incomes and wealth.

Rather, modern economics prescribes that when natural monopolies emerge, such as in the delivery of cable television, it is the responsibility of governments to regulate rates—as they do the electric utilities—to ensure fair incomes to providers and reasonable prices to consumers.And to discipline corporate governance to ensure senior managers do not place their interest above those of shareholders and ordinary workers at large corporations.

The extreme positions for and against measured government intervention embraced by politicians too often block such prudent regulation.

In the end, it’s a failure of democratic governments to act responsibly, not the shortcomings of capitalism that is failing America’s workers and middle class.

Peter Morici is an economist and professor at the Smith School of Business, University of Maryland, and widely published columnist. He is the five time winner of the MarketWatch best forecaster award. Follow him on Twitter @PMorici1.


Nickolai wrote:
Thomas Piketty is no radical. His 700-page book Capital in the 21st Century is certainly not some kind of screed filled with calls for class warfare. In fact, the wonky and mild-mannered French economist opens his tome with a description of his typical Gen X abhorrence of what he calls the “lazy rhetoric of anticapitalism." He is in no way, shape, or form a Marxist. As fellow-economist James K. Galbraith has underscored in his review of the book, Piketty "explicitly (and rather caustically) rejects the Marxist view" of economics.

But he does do something that gives right-wingers in America the willies. He writes calmly and reasonably about economic ine******y, and concludes, to the alarm of conservatives, that there is no magical force that drives capitalist societies toward shared prosperity. Quite the opposite. He warns that if we don't do something about it, we may end up with a society that is more top-heavy than anything that has come before — something even worse than the Gilded Age.

For this, in America, you get branded a crazed C*******t by the right. In this past weekend's New York Times, Ross Douthat sounds the alarm in an op-ed ominously tited "Marx Rises Again." The columnist hints that he and his fellow pundits have only pretended to read the book but nevertheless feel comfortable making statements like "Yes, that’s right: Karl Marx is back from the dead" about Piketty. TheNational Review's James Pethokoukis joins in the games with a silly article called "The New Marxism" in which he repeats the nonsense that Piketty is some sort of Marxist apologist.

For Douthat and his tribe, the proposition that unfettered capitalism marches toward gross ine******y is not a conclusion based on carefully collected data, strenuous research and a sweeping view of history. It has to be a C*******t plot.

The very heft of Piketty's book is terrifying to the Douthats, and no wonder they don't dare to read it, because if they did, they would find chart after chart, data set after data set, and hundreds of years worth of economic history scrutinized.

Income and wealth ine******y have not been comprehensively studied to date, which has to do with the paucity of historical data and the difficulties of making comparisons between countries and populations when there are so many variables. Piketty's contribution is to painstakingly comb over the available data and illuminate trends that would leave no reasonable person in doubt of the fact that capitalism's inherent dynamics create ine******y, and that only our express intervention, in the form of things like a global wealth tax, investment in sk**ls and training, and the diffusion of knowledge can lead us to a different outcome.

To the horror of conservatives, the public is rushing out to buy this weighty economic treatise: the book is #1 on Amazon and has hit the New York Timesbestseller list. A public that not only inuits conservative economic nonsense but has the detailed information to back up that gut instinct is just too awful for words.

Piketty is scaring the right because he is a serious researcher and a calm, disciplined observer who writes in measured tones. But for conservatives who have based the last several decades of economic discussion on mythology, this dose of reality has come at them like a chillling blast of Arctic air.

Let them have their hysteria. It's a testimony to the utter bankruptcy of their ideas.

Memo to liberals and progressives: making Piketty into a rock star isn't helping, either. Let's let the facts speak for themselves.
Thomas Piketty is no radical. His 700-page book Ca... (show quote)

Reply
Apr 28, 2014 20:17:45   #
J Anthony Loc: Connecticut
 
Nickolai wrote:
Thomas Piketty is no radical. His 700-page book Capital in the 21st Century is certainly not some kind of screed filled with calls for class warfare. In fact, the wonky and mild-mannered French economist opens his tome with a description of his typical Gen X abhorrence of what he calls the “lazy rhetoric of anticapitalism." He is in no way, shape, or form a Marxist. As fellow-economist James K. Galbraith has underscored in his review of the book, Piketty "explicitly (and rather caustically) rejects the Marxist view" of economics.

But he does do something that gives right-wingers in America the willies. He writes calmly and reasonably about economic ine******y, and concludes, to the alarm of conservatives, that there is no magical force that drives capitalist societies toward shared prosperity. Quite the opposite. He warns that if we don't do something about it, we may end up with a society that is more top-heavy than anything that has come before — something even worse than the Gilded Age.

For this, in America, you get branded a crazed C*******t by the right. In this past weekend's New York Times, Ross Douthat sounds the alarm in an op-ed ominously tited "Marx Rises Again." The columnist hints that he and his fellow pundits have only pretended to read the book but nevertheless feel comfortable making statements like "Yes, that’s right: Karl Marx is back from the dead" about Piketty. TheNational Review's James Pethokoukis joins in the games with a silly article called "The New Marxism" in which he repeats the nonsense that Piketty is some sort of Marxist apologist.

For Douthat and his tribe, the proposition that unfettered capitalism marches toward gross ine******y is not a conclusion based on carefully collected data, strenuous research and a sweeping view of history. It has to be a C*******t plot.

The very heft of Piketty's book is terrifying to the Douthats, and no wonder they don't dare to read it, because if they did, they would find chart after chart, data set after data set, and hundreds of years worth of economic history scrutinized.

Income and wealth ine******y have not been comprehensively studied to date, which has to do with the paucity of historical data and the difficulties of making comparisons between countries and populations when there are so many variables. Piketty's contribution is to painstakingly comb over the available data and illuminate trends that would leave no reasonable person in doubt of the fact that capitalism's inherent dynamics create ine******y, and that only our express intervention, in the form of things like a global wealth tax, investment in sk**ls and training, and the diffusion of knowledge can lead us to a different outcome.

To the horror of conservatives, the public is rushing out to buy this weighty economic treatise: the book is #1 on Amazon and has hit the New York Timesbestseller list. A public that not only inuits conservative economic nonsense but has the detailed information to back up that gut instinct is just too awful for words.

Piketty is scaring the right because he is a serious researcher and a calm, disciplined observer who writes in measured tones. But for conservatives who have based the last several decades of economic discussion on mythology, this dose of reality has come at them like a chillling blast of Arctic air.

Let them have their hysteria. It's a testimony to the utter bankruptcy of their ideas.

Memo to liberals and progressives: making Piketty into a rock star isn't helping, either. Let's let the facts speak for themselves.
Thomas Piketty is no radical. His 700-page book Ca... (show quote)


Good post, and you are right. This issue goes beyond politics and should be something that concerns everyone. Piketty's political leanings are irrelevant. Those who benefit the most from the institutionalized usury that is our banking and monetary-system will fight most vehemently against any attempts to change things or educate the public about what's actually going on. With our technology and production capabilities, there is no more reason to function under an archaic, outdated system that is designed to assure extreme ine******y. It is not a lack of funding or resources that keep us from solving these problems, it is a lack of will and imagination. Nothing will ever be perfect, but to believe this is the best way we can conceive of to run society and thrive as a civilization is small-minded at best.

Reply
 
 
Apr 28, 2014 20:41:35   #
Nickolai
 
J Anthony wrote:
Good post, and you are right. This issue goes beyond politics and should be something that concerns everyone. Piketty's political leanings are irrelevant. Those who benefit the most from the institutionalized usury that is our banking and monetary-system will fight most vehemently against any attempts to change things or educate the public about what's actually going on. With our technology and production capabilities, there is no more reason to function under an archaic, outdated system that is designed to assure extreme ine******y. It is not a lack of funding or resources that keep us from solving these problems, it is a lack of will and imagination. Nothing will ever be perfect, but to believe this is the best way we can conceive of to run society and thrive as a civilization is small-minded at best.
Good post, and you are right. This issue goes beyo... (show quote)




That capitalism is unfair has been said before. But it is the way Thomas Piketty says it – subtly but with relentless logic – that has sent rightwing economics into a frenzy, both here and in the US.

Piketty's argument is that, in an economy where the rate of return on capital outstrips the rate of growth, inherited wealth will always grow faster than earned wealth. So the fact that rich kids can swan aimlessly from gap year to internship to a job at father's bank/ministry/TV network – while the poor kids sweat into their barista uniforms – is not an accident: it is the system working normally.

Many of the book's 700 pages are spent marshalling the evidence that 21st-century capitalism is on a one-way journey towards ine******y – unless we do something.

Put crudely, if growth is high and the returns on capital can be suppressed, you can have a more equal capitalism. But, says Piketty, a repeat of the Keynesian era is unlikely: labour is too weak, technological innovation too slow, the global power of capital too great. In addition, the legitimacy of this unequal system is high: because it has found ways to spread the wealth down to the managerial class in a way the early 19th century did not.

If he is right, the implications for capitalism are utterly negative: we face a low-growth capitalism, combined with high levels of ine******y and low levels of social mobility. If you are not born into wealth to start with, life, for even for the best educated, will be like Jane Eyre without Mr Rochester

Reply
Apr 28, 2014 20:53:42   #
alabuck Loc: Tennessee
 
I can see both sides of this argument. But, I lean toward a government that regulates business. I say this because, as has been historically proven time and again, those with the most money, don't like to give it up. That, and mankind's basic propensity for greed, oftentimes cause the more powerful to oppress the less powerful.

This is seen in the examples of the "big box stores" driving the "mom and pop" stores out of business. And, the large grocery chains causing the local markets to close. Also, in the pay levels between those who control/run the corporations and the pay of the average workers in those plants. To say there's a consecration of wealth and political/economic power should go without saying.

Unless the government supports only the richer citizens, it's its duty to see that each and every citizen has available to him/her, the valid opportunity to get a job and earn an income sufficient to provide a comfortable living for his/her family. By failing to provide this, the government is only perpetuating economic/class divisions; very similar to the direction the US is currently headed.

It should be very obvious to all that we are returning to the "Gilded Age." The age if the "robber barons." The age of child labor. The age of no work-place safety. The age of no government oversight of the food we eat, the drugs we take, the safety of the products we use. For those who want government out of their lives, perhaps, they should read Upton Sinclair & John Updike. Even read about how Henry Ford hired thugs to literally crack the skulls of workers who wanted a union to represent them for better wages and working conditions.

While this may sound to some like I'm advocating socialism &/or c*******m, I can assure you, that's not true. I want to see a return to the values that made the USA great. I want to see the American worker be proud of his/her job. I want to see a return to sensible salaries for the CEO's and CFO's. I want to see a worker's pension not be a pawn in a corporate take-over, forever lost to the people who invested into it, while the new owners count the pension fund as a liquidated earning, eligible for confiscation by the new owners and t***sferred to the checking accounts of the CEO, CFO and the COO. I want a return to the kind of economic morality that made our middle class the biggest and strongest in the world. I want us to find something we've lost.

Reply
Apr 28, 2014 21:00:46   #
vernon
 
Nickolai wrote:
Thomas Piketty is no radical. His 700-page book Capital in the 21st Century is certainly not some kind of screed filled with calls for class warfare. In fact, the wonky and mild-mannered French economist opens his tome with a description of his typical Gen X abhorrence of what he calls the “lazy rhetoric of anticapitalism." He is in no way, shape, or form a Marxist. As fellow-economist James K. Galbraith has underscored in his review of the book, Piketty "explicitly (and rather caustically) rejects the Marxist view" of economics.

But he does do something that gives right-wingers in America the willies. He writes calmly and reasonably about economic ine******y, and concludes, to the alarm of conservatives, that there is no magical force that drives capitalist societies toward shared prosperity. Quite the opposite. He warns that if we don't do something about it, we may end up with a society that is more top-heavy than anything that has come before — something even worse than the Gilded Age.

For this, in America, you get branded a crazed C*******t by the right. In this past weekend's New York Times, Ross Douthat sounds the alarm in an op-ed ominously tited "Marx Rises Again." The columnist hints that he and his fellow pundits have only pretended to read the book but nevertheless feel comfortable making statements like "Yes, that’s right: Karl Marx is back from the dead" about Piketty. TheNational Review's James Pethokoukis joins in the games with a silly article called "The New Marxism" in which he repeats the nonsense that Piketty is some sort of Marxist apologist.

For Douthat and his tribe, the proposition that unfettered capitalism marches toward gross ine******y is not a conclusion based on carefully collected data, strenuous research and a sweeping view of history. It has to be a C*******t plot.

The very heft of Piketty's book is terrifying to the Douthats, and no wonder they don't dare to read it, because if they did, they would find chart after chart, data set after data set, and hundreds of years worth of economic history scrutinized.

Income and wealth ine******y have not been comprehensively studied to date, which has to do with the paucity of historical data and the difficulties of making comparisons between countries and populations when there are so many variables. Piketty's contribution is to painstakingly comb over the available data and illuminate trends that would leave no reasonable person in doubt of the fact that capitalism's inherent dynamics create ine******y, and that only our express intervention, in the form of things like a global wealth tax, investment in sk**ls and training, and the diffusion of knowledge can lead us to a different outcome.

To the horror of conservatives, the public is rushing out to buy this weighty economic treatise: the book is #1 on Amazon and has hit the New York Timesbestseller list. A public that not only inuits conservative economic nonsense but has the detailed information to back up that gut instinct is just too awful for words.

Piketty is scaring the right because he is a serious researcher and a calm, disciplined observer who writes in measured tones. But for conservatives who have based the last several decades of economic discussion on mythology, this dose of reality has come at them like a chillling blast of Arctic air.

Let them have their hysteria. It's a testimony to the utter bankruptcy of their ideas.

Memo to liberals and progressives: making Piketty into a rock star isn't helping, either. Let's let the facts speak for themselves.
Thomas Piketty is no radical. His 700-page book Ca... (show quote)



in my opinion the problem is with govt putting people on the dole .it doesnt take long for someone to get accustomed to sitting on their butt and it is all govt fault.

Reply
Apr 28, 2014 21:03:18   #
missinglink Loc: Tralfamadore
 
Like your post. Your thoughts strike a cord.

alabuck wrote:
I can see both sides of this argument. But, I lean toward a government that regulates business. I say this because, as has been historically proven time and again, those with the most money, don't like to give it up. That, and mankind's basic propensity for greed, oftentimes cause the more powerful to oppress the less powerful.

This is seen in the examples of the "big box stores" driving the "mom and pop" stores out of business. And, the large grocery chains causing the local markets to close. Also, in the pay levels between those who control/run the corporations and the pay of the average workers in those plants. To say there's a consecration of wealth and political/economic power should go without saying.

Unless the government supports only the richer citizens, it's its duty to see that each and every citizen has available to him/her, the valid opportunity to get a job and earn an income sufficient to provide a comfortable living for his/her family. By failing to provide this, the government is only perpetuating economic/class divisions; very similar to the direction the US is currently headed.

It should be very obvious to all that we are returning to the "Gilded Age." The age if the "robber barons." The age of child labor. The age of no work-place safety. The age of no government oversight of the food we eat, the drugs we take, the safety of the products we use. For those who want government out of their lives, perhaps, they should read Upton Sinclair & John Updike. Even read about how Henry Ford hired thugs to literally crack the skulls of workers who wanted a union to represent them for better wages and working conditions.

While this may sound to some like I'm advocating socialism &/or c*******m, I can assure you, that's not true. I want to see a return to the values that made the USA great. I want to see the American worker be proud of his/her job. I want to see a return to sensible salaries for the CEO's and CFO's. I want to see a worker's pension not be a pawn in a corporate take-over, forever lost to the people who invested into it, while the new owners count the pension fund as a liquidated earning, eligible for confiscation by the new owners and t***sferred to the checking accounts of the CEO, CFO and the COO. I want a return to the kind of economic morality that made our middle class the biggest and strongest in the world. I want us to find something we've lost.
I can see both sides of this argument. But, I lea... (show quote)

Reply
 
 
Apr 28, 2014 22:11:22   #
rickdri
 
Nickolai wrote:
Thomas Piketty is no radical. His 700-page book Capital in the 21st Century is certainly not some kind of screed filled with calls for class warfare. In fact, the wonky and mild-mannered French economist opens his tome with a description of his typical Gen X abhorrence of what he calls the “lazy rhetoric of anticapitalism." He is in no way, shape, or form a Marxist. As fellow-economist James K. Galbraith has underscored in his review of the book, Piketty "explicitly (and rather caustically) rejects the Marxist view" of economics.

But he does do something that gives right-wingers in America the willies. He writes calmly and reasonably about economic ine******y, and concludes, to the alarm of conservatives, that there is no magical force that drives capitalist societies toward shared prosperity. Quite the opposite. He warns that if we don't do something about it, we may end up with a society that is more top-heavy than anything that has come before — something even worse than the Gilded Age.

For this, in America, you get branded a crazed C*******t by the right. In this past weekend's New York Times, Ross Douthat sounds the alarm in an op-ed ominously tited "Marx Rises Again." The columnist hints that he and his fellow pundits have only pretended to read the book but nevertheless feel comfortable making statements like "Yes, that’s right: Karl Marx is back from the dead" about Piketty. TheNational Review's James Pethokoukis joins in the games with a silly article called "The New Marxism" in which he repeats the nonsense that Piketty is some sort of Marxist apologist.

For Douthat and his tribe, the proposition that unfettered capitalism marches toward gross ine******y is not a conclusion based on carefully collected data, strenuous research and a sweeping view of history. It has to be a C*******t plot.

The very heft of Piketty's book is terrifying to the Douthats, and no wonder they don't dare to read it, because if they did, they would find chart after chart, data set after data set, and hundreds of years worth of economic history scrutinized.

Income and wealth ine******y have not been comprehensively studied to date, which has to do with the paucity of historical data and the difficulties of making comparisons between countries and populations when there are so many variables. Piketty's contribution is to painstakingly comb over the available data and illuminate trends that would leave no reasonable person in doubt of the fact that capitalism's inherent dynamics create ine******y, and that only our express intervention, in the form of things like a global wealth tax, investment in sk**ls and training, and the diffusion of knowledge can lead us to a different outcome.

To the horror of conservatives, the public is rushing out to buy this weighty economic treatise: the book is #1 on Amazon and has hit the New York Timesbestseller list. A public that not only inuits conservative economic nonsense but has the detailed information to back up that gut instinct is just too awful for words.

Piketty is scaring the right because he is a serious researcher and a calm, disciplined observer who writes in measured tones. But for conservatives who have based the last several decades of economic discussion on mythology, this dose of reality has come at them like a chillling blast of Arctic air.

Let them have their hysteria. It's a testimony to the utter bankruptcy of their ideas.

Memo to liberals and progressives: making Piketty into a rock star isn't helping, either. Let's let the facts speak for themselves.
Thomas Piketty is no radical. His 700-page book Ca... (show quote)


Does Piketty understand the difference between real capitalism and crony capitalism? Real capitalism raises everyone's boat. Crony capitalism raises only those of the elite at the expense of the less fortunate. Let's compare the past 33 years. From 1981 to 2001. Presidents Reagan, Bush, and Clinton were business friendly. The economy grew at an average GDP of 3.8%. 2001 to 2014 Presidents Bush and Obama,with an emphasis on Obama, were not as business friendly. Although Bush was much more business friendly than Obama, he was perhaps a little to friendly. The economy has grown at an average GDP of 1.8%. See the difference between real and crony capitalism. Does Piketty know the true difference?

Reply
Apr 28, 2014 22:59:28   #
Nickolai
 
alabuck wrote:
I can see both sides of this argument. But, I lean toward a government that regulates business. I say this because, as has been historically proven time and again, those with the most money, don't like to give it up. That, and mankind's basic propensity for greed, oftentimes cause the more powerful to oppress the less powerful.

This is seen in the examples of the "big box stores" driving the "mom and pop" stores out of business. And, the large grocery chains causing the local markets to close. Also, in the pay levels between those who control/run the corporations and the pay of the average workers in those plants. To say there's a consecration of wealth and political/economic power should go without saying.

Unless the government supports only the richer citizens, it's its duty to see that each and every citizen has available to him/her, the valid opportunity to get a job and earn an income sufficient to provide a comfortable living for his/her family. By failing to provide this, the government is only perpetuating economic/class divisions; very similar to the direction the US is currently headed.

It should be very obvious to all that we are returning to the "Gilded Age." The age if the "robber barons." The age of child labor. The age of no work-place safety. The age of no government oversight of the food we eat, the drugs we take, the safety of the products we use. For those who want government out of their lives, perhaps, they should read Upton Sinclair & John Updike. Even read about how Henry Ford hired thugs to literally crack the skulls of workers who wanted a union to represent them for better wages and working conditions.

While this may sound to some like I'm advocating socialism &/or c*******m, I can assure you, that's not true. I want to see a return to the values that made the USA great. I want to see the American worker be proud of his/her job. I want to see a return to sensible salaries for the CEO's and CFO's. I want to see a worker's pension not be a pawn in a corporate take-over, forever lost to the people who invested into it, while the new owners count the pension fund as a liquidated earning, eligible for confiscation by the new owners and t***sferred to the checking accounts of the CEO, CFO and the COO. I want a return to the kind of economic morality that made our middle class the biggest and strongest in the world. I want us to find something we've lost.
I can see both sides of this argument. But, I lea... (show quote)


You make some good points, rather great points. In 2009 John Paulson a hedge fund Mgr. Conspired with Goldman Sachs to create a mortgage backed Security loaded with liar loan mortgages guaranteed to fail. Goldman sold these CDO's to investors as being as safe as federal treasuries ( government bonds ) Goldman paid the rating agency's to rate these decortications high. Then both Goldman and Paulson took short positions . Credit default swaps from AIG the big insurer. Goldman made fees from selling the securities and another 13 billion from the swaps. Paulson in 2009 pocketed five billion dollars profit all in Cap Gains taxed at 15 %. If as Thomas Picketty insists, top incomes such as Paulson's be taxed at 80 % poor old Paulson would have to of had to scrape by on a paltry one billion dollar income.

At the end of Eisenhower's administration top bracket was 91 % the American middle class was growing in leaps and bounds and the rich were still getting richer even as lower incomes kept pace. The problem with government regulating business is over time the power of money finds way's around and over the reg's. The guilded age spawaned the progressive era of reform and regulations but proved to be insuficent. Then the excesses of the 1920's resulted in a deep depression and far more effective regulations were enacted which led to the rise of the greatest middle class the world had ever seen even as the top tax bracket remained above 70 %.

But the wealthy chaffing under the regulatiions and high tax on the top brackets began to unwind the Regulations and the new deal in the 1970's starting with trucking, railroads, airlines, and banking. Usering an era of vulture capitalism, mergers, accuisitions, Corporate raiding, and hostile take overs. Government regulating buisness alone, looking at history in the long run dosen't work when regulaters are paid to not regulate. And politicians are bought and paid to favor the powerfull. Regulate too much and you stiffel innovation. Regulate too little and and wealth contrates into too few hands. What's really needed is a new model.

Reply
Apr 29, 2014 01:47:33   #
rickdri
 
alabuck wrote:
I can see both sides of this argument. But, I lean toward a government that regulates business. I say this because, as has been historically proven time and again, those with the most money, don't like to give it up. That, and mankind's basic propensity for greed, oftentimes cause the more powerful to oppress the less powerful.

This is seen in the examples of the "big box stores" driving the "mom and pop" stores out of business. And, the large grocery chains causing the local markets to close. Also, in the pay levels between those who control/run the corporations and the pay of the average workers in those plants. To say there's a consecration of wealth and political/economic power should go without saying.

Unless the government supports only the richer citizens, it's its duty to see that each and every citizen has available to him/her, the valid opportunity to get a job and earn an income sufficient to provide a comfortable living for his/her family. By failing to provide this, the government is only perpetuating economic/class divisions; very similar to the direction the US is currently headed.

It should be very obvious to all that we are returning to the "Gilded Age." The age if the "robber barons." The age of child labor. The age of no work-place safety. The age of no government oversight of the food we eat, the drugs we take, the safety of the products we use. For those who want government out of their lives, perhaps, they should read Upton Sinclair & John Updike. Even read about how Henry Ford hired thugs to literally crack the skulls of workers who wanted a union to represent them for better wages and working conditions.

While this may sound to some like I'm advocating socialism &/or c*******m, I can assure you, that's not true. I want to see a return to the values that made the USA great. I want to see the American worker be proud of his/her job. I want to see a return to sensible salaries for the CEO's and CFO's. I want to see a worker's pension not be a pawn in a corporate take-over, forever lost to the people who invested into it, while the new owners count the pension fund as a liquidated earning, eligible for confiscation by the new owners and t***sferred to the checking accounts of the CEO, CFO and the COO. I want a return to the kind of economic morality that made our middle class the biggest and strongest in the world. I want us to find something we've lost.
I can see both sides of this argument. But, I lea... (show quote)


Our government has become one of the most corrupt institutions in the world. Money buys the rich elite everything they want from our politicians. These politicians control the purse strings and the law making ability in our country. The rich 1% control these politicians with huge donations and under the table gifts to the politicians. Laws are passed not by what good they will do for the American people, but by how much money a lobbyist has given to the politicians. Why do you think corporations donate money to our so called representatives? Obama said there would be no lobbyists in his administration, yet there are a number of lobbyist helping to make law in Washington. They are not helping to make laws to help the American people.
Look at Obama's signature legacy law the ACA. How do you think had the most to gain by its passing? Big Pharma and Big Insurance companies. Laws are supposed to be passed that are understood by congress and that will help the American people. This law was not even read! Remember Nancy Pelosi saying " you have to pass the law to see what's in it away from the fog of controversy." What stupidity! No one knew what was in it now millions of Americans have been hurt by this law and millions more will be hurt as soon as the employer mandate comes into effect. Why do you think Obama keeps illegally pushing the laws full implementation back further into the future? He knows how many people that will be hurt from this law. He also knows that Big Pharma and Big Insurance companies are making big money off of these laws.
We have a huge corrupt government making laws not for the benefit of the country, but only for the benefit of big business. This is crony capitalism, not true capitalism. I asked whether Piketty knows the difference between crony and true capitalism and received no answer from the original poster. Piketty's book does not scare me. He only shows that he doesn't understand true capitalism. Much like many of our current so called leaders in Washington!

Reply
Apr 29, 2014 01:55:52   #
rickdri
 
missinglink wrote:
The other side by Peter Morici

The new book by French economist Thomas Piketty, "Capital in the Twenty-First Century" has rocketed to the top of the Amazon.com and New York Times best-sellers list. It accomplished this feat by offering yet another apocalyptic vision of capitalism in the tradition of Malthus, Ricardo, and Marx.

To American workers and a middle class besieged by stagnant wages and rising taxes, it provides justification for the dangerous elixir of confiscatory taxes on the wealthy hustled by liberal pundits and politicians.

Piketty’s model of capitalism is tight and compelling because of what it ignores.

Examining an incredible range of data across many countries and several centuries, the author purports to demonstrate that over time capitalist economies naturally concentrate ever greater shares of wealth and income into the hands of a few, leaving less and less resources to pay the wages of ordinary workers.

The theoretical mechanics of his assertions are as arcane as classical physics—and only a Ph.D. economist could reasonably divine their weakness—yet Piketty’s answers to income ine******y are remarkably seductive.

He proposes an 80 percent tax on incomes over $500,000 or $1 million and an annual levy on wealth of as much as 10 percent. In turn, the revenue raised could finance more redistribution programs, championed by progressive politicians seeking v**es, such as state subsidized health care and superfluous government jobs.

Without those taxes, Piketty asserts society will become ever more stratified and hard work will become futile. The best and brightest among those not born to great wealth, like characters in a 19th century novel, will conclude that marrying a fortune is a much better life strategy than seeking gainful employment. All this will k**l economic growth, and make ordinary people poorer and poorer.

Piketty argues the ever greater concentration of wealth continued into the 1920s, when disparities between rich and poor reached a peak. It was only the disruptions of two world wars and the Great Depression that destroyed much of the capital concentrated in the hands of the wealthy and permitted the post-World War II prosperity and rise of the middle class.

Now, Piketty argues, the forces driving ine******y have reemerged. We live in another Great Gatsby-era with Wall Street barons earning in the millions while workers toil at Manhattan restaurants for barely more than the minimum wage.

Piketty’s model of capitalism is tight and compelling because of what it ignores.

The 1920s was a period of exceptional optimism and opportunity in America—if you need your memory jogged, go view a Harold Lloyd movie on Netflix.

Nowadays a good deal of the mega-incomes are not accruing to the heirs of the Rockefeller and Ford fortunes but falling into the hands of middle class offspring who became entrepreneurs or worked hard to become top corporate managers, stars in the media, financiers, and the like.

The founders of Microsoft, Fedex, Facebook and other recently established mega-enterprises were generally not particularly privileged as young adults but rather they had great insight or ideas and the drive to commercialize them.

The huge incomes of top corporate managers, athletes and entertainers may be set by arbitrary forces. For example, the monopolies granted by congress and federal agencies to the cable TV providers permit NFL athletes to receive outsized salaries financed in significant measure by unregulated and ever-rising cable subscription fees. And top corporate leaders do set their own pay by controlling the membership and serving on one another’s boards of directors.

It’s a fool’s errand to try to solve those kinds of problems by simply taxing high incomes and wealth.

Rather, modern economics prescribes that when natural monopolies emerge, such as in the delivery of cable television, it is the responsibility of governments to regulate rates—as they do the electric utilities—to ensure fair incomes to providers and reasonable prices to consumers.And to discipline corporate governance to ensure senior managers do not place their interest above those of shareholders and ordinary workers at large corporations.

The extreme positions for and against measured government intervention embraced by politicians too often block such prudent regulation.

In the end, it’s a failure of democratic governments to act responsibly, not the shortcomings of capitalism that is failing America’s workers and middle class.

Peter Morici is an economist and professor at the Smith School of Business, University of Maryland, and widely published columnist. He is the five time winner of the MarketWatch best forecaster award. Follow him on Twitter @PMorici1.
The other side by Peter Morici br br The new boo... (show quote)



Thank you missing link for providing some common sense! There is one more thing that is ignored by Piketty. The difference between crony capitalism and real capitalism. I have asked Nikolai if Piketty knew the difference and have not received a response yet! There is a significant difference between the two that seems to have not been taken into account!

Reply
 
 
Apr 29, 2014 06:38:20   #
J Anthony Loc: Connecticut
 
rickdri wrote:
Does Piketty understand the difference between real capitalism and crony capitalism? Real capitalism raises everyone's boat. Crony capitalism raises only those of the elite at the expense of the less fortunate. Let's compare the past 33 years. From 1981 to 2001. Presidents Reagan, Bush, and Clinton were business friendly. The economy grew at an average GDP of 3.8%. 2001 to 2014 Presidents Bush and Obama,with an emphasis on Obama, were not as business friendly. Although Bush was much more business friendly than Obama, he was perhaps a little to friendly. The economy has grown at an average GDP of 1.8%. See the difference between real and crony capitalism. Does Piketty know the true difference?
Does Piketty understand the difference between rea... (show quote)


"True capitalism?" That is what exactly? When no one is corrupt or dishonest? And I don't get where Obama is any less business friendly than his predecessors, the disparities have increased under his watch. He's maintaining the status quo the same as the others.

Reply
Apr 29, 2014 06:50:49   #
J Anthony Loc: Connecticut
 
J Anthony wrote:
"True capitalism?" That is what exactly? When no one is corrupt or dishonest? And I don't get where Obama is any less business friendly than his predecessors, the disparities have increased under his watch. He's maintaining the status quo the same as the others.


Plus, how to implement "true capitalism" ? Obviously we can't legislate morality.

Reply
Apr 29, 2014 07:50:41   #
Patty
 
Does anyone really think that the people will sit back and tolerate this?
http://fdic.gov/about/srac/2012/gsifi.pdf
http://www.zerohedge.com/news/2013-12-12/imf-wants-you-pay-71-income-tax

Reply
Apr 29, 2014 08:41:34   #
rickdri
 
J Anthony wrote:
"True capitalism?" That is what exactly? When no one is corrupt or dishonest? And I don't get where Obama is any less business friendly than his predecessors, the disparities have increased under his watch. He's maintaining the status quo the same as the others.


True capitalism is what was practiced under Reagan, Bush, and Clinton. Government didn't pick the winners and the losers and let business decide who won and who lost. The losers would go out of business while the winners thrived. While there was a savings and loan crisis and bailout it paled in comparison to what Bush 43 and Obama have done. TARP, All of the business bail outs, QE1, 2, 3, QE infinity. What has all of this gotten us? A short audit of the Federal Reserve found that they had loaned out $16 trillion to foreign banks. What are we getting for that? We will never see all of that money again. Is there corruption in true capitalism of course. The corruption is held to a minimum by government agencies doing their jobs. Not like today when we see the SEC watching porn 8 hours a day. Today government officials are being bought off at a record pace. Honor is not present among most government officials including congress and the president.
Another aspect of true capitalism is a president that does not waste billions upon billions of tax payer dollars on countless failed g***n e****y projects. The tax payers have suffered enormously while all of Obama's buddies, his campaign bundlers and friends, did not lose a dime. Why doesn't that make you mad? Sure past presidents have helped businesses with loans. However the taxpayers did not lose their money and we got results.
Obama continues to hold up the Keystone pipeline, why? Countless studies have been done and have proven there will be no environmental damage. Many jobs will be created. The number depends upon who you talk to. Labor Unions, one of Obama's biggest supporters, are all for it. They are ready to get started. Why does he continue to hold this up? As for his signature legacy law, while it has helped Big Pharma, and Insurance companies, it has hurt countless small businesses, and has reduced employment for many folks to less than 30 hours per week. It has stopped small businesses from hiring that 51st worker. It has hurt millions of policy holders costing them up to 3 times what they previously paid and they now have to carry coverage they will never need. Why is government forcing people to buy extra coverage they will never need? Yes Obama has governed in an anti business way. Picking losing industries to fund, picking big business winners while hurting the small businesses and American people, Continuing to delay business projects like Keystone for no acceptable reason. There are more that I can give but that could be for another time.

Reply
Page 1 of 4 next> last>>
If you want to reply, then register here. Registration is free and your account is created instantly, so you can post right away.
Main
OnePoliticalPlaza.com - Forum
Copyright 2012-2024 IDF International Technologies, Inc.