Capitalism Guarantees Rising Inequality

[Andylusion]

This is what losers say to excuse themselves from being losers. When you read the histories of rich people, they got rich by working hard, working smart.

Luck? Sure, everyone has a measure of luck. But most of that luck, comes from a long history of hard work.

Alex Spanos, became a multimillionaire, after he ran into a guy who needed living accommodations, and then a guy in his town happen to have live space available, and offered it to Alex Spanos without any deposit.

Was that "luck"? Somewhat, but it was also because both people knew Alex, and knew he'd worked his butt off for 10 years, at minimum wage in a bakery, and knew he was a good worker, and knew he was honest and trust worthy.

Spanos built a reputation for himself with honesty, credibility, and hard work for over a decade making minimum wage.

See stupid losers, they don't work hard, don't have credibility, are not trust worthy, and then they spend barely a year working a minimum wage job, late coming to work, leave early, and do as little as possible while they are there.... and then want to b!tch and moan that rich people are lucky.

No, you are a lousy worker, and that's why you are paid nothing, and have no 'luck'.

 

[Bombur]

Round and round we go...

No, other countries don't matter, unless you can specifically point to empirical data that suggest they do. It's ironic that you claim I'm just throwing out stuff, and yet you are throwing out "other countries" with absolutely nothing to support that their problems were in any way, related to ours.

Pointing out that Freddie Mac Securitized Sub-prime loans in 1997, is not just a random irrelevant factoid. It represents the reversal of 50 years worth of standards on what qualified to be a secure loan to the investor market. Pointing out that this act happen at the very exact moment that the sub-prime market shoots off, represents a reversal of at least 20 years of sub-prime being a niche market. Pointing out that the price bubble started, at the very moment these two events happened, is not irrelevant, or inconsequential. It is the logical steps of action verse reaction.

My opinion is based on the empirical data, that is widely known, and accepted. Saying "other countries has something similar happen in a similar time span" is both vague and correlative, not causative.

Further it seems like you have an extreme double standard. When talking about borrowers, you give them a complete and total free-pass for taking loans they had absolutely no ability to repay, and buying homes they had no ability to afford. You do not require them to have any responsibility in the loans they got, and signed their names too.

Yet with the loan originators, you claim they should have complete responsibility to knowing the ability of the borrower to pay back.

Now that right there, is in itself illogical. You expect that the person taking the loan, should have less self-knowledge of their own ability to repay, than some accountant in a cubicle somewhere? What logic is that?

Yet the government told both the borrower, and the lender, that these loans were safe, by virtue of the fact gov had their arms, Freddie and Fannie, securitize those loans.

Why is it that when the banker is told to make these loans, and that they are safe because Fannie Freddie securitized them, or they'll get sued by the government, they are supposed to know better somehow.... yet when a borrower who has bad credit, low income, no down payment walks into a bank and asks for a loan, they are absolved from knowing better, and taking responsibility for taking a loan they can't afford?



Completely wrong.... I'm sorry, we're not going past this point either, until you admit the truth.
(GSA- Glass Steagall Act)

Washington Mutual. Savings and Loans. Did not fall under GSA.
IndyMac. Savings and Loans. Did not fall under the GSA.
Bear Stearns. Investment bank. Did not fall under the GSA.
CountryWide. Investment bank. Did not fall under the GSA.
Merrill Lynch. Investment bank. Did not fall under the GSA.
AIG. Insurance company. Did not fall under the GSA.

In fact, if you just walk down the list of all the failures, very very few were Financial Holding Companies. If you don't know... the Gramm–Leach–Bliley Act, did not just "allow banks to do whatever they want" or something.

Gramm–Leach–Bliley Act, allowed banks to apply to change their charter to a "Financial Holding Company". By doing this, they could then operate Retail Banking (your local bank, open a savings account and such), Commercial Banking (loans and accounts of corporations and business), Investment Banking (buying securities like MBS and such), and Insurance Services.

But the key is, they had to change over their charter. Most didn't.

Thus the vast majority of all the banks that failed during the crash, were not Financial Holding Companies, and if GLB Act had never existed, nothing would have changed with the vast majority of those failures.

The only big exception that I know of, would be Wachovia.

But other companies that WERE Financial Holding Companies, many of them weathered the storm better. Wells Fargo was a FHC. They did fine. JPMorgan Chase, was a FHC, and they had no problems.

In fact, over all, Financial Holding Companies did better than their more limited competitors, naturally because of diversification. If you have your entire business wrapped up exclusively in Mortgages, and the Mortgage market tanks, you are likely to go down. If on the other hand, you have some insurance business, and some retail business, and investment business, and a fraction of your business is in Mortgages, and they tank, you or more likely to survive.

Further!!

The government actually used Financial Holding Companies, as their method for FIXING the crisis.

Hello?!?

Bank of America was not a FHC. But the government asked them to buy out CountryWide..... which required them to become an FHC.
JP Morgan Chase, was asked to purchase Bear Stearns and Washington Mutual.... which they would not have been able to do without being an FHC.
Wells Fargo was asked to buy Wachovia, and Century Bank.... which they would not have been able to do without being an FHC.

What part of this is not making sense?

Bottom line..... Glass Steagall, and the Gramm Leach Bliley, neither one had ANYTHING.... to do with the crash. Nothing. Period. Sorry, you are wrong. Flat out, wrong.

You seem convinced that CRA caused a bubble but your analysis amounts to looking at a graph and a date on legislation. I am sorry but I don't think that is exactly proof. I admit that I have no proven that the bubble in 97 was just about global economic trends but I didn't mean to act like I was.

I am not saying that the borrowers are free of guilt. They just haven't been talked about until now. Seems pretty pointless to blame them as they are the ones that are getting foreclosed on and their "guilt" is rather established already.

You keep acting like F&F was mandating all of these loans which they were not. That is simply a falsehood.

You also seem set to ignore the fact that ratings agencies have a responsibility to rate both mortgages and MBS.

You also seem set to ignore the lowering of lending standards well beyond the lowered standards allowed under the CRA.

You also seem set to ignore the fact that all of these companies are responsible for their own choices for better or worse. How do you think this all went down? From what you said it is like these institutions made financial decisions by blindly trusting F&F. Do you think that passes as an excuse for the CEO's of these companies? Sorry I lost all your money, I know you pay me millions upon millions of dollars to make these decisions but I figured why think for myself when I can let F&F think for me. Yeah they used this new formula for packaging MBS but I didn't bother to check it out. I figure we should just take it on faith that F&F knows what it is doing. Sure we employee all these people who are supposed to know this stuff but lets ignore that too.

As for GSA, look at the companies that were bailed out. Look at how their willingness to take on risk changed. Investment firms were historically far more willing to take risks than commercial banks. But hey lets just assume that had nothing to do with it.

Looking at relevant legislation, and empirical data on a graph is 'all' I'm looking at? Should I consult a ouija board, or the stars too?

Looking at relevant data, and relevant legislation seems to be the proper course of action for investigating the empirical evidence for a given topic. What would you suggest?

F&F didn't have to mandate anything. As I've said before, they are the largest player, with the biggest authority in the market, backed by the Federal Government. When they move.... whether they "mandate it" or not, the market follows. That's how that works.

The same is true in other completely private markets. Take Intel. Intel is the 6000 lbs gorilla of the microchip market. When Intel says "we're going to do this", suddenly the market follows. Why? They are the biggest player, they hold the cards, they have the biggest weight in the market.

When Intel integrated graphic processors into their CPU chips, AMD started integrating ATI graphics processors into their CPU chips. Did Intel "mandate" it? No, they just happen to be the biggest player in the game, and they move the market, whether they intend to, or not.

Fannie and Freddie.... Same thing.

Again, the CRA lowered the standard to sub-prime. There is no standard below sub-prime. There is no Sub-sub-prime. The prime rate standard, is in fact the only standard.

So when you say they lowered the standard below the CRA.... I have no idea what you are talking about because there is nothing below sub-prime.

From what you said it is like these institutions made financial decisions by blindly trusting F&F. Do you think that passes as an excuse for the CEO's of these companies?

Again, I don't understand this comment. Yes, the fact the institution did make decisions blindly trusting F&F. Like I posted before, Countrywide was a preferred partner of Fannie Mae, and was given awards by Fannie Mae for doing what Fannie Mae wanted. I posted you the article written by Fannie Mae back in 2000, about this very issue.

Now does it excuse anything? No. I never said, nor suggested they were excused. You can't find any comment by me, which suggests that they should be excused for this. There should never have been a bailout of any type. The companies should have been bankrupted, and sold off.

Again, the difference between you and me, is not that. The difference is, I want to focus on causes, not resulting problems. What was the cause? The cause was F&F, and the Government pushing sub-prime loans. If we don't deal with the cause, and we only focus on smacking around the banks, in 10 years time, we'll be right back here with another crash, because as long as government is pushing policies to give loans to people who don't qualify.... this is the outcome. You can scream at the banks for following the government until the end of time, and they are still going to do it. I promise you. You can fine them, jail them, attack them, run around in some park, with signs saying 'eat the rich'. It won't change anything, and we'll end up right back here all over again. You have to stop the cause.... stop government from pushing bad loans.

As for GSA, look at the companies that were bailed out. Look at how their willingness to take on risk changed. Investment firms were historically far more willing to take risks than commercial banks. But hey lets just assume that had nothing to do with it

The Glass Steagall Act has nothing to do with investment firms. GSA did not prevent them from existing. GSA did not prevent them from growing. GSA did not prevent them from taking risks. GSA did not prevent them from buying MBSs. GSA did not prevent them from buying CDOs. GSA did not prevent them from doing anything at all.

The *ONLY* thing that GSA prevented, was it prevented them from ALSO running retail savings and loans, running Commercial banking, and from offering insurance.

Bear Stearns, Merrill Lynch, and Countrywide, were all just, and only, investment banks. None of them were doing retail, commercial, or insurance.

GSA would have had ZERO effect on any of them. None of them were Financial Holding Companies. None of them were affected by GSA, or GLBA.

If the GSA was the law of the land, it would have had zero effect on the crash of all these firms.

And by way... investment firms always take more risk than banks. That's the nature of the beast. The whole reason investment firms exist, is because banks don't pay jack on their deposits. That's why *I* invest. Do I want 0.01% interest from my account at the bank? Or do I want 26% interest I earned at my mutual fund investments?.............

Hmmmm.... 0.01%, or 26%.... hmmmm...... I want the 26%. That's why I hired my mutual fund broker to buy those investments for me.

The cause is clearly without a doubt the fact that decisions were made with bad information.

The cause is clearly NOT a result of mandated loans based on the CRA. It is a FACT that sub-prime loans were willingly taken on by these institutions independent of mandates of the law.

F&F could have made MBS with all sub-prime loans. That doesn't mean the market will automatically follow suit and rate them AAA and buy them like they are. You keep acting like F&F is dictating the nature of the market while completely ignoring the fact that they are NOT A RATINGS AGENCY. F&F can make all of the MBS they want but it is the choice of those institutions to buy them.

There is not a single decision maker at these institutions that will ever say that F&F dictated to them beyond the mandates of the CRA. Yet that is exactly what you are claiming which is total nonsense.

Your understanding of a single cause in 1997 is a fools errand. There is little to no reason to think the historical nature of this bubble is due to something that happened in 97 nor is there great evidence that mandated loans were a major cause.

MBS are a significantly different issue than mandated loans. They don't represent a mandate by government. Instead they are a financial instrument that is meant to help manage risk, whether it is mandated or not. The MBS business requires the ratings agencies and the buyers of the MBS to have good information. They didn't. MBS are a clear cause of the bubble and the crash.

As for GSA, I think there is far more evidence that it resulted in increased risk across the board and it played a part in the bailout.

 

[Erand7899]

THOSE evil ******* "rich" people eat well while the less affluent have to scrape by.

That's the gist of the complaint.

But while the new lolberal talking point is making the rounds, I can't help but ask:

what exactly do these guys propose as the solution for this disparity?

Strip away all the excess verbiage (verbal camouflage, since they don't want to ever come right out and SAY it) and their agenda is revealed. (This is why they don't care to address their 'solution" in clear terms.)

They want to -- they think they should be entitled to do it in fact -- and they WILL seek to confiscate from the evil rich bastards ever increasing amounts of their wealth. It doesn't belong to them, you see. They didn't earn that. They didn't build that. (Sound familiar?)

It isn't "really" the wealth of the rich greedy bastards. No. No no. It's stuff they somehow denied the other 99% from having. So, whether it takes the form of outright confiscation or just the death of a million cuts (taxation without end), the 'solution" is some kind of TAKING. It's a reclamation, you see. It's not "taking from the rich." It's taking BACK from the "rich" to redistribute to everybody ELSE.

But enough of this analysis. Let's have the spokespersons for this new liberal talking point meme step up to the podium and cut the malarkey.

The rich have more. The less affluent (the poor, the 99%) have less. There is an income inequality. There is a wealth disparity. Now, what is the proposed "lib" solution to this identified "problem?"

We await your eloquence.

Corruption is the single most eloquent explanation for why your beloved "greedy rich bastards" eat better that the poor. Daily reports from around the planet confirm how government bureaucrats abuse their offices for personal gain. In the US, the greedy rich bastards bribed elected Republicans AND Democrats over the past four decades for favorable tax and trade policies that have increased a few private fortunes at the expense of millions of lost middle class jobs, pension plans, and homes. The solution was pioneered by FDR during WWII; in today's class war impose a 100% tax rates on all US incomes over 1,000,000 dollars. Any of the rich greedy pseudo job creators in the US who don't like it are free to polish their Mandarin and move where they will feel more at home.

We await your wimpish, whining, weaseling response.

Moving to a place where they will feel more at home, is exactly what they would do, and they would take a whole lot of jobs with them. Investment, (money) moves to the place where it earns the best returns consistent with acceptable risk. That is a natural law that neither you, nor Obama can repeal.

Without investment, there are few jobs for the millions of people who do not have capital of their own. Today, we live in a world where capital can move anywhere in the world in a matter of seconds. And, like any other market, movement occurs on the margins, but those margins have serious affects on economic growth. When an investor can make a better return by investing in India or China, marginal job growth will occur in India or China, and marginal job loss will occur here.

 

[Erand7899]

Any job that pays a wage, requires an entity that has the capital to pay that wage. No capital, no paying jobs.

Good paying jobs that offer security to workers, requires a lot of capital. It requires those evil, greedy, rich bastards to risk their capital in an enterprise that requires workers. No, evil, greedy, rich bastards, means no capital to provide good paying jobs with job security.

There is no free lunch, and there never will be a free lunch.

 

[Bombur]

Any job that pays a wage, requires an entity that has the capital to pay that wage. No capital, no paying jobs.

Good paying jobs that offer security to workers, requires a lot of capital. It requires those evil, greedy, rich bastards to risk their capital in an enterprise that requires workers. No, evil, greedy, rich bastards, means no capital to provide good paying jobs with job security.

There is no free lunch, and there never will be a free lunch.

No demand for a product then there is no demand for labor or capital.

Look what we have now. Corporations shed their debt and their workforce.

 

[gnarlylove]

Androw, you are mighty proud of yourself. And there are plenty of reasons to be glad you are working. You certainly deserve some of the merit you receive, but you are blind if you think you deserve even half of what you make.

It results from the fact that your success could not exist without the complexity of social cooperation. Your idea of earning is conflated with the idea with what you actually make. You ignore the fact I said the truth lies somewhere in the middle of that exaggerated pie. I know it takes hard work (for most people) but hard labor is not how you win on the stock market, its intelligence which is a different kind of "work" and is by no means a scientific definition of "work."

Regardless, those born into cushy lives as a result of affluent parents account for the majority of success in this country--it breeds success because the opportunities to acheive and become are so readily apparent. In low income communities, not that they are any less of a human, but they indeed are offered sub-par education and virtually no good opportunities. You act like you have achieved everything on your own when in reality you heavily depend on the cohesion of society essential to generating your capital. You were raised for years and fed by your family before you had a clue of what independence meant.

I am not trying to take away your efforts over the years to become the prideful person you are, they must be acknowledged and worshiped--you wouldn't have it any other way. But if you think your labor of investing stocks and taking risks deserves the pay you receive, then you exist in a separate part of the economy isolated from those that actually work hard and are not that successful in capital. But thank god capital is not our only motivation. Many of us low income folks note the primary things in life are loving one another and respecting our fellow man whether they have money or not. Apparently this human decency has not trickled up to you egotistical world.

A 16 hour work day getting paid under $10/hr is magnitudes above your labor and yet they "earn" far less than you. Garbage men are absolutely essential and yet are paid poverty wages more often than not. This is the result of social ranking, not your got-dang "hard-work."

Both my parents and I have worked since 16 in demeaning and hard labor jobs. I managed to get out of menial labor and tried wilderness counseling but now I'm back to square one working in menail labor because where I live and nothing more. Opportunities don't exist like they do where you live and you take that for granted. Not to mention my parents are over 60 and still grinding it. My mother works 60 hours a week minimum and often works up to 99 hours lifting 300 and 400 pound elderly working in a nursing home.

Though we've always worked hard our whole lives, we are still ranked as low income qualifying for food stamps, heat programs etc. but we don't because we have pride. This is supposedly the same idea and work ethic that drives your investments? This makes me sick with your un-deserved air of self-accomplishment and merit. You simply ignore parts of reality so you can feel like you earned everything you have and then have the audacity to ask the question from your privileged kingdom "What's a matter little people? Can't work hard to become richer?" Well, that's cause it ain't that black and white.

 

[dblack]

I'm still not clear whether those opposed to 'too much' income inequality are claiming the income is gained unjustly, or whether they think it's wrong regardless. Is there anything wrong, in your view, with extreme incomes that are generated honestly, via voluntary transactions with others?

 

[gnarlylove]

I'm still not clear whether those opposed to 'too much' income inequality are claiming the income is gained unjustly, or whether they think it's wrong regardless. Is there anything wrong, in your view, with extreme incomes that are generated honestly, via voluntary transactions with others?

Owning 10 mansions and 50 cars is simply unsustainable. These kinds of exorbitance isolate the elite into thinking they've earned everything by their lonesome. Excessive egos, as on display in this message board, is the number one reason preventing humanity from acknowledging our similarities and realizing they far outweigh our differences.

It seems TV shows exemplifying wealthy estates have caught the attention of virtually all people and we only want that. We forget we are part of a human race that can create better lives for everyone, not just ourselves yet we focus on bettering our own life as the only priority. If our success happens to spill into the economy and other people, great, but it was not an intention.

You seem to think there should be no cap on individual prosperity. While I think people should be free to pursue there private aims (wealth accumulation, tons of sex, plethora of beatnik experience etc) as long as these personal projects doesn't harm others--the classic libertarian principle. Of course defining harm can be challenging but I think we know harm when we feel it ourselves so...

Richard Rorty elaborates on this magnificently. He advocates us to "drop the demand for a theory which unifies the public and private... [and] treat the demands of self-creation and of human solidarity as equally valid, yet forever incommensurable." Hence, he calls himself a liberal ironist and defines it thusly:

I borrow my definition of "liberal from Judith Skhlar, who says that liberals are the people who think that cruelty is the worst thing we do. I use "ironist" to name the sort of person who faces up to the contingency of his or her own most central beliefs and desires--someone sufficiently historicist and nominalist to have abandoned the idea that those central beliefs and desires refer back to something beyond the reach of time and chance. Liberal ironists are people who include among these ungroundable desires their own hope that suffering will be diminished, that the humiliation of human beings by other human beings may cease.

Basically all our beliefs come from our conditions. No belief is eternal or refers to beyond our conditions (though we may claim such). So any belief may or may not conflict with the public good. When it does we ought to investigate how essential our conditional belief is. The belief that cruelty is wrong is just another ungrounded conditional belief but iif we saw it in operation we would see the blossoming of humanity. I think our personal whims and projects make sense to set aside WHEN they conflict with harming another human being. Of course this should be decided case by case but this is a general rule of thumb.

 

[dblack]

I'm still not clear whether those opposed to 'too much' income inequality are claiming the income is gained unjustly, or whether they think it's wrong regardless. Is there anything wrong, in your view, with extreme incomes that are generated honestly, via voluntary transactions with others?

Owning 10 mansions and 50 cars is simply unsustainable. These kinds of exorbitance isolate the elite into thinking they've earned everything by their lonesome. Excessive egos, as on display in this message board, is the number one reason preventing humanity from acknowledging our similarities and realizing they far outweigh our differences.

It seems TV shows exemplifying wealthy estates have caught the attention of virtually all people and we only want that. We forget we are part of a human race that can create better lives for everyone, not just ourselves yet we focus on bettering our own life as the only priority. If our success happens to spill into the economy and other people, great, but it was not an intention.

You seem to think there should be no cap on individual prosperity. While I think people should be free to pursue there private aims (wealth accumulation, tons of sex, plethora of beatnik experience etc) as long as these personal projects doesn't harm others--the classic libertarian principle. Of course defining harm can be challenging but I think we know harm when we feel it ourselves so...

Richard Rorty elaborates on this magnificently. He advocates us to "drop the demand for a theory which unifies the public and private... [and] treat the demands of self-creation and of human solidarity as equally valid, yet forever incommensurable." Hence, he calls himself a liberal ironist and defines it thusly:

I borrow my definition of "liberal from Judith Skhlar, who says that liberals are the people who think that cruelty is the worst thing we do. I use "ironist" to name the sort of person who faces up to the contingency of his or her own most central beliefs and desires--someone sufficiently historicist and nominalist to have abandoned the idea that those central beliefs and desires refer back to something beyond the reach of time and chance. Liberal ironists are people who include among these ungroundable desires their own hope that suffering will be diminished, that the humiliation of human beings by other human beings may cease.

Basically all our beliefs come from our conditions. No belief is eternal or refers to beyond our conditions (though we may claim such). So any belief may or may not conflict with the public good. When it does we ought to investigate how essential our conditional belief is. The belief that cruelty is wrong is just another ungrounded conditional belief but iif we saw it in operation we would see the blossoming of humanity. I think our personal whims and projects make sense to set aside WHEN they conflict with harming another human being. Of course this should be decided case by case but this is a general rule of thumb.

Hmm... well, it's not really clear to me what you're getting at. You seem to be answering my question with a 'yes', that even if income is derived from honest, voluntary transactions, there should some upper maximum. Are you presuming that capping upper incomes would somehow benefit those with lower incomes? How so?

Income is an expression of how much society values the work that someone does. Arbitrarily limiting the income of some, won't change how people value the work of others. Arguably, it would lower the income of lesser valued work because, relatively, it would still be valued less by consumers and investors. The point is, honest income disparity is an accurate difference in how much society values different kinds of work. Setting nominal limits (upper or lower) on incomes doesn't change that evaluation. It just monkeys with the scale.

 

[Erand7899]

I'm still not clear whether those opposed to 'too much' income inequality are claiming the income is gained unjustly, or whether they think it's wrong regardless. Is there anything wrong, in your view, with extreme incomes that are generated honestly, via voluntary transactions with others?

Owning 10 mansions and 50 cars is simply unsustainable. These kinds of exorbitance isolate the elite into thinking they've earned everything by their lonesome. Excessive egos, as on display in this message board, is the number one reason preventing humanity from acknowledging our similarities and realizing they far outweigh our differences.

It seems TV shows exemplifying wealthy estates have caught the attention of virtually all people and we only want that. We forget we are part of a human race that can create better lives for everyone, not just ourselves yet we focus on bettering our own life as the only priority. If our success happens to spill into the economy and other people, great, but it was not an intention.

You seem to think there should be no cap on individual prosperity. While I think people should be free to pursue there private aims (wealth accumulation, tons of sex, plethora of beatnik experience etc) as long as these personal projects doesn't harm others--the classic libertarian principle. Of course defining harm can be challenging but I think we know harm when we feel it ourselves so...

Richard Rorty elaborates on this magnificently. He advocates us to "drop the demand for a theory which unifies the public and private... [and] treat the demands of self-creation and of human solidarity as equally valid, yet forever incommensurable." Hence, he calls himself a liberal ironist and defines it thusly:

I borrow my definition of "liberal from Judith Skhlar, who says that liberals are the people who think that cruelty is the worst thing we do. I use "ironist" to name the sort of person who faces up to the contingency of his or her own most central beliefs and desires--someone sufficiently historicist and nominalist to have abandoned the idea that those central beliefs and desires refer back to something beyond the reach of time and chance. Liberal ironists are people who include among these ungroundable desires their own hope that suffering will be diminished, that the humiliation of human beings by other human beings may cease.

Basically all our beliefs come from our conditions. No belief is eternal or refers to beyond our conditions (though we may claim such). So any belief may or may not conflict with the public good. When it does we ought to investigate how essential our conditional belief is. The belief that cruelty is wrong is just another ungrounded conditional belief but iif we saw it in operation we would see the blossoming of humanity. I think our personal whims and projects make sense to set aside WHEN they conflict with harming another human being. Of course this should be decided case by case but this is a general rule of thumb.

No one is entitled to harm another human being, and that is definitely a general rule of thumb, not to mention a general rule of law in this country. Or, at least that was the case before the Supreme Court expanded the right of eminent domain.

However, the idea that the success of one person harms another person who has not met with the same success is nonsense. What is harmful to many is being sold the idea that they cannot escape the condition they were born into. That is so false as to be ridiculous. Anyone who really desires to escape, and who puts forth the effort to escape can readily do so.

However, if one is sold on the idea that escape is impossible, or even improbable, they lose the desire to put much effort into the attempt.

 

[Bombur]

I'm still not clear whether those opposed to 'too much' income inequality are claiming the income is gained unjustly, or whether they think it's wrong regardless. Is there anything wrong, in your view, with extreme incomes that are generated honestly, via voluntary transactions with others?

Growing income inequality is likely due to market trends as opposed to anything anyone did themselves. This discussion shouldn't be considered to be a knock against rich people or the middle class. They are doing what they are supposed to do in the system. The problem is the current state of the system.

It is not their job to fix it. It is the job of the government.

 

[gnarlylove]

If you think hunger insecurity is not a social harm when there is technically enough food to feed the entire planet 2,700 kilo calories, then you and I have different ideas. I view this intentional deprivation as indirect social harm.

Also, Social mobility is not lubricated like you believe. See the link provided to see why America is the worst developed nation when it comes social mobility.

Furthermore, there are many more factors to exiting poverty than "a desire to leave low-income ranks." The way you say it sounds so easy, because you're only using words and not demonstrating for us what it really means to grow up in poverty and then leave it. You wouldn't even know because you didn't come from a family that makes under 22,000 a year. So you listen to what you want to hear and validates you naieve social views--coming from a middle class family you have no flippin clue what real poverty is, your whole life is spent avoiding it unintentionally. It turns out I'd know since the average income in my area is 29,000/year. Education, opportunity and malnutrition play a huge role in whether one leaps out of poverty by "trying hard enough."

It isn't for lack of trying, but its a lack of opportunity. Sure, a few thousand can climb out of poverty to middle class incomes through luck and hard work and knowing the right people but you offer no feasible hope for the millions lagging in poverty or on the border of poverty. Without offering more opportunity then low income folks or no income simply lack viable avenues.

 

[dblack]

I'm still not clear whether those opposed to 'too much' income inequality are claiming the income is gained unjustly, or whether they think it's wrong regardless. Is there anything wrong, in your view, with extreme incomes that are generated honestly, via voluntary transactions with others?

Growing income inequality is likely due to market trends as opposed to anything anyone did themselves. This discussion shouldn't be considered to be a knock against rich people or the middle class. They are doing what they are supposed to do in the system. The problem is the current state of the system.

It is not their job to fix it. It is the job of the government.

Ok, so you're agreeing that there's nothing wrong with honestly allocated income disparity? I agree. I also agree there are significant problems with the current state of the system, problems that we need to address.

What do you think those problems are, and how should we address them?

 

[hunarcy]

I'm still not clear whether those opposed to 'too much' income inequality are claiming the income is gained unjustly, or whether they think it's wrong regardless. Is there anything wrong, in your view, with extreme incomes that are generated honestly, via voluntary transactions with others?

They don't even see that while they complain about "income inequality", even they are benefitting from capitalism. It's almost as if they wish the poor were in abject poverty just so the rich don't advance either. I have visited West Africa and I know that capitalism has created a situation where the poor here are like kings compared to the middle class in Ghana. It wasn't socialism that led us to live the lives we have and socialism won't keep us from declining if they succeed in foisting it on us as a way of life.

 

[Indeependent]

I'm still not clear whether those opposed to 'too much' income inequality are claiming the income is gained unjustly, or whether they think it's wrong regardless. Is there anything wrong, in your view, with extreme incomes that are generated honestly, via voluntary transactions with others?

They don't even see that while they complain about "income inequality", even they are benefitting from capitalism. It's almost as if they wish the poor were in abject poverty just so the rich don't advance either. I have visited West Africa and I know that capitalism has created a situation where the poor here are like kings compared to the middle class in Ghana. It wasn't socialism that led us to live the lives we have and socialism won't keep us from declining if they succeed in foisting it on us as a way of life.

Warlords practice a flavor of capitalism without representation or legal recourse.

 

[Bombur]

I'm still not clear whether those opposed to 'too much' income inequality are claiming the income is gained unjustly, or whether they think it's wrong regardless. Is there anything wrong, in your view, with extreme incomes that are generated honestly, via voluntary transactions with others?

Growing income inequality is likely due to market trends as opposed to anything anyone did themselves. This discussion shouldn't be considered to be a knock against rich people or the middle class. They are doing what they are supposed to do in the system. The problem is the current state of the system.

It is not their job to fix it. It is the job of the government.

Ok, so you're agreeing that there's nothing wrong with honestly allocated income disparity? I agree. I also agree there are significant problems with the current state of the system, problems that we need to address.

What do you think those problems are, and how should we address them?

I am not saying there is nothing wrong with it. I am saying it is not the fault of those benefiting from it or those who are hurt by it.

It just isn't about income inequality but what is causing it. Namely a weak labor market, stagnant wages, a trade imbalance, a regressive tax code, a tax code that hurt US production, economic volatility, increased poverty, increased crime, and more.

 

[gnarlylove]

The capitalist class, who own the means of production have become increasingly elite and astute at propaganda (controlling the mass media). Each year with more mergers and acquisitions this small elite group grow in political and global control, having convinced most of us that we that there is no other way to operate a society and we must rely on them for sustenance and freedom.

I don't doubt the majority favors the capitalist class, they bring such treats to those who can afford it. But the fact is a growing minority of the majority (i.e. the working class) are expressing our dissatisfaction with the way the capitalist class executes its power and indeed, the power they wield is absolutely corrupting. I know many of you disagree but I strongly believe no human should go without food when there is enough kilo calories to feed every single person (and there is, see Josette Sheeran work as UN Executive Director). This is a warfare against humanity, against our very own kind over profit.

Profit is not more valuable than life and to withhold food preventing proper human development to continue exploiting cheap labor is making profits more appealing than human life. To those of us with empathy, we say **** THAT! Human life is in most cases more valuable than profit but as far as the capitalist class is concerned, they are ignoring this truth in order to continue global exploitation and we go along with them every step of the way.

 

[Toddsterpatriot]

So, you're planning on contributing to Money Mitt's refund?

"Mitt Romney made $13.7 million last year and paid $1.94 million in federal income taxes, giving him an effective tax rate of 14.1%, his campaign said Friday."

Romney paid 14% effective tax rate in 2011 - Sep. 21, 2012

Good for him! That is outstanding. Sadly, it's 4.1% more than than any of us should be paying.

Stop Whining

"Roosevelt’s debt ceiling battle actually began right after Pearl Harbor.

"The nation needed a revenue boost to wage and win the war.
FDR and his New Dealers wanted to finance the war equitably, with stiff tax rates on high incomes.

"How stiff?

"FDR proposed a 100 percent top tax rate.

"At a time of 'grave national danger,' Roosevelt told Congress in April 1942, 'no American citizen ought to have a net income, after he has paid his taxes, of more than $25,000 a year.'

"That would be about $350,000 in today’s dollars.

"FDR 'settled' for a marginal tax rate of 94%.

"Makes today's super-wealthy seem pretty whiny and greedy, doesn't it?"

Doesn't it.

FDR's Proposed Marginal Tax Rate Was 100%

Yeah, FDR's failings in economics are well known.
No American president ought to violate the Constitution like he did.

 

[Toddsterpatriot]

Mitt Romney gave $4 million to charity.

That bastard! Giving away over 43% of his income. Awful, just awful.

That could mean many things, including PR stunt (in addition to mere charity). I don't think it's that though. What I hope it shows is that Romney is admitting that 13.4 million wasn't earned by him in full. Without our country's citizens and indeed the global economy he could never attain the success he has. So he is simply giving back to the community that helped him generatemillions in profits, which is different than earning precisely 13.4M in profits. It is naive and brutish to think anyone "fully and completely" earns every penny. They depend on complex social nexus created and reified by everyone, not by a single individual. Egos kill.

Without our country's citizens and indeed the global economy he could never attain the success he has.

So what?

 

[Toddsterpatriot]

So, you're planning on contributing to Money Mitt's refund?

"Mitt Romney made $13.7 million last year and paid $1.94 million in federal income taxes, giving him an effective tax rate of 14.1%, his campaign said Friday."

Romney paid 14% effective tax rate in 2011 - Sep. 21, 2012

Mitt Romney made $13.7 million last year and paid $1.94 million in federal income taxes and gave $4 million to charity.

That bastard! Giving away over 43% of his income. Awful, just awful.

You're right.
It should've been 94%.
Greedy ****, tsk tsk.

**** you, stupid Commie.