When I first heard of the “Wall Street” protests my reaction was one of support. The initial government knee-jerk reaction of gloom and doom if we don’t bail out the “too big to fail” financial institutions and some of the subsequent reactions i.e. the post-crash overly restrictive loan policies the same bailed out with our money financial institutions instituted which caused an unnecessary crunch on small businesses that contributed to the ongoing recession were at the root of our current economic situation.
And this was all done while Wall Street payed out even higher bonuses to their employees then before they had wiped out half of my 401K savings. (I have the receipts to prove it).
Then I saw the news – interviews with the protesters - I didn’t hear anyone clearly articulate what the protest was about – certainly not the things I believed in. In some cases I thought “they are half-wits – we are doomed” (of course trusting the media to fairly interview representative members of the protesting parties really wasn’t a good idea).
Then I heard U.S. Representative Peter DeFazio’s speech on the Wall Street Protest– he so clearly spoke to the very heart of what the protests are all about and why they happened.
http://www.youtube.com/watch?v=hNNYWAZlCow
If the link doesn’t work than you can just cut and paste – it is well worth it.
There is also a good article online at Slate.com posted by Annie Lowrey (link below)
It is not easy to say just what Occupy Wall Street wants; there is no concise list of specific demands. But the gist of the quickly snowballing movement is clear. Wall Street has not accepted responsibility for its role in the financial crisis and ensuing recession. It has done more harm than good for average citizens and businesses.
http://www.slate.com/articles/business/moneybox/2011/10/occupy_wall_street_says_the_top_one_1_percent_of_americans_have_.html
and as Annie Lowery stated at the end of her article
Whether Occupy Wall Street can help to rectify that imbalance—who knows. But there is certainly value in at least making sure Americans know just how unequal the country is.
I don't think DeFazio spoke clearly about what the protests are about at all. If anything DeFazio to me tries to shield Congress's and the Administration's culpability and complicity in the entire affair. I totally believe that bankers should be on trial and when found guilty in jail for what has happened. Yet where are the investigations Justice Department? Why were previous regulations unenforced SEC, Federal Reserve, and other institutions with that role? Why were deficiencies in regulation not changed Congress when you came out with Frank-Dodd?
ReplyDeleteThe real issue in my eyes is all the close personal relationships politicians have with people with deep pockets. Furthermore, how can Congress be beholden to the people if the deck is stacked against the people from voting incumbent politicians out of office? I'm not sure if by some miracle that all US politicians got voted out in 2012 would change any of this, but it would be a start in my mind. Especially if the people then voted that entire Congress out in 2014 if they carry on with the same lame policies of not trying to compromise towards a better future for our country.
Boz - i don't see where DeFazio is trying to shield Congress/Admin - he may not be calling them out to the degree you would like but this is a five minute speech - do you disagree with WHAT he said? He clearly pointed his finger at Paulsen (Bush) and Geitner (Obama).
ReplyDeleteI am in agreement on the relationship between money and our politicians and the lack of regulations (DeFazio pointed that out) and the lack of criminal proceedings against those responsible but I would like to acknowledge the positives in DeFazio's speech.
One of the things I find interesting about the Occupy Wall Street movement is that it truly does appear to be a people generated protest. A significant fraction of the Tea Party activities have been financed/organized/pushed by big right-wing groups. I think that may be part of why there isn’t a laser focus on goals, people are pissed and they are demonstrating. I think the other thing that is interesting is that this (and, as much as I hate to say it) combined with the more grass roots Tea Bagger stuff is similar in some ways to the Arab Spring movements. A big part of their motivation is the economic disparity between rich and poor. In fact, the CIA itself says that there is a bigger gap between rich and poor in the US than between rich and poor in Egypt. Lastly, I agree with some of BOz’s arguments. There were 10,000 cases against bankers brought after the savings and loan blow up – after this one there were zero. I actually think this shows how much more control Wall St exerts today than back then. Kevin Phillips discusses this in several of his books, most recently American Theocracy.
ReplyDeleteIt's pretty much academic at this point, but the Bush administration twice (2003 and 2005) tried to enforce stricter regulation on Fannie Mae and Freddie Mac just to be stopped by Barnie Frank and others. But we could debate "who" caused "what" forever and get nowhere.
ReplyDeleteWhat's really concerning is that between the Wall Street protests, demand for tax increases on the wealthy and corporations - and of course the liberal media reporting that "..most Americans feel the wealthy should pay more taxes.." (I'm sure a non-biased survey...??), there's very little discussion about policies that will significantly reduce unemployment. I would say that most Americans probably feel that unemployment is a much bigger issue than weather Warren Buffet isn't paying as much as he would like to in Taxes.
Of course, I can't forget about Obama's "new" stimulus package (i.e., "Jobs Plan") with a price tag of $447B. I mean, just because the last stimulus (Feb 2009) cost the taxpayers $228K+ per-job when unemployment was 8.2% (now 9.1%) can be seen as a failure, there's no reason to expect this one also to be a failure. That is except for the definition of insanity being to do the same thing over and over and expect different results...
But it doesn't matter. Obama is no longer governing anyway, he's in full "Campaign 2012" mode - his Jobs Plan is simply a re-election tactic than an actual useful plan. Why else would he create a plan that is a mini-version of the failed Feb'09 plan - which by any sane measure should not pass, is quoted saying his plan works only "..if passed in it's entirety.." providing the easy "out" for any slight modification, and seemingly uses every media opportunity to advance class warfare by attacking the republicans, the wealthy, and corporations.
So again, how exactly does attacking corporations and raising taxes reduce unemployment?
A few corrections...
ReplyDelete1. The Wall Street Protest is not a people generated protest, it's backed and organized by Adbusters, a Canadian anti-capitalist group.
But this does raise an interesting points. For those that are "sympathetic to this organization", you should really ask yourself - are you sure you wouldn't be happier in a socialist society? There's nothing wrong with that - it seems to work for other countries such as Canada and Switzerland.
Which brings me to another topic that's really been bothering me. I realize it's probably just too complex for me to understand, so please explain this to me like I'm a 6 year old. I've heard liberals (from outside and inside this blog) say the wealthy aren't paying their "fair share". You only need to watch the liberal media, Obama, or inside this blog to find such a statement. But what I don't understand is with the bottom ~50% paying 0 Federal Income taxes and the top 10% paying 70% of the Income Tax burden, how is it the wealthy are not paying their "fair share"? If someone could explain the liberal thinking to me without going into how the wealthy aren't paying as much as they used to (still don't see how that's is that relevant..?) I would appreciate it.
2. With regard to the housing burst - No one in the financial institution did anything illegal. At least nothing more illegal than always (like a CEO/CFO pulling in orders from future quarters to make their current quarter look good, or Fannie Mae and Freddie Mac giving out loans to someone they know probably can't repay it just to collect the fees and meet bonus thresholds, or a politician making policies to get re-elected regardless of whether the policy makes good financial sense, or the S&P and other credit rating agencies handing out AAA credit ratings). Bottom line is that a lot of people made a lot of decisions that caused the crash - not to forget the "home-owners" themselves that purchased houses they clearly couldn't afford - no money down, 60 year mortgages, interest only, baloon payments, etc.. So if your looking to throw those responsible for the housing bust in jail, you can start with Wall Street then make you're way round Washington, and last stop is on Main Street.
JF - That is an interesting question – would I be happier in a “socialist” society – certainly if you look at the data…
ReplyDelete(Note – In responding to your comment I wrote enough to make this into a blog post but decided in fairness to keep this as a comment so as to not have a bully pulpit - I can post funny pictures that back my position – JF I do have an offer for you at the end of this comment.
According to a Gallup poll while the United States may still be the richest nation on Earth, it can't claim to be as happy as Denmark or Finland. In fact, according to a new analysis of data the relationship between overall life satisfaction and wealth may not be as straightforward as previously thought.
Here are the top 10 countries:
1. Denmark: 72%
2. Canada: 69%
2. Sweden: 69%
4. Australia: 66%
5. Finland: 64%
5. Venezuela: 64%
7. Israel: 63%
7. New Zealand: 63%
9. Netherlands: 62%
9. Ireland: 62%
http://www.gallup.com/poll/147167/High-Wellbeing-Eludes-Masses-Countries-Worldwide.aspx
The U.S came in 12th at 59%. So what most of us refer to as the greatest country in the world is behind sandwiched between Panama and Austria – we’re behind Venezuela??
How is that possible? Now this is not where I scream “Via la Revolution” and I grab my Che Guevara hat but rather point to the “Occupy Wall Street” movement. My last two blogs have touched on the subject.
You are correct in pointing out the “Occupy Wall Street” movement was the brainchild of Adbusters –which has been described as some as anti-capitalist movement or by others as a not-for-profit, anti-consumerist, pro-environment organization. I was not able to find how many people subscribed to their magazine or even how many people had ever heard of them prior to this (I count myself as one who had not). I am willing to say that the number of people who are now participating or at a minimum sympathetic to the “Occupy Wall Street” movement have transformed this to a people generated event. Since the idea was disseminated it has been spontaneously taken up by all the people of the world. The protests are now ongoing in 82 different countries.
There is a general dissatisfaction with the direction things are going. There is a general belief that the system has been slowly corrupted to favor a very small percentage the majority of people.
my response to JF was so long I had to break it into two comments.
ReplyDeleteWe can argue how many people pay federal income taxes but no one is immune from paying taxes – a Tax Policy Center paper shows that about half of people who don’t owe income tax are off the rolls not because they take advantage of tax breaks but rather because they have low incomes. For example, a couple with two children earning less than $26,400 will pay no federal income tax this year because their $11,600 standard deduction and four exemptions of $3,700 each reduce their taxable income to zero. The basic structure of the income tax simply exempts subsistence levels of income from tax.
What is left out of the statement that ~50% Americans do not pay federal income taxes” – is that they do pay taxes - payroll taxes, excise taxes, sales taxes, state income taxes, and property taxes. Are taxes not taxes?
And these Americans contribute in other ways - Here’s what we ask of the people that pay no taxes – send your kids to fight our wars. According to a 2007 Associated Press analysis, "nearly three-fourths of [U.S. troops] killed in Iraq came from towns where the per capita income was below the national average. More than half came from towns where the percentage of people living in poverty topped the national average."
As Warren Buffet pointed out some of the tax breaks available for investment managers who earn billions but are allowed to classify income as “carried interest,” thereby getting a bargain 15 percent tax rate. Or others that own stock index futures for 10 minutes and have 60 percent of their gain taxed at 15 percent, as if they’d been long-term investors.
Fair share of taxes? – That is a tough nut to crack. Certainly we can point to the last 30 years or Regan’s supply side economics which includes Bush’s doubling down on supply-side economics with the tax cuts in 2001 and 2003, extended by Obama. I would think fair taxes would exist in a system that allowed everyone to do well or at least not let things get worse. I think the numbers speak for themselves (or at least until my next blog).
Regarding your second point - There was criminal intent in the housing bubble burst – what there has not been is prosecution. Financial organizations bundled bonds, derivatives and loans (the very loans they sold) and sold these toxic assets labeled as ‘Grade A’ instead of calling them for what they were – high-risk junk. Is it the “home owner” then who crashed the system or those who “criminally” defrauded investors? How many people have gone to jail for what is certainly the greatest heist in recorded history?
“Merrill Lynch, for example, understated its risky mortgage holdings by hundreds of billions of dollars. And public comments made by Angelo R. Mozilo, the chief executive of Countrywide Financial, praising his mortgage company’s practices were at odds with derisive statements he made privately in e-mails as he sold shares; the stock subsequently fell sharply as the company’s losses became known.”
http://www.nytimes.com/2011/04/14/business/14prosecute.html?pagewanted=all
So JF – we have sat down together many a night and discussed our views.
Although we differ we both want the truth or at least as close as we can get to it.
My offer – you are welcome to co-host CakeOrDemocracy – I will give you equal access –
You can post what you like, respond in to my posts – effectively write counter blogs. What sayest thou?
(JF Entry - I couldn't post as Google Account ..odd?)
ReplyDeleteDude - who are you talking to? Most of your comments have nothing to do with what I said, and the rest take a small portion of what I said and runs wild with it. I almost don't know where to begin.
I don't know why you keep bringing this point up with me, but one more time - I never said the poor didn't pay taxes. Just that they don't pay Federal Income Taxes. And no, not all taxes are created equal. There's a real difference between paying taxes just because you're a working/legal resident of the US vs. taxes you pay based on your own purchases and where you choose to live.
Being poor in of itself has no direct relationship with entering the military. You're omitting the key pieces of information in this discussion. Poor families also tend to be broken, uneducated, and provide poor (if any) role models. Kids from these families see gangs and the military as a way to belong to something, not because they think they can't afford college. You can fact check this if you want, I also have quite a bit of direct and indirect experience here.
Moving on .. again, I never linked happiness to socialism or capitalism. I was only trying to understand your mindset for the purposes of having productive debates. Clearly, you're a socialist in many ways - which just means many of your criticisms about US policies and corporate practices are not really applicable. It would be like going to an Indian Restaurant and criticizing it for it's poor Italian food.
I can't take you seriously when you start talking about the "intentions" of those involved in the financial crisis. I would have a lot more fun with that comment if it wasn't so late, but really - there's no way you can know what the intentions of these individuals were. And even if you did know, it wouldn't matter. There's a huge difference between "intentions" and "actions" (at least I hope there is...;-). But to bring this point to a close - if you know of some or any illegal action by those involved, please contact Obama immediately so he can start the investigation and prosecution. You would be a hero.
It's the same with your statement about protests in other countries being "spontaneously taken up". There's no way you can prove that if for no other reason that it's almost impossible to prove a negative.You would pretty much have to prove that no wealthy individuals or organization are involved by eliminating them all. You would also have to do the investigation yourself, otherwise how can you be sure the investigation was done thoroughly? Meaning, it's not in the best interest of the news media to prove that these protests are backed by someone or some organization because it makes for a much better story if it's run just by the "people".
“Dude - who are you talking to? Most of your comments have nothing to do with what I said, and the rest take a small portion of what I said and runs wild with it. I almost don't know where to begin.”
ReplyDeleteOh JF – you cut me to the bone…………………….
I will regurgitate your comments of October 16, 2011 3:18 AM into a summary (by the way – who is up at the ungodly hour you reply to me except criminals and madman? ;) just saying.
– You said the following (you even numbered them for me but kinda grouped things in an awkward way – so let me fix that for you)
1. The Wall Street Protest is not a people generated protest, it's backed and organized by Adbusters, a Canadian anti-capitalist group.
2. Are you sure you wouldn't be happier in a socialist society? There's nothing wrong with that - it seems to work for other countries such as Canada and Switzerland.
3. But what I don't understand is with the bottom ~50% paying 0 Federal Income taxes and the top 10% paying 70% of the Income Tax burden, how is it the wealthy are not paying their "fair share"?
4. With regard to the housing burst - No one in the financial institution did anything illegal… Bottom line is that a lot of people made a lot of decisions that caused the crash - not to forget the "home-owners" themselves that purchased houses they clearly couldn't afford - no money down, …So if you are looking to throw those responsible for the housing bust in jail, you can start with Wall Street then make you're way round Washington, and last stop is on Main Street
Canada and Switzerland are not socialist countries. They have some aspects of socialism for some services but it has a capitalistic economic system based on free enterprise (just being a stickler). Since Canada was your example I was merely pointing out that people there are happier – they just not socialist.
Okay – there are people that don’t pay federal taxes (roughly 46%) – but why?? According to the Tax Policy Center a joint venture of the Urban Institute and Brookings Institution about half of people who don’t owe income tax are off the rolls not because they take advantage of tax breaks but rather because they have low incomes. So those poor people pay do pay other taxes—federal payroll and excise taxes as well as state and local income, sales, and property taxes. I am going to look into what percentage of their income goes towards taxes. I guess when a larger percentage of your income goes towards taxes – a rose by any other name.
There are also a lot of companies and individuals who make a lot of money who don’t or at least don’t pay what they should (including the underground economy of people who work for cash). I have said the tax system is flawed but I believe if there is a point to be made it is that the lobbyist, loopholes and underground economy have much more effect than people who have low incomes. The U.S. Census Bureau’s annual 2011 poverty report, released this morning, found that 46.2 million Americans, or one in seven of us, were poor in 2010. Now I know that the definition of poor here is quite different than in portions of Africa or Afghanistan but on the other hand the definition of rich would suffer the same comparision.
So ultimately I am not sure what your point is that half of the people don’t pay taxes
So tell me how many rich kids go into the military? And by the way I love Indian food.
I can't take you seriously when you start talking about the "intentions" of those involved in the financial crisis. I would have a lot more fun with that comment if it wasn't so late, but really - there's no way you can know what the intentions of these individuals were.
This comment really gave me "agida" Intentions?????? I suggest you read my new inspired post on the 650-page report released by the Senate Subcommittee on Investigations, chaired by Democrat Carl Levin of Michigan, alongside Republican Tom Coburn of Oklahoma. “Wall Street and the Financial Crisis: Anatomy of a Financial Collapse,”
Working backward -- your other blog is too long and I'm not reading a 650 page report. But if there's really that much evidence of clear-cut illegal wrong-doing, you should write your congressman and Obama to get these people thrown in jail. I would say that the report must not be so clear-cut since no one has even been arrested yet, but I'm sure the report or someone on the left has some explanation for that. Probably involves govt. and/or corporate corruption. In any case, I don't care enough about this issue to figure out why we're even discussing it. Throw them all in jail - will that help reduce unemployment?
ReplyDeleteI never said that "wealth" = "happiness". Similarly, "overall life satisfaction" does not equate to one's view of the "greatest country in the world". Either way, the whole analysis is highly biased and not worth discussing. I"m pretty happy with the US (although I do agree with the 78% that think we're on the wrong track) and this issue just isn't important enough to continue discussing.
The only part of your response that was in the vicinity of what I was talking about was the discussion of "fair taxes". I was hoping you would give me a specific number as to what you consider "fair" rather than loosely refer to previous tax rates, but I have enough to know where your at on this topic.
To you, "fair" is only relative to what you think someone can afford to pay. It's not really based on a set percent of income. So someone making 10 Million can afford to pay +95%, someone making 1 Million can afford to pay +80% and so on. I don't think I'm putting words in your mouth, after all - you did refer on several occasions to previous tax rates of 70% for those making > $267,330 and 49% for those making > $84,173 (tax rates from 1981 adjusted for inflation to today's rates). And it's all justified so the poor can have a reasonably high quality of life without having taken the same risk and effort (and a bit of luck) as those in the upper income brackets.
My view is basically that people should be able to keep as much of their earned income as possible. It does however mean yes, if you're poor and want to move up you'll have to work harder, smarter, and take some risks. I know a lot of people (including you) that worked hard to move up from poor to dare I say - upper-middle class. I've also seen a lot of people "milk" our govt. assistance programs.
Back to the point - the difference is in my view, people have to work hard not to fail. In your system, no one would fail no matter what they do. I was just trying to reach this conclusion in my previous entries. Now that I have, you sir, can have the last word(s).
JF - i have done you a disservice. you have said in no uncertain terms what you believe. you have challenged me directly and i have not clearly articulated my beliefs as to what i believe. why we should have a progressive tax and at what levels. part of my motivation for generating this blog was to help me formulate and grow my ideas. i am about to do what i said.
ReplyDeletei will need a few days.
Occupy wall street was a great idea. How many gordon gekkos do we have now thousands. They all live in manhattan. Oh so nice one big happy family stealing everyone in the country blind.
ReplyDelete