[LinkedIn] had hired Morgan Stanley and Bank of America’s Merrill Lynch division to manage the I.P.O. process. After gauging market demand — which is what they’re paid to do — the investment bankers priced the shares at $45. The 7.84 million shares it sold raised $352 million for the company. For this, the bankers were paid 7 percent of the deal as their fee.
For a small company with less than $16 million in profits last year, $352 million in the bank sounds pretty wonderful, doesn’t it? But it really wasn’t wonderful at all. When LinkedIn’s shares started trading on the New York Stock Exchange, they opened not at $45, or anywhere near it. The opening price was $83 a share, some 84 percent higher than the I.P.O. price. By the time the clock had struck noon, the stock had vaulted to more than $120 a share, before settling down to $94.25 at the market’s close. The first-day gain was close to 110 percent.
Who was able to buy those shares at $45 and immediately turn around and sell them at $120? The rich and the powerful favored customers of Morgan Stanley and Merrill Lynch. If you had $10,000 or $20,000 you wanted to invest in a block of LinkedIn stock you would have been out of luck--those brokers won't even consider giving you access to an IPO.
They actually have rules that supposedly protect small investors with insufficient assets from participating in such offerings because they are "risky." I know this because my wife and I have been in on IPOs in the past, and we had to be vetted in order to participate. It's all about who you know and how much money you spend with the broker.
This really calls into question the purpose and even the utility of the stock market. Ostensibly stock exists in order for companies to attract investors so that they can get money to grow their business and recoup their original investment costs.
But LinkedIn didn't make anywhere near as much money as some of the people who bought their stock for $45 and immediately flipped it, some for as much as three times what they paid for it. The people who do all the actual work are getting stiffed.
Once a share is sold the company never sees another nickel from it. Too often shareholders are only interested in driving the price up so that they can sell it: they don't give a whit about what the company is doing, or whether it is really viable. Shareholders often demand CEOs do things just to raise the stock price, even though they harm the ability of the company to do its work (like the ever-popular ritual laying off the employees). They just want to cash out as soon as possible to flip the next IPO.
For that reason stock market profits should be taxed at regular rates -- not the ultra-low capital gains rate -- unless you're selling IPO stock more than a year after you bought it. Buying stock from someone who just bought it from another guy is not a real investment--it's just flipping. However, income from dividends and bond interest really are investments and should get long-term capital gains treatment.
The worst thing about the LinkedIn deal is that this kind of stock trading causes bubbles, like the tech bubble that burst in the late nineties. Is LinkedIn stock worth anywhere near $94 or $120 a share? Of course not. Just like Yahoo was never worth what people paid for it, and most of the other tech stocks that traders ran the price up on in order to flip them. Google is another stock that's overvalued, but Google at least has some substance behind all the hype: its search engine business is legit and the Android operating system has become the foundation for millions of cell phones and tablets.
These days the bulk of stock trades are made by computers that make decisions based on minuscule fluctuations on the scale of microseconds. This computer trading was the cause of last year's flash crash.
Computer trading has a lot in common with the "quantitative analysis" that brought us the credit default swaps and other crazy investment vehicles that tanked the economy in 2008. These schemes use mathematics and computer programming to take responsibility, human decision making and common sense out of the equation in order to make money ever faster out of thin air.
That's why a transaction fee should be levied on every stock trade. Republicans in Congress are complaining about high taxes and are threatening to cut funding to the very regulatory agencies that should have stopped the banks' foolhardy investment vehicles. These agencies were already understaffed during the Bush administration; cutting back on them now would be a colossal error.
A transaction fee would be the best way to put the expense of regulation on the companies that are most likely to cause the next crash, as well as put a damper on the riskiest and most egregious financial transactions.
High-speed computer trading has the potential to bring the entire world economy crashing down in an outright depression. This is one technological innovation best nipped in the bud before it gets out of control.
95 comments:
This post seems an unfortunate muddling of fact, insight, innuendo, and falsehood.
To say that only the "rich and the powerful favored customers of Morgan Stanley and Merrill Lynch" got access is perhaps partially true. As your anecdote suggets, I'm sure customers with limited funds were turned away. I have never been a customer of Morgan Stanley prior to this IPO, yet I was allowed to participate. Perhaps I qualify as rich, perhaps not. But I can hardly qualify as having connections, which is insinuated in your next paragraph.
"Ostensibly stock exists in order for companies to attract investors so that they can get money to grow their business and recoup their original investment costs"
A partial truth. But certainly another primary function of stocks is to offer a way for investors to receive a return on their investment. Correct? Why would one want to help capitalize a company if they can expect nothing in return?
"The people who do all the actual work are getting stiffed."
What does that even mean?
"Once a share is sold the company never sees another nickel from it"
That's completely inaccurate, and in fact is contradicted by your prior (correct) statement that stock exists to allow business to get money to grow their business.
"For that reason stock market profits should be taxed at regular rates"
A blurring of fact and innuendo. Those who have flipped [your term] the stock for a return of 3 times the investment are subject to ordinary income rates on their short term capital gain. Favored long term capital gain rates do not apply until the asset is held for at least 1 year.
"Is LinkedIn stock worth anywhere near $94 or $120 a share? Of course not."
I disagree. That's why perhaps it is best that you were kept out of the IPO.
"That's why a transaction fee should be levied on every stock trade"
It's a thought that merits examination. I agree with you that completely unfettered automated decision making is not acceptable. In reality that is not what exists today, but it is entirely possible that the checks currently in place are not sufficient. The tradeoff, of course, is that all stock growth can be expected to slow, whiel smaller investors will further be discouraged from participation in the market, if not entirely excluded. So is it possible the unintended consequences are too high? (Talk about a market crash...how about implementing a policy that discourages people from buying stock!)
Nice catch on the glaring contradiction nikto made.
Man, Nikto... that has to suck to write this lengthy screed and then have it destroyed by the first response.
But do any of these counter-arguments mean you have changed your mind?
Oh, and google search
inherited vs earned wealth
So you can be more informed on that topic.
Besides, do you have to break down the class warfare into those that deserve wealth and those who don't? (in your opinion, of course)
Can't you just hate all the wealthy to make it easier?
They actually have rules that supposedly protect small investors with insufficient assets from participating in such offerings because they are "risky."
They? Who do you mean by they?
Oh, perhaps you mean the government of the United States?
I thought you were all about the govt is "us" - but here it seems to be "them". M you have one of those anti-govt extremists as a co-blogger.
Curious.
Man, Nikto... that has to suck to write this lengthy screed and then have it destroyed by the first response.
Yea! You guys win and Nikto loses. Congratulations you are now a champion of...a comments section on a blog? Whoopee! What a cool world you guys live in.
Yea! You guys win and Nikto loses. Congratulations you are now a champion of...a comments section on a blog? Whoopee! What a cool world you guys live in.
Oh, I see. When we see someone indoctrinating everyone around him with a load of horseshit, we should all be quiet and let him, right?
Oops, unless it's a Republican or conservative, then it should be shouted from the housetops and twisted to make it even worse than it actually is. I forgot, that appears to be a vital point to all you folks.
So being spectacularly wrong about something is all about winning?
Shades of Charlie Sheen!
Indoctrinating everyone around him? Wow. Into what exactly?
*sniff sniff*
Yeah, I thought I smelled a Bircher in here. I guess being critical of unfair, unethical and sometimes illegal business practices makes you a communist in the land of true believers.
Investor, if you disagree with statements that Nikto made, let's see them backed up with sources and facts. Making a statement doesn't mean he's wrong and you're right. Having a group of sycophants cheering you on doesn't make you accurate either.
Hi Markadelpha,
Thanks for your response and for pointing out the lack of clarity in my first response. I am happy to clarify the facts which refuted multiple points from Nikto's post. But because I work for corporate America and consequently I use acronyms all day I am going to use some acronyms here simply for the sake of brevity.
CPFBN = Contention Put Forth By Nikto
IFWRTC = Investor's Fact Which Refutes The Contention
CPFBN - only the rich and the powerful favored customers of Morgan Stanley and Merrill Lynch got access to the IPO in question
IFWRTC - I got access to the IPO, and never having been a previous customer of Morgan Stanley I can hardly be considered a favored customer. Therefore, at best, this contention is only partially true.
CPFBN - Once a share is sold the company never sees another nickel from it
IFWRTC - The definition of Market Capitalization should be enough. Since you are fond of wikipedia I provided that link as a reference.
CPFBN - For that reason stock market profits should be taxed at regular rates
IFWRTC - Short term profits, which are exactly the kind described by Nikto using his "flippers" anecdote, in fact are taxed as ordinary income. I refer you to IRS Schedule D.
CPFBN - Is LinkedIn stock worth anywhere near $94 or $120 a share? Of course not
IFWRTC - There is no fact that can refute this factoid. Only time will tell. I would simply offer that a stock is worth what people are willing to pay for it - no more, no less. So to say that it is not worth what investors are willing to pay for it doesn't make a great deal of sense.
Everything else I included in my original response is opinion.
I hope that helps alleviate your concern.
Dastardly, I appreciate your acknowlegement that Nikto's screed was successfully opposed.
Now I'd like to say that Obama is actually the Anti-Christ, with "666" tattooed on his arm.
And if you prove me wrong, it is only so you can be the champion of a blog. Whoopee.
It's time like this that I wish Nikto would respond more often in comments. Ah well...:(
Hi M, I don't need a link since you already talked all about qualified investors - and the Federal govt is the they to which Nikto referred (with the rule about protecting small, possibly stupid investors).
Hope that clears that up for you.
Oh, and about that meme that only large avaricious corporations want "unregulated" markets - it appears a whole bunch of community banks are concerned about too much regulation.
I'm finding it hilarious that, time after time, subject after subject, the "True Believers" will present facts, documentation, and clear, concise logic, and be dismissed out of hand because they are just "True Believers"...
...but the Teacher, the "reality based community", the "critical thinkers"... all they have to do (indeed all they seem capable of doing) is keep repeating the words "childish dishonesty" like a mantra, and think those who disagree with them will stop disagreeing, or their disagreements won't matter, or perhaps they'll cease to exist entirely.
It's magic!
I do find it interesting that everyone is very focused on the items Investor disagreed with and not the ones with which he agreed. And somehow his/her opinion (which s/he is kind enough to note) is now gospel. It's a good thing you guys told me that you don't simply want to win the argument because I never would've known otherwise:)
Actually, Mark, let's see if any of these posters are the critical thinkers they say they are. Comment critically on Investor's post. How is he accurate? How is he not accurate? Why? What other perspective could this be looked at other than Nikto's and Investor's?
Why don't YOU do that Santa?
Oh, because you've never actually posted anything worth the electrons.
You are missing your chance to refute all those statements you find misleading or non-factual.
Well neither one of you could refute Investors points, and you haven't told us who you believe. Way to take a stand.
Nikto won't respond because it may involve addressing the glaring contradiction in his post.
Santa, why are you tasking others to comment critically when you won't?
I want someone to refute my contention about who the evil they are in nikto's idiotic screed.
Oh, there, I said something a little mean - I guess all the good, kind-hearted lefties (seething with repressed anger) must now ignore the actual point I was making (which is convenient since they can't say anything intelligent about it anyway).
Y'all recall that South Park episode about the Mormon church? You Leftboro believers remind me of that... a lot... "dumb dumb dumb dumb dumb"!
so someone has to comment critically on investors post in order to demonstrate critical thinking to you santa? youre a complete idiot. why dont you put down your perspective instead of cheerleading for markadelphia. you obviously dont know enough about the topic to do that.
Thanks everyone for helping me out with a little theory I had. By making the request that I did I wanted to see if two things would happen. First, I was certain that you would refuse. Second, I was certain that you would then point the finger at me and wonder why I haven't made any critical comments about Investor's post.
I didn't want to make the either accusation until I had the evidence but here it is for all to see. Does anyone else that reads comments think that these guys are capable of anything other than childish taunting, personal insults, and avoidance?
Agreed, Santa. They are not capable of anything else.
Yep, I agree Santa. I think Mark said something about this a while back but it's basically why I don't post as much anymore and just read posts and a few of the comments. I could waste an hour or two researching Investor's counter claims only to find that he is wrong about what he is saying. Anything I put up would be soundly derided as an "idiotic screed" and nothing would come from it. Personal attacks would follow in what is surely the vain hope that they somehow "win." Basically, unless it jibes with your catechisms, you people aren't interested in an honest and critical discussion. That and the fact that you are completely wrong about so many things makes it so hard to give any serious thought to anything you are saying.
I agree, Santa.
Sorry folks. Just cleaned out the spam filter so that's why all these are bunched together.
Yes, downtown, don't waste your time. That's something I learned a long time ago although I do think that Investor did make some fair points. I'm still finding it amusing that all of you have ignored the agreement between Investor and Nikto. And isn't it a genetic fallacy (or something like it) to say that if Nikto is partially wrong about one or two of his statements that he is wrong about everything?
I suppose it's not surprising considering what so clearly drives each of you.
@downtown
I do not appreciate being included in a blanket grouping of those you deem incapable of engaging in an honest and critical discussion. If you truly can spend an hour or two refuting any facts that I have presented then I look forward to you doing so. I suspect you will fail in that endeavor since the facts are solid, but if do succeed then I will welcome being corrected. I would only deride something as idiotic screed if it were, in fact, truly that and worthy of being called that.
To wit, your categorization of everybody with an opposing viewpoint as "you people" is idiotic screed.
@Markadelphia
Speaking only for myself, I find no reason not to further elaborate on the items about which Nikto raises valid questions or points. Contrary to your insinuation, the purpose of my original response was not to win an argument, but rather to call attention to what were some glaring inaccuracies and inconsistencies. Would you not agree that it is difficult to engage in an honest and critical discussion if the very foundation for the discussion were flawed? Filled with half-truths and innuendo?
I don't know why you lament the lack of response from Nikto. Personally, I welcome your insight on the subject.
You've again placed yourself in somebody elses head and have figured out their motivations. Whenever that happens, whoever you are talking about usually doesn't come out looking very good.
One thing I've noticed - Investor and Juris are the only ones who commented on the subject at hand and addressed Nikto's post. Literally everyone else (last 5 posts, rld, sw) commented on the comments.
Don't bother pointing out who is interested in discussion and who isn't - it's on display.
I'd love to know who on here favors a transaction fee on every stock trade and who doesn't favor it, followed by their reasoning behind their answer. That's not managing fantasies, that's asking 1 question about the topic at hand.
have ignored the agreement between Investor and Nikto
What agreement Mark?
The part where Investor says Nikto is partially right but has an error of omission which changes the point Nikto was making?
Or the part where Investor thinks one of Nikto's ideas (not his facts, but his conclusion) merits further examination. But upon a quick brainstorming brings up several points that should make the idea unpalatable to you (i.e. how the rich fuck us over)?
Good one Santa! You must be performing the same scientific experiment every time you post a comment. You don't add anything to the discussion, but insist everyone else is against you.
You must be one of those right-wing John Bircher paranoids Mark is talking about.
Allow me to paraphrase Mark's last comment.
Investor raises some good points, Downtown. Don't bother wasting your time with them. That way, we can continue to say Republicans are bad!
Last:
As an ill-informed poster, I favor a fractional tax on shares traded.
What?!? I consider myself a conservative?!?!
Yes.
The market is currently an illusion driven by computerized high-frequency trading. (HFT)
When entities such as JP Morgan and Goldman-Sachs can have 30 days in a row without a losing trade, there is clearly a flaw in the system somewhere.
Neither Joe Sixpack, nor Bill Gates needs HFT as an individual investor.
Here's an article from a couple years ago that I offer in support of my position:
http://seekingalpha.com/article/151173-hft-the-high-frequency-trading-scam
The Brazilian dollar question is:
Will the law of unintended consequences pop up here?
Will a per-share-tax actually solve the HFT problem, or just push the bubble somewhere else?
Investor and Juris are the only ones who commented on the subject at hand and addressed Nikto's post
Yeah, that's a common problem around here and I sure wish it would change. But since I allow anyone to say anything they want (minus weird spam) I'm not sure it will ever be any different.
Investor, I don't think there is any need to respond any more than what you said. Again, I think you made some fair points. It does frustrate me, though, that Nikto won't respond or engage people much here in comments. That is his choice as he sees it largely a waste of time since he doesn't think he will every change anyone's mind.
To a certain extent, I agree with him. I could research your points and find out a great deal but would it change anything if presented you with facts that disproved what you say? I don't think so. That's profoundly sad, in a way, but that's the cynical side of me. I've wasted too much time on research only to be personally attacked and have the conversation go absolutely nowhere because I can't get by dogma.
Honestly, there's no way any of us can know if you were actually allowed to take part in the IPO, for example, but I have no problem taking you at your word. This isn't a provable fact, however.
Damn. Santa, sasquatch, downtown - all just proved my little theory: that they can't offer an intelligent comment. But they sure do respond to snark - like a trout to PowerBait.
That is his choice as he sees it largely a waste of time since he doesn't think he will every change anyone's mind.
If all you intend to do is preach, then I can buy that argument. I don't mind if that is what you do, so long as you are honest about it - as opposed to saying you arguing based on facts, logic, etc.
@Markadelphia
It is discouraging to read that you would call into question the validity of a poster's contention. Perhaps that is just the consequence of a cynical nature. Or perhaps it calls into question the validity of your contention that you truly wish to engage in an open and honest discussion. Your words were ...I have no problem with... and yet the majority of that paragraph described the ways in which you do, in fact, have a problem with accepting my claim.
It's a simple claim. Perhaps if I claimed I was frontman for a major rock group, or married to a supermodel, or something ridiculous like that then I would understand your skepticism. [For the record, I make no such claims...] It is disappointing that such a banal claim would be accepted with such obvious reservations.
As a reflective individual, ask yourself this: If Investor produced a Morgan Stanely statement confirming the purchase of a position in the IPO would you accept that as proof? Or would you and those of like mind on your blog reject it as a likely forgery? After all, it would be quite easy to fabricate such a statement, would it not? If we met at a pub and I produced a satchelful of stock certificates would you accept that as proof? Or would you point out that those certificates could, in fact, have been purchased after the IPO? If I a produced a bank statement that showed a transaction transferring money to Morgan Stanley on the same date for the same amount as the amount I claimed I invested in the IPO, would you accept that as proof? Or would you claim that proves only that I transferred money and does not prove the purpose of the transfer?
In my opinion one can cannot truly engage in an open and honest discussion unless one stops accepting* people's contentions and instead starts accepting them.
(I trust the meaning of the asterisk is clear...)
@Markadelphia,
I also want to ask if an inference I am making from your last reply is correct. I read your reply to suggest that if you research claims that I make you will find those claims to be incorrect. Is that a valid interpretation of what you said? Perhaps not. If not, then my apologies. No slight was intended. Perhaps my own cynicism is showing. But notice that I have claimed no political allegiance and I have no made no claim regarding the accuracy of the entirety of Nikto's original posting, and yet it appears to have become a question of who's right. Is Notes From the Front so black and white that somebody must be right and somebody else must be wrong?
@Last in Line
I wish to answer your request for a stance on the proposition of "a transaction fee on every stock trade" but I would need to better understand details of the proposal. Is it really "every" stock trade? Is it a flat fee or a sliding fee? Are stocks the only holding in scope? Those sorts of details.
As I mentioned earlier, I think it is an idea worth discussing, but in the most general terms I am opposed to the idea.
Juris, c'mon, be fair. You do the same thing. Plus you call me a fucking idiot or some other personal attack all the time. Jeez...
Investor, I don't call into question that you got the IPO. I take you at your word. That's what I said above. What I am saying is that there is no way to prove this as fact because this is an anonymous blog. Now, I know Nikto personally and the things that he is saying did happen to him. This is why I wish he would defend himself more because he has nearly 30 years of experience in corporate America.
It is my cynical nature. I'd love to engage more on this blog. I'm not sure if you came here by way of Kevin's blog or not but my experience there really sullied how I debate on here. That's MY fault, not yours. I want to be clear on that one.
Please do not put a Morgan Stanley statement on here. This is an anonymous blog and I want to keep it that way. I've had a few threats over the years and really don't want any of my readers getting threatened either.
I'm not sure if I would find your claims to be correct or incorrect. What I am saying is that, in the past, I have gotten into long debates in which I have done a ton of research only to hit the brick wall of dogma and, thus, have completely wasted my time. An example of this was the "Bush Era tax cuts increased revenue" debate which went on for over 500 comments on Kevin's site. I produced fact after fact only to be ignored, insulted personally, and childishly bullied. Similar things have happened here (Social Security is a Ponzi Scheme). For evidence of this, watch what happens now that I have mentioned both of these incidents.
The other side of all of this is that I put up most of the posts on here and would rather spend more time researching my latest column. But I'll tell you what...stick around...continue to make thoughtful comments as you did above and I will endeavor to find the time to respond specifically to your points. If I have the time this weekend, I might be able to take a look at your market capitalization point.
...in the past, I have gotten into long debates in which I have done a ton of research only to hit the brick wall of dogma and, thus, have completely wasted my time. An example of this was the "Bush Era tax cuts increased revenue" debate which went on for over 500 comments on Kevin's site. I produced fact after fact only to be ignored, insulted personally, and childishly bullied. Similar things have happened here (Social Security is a Ponzi Scheme).
Are you claiming that those who disagree with you produced no facts? Or that your facts are "facts", but the facts of those who disagree are "dogma"? Would you please define your standard for distinguishing between the two?
As for being personally insulted, you have personally claimed racism, hatred or idiocy in those who disagree with you without a single shred of supporting evidence many, many times. Is it your contention that such things do not qualify as personal insults and bullying, or do you merely contend that turnabout is not, in fact, fair play?
...in which I have done a ton of research only to hit the brick wall of dogma and, thus, have completely wasted my time.
I feel certain many of the commenters who disagree with you have felt exactly the same way as regards your responses. Should they then stop "wasting their time" supporting their positions with facts and simply dismiss you as a racist and an idiot? You seem to be saying that's an acceptable response when you do it, no?
Please understand, none of the above is meant to be insulting. It is merely intended to illustrate that 1) there are two sides to every story and 2), point out that it is unrealistic to expect things from others that you decline to do yourself. Whether your reasons for declining to do those things is valid or not is beside the point, others' reasons are just as likely to be valid as your own, are they not?
Well since santa, downtown, sasquatch and serial made the choice to leave the room when someone asked them 1 question about the topic at hand, and Mark still hasn't said if he would support the proposal Nikto put forward...Investor - it's not my proposal, but from what Nikto put down, it's every stock trade...kind of like $7 a trade on Etrade. At least that's what I think he was talking about. You are correct in that the unintended consequences would take over as the big banks can cover those fees quite easily by passing them on to their customer in one form or another. Average investors won't have that option. That's a funny way of supporting the little guy.
Are you claiming that those who disagree with you produced no facts?
It depended on the situation but regarding the Bush tax cuts and the whole Ponzi insanity, the facts that were presented were either disingenuous or insanely myopic. No one has ownership to facts and the ones I presented were largely ignored or laughed at because they didn't fit into the desired result-winning the argument. It was a very childish discussion as most sadly are on blogs.
Here's the difference between me and some of those people with whom I debated. I can't deny that Hardings massive deregulation worked during the time he used it. It's not part of my overall ideology but I still have to accept it because of the results. Another fact that is sadly true is that Democrats have a far longer history of racism than Republicans. This is an indisputable fact. I don't like it but it's true. President Wilson, for example, rolled back many of the reforms Republicans made at the turn of the century because he viewed black people as inferior.
Now, Social Security also has worked and has been a very effective social program particularly in reducing poverty in the elderly. Yet, accepting this fact is anathema to people who believe in smaller government. Social programs can never work because they don't fit the ideology. Instead of being honest about it and accepting its effectiveness, they say silly things about it. Regarding current trends of racism, they refuse to admit the outcome of Nixon's southern strategy and note that there is a fairly prevalent bias in the GOP...much more so than the Democratic Party.
In all honesty, I'm a very open minded person. It's not dogma they are running into with me. If you are a laissez faire kind of person, show me how the outcomes of the last 30 years prove this ideology to be valid. It may work in micro cases as was the situation with Harding but not at a macro level. Defenders of super free markets seem to shake off the simple facts of what these guys did to our economy. Instead, they blame the government. It's simply inaccurate to say this..as in, not factual regarding ALL available data.
Show me how tax cuts produce revenue because all the evidence I see shows the opposite. I was pretty open minded about Laffer, for example, and said that it is a valid theory if one is talking about corporate taxes or countries with very high tax rates. For the most part, though, the evidence that I was shown was ridiculous, narrow in scope, and suffering severely from confirmation bias. In other words, not critical thinking whatsoever and a single minded goal: less taxes, less government is always better. When you start from that fallacy, where else can you go?
If you still aren't convinced, recall what happened when I agreed with what was posted. Or if I said something with which someone else agreed. All peas and carrots, right? As soon I disagreed or said something they didn't like, I was a Marxist. Every argument I made was dissected into minutia and riddled with personal insults and childish bullying. It still happens here. I'm well aware that is the goal, though, and have largely stopped engaging as it steers us away from serious analysis of the topics I bring up. To a certain degree, that is the general theme of your comment, no? But since we have a new and seemingly honest poster who wants to engage (investor), I thought I'd illustrate further my hesitation.
I can't deny that Hardings massive deregulation worked during the time he used it.
What are you talking about? Are you claiming there was tight banking & securities regulations prior to the Depression that the Harding Admin (and Congress of the time) removed?
Now, Social Security also has worked and has been a very effective social program particularly in reducing poverty in the elderly.
So why are you so hesitant to remove Buffett (and anyone else who isn't at risk of poverty) from eligibility? Wouldn't that enhance the effect of SS in keeping the elderly from poverty - by focusing the program on that goal?
And if there is one ounce of truth about wanting honest, open dialog - please answer these questions.
I don't recall saying that Buffett should not be removed from eligibility. Does that mean he shouldn't pay in it all either? I do agree that the fund could be greatly aided if those that did not need the money would not draw any out. There are number of scenarios like this in which restructuring how it works would be beneficial to the overall health of the program.
Regarding Harding, I'm talking about Woods' very valid argument that the Depression/Recession of 1920-21 was remedied by laissez faire policies. Harding slashed the budget and cut taxes. There was no need for a stimulus because the problem was not due to inadequate consumer spending. His policies worked because they were specifically good for the time.
Last, in regards to your question on transaction fees, I've been dithering with a post over the last few weeks on some recent events with Wells Fargo so I think I'm going to hunker down and finish it. That way we can have an entire post devoted specifically to your question. I'll also address the issue of taxation and what the rates should be. Maybe we will get a response out of Nikto on that one!
Harding slashed the budget and cut taxes.
How does that equate to "massive deregulation"? I'm just curious.
His policies worked because they were specifically good for the time.
So how exactly is the govt supposed to know when "leave it alone" is appropriate (since you agree that did work) and when intervention (either small or massive) is required? Remember, you must be able to determine this at the time and not just judging based on history.
I don't recall saying that Buffett should not be removed from eligibility. Does that mean he shouldn't pay in it all either?
You specifically said he should voluntarily give up his claim in response to my suggestion that means-testing would take him off the rolls. As to paying in, I doubt that he's paid in all that much, since SS is collected against wages and not all income. Given that benefits eligibility is not tied to contributions, this isn't a problem. You seem to be very hesitant to agree that means-testing would be good; is that because a liberal hasn't suggested or endorsed it?
And now you have a fine example of an honest, open discussion. Questions posed politely and positions considered in reponse. We are both capable of this, it only takes a little effort.
Well, if I did say that about Buffet then it was short sighted of me. Given your parameters, I would go along with means testing as a way to help SS.
Back to Harding, since the problem wasn't due to lack of consumer spending, they knew that a hands off approach would work better. They knew this at the time, as you say, just like they knew today that this approach wouldn't work given the different complexities.
Back to Harding, since the problem wasn't due to lack of consumer spending, they knew that a hands off approach would work better.
Given that was pre-Keynes (General Theory in particular), I think you are giving credit not really deserved (or necessary). I would be more inclined to imagine they just viewed it as another periodic 'panic' (term of art back in the day).
I'm still a bit curious as to why you initially described that as "massive deregulation".
...either disingenuous or insanely myopic.
...because they didn't fit into the desired result-winning the argument.
...ridiculous, narrow in scope, and suffering severely from confirmation bias.
Those are your opinions. Certainly you have a right to whatever opinions you like, but that doesn't make them uncontestable facts. Even if we stipulate that those opinions are correct, that doesn't cause them to magically morph into facts. I think it's probably very safe to say that many who disagree with you hold similar opinions concerning your arguments.
So what makes your opinions any more valid than theirs?
No one has ownership to facts and the ones I presented were largely ignored or laughed at...
You have shown yourself not to be at all bashful about ignoring, belittling, dismissing or laughing at facts that, in your opinion, are disingenuous or simply irrelevant to the discussion at hand (the global warming debate and the Social Security debate provide plenty of examples. For that matter, so does the response I took these quotes from.) Should those who disagree with you not be allowed the same methods you use? If not, why not? If so, why do you object?
Anonymous, we're sliding into the game playing territory again. I've given you two very clear examples of the difference between me and those folks who I have debated who engage in childish dishonesty. You did not respond to them. Oh well. No big deal for me, really. I've already answered your questions and refuse to engage in the same obsessive hyper scrutiny of me that typified those discussions.
If you'd like to have an honest and critical discussion about Social Security and climate change, no problem. For the latter, that means an unbiased examination of the facts. So we don't begin with "It's a liberal plot" or "It's a doomsday, religious cult filled with junk science." We begin objectively.
The same is true for Social Security. We don't start with "It's like a Ponzi Scheme" which is very clearly intended to lead one to a specific conclusion. We start with the facts which include that it reduced poverty in the elderly by 40 percent since its inception.
>We begin objectively.
Dear god. You are so far from this ideal that it isn't even funny that you'd try to claim it. Drop the pretense preacher. You're only fooling your sycophants.
>We start with the facts which include that it reduced poverty in the elderly by 40 percent since its inception.
Is the fact that it is currently outputting more money than it is taking in a relevant fact, in your opinion? Or is that one you'd just rather ignore? It is of course telling that the (source please?) fact that you'd like to start from is the benefits of a program, rather than its costs. Guess what - if we increase taxes by 10% more on everyone, and give all that extra money to old folks, chances are, they will be less likely to be under the poverty line! If we ignore the increased taxes, that sounds totally awesome! Other amazing things: If you give a bunch of money to a corporation that is about to go through some significant pain, that corp can probably avoid that pain. For awhile.
>which is very clearly intended to lead one to a specific conclusion.
And out of curiosity - when you compare Republicans to facists, are you trying to lead one to a specific conclusion? Or are you just, you know, asking questions?
Hmmmmm.... I am a voter. At this moment, I believe I can convince the majority to give me a good deal. Hmmmmm, I should keep voting for that...
You've got to hand it to the "Greatest Generation". They fucked the next generation just about as hard as they could.
And I'm the gun-clinger that has a vote no matter what. 7.62 is a vote for the other guy.
You can't win, kids.
Regarding current trends of racism, they refuse to admit the outcome of Nixon's southern strategy and note that there is a fairly prevalent bias in the GOP...much more so than the Democratic Party.
Stipulating that as true,
1) That was nearly 40 years ago, in other words half the people who became Republicans as a result of "Nixon's southern strategy" are now dead, a fact you seem very comfortable ignoring.
2) That doesn't translate to blanket justification to accuse anyone you please of racism just because they disagree with Obama, which is something you do on a regular basis.
3) Since you personally had no quibbles with the blatant racism of your favorite comedian bemoaning Obama "not being a real black President" for failing to keep a gun in his pants, in other words for failing to spell "black" with a double "g", I would suggest that you personally are quite obviously incapable of objective analysis on the subject. You have made it blindingly obvious that you wouldn't recognize racism in a liberal if it jumped on your face and started to wiggle, so accusations of open partisan hackery and denial of your own party's racism is no more than you should expect when you casually throw around such accusations.
Anonymous, we're sliding into the game playing territory again. I've given you two very clear examples of the difference between me and those folks who I have debated who engage in childish dishonesty. You did not respond to them. Oh well. No big deal for me, really. I've already answered your questions and refuse to engage in the same obsessive hyper scrutiny of me that typified those discussions.
In other words you reserve the right to continue engaging in your own childish dishonesty. You refuse to concede that your opinions are merely opinions, no more valid than those of your opponents. Your opinions are "facts", those of your opponents are "lies".
And doubtless you still wonder why commenters at TSM find attempting to engage with you as unprofitable as you do with them. For someone who is "a very open minded person", you are a remarkably closed minded bigot.
We start with the facts which include that it reduced poverty in the elderly by 40 percent since its inception.
Oh okay, I think I get it now. You're defining "Ponzi scheme" solely by emotional context, and the actual financial mechanics have nothing to do with your definition. In short, it's not a Ponzi scheme because none of the beneficiaries have lost money yet. (Of course, if it does fail and people lose money, we all know you'll consider it the Republicans' fault regardless of who does what.) Whether or not the precise same mechanism would be illegal if anyone except a government was doing it is completely beside the point, because people are happy with the result.
It's just like your opinion of immigration reform, or global warming, or auto company bailouts. The law doesn't matter, only the happy ending (for those you care about, anyway) matters.
This is a consistent trend with you. You are foursquare against the rule of law, you want despotism, as long as you personally approve of the despot.
For the first time, your positions actually make a kind of sense. I still don't agree with them, but at least they make a kind of sense.
Hap, I am more objective on these issues than you are. Look at this way. I am a results guy. If I see our society would take care of the elderly without Social Security in the same way with the same (or improved) results, great! If I saw demonstrable evidence that social programs are all failures and that our culture would be better off without them, fantastic!
Basically, I don't care how get to the point of being able to help out the less fortunate, the sick, and the elderly...I just want to make it there. This is in contrast to the manner in which you go about looking at problems of social cohesion. You look at the mechanism (in this case the government) and fault it as you do with mostly everything the government does. You magnify the problems that social programs have to prove that the delivery mechanism is faulty because that mechanism is anathema to you. Sadly, you ignore how to most effectively achieve the results which, for right now, is the government.
I don't have any problem discussing the problems of all social programs. There are plenty. YOU have a problem discussing the positive outcomes of these programs as do some of the other posters here who don't like the success of those who don't fall in line with their ideology.
I've posted the stats that back up my statement about poverty reduction in the elderly several times in comments. I'm sure you can take a few seconds to confirm that I am correct.
Republicans and conservatives can't be fascists because they loathe state power, right? So, my comparison is supposed to be reflective. Why do they employ those same tactics like the Big Lie?
Anonymous, the southern strategy is still going on today. I simply meant it was an extension of a very successful policy. If you prefer, you can now call it "Otherism." Nearly all on the right employ this tactic with the left. They aren't really American...Christian...blah blah blah...this is all rooted in bigotry and racism. For a much longer period of time, this is how the southern Democrats operated. Now, the Republicans do it and have those ex-Dixiecrat votes that are, in fact, multi generational.
I don't think that everyone who disagrees with President Obama is racist. I do think that if you say that 30 million people disagree with Obama and then took out the racists, you'd be left with a considerably smaller group. 10 million? There's no way to be certain. Recall the study I put up a while back on the Tea Party and race. I think that said a lot. By and large, though, when we talk about race and our president there's an awful lot of game playing and make believe on your side of the aisle. What happened to taking responsibility? Isn't that what you guys are all about? I have no problem admitting that Democrats have a much longer and abundant history of racism. It's a fact. Now, deal with your unpleasant facts and perhaps we can move forward more on this issue.
you want despotism, as long as you personally approve of the despot
Not true. Remember this post?
http://markadelphia.blogspot.com/2011/04/what-i-would-do.html
Nice try on the caricature painting that you guys always do with the left but it's not going to cut it here. Next....
No I didn't remember it, but I don't see what difference it makes. You can say it easily enough in general, but when it comes down to specifics:
You don't care whether people obey tax laws or not, as long as you get the results you want.
You don't care whether people obey bankruptcy laws or not, as long as you get the results you want.
You don't care whether people obey immigration laws or not, as long as you get the results you want.
You don't care whether people obey banking laws or not, as long as you get the results you want.
You don't care whether people obey fraud laws or not, as long as you get the results you want.
You don't care whether global warming research satisfies the standards of actual science or not, as long as you get the results you want.
You are on record right here on your own blog with all of the above opinions, in some cases several times. "Despotism", in case you don't know, is where the ruler(s) are not subject to any rules themselves, but can do whatever they please to get the results they desire. My guess is that you are doing the same thing you did with "Ponzi scheme", defining it by emotional impact rather than by what it is and what it does.
If you don't think it's "despotism" when you think the ruling class should be allowed to ignore whatever rules or laws they find inconvenient, what do you think it is?
Not to mention that you are probably the last person on Earth with any right to bitch about drawing caricatures (See: Dozens if not hundreds of references to "boiling pit of sewage" which so far as I know no one except you has ever said, among several other examples.)
>Republicans and conservatives can't be fascists because they loathe state power, right? So, my comparison is supposed to be reflective. Why do they employ those same tactics like the Big Lie?
You're missing the point Mark. I'm pointing out that its very obviously hypocritical for you to on one hand bemoan the comparison of Social Security to Ponzi schemes because it is "leading one to a certain conclusion", and yet be quite alright with comparing conservatives and facists. It's a lost cause, I know, but I'm trying to get you to examine the bias that leads you to dismiss certain comparisons that you don't like because they have an icky "smear" feel to them, but then engage in comparisons you do like and ignore the "smear." It's a learning moment for you Mark. As usual.
>Basically, I don't care how get to the point of being able to help out the less fortunate, the sick, and the elderly...I just want to make it there.
Well, that gets down to the crux of it, doesn't it? You are a "results" guy - you don't care how much it costs, how many side effects something has, how many bad incentives it creates, how much moral hazard it creates - as long as you perceive something to be addressing a problem you care about, you are happy. Well, that does put us on quite different thought planes. Let me ask you something Mark - if you could enact a new auto regulation that would add $0.10 to the cost of every car sold in the US, but would save one extra life a year, would you do it? What if it was $1? $10? $100? Is there any limit to how high you'd go to save that one life? In other words, what is it worth to you to save a life?
>You look at the mechanism (in this case the government) and fault it as you do with mostly everything the government does. You magnify the problems that social programs have to prove that the delivery mechanism is faulty because that mechanism is anathema to you.
This may sound crrraaazy, but I look at the mechanism because the mechanism is failing, which is not surprising because pay-as-you-go mechanisms tend to have structural problems. For those of us who inhabit reality, it's not very hard to note that bad design generally leads to failure. So golly gosh darn, we talk about what is broken in the design! How weird is that!
It's not hypocritical, Hap, because one comparison is valid and the other one is not. The purpose of saying that SS is like a Ponzi scheme is to paint it as criminal. It's not rooted in any sort of fact given what the words mean. Yet the right does employ similar tactics to the brown shirts of the 1930s. How is this not a fact? Turn on Fox News or read WorldNet Daily and you will see many examples. The former is a lie while the latter is based on observation. If the right stops behaving this way, I will stop making the comparison. In fact, saying that SS is a Ponzi Scheme is an example of these type of tactics! How ironic...
Now, if you were drawing a comparison between micro managers and many on the left, you'd be accurate. Or if you said that the far left wanted to sing silly love songs as foreign policy initiatives that would also be accurate. How about the WTO protesters who cry for freedom and then rip NGOs trying to achieve it? It's the same sort of silly hypocrisy with the right who hates state power but wants everyone to think and act like they do...demonizing all who don't just like the Nazis did. How about the self righteous left and their incredibly silly views regarding socialism? Or how they are hypocritical when they rally for climate change initiatives and drive SUVs? Here's a good one....many on the left want clean energy but have a shit fit about nuclear power. Huh? So, many choices here that are equal to what I am saying in regards to brown shirts and the current form of the right.
I think you misunderstood what I was saying about results. If libertarian policies achieve the desired results, then let's employ them. Gun laws, for example, are looser than they have ever been and violent crime has continued to go down. We should continue to loosen gun laws. Makes sense, right? Although, I've never been a gun control guy because guns aren't really the problem (people are) but I think you get my point.
In regards to your questions, I'd need more information. Does the one life saved ruin someone else's life? Is the market for autos elastic or inelastic? Would the tax actually end up hurting the ordinary workers and the burden be on both suppliers and buyers? All taxes aren't bad, of course, but we'd have to look at a the wider range of consequences before I could answer such a question.
In the case of Social Security and Medicare, these programs have brought an enormous amount of benefit to a great number of people. They work, Hap, largely because welfare capitalism (our current system) works...that is as long as we don't allow criminals to commit fraud. Moreover, most of the country realizes the effectiveness of these programs and others like them. Certainly, there are adjustments that need to be made as our country's demographics change but they are not failures. More importantly, we would not be discussing the amount they cost if it weren't for this.
http://www.offthechartsblog.org/what%E2%80%99s-driving-projected-deficits/
The Bush era tax cuts combined with the wars and the downturn are the meat of the problem. Without them, we'd be in much better shape, wouldn't you agree?
As far as the mechanism failing goes, what sort of time frame are we looking at here? 10 years? 20? 40? Social Security has been "failing" for years. So has Medicare. I see concerns and adjustments that need to be made but failure? That sounds an awful lot like wishful thinking on your part. I guess I'm wondering at what point will you admit that they aren't failures.
>It's not hypocritical, Hap, because one comparison is valid and the other one is not.
So - great big shrug here. You think one is valid and one is not, I think they are both valid (and that the question of validity is largely a fake one, designed to avoid dealing with comparisons you don't like.) I'll keep pointing out how Social Security shares similarities to Ponzi schemes, thus illustrating why it will always encounter funding problems, you'll get on your high horse and act like there's nothing there. Hardly unusual.
>demonizing all who don't just like the Nazis did.
*eyeroll* "just like the Nazis did." Seriously dude. Are you unable to see how hypocritical you are here?
>I think you misunderstood what I was saying about results. If libertarian policies achieve the desired results, then let's employ them.
And.. If despotic policies achieve the desired results, let's employ them? If nobody obviously gets harmed in the process of achieving those results, why would it bother you that the means was despotic?
>Does the one life saved ruin someone else's life?
No. In this hypothetical, the saving of that life is solely the result of higher cost for cars. No other person is harmed.
>Is the market for autos elastic or inelastic?
I don't think the price increases I'm talking about aren't generally large enough to make the question very relevant, maybe until you get > $100.
>Would the tax actually end up hurting the ordinary workers and the burden be on both suppliers and buyers?
You'll recall that I said this is a regulation, not a tax. Thus, the burden is ultimately borne by buyers, as it always is, as suppliers must modify their cars to comply with the new regulation and pass that cost off on consumers.
>In the case of Social Security and Medicare, these programs have brought an enormous amount of benefit to a great number of people. They work, Hap, largely because welfare capitalism
I find it interesting that you mention Soc Sec and Medicare in the context of welfare capitalism, because neither of those programs are directed specifically at people in need. Ie people who need welfare. Why is that? You see Mark, I favor the government being a provider of welfare for people who can't otherwise manage it. I do not favor the government simply transferring wealth between generations simply because it benefits older people. Not surprisingly, giving people money brings "benefit" to them. This is why I'm skeptical of your claim of being "results" based. You seem interested in the results of a particular policy/program, and uninterested in the costs. In the case of Soc Sec and Medicare, they aren't aimed towards people who need welfare, and thus they represent a rather large tax on taxpayers, done to give money to a lot of people who could get along fine without it.
>More importantly, we would not be discussing the amount they cost if it weren't for this.
Iraq war cost is a nonsense talking point that, had you a brain, you could see for yourself. A one time cost of 1 trillion is a pittance compared to the 38 trillion estimated unfunded liability of Medicare alone. As to the Bush tax cuts, yes, the federal deficit would be in somewhat better shape if that hadn't come about. Taxpayers would not be in better shape however. I would compromise on increasing taxes if it meant we could address the *gasp* broken structure of Soc Sec and Medicare. Hopefully, the GOP will succeed in doing that, though I wouldn't get my hopes up. Nobody seems to want to be the adult here, especially not the D's. Even saying that about the tax cuts, the demographics of the situation are relentless, and the effect of the Bush tax cuts also dwindles to nonexistent over a long time frame. Some reading for you on the deficit:
http://www.theatlantic.com/business/archive/2011/05/once-again-we-cannot-pay-for-social-security-by-ending-the-bush-tax-cuts-on-high-earners/239556/
Key graf: "This is obviously not sustainable. And much of it is simply driven by the growing ratio of retirees to workers, requiring ever-more Social Security and Medicare dollars to sustain them."
Weird that I would focus on the structure of Soc Sec, eh?
thus illustrating why it will always encounter funding problems
I have no problem admitting that it has funding problems and needs go be overhauled. Taking the leap from "funding problems" to Ponzi schemes is another matter entirely. Speaking of leaps..
If despotic policies achieve the desired results, let's employ them?
Again, no. I wonder how long it will take me to clean out the plaque of right wing propaganda...liberals are not despotic (repeat several times).
The very definition of despotic means harmful even if no one is hurt or killed because freedom is lost. I wouldn't support a benevolent dictatorship. Take a look at the correlation you have drawn here because it's similar to the Ponzi scheme dealio. Somehow proggresivism is despotic. Ridiculous!
I was speaking about political and economic ideologies and the spectrum between democratic socialism and libertarianism. I fall somewhere just to the left of the 50 yard line-welfare capitalism. Despotism doesn't really enter in to the equation. If libertarian solutions are shown to be effective, great. If democratic socialism is shown to be effective, also great....although too much central planning means a dampening of innovation and a whole host of other problems.
Regarding your car and added cost scenario, given the parameters of what you have presented, I could not support it. Even if a life was saved, there are far too many unknowns and the results as well as the long term implications could be disastrous. Your small example though, is in no way a fair comparison to Social Security.
And I guess how I don't understand how adding .10 the cost of ever car sold isn't a tax.
Thus, the burden is ultimately borne by buyers, as it always is, as suppliers must modify their cars to comply with the new regulation and pass that cost off on to the customers
Not really true. First of all, it depends on where the elasticity is-supply or demand. If the demand for autos is inelastic, the burden will fall on the buyers. If it is more elastic on the demand side and less elastic on the supply side, the burden will fall on the suppliers. You'd also have to look at whether or not the input price is affected. If the input price rises substantially, it might cause the auto supplier to shut down.
But let's just say that the 10 cents is added on to the purchase of the car. Draw a supply and demand diagram (shifting the demand curve to the left to reflect the tax). You can clearly see that the 10 cents both raises the price paid by consumers and lowers the price received by sellers-a shared burden. Sellers could try to pass the cost on to the consumer but then they would risk a change in behavior and more people biking or taking the bus. If that demand became more elastic, the auto suppliers would feel the pinch more, right?
The other thing to consider is that regulation isn't always bad and can maintain efficiency. Take the example of the distribution or auction of pollution permits. This is a regulation that also employs a free market solution as buyers and sellers of the permits create a market.
I'd also submit that the lack of regulation of derivatives, CDOS and credit default swaps caused the burden to fall on consumers.
they aren't aimed towards people who need welfare, and thus they represent a rather large tax on taxpayers, done to give money to a lot of people who could get along fine without it.
And that's an excellent example of how your ideology interferes with your clarity of thought. There is no amount of evidence I could present that would change your mind. Grover would be proud!
Taxpayers would not be in better shape however.
I don't see how that statement could be valid given what has happened since the cuts took effect. If their taxes were ridiculously high, then yes, your statement would be correct. But the Laffer Curve isn't really applicable when you consider a tax rate difference of 3 or 4 percentage points.
I would compromise on increasing taxes if it meant we could address the *gasp* broken structure of Soc Sec and Medicare.
I would as well. I'd probably go farther than most Democrats would on SS and Medicare. Bowles Simpson is fine with me.
I'll give your link a good read later as I have a few parties to attend today but I'm sure I will find ideas with which I agree in it. Juris mentioned means testing as a solution for SS. I would support that. Tax cuts alone won't solve the problem just like the hyper focus on spending alone won't solve anything.
>liberals are not despotic (repeat several times).
As you seem to have a hard time with the notion of speaking hypothetically, I'll try to be more clear here. I'm not suggesting that liberals are despotic, I'm trying to get you to tell me what principles (if any) guide your quest for "results." The only consistent principle I can see from you is that you'll try any mechanism if you can be convinced that it will lead to an outcome you prefer. You don't seem to care too much about tradeoffs, though you seem to try to act like you do. Thus the question - if results is all you care about, then why do you care about the means used to get those results?
>The very definition of despotic means harmful
One definition of it does. Another simply means absolute authority. I thought it would be fairly obvious which one I was using..
>Somehow proggresivism is despotic.
Sigh. Again, you are having reading trouble. If you had absolute authority, what principles would constrain your actions, even if you thought your actions might help people or otherwise make things better? I can discern no such principles in you. And again Mark, stop whining about Soc Sec compared to Ponzi. Your Republican to facist/Nazi comparisons register far higher on the offensive meter, though you'll note I won't tell you that you can't make the comparison. (Though I will have a good laugh at you for it.)
>although too much central planning means a dampening of innovation and a whole host of other problems.
How much is "too much" central planning, in your opinion?
>Your small example though, is in no way a fair comparison to Social Security.
Good thing my example was not meant to have anything to do with Soc Sec, huh? Again, I'm trying to tease out what principles drive you.
>And I guess how I don't understand how adding .10 the cost of ever car sold isn't a tax.
Er.. What exactly do you think safety regulations are? They increase the cost of a car in order to save lives. I guess you can call it a tax if you want, but taxes usually don't have a design requirement attached to them. And to cut off the inevitable rejoinder, no, i'm not stating that safety regulations should disappear. I'm, once again, trying to get you to explain your principles. If you can save more peoples lives simply by making cars more expensive, would you do it? Is there a limit to how much you would increase car costs by? Put another way - how much $$ is saving a persons life worth to you? You're right that it's not a simple as I made it out to be in terms of who bears the cost, but for the purposes of this hypothetical it doesn't really matter who bears the cost of this new regulation.
>The other thing to consider is that regulation isn't always bad and can maintain efficiency.
I don't think it's always bad either. But I think a results driven person like yourself tends to ignore side effects of regulation or wave away their consequences.
>Take the example of the distribution or auction of pollution permits.
I remember hearing about this back in college environmental classes - do you know of any case where this actually worked? Back then I thought it was a great idea; now, I'm a bit skeptical because creating a function "synthetic" market like that seems like it'd be awfully hard. The most obvious problem would be that the player with the deepest pockets would simply buy all the permits in order to run the rest of its competitors out of business.
>And that's an excellent example of how your ideology interferes with your clarity of thought.
Sorry, but you've got no business whatsoever lecturing about clarity of thought. Hows about you explain what your problem is? My contention: Soc Sec and Medicare transfer wealth to a lot of people that don't need it. This has a lot of negative side effects: it creates a demographic time bomb, it transfers a lot of wealth from people who could otherwise put it to good use, and has no small part in causing large federal budget deficits. If wrong, how?
>I don't see how that statement could be valid given what has happened since the cuts took effect.
I'm generally of the opinion that the more of their own money that taxpayers keep, the better off they are. Ergo - raised taxes does not equal better off. If you're of the opinion that government spending could have prevented the economic collapse where private savings could not, you have a very high hill to climb IMO.
>I'd probably go farther than most Democrats would on SS and Medicare.
Here's what I'd do. SS = welfare for old folks. Medicare = medical welfare for old folks. (Could probably combine them.) Continually means test those programs to make sure that people aren't gaming the system. You really should be close to eating dog food before taxpayers should step in and help cover the bills. I've never understood why getting past age 65 magically means that someone younger than you should help you cover your bills, especially in the case that you'd get along fine without the help.
Bah, the second part of my response seems to have been eaten.
More childish dishonesty by the right wing-nuts. I'd respond to all your questions, but what's the use? You clearly hate the elderly, women, and kids with autism.
When you are done being childishly dishonest, we can talk. Until then, just assume you are wrong whenever you think something.
Hap, I am more objective on these issues than you are.
You are about as objective as you are pregnant.
For someone supposedly so self reflective I can only wonder what the hell you are looking at when you look inside.
That is why I asked why you lauded Harding's fiscal policy as "massive deregulation" - because saying that made no sense whatsoever. Nor have you given an ounce of insight as to why you said that. You leave me to conclude that you just blurted it out without much, if any, thought at all.
Perhaps this will illustrate the difference between my position and yours for you, Mark.
I am a marijuana smoker, and have been for many years. Personally I think drug laws need to be changed, for a lot of reasons, and would probably still think so even if I didn't smoke marijuana.
However, until that change happens, I think people should be punished according to the law when they are caught breaking it, including me. I have told more than one friend of mine who is a policeman that if they catch me breaking the law and fail to treat me just like anyone else breaking it, they will lose my respect.
You, on the other hand, seem to think that once you (and/or your favored political party) decides a law is unjust they can work to change it at their leisure, and in the meantime just issue an EO telling the cops they are prohibited from enforcing it, and everyone on both sides (enforcement and enforced upon) should feel free to act as if that law didn't even exist.
You've shown that attitude in all the instances I listed above, usually repeatedly.
You either don't seem able to get your head around the idea that once everyone decides they should only obey or enforce the laws they like, one of two results is certain. Either:
1. In a practical sense laws cease to have any meaning, and you get all the bad effects of anarchy regardless of what laws are on the books.
2. Whether or not a given individual has to obey a given law ceases to have anything to do with what the law actually says, and depends solely on that individual's political usefulness to those in power (See: You shouldn't have to obey immigration law if you are "Mexican looking", among many others.) In other words, despotism. You seem to be okay with that result, but only as long as those in power are those you agree with ideologically.
Are you capable of comprehending something that far up the taxonomy, as you like to put it?
Does that include tax laws, anonymous?:)
Suppose marijuana were made legal. Would you then want to be punished for the times that you smoked it and didn't get caught? After it's legal, it's obviously OK to smoke it because the law is the law. So how is that different from changing immigration laws so that the people that are now here can stay on a fast track to citizenship? Or simply have amnesty? A more logical approach given the constraints of what would happen if we arrested all of them and kicked them out. Under your logic, if pot were suddenly made legal, doesn't that "reward" you for breaking the law?
As of right now, I have no problem with illegal immigrants being arrested and deported as it is against the law. I'd like the focus to be on violent offenders first, however. Mainly, though, I want the law changed.
Further, I would suggest that you examine some of Kohlberg's moral dilemmas and see if any of them can change your mind. Unfortunately, you are also making very strident statements in an attempt to push your black and white view of the world which is just plain silly.
Nor have you given an ounce of insight as to why you said that
Because you are doing it again, juris...taking one or two phrases out of an overall point I was trying to make...turning the OCD meter to 11 and then blowing a bowel about it in a sad attempt to "prove me wrong." I told you before that I am tired of playing these games.
Sorry Hap, rescued it from Spam!
I can see from you is that you'll try any mechanism if you can be convinced that it will lead to an outcome you prefer.
I don't know how many times I can say this. No. Again (and for the last time), I was speaking of the tandem between Keynesian economics and laissez faire policies with slight broadening to the line between libertarianism and democratic socialism. Communism, dictatorships, etc don't enter into it and I wouldn't support them to achieve those ends.
How much is "too much" central planning, in your opinion?
The model that caused the Soviet Union to collapse...Cuba...and, I think, China eventually because innovation will always lose out in excessive centrally planned economies. We had the best balance in the 40s, 50s, and 60s, IMHO. We can't go back to that point due to the fact that we are in a global economy now but we do need to fix the areas that are under regulated now as well as the ones that are over regulated.
If you can save more peoples lives simply by making cars more expensive, would you do it? Is there a limit to how much you would increase car costs by? Put another way - how much $$ is saving a persons life worth to you?
Again, I already answered it. No, and that's because of the law of unintended consequences. I'm not sure I can put a dollar amount on a life. That's a very tough question to answer.
do you know of any case where this actually worked?
It's going on right now in the EU and the results have been mixed but I honestly haven't looked into it very much. My point in bringing up was mainly centered around the issue of efficiency.
If wrong, how?
Because we have seen time and again that people won't "put it to good use." Instead, they use the money to further our plutonomy. Instead of investing in something worthwhile, the stick it in a hedge fund or involve themselves in some insane derivative baloney. Supply side economics doesn't work for the same reason socialist utopias don't work: people are greedy and want more power.
I will agree with you that there are problems with Medicare and certainly there are many ways we can adjust the system to make it better.
Here's what I'd do
Generally speaking, I'd agree with you on these ideas. The problem, however, is how insane the cost of health care is right now. The issue of the health care market is a tough one. It's so perfectly inelastic on the demand side that buyers will always be at the mercy of the suppliers who are oligarchal in nature. If you have a workable solution, I'm all ears.
"people are greedy and want more power"
Truer words, you have never spoken.
So how can it be that (D) people want power for 'good', and (R) people only want it for 'evil'?
Since the system is (de facto) designed to give you a choice between the lesser of two evils, it only stands to reason that (D) and (R) will switch places in the power structure every now and again.
Why would you want your (R) enemies to have the power that you want to give to the (D)'s?
Wouldn't it be better to deny the power to your own side, to reduce the power that your enemies will undoubtedly have in the future?
That view pretty much makes me a Conservative. I don't trust either side to benevolently dictate to me. Progressives seem to want more government power, as long as it's used 'correctly'.
Certainly there are plenty of Democrats who are greedy and abuse power. Charlie Rangel would be an example. The difference, though, between the Ds and the Rs is that at least the Ds are making some sort of attempt to restrict private corporations from engaging in disastrous practices. And the Ds are making attempts to end financial sector criminal activity.
They aren't doing a great job of it but at least they aren't the Rs and the libertarians who are living in a fantasy land about free markets. See, it's not about the kind of power you are thinking about it. That's the lie that comes from propaganda. Somehow regulating derivatives or banning CDOs is now communism. Huh? I'm not talking about power in the way you are thinking about it. I'm talking about strengthening the systemic and structural foundation of how our economy works so we have a more perfectly competitive market.
If you have a better solution, I'm all ears. We've had a major economic crisis that resulted from unregulated products like the derivative and the CDO. Your answer to addressing the problems that these products created is...?
Because you are doing it again, juris...
I see. Attempting to actually understand what you said is "playing a game". So, from now on - just to be clear - I am under no obligation to actually try to understand what you said, I should either just believe it (being open minded) or snark about (i.e. being a true believer)?
And you dare accuse anyone else of playing childish games?
So how is that different from changing immigration laws so that the people that are now here can stay on a fast track to citizenship? Or simply have amnesty? A more logical approach given the constraints of what would happen if we arrested all of them and kicked them out. Under your logic, if pot were suddenly made legal, doesn't that "reward" you for breaking the law?
The difference is that your "simple amnesty" is equivalent to saying that if you were a pot smoker back when it was illegal, you go to the head of the line for a permit for medical marijuana, whereas all the people who played by the rules have to wait on you.
Apparently that's what you call "social justice".
Marijuana is a ditch weed, it has been growing wild on the banks of the Platte River for so long the government can't manage to stamp it out. (Actually they probably could eventually, but it's be every bit as big and expensive a project as Mississippi flood control has been.) It's not quite the same as if government were the only possible way you could get it, as is the case with a visa or citizenship papers.
The difference, though, between the Ds and the Rs is that at least the Ds are making some sort of attempt to restrict private corporations from engaging in disastrous practices. And the Ds are making attempts to end financial sector criminal activity.
Are they? Or are they just trying to make it so you can only get away with it if you donate to the correct political party? The games of Chuck Schumer, Chris Dodd, Maxine Waters and many, many others suggest it's the latter.
Funny how none of their shenanigans never show up on your front page. Just like Obama's shenanigans with campaign finance law doesn't.
But why would they need medical marijuana if it was legal everywhere? I'm afraid I don't get your logic. You are a pot smoker or a supporter of pot smoking and you work really hard to make pot legal and then it is. You are an illegal immigrant or a supporter of amnesty for illegal immigrants. You work really hard to get the amnesty and then you do. Either way you are changing the law. I think the question you have to ask yourself is why you would support the former and not the latter. And I guess I have to reiterate this point because you seem to have missed it. Let me bold it for you.
As of right now, I have no problem with illegal immigrants being arrested and deported as it is against the law. I'd like the focus to be on violent offenders first, however. Mainly, though, I want the law changed
So, enough with the silly mis-characterization whose end goal is winning the argument. You are painting me to be something I am not.
I've talked about Dodd's BS plenty of times on here. You must not be paying attention. As to the other folks and Obama/campaign finance, I've looked into those charges and there isn't much there although I know that's not what WorldNet Daily et al say so whatever,dude.
Juris-take a look at the exchange between me and Hap above. If I had said a 10 cent charge was a regulation and not a tax you would have blown a blowel and nit picked it to shit. Notice what I did. I wrote one line about it and then went back to the larger point he was trying to make. You, however, focused like a laser on something that you thought you might be able to get me on and then ignored my overall point which you still really haven't addressed.
Not surprising because if you did the end result would be me being right. But that is the reason why I don't really want to engage you about this point. Fool me twice...
Fine, you did 'correct' yourself by saying it was actually the fiscal policy you were talking about. That is just a big change from "massive deregulation" (i.e. they aren't the same, not even close) - and that was what I was trying to follow. So you can jump around any argument you like, without acknowledging that you are in fact no longer talking about the same thing - and then wonder why people don't understand what you are saying?
If I had said ... you would
Nice conjecture and projection all wrapped into one. I didn't blow a bowel about "massive deregulation" - I was trying to understand what point you were trying to make. Which I have to guess was that there wasn't a point - you were just talking to hear the sound of your voice.
All so you can "win"? Fine, you win. Happy? Can we discuss anything without you believing it is a junior high debate that you simply must win?
I'm afraid I don't get your logic.
Then you're likely to be deliberately missing the point. As I said above, unlike marijuana, you can't get a visa or citizenship papers anywhere except from the government. In other words, all those who obeyed the rules to get their visa/citizenship under your proposal go to the back of the line, where they get to wait until all those who came here illegally go first.
As of right now, I have no problem with illegal immigrants being arrested and deported as it is against the law.
That's a recent development. A few months back, you were singing a different tune.
As to the other folks and Obama/campaign finance, I've looked into those charges and there isn't much there...
No evidence needed, just deny and that's it? What I've read is about disabling all security measures for credit card donations, making that money untraceable. Good thing he reneged on his promise to take public campaign financing, huh? They are required to be audited, he'd have been in jail if he'd tried to pull this then. This disabling cannot be done accidentally. If you have different information, please link to it.
Wasn't it you that had such heartburn about "anonymous outside money from untraceable sources"?
What's the point, juris? As far as Mark is concerned, there are no standards like double standards. How he can even see past the beam in his own eye to bitch about the specks in other's eyes is beyond me, though.
Larry - must have something to do with projection and the voices in his head he is always conversing with.
"The difference, though, between the Ds and the Rs is that at least the Ds are making some sort of attempt to restrict private corporations from engaging in disastrous practices. And the Ds are making attempts to end financial sector criminal activity."
Oh, you sweet sweet child.
Didn't we just have this discussion?
The (D)'s who get 51% of the campaign money are fighting it out against the (R)'s 49%?
Jump on the paranoia train Mark, and realize that neither "party" is going to fix anything.
Perhaps a telling question - worthy of a post perhaps- would be, Is there anything the US government is doing today that is unsustainable?
A simple 'yes' or 'no' is NOT acceptable.
You must not be paying attention.
Funny, I managed to pay attention well enough to realize it was almost a year before you decided that you actually did have a problem with a tax cheat as Treasury Secretary.
Maybe the problem you have with it is that the problem didn't go away like you hoped.
Actually, I still don't have a problem with him as a "tax cheat." That story has become so caricatured over the years that it's not really rational any more. My problem with Geithner is actually something which you would likely applaud: his embrace of deregulation which led to the collapse in 2008. Further, his looking the other way was borderline criminal.
And, as I said before, it doesn't matter if they Ds took more money from the financial sector. They aren't obeying the masters like the good little pups in the GOP are so your line of thinking makes no sense. Unless you somehow think that the Democrats secretly don't support the finreg bill and it's all some sort of plot or something. If that's the case, I'd like to hear what it is!
No problem Mark. You are off the front page, so I expect this post to die.
But let me point out, for future reference, you justify your position with the phrase:
"it doesn't matter if they Ds took more money " [sic]
OK. If that's your position, I expect you to stick with it. Campaign finance doesn't matter. I don't agree with you, so we can discuss this topic some other time.
As for your R vs D partisanship, I just don't understand why you would persist in it. But I'm sure it'll get pointed out eventually.
give it up markadelphia, like you know all that is going on in dc behind the scenes. dems very well could be keeping things the way they are for all you know. they may pass a law but leave a giant loophole for their connected friends to get through.
I'm sure that's possible, sw, and you are correct, I don't know every little thing that is going on behind the scenes. What I do know is this.
One party is making an effort to place regulations in place that will prevent gambling addicts from ruining the world's economy as they nearly did in 2008. Their ideas aren't perfect but at least they are doing something. The other party is shouting for less regulation (?!) and accusing the first party and its supporters like me of being communists. It's pretty clear to me who the fucking adults are in the room.
>Their ideas aren't perfect but at least they are doing something.
Did you ever say/think that about president Bush? No you didn't, you nitpicked their ideas.
What I do know is this.
One party is making an effort to place regulations in place that will prevent gambling addicts from ruining the world's economy as they nearly did in 2008.
Wrong. That's what you believe.
What you know is one party is making efforts to put regulations in place which they claim will prevent etc. You don't know what effect those regulations will have, as you stated above.
The other party is shouting for less regulation (?!) and accusing the first party and its supporters like me of being communists.
...and of course the concept that more regulations always = more loopholes and a less transparent process escapes you entirely, does it?
But no, it must be for the reasons that align with your assumptions about both parties, it cannot possibly have any other motivation. Even though "Dodd-Frank" is a big red flag suggesting that there will indeed be carefully crafted loopholes to benefit the "friends" of the writers. Not because of their party either, but because of the personal history of the individuals.
How adult of you. This is "critical thinking" where you come from, is it?
Think about that one for a minute.
Your claim is that Republicans are
shouting for less regulation (?!)
because they failed to support a "financial reform" bill written by "Countrywide Chris" and a man the Boston Globe labels as having "his fingerprints all over the financial crisis". Note that this is the major daily of the largest city in his home state, owned by the New York Times, and hardly a "right wing rag" by anyone's measure.
True, I haven't heard of an alternate FinReg bill by the Republicans... but considering how long Democrats refused to allow anything Republicans did to ever come to the floor for debate in the first place, I can't call that grounds to assume that the Republicans have no ideas on the subject, either.
Well, what do you guys propose then? Recall the Manzi article in which he stated correctly that the financial sector of this country is too interconnected and that's what caused our problems. So what do we do about that? This is where government comes in-restrain evil, right? Well, there's a whole lot of evil going on right now in the financial sector which is the epicenter for most of our economic problems.
"people are greedy and want more power" Truer words, you have never spoken. So how can it be that (D) people want power for 'good', and (R) people only want it for 'evil'? Since the system is (de facto) designed to give you a choice between the lesser of two evils, it only stands to reason that (D) and (R) will switch places in the power structure every now and again. Why would you want your (R) enemies to have the power that you want to give to the (D)'s? Wouldn't it be better to deny the power to your own side, to reduce the power that your enemies will undoubtedly have in the future? That view pretty much makes me a Conservative. I don't trust either side to benevolently dictate to me. Progressives seem to want more government power, as long as it's used 'correctly'.
"people are greedy and want more power" Truer words, you have never spoken. So how can it be that (D) people want power for 'good', and (R) people only want it for 'evil'? Since the system is (de facto) designed to give you a choice between the lesser of two evils, it only stands to reason that (D) and (R) will switch places in the power structure every now and again. Why would you want your (R) enemies to have the power that you want to give to the (D)'s? Wouldn't it be better to deny the power to your own side, to reduce the power that your enemies will undoubtedly have in the future? That view pretty much makes me a Conservative. I don't trust either side to benevolently dictate to me. Progressives seem to want more government power, as long as it's used 'correctly'.
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