The president's economic legacy could amount to a bailout for the richThe Week
Obama is right to be worried about income inequality — it’s gotten a lot worse under his watch
John Aziz
The president's economic legacy could amount to a bailout for the richThe Week
11 comments:
Obama: "We're out of money!"
The ONLY worries current politicians have come when REAL problems finally become political (re-election) problems.
Until then, they see no, hear no & have no worries.
Once they feel worried, they look for ways to distract people from the REAL citizen worries.
Once gay marriage wears off ... they might uncover a terrorist plot among a worldwide cabal of sinestrals, who are plotting against dextrals.
I have a list right here in my hand. (Won't tell you which one.)
Good point, Roger. One might also recall how Obama actually became a supporter of gay marriage. He was against it (or openly endorsing it) until he was informed in no uncertain terms that considerable sums of campaign money would not be forthcoming if he didn't unambiguously endorse it. You have to show the modern politician that you can hurt him and taking away his money hurts him more than the idea of losing votes, which can always be bought or stolen.
"You have to show the modern politician that you can hurt him and taking away his money hurts him more than the idea of losing votes, which can always be bought or stolen."
Which is why capitalism and democracy are antithetical. America is not a democracy as government of the people, by the people and for "the people," as advertised. It is a republic, which is to say, government by an elite, in this case a plutocracy. The Republican Party advertised this fact in its name. The Democratic Party perpetrates the myth. The fact is that everything is happening in accordance with the plan ov the founding fathers, as the elitist Roberts court recognizes.
Seems more productive to say that capitalism is just another tool to be adequately regulated in a functioning democracy.
Human biology & culture have assimilated all kinds of tools & practices which are safe to use ONLY in controlled settings.
Nothing special about capitalism in that regard.
As Minsky implied with his Heinz allusion, there are "57" different kinds of capitalism.
However that depends on how capitalism is defined. The way neoliberals define it there is one kind of capitalism, laissez-faire, with the sole function of government providing security of person and property. All other forms are deviations that introduce more and more imperfections. This is the basis of economic liberalism and neoclassical economics including it's Austrian counterpart.
Neoliberals, ordoliberals, and Austrians lump socialism, communism and Keynesianism together. It's the market state v. welfare state. The market state is amoral and run on the basis of market efficiency, that is, efficiency of capital on the assumption that history is about progress and progress is equatable with economic growth based on capital formation.
"history is about progress and progress is equatable with economic growth based on capital formation."
I think both Adam Smith and Karl Marx would agree with this statement.
Yes, all economists would.
However, the question is whether capital is for people or people for capital. Should capital formation be put ahead of people. Marx would not agree with capital before people and I doubt that Smith would either, since he was chiefly a moral philosopher by profession.
The argument that capital should be put ahead of people is basically the trickle down theory. Contemporary moralists reject on the principle that a person must always and everywhere be treated morally as a end rather than a means.
This is a fundamental principle of ethics, and it is the foundation of political liberalism. Economic liberalism, whether classical or neoliberal, contradicts that, which is why economic liberalism and political liberalism are antithetical.
Tom - I don't think it is a chicken or egg type question. Capital is an extension of people and would have no application and/or value without people. I think it is a yin/yang type question. The Soviets put too much emphasis on capital investment in the early years at the expense of consumption. I think the U.S. may be putting too much emphasis on consumption at the expense of capital.
Aside from that, getting back to why the powers that be ought to be worried about income inequality the video in the link below is priceless.
http://www.youtube.com/watch?v=_Go8tnl21MU&feature=youtu.be
If we examine the history, it's about power. In the hunter-gatherer stage these issues seldom arose. It wasn't until humanity developed beyond the stage of everyone in the society knowing each other personally, that impersonal relationships developed.
Moreover, larger populations needed more stable resources, agriculture replaced hunting-gathering and a surplus was created. Division of the surplus became central and paramount were the specialists needed to product it (at this stage the temple was the center of it) and the warriors to protect it (at this stage the palace was the power center).
Class and power structure arose around agricultural leading to monarchy and then aristocracy, with the titled (holding title to the land) owning the primary means of production.
This began to change with the rise of industrial capitalism, where the haute bourgeoisie that owned capital goods began to assume an equal role with the land owners. The liberal revolution was actually the revolt of the haute bourgeoisie and their allies in the intelligentsia that against the landed aristocracy of the feudal age.
Smith was writing at the time of the American Revolution, to be followed by the French Revolution, and the failed revolutions of 1848, contemporaneous with Marx. Liberalism to them meant overthrowing the landed rentiers as the central economic and political force and establishing a new legal basis. Smith represented the bourgeoisie while Marx represented the proletariat.
Capitalism was about replacing feudalism as the dominant mode of production as well as the political and economic power center. We are still in that dynamic, with capital having absorbed land and aristocracy dealt a death-blow by WWI and the Russian Revolution of 1917.
Marx recognized that capitalism was the next iteration in the historical dialect of his economic materialism, and saw realized that this moment of history would have to be completed to be replaced by the next iteration, which he saw as the rise of the worker class — comprising the vast majority of people — to political and economic power.
In this view, capitalism is not "the end of history" as Fukuyama thought, but rather a stage in a historical process that is unfolding. The question is where we are in that process now. As workers ready to assert their real power, which they have never been able to do before and hold onto it, or are we at the cusp of a transition?
It would seem that capitalism has a long way to go before the world brought under this system, and neoliberalism seems to be the dominant form of capitalism shaping the global economy under a tiny elite that closely resemble the aristocratic elites of the past. On the other hand, there is a rising current of opposition by ordinary people to what they perceive as grossly unfair.
"The Soviets put too much emphasis on capital investment in the early years at the expense of consumption. I think the U.S. may be putting too much emphasis on consumption at the expense of capital. "
That's a bit of a simplification. The Soviet's put a lot of attention on capital from the get=go because they realized that the capitalist world would do them in otherwise. Add to that corruption at the top and the abandonment of socialists ideals in practice and the operations collapsed of its own weight. It was not an experiment in socialism or a command economy at all, but a response to particular historical circumstance by a corrupt leadership.
The ideal balance of consumption goods production and capital goods production in a developed economy is thought to be about 80-20, with a very large service sector and considerable government services. Of course, in contemporary society, military and security are a vast component of government services and production related to it.
Typically, the ratio of capital goods to consumption goods is about 80-20 in a newly emerging economy and that ratio shifts with development.. It's called "rebalancing."
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