Friday, August 30, 2019

Billionaires are a Sign of Economic Failure — Max Lawson

Historically, and especially in the United States in the early part of the 20th century, monopoly power was rightly viewed as a serious threat to the economy and to society, and steps were taken to break up monopolies. It was President Franklin Roosevelt who famously said that “government by organized money is just as dangerous as government by organized mob.” However, in recent decades, neoliberal economics has led a much more benign view of monopoly power, and very little action is now taken to dismantle them. I think this is a key distinction between neoliberalism and classical liberal economics. These monopolies impose hidden monopoly taxes on every consumer, as it enables these companies, and their wealthy shareholders, to extract excessive profits from the market, directly fueling the growth in extreme wealth at the expense of ordinary citizens.
Two failures are involved, one entailed by the other.

The first failure is market failure. Asymmetry enables rent extraction.

The second fairlure is policy failure. Government capture generates policy that enables rent extraction.

That's neoliberalism in a nutshell, and using these failures neoliberals are out to dominate the world politically through control of the global economy. Economic warfare to destroy potential competitors and the uncompliant is evidence of this.

Ironically, the only countries that prosecute billionaire ("oligarch") for transgressions are Russia and China. The West? Not so much.

Billionaires are a Sign of Economic Failure
Max Lawson | Head of Inequality Policy at Oxfam International

See also

Naked Capitalism
Marshall Auerback: We Are Clearly Living in a Bizarro Capitalism Era—And It’s Time to Change How the World Manages Economies

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