Rudy G. presented a good counter argument to the whining over the bonuses. Basically bonuses are taxed and the government will in the end be seeing a bonus as well. However this is classic government vs big corporation and the regular folk are the innocent bystanders.
I wonder what malady is addling your brain to allow this sort of argument seem reasonable at all unless you truly are a corporatist. You are taking money that is going to be paid for by ballooning the federal debt, so by taxes later or inflation, then giving it to a financial executive who ran his company in the ground not necessarily to save the company, but rather allow him to buy a whole bunch of overpriced shit just for the sake of protecting the overpriced shitmongerers.
If you are so infatuated with overpriced shitmongerers, just cut out the middleman and buy some overpriced shit for the government for public use. Or for local taxation, just aid the state government directly.
I've always thought that if you're going to get fed money, you need to play by the fed rules.
If you don't want to play by their rules, you don't get the money.
Pretty much this.
If the tables were turned, if it were the corporations handing out free money to citizens and then attaching stipulations to that money, the pro-big-business folks would be shrugging their shoulders and saying, "Their money, their rules."
Feral on
every person who doesn't like an acquired taste always seems to think everyone who likes it is faking it. it should be an official fallacy.
the "no true scotch man" fallacy.
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HarrierThe Star Spangled ManRegistered Userregular
edited January 2009
I wholeheartedly support this idea. Make sure that salaries and bonuses are capped at $400k, and we've got a deal.
It's time for some goddamn class warfare on the rich.
Harrier on
I don't wanna kill anybody. I don't like bullies. I don't care where they're from.
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ShadowfireVermont, in the middle of nowhereRegistered Userregular
I wholeheartedly support this idea. Make sure that salaries and bonuses are capped at $400k, and we've got a deal.
It's time for some goddamn class warfare on the rich.
No.
Really, when we're talking about banks that are being propped up by federal dollars, I'm all for salary caps. But in the private sector, there should be no caps. Simply put, if you're doing a great job running your business, then you should receive whatever they are willing to pay you.
The problem this time around is that the folks who were voting (stockholders) weren't paying good enough attention, and the banks were being shady (all sorts of false information, lack of transparency, etc). Work on those issues... you don't need salary caps.
I wholeheartedly support this idea. Make sure that salaries and bonuses are capped at $400k, and we've got a deal.
It's time for some goddamn class warfare on the rich.
No.
Really, when we're talking about banks that are being propped up by federal dollars, I'm all for salary caps. But in the private sector, there should be no caps. Simply put, if you're doing a great job running your business, then you should receive whatever they are willing to pay you.
The problem this time around is that the folks who were voting (stockholders) weren't paying good enough attention, and the banks were being shady (all sorts of false information, lack of transparency, etc). Work on those issues... you don't need salary caps.
The problem is that there is no free market for executives; it's just a bunch of other executives acting as bosses for executives, and everyone voting each other pay raises. There needs to be some regulation as to what compensation is considered "in the best interests of the company," and what compensation is "I'll vote you a raise in this company if you vote me one in that company."
I wholeheartedly support this idea. Make sure that salaries and bonuses are capped at $400k, and we've got a deal.
It's time for some goddamn class warfare on the rich.
No.
Really, when we're talking about banks that are being propped up by federal dollars, I'm all for salary caps. But in the private sector, there should be no caps. Simply put, if you're doing a great job running your business, then you should receive whatever they are willing to pay you.
The problem this time around is that the folks who were voting (stockholders) weren't paying good enough attention, and the banks were being shady (all sorts of false information, lack of transparency, etc). Work on those issues... you don't need salary caps.
The problem is that there is no free market for executives; it's just a bunch of other executives acting as bosses for executives, and everyone voting each other pay raises. There needs to be some regulation as to what compensation is considered "in the best interests of the company," and what compensation is "I'll vote you a raise in this company if you vote me one in that company."
So you're arguing for a pay cap on executive pay all the time, and for all companies instead of just the ones receiving taxpayer money because you feel that the market cannot control the system? I don't want to strawman but that is the position that fits in well with that quote.
To put it simply, the boards who have that kind of philosophy are going to go under in bad time or be forced to go onto corporate welfare, as many of the big firms have been. The problem is solved if the government takes care of its own money.
I wholeheartedly support this idea. Make sure that salaries and bonuses are capped at $400k, and we've got a deal.
It's time for some goddamn class warfare on the rich.
No.
Really, when we're talking about banks that are being propped up by federal dollars, I'm all for salary caps. But in the private sector, there should be no caps. Simply put, if you're doing a great job running your business, then you should receive whatever they are willing to pay you.
The problem this time around is that the folks who were voting (stockholders) weren't paying good enough attention, and the banks were being shady (all sorts of false information, lack of transparency, etc). Work on those issues... you don't need salary caps.
The problem is that there is no free market for executives; it's just a bunch of other executives acting as bosses for executives, and everyone voting each other pay raises. There needs to be some regulation as to what compensation is considered "in the best interests of the company," and what compensation is "I'll vote you a raise in this company if you vote me one in that company."
So you're arguing for a pay cap on executive pay all the time, and for all companies instead of just the ones receiving taxpayer money because you feel that the market cannot control the system? I don't want to strawman but that is the position that fits in well with that quote.
I don't think I used the word "pay cap" anywhere in there.
What I'm saying is that something needs to be done about the "revolving door" phenomenon in the executive sector; the current strategy is to get a job that overpays you by way too much, fuck it up enough that you get fired, get your golden parachute, then get another job, repeat ad infinitum. We need to do something to fundamentally change the executive culture that has created the current compensation moneygrab that has basically turned these people into a modern-day aristocracy. Does that mean some sort of regulation regarding conflicts of interest between serving as an executive for one company and on the board of trustees for others? Some sort of time limit after leaving an executive job before you can work for another company? Some sort of limitation on golden parachutes? Possibly pay caps? I don't know. But what we have now is much closer to an oligopoly than a competitive free market, and everyone but the lucky few are getting fucked by it.
“ISN’T it funny/How they never make any money/When everyone in the racket/Cleans up such a packet.†That Basil Boothroyd poem was originally written about the movies, but it could just as well apply to banking.
In its last three years, Bear Stearns paid $11.3 billion in employee compensation and benefits. According to its 2007 annual report, Lehman Brothers shelled out $21.6 billion in the three years before, while Merrill Lynch paid staff over $45 billion during the three years to 2007.
And what have shareholders got from all this? Lehman’s got nothing (the company went bust). Investors in Bear Stearns received around $1.4 billion of JPMorgan Chase stock, now worth just half that after the fall in the acquirer’s share price. Merrill Lynch’s shareholders got shares in Bank of America (BofA) which are now worth just $9.6 billion, less than a fifth of the original offer value. Meanwhile, Citigroup paid $34.4 billion to its employees in 2007 and is now valued by the stockmarket at just $18.1 billion.
All this has reinforced the idea that banking is simply a gravy train for employees. The row over the early payment of bonuses at Merrill Lynch shows yet again that insiders’ interests come first (those to BofA staff, however, are likely to shrivel).
The case against banks goes something like this. Over the past 25 years, the cost of finance has been low and asset prices have generally been rising. That has encouraged banks to use more leverage in order to earn high returns on equity. The process of lending money against the security of assets, or trading assets with the banks’ capital, helped to push asset prices even higher. A sizeable proportion of the profits that resulted from all this activity was then handed out to employees in the form of wages and bonuses.
But when asset prices started to fall, the whole system unravelled. Banks were forced to cut the amounts that they had borrowed, putting further downward pressure on prices. The “shadow banking systemâ€, which relied on bank finance, started to default. The result was losses that outweighed the profits built up in the good years; Merrill Lynch lost $15.3 billion in the fourth quarter of 2008 alone, compared with the $12.6 billion of post-tax profits it earned in 2005 and 2006 combined.
In effect, executives and employees were given a call option on the markets by the banking system. They took most of the profits when the market was booming and shareholders bore the bulk of the losses during the bust.
What about the efforts made to align the incentives of employees, executives and shareholders? Employees were often paid in restricted stock and thus suffered heavily when their firms collapsed; Dick Fuld, the boss of Lehman Brothers, was a prominent example. Why then were bankers not more cautious, given the risks to their own wealth?
There were two main reasons. First, their base packages (pay and cash bonuses) were sufficiently large to make them feel financially secure. That gave bankers a licence to gamble in the hope of earning the humungous payouts that would take them into the ranks of the über-wealthy. The second reason was that the bankers simply did not recognise the risks they were taking. Like most commentators (including central bankers), they thought that the economic outlook was stable and that the financial system was doing a good job of spreading risk.
Henceforth two things need to be done. The first is that the trigger for incentives (as well as the payments themselves) need to be longer-term in nature. Bonuses could still be paid annually but based on the average performance over several years; if bankers are rewarded for increasing the size of the loan book, their pay-off should be delayed until the borrower has established a sound payment record. The effect would be to claw back profits earned by excessive risk-taking.
The second is that the banks’ capital has to be properly allocated. If traders are given licence to use leverage to buy into rising asset markets, then the trading division should be charged a cost of capital high enough to reflect the risks involved.
Impossible, the banks might say: our star employees will never tolerate such restrictions. But if there is ever going to be a time to reorganise the incentive structure now must be it. A threat to quit will be pretty hollow, given the state of investment banking. And few traders will have the clout to set up their own hedge funds in today’s market conditions. In any case, the greediest employees may be the ones most likely to usher in the next banking crisis. Better to wave them goodbye and wish good luck to their next employer.
I wholeheartedly support this idea. Make sure that salaries and bonuses are capped at $400k, and we've got a deal.
It's time for some goddamn class warfare on the rich.
No.
Really, when we're talking about banks that are being propped up by federal dollars, I'm all for salary caps. But in the private sector, there should be no caps. Simply put, if you're doing a great job running your business, then you should receive whatever they are willing to pay you.
The problem this time around is that the folks who were voting (stockholders) weren't paying good enough attention, and the banks were being shady (all sorts of false information, lack of transparency, etc). Work on those issues... you don't need salary caps.
The problem is that there is no free market for executives; it's just a bunch of other executives acting as bosses for executives, and everyone voting each other pay raises. There needs to be some regulation as to what compensation is considered "in the best interests of the company," and what compensation is "I'll vote you a raise in this company if you vote me one in that company."
So you're arguing for a pay cap on executive pay all the time, and for all companies instead of just the ones receiving taxpayer money because you feel that the market cannot control the system? I don't want to strawman but that is the position that fits in well with that quote.
I don't think I used the word "pay cap" anywhere in there.
What I'm saying is that something needs to be done about the "revolving door" phenomenon in the executive sector; the current strategy is to get a job that overpays you by way too much, fuck it up enough that you get fired, get your golden parachute, then get another job, repeat ad infinitum. We need to do something to fundamentally change the executive culture that has created the current compensation moneygrab that has basically turned these people into a modern-day aristocracy. Does that mean some sort of regulation regarding conflicts of interest between serving as an executive for one company and on the board of trustees for others? Some sort of time limit after leaving an executive job before you can work for another company? Some sort of limitation on golden parachutes? Possibly pay caps? I don't know. But what we have now is much closer to an oligopoly than a competitive free market, and everyone but the lucky few are getting fucked by it.
Generally speaking, profits are privatized and losses are nationalized. A bank that makes $100B profit for three years and on year four is $500B in the red has averaged a net loss of $200B over four years. However, executive and employee compensation won't be based on that final number, it will be based on the number of the day. This encourages faulty lending and high-risk business practices. Why in the world should you play it safe and responsible if you keep anything you win and everyone else pays if you lose?
All this "free market" nonsense can kindly fuck off. Banks aren't a free market, and they haven't been during any of our lifetimes. They operate with all sorts of government protection and guarantees. The cost of that protection, of those guarantees, and of being allowed to participate in a business where failure is incredibly detrimental to the well-being of our United States is putting up with some rules to prevent you from assfucking the rest of America. I don't know if pay caps are an optimal solution or even the best one, but we're well past the point where "LOLOLOL FREE MARKET FREE MARKET!" means a goddamn thing.
So... why can't we just nationalize banking? Or at least have a bank that is run by the government to make sure things aren't going crazy?
Socialism socialism lol lol!
That's about it. Nationalizing the failed banks while wiping out shareholders is probably the most cost-effective, fastest, most-direct, and economically safest option we have right now. We're drifting towards socialized banks with private executives, which is all kinds of terrible and might be one of the most spectacular moral hazards in history, at least in dollar terms.
So... why can't we just nationalize banking? Or at least have a bank that is run by the government to make sure things aren't going crazy?
Because "government makes a poor bank manager" according to Geithner and Larry Summers who inexplicably has the ear of the President despite being a grade A moron who helped us get into this mess.
enlightenedbum on
Self-righteousness is incompatible with coalition building.
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AegisFear My DanceOvershot Toronto, Landed in OttawaRegistered Userregular
edited January 2009
Yea, when the Economist is arguing that something has to be done with bonuses/the system in the direction of more regulation it's pretty much over.
So... why can't we just nationalize banking? Or at least have a bank that is run by the government to make sure things aren't going crazy?
Because "government makes a poor bank manager" according to Geithner and Larry Summers who inexplicably has the ear of the President despite being a grade A moron who helped us get into this mess.
I suspect it has more to do with a public relations fear that nationalizing the banks will bring about the mediapocolypse, but it is unfortunate to see so many familiar names making so many familiar mistakes in the economy.
Yea, I think the main case against nationalizing banks is cries of socialism. Many American's still have a very negative view of socialism, unfortunately. I mean, you'd think now, that after we had this huge of a fuckup by the private sector, people would be more accepting to nationalized banking. It really can't get much worse than this mess, but just try and bring it up without getting shouted down as a socialist.
Correct me if I'm wrong, didn't we have a national bank at one point and didn't Jackson have to kill it because it was crazy corrupt?
I feel like there might be some problems with this idea.
Jackson more killed it because he was a stupid asshole, but yes. Also we already have a central bank in this country, we just call it the Federal Reserve.
enlightenedbum on
Self-righteousness is incompatible with coalition building.
Correct me if I'm wrong, didn't we have a national bank at one point and didn't Jackson have to kill it because it was crazy corrupt?
I feel like there might be some problems with this idea.
No institution is uniquely immune to corruption, but it would be far easier to force a nationalized bank to work in the public's best interest than it would be to force a privatized one.
Further, my favorite idea has been temporary nationalization until the bank is no longer toxic, at which point it is resold to the private sector. Essentially acknowledging that segments of the financial sector have become so corrupt and mismanaged that they cannot function on their own and must be temporarily gutted and reconstructed by the Feds in order to function. I'm not against a permanent socialized banking institution, but I don't think it would be significantly better than a well-managed, properly regulated private banking institution.
I've said it before on here, I'm against the culture of bonuses, mainly because the absolute abuse this system gets. I've seen/heard of shit done in the last week of a bonus/target period with a spirit of "get bonus now, start sorting it out from tomorrow" attitude and this can not be healthy for any financial institution.
Nationalizing the whole banking sector however, seems like a pretty terrible idea. With the current bailout plan the government already has a way to strong arm their position and I'm not sure full nationalization would send the right message to the economy.
Also, the argument that "our best performers won't stand for the bonus freeze" made me laugh.
As in "No person in the company can have combined compensation of salary, bonuses, and stocks higher than -for example- 100x the lowest paid employee in the company."
So if you've got a part-time janitor earning the equivalent of 20k/yr? Compensation for the CEO can't be more than 2 million/yr.
To be frank, I'd be fine with this sort of rule to be standard, not just for companies accepting bailout money.
I wholeheartedly support this idea. Make sure that salaries and bonuses are capped at $400k, and we've got a deal.
It's time for some goddamn class warfare on the rich.
No.
Really, when we're talking about banks that are being propped up by federal dollars, I'm all for salary caps. But in the private sector, there should be no caps. Simply put, if you're doing a great job running your business, then you should receive whatever they are willing to pay you.
The problem this time around is that the folks who were voting (stockholders) weren't paying good enough attention, and the banks were being shady (all sorts of false information, lack of transparency, etc). Work on those issues... you don't need salary caps.
The problem is that there is no free market for executives; it's just a bunch of other executives acting as bosses for executives, and everyone voting each other pay raises. There needs to be some regulation as to what compensation is considered "in the best interests of the company," and what compensation is "I'll vote you a raise in this company if you vote me one in that company."
So you're arguing for a pay cap on executive pay all the time, and for all companies instead of just the ones receiving taxpayer money because you feel that the market cannot control the system? I don't want to strawman but that is the position that fits in well with that quote.
I don't think I used the word "pay cap" anywhere in there.
What I'm saying is that something needs to be done about the "revolving door" phenomenon in the executive sector; the current strategy is to get a job that overpays you by way too much, fuck it up enough that you get fired, get your golden parachute, then get another job, repeat ad infinitum. We need to do something to fundamentally change the executive culture that has created the current compensation moneygrab that has basically turned these people into a modern-day aristocracy. Does that mean some sort of regulation regarding conflicts of interest between serving as an executive for one company and on the board of trustees for others? Some sort of time limit after leaving an executive job before you can work for another company? Some sort of limitation on golden parachutes? Possibly pay caps? I don't know. But what we have now is much closer to an oligopoly than a competitive free market, and everyone but the lucky few are getting fucked by it.
It's called the Principal-Agent problem, and I've already heard of it in my introduction to macroeconomics class.
This is actually the same thing that caused places such as Enron and WorldCom to collapse: in the '90s, corporations attempted to solve the problem by offering compensation in the form of stock options for CEOs, giving them locked-in prices per share regardless of whether the price of the share went up. As a result, CEOs could make much more money if they inflated, artificially, the perceived value of their company, and thus the stock price. In addition, auditing firms that were supposed to be checking over these companies were in their pocket, too, due to lucrative consulting contracts, and so the inflated value just rose and rose until the dot com bubble burst.
I've said it before on here, I'm against the culture of bonuses, mainly because the absolute abuse this system gets. I've seen/heard of shit done in the last week of a bonus/target period with a spirit of "get bonus now, start sorting it out from tomorrow" attitude and this can not be healthy for any financial institution.
Nationalizing the whole banking sector however, seems like a pretty terrible idea. With the current bailout plan the government already has a way to strong arm their position and I'm not sure full nationalization would send the right message to the economy.
Also, the argument that "our best performers won't stand for the bonus freeze" made me laugh.
I don't know if anyone is seriously forwarding total nationalization as an argument, some of us (myself included) are saying partial (and probably temporary) nationalization in order to handle the toxic firms is probably the idea way to go.
As in "No person in the company can have combined compensation of salary, bonuses, and stocks higher than -for example- 100x the lowest paid employee in the company."
So if you've got a part-time janitor earning the equivalent of 20k/yr? Compensation for the CEO can't be more than 2 million/yr.
To be frank, I'd be fine with this sort of rule to be standard, not just for companies accepting bailout money.
I wholeheartedly support this idea. Make sure that salaries and bonuses are capped at $400k, and we've got a deal.
It's time for some goddamn class warfare on the rich.
No.
Really, when we're talking about banks that are being propped up by federal dollars, I'm all for salary caps. But in the private sector, there should be no caps. Simply put, if you're doing a great job running your business, then you should receive whatever they are willing to pay you.
The problem this time around is that the folks who were voting (stockholders) weren't paying good enough attention, and the banks were being shady (all sorts of false information, lack of transparency, etc). Work on those issues... you don't need salary caps.
The problem is that there is no free market for executives; it's just a bunch of other executives acting as bosses for executives, and everyone voting each other pay raises. There needs to be some regulation as to what compensation is considered "in the best interests of the company," and what compensation is "I'll vote you a raise in this company if you vote me one in that company."
So you're arguing for a pay cap on executive pay all the time, and for all companies instead of just the ones receiving taxpayer money because you feel that the market cannot control the system? I don't want to strawman but that is the position that fits in well with that quote.
I don't think I used the word "pay cap" anywhere in there.
What I'm saying is that something needs to be done about the "revolving door" phenomenon in the executive sector; the current strategy is to get a job that overpays you by way too much, fuck it up enough that you get fired, get your golden parachute, then get another job, repeat ad infinitum. We need to do something to fundamentally change the executive culture that has created the current compensation moneygrab that has basically turned these people into a modern-day aristocracy. Does that mean some sort of regulation regarding conflicts of interest between serving as an executive for one company and on the board of trustees for others? Some sort of time limit after leaving an executive job before you can work for another company? Some sort of limitation on golden parachutes? Possibly pay caps? I don't know. But what we have now is much closer to an oligopoly than a competitive free market, and everyone but the lucky few are getting fucked by it.
It's called the Principal-Agent problem, and I've already heard of it in my introduction to macroeconomics class.
This is actually the same thing that caused places such as Enron and WorldCom to collapse: in the '90s, corporations attempted to solve the problem by offering compensation in the form of stock options for CEOs, giving them locked-in prices per share regardless of whether the price of the share went up. As a result, CEOs could make much more money if they inflated, artificially, the perceived value of their company, and thus the stock price. In addition, auditing firms that were supposed to be checking over these companies were in their pocket, too, due to lucrative consulting contracts, and so the inflated value just rose and rose until the dot com bubble burst.
Yeah, the entire executive compensation scheme we have right now basically mandates bad behavior. The system is designed to encourage naughtiness, a significant retooling of how this system works will be necessary unless we want to have "Depression of the Year" contests.
As in "No person in the company can have combined compensation of salary, bonuses, and stocks higher than -for example- 100x the lowest paid employee in the company."
So if you've got a part-time janitor earning the equivalent of 20k/yr? Compensation for the CEO can't be more than 2 million/yr.
To be frank, I'd be fine with this sort of rule to be standard, not just for companies accepting bailout money.
Prepare for some well paid janitors.
Hence the point.
In order to raise the upper end, it is mandatory to also raise the lower end.
The main problem that arises from the above scenario is that you end up having a flattening of the wages at the bottom, then an enormous spike at the top. Not that there isn't that already, but it'd become more skewed without getting into more detail.
However, I think that the principle which states that compensation for the upper end cannot increase without spreading the wealth, so to speak, amongst the employees of the company, who would be more likely to actually need/use the money instead of putting it into various bank accounts? Yeah. I can get behind that.
I sympathize both with the desire to see overcompensated executives "fucked" and with the desire to see assuredly hard-working and underpaid janitors receive laughably big paychecks because their bosses are greedy.
I don't, however, believe that system would do anything to address the core moral hazards plaguing the financial sector, and I believe that should be the focus of any pay-limiting legislation.
I sympathize both with the desire to see overcompensated executives "fucked" and with the desire to see assuredly hard-working and underpaid janitors receive laughably big paychecks because their bosses are greedy.
I don't, however, believe that system would do anything to address the core moral hazards plaguing the financial sector, and I believe that should be the focus of any pay-limiting legislation.
At this point, I would be happy if they just passed the Senator's bill for the federally-supported financial corporations.
As in "No person in the company can have combined compensation of salary, bonuses, and stocks higher than -for example- 100x the lowest paid employee in the company."
The problem with the "you can't make more than $400,000" or "you can't make more than 100x the lowest paid employee" strategy is that this sort of artifice does not solve the actual problem.
It is not the case that Wall Street, under the Bush administration, broke. Rather, Wall Street, under the Bush administration, was allowed to do what Wall Street is structured to do. What we are now seeing is not the dark underbelly of Wall Street; this is not a tainted or corrupt Wall Street. Rather, this is Wall Street. Corporate corruption and green is Wall Street. Citibank buying a $50 Million Private Jet is not corruption of a utopian system. Citibank buying a $50 Million Private Jet is a sensible thing for Citibank to do given what Citibank does.
It is not the case that Wall Street was, for example, a dog and under the Bush administration the dog got rabies. The situation is not that we have to remove from a good thing a tainted and flawed development. Rather, Wall Street is, for example, a gigantic flesh-eating bear. Under the Bush administration the Bear was allowed to eat flesh. What Obama is trying to do is put the gigantic flesh-eating bear into a cage. But it's still a gigantic fucking flesh-eating bear. Wall Street is still a capitalist enterprise motivated by greed.
Because, really, capitalism is little more than systematized greed. That's what is so odd about this entire conversation. Government is trying to harness the power of greed to be such that it can aid the whole. Except no one bothers to question whether or not, maybe, instead of harnessing greed it would behoove us to exclude greed in the first place.
I think a better way of articulating the problem is: "How can we get capitalists to not be greedy?" Because then one may see how asinine the entire enterprise fundamentally is.
As in "No person in the company can have combined compensation of salary, bonuses, and stocks higher than -for example- 100x the lowest paid employee in the company."
The problem with the "you can't make more than $400,000" or "you can't make more than 100x the lowest paid employee" strategy is that this sort of artifice does not solve the actual problem.
It is not the case that Wall Street, under the Bush administration, broke. Rather, Wall Street, under the Bush administration, was allowed to do what Wall Street is structured to do. What we are now seeing is not the dark underbelly of Wall Street; this is not a tainted or corrupt Wall Street. Rather, this is Wall Street. Corporate corruption and green is Wall Street. Citibank buying a $50 Million Private Jet is not corruption of a utopian system. Citibank buying a $50 Million Private Jet is a sensible thing for Citibank to do given what Citibank does.
It is not the case that Wall Street was, for example, a dog and under the Bush administration the dog got rabies. The situation is not that we have to remove from a good thing a tainted and flawed development. Rather, Wall Street is, for example, a gigantic flesh-eating bear. Under the Bush administration the Bear was allowed to eat flesh. What Obama is trying to do is put the gigantic flesh-eating bear into a cage. But it's still a gigantic fucking flesh-eating bear. Wall Street is still a capitalist enterprise motivated by greed.
Because, really, capitalism is little more than systematized greed. That's what is so odd about this entire conversation. Government is trying to harness the power of greed to be such that it can aid the whole. Except no one bothers to question whether or not, maybe, instead of harnessing greed it would behoove us to exclude greed in the first place.
I think a better way of articulating the problem is: "How can we get capitalists to not be greedy?" Because then one may see how asinine the entire enterprise fundamentally is.
Not necessarily. I'm not even necessarily advocating Socialism.
I think the default position in American Politics has been that we have to keep capitalism functioning in this quirky free market plus government restraints pseudo-system of insanity. And I content that maybe instead of constantly trying to cage and restrain this fundamentally flawed economic system there could at least be a brainstorming of other possibilities.
I don't hate capitalism. I simply recognize it for what it is. And it really doesn't make much sense to punish a thing for acting in accord with its nature. Greedy people are greedy. So, yeah, they're going to buy a private jet with taxpayer money. This act is consistent with what capitalism is.
Of course we can make rules to try and prevent that. But then we have this odd phenomena of trying to create a non-greedy system of greed. And that's mostly insane.
Not necessarily. I'm not even necessarily advocating Socialism.
I think the default position in American Politics has been that we have to keep capitalism functioning in this quirky free market plus government restraints pseudo-system of insanity. And I content that maybe instead of constantly trying to cage and restrain this fundamentally flawed economic system there could at least be a brainstorming of other possibilities.
I don't hate capitalism. I simply recognize it for what it is. And it really doesn't make much sense to punish a thing for acting in accord with its nature. Greedy people are greedy. So, yeah, they're going to buy a private jet with taxpayer money. This act is consistent with what capitalism is.
Of course we can make rules to try and prevent that. But then we have this odd phenomena of trying to create a non-greedy system of greed. And that's mostly insane.
Well, it's more trying to channel/limit the greed so it doesn't blow up the whole system like it has here, though I take your point. Basically you want enough regulation to not have this cycle of bubble --> BOOM! --> new bubble --> bigger BOOM! continue but not so much regulation that you stifle the production of wealth. The problem being it's not exactly a stable equilibrium.
enlightenedbum on
Self-righteousness is incompatible with coalition building.
Well, it's more trying to channel/limit the greed so it doesn't blow up the whole system like it has here, though I take your point. Basically you want enough regulation to not have this cycle of bubble --> BOOM! --> new bubble --> bigger BOOM! continue but not so much regulation that you stifle the production of wealth. The problem being it's not exactly a stable equilibrium.
Well, it's a fabricated equilibrium. So, of course it is not stable.
It can be thought of as a car. Cars function by mixing gasoline and fire in a "controlled" setting. We take this fundamentally explosive and dangerous mixture and attempt to restrain it. Capitalism does the same sort of thing. Only instead of gasoline and fire capitalism mixes currency with greed.
I can understand that to some degree the entire human enterprise is an attempt to restrain fundamentally hazardous components into controlled situations. But I still think that one has to maintain the ability to take a step back, so to speak, and realize that the whole fucking situation is insane. I mean, we're trying to control greed. That's just as insane as packing one's family into a steel cage propelled by explosions.
Do I want regulation? I think I would prefer to have a system which does not need to be regulated. But whether or not such a thing exists is up for discussion.
And that's the discussion I'd like for someone in government to have with some other people in government.
Well, it's more trying to channel/limit the greed so it doesn't blow up the whole system like it has here, though I take your point. Basically you want enough regulation to not have this cycle of bubble --> BOOM! --> new bubble --> bigger BOOM! continue but not so much regulation that you stifle the production of wealth. The problem being it's not exactly a stable equilibrium.
Well, it's a fabricated equilibrium. So, of course it is not stable.
It can be thought of as a car. Cars function by mixing gasoline and fire in a "controlled" setting. We take this fundamentally explosive and dangerous mixture and attempt to restrain it. Capitalism does the same sort of thing. Only instead of gasoline and fire capitalism mixes currency with greed.
I can understand that to some degree the entire human enterprise is an attempt to restrain fundamentally hazardous components into controlled situations. But I still think that one has to maintain the ability to take a step back, so to speak, and realize that the whole fucking situation is insane. I mean, we're trying to control greed. That's just as insane as packing one's family into a steel cage propelled by explosions.
Do I want regulation? I think I would prefer to have a system which does not need to be regulated. But whether or not such a thing exists is up for discussion.
And that's the discussion I'd like for someone in government to have with some other people in government.
The problem is that it's not like greed doesn't exist in any other system. The only way to get rid of it entirely would be to completely remove human beings from the equation.
Well, it's more trying to channel/limit the greed so it doesn't blow up the whole system like it has here, though I take your point. Basically you want enough regulation to not have this cycle of bubble --> BOOM! --> new bubble --> bigger BOOM! continue but not so much regulation that you stifle the production of wealth. The problem being it's not exactly a stable equilibrium.
Well, it's a fabricated equilibrium. So, of course it is not stable.
It can be thought of as a car. Cars function by mixing gasoline and fire in a "controlled" setting. We take this fundamentally explosive and dangerous mixture and attempt to restrain it. Capitalism does the same sort of thing. Only instead of gasoline and fire capitalism mixes currency with greed.
I can understand that to some degree the entire human enterprise is an attempt to restrain fundamentally hazardous components into controlled situations. But I still think that one has to maintain the ability to take a step back, so to speak, and realize that the whole fucking situation is insane. I mean, we're trying to control greed. That's just as insane as packing one's family into a steel cage propelled by explosions.
Do I want regulation? I think I would prefer to have a system which does not need to be regulated. But whether or not such a thing exists is up for discussion.
And that's the discussion I'd like for someone in government to have with some other people in government.
The problem is that it's not like greed doesn't exist in any other system. The only way to get rid of it entirely would be to completely remove human beings from the equation.
Yes, you can't stop greed unless you can stop the human instinct to be selfish in order to survive. And that segues into origins of morality, :winky:.
Risks are properly allocated, and risks cannot be passed on to the public. By this I mean that individuals who take risks are responsible for the losses those risks may entail, and no firm is able to pass their losses on to the Feds as we have been recently thanks to Paulson's TARP.
Pay is allocated based on actual long term performance, not temporary number inflation.
Regulatory agencies and rating companies are independent of the firms they regulate or rate.
Really, I think #1 is the big one, #2 and #3 kind of come out of it. Right now Wall Street is allowed to privatize gains and socialize losses. As we are apparently unwilling to force them to eat their losses, you force them to maintain sufficient capital to cover potential losses and create legal liability for executives (unlimited liability, I would argue) if that capital is not maintained. Nothing like "we are taking every thing, every object, every piece of land, every home, every document, every piece of stock, every investment, every fucking cent you fucking own" to motivate stupid rich fuckers to follow the rules.
Obviously the specifics would be far more complicated than what I can paraphrase in a forum paragraph, but basically mandate that any business which is "too big to fail!" act safely enough to not fail, and if it does fail because the people in charge are fuckups, create a legally enforceable liability standard to buttram them (for great justice).
The problem is that it's not like greed doesn't exist in any other system. The only way to get rid of it entirely would be to completely remove human beings from the equation.
Solving problems by removing human beings from the equation? Well now we're into my specialty!
I'm not saying that greed is inherently bad and the goal is to stamp out greed. I'm saying that capitalism as a political philosophy is really little more than systematized greed. Capitalism is about being greedy. The operative mentality for those within a capitalist system is to consume and obtain more. Which, as you know, results in people buying $50 million private jets with taxpayer money. Greedy people in a greed-based system are greedy. Yup.
I think the second post in this thread talked about monetary incentive. Which, oddly enough, lines up with this thing Argus just posted:
Yes, you can't stop greed unless you can stop the human instinct to be selfish in order to survive. And that segues into origins of morality, :winky:.
That’s kind of the question. Is it necessarily the case that selfish self-concern is the operative motivation of the human species? I’m not sure. But I think there are two options:
1) Life is an individualistic endeavor of the one against the many. Life is a selfish competition in which one attempts to sustain one’s self at, if need be, the cost of others.
2) Life is a social enterprise; no one is an island. The farmer produces food. The cobbler produces shoes. No person both farms, cobbles, tailors, and can fully provide for its self.
Capitalism is more in line with option #1 and the capitalist system is built upon that primary assumption of reality. But I remain unconvinced that option #2 is unviable. Moreover, I think that option #2 is more true than option #1. I think that if one let our capitalist system run its course unfettered then it would collapse. When the people buying $50 million jets fuck over the system to the point where people who produce jet fuel can no longer produce jet fuel then the jet can no longer be flown, for example.
I do not think that monetary compensation is necessarily the only possible incentive to be offered for doing one’s job. I do not think that greed needs to be the operative mentality utilized to perpetuate the system.
I think that capitalism sets the problem up to be such that one tends to turn individualistic and think of the self against the many. But what if a system could exist wherein pharmaceutical companies produced medicines for the sake of curing disease? Is that sort of system a unicorn or is it possible?
I think that trudging along in our current system sets ourselves up for the inevitable cyclical history we experience. Maybe we could leave the rut rather than try to make it a slightly better rut.
Dammit, Qingu, you're not going to accomplish anything by telling people they should be paid in food stamps except that people are going to think you're crazy. At this point, I'm not even sure this is hyperbole from you or if you really mean it.
Yes, you can't stop greed unless you can stop the human instinct to be selfish in order to survive. And that segues into origins of morality, :winky:.
That’s kind of the question. Is it necessarily the case that selfish self-concern is the operative motivation of the human species? I’m not sure. But I think there are two options:
1) Life is an individualistic endeavor of the one against the many. Life is a selfish competition in which one attempts to sustain one’s self at, if need be, the cost of others.
2) Life is a social enterprise; no one is an island. The farmer produces food. The cobbler produces shoes. No person both farms, cobbles, tailors, and can fully provide for its self.
Strictly speaking, it would be 1) Pure Capitalism, 2) Pure Communism, 3) Exact mix, 4-on mixed economy of varying degrees.
Well, it's more trying to channel/limit the greed so it doesn't blow up the whole system like it has here, though I take your point. Basically you want enough regulation to not have this cycle of bubble --> BOOM! --> new bubble --> bigger BOOM! continue but not so much regulation that you stifle the production of wealth. The problem being it's not exactly a stable equilibrium.
Well, it's a fabricated equilibrium. So, of course it is not stable.
It can be thought of as a car. Cars function by mixing gasoline and fire in a "controlled" setting. We take this fundamentally explosive and dangerous mixture and attempt to restrain it. Capitalism does the same sort of thing. Only instead of gasoline and fire capitalism mixes currency with greed.
I can understand that to some degree the entire human enterprise is an attempt to restrain fundamentally hazardous components into controlled situations. But I still think that one has to maintain the ability to take a step back, so to speak, and realize that the whole fucking situation is insane. I mean, we're trying to control greed. That's just as insane as packing one's family into a steel cage propelled by explosions.
Do I want regulation? I think I would prefer to have a system which does not need to be regulated. But whether or not such a thing exists is up for discussion.
And that's the discussion I'd like for someone in government to have with some other people in government.
The problem is that it's not like greed doesn't exist in any other system. The only way to get rid of it entirely would be to completely remove human beings from the equation.
Finally! A plan I can get behind.
Sentry on
[SIGPIC][/SIGPIC]
wrote:
When I was a little kid, I always pretended I was the hero,' Skip said.
'Fuck yeah, me too. What little kid ever pretended to be part of the lynch-mob?'
"I think President Obama painted everyone with a broad stroke," said Brian McCaffrey, 55, a Wall Street lawyer who was on his way to see a client. "The way we pay our taxes is bonuses. The only way that we’ll get any of our bailout money back is from taxes on bonuses. I think bonuses should be looked at on a case by case basis, or you turn into a socialist."
That, indeed, was a recurring equation: Broad strokes + bonuses = socialist.
"It’s a very slippery slope to go down," said another insurance broker as he waited to be seated for lunch at Cipriani Downtown. "A blanket statement like that borders on" — you guessed it — "socialism."
It's great when the government bails out their companies, but take away their personal money? Then it's socialism. Fuck them.
enlightenedbum on
Self-righteousness is incompatible with coalition building.
Posts
I wonder what malady is addling your brain to allow this sort of argument seem reasonable at all unless you truly are a corporatist. You are taking money that is going to be paid for by ballooning the federal debt, so by taxes later or inflation, then giving it to a financial executive who ran his company in the ground not necessarily to save the company, but rather allow him to buy a whole bunch of overpriced shit just for the sake of protecting the overpriced shitmongerers.
If you are so infatuated with overpriced shitmongerers, just cut out the middleman and buy some overpriced shit for the government for public use. Or for local taxation, just aid the state government directly.
Pretty much this.
If the tables were turned, if it were the corporations handing out free money to citizens and then attaching stipulations to that money, the pro-big-business folks would be shrugging their shoulders and saying, "Their money, their rules."
the "no true scotch man" fallacy.
It's time for some goddamn class warfare on the rich.
No.
Really, when we're talking about banks that are being propped up by federal dollars, I'm all for salary caps. But in the private sector, there should be no caps. Simply put, if you're doing a great job running your business, then you should receive whatever they are willing to pay you.
The problem this time around is that the folks who were voting (stockholders) weren't paying good enough attention, and the banks were being shady (all sorts of false information, lack of transparency, etc). Work on those issues... you don't need salary caps.
So you're arguing for a pay cap on executive pay all the time, and for all companies instead of just the ones receiving taxpayer money because you feel that the market cannot control the system? I don't want to strawman but that is the position that fits in well with that quote.
To put it simply, the boards who have that kind of philosophy are going to go under in bad time or be forced to go onto corporate welfare, as many of the big firms have been. The problem is solved if the government takes care of its own money.
What I'm saying is that something needs to be done about the "revolving door" phenomenon in the executive sector; the current strategy is to get a job that overpays you by way too much, fuck it up enough that you get fired, get your golden parachute, then get another job, repeat ad infinitum. We need to do something to fundamentally change the executive culture that has created the current compensation moneygrab that has basically turned these people into a modern-day aristocracy. Does that mean some sort of regulation regarding conflicts of interest between serving as an executive for one company and on the board of trustees for others? Some sort of time limit after leaving an executive job before you can work for another company? Some sort of limitation on golden parachutes? Possibly pay caps? I don't know. But what we have now is much closer to an oligopoly than a competitive free market, and everyone but the lucky few are getting fucked by it.
Generally speaking, profits are privatized and losses are nationalized. A bank that makes $100B profit for three years and on year four is $500B in the red has averaged a net loss of $200B over four years. However, executive and employee compensation won't be based on that final number, it will be based on the number of the day. This encourages faulty lending and high-risk business practices. Why in the world should you play it safe and responsible if you keep anything you win and everyone else pays if you lose?
All this "free market" nonsense can kindly fuck off. Banks aren't a free market, and they haven't been during any of our lifetimes. They operate with all sorts of government protection and guarantees. The cost of that protection, of those guarantees, and of being allowed to participate in a business where failure is incredibly detrimental to the well-being of our United States is putting up with some rules to prevent you from assfucking the rest of America. I don't know if pay caps are an optimal solution or even the best one, but we're well past the point where "LOLOLOL FREE MARKET FREE MARKET!" means a goddamn thing.
but they're listening to every word I say
Socialism socialism lol lol!
That's about it. Nationalizing the failed banks while wiping out shareholders is probably the most cost-effective, fastest, most-direct, and economically safest option we have right now. We're drifting towards socialized banks with private executives, which is all kinds of terrible and might be one of the most spectacular moral hazards in history, at least in dollar terms.
Because "government makes a poor bank manager" according to Geithner and Larry Summers who inexplicably has the ear of the President despite being a grade A moron who helped us get into this mess.
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I suspect it has more to do with a public relations fear that nationalizing the banks will bring about the mediapocolypse, but it is unfortunate to see so many familiar names making so many familiar mistakes in the economy.
I feel like there might be some problems with this idea.
Jackson more killed it because he was a stupid asshole, but yes. Also we already have a central bank in this country, we just call it the Federal Reserve.
No institution is uniquely immune to corruption, but it would be far easier to force a nationalized bank to work in the public's best interest than it would be to force a privatized one.
Further, my favorite idea has been temporary nationalization until the bank is no longer toxic, at which point it is resold to the private sector. Essentially acknowledging that segments of the financial sector have become so corrupt and mismanaged that they cannot function on their own and must be temporarily gutted and reconstructed by the Feds in order to function. I'm not against a permanent socialized banking institution, but I don't think it would be significantly better than a well-managed, properly regulated private banking institution.
Nationalizing the whole banking sector however, seems like a pretty terrible idea. With the current bailout plan the government already has a way to strong arm their position and I'm not sure full nationalization would send the right message to the economy.
Also, the argument that "our best performers won't stand for the bonus freeze" made me laugh.
As in "No person in the company can have combined compensation of salary, bonuses, and stocks higher than -for example- 100x the lowest paid employee in the company."
So if you've got a part-time janitor earning the equivalent of 20k/yr? Compensation for the CEO can't be more than 2 million/yr.
To be frank, I'd be fine with this sort of rule to be standard, not just for companies accepting bailout money.
It's called the Principal-Agent problem, and I've already heard of it in my introduction to macroeconomics class.
This is actually the same thing that caused places such as Enron and WorldCom to collapse: in the '90s, corporations attempted to solve the problem by offering compensation in the form of stock options for CEOs, giving them locked-in prices per share regardless of whether the price of the share went up. As a result, CEOs could make much more money if they inflated, artificially, the perceived value of their company, and thus the stock price. In addition, auditing firms that were supposed to be checking over these companies were in their pocket, too, due to lucrative consulting contracts, and so the inflated value just rose and rose until the dot com bubble burst.
I don't know if anyone is seriously forwarding total nationalization as an argument, some of us (myself included) are saying partial (and probably temporary) nationalization in order to handle the toxic firms is probably the idea way to go.
Prepare for some well paid janitors.
Yeah, the entire executive compensation scheme we have right now basically mandates bad behavior. The system is designed to encourage naughtiness, a significant retooling of how this system works will be necessary unless we want to have "Depression of the Year" contests.
Hence the point.
In order to raise the upper end, it is mandatory to also raise the lower end.
The main problem that arises from the above scenario is that you end up having a flattening of the wages at the bottom, then an enormous spike at the top. Not that there isn't that already, but it'd become more skewed without getting into more detail.
However, I think that the principle which states that compensation for the upper end cannot increase without spreading the wealth, so to speak, amongst the employees of the company, who would be more likely to actually need/use the money instead of putting it into various bank accounts? Yeah. I can get behind that.
I don't, however, believe that system would do anything to address the core moral hazards plaguing the financial sector, and I believe that should be the focus of any pay-limiting legislation.
At this point, I would be happy if they just passed the Senator's bill for the federally-supported financial corporations.
The problem with the "you can't make more than $400,000" or "you can't make more than 100x the lowest paid employee" strategy is that this sort of artifice does not solve the actual problem.
It is not the case that Wall Street, under the Bush administration, broke. Rather, Wall Street, under the Bush administration, was allowed to do what Wall Street is structured to do. What we are now seeing is not the dark underbelly of Wall Street; this is not a tainted or corrupt Wall Street. Rather, this is Wall Street. Corporate corruption and green is Wall Street. Citibank buying a $50 Million Private Jet is not corruption of a utopian system. Citibank buying a $50 Million Private Jet is a sensible thing for Citibank to do given what Citibank does.
It is not the case that Wall Street was, for example, a dog and under the Bush administration the dog got rabies. The situation is not that we have to remove from a good thing a tainted and flawed development. Rather, Wall Street is, for example, a gigantic flesh-eating bear. Under the Bush administration the Bear was allowed to eat flesh. What Obama is trying to do is put the gigantic flesh-eating bear into a cage. But it's still a gigantic fucking flesh-eating bear. Wall Street is still a capitalist enterprise motivated by greed.
Because, really, capitalism is little more than systematized greed. That's what is so odd about this entire conversation. Government is trying to harness the power of greed to be such that it can aid the whole. Except no one bothers to question whether or not, maybe, instead of harnessing greed it would behoove us to exclude greed in the first place.
I think a better way of articulating the problem is: "How can we get capitalists to not be greedy?" Because then one may see how asinine the entire enterprise fundamentally is.
Are you advocating Communism, then?
Not necessarily. I'm not even necessarily advocating Socialism.
I think the default position in American Politics has been that we have to keep capitalism functioning in this quirky free market plus government restraints pseudo-system of insanity. And I content that maybe instead of constantly trying to cage and restrain this fundamentally flawed economic system there could at least be a brainstorming of other possibilities.
I don't hate capitalism. I simply recognize it for what it is. And it really doesn't make much sense to punish a thing for acting in accord with its nature. Greedy people are greedy. So, yeah, they're going to buy a private jet with taxpayer money. This act is consistent with what capitalism is.
Of course we can make rules to try and prevent that. But then we have this odd phenomena of trying to create a non-greedy system of greed. And that's mostly insane.
Well, it's more trying to channel/limit the greed so it doesn't blow up the whole system like it has here, though I take your point. Basically you want enough regulation to not have this cycle of bubble --> BOOM! --> new bubble --> bigger BOOM! continue but not so much regulation that you stifle the production of wealth. The problem being it's not exactly a stable equilibrium.
Well, it's a fabricated equilibrium. So, of course it is not stable.
It can be thought of as a car. Cars function by mixing gasoline and fire in a "controlled" setting. We take this fundamentally explosive and dangerous mixture and attempt to restrain it. Capitalism does the same sort of thing. Only instead of gasoline and fire capitalism mixes currency with greed.
I can understand that to some degree the entire human enterprise is an attempt to restrain fundamentally hazardous components into controlled situations. But I still think that one has to maintain the ability to take a step back, so to speak, and realize that the whole fucking situation is insane. I mean, we're trying to control greed. That's just as insane as packing one's family into a steel cage propelled by explosions.
Do I want regulation? I think I would prefer to have a system which does not need to be regulated. But whether or not such a thing exists is up for discussion.
And that's the discussion I'd like for someone in government to have with some other people in government.
Yes, you can't stop greed unless you can stop the human instinct to be selfish in order to survive. And that segues into origins of morality, :winky:.
The Science of Good and Evil, by Michael Shermer
Risks are properly allocated, and risks cannot be passed on to the public. By this I mean that individuals who take risks are responsible for the losses those risks may entail, and no firm is able to pass their losses on to the Feds as we have been recently thanks to Paulson's TARP.
Pay is allocated based on actual long term performance, not temporary number inflation.
Regulatory agencies and rating companies are independent of the firms they regulate or rate.
Really, I think #1 is the big one, #2 and #3 kind of come out of it. Right now Wall Street is allowed to privatize gains and socialize losses. As we are apparently unwilling to force them to eat their losses, you force them to maintain sufficient capital to cover potential losses and create legal liability for executives (unlimited liability, I would argue) if that capital is not maintained. Nothing like "we are taking every thing, every object, every piece of land, every home, every document, every piece of stock, every investment, every fucking cent you fucking own" to motivate stupid rich fuckers to follow the rules.
Obviously the specifics would be far more complicated than what I can paraphrase in a forum paragraph, but basically mandate that any business which is "too big to fail!" act safely enough to not fail, and if it does fail because the people in charge are fuckups, create a legally enforceable liability standard to buttram them (for great justice).
Solving problems by removing human beings from the equation? Well now we're into my specialty!
I'm not saying that greed is inherently bad and the goal is to stamp out greed. I'm saying that capitalism as a political philosophy is really little more than systematized greed. Capitalism is about being greedy. The operative mentality for those within a capitalist system is to consume and obtain more. Which, as you know, results in people buying $50 million private jets with taxpayer money. Greedy people in a greed-based system are greedy. Yup.
I think the second post in this thread talked about monetary incentive. Which, oddly enough, lines up with this thing Argus just posted:
That’s kind of the question. Is it necessarily the case that selfish self-concern is the operative motivation of the human species? I’m not sure. But I think there are two options:
1) Life is an individualistic endeavor of the one against the many. Life is a selfish competition in which one attempts to sustain one’s self at, if need be, the cost of others.
2) Life is a social enterprise; no one is an island. The farmer produces food. The cobbler produces shoes. No person both farms, cobbles, tailors, and can fully provide for its self.
Capitalism is more in line with option #1 and the capitalist system is built upon that primary assumption of reality. But I remain unconvinced that option #2 is unviable. Moreover, I think that option #2 is more true than option #1. I think that if one let our capitalist system run its course unfettered then it would collapse. When the people buying $50 million jets fuck over the system to the point where people who produce jet fuel can no longer produce jet fuel then the jet can no longer be flown, for example.
I do not think that monetary compensation is necessarily the only possible incentive to be offered for doing one’s job. I do not think that greed needs to be the operative mentality utilized to perpetuate the system.
I think that capitalism sets the problem up to be such that one tends to turn individualistic and think of the self against the many. But what if a system could exist wherein pharmaceutical companies produced medicines for the sake of curing disease? Is that sort of system a unicorn or is it possible?
I think that trudging along in our current system sets ourselves up for the inevitable cyclical history we experience. Maybe we could leave the rut rather than try to make it a slightly better rut.
Strictly speaking, it would be 1) Pure Capitalism, 2) Pure Communism, 3) Exact mix, 4-on mixed economy of varying degrees.
So why not just push it in general towards command economy without going all the way, like European countries?
Finally! A plan I can get behind.
It's great when the government bails out their companies, but take away their personal money? Then it's socialism. Fuck them.
Isn't that just, you know, a salary?