The Financialization of the American Elite

The economic system that causes people to work harder will win. To be a challenger to capitalism you need to be serious about getting people to work, and not dream about a society where 90% of people are in the leisure class. Such a society would be defeated by capitalism again.

So how do you get people to work? Such a system must respect private property rights. You're DOA if you don't.

The main flaw in capitalism is in the name: it's a legal system that favors capital. Given that the holders of capital are few, this is a massive market distortion. What is an "undistorted" market? If your cost function is getting more people to work so that your society is more efficacious, and we know that most people are in the middle along whatever dimension you measure, then a system that favors the middle - because that's where the people are - rather than the right tail is better. The US briefly had such a system in the postwar era.

Some may argue that because the right tail individuals are more talented, we should just keep rewarding them as they are more efficient. That ignores that these people's time is limited, and at some point you get diminishing returns. We are way past that point.

How do you favor the middle? The middle plays by the rules, so you need to enforce those rules and prevent elites from changing those rules. This means first and foremost campaign finance reform, up to and including public funding of political campaigns and a ban on political donations.

This is the hard part. The middle will never be as politically savvy and engaged as the elites. For the middle, the political system is exogenous. Thus making it as exogenous as possible for the elites is necessary.

A middle class society can defeat an elitist society because it mobilizes more people. Parliament defeated the king.

We need to stop obsessing about the modern right-left divide that has been in place since Marx first appeared. Marx got it wrong by focusing on exploitation of one class extreme by its opposite class extreme. He should have been thinking about maximum middle class mobilization if he wanted to replace capitalism.

Instead use our knowledge of the normal distribution of human ability to empower the middle where most people are. This may be a tough pill to swallow, but we need to accept that political engagement is not the middle class's strength. Therefore the more intrusive politics becomes, the more the middle gets sidelined by those who are adept at politics, whatever their alignment.

Democracy is a fabulous way to empower the middle class, since the middle class is numerous. We need more democracy, not less, and that democracy should be more expansive and not "guided" by bureaucracy. This is a huge blind spot among a certain set nowadays.

A market economy and a political system that favors the middle class over both the first and fourth quartiles could defeat our current system. Maybe you still call that capitalism... that's just a label to me.

Capitalism is fine but this is not capitalism.

The real cuplerate is that when a bank creates a loan it creates a loan check, and through a confluence of politics and leverage, businesses are motivated to use other people's money to make investments and pay only the interest. As the sum of the interest on accumulated loan checks build, you end up reducing the velocity of capital (people's willingness to spend money) because eveything becomes too expensive due to price reflecting the businesses load of interest, until, eventually, you end up with a liquidity problem; too many loan checks and promises, to little returns, and cash evaporates. Everything becomes too expensive when resold through the bank a dozen times.

Governments have tried every system known to man kind to constrain this including war and genocide. The Privately-owned federal reserve has in their corporate charter a requirement to keep steady interest rates and they refuse to maintain them; The 2% yearly inflation is artificially caused by the continuous expansion of credit and prices never correct or deflate because they always capture the correction by printing or lending ever larger sums of money they never intend to collect. They disregard their charter and do whatever they want because they have the money to do so.

By having this monetary policy, you enable equity pirates, often led and initially funded by foreign countries who harbor the viewpoint that enslaving and killing your population is no big deal, to expend vast sums of capital asset stripping everything; businesses, machinery, people, equipment. Fertility rates are down to 1.7 today in the US; when the USSR collapsed they were down to 1.2. 2.1 is replacement. You have 60-100 million men who will never have kids or get married if GAO Retirement security studies are to be believed; they break out demograhics in some of those studies and there's a double digit and growing demographic of men who cannot make enough money by the age of 45 to have a family. Over 50% of female Latino immigrants (illegal or otherwise) do not have kids. Some of that is 3rd wave feminism (half of men with an 80th percentile income or higher never procreate, and a lot of that is, when you have money, girls throw themselves at you, and you lose respect for all women due to that). CDC had a statistic SJW's forced them to take down in 2011; quarter of women with bachleors degree's don't have kids (her school debts become a dowry most men can't pay), but a heck of a lot of it is profit motive. Turning people into products for corporate executives also turns them into trash once you've consumed them; you take from them the concept of self respect and dignity, and as we've found with C-PTSD research, once the structure of the brain has changed due to trauma, it takes a large investment of time and energy to get it back to normal. Historically, People who do not have those concepts don't know how to engineer a society with those values which is how you get the pattern of the french revolution and subsequent reign of terror repeating thoughout history so often.

There's 2 ways you constrain this.

The first is bankruptcy. You shred the loan checks and let the rot fall out of the system.

The second is by limiting the revenue of private companies through income tax like we did in the 60's; you make more than 250k a year congrats you've won the game, every dollar you make more is going to be taxed. Now. Go do something nice for society. You also require public companies to have 66% or more their stock owned by employee's. Doesn't have to be voting stock, but total stock and allocation of revenue. We figured out in the 30's when you pay people a "keep what you catch" wage, they work really hard and efficiently and when the downturn comes, they stick with the company and survive it well then on the upswing, they invest. If constrains who goes bankrupt during the boom\bust cycle.

Getting there, however, means putting a lot of executives and rich people in jail (for fraud, so they can't keep comitting fraud or spending their money to interfere with the process), and pruning a lot of large companies. It also means widespread rehabilitiation and family education and planning resources. We are well over the point where all of that can snowball into a violent political revolution; the consequences of that is are all bad.