Crony capitalism may be cannibalizing productive capitalism in the U.S. • Hacker News Board

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#171

Post by dv_dt » Fri, Jun 23, 2017, 6:13 PM UTC

mowenz wrote: post #48

dv_dt wrote: post #27

Does it seem to anyone else that the finance industry is increasingly distracted from actually matching up capital to fundamentally productive companies, especially new companies? Looking at the stock market, there are few IPOs, and after IPO, being public only provides access to limited access vis issuance of new stock... Some capital flows to VCs, but it seems the more capital flows to large VC funds, the more the…

>Does it seem to anyone else that the finance industry is increasingly distracted from actually matching up capital to fundamentally productive companies, especially new companies? This is somewhat controversial to posit, but I believe the corruption in the financial industry is extraordinarily entrenched because of the Fed. Before you call me a lunatic, smart and good people from Aaron Schwartz to Sanders have said…

I think this is something of a serious issue, but I was thinking more of problems in the operation of our financial markets in a straightforward legal sense.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#172

Post by johngalt » Fri, Jun 23, 2017, 6:14 PM UTC

crpatino wrote: post #84

rm_-rf_slash wrote: post #44

Earlier quoted context omitted.

Or simply, our means of production have become so efficient that it didn't matter whether you were right or wrong, things would still hum along and the profits would continue. In the agricultural age, if you fucked up a harvest, you and your family could starve. Before agriculture, if you fucked up a hunt, your whole kin-clan could starve. Nowadays, if you fuck up the housing market, and millions of people go bankrup…

It is not that we are so efficient, but that a priviledged tiny cabal have learned how to push the consequences of their mistakes to the rest of the population. To borrow your example: In agricultural age, if you fucked up harvest your family starves. Today, if you fuck up the housing market, thousand of families end up in bankrupcy, and tens of thousands of small investors loose their savings... but you do not perso…

Wouldn't Robespierre be a better example than Guillotin?

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#173

Post by emodendroket » Fri, Jun 23, 2017, 6:15 PM UTC

> Regulation could be a big drag as well. Eager both to shield workers from obsolescence and to appease corporate lobbyists, many U.S. states have enacted laws to protect established industries from new market entrants. Some states forbid car companies from selling directly to buyers, while others protect credit-card companies by banning retailers from passing on swipe fees. Though one study has cast doubt on federal regulation’s role in reduced entrepreneurial dynamism, state regulation could be a much bigger deal.

I'd contend the opposite seems more likely; we've deregulated a lot of stuff, including, perhaps significantly, getting really lax on antitrust legislation. Consolidation and subsequent rent-seeking is the typical result of unregulated market economies.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#174

Post by ThomPete » Fri, Jun 23, 2017, 6:16 PM UTC

Why is this title changed? The correct title is "The Wrong Kind of Entrepreneurs Flourish in America" which was also up in the beginning.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#175

Post by voice_of_reason » Fri, Jun 23, 2017, 6:19 PM UTC

mowenz wrote: post #100

voice_of_reason wrote: post #67

Earlier quoted context omitted.

"Before you call me a lunatic" You're very close to being a lunatic and conspiracy theorist, sir. "This is somewhat controversial to posit, but I believe the corruption in the financial industry is extraordinarily entrenched because of the Fed." After TARP and bailouts it's not controversial at all.

The former and latter comments of yours in this post don't appear to agree with each other. Am I missing something?

The first part is sarcastic. It's a shame that you have to resort to "preventive self-denigrating" when voicing valid concerns about the FRS, which is basically a facade for a bunch of crooks who usurped the control over US money supply.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#176

Post by vkou » Fri, Jun 23, 2017, 6:19 PM UTC

refurb wrote: post #153

rtx wrote: post #81

Earlier quoted context omitted.

Thats why we need space colonization. We as a species are programmed to expand. We have become stagnant in the last 100 years.

We have become stagnant in the last 100 years. Are you serious? Do you know how much mankind has accomplished since 1917?

They should go to India, or China, or Vietnam, or Nigeria, and, with a straight face, tell people there that we've become stagnant over the last century.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#177

Post by mtberatwork » Fri, Jun 23, 2017, 6:22 PM UTC

bjl wrote: post #54

saas_sam wrote: post #37

It's interesting to me how this article frames crony capitalism as a use or abuse of government by corporations, almost as if the government is a victim. But it's the government that has all of the power in this context. There's something to be said for corporate money influencing elections, but even there it's elected officials who are deciding on policies after getting there, and if they are making decisions based…

Knowingly providing incentives for people to do something unethical is itself unethical. The corporations aren't blameless here.

Indeed, this is even outlined in the infamous Powell memo: "Business must learn the lesson ... that political power is necessary; that such power must be assiduously cultivated; and that when necessary, it must be used aggressively and with determination—without embarrassment and without the reluctance which has been so characteristic of American business." [1]

[1] http://billmoyers.com/content/the-powell-memo-a-call-to-arms...

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#178

Post by Retric » Fri, Jun 23, 2017, 6:23 PM UTC

harryh wrote: post #145

zackmorris wrote: post #39

I think the great problem of our time is that the challenges get easier to solve every day but we mostly spend our time making rent. And not the kind of rent mentioned in the article - just plain old fashioned too-much-month-not-enough-money kind of rent. When we’re desperate, we grovel and do whatever work we need to to survive. This is akin to how researchers spend inordinate amounts of time applying for grants rat…

- There is plenty of free capital in the economy. More than ever really. To the point that the "capital glut" is a regular topic of discussion in economic news. - I don't know how old you are but both Clinton and Obama significantly increased taxes on the rich. Federal tax receipts as a % of GDP are fairly constant going back to WW2. https://fred.stlouisfed.org/series/FYFRGDA188S

First that graph shows a huge range of rates. Just 2000 vs 2004 is a 22% drop, but even that's just federal rates. Total government spending is the only meaningful metric when state, local, and federal funds are all taken out of your paycheck.

Further, not being static does not mean it was ever meaningfully increased. The rate from 1982 was higher than either Clinton or Obama rates. And 1982 was below the rate from 1932 to 1981. Compare US GDP growth and a high top marginal rate seems to promote growth, though there are many ways to slice and dice these numbers.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#179

Post by JamesBarney » Fri, Jun 23, 2017, 6:23 PM UTC

emodendroket wrote: post #173

> Regulation could be a big drag as well. Eager both to shield workers from obsolescence and to appease corporate lobbyists, many U.S. states have enacted laws to protect established industries from new market entrants. Some states forbid car companies from selling directly to buyers, while others protect credit-card companies by banning retailers from passing on swipe fees. Though one study has cast doubt on federal…

Which large corporations are involved in rent seeking, and you think would have been broken up under previous regulatory reigmes?

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#180

Post by dv_dt » Fri, Jun 23, 2017, 6:23 PM UTC

harryh wrote: post #145

zackmorris wrote: post #39

I think the great problem of our time is that the challenges get easier to solve every day but we mostly spend our time making rent. And not the kind of rent mentioned in the article - just plain old fashioned too-much-month-not-enough-money kind of rent. When we’re desperate, we grovel and do whatever work we need to to survive. This is akin to how researchers spend inordinate amounts of time applying for grants rat…

- There is plenty of free capital in the economy. More than ever really. To the point that the "capital glut" is a regular topic of discussion in economic news. - I don't know how old you are but both Clinton and Obama significantly increased taxes on the rich. Federal tax receipts as a % of GDP are fairly constant going back to WW2. https://fred.stlouisfed.org/series/FYFRGDA188S

Tax receipts are largely on income flows, but capital (wealth) itself is much more imbalanced than even the gilded age.

Economic inequality has collected a huge amount of capital into very few hands that ultimately don't seem to know how to apply it productively over the whole system.