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

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

#181

Post by pdkl95 »

jbooth wrote: post #28
projectramo wrote: post #18

There is a theory that all above market profits are generated by government granted monopolies. So, for instance, software is protected by patents, oil and gas is protected by mineral rights, drugs are protected by patent law, entertainment is protected by IP rights, and so on. In so far as there is competition, it often arises when the rent-seeking motivates people to disrupt the government protection by making it u…

That theory falls under the Econ 101 fallacy -- assuming perfect information dispersal, instant job-switching, instant production ramping.. "First, let's assume the cow is a sphere".

> "First, let's assume the cow is a sphere".

"There is a story that has been going around about a physicist, a chemist, and an economist who were stranded on a desert island with no implements and a can of food. The physicist and the chemist each devised an ingenious mechanism for getting the can open; the economist merely said, 'Assume we have a can opener'!"[1]

Yanis Varoufakis, after the drama surrounding his (very) brief term as Greek's Minister of Finance describes[2] the problem simply and plainly: "Understanding economics well impedes an understanding the economy." His continued explanation why [ibid] might be the ultimate example of how easy it is to sell bullshit as long as you dress it up properly with the trappings of math/stat/logic.

[1] https://en.wikipedia.org/wiki/Assume_a_can_opener

[2] https://www.youtube.com/watch?v=L5AUAIzciLE#t=1355

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

#182

Post by harryh »

Retric wrote: post #178
harryh wrote: post #145

Earlier quoted context omitted.

- 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 1…

1) I expect that if we included state and local taxes the story would be much the same, though I don't have a graph handy. You could be right I suppose.

2) I think we mostly agree here. There have definitely been meaningful changes both up and down (on the order of 20%) over the years depending on both economic and political changes. However, when you look over a 50 year timespan (everything post WW2 basically), you don't really see a meaningful longitudinal change. To me this refutes the OPs point about taxation being meaningfully different in the "olden days."

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

#183

Post by grasshopperpurp »

Shivetya wrote: post #126
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…

taxes in the US are far more progressive than they used to be. there are however many new avenues to follow to increase wealth. those below a certain income level are more likely to get eaten up by embedded taxes, regulatory fees and government service fees. then throw in we are bombarded every day continuously to buy this,buy that, go here, do that. We get told every day of wonderful stuff available for pennies or d…

"taxes in the US are far more progressive than they used to be."

How do you figure? Between 1936 and 1989, the tax rate for the top income bracket varied between 63% and 91%.

https://qz.com/74271/income-tax-rates-since-1913/

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

#184

Post by sharemywin »

bostonscott wrote: post #155
bjl wrote: post #87

Earlier quoted context omitted.

> You will find no practical solution to this problem other than starving the beast (decentralizing power away from government) All this will lead to is dictatorship by the wealthy. I much prefer our current system, as flawed as it is, to corporate fascism.

Disagree. It is our current system, which increasingly empowers opportunists over capitalists, that will create "corporate fascism." Current system: 1) Big companies pay minimal or negative taxes. Small companies are taxed at the individual rate (and increasing). If Company A pays 0% at top bracket, and Company B pays 50%, Company B is unlikely to out-compete Company A. Read: our tax system creates "monopolies." 2) O…

1. Competition drives down prices and profits.

2. Restated, monopolies earn more short term profits than companies in a competitive market.

3. stock investors look to maximize short term profits.

4. stock investors are offering a premium for monopolistic companies.

5. The stock market is rewarding this behavior without government intervention.

"starving the beast" will just feed another beast.

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

#185

Post by mercurial »

acabal wrote: post #154
mercurial wrote: post #128

Earlier quoted context omitted.

> There's historic precedent for that kind of divorce between actions and consequences, and it is not pretty. There's a certain French doctor you should google: his name's Josheph Guillotin. I'm not sure what analogy you are going for. Guillotin did not invent the guillotine, and only advertised it as a more humane way of execution. He was opposed to the death penalty.

They're referring to the French Revolution, and then the Terror. One of the causes of the revolution was the poor being fed up with the massive wealth imbalance. An economic depression was making the masses starve in the streets, while the wealthy 1% enjoyed lives of comfort and luxury enabled by the rigged aristocratic land-owning system. So the peasants had their bloody revolution, killed a lot of the aristocrats u…

I am well aware of the French revolution and its causes, thank you. As I said, Guillotin did not invent the machine. He did not like death penalty, but if it had to be done, he would rather have had it done by a machine than by axe or sword (for the nobility) which occasionally did not kill in one hit, or by hanging (for the ordinary populace).

The actual inventor of the guillotine is one Antoine Louis [1].

1: https://en.wikipedia.org/wiki/Antoine_Louis

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

#186

Post by mcguire »

refurb wrote: post #147
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…

any money paid by the very wealthy had to go somewhere, and that somewhere was the masses What? The size of gov't has only increased over time. That's money being pulled out of the economy through taxes. If anything redistribution has drastically increased over time.

"That's money being pulled out of the economy through taxes."

That money goes straight back into the economy.

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

#187

Post by Retric »

harryh wrote: post #182
Retric wrote: post #178

Earlier quoted context omitted.

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 1…

1) I expect that if we included state and local taxes the story would be much the same, though I don't have a graph handy. You could be right I suppose. 2) I think we mostly agree here. There have definitely been meaningful changes both up and down (on the order of 20%) over the years depending on both economic and political changes. However, when you look over a 50 year timespan (everything post WW2 basically), you…

2) He was not talking about total recites. And the top tax rates are a very different story: https://www.cch.com/WBOT2013/029IncomeTaxRates.asp

PS: IMO, a ~1 to 2% AMT on all wealth per year would be incredibly beneficial. But, there is currently about zero chances of that ever happening.

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

#189

Post by dudul »

marcosdumay wrote: post #136
dudul wrote: post #51

Not native english speaker here. My comment is probably of very limited value, but mostly for my personal improvement :). When I read "the wrong kind of entrepreneurs flourish in America" it surprises me to not see: "the wrong kind of entrepreneurs flourishes in America". I understand that "kind" should be the subject of the sentence, not the entrepreneurs. I have seen this construct several times (e.g. "this type of…

Out of curiosity, are you native to an western language? I think this kind of inversion is common on Latin languages too.

I'm a native latin language speaker indeed. I've seen this type of inversion in the past true, but not as frequently as I hear/read them in English.

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

#190

Post by wott »

dudul wrote: post #189
marcosdumay wrote: post #136

Earlier quoted context omitted.

Out of curiosity, are you native to an western language? I think this kind of inversion is common on Latin languages too.

I'm a native latin language speaker indeed. I've seen this type of inversion in the past true, but not as frequently as I hear/read them in English.

Both constructs are now allowed in French. The singular follows more the grammar rule, the plural conveys more the meaning and is often a little bit more natural, so it got allowed.
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