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It’s a pun off of the word stagflation which was short for stagnant inflation. Stagpression is short for stagnant depression. It is the most accurate indicator of our economic situation today, and tomorrow, and tomorrow, and tomorrow…
We seem to be in a Depression. but we aren’t. The Housing market is recouping, jobs are consistently growing, energy costs have dropped, corporate profits are now at record, higher than just before the 1929 crash, and an all time record high stock market.. We should be booming. But we aren’t. We still have too high of an unemployment both on and off the books, we still have depressed low wages, we have lost massive wealth within the middle class over this century so far, we have record high student loan debt, we have low consumer confidence, Hence, one class of America is booming. The other class is still in Depression mode. Hence we are in Stagpression….
It is easy to see why.
Here is a chart showing the free cash flow of businesses……
Record highs. See? Record highs. We should be growing faster than China, we have so much investment money at our fingertips. But no.
Here is our investment track record…
Ironically as we gave our businesses more and more money with lower taxes, less regulation, tax funded price supports, hand-tied their unions, and made free new technology at our taxpayers expense, despite all these perks and incentives, they invested less. So what are they doing with their money? Pick up any financial publication and read the headlines. They all will let you know.
None of which help our economy. It is as if we work hard, buy their products, and they put that money into a mattress. Soon, we are going to run out of money. Fortunately the Fed has filled the gap by printing more and giving it to banks for free. It too, filters though the system, and when it gets to the top, it goes into the mattress.
Instead of recycling money, we are letting the tap flow from our printing presses to the top echelon of our society… Now do you get it?
What is missing is a system that recycles the materials back into our economy so we have less money we need to print. If we were talking about paper, we would be saying we need to recycle paper to keep from cutting down more and more trees simply to fill up our landfills….
We need a system to return that money to the bottom so it can rise again and again and again.
Here are the options that have been tried.
- Price and pay freezes.
- Government set and regulated prices.
- Lower tax rates.
- Cash incentives from taxpayers to reinvest.
- Pleas and entreaties from the Oval Office.
- Higher marginal tax rates.
Only one of these has worked. Can you guess which one? If you guessed higher tax rates spur reinvestment you are absolutely correct.
Notice the rates of reinvestment climbing in each of these presidencies: Eisenhower, Kennedy-Johnson, Carter, Clinton each time Congress legislated higher marginal tax rates. Also notice the drops under Nixon, Reagan, and George W. Bush as Republicans cut the taxes… The Bush Tax Cuts held through Obama’s first term, and account for today’s sluggish reinvestment. More precisely, the reinvestment turned upwards under Obama until 2010 when Republicans took over Congress, and has fallen since. I can’t wait to see 2013’s numbers, for I expect to see real investment increase there as well. However those higher tax rates on the top half percent implemented at 2013’s beginning, sent financiers scurrying and bargain empty homes were bought up by investors with lots of cash which brought up the floor of the housing market (perhaps to our future peril). It also accounts for stocks becoming an area of liquidity to hold cash,..explaining the record highs ….
So we have an opposite relationship: cutting taxes increases corporate profits which go elsewhere other than reinvestment back into the ecnomy.
Increasing taxes, cuts into the Free Cash Flow, and funnels some of that flow over to reinvestment projects.
Ever wonder how Delaware’s 3 banks lasted for decades and then all disappeared very close to each other? Bank of Delaware, Delaware Trust, and Wilmington Trust. are now owned by other entities. (Wilmington Trust had some hand in cutting off its own foot). Commerce Bank, which was New Jersey based had the same fate.
They lasted for years because big banks never had enough free money to buy them out. Just think. In Delaware there are now 3 less bank presidents. 18 less bank officers, and who knows how many clerical workers are missing because the work goes to the owners headquarters, not located here…. One still wonders if our state could be better off, had MNBA not been bought up by an outside conglomerate.
So giving more money to businesses and corporations in this case, cost us jobs… and destroyed 3 long termed Delawarean corporations…
That was one example. Across this nation, in every city, every county, every state are millions more….
Raising the tax rates drives re-investment. It is the only thing we know of so far that consistently works to drive re-investment. Everyone who insists on cuts and de-regulation, no matter how they spin it, is pursuing a policy that has been completely disproven by reality and fact and of course, recent history..
Are you better off than you were under Clinton? Your income level will probably determine your answer….. Because yes, some people are indeed, a lot better off. John Carney. Tom Carper. Chris Coons, Jack Markell, to name 4 off the top of my head…. Better off too, are those who these four represent… the 1%. Much better off!
If you find someone willing to raise taxes, stick to them like glue. They are the ones who will lead us back to prosperity…..
Until then, economic stagpression will continue…. continuing through tomorrow, and tomorrow, and tomorrow….(at a) petty pace that creeps from day to day….
You will probably hear about this later, but only if the corporate media cannot keep it under wraps. Al Jazeera right now, is the only major news source showing up on the top 4 search engines running this Associated Press story regarding a quiet news dump made by the IRS. First question: Why Al Jazeera? On to the news dump….
- The top 1 percent of U.S. earners collected 19.3 percent of household income in 2012, their largest share in Internal Revenue Service figures going back a century.
- Until last year, the top 1 percent’s share of pre-tax income had not yet surpassed the 18.7 percent it reached in 1927,
- The incomes of the top 1 percent rose 19.6 percent compared with a 1 percent increase for the remaining 99 percent.
- 95 percent of the income gains reported since 2009 have gone to the top 1 percent. That compares with a 45 percent share for the top 1 percent in the economic expansion of the 1990s …
- The top 10 percent haven’t done badly, either. Last year, they captured 48.2 percent of income, another record. Their biggest previous take was 46.3 percent in 1932.
Just to see how you compare, the top 1 percent of American households had income above $394,000 last year. The top 10 percent had income exceeding $114,000.
What you can do about it?
You can promise you will never vote for anyone who will give a tax cut to the top 1%. Ever. This is not a party ideology thing; all three parties are guilty. This is a real thing affecting you. Just looking above at the simple comparison between today and the nineties should readily tell everyone that our current tax rate on the top one percent is 50% too low…
It is so obvious that all our personal and national financial troubles come from all the money being sucked up by the 1%…… Stop that, or recycle a lot of it back, and America gets back on its feet as with a shot of adrenalin…
We need to shut down all talk of tax cuts for the wealthy… Any tax cut benefiting the one percent, is a very, very, very bad thing. Facts almost hurt you when they hit you in the face; it is impossible not to see otherwise.
Which is why; since all American news sources are owned by the top 1%, you won’t hear this Associated Press story on any other outlets, unless you post it yourself on your social media, and it goes viral….
Do it.
Because Congress has not yet acted to approve normal borrowing authority after
May 18, the Treasury Department will begin implementing the standard set of extraordinary
measures that enable us, on a temporary basis, to protect the full faith and credit of the United
States by continuing to pay the nation’S bills. These measures are the same ones that have been
used in previous debt limit impasses, and are described in detail in an appendix to this letter.
And so it begins again…. Another debt ceiling crises…. Can we ever get rid of this pestilence which afflicts us?
Hope you’ve gotten out of the market? Remember what happened the last time. And the effect upon the economy which just like this year, had grown amazingly well the first quarter… and then.. Bam!
Astra Zenica is closing out 1200 jobs. Just think if the Port of Wilmington was going to be losing jobs as well?
Corporate entities are one thing. but good old fashioned labor unions are what provide stability to an entire city.
Yep, the Paul Ryan budget was released today. As expected it is a budget designed to protect the top 1% from any bad thing that could possibly occur to them. As was poetically so well put by Romney during the past campaign…. ” ha, ha, ha, ha, ha…. The rest of us don’t matter….”
Today prominent theologians of all religions universally excommunicated the Republican Party of the United States of America from any pretension of anything corresponding to organized religion.
“They’re a cult, I tell you!!!”
Republicans in congress. God is watching you. And if you Fundamentalists would read your Bibles, you’d already know whose side He is on.
The rest of us… If you thought Republicans would come to their senses and start reinvesting in America, the joke is on you.
Nothing will ever change until America gets mad enough to rid ourselves of this pestilence forever…. You don’t have to vote for a Democrat. Most of you won’t… But you do… have to not vote for a Republican….
Unless you no longer consider yourself a moral individual, change your Registration…. TODAY!!!!!!!
Although the year is barely out, we do have our first nomination for the spot to be announced in December 2013. With the Kinder Morgan Deal now on hold semi-permanently, even they are pointing to our hero of the year as the man most responsible for allowing the port to remain state owned….
I can say it was Julius Cephas who was behind almost every move to combat the loss of good jobs at our port. He is being pointed out as the villain by the capitalists at Kinder Morgan. In Delaware’s eyes, that elevates his hero’s stature even more…
In truth, he is no villain and knowing him, he will probably shun the acclimations being made by us common folk as being our hero. In his eyes, he was just doing what needed to be done because no one else was there at that very moment to do it, and as that task swelled, it took a lot out of him….
Capitalists always need a villian. But it was the “truth” which actually is what killed this deal. Kinder Morgan WAS going to cut back on jobs, and their change of heart and blaming Julius instead of others, points exactly to the core of their problem with our port… …
People in Texas, do not understand unions. They simply can’t fathom or understand how there can be an actual law that lets people strike and shut you down, whenever you try to pay them less.. In their eyes, you work for what they want to give you and if it is too little, ..humph. go elsewhere….
The second culprit (after the “truth”), was our office of economic development. We gave Kinder Morgan too many “eager” signals that set us up as being seen as an easy pick. They truly thought they could waltz in, pick up a top notch East Coast Port for a song, and we would eagerly give it up… Again, that was because everything was done in secret. Had a meeting been forthcoming in the very beginning, Kinder Morgan might have moved on earlier when it became readily apparent, that southern Texas practices do not bode well in the Northeast…
Of course, being a corporation, they will blame the whistle blower. (Ironic since the whistle blower of Enron works for them).. Of course. It is not like they find anything immoral in taking a state asset for a song, in firing those skilled dock workers, and replace them with some Spanish speaking Texans who never even heard of a union….
And Julius did blow that whistle. . Like Rose on the Titanic, he took the whistle off of Jack (pun intended), and blew softly at first, then harder, and harder. Gradually the sound registered on others ears….
Without Julius, Bob Marshall would not have pushed through Senate Bill 3. Without Julius, most of the links showing up in everyone’s blog, would have not been found. Without Julius, the case for protecting workers would not have even made the rounds of the Norman Oliver show….
There were many helpers. Bob Marshall, Nancy Willing, Norman Oliver, Norinda, Helene Keeley, Al Mascitti, Liz Allen, John Kowalko, and (an other blogger too shy to be mentioned here). When one looks back through all of them one sees from everywhere, there in the center of the universe, stands a normal human being just like us, known to most … as Julius.
There will come a time when a better deal will arrive. Could even be this year. There will come a time when a suitor who does care about Delaware, who does care about unions, about human beings, about those businesses on the outside, and who will want to upgrade the port for everyone’s interest, not just their own… And that suitor in this day and age, could even come from abroad. Germany is very committed to union labor, to the environment, to being a good neighbor…. There are a great many possibilities out there that are immeasurable…. We definitely dodged a Texas bullet with this one….
When that suitor arrives… Julius’s stature will be set in cement…. For he did nothing really Herculean, except argue the truth… He didn’t lie. He didn’t connive, He didn’t threaten….
That was done by our office of economic development. Instead and unlike them, Julius told the truth. He told the truth to anyone who would listen. He told the truth enough, so many “did” listen….
And that is why, he deserves this nomination as Delaware’s Man of the Year. I know it is early into 2013, but great things just do not wait!!….
You will hear smears that Julius tubed the deal… I saw the letter and it is already out on WDEL and the Delawareonline’s News Journal… But as an impartial blogger, I can tell you exactly what killed this deal.
It was “the truth”. The truth of what this deal would cost us Delawareans….. is what turned the tide and caused the outcry that rose up against it….
If Kinder Morgan really wanted this deal, they could have easily said… “we are expanding and putting 5 new berths out into the river. We are buying the port for the bargain price of $5 billion. We need those businesses outside the fence because the jobs we get, will soon be too big, we can’t do it ourselves. We will keep the union just as it is; Wilmington needs good jobs and we are going to do our part…. We are also going to contribute into an emergency fund to be used for any spill or environmental accident that takes place under our tenure….
Kinder Morgan could have done any of those things, … and didn’t…. The blame doesn’t lie with Julius after all…. Especially when you consider the following…
This Economic Council erred on Fisker Automotive. Then it erred on Bloom Energy. Then it tried to Kinder Morgan us out of our port….. Someone rushed in with a save to make sure that last one didn’t happen.
That person is now hereby nominated for Delaware’s Person of the Year…….
Roosevelt’s Inauguration 3/4/33
Courtesy of CSpan.
Franklin Delano Roosevelt’s Inauguration Day. (It was the last before the 20th Amendment moved it to January 21st.) It is hard for us to see though the old film clips but here are some additional notes from H.W. Brand’s biography of Franklin Roosevelt, titled “Traitor To His Class”….
In 1933, the pervading bitterness was similar to that experienced by today’s Republicans. They had talked themselves into believing Herbert Hoover was a shoo in. Instead it was a rout for Roosevelt. Hoover was not a social person to begin with, and his awkwardness continued though out the inauguration….
It was customary at that time, to have the outgoing president host a dinner for the incoming President. Hoover refused, and instead, settled on an awkward afternoon tea… When Mr. Roosevelt tried to mitigate the awkwardness and offer Hoover an early exit, Hoover aggravated the discomfort. “Mr. President” said Roosevelt. “as you know it is rather difficult for me to move in a hurry. It takes me a little while to get up and I know how busy you must be. So please don’t wait for me.” Hoover stood up and affixed Roosevelt with a glare. “Mr. Roosevelt. After you have been President for a while, you will learn that the President of the United States waits for no one…” and stormed off, leaving his wife to say the goodbyes..
Roosevelt began what later becoming tradition, of spending the morning at a private service, this time at St. John’s Episcopal Church. At 11 o’clock the car swung by the Mayflower Hotel and picked up both Franklin and Eleanor, then swung by the White House to pick up Hoover. Hoover surveyed the White House grounds then climbed in and scarcely looked at the Roosevelts…
As the open car pulled down Pennsylvania Avenue, Franklin politely acted like the cheers were for the actual president at that moment, the outgoing one, and declined to acknowledge them… But within blocks the fiction became unattainable and he began acknowledging the crowd by tipping his silk hat and smiling and the anger radiated by Hoover, intensified stronger.
In the Capitol he watched the swearing in of the Senators, and the Vice President John Nance Garner and watched what would be the last adjournment of a Lame Duck Congress. At one o’clock all moved outdoors and in front of a crowd of 100,000, began the ceremonies. Roosevelt was uncharacteristically serious. Many of his staff were surprised by his somber character…
As you can see in the beginning of the clip above, upon taking the oath of office Franklin took the unusual step of repeating back the entire part read from the Constitution, before saying “I do.”
This is a day of national consecration and I am certain that my fellow Americans expect that on my induction into the Presidency I will address them with a candor and a decision which the present situation of our nation impels.”
Hoover was standing next to Roosevelt and his dour expression became a grimace as he anticipated another attack upon his administration… But Roosevelt proceeded with words of encouragement and hope.
“This great nation will endure as it has endured, and will revive and prosper. Let me assert my firm belief that the only thing we have to fear is fear itself.– nameless, unreasoning, unjustified terror, which paralyzes needed efforts to convert retreat into advance.”
This line did not resonate as it does now, as the famous line we now know from our study of history. At the time, it was patiently false. Americans did have a lot to fear. Banks were closed. There was massive unemployment. Hunger was widespread, and a financial system could barely get up onto its knees.. If you notice in the clip above, to the line… there is no applause.
More noticed and featured in the following day’s headlines, were these lines assailing “unscrupulous money changers” of Wall Street as those responsible for America’s plight. “Plenty is at our doorstep, but a generous use of it languishes in the very sight of the supply”.. “Primarily this is because the rulers of the exchange of mankinds’ goods have failed through their own stubbornness and incompetence.” Waxing eloquently, “the money changers have fled from their high seats in the temple of our civilization. We may not restore that temple to the ancient truths…”
Other applause lines: “our greatest primary task is to put people to work.” This would be accomplished in part by the “direct recruiting of the government itself; treating the task as we would the emergency of war.”
“We must frankly recognize the overabundance of population in our industrial centers and, by engaging on a national scale in a redistribution , endeavor to provide a better use of the land for those best fitted for the land.”
He calls for “definite efforts to raise the values of agriculture products” for insistence that the “federal, state, and local governments act forthwith on the demand that their cost be drastically reduced”, and he spoke for an “adequate but sound currency”… He set the agenda with this: “The international trade regulations though vastly important, are, in point of time and necessity, secondary to the establishment of a sound national economy.”
If you didn’t get the gist of it, Roosevelt’s words were purposefully vague. They were crafted to inspire confidence that action was forthcoming, without belying that on one yet knew what action or actions would begin to take place. “We must act, and we must act quickly.”
“I shall not evade the clear course of duty that will then confront me. I shall ask the Congress for the one remaining instrument to meet the crises– broad executive power to wage a war against the emergency as great as the power that would be given to me if we were in fact invaded by a foreign foe.”
No president, not even Lincoln, had spoken boldly of the power he would require. The American people were demanding much, and they deserved all that government could accomplish for them.
“They asked for discipline and direction under leadership. They have made me the present instrument of their wishes. In the spirit of their gift….. I take it.”
He had an amazing 100 days.
There is a huge irony that on this same date, 80 years later, we are facing our first full day of sequestration; the exact opposite of what Franklin Delano Roosevelt ran against, won against, and fought against the entire length of his presidency. And his policies would still be in effect today. if it weren’t for the Republicans and the presidency of George W. Bush.
Pros and Cons of Holding A Nationwide Strike on January 2nd, 2013.
Pros:
1) Forces Republicans to negotiate.
2) Demonstrates to Congress this is not a game.
3) Gives everyone a day longer holiday break.
4) Raises stakes for Tea Party Republicans thinking about defaulting.
5) Causes all eyes to stay focused on the deficit issue at hand.
6) Could be conducted as a wildcat strike , just call in sick.
7) Shows that Americans are serious about taxing the wealthy.
8) Gives our president a tool to hold over corporate America
9) January 2nd is the lowest productivity day of the year, no economic loss
10) Needs to be viral to have any meaning. People have to want to show their support for balancing the budget through taxes on the wealthy.
11) Continuation of occupy themes.
12) Businesses as well as labor, can show their support for raising taxes on the wealthy.
13) After experiencing a nationwide strike, Labor negotiators will have more clout in negotiations.
14) America’s people takes back their destiny. Like Thanksgiving, almost every American is off work.
15) Will demonstrate what happens if America stops working.
16) Will be called off if Agreement is decided before Dec. 15th.
17) Should be also supported by Businesses, corporations as well as workers. We all have a hand in making sure our government can pay it’s bills far into the future.
Cons:
1) Inconvenience to those flying that day, or any travelers.
2) Lost day of work.
3) Job may fire you.
4) There are no winners in a strike. Victor goes to the one who stands hardship the longest. All lose.
5) If successful Could be overused. Strike for Animal Rights.
6) Will gum up normal operations. for whole day. and perhaps the next.
7) Will lower GDP by one day’s worth in that quarter.
8) May cause gigantic riots never before seen in the history of the World.
9) Nobody will come.
If wishes were fishes…
I’d go catch me one…..
What would I wish for? A great economy. That would take care of so many problems.
The issue within the economy that gets the most attention, is jobs. Not enough people are working. And the reason not enough people are working is because not enough money is getting spent, to add on additional help.
What we need is to get more money spent, and then add on extra people to assist with that increase of business. So, how do we do that?
Here are the old tried and true was trotted out long ago.
1) The government can hire. Those people spend money into the economy.
2) The government can award contracts. Those people now working, spend money into the economy.
3) The government can dole out more tax cuts. If people get more in their pocket they will spend more.
We’ve tried that, but the amount the government needs to spend to cover the salaries of 16 million people, would be (at $50,000 each per year) would be $800 billion. (Does TARP come to mind?) That is just a too big job for government to handle by itself…
Who on earth has $800 billion. Are we doomed?
No, corporate America makes almost $2 trillion of profits per quarter. By now all of you should know that is every 65 working days.
So who do YOU think should be hiring all these unemployed workers? The government that is in debt ($16 trillion) up to its eyeballs, or…. corporate America that after all expenses, has a new $2 trillion every 65 days to play with?
I hope you said Corporate America. We now know the cost: $800 billion/year. We now know the profit: just under $8 trillion per year (four quarters).
So the cost to Corporate America of putting all these unemployed back to work, is in percent: 10%. So instead of making a full dollar in profit, Corporate America makes 90 cents on the dollar.
If that seems like a lot, keep in mind we are not discussing an expense here. That is not a 10 % cost incurred that the business has to scramble and find some method to compensate. Historically profits are not this high. In fact, they never have been this high in the history of the United States, at least according to the records kept today of long ago. So these very high profits are a new phenomena… They are probably occurring because business just aren’t hiring;
Remember: profit is what is left over after everything has been paid off. So having businesses take ten percent of their “profits” and put people to work, doesn’t cost them anything. They just don’t record dream level profits anymore. Instead, they just have healthy profit levels..
So let us review. We have 16 million unemployed and out of work, who for just $800 billion could be working at $50,000 a year. That would give us zero unemployment. And we have Corporate America making $8 trillion a year earning profit that is so much, they have no idea or way to spend it.
So, all we have to do is make, force, impose, compel Corporate America hire 16 million people.
But wait. Wasn’t everyone up in arms over forcing, imposing, and compelling Corporate America to pay for health insurance? Saying things like the government “can’t make anyone do anything?” Didn’t a whole bunch of patriots emerge from the woodwork with that philosophy in mind?
Justice Roberts opened the door. And he showed Congress the way. Raise taxes on Corporate America; its legal; Congress can raise taxes. . Raise taxes and take their money… But, if you want to be sporting, you can allow them to not record profits as high as they have. You could also allow them to write off the amounts they invested in building new plants, establishing budgets for R & D. Hey, they could even pay you more. Better to have you a happy camper than give that money to the IRS…..
So you see, if we just raise taxes, the economy takes off. And raising taxes is really just a trick with words. All we are really going to do is raise the tax rates. The amount of taxes a corporation actually pays will stay the same or maybe be less, because their profit (by their choice) will go down and so though they will be asked to pay a higher rate, it will be on far less “income”. And where does that money go? If they act in their own selfish interests and choose to invest the money in themselves so they don’t have to fork it over to the FED’s, .. all that money goes to new jobs. 16 million of them.
The solution is plain as the words on this page. Raise the tax rates, watch corporations reinvest in themselves here in America, watch the hiring begin en masse, and watch the economy get roaring again.
It is nothing new; it is the way it always was, up until the Bush Tax Cuts were passed. How many of you remember old Delaware, where around the middle of December, Dupont’s tax division presented the data to the chairman, “this is what you gotta spend”; and building contracts came flying out of 1007 N. Market Street.
We should have never stopped the gravy train, but we did. It’s time we return to reality and raise those Federal Tax rates. It wouldn’t hurt to remove every Republican from office while we are at it………
I think I just caught me a wish…….
Why?
We had this argument in the 18th Century and America settled it for once and all with it’s frontier. Why are we revisiting it again? Could it simply be put that the economics of today rival the disparities of income existing in that time, and with our poor appreciation of history we are again repeating the same mistake?
The British social srtata (between top and middle class) moved further apart from 1745 to 1875. That translates to the exact time period of the Industrial Revolution from its inception, to the the beginning of the formation of labor unions. When employers experienced work stoppages causing their companies to lose money, it was decided that perhaps paying them a more of a pittance was not that bad an idea after all.
Furthermore, during that time frame emerged the philosophy that labor forces HAD TO BE DISCIPLINED. Since the Industrial Revolution require humans to attend machines that went non stop through day and night, the necessity to always have a human being present to operate it. This shifted all attention away from mankind’s social needs and directed it to be decided strictly by an economic perspective. It accented the philosophy that work came before life making rather commonplace conversations like this: “I don’t care if your children haven’t eaten since yesterday. You want to buy food? You be here at eleven o’clock sharp. No, change that! I’ll fire you if you are not here by 10:59.” The fact that this notion of human behavior was actually honored and promoted gives credence to it’s level of acceptability.
If conversations like this take place in YOUR workplace, than you need no further proof that the philosophy of where work fits within our lives, has returned to where it was in the latter part of the 1700’s……
In reality, we as human beings need to live our lives,…. and incorporate work somewhere within that pattern.
Austerity can be summed up in two words: debtors prisons.
Financiers of old, felt that if a person became to indignant to pay their bills, then the state, using money from its tax payers, was responsible for culling those people from society, and using them for its will. It was felt that fear of austerity, would cough up the missing funds and help cut those investor’s losses.
But over time, they found that you can’t squeeze anything out of zero.
If the indigent have no assets, you can’t take them.
Eventually all those in debtors prisons got sent to America or Australia where they became productive citizens. (That could explain Georgia’s mis-behavior today). When these positive results were seen by society back in England debtors prisons disappeared and bankruptcy became the next evolutionary step.
The difference between bankruptcy and debtors prisons, was the common sense that if you took everything a person had, divided it up between the creditors, and then let him go, it was overall cheaper to society as a whole, than incurring the cost of incarcerating him on top of all the debt he owed. Upon forgiving the debt, at least there was a chance he could go on to become a benefit to society, thereby adding his small slice to the future GDP of that nation.
Bankruptcy is a wonderful thing. Creditors get some pay back, or if not, at least get solid knowledge they should finally write off that debt, and those who once owed, can go forward. It is important to remember that bankruptcy and fraud are too distinct entities. If someone uses fraud to achieve wealth, then that case needs to go to court, to be decided on laws affecting fraud. But 99.99% of bankruptcy is not fraud. It could be a bypass built around one’s city, diverting all hotel traffic to the outskirts. It could be a diagnosis of cancer, and the choice of one’s survivors to extend that person’s life, and the choice of an insurance company not to pay for that extension. Good bankruptcies need to be separated from the frauds.
Likewise, within the realm of bankruptcies, there needs to be a separation between those happening to individuals through no fault of their own, and those CAUSED BY HARM intentionally and legally being done to society to benefit a certain perpetrator. Bain Capital is in the news. They buy a property, close it down, and put the real estate up for sale. Those employees who can’t find a job, declare bankruptcies. Are they… morally required to reimburse that new company for payments the old company made to that now bankrupt companies pension plan? They are if a court says they are. If Bain Capital gets a legal judgment requiring such a reimbursement payment, then that out- of- work person is simply out of luck. Bankruptcy ensues.
Leading us to Greece and Spain. Should citizens be held accountable for the failures of their government? Aren’t corporate presidents held accountable for the failures of their companies? What? They aren’t?
YOU MEAN THEY GET BONUSES WHEN THEY COMPANIES FAIL ? AND THE BIGGER THE FAILURE THE BIGGER THE BONUS THAT THEY RECEIVE?
Yes, that is exactly how it appears to be.
Yet we impose austerity upon those who have no connection to the amount owed, and who are in no way responsible at all for the losses their sacrifices are being taxed to pay.
We are in a sense putting them into a financial prison. Saying we are taking everything you make for the next 20 years. (Wasn’t that the entire underlying philosophy of Soviet Russia and Maoist China?)
That alone, makes the comedy of pursuing austerity apparent.
It is like against your will (but doing it to keep your job), agreeing to go on a company outing with your boss to Atlantic City, and then, when he unfortunately does badly at the roulette table, find out belatedly that he is taking the losses out of your and your coworkers pay over the next few years since you agreed to ride with him…..
So fight back Spain. Make them lose ALL their money…….. 🙂 Bottom line, they can’t take it if you don’t choose to give it….
kavips 