Criticism of billionairism

Pedestrian said:

I haven't quite arrived there yet but there are many (including I think, the catholic church that believes for any 1 person

to have a net worth over $1 billion...is immoral. Certainly to have many billion$, and to make more billions

taxed at 20%...is.

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If we taxed all income as income above a cap, that might begin to address the issue.

Pedestrian said:

That is simply not the case. 60% of labor are break even or poorer than in 1980. Reagan got it all wrong and set out to destroy labor

and labor organizing. Unions now simply need to stay vigilant and fight just to keep what they have.

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Depends how superficially you’re looking at the numbers. Let’s compare housing and income:

The average home in 1980 was 1,740 sqft for average of $44,693 ($32,108-$111,493) Prime rate Avg 14.7%. That is $136,703 in 2018 dollars. That same sized house today runs $214,020 [$41,760-$1.4M] Prime rate 5.35%. If we are comparing the cost over 20 year payment term and monthly payments, in terms of affordability on average the house is 20% more affordable today. There are 7% of cases in that model where houses in 2018 are less affordable. E.g. San Francisco.

In 1980, a lower Income average was: $7,436.80[$22,744]. Middle income $21,521[$65,826] capping out at $42,000 [<$118,000]. 59% middle class, 26% lower. Today, 50% middle and 29% lower. Sounds negative, yet overall the median we use to determine that moved from $21,023[$64,303] -> $75,938. That 80% got 18% richer. The household size and numbers of earner ratio raises with income. So new a middle class average $80,674 comes from 2.6 family with 1.7 earner. Whereas the $26,540 new average of lower comes from 2.07 families with 0.89 earner. More people to divide the costs of that income make it all much more flat than it might otherwise seem. To add to that the tax burden on this population went down progressively meaning there is still more disposable income.

So don't be so quick to take broad numbers at their face.

MTAtech said:

Sorry, the narrative that the economy was horrible all through the Obama years and then suddenly began climbing once Trump got elected, has no support in actual facts. Every measure of the economy improved under Obama -- unemployment fell to 4.7% from 10%. In fact, in 2012, Romney promised that if he were elected, he'd bring unemployment down to 6% by the end of his first term (2016.) Well, it was under 5% by then under Obama.

Moreover, there was steady GDP growth and stocks tripled. Thus, your belief that the economy was coming apart until Trump saved it is right-wing fantasy.

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Just to be clear, although there is no doubt there is a lot of hyperbole [most policies have little effect] and yes the numbers show a recovery under Obama’s policy [recoveries are natural and we should only question if policies prolongs or shortens these periods]. We could discuss those specifics. The most telling measure though, shows that during Obama the fed had frozen an artificially low (stimulus level) rate and this was only raised in the post-trump era. This shows that all things considered it was not that healthy and has relatively for Trump presidential term been healthy enough to have the risks of negative forces low less costs of absorbing new growth to pay previously circulated money injection.

So, it's not entirely a fantasy although certainly has its fair-tale elements.

Conaeolos said:

Just to be clear, although there is no doubt there is a lot of hyperbole [most policies have little effect] and yes the numbers show a recovery under Obama’s policy [recoveries are natural and we should only question if policies prolongs or shortens these periods]. We could discuss those specifics. The most telling measure though, shows that during Obama the fed had frozen an artificially low (stimulus level) rate and this was only raised in the post-trump era. This shows that all things considered it was not that healthy and has relatively for Trump presidential term been healthy enough to have the risks of negative forces low less costs of absorbing new growth to pay previously circulated money injection.

So, it's not entirely a fantasy although certainly has its fair-tale elements.

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Let me address the idea of "artificially low interest rates." What exactly is "artificial" about the interest rates following the Great Recession? We had low or negative inflation' far less than full-employment and no overheating of the economy. Since the Fed's mandate is to control inflation while maximizing employment, those low rates were not artificial.

I'll instead point you to the natural real rate of interest. If you are new to the term, the natural rate is a standard economic concept dating back a century; it’s the rate of interest at which the economy is neither depressed and deflating nor overheated and inflating. And it’s therefore the rate monetary policy is supposed to achieve.

This is the graph of the natural rate during the period we are discussing, from a paper by Thomas Laubach and John C. Williams, of the Fed.



Look, all we’re talking about is the rate of interest at which the economy would be more or less at full employment, which in turn implies that inflation will be more or less stable.

Let me remind you that the Japanese had two decades of zero lower bound.

Regarding the Fed raising rates under Trump, the Fed looks to raising rates when they see unemployment rising to what may be considered full employment. On December 16, 2015 the Fed increased its key interest rate, the Federal Funds Rate, for the first time since June 2006. That was under Obama. As employment moved higher, the Fed raised rates.

marke said:

Trump has done more for the economy than any democrat in recent memory. Democrats do not like to admit it because that truth makes them look bad.

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This is wrong on many levels. As I have shown, all indicators were moving in a positive direction long before Trump arrived to take credit: Unemployment had been falling for years; GDP had been rising; etc.

To credit Trump for the trend that was in place long before he arrived on the seen takes a certain kind of misguided thinking.

MTAtech said:

Let me address the idea of "artificially low interest rates." What exactly is "artificial" about the interest rates following the Great Recession?

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First, thanks for the thoughtful reply.

Artificial in the sense it is controlled and not a market determined rate. The true market rate may be unknowable but lend/contract signals are still well established so one can be confident making general statements. We can speculate all we want about their reasoning, but a cold hard fact is that throughout the Obama presidency the Fed was signaling lend. That principle only works on that rate being lower than unknown market true value. I’d agree a raise does not always signal health, but a dip or freeze historical low cannot be read as a sign of overall health and confidence.

Yes, those are all important metrics to consider but still one part of a whole swath of factors. The ultimate point of the fed is to stabilize the money supply from volatility. Inflation is a symptom of that. When we examine money supply growth of M2+(~M3) or others you see that stabilization happened around 2012. From 2013-2016 the 2008 recovery cannot be used to brush over the policy choices not to say it still had no effect. The contributing factors all considered still indicated lower than optimal health at that time.

Infinitely more speculative but more worrying, regardless of president if we look at the last three doubling of the money supply. 2008-2018, 1997-2008, 1983-1997. We find these underlying metrics:
In 14 years: 25% increased domestic activity + 16.5% population growth [29.12% + 61.1% Inflation]
In 11 years: 14% increased domestic activity + 11.6% population growth [15.62% + 34.1% inflation]
In 10 years: 7% increased domestic activity + 7.5% population growth [7.53% + 16.6% inflation]

Some changes of in activity and usage of currency could of course be foreign and hence un-reflected, but ultimately like how governments can distort a true tax burden with debt, these numbers do make it seem our current overall rates and policies likely indicate artificially propping up the economic numbers with value bubbles. The point of a growing money supply over fixed is to reflect the real world economic and proportional growth. If that growth is not happening or is not being accurately reflected. We are asking for problems.

Japanese had two decades of zero lower bound.

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Japan is managing a near flat population growth and rapidly aging population. Their policy reflects the economic hardships that come with those realities. I would also note the natural unknown rate in Japan would be lower than America due double the private savings rate and 25% lower private debt ratio.

Obama’s economic policies cannot fully be judged for at least 10 years as there are new growth conditions, age time-bomb about explode and the historic norms barely fit the conditions post-2000. His legacy may improve with the future context giving us more information. To date, the policies seem average and trumps slightly above average. Only time will tell how it fits in the larger picture. If you would like to say otherwise go right ahead...it seem to be the thing to do eace With a republican congress though - he'll never get the credit anyway.

Pedestrian said:

The capitalist doesn't care. The capitalist doesn't care about country, community or people.

They would love to create a market like 1929 as they did then.

[They] feel to hell with you, the country and everything and everybody else.

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That exactly why Govt. must make them care about their bottom line and doing it thru confiscatory income tax rates is a proven method that worked well for over 30 years and created our great middle class. A 70% rate on all income over $1 million would do wonders in reorienting their priorities and stop the draining of money not spent from our economy that is strangling our growth and prosperity.

Conaeolos said:

First, thanks for the thoughtful reply.

Artificial in the sense it is controlled and not a market determined rate. The true market rate may be unknowable but lend/contract signals are still well established so one can be confident making general statements. We can speculate all we want about their reasoning, but a cold hard fact is that throughout the Obama presidency the Fed was signaling lend. That principle only works on that rate being lower than unknown market true value. I’d agree a raise does not always signal health, but a dip or freeze historical low cannot be read as a sign of overall health and confidence.

Yes, those are all important metrics to consider but still one part of a whole swath of factors. The ultimate point of . Inflation is a symptom of that. When we examine money supply growth of M2+(~M3) or others you see that stabilization happened around 2012. From 2013-2016 the 2008 recovery cannot be used to brush over the policy choices not to say it still had no effect. The contributing factors all considered still indicated lower than optimal health at that time.

Infinitely more speculative but more worrying, regardless of president if we look at the last three doubling of the money supply. 2008-2018, 1997-2008, 1983-1997. We find these underlying metrics:
In 14 years: 25% increased domestic activity + 16.5% population growth [29.12% + 61.1% Inflation]
In 11 years: 14% increased domestic activity + 11.6% population growth [15.62% + 34.1% inflation]
In 10 years: 7% increased domestic activity + 7.5% population growth [7.53% + 16.6% inflation]

Some changes of in activity and usage of currency could of course be foreign and hence un-reflected, but ultimately like how governments can distort a true tax burden with debt, these numbers do make it seem our current overall rates and policies likely indicate artificially propping up the economic numbers with value bubbles. The point of a growing money supply over fixed is to reflect the real world economic and proportional growth. If that growth is not happening or is not being accurately reflected. We are asking for problems.


Japan is managing a near flat population growth and rapidly aging population. Their policy reflects the economic hardships that come with those realities. I would also note the natural unknown rate in Japan would be lower than America due double the private savings rate and 25% lower private debt ratio.

Obama’s economic policies cannot fully be judged for at least 10 years as there are new growth conditions, age time-bomb about explode and the historic norms barely fit the conditions post-2000. His legacy may improve with the future context giving us more information. To date, the policies seem average and trumps slightly above average. Only time will tell how it fits in the larger picture. If you would like to say otherwise go right ahead...it seem to be the thing to do eace With a republican congress though - he'll never get the credit anyway.

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I only have time to address one point and that was your thinking that "the Fed is to stabilize the money supply from volatility." That's not really true. In times of liquidity traps, like during the Great Recession, there isn't a correlation between money supply and inflation.. Back then, it seemed totally obvious to many people (fortunately, Bernanke was one of them) that with the Fed adding to the monetary base at breakneck speed, high inflation just had to be around the corner. That’s what history told us, right?

Except that those who knew what economist Sir John Richard Hicks modeled. This time was different, that in a liquidity trap the rise in the monetary base wouldn’t be inflationary at all (and that the relevant history was from Japan since the 1990s and from the 1930s, which seemed to confirm this claim). Those who understood IS-LM predicted in advance that the actions of Bernanke's Fed wouldn’t be inflationary, while the other side of the debate was screaming "dollar debasement," "hyperinflation," and "high interest rates."

Sometimes the relationship looks like this, from one of the best economics textbooks around:



But sometimes it looks like this:

MTAtech said:

This is wrong on many levels. As I have shown, all indicators were moving in a positive direction long before Trump arrived to take credit: Unemployment had been falling for years; GDP had been rising; etc.

To credit Trump for the trend that was in place long before he arrived on the seen takes a certain kind of misguided thinking.

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Obama can take credit for the doubling of the US debt under his incompetent watch. Pelosi did not help. She somehow thought if the government passed out more food stamps the economy would rebound.

When democrats struggle to help blacks get ahead they increase government spending on welfare as if that is just what those people needed to get a leg up.

marke said:

Obama can take credit for the doubling of the US debt under his incompetent watch. Pelosi did not help. She somehow thought if the government passed out more food stamps the economy would rebound.

When democrats struggle to help blacks get ahead they increase government spending on welfare as if that is just what those people needed to get a leg up.

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I take the above post as admission that you really don't want to have a serious discussion. Your agenda clearly is to elevate Trump and diminish Obama, against the actual evidence to the contrary that I put forward.

MTAtech said:

I only have time to address one point and that was your thinking that "the Fed is to stabilize the money supply from volatility." That's not really true. In times of liquidity traps, like during the Great Recession, there isn't a correlation between money supply and inflation.. Back then, it seemed totally obvious to many people (fortunately, Bernanke was one of them) that with the Fed adding to the monetary base at breakneck speed, high inflation just had to be around the corner. That’s what history told us, right?

Except that those who knew what economist Sir John Richard Hicks modeled. This time was different, that in a liquidity trap the rise in the monetary base wouldn’t be inflationary at all (and that the relevant history was from Japan since the 1990s and from the 1930s, which seemed to confirm this claim). Those who understood IS-LM predicted in advance that the actions of Bernanke's Fed wouldn’t be inflationary, while the other side of the debate was screaming "dollar debasement," "hyperinflation," and "high interest rates."

Sometimes the relationship looks like this, from one of the best economics textbooks around:

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Another thoughtful reply and great explanation of the current thinking. Just to be fair of my criticism, I am no gold speculator. The reason I'd say we're not seeing hyperinflation (for what its worth) is the inflation is being absorbed and encourged by certian elements of our economic structure. That said, even though that hyperinflation is being controlled the real effects will lead to reorientation in the future as the path is inherently unsustainable.

The growing bubble that has been created can be detected in the market in futures valuations specifically the valuation of financial, insurance & intellectual property products [and filtering down from there]. Basically, since the dawn of time the backbone of the economy is make widget X at profit Y, or provide the services there of; from a stock market prospect rarely is that a sure bet (market leader) nor lucrative (higher profit margin, low expense). Financial, insurance, intellectual property products therefore are in higher demand as they tend to be both in relative comparison.

Energy products aside. You basically see then valuation favouring these 'new' operations by many factors higher than traditional operations. This is fine as long as we are seeing growth, either domestically or foreign. As people are all to happy to take their earnings from 'traditional' sectors to gain the advantages via 'soft' products which are all too tangible in a working system. From the soft operations prospective all is fine, for as long as you have sustainable money in you remain lucrative. Risks are significantly lower and price flexibly higher so it much easier even than traditional sectors.

The problem is that those valuations come as a consequence of predications based in exponential historical conditions. The growth curve however is and will continue to flatten. The valuation then of those products is distorted. The benefits of trading % of traditional equities & services has a diminishing return. At first, you will see small corrections in valuation like we have based on most speculative sectors and operations. Eventually though the tippling point is reached since the 'traditional' is undervalued and 'new' is holding the inflationary bubble. The value of everything now is thus based on an distortional value assigned to goods based on lucrative and nature of an open speculation market verse the main street value sense (e.g luxury good abandon in war times)

This is a similar issue to the governments tradition of running deficits even in good years just because the damages of raising debts can be absorbed by growth; or their refusal to use solid accounting to justify scaling back long-term promises to a sustainable growth rate rather than some historic prejection. The clock remains ticking though unless governments\people worldwide take actions to start deflating the valuation bubble. Like all crashes it part market (stock valuation based on probability) and part government(stimulating monetary supplies far beyond natural grow).In the end though, it's going to hurt everyone.

marke said:

Democrats and leftist commie liberals will always have their eyes on other people's money and will always be thinking of ways to get their hands on that money to pay for excesses they have promised their faithful deluded followers from the bloated big government they have built to support themselves and their crooked party.

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So you see this and are fine with it?

Pedestrian said:

The 20% tax on long term [sic] (1 year) capital gains is immoral...prime facie.

Plus something Orwellian too, called 'carried interest' [sic] and on stock dividends.

Every explanation or attempt at justification could also apply to wage, salaries and tips.

I couldn't care less about incentives or risk as they too apply to labor.

Plus we are taught that the incentives are in the marketplace...not the tax code.

The tax code is to have no responsibility to reduce or subsidie risk or provide incentives.

It is a tax regime purchased from congress via the US plutocracy.

It has firmly entrenched into the American capitalist culture, venality, avarice and greed...there's your explanation.

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What's moral about taxing wages higher than capital gains?

phattonez said:

So you see this and are fine with it?

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Am I fine with data I had nothing to do with formulating and cannot change? I guess.

marke said:

Am I fine with data I had nothing to do with formulating and cannot change? I guess.

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What is your response to this?

Sent from my HTC phone. Instaurare omnia in Christo.

iguanaman said:

That exactly why Govt. must make them care about their bottom line and doing it thru confiscatory income tax rates is a proven method that worked well for over 30 years and created our great middle class. A 70% rate on all income over $1 million would do wonders in reorienting their priorities and stop the draining of money not spent from our economy that is strangling our growth and prosperity.

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And the executive with a $2m income would then demand a raise to $3.13m to offset the tax increase or some other means of remuneration to avoid the tax increase.

Government needs the top 10% of income earners to provide the 'means for/votes of' the bottom 40%, and as a result most of the remaining inner 50% remain employed and receive wage increases to offset most but not all the inflation costs of daily life.

The devils in the details.

Well, I wouldn't use the entirely-made-up phrase "billionairism" to describe it, but we're in general agreement...

Pedestrian said:

But their tax rate is.

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As long as it is the same rate as everyone else, sure. Otherwise it really isn't any of your business.

Individual said:

And the executive with a $2m income would then demand a raise to $3.13m to offset the tax increase or some other means of remuneration to avoid the tax increase.

Government needs the top 10% of income earners to provide the 'means for/votes of' the bottom 40%, and as a result most of the remaining inner 50% remain employed and receive wage increases to offset most but not all the inflation costs of daily life.

The devils in the details.

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That is not what happened when tax rates were at those levels in the 1930's thru the 1970's so no. CEO's received salaries about 20 times the average worker instead of 300 times and wages rose together becasue increases in productivity and profits were shared. The devil was Reaganomics and the middle class is still waiting for wage increases to trickle down to them as promised.

iguanaman said:

That is not what happened when tax rates were at those levels in the 1930's thru the 1970's so no. CEO's received salaries about 20 times the average worker instead of 300 times and wages rose together becasue increases in productivity and profits were shared. The devil was Reaganomics and the middle class is still waiting for wage increases to trickle down to them as promised.

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Individual said:

And the executive with a $2m income would then demand a raise to $3.13m to offset the tax increase or some other means of remuneration to avoid the tax increase.

Government needs the top 10% of income earners to provide the 'means for/votes of' the bottom 40%, and as a result most of the remaining inner 50% remain employed and receive wage increases to offset most but not all the inflation costs of daily life.

The devils in the details.

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You must have loved the Carter years. Can't speak for everyone, but the Reagan years are the most memorable period in which I experienced increases of both income and wealth.
If you want to share in the 'profits' of a business, become a shareholder. Employees are paid a wage NOT a share of the profits. Competition affects both prices and wages, can you be replaced easily or would your employer have difficulty finding a replacement for you?
Large businesses and corporations usually pay relatively high wages, while collective bargaining results in some employees being underpaid and others overpaid. If you posses some abilities few or no others have, that another or others are willing to purchase, you can then demand and perhaps receive remuneration more relative to what you feel you're worth.

Individual said:

You must have loved the Carter years. Can't speak for everyone, but the Reagan years are the most memorable period in which I experienced increases of both income and wealth.
If you want to share in the 'profits' of a business, become a shareholder. Employees are paid a wage NOT a share of the profits. Competition affects both prices and wages, can you be replaced easily or would your employer have difficulty finding a replacement for you?
Large businesses and corporations usually pay relatively high wages, while collective bargaining results in some employees being underpaid and others overpaid. If you posses some abilities few or no others have, that another or others are willing to purchase, you can then demand and perhaps receive remuneration more relative to what you feel you're worth.

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So American workers did not deserve any raises since 1970? Or is it that those in charge did not NEED to give any raises because those workers wanted to keep a roof over their families heads? You speak just like the rich did in the 1920's and look what happened to them. By the 1930's they were jumping out of buildings to their deaths.

iguanaman said:

So American workers did not deserve any raises since 1970? Or is it that those in charge did not NEED to give any raises because those workers wanted to keep a roof over their families heads? You speak just like the rich did in the 1920's and look what happened to them. By the 1930's they were jumping out of buildings to their deaths.

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What a silly question, after presenting a graph showing a constant wage growth from 1965 to current.
What are you claiming the rich to have spoken in the 1920's?

Individual said:

What a silly question, after presenting a graph showing a constant wage growth from 1965 to current.
What are you claiming the rich to have spoken in the 1920's?

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LOL The green line is wage growth in actual dollars. It amounts to 6 cents a year in increased purchasing power over 40 years. That is not wage growth it is a disaster for the middle class.

grainbelt said:

I assume corporate means it has a large billionaire backing through the stock market ownership distribution. Yes, Im anti corporate conglomerate, anti billionaire. I dont want their money for myself. It's not envy or greed. It's an understanding that the concentrated wealth and power is not something to be desired or supported in our system. Hard workers need to win, for sure, but the economy cant support both a strong middle class and a strong corporate/billionaire class.

Sent from my SM-G930V using Tapatalk

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It is happening right now as i type.
We have a very strong middle class.
I am upper middle class and like it.

iguanaman said:

LOL The green line is wage growth in actual dollars. It amounts to 6 cents a year in increased purchasing power over 40 years. That is not wage growth it is a disaster for the middle class.

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The average wage has kept pace with inflation. Essentially, a job worth paying $2.50 per hour in 1964 now requires an employer to pay $22.65 to get the same job done. And the chart doesn't take into account additional benefits, sick leave, paid vacations, pensions, etc. which have grown in cost to the employers over the same period of time.