February 21, 2012
If the 1% saw the acquisition of wealth as a collaboration, if the rich, well-to-do, “successful” people recalled they aren’t doing ALL the work, the research suggests they’d be better at sharing.
Business owners guided by both concern for others and insight into the overall factors that lead to success, know this.
If the Democrats really want to get moral psychology working for them, I suggest that they focus less on distributive fairness — which is about whether everyone got what they deserved — and more on procedural fairness—which is about whether honest, open and impartial procedures were used to decide who got what. If there’s a problem with the ultra-rich, it’s not that they have too much wealth, it’s that they bought laws that made it easy for them to gain and keep so much more wealth in recent decades.
“How to Get the Rich to Share the Marbles”
20 February 2012
The role of government is always a subject of debate, but ensuring that scoundrels who are only motivated by putting money into their own pockets, and businesses that treat workers as disposable rather than seeing them as part of the collaborative effort that leads to success, are not allowed to enrich themselves without any oversight.
Jonathan Haidt is a professor of psychology at the University of Virginia and a visiting professor at the N.Y.U.-Stern School of Business. He is the author of “The Righteous Mind: Why Good People are Divided by Politics and Religion.”
February 10, 2011
The President of the AFL-CIO, Richard Trumka, joined with Gaby Pacheco on an Op-Ed piece in the Wednesday Miami Herald, “DREAM Act – keep trying” intended to reinvigorate the discussion of immigration.
“It is time for President Obama and Congress to take action on meaningful immigration reform, to turn these dreams to reality and to move our country and our economy forward.”
RICHARD TRUMKA AND GABY PACHECO
Who is Gaby Pacheco? Gaby is an “undocumented, DREAM-Act eligible youth” from Miami, risking a fair bit by stepping into the limelight.
Like it or not, immigration is the most powerful force in shaping our culture, and has been for centuries. Trumka and Pacheco have it right, asserting that our immigration “system” will not fix itself. So, what should the role of the department of Immigration & Customs Enforcement (ICE) and the rest of the state and federal agencies dealing with immigration be?
Well, if you believe some, government can’t get anything right, and should just throw in the towel and disband. I’m not one of those. We elect people to work for us in Washington (and in our state governments, too.) The reality is: without government there would be no immigration policy, let alone men and women paid to enforce it; we’d be practicing the model currently used in Somalia. Somalia, where piracy plays a central role in the economy – and thinking people find the means to leave if they possibly can.
It’s misleading for politicians and pundits to talk about reducing the size of government, cutting taxes, cutting the deficit, and lessening “government interference in our lives” while at the same time arguing for more immigration agents, more prisons, building democracies in other nations, and fixing the economy to help the middle class recover from the banking and mortgage crisis that came from deregulating Wall Street. Double talk won’t form a more perfect union, let alone ensure domestic tranquility, ok?
We’ve always believed that the way to make this country great is to ensure that future generations will enjoy a higher standard of living. That won’t happen if they can’t buy homes because they can’t even afford health insurance, while politicians cater to the whims of special interest money funneled to their incredibly expensive campaigns.
I’m not saying every tax dollar is spent wisely – we can’t even account for squandered billions simply “lost” during the abysmal Iraq reconstruction, for instance – but that’s precisely why it’s time to talk about running our government as a whole, and every agency within it, better and more carefully. Planning for the future, financial experts advise, is always about investing strategically and ensuring diversity.
“At a time when business is loudly advocating for importing skilled workers, politicians and corporate CEOs are ignoring the fact that some of our best and brightest are already here, but pushed into an underground economy where they can’t actively participate.”
RICHARD TRUMKA AND GABY PACHECO
If you believe that government should work for us, that our elected officials should work for us, that partnering with business to ensure our economic viability as a nation is a key to a future where our children can thrive and prosper, then it’s time to stop focusing on the messages that divide us.
That’s why I applaud, and stand with, that third-generation Pennsylvania coal miner Richard Trumka, and Gaby Pacheco, a DREAM Act-eligible youth from Florida, as they talk about jobs, the economy, and immigration — which the Congress seems to lack the courage and vision to address. It’s time for our elected leaders to stop playing politics and do what we sent them to do – create real solutions.
July 15, 2010
If the GOP is really serious about deficit reduction why does Sentator McConnell (R-KY) say it’s a “uniform view in his caucus that tax cuts needn’t be offset by other changes in spending” — do none of them think tax cuts affect the budget? There’s ample evidence that the tax cuts enacted under the previous administration were, in fact, the largest factor in rapidly turning the Treasury’s surplus in 2000 into the deficit under a Republican administration which mostly enjoyed a Republican Congressional majority.
What kind of voodoo budgeting lets you ignore a revenue decrease? We lost 3 million manufacturing jobs while Bush was President, but the GOP line is that tax cuts will help? Tax cuts don’t put groceries on the table of an unemployed person, but they do add to the deficit – it’s not complex math.
We’ve got to get more rational in discussing the budget and the deficit. The economy can work – productivity has nearly doubled in this country in the past 30 years, and corporate profits are obviously robust even as CEO salaries and bonuses have sky-rocketed.
Leaders who will safeguard the interests of ordinary citizens are becoming an endangered species in the Congress. In late summer 2008 Congressional leaders and the Bush administration told the country that big business needed behemoth bailouts our our entire economic system would collapse, but that Wall Street bailout did nothing to save blue collar jobs, reverse the outsourcing trends, or stimulate job creation. The bailout didn’t even stimulate lending, it just gave banks cash that went to year-end bonuses.
Bonuses – seriously. What other industry would award bonuses when they had to get billions to remain in business?
And now Senate Republicans want to balance the budget (and stir up fears about deficits) while they claim there’s no need to offset tax cuts with other revenue? Think about that. Tax cuts may or may not make be your cup of tea; they’re a tool in the economist’s arsenal. Yet to claim on the one hand deficits are bad and then turn around and advocate revenue reduction – in this case by providing tax cuts for the wealthiest citizens — without offsetting it in any way defies the reasoning powers we expect in our elected leaders.
February 11, 2010
Now more than ever Americans question that Congress is ready, willing, or able to effectively govern. We trusted them with billions of dollars in handouts to Wall Street in late 2008, but still needed a separate stimulus bill to create jobs after a new administration took office, a process which has yet to make much headway as reverberations of the economic crash continue.
Some debate the value of Cash for Clunkers, too – mostly they’re elected to Congress as Republicans, and none of them work in the auto industry. But it’s fashionable to bash the opposition, after all. The media drinks it up, and it keeps their pundits off the foreclosure stories.
The “Credit Card Bill of Rights” was so hamstrung that banks used the interval to increase fees and interest rates on consumers. The American people fear Washington has gone wrong, and the media coverage of Republican leaders steadfastly refusing to compromise on anything has come to epitomize Washington’s gridlock.
Health Care Reform was one of the keys to President Obama’s litany when he was still just Senator Obama, a candidate for our nation’s highest office. It united a broad coalition of voters who believed he understood the unfairness of a system where insurance companies treated health care differently than any other form of insurance, picking and choosing the most profitable customers while denying those who most needed health care access to what is nominally a payment system. In fact, 55 Republican members of Congress who oppose a public option, calling it a “government takeover of health care” nonetheless rely on just such a system themselves. If “government run” health care payment administration is good enough for a member of the U.S. Congress, it’s probably good enough for you and me.
Meanwhile, medical bankruptcies will continue to occur despite the skyrocketing cost of premiums. Over half the personal bankruptcy filings in the U.S. are triggered by medical costs, but Congress spent billions to prop up rich bankers who didn’t even suffer a cut in pay, let alone lose their jobs or benefit packages. Set aside the uninsured a moment, the average medical debt that causes insured families to become bankrupt is $18,000 – compare that to the bonuses paid on Wall Street.
Corporations jiggle their accounting to avoid paying taxes, and the richest Americans pay a smaller fraction that the less well-to-do in personal taxes. It’s no wonder the Tea Party concept holds appeal – we seem to have returned to taxation without representation, and if there’s one things Americans agree on it’s the concept of “fair play.” Well, Americans outside the Republican Caucus in the U.S. Capitol, anyway.
Since it’s politics, we know we have to follow the money. We’ve recently cut dozens of taxes; Congress has left income tax laws alone which would normally put the GOP in a mood to smile. In this case, with one party childishly digging in their heels much like children who won’t eat their vegetables, we have to ask: “What more does the minority hope to gain?”
January 25, 2010
“If the American people ever allow private banks to control the issue of currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers conquered.”
Economic development in the USA is at a critical juncture as we struggle to recover in the wake of the job losses and mortgage foreclosures that are the real, ongoing costs of the crisis that began in 2008 and led to our bailing out Wall Street titans. In doing that, in preserving the institutions on Wall Street from their own unregulated incompetence by borrowing from tax payers on Main Street, we may have eroded more than confidence in banks and our government; we’ve arguably both the weakened the foundation of our democracy and the harmed the engine of our economic growth.
“…we can make saving and rebuilding our middle class society an enduring, unequivocal legislative priority at all levels of government.
We’ve tried the conventional legislative approach long enough without getting where we need to be. It is time to try something new. For me, that ‘something’ is the Middle Class Amendment.”
Minnesota State Representative David Bly
Subsequently to actions that saved bankers from their own risky folly, the U.S. Supreme Court has likened Corporations to citizens, insisting they have the same “right to free speech” that the founding fathers envisioned ensuring for citizens of these United States. Yet Corporations can then use this right to advertise for political agendas as another cost of doing business, further decreasing the likelihood they’ll pay taxes. Unlike citizens, corporations aren’t taxed on income, but only on profits. They hold a special place in our tax structure, they have incentives designed to encourage them to spend money.
In a time when most surveys reveal citizens have reached their saturation point for tolerating political advertising, the U.S. Supreme Court has determined in its split wisdom to provide additional incentives to corporations to spread their profits via media campaigns. The question of how spending by actual media companies would be classified remains to be determined, of course, but let’s talk about corporations.
Are they every altruistic? No, by definition they seek the extinction of their competition. The community doesn’t improve (from a corporate point of view) by adding more who are like me, but rather when all who are like the corporation are either eliminated or assimilated. And now we want to give them the right to express political opinions, as well?
“The jaws of power are always open to devour, and her arm is always stretched out, if possible, to destroy the freedom of thinking, speaking, and writing.”
I’m not sure who stands to gain from this recent reversal by the narrowest majority in the Supreme Court, but I know it’s not the average members of our middle class, who work for a living and don’t have the luxury of accountants who work to limit if not obliterate their tax obligations the way wealthy corporations do.
“A free people [claim] their rights as derived from the laws of nature, and not as the gift of their chief magistrate.”
November 9, 2009
It’s no secret that a variety of interested parties exert influence over both economic policies and the general understanding (and reporting) of the effects of changes, just as they do in energy, health care, education, the financial sector, and/or anything else that the Congress or various federal agencies have a role in shaping. Misinformation can lead a seemingly honest, open debate far afield from reality, inhibiting the efficiency of the process while at the same time warping the outcome.
If you don’t understand fiduciary relationships, and you still think most corporate actions reflect the same sort of priorities that pertain when a truly small business is owned by a single person, or a couple, you’re missing a key factor. Shareholders, for instance, seldom have any significant influence on the pay (or bonuses) of officers engaged in potentially risky decisions at major corporations – auto manufacturers, for instance, or the financial institutions that crumbled on Wall Street as the financial crisis became obvious to virtually everybody at home and abroad near the end of the Bush administration, when we ended up dumping billions of dollars into banks without any obvious benefit (it certainly didn’t stimulate consumer lending, as both Bush and early Obama administration initiatives were intended to do.)
In fact, if you look closely, the problem of banks that are “too big to fail” is getting worse, not better, due to consolidation. But that’s not what they tell Congress or the media; the bankers speak instead of “economies of scale” to justify even further growth. Banks are tied to the model that’s ruled economic policy for decades: debt-fueled consumer spending.
Those who talk about concerns over finite resources, such as clean water, are scoffed at, and the countering rhetoric lumps them in with “climate alarmists” and “tree huggers” in such a way that genuine free market forces are not even close to determining the value of any natural resource that cannot be mined – with the curious exception that there are some cities who have privatized their formerly municipally controlled water systems, which does begin to result in a certain market value being placed on that particular resource. Of course, once a profit motive starts driving the price up, citizens in the U.S. and abroad often agitate to re-socialize their water supplies, in an era when “socializing” is used by some to imply everything that went wrong with every non-U.S. form of government.
Similarly there’s an obvious bias in the talk about income tax cuts – it generally originates from those who are well to do, and stirs the emotions of those who have much less, but more importantly if one looks closely at the data, there’s been a strong correlation in the past between those with wealth and those whose tax rates truly go down under most of the recent approaches. Would tax cuts stimulate the economy? Assuredly so – but in what way? A tax cut on income doesn’t have the same effect as, say, a tax cut (or tax credit/investment credit) for spending consistent with our national priorities, such as alternative energy sources, or research and education, etc. Such selective, targeted changes spur spending in specific areas — a very straightforward function of supply and demand, and the result is tangible — money flows to those areas, stimulating job growth and additional investment without any necessary growth of the government (growth which makes most of us justifiably cautious in the wake of the Bush administration’s under-reported increases.)
The reason that governments trying socialism, such as the USSR, to manage resources and markets for the good of the people have consistently floundered and failed is that they don’t — and can’t — have good enough centralized information to succeed making the rapid decisions necessary to control what is arguably the most intricate challenge of any “man-made” system, the decentralized activity of a vibrant, balanced economy. Markets are efficient at managing that information; but we’ve seen a dramatic example of why they cannot be expected to function for the good of the consumers when government fails to regulate those with the profit motives.
Consumers, too, need access to better information than they typically get under the current system, no matter if you’re considering tax-cuts, politics, the price of peanut butter, new home-buyer credits, or anything else. When misinformation is tolerated (or encouraged) it undermines the effectiveness of capitalism. Free markets rely on timely, accurate information – we need to consider new incentives for the reporting of “news” and information systems we base our choices on, or capitalism is absolutely doomed to implode.
October 29, 2009
You’d expect an author at this CNNMoney.com to understand the role of money in business. You’d expect an editor to send this back to re-write. Here was the basis of Peter Valdes-Dapena‘s misguided assessment:
“…majority of sales would have taken place anyway at some time in the last half of 2009, according to Edmunds.com”
So? This isn’t news, and it misses the point of the Cash for Clunkers initiative.
Valdes-Dapena and/or his editor may think selling cars sooner rather than later is a valid reason to criticize the program, but as any businessman can tell you: success in business is about cash flow. Any retail operation needs to keep their stock turning over. At a time when the inventory was sitting idle on the lots this program provided a much needed infusion, enabling dealers to pay staff, utilities, creditors, and suppliers.
Did the Cash for Clunkers program solve the economic crisis? Of course not. The goal was to turn over inventory in one segment of the industry – to keep dealerships from failing in huge numbers just before the manufacturers started to recover, thereby saving some jobs and hopefully averting a situation that would spread and further exacerbate the economic downturn.
The article may fool a person with no entrepreneurial experience, but it reflects either a shallow grasp of money and business or a thinly-veiled attack on the government’s attempt to avert a breakdown in the delivery mechanism of an industry it was actively seeking to save – without proposing any alternative that might have been even marginally effective.
The public may think “Cash for Clunkers” was as simple as just selling cars, the author evidently wants to; the reality is much subtler. Edmunds didn’t surprise anybody (except maybe CNNMoney.com staff) with the news that one of the primary effects was to accelerate the decisions and purchases – that was the point.