Why people are mad at the rich bankers

People love a success story. Look at the outpouring of grief and support for Steve Jobs' death. What makes people mad is when success is accomplished through cheating or unfairly. Look at how people go NUTS over something as dumb as steroids in sports. We Americans think we have this great idea of what fairness is, and when that fairness is violated, we really get upset. So that is why people on the right and left are really mad at bankers right now. They received bailouts and are now doing very, very well. But the bankers don't get it. Joshua M. Brown over at The Reformed Broker really nails it in this post.

Old Person Whining

My Dad sent me this today:

THE GREEN THING

  

Checking  out at the store, the young cashier suggested to the older woman that she  should bring her own grocery bags because plastic bags weren't good for  the environment.

The woman apologized and explained, "We didn't  have this green thing back in my earlier days."

The clerk  responded, "That's our problem today. Your generation did not care enough  to save our environment for future generations."

She was right --  our generation didn't have the green thing in its day or didn't call it "green."

Back then,  we returned milk bottles, soda bottles and beer bottles to the store. The  store sent them back to the plant to be washed and sterilized and  refilled, so it could use the same bottles over and over. So they really  were recycled. But we didn't have the green thing back in our  day.

We walked up stairs, because we didn't have an escalator in  every store and office building. We walked to the grocery store and didn't  climb into a 300-horsepower machine every time we had to go two blocks.  But she was right. We didn't have the green thing in our day.

Back  then, we washed the baby's diapers because we didn't have the throw-away  kind. We dried clothes on a line, not in an energy gobbling machine  burning up 220 volts -- wind and solar power really did dry our clothes  back in our early days. Kids got hand-me-down clothes from their brothers  or sisters, not always brand-new clothing. But that young lady is right.  We didn't have the green thing back in our day.

Back then, we had  one TV, or radio, in the house -- not a TV in every room. And the TV had a  small screen the size of a handkerchief (remember them?), not a screen the  size of the state of Montana . In the kitchen, we blended and stirred by  hand because we didn't have electric machines to do everything for us. When we packaged a fragile item to send in the mail, we used wadded up old  newspapers to cushion it, not Styrofoam or plastic bubble wrap  Back then,  we didn't fire up an engine and burn gasoline just to cut the lawn. We  used a push mower that ran on human power. We exercised by working so we  didn't need to go to a health club to run on treadmills that operate on  electricity. But she's right.  We didn't have the green thing back  then.

We drank from a fountain when we were thirsty instead of  using a cup or a plastic bottle every time we had a drink of water. We  refilled writing pens with ink instead of buying a new pen, and we  replaced the razor blades in a razor instead of throwing away the whole  razor just because the blade got dull. But we didn't have the green thing  back then.

Back then, people took the streetcar or a bus, and kids  rode their bikes to school or walked instead of turning their moms into a  24-hour taxi service. We had one electrical outlet in a room, not an  entire bank of sockets to power a dozen appliances. And we didn't need a  computerized gadget to receive a signal beamed from satellites 2,000 miles  out in space in order to find the nearest pizza joint.

But the current generation laments how wasteful we old folks were just because we didn't have the green thing back then?

Please forward  this on to another selfish old person who needs a lesson in conservation from a smartass young person.


Remember:  Don't make old people mad! 

 

We don't  like being old in the first place, so it doesn't take much to tick us  off.

I wrote a response, but I'm not sure I should send it to him.

Wow…ok, this will probably make you mad, but here goes. 

Nobody brings bottles and cans into the stores anymore because the stores refuse to take them, and people fight curbside recycling programs until they are forced to use them and they everyone says how wonderful they are. And the above comment from the clerk was about plastic bags, not glass and aluminum. Walking everywhere was seen as an inconvenience, so the older folks created cars and suburbs and sprawl so they wouldn't have to walk everywhere, then became old and didn’t like being old so they created pills for erectile dysfunction and cholesterol and shove these ads all over the TV so that my 4 year old asks me what that is, and they parade around in free, government-funded electric wheelchairs and scream about DEATHPANELS! as soon as someone mentions making any changes to Medicare for anyone over 55. Advances in technology and medicine have lulled us into believing we can fix anything that's wrong with our bodies, pain and expense be damned. Our politicians capitalize on this antagonism by assuring the old folks that their government benefits will be fine, that all the proposed changes only apply to the next generation. But who pays for the old folks benefits? Folks who aren’t retired yet. But the workers still have to put up with being told how we are doing everything wrong while we are expected to support our older generation on top of supporting ourselves.

We are forced to drive everywhere because our parents designed our cities to force us to use cars because that is ‘freedom’ and we only go to our cities to work and then flee to the suburbs, making the cities practically deserts at night. These old folks have taught us that economic growth is the ultimate goal for capitalism, yet all we have to show for it is more JUNK with less overall happiness. Maybe old people are mad because they are being shown that their views of the world might be incorrect in some ways. What’s wrong with that? I know some of my views are incorrect, and I would like to learn why and how. But we don’t reward knowledge anymore unless it can make you obscene amounts of money.

People choose to use dryers. We aren’t forced to use them. But we are continually bashed over the head with very, very effective advertising saying that we should use dryers and that walking is for dummies and that we aren’t manly men if we don’t own GIGANTIC MADE IN THE USA FORD F-350 Diesels that have HEMIS and can pull a gigantic boat that we never use. All I wanted to do was watch a freaking football game, yet I have to hear about how my lifestyle is inadequate during every commercial break. So dryers are bad but washing machines are good? When was the last time you hand washed all your clothes? I have to mute the TV during the ads because the commercials are so loud that even if I flee the room I am bombarded by the sound and fury of these commercials. Yet if I ignore these ads and refuse to buy things I don’t need, I am told that I am being un-American for not buying things and keeping the economy going. I don’t think that the old people were told that not buying is un-American, yet these same older folks who run and profit from these companies in retirement are telling us to do so. I don’t get it. If we just eliminate the god awful amounts of CRAP that we make, we would be much better off.

I like using a fountain for drinking water. A lot of people don’t because in a lot of places in the country the city water is HORRIBLE because old and young alike refuse to pay for new water infrastructure. Old folks remember what the old days were like because they were experiencing all of this fabulous new infrastructure that was NEW so that the water tasted a lot better and wasn’t full of giardia from the well or stream.

I take the bus because it makes sense and is actually cheaper than driving my car everywhere. Old people must think we are really pathetic for letting our kids run our lives, yet aren’t they the ones that taught us to do that when they were driving us around to soccer and baseball games in the 80’s? People do this because they think that our kids want to have really fulfilling childhoods because that will get them and edge in life and they are just sick and tired of hearing grandpa bitch about how he had to walk to school in 8 feet of snow uphill both ways every time they say hello to him and maybe they don’t want their kids to turn out the same way.

Old folks were wasteful back in the day, but like most Americans today including me and you, we are all wasteful now and have embraced the wasteful lifestyle. I think being able to use my phone to find a pizza joint is awesome now, and saves a lot of paper instead of using a phone book that doesn’t ever get used. If you agree with how dumb a smartphone is, why do you own one yourself?

Kids today are a product of their upbringing, so if kids are whining now, isn’t that because the parents (now the older generations) spoiled the snot out of them and didn’t teach them that reality doesn’t always mean getting a gold star for finger painting or their 5^th grade graduation? We teach kids that they are special, but if everyone is special, then no one is.

Old folks scold kids for staying inside and playing video games, and while exercise is a must, I bet those old folks would have played video games if they had been around when they were young. They would have eaten (and do eat) at McDonalds. When the old folks were young, all these appliances were touted and embraced as signs of PROGRESS and American ingenuity. Now they are being labeled as terrible devices that make everyone lazy. I’m pretty sure that our grandparents’ grandparents grumbled about how cars were dumb and the horse and buggy was all that was needed (never mind the massive piles of dung that would collect in the streets). People were and are wasteful because they don’t know any better. Why is knowledge treated as a bad thing nowadays? It’s human nature to resist change, but as humans aren’t we obliged to take care of our environment and not just exploit it?

So just spare me the old person whining, and I’ll spare you mine. What ever happened to ‘We are all in this together.”?

That’s how I was raised. 

Why do the Republicans even exist?

Robert Reich has an interesting blog post about how damaging it would be if the Republicans destroyed themselves. I don't know...If they took down the people who make sense and aren't bullies, that would be bad. But if they bullies go away how would that be bad? I mean, would it really be a bad thing if the absolute whackos in this country were silenced, or muzzled to a point of irrelevance? The Left has crazies too, but they do not dominate the discussion as the crazies on the Right does. Letting the party implode so that they prove to the country how whacked they are seems like it would allow the saner folks on the right to get back in the driver seat. We have become a country where we let our toddlers throw tantrums anytime they want without any discipline. That is wrong. I was raised better than that. Why is that tolerated now?

Reich's conclusion about needing two parties grounded in reality seems like the happy ideal. I don't think either party is grounded in reality right now. Having one party implode might shake the other party awake and get them grounded. I don't know. All I know is that I am absolutely terrified of what the next year could be for my family, and I'm not seeing much hope. A storm is coming.

Now, on that cheery note: How is it that Republicans can run around SCREAMING about how we need to pay for the payroll tax cut when these same assholes claims that all tax cuts pay for themselves and that offsets are unnecessary? Does that 'pay for itself' logic only apply when when vast majority of tax cuts go to wealthy earners? How about Paul Ryan, who claims to be worried about the federal budget, but was nowhere to be seen with these worries during the Bush Administration and who voted for the Medicare Part D drug plan. A plan whose cost is $400 billion and is completely unfunded except via debt? How does that work, sir? David Frum calls out how silly it's getting when the Wall St. Journal goes after House Republicans over the payroll tax.

On the ABC Sunday political talk show This Week Robert Reich, George Will, Barney Frank, and Paul Ryan debated each other over various topics. It was a good but odd debate. The debate was too short. But I found myself agreeing with Will and Ryan on how to deal with the banks. But if their ideas were proposed by a Democrat, then that Democrat would be called a Socialist by Will and Ryan. Republicans = Cognitive Dissonance.

See the show below:


Part one of the debate:


Part two:


One of the things that I've been wondering is how rich people have gotten so rich. If you look at the ones who earned their wealth not through inheritance, it is easy to come to the conclusion that these are folks that stuck with it through thick and thing, good times and bad, etc. People who are mentally tough and can take some abuse and dish it out. Yet as soon as Obama says that tax rates should go back to the 90's, and that there is income inequality, you see some of these lucky people go on television and whine about how they do agree that taxes should go up, but they are bothered by the tone. Are these folks babies? I don't get it. Life is tough. Shut up and deal with it. I was thinking about this, and then Krugman came to the same conclusion the other day, so that felt like a confirmation of sorts in my thinking.

Rick Perry has started collecting his government pension while still governor of Texas. WTF??? I thought greedy public employees were part of the problem. His response: "It's legal to do this in the state of Texas." Good for you, you douche. What he's saying is 'It's not me. It's THEM that are the problem.' Please go away, Rick Perry.

I can't answer why the Republican party still exists. But maybe Republicans will answer that all by themselves.

Not if but how

Bruce Bartlett weighs in on taxing the rich. Lots and LOTS of debunking here.

Editorial from Bloomberg News

Wow, what a day. TONS of great commentary. Starting off, there is a GREAT op-ed in Boomberg news about how taxing the rich is a good thing. Here's the link, but this is so good I'm just going to paste the whole thing here:

Raise Taxes on Rich to Reward True Job Creators: Nick Hanauer

By Nick Hanauer - Nov 30, 2011

It is a tenet of American economic beliefs, and an article of faith for Republicans that is seldom contested by Democrats: If taxes are raised on the rich, job creation will stop.
Trouble is, sometimes the things that we know to be true are dead wrong. For the larger part of human history, for example, people were sure that the sun circles the Earth and that we are at the center of the universe. It doesn’t, and we aren’t. The conventional wisdom that the rich and businesses are our nation’s “job creators” is every bit as false.
I’m a very rich person. As an entrepreneur and venture capitalist, I’ve started or helped get off the ground dozens of companies in industries including manufacturing, retail, medical services, the Internet and software. I founded the Internet media company aQuantive Inc., which was acquired by Microsoft Corp. (MSFT) in 2007 for $6.4 billion. I was also the first non-family investor in Amazon.com Inc. (AMZN)
Even so, I’ve never been a “job creator.” I can start a business based on a great idea, and initially hire dozens or hundreds of people. But if no one can afford to buy what I have to sell, my business will soon fail and all those jobs will evaporate.
That’s why I can say with confidence that rich people don’t create jobs, nor do businesses, large or small. What does lead to more employment is the feedback loop between customers and businesses. And only consumers can set in motion a virtuous cycle that allows companies to survive and thrive and business owners to hire. An ordinary middle-class consumer is far more of a job creator than I ever have been or ever will be.

Theory of Evolution

When businesspeople take credit for creating jobs, it is like squirrels taking credit for creating evolution. In fact, it’s the other way around.
It is unquestionably true that without entrepreneurs and investors, you can’t have a dynamic and growing capitalist economy. But it’s equally true that without consumers, you can’t have entrepreneurs and investors. And the more we have happy customers with lots of disposable income, the better our businesses will do.
That’s why our current policies are so upside down. When the American middle class defends a tax system in which the lion’s share of benefits accrues to the richest, all in the name of job creation, all that happens is that the rich get richer.
And that’s what has been happening in the U.S. for the last 30 years.
Since 1980, the share of the nation’s income for fat cats like me in the top 0.1 percent has increased a shocking 400 percent, while the share for the bottom 50 percent of Americans has declined 33 percent. At the same time, effective tax rates on the superwealthy fell to 16.6 percent in 2007, from 42 percent at the peak of U.S. productivity in the early 1960s, and about 30 percent during the expansion of the 1990s. In my case, that means that this year, I paid an 11 percent rate on an eight-figure income.
One reason this policy is so wrong-headed is that there can never be enough superrich Americans to power a great economy. The annual earnings of people like me are hundreds, if not thousands, of times greater than those of the average American, but we don’t buy hundreds or thousands of times more stuff. My family owns three cars, not 3,000. I buy a few pairs of pants and a few shirts a year, just like most American men. Like everyone else, I go out to eat with friends and family only occasionally.
It’s true that we do spend a lot more than the average family. Yet the one truly expensive line item in our budget is our airplane (which, by the way, was manufactured in France by Dassault Aviation SA (AM)), and those annual costs are mostly for fuel (from the Middle East). It’s just crazy to believe that any of this is more beneficial to our economy than hiring more teachers or police officers or investing in our infrastructure.

More Shoppers Needed

I can’t buy enough of anything to make up for the fact that millions of unemployed and underemployed Americans can’t buy any new clothes or enjoy any meals out. Or to make up for the decreasing consumption of the tens of millions of middle-class families that are barely squeaking by, buried by spiraling costs and trapped by stagnant or declining wages.
If the average American family still got the same share of income they earned in 1980, they would have an astounding $13,000 more in their pockets a year. It’s worth pausing to consider what our economy would be like today if middle-class consumers had that additional income to spend.
It is mathematically impossible to invest enough in our economy and our country to sustain the middle class (our customers) without taxing the top 1 percent at reasonable levels again. Shifting the burden from the 99 percent to the 1 percent is the surest and best way to get our consumer-based economy rolling again.
Significant tax increases on the about $1.5 trillion in collective income of those of us in the top 1 percent could create hundreds of billions of dollars to invest in our economy, rather than letting it pile up in a few bank accounts like a huge clot in our nation’s economic circulatory system.
Consider, for example, that a puny 3 percent surtax on incomes above $1 million would be enough to maintain and expand the current payroll tax cut beyond December, preventing a $1,000 increase on the average worker’s taxes at the worst possible time for the economy. With a few more pennies on the dollar, we could invest in rebuilding schools and infrastructure. And even if we imposed a millionaires’ surtax and rolled back the Bush- era tax cuts for those at the top, the taxes on the richest Americans would still be historically low, and their incomes would still be astronomically high.
We’ve had it backward for the last 30 years. Rich businesspeople like me don’t create jobs. Middle-class consumers do, and when they thrive, U.S. businesses grow and profit. That’s why taxing the rich to pay for investments that benefit all is a great deal for both the middle class and the rich.
So let’s give a break to the true job creators. Let’s tax the rich like we once did and use that money to spur growth by putting purchasing power back in the hands of the middle class. And let’s remember that capitalists without customers are out of business.

And along that vein, here is a great op-ed on the decision to throw out the SEC-Citigroup no wrongdoing settlement that was handed down on Monday.

Here's another op-ed on how inequality is being portrayed incorrectly by both sides of the US political classes.

The Center on Budget and Policy Priorities continues it's examination of income inequality.

It seems that things are starting to tilt: Occupy Wall Street has changed the conversation that this country is having about inequality, Massachusetts is bringing a really strong case against the banks over the housing mess, and the court system is staring to dislike the smell that is coming from the partnership the banks have with the SEC.I hope this trend continues, as this is very encouraging.

Muffingate, or how to shoot yourself in the foot

Large organizations, be they private or public are wasteful. I know this because I work for a large Fortune 500 company, and choke every day on the amount of bureaucracy I and my coworkers have to deal with. We all see waste in government as well. A recent flare up over government waste involved a report issued by the Justice Department where they stated that $4500 was spent on 250 muffins, or $16 per muffin at a conference at the Capitol Hilton. Naturally this set the Right Wingers off on a crazy diatribe about how wasteful the government is. Of course, the $16 muffins turned out to be false. $4500 was spent at the conference, but it was spent on the event space and refreshments but the original invoice just listed the total spend and the muffins. So no $16 muffins. But then the Justice Dept does an audit on this to dispel any myths about government waste and....wait for it: I present to you a 150 page audit report that defines exactly what was spent. 150 pages. WAY TO GO!!! So instead of just saying 'no we bought more than just muffins.' we get a huge report that no one reads except to get a good laugh at how dumb things can get. Here's the report. Now we DO have proof of government waste. It's a self fulfilling prophecy. I'm not against audits. It's good to check things. But instead of wasting how many thousands of dollars paying people to write a report to cover your ass, why not TRAIN your people on how to do proper inventory and invoicing? Waste is going to happen. It's human nature. But let's try to learn from it so that it won't happen again.

Save the Job Creators!

It's a classic quote from Conservatives: Too many people rely on the government. Of course, with 9.1% unemployment, people are hurting. Heck, if my wife's company doesn't find work soon, she will probably lose her job in 6 months and then be on unemployment while she searches for a job. Is that too much reliance on the government? Are you going to call me and my wife LAZY for not finding work? We were certainly dumb to buy a house in 2005, but we are current on our mortgage. If we were to walk away from that, we would be ostracized as layabouts. (Don't mention how the banks that routinely walk away from bad investments are the ones calling us lazy)

People who are protesting Wall Street are protesting the status quo, which means if you are middle class or poor, you will rack up debt just to survive and you still won't get ahead. These folks are complaining about why these bankers give them CRAP for complaining about having debt. Meanwhile these same bankers were given free reign to run around and bet OUR MONEY on anything they wanted, and in 10 years racked up a TON of leverage (debt) and nearly wiped out our economy and were BAILED OUT by US. But it's bad if we taxpayers complain about how these jerks messed everything up. We bailed them out, they not only survive, but THRIVE to the tune of 2 trillion in bonuses since 2008, yet when these protesters call foul, they are demonized as degenerate hippies.

Income inequality is a huge problem in this country. I'm going to quote an Mark Blythe, an economist that I follow:
"There’s a crisis of income growth in this country that’s papered over by credit. That’s why there’s $56-billion in student loan debt. That’s why there’s $14-trillion in mortgage debt. That’s why there’s more than $1-trillion in home equity lines of credit outstanding. Because people have been borrowing against an uncertain future to finance an ever more expensive present. At the same time income has stagnated. Let’s be clear. When you adjust wages for prices, when you look at the real wage, it’s stagnant for 40 percent of the population; and for the next 20 percent of the population it’s barely edged up over 25 years. Meanwhile the top one percent has increased its share from the late 1970s, from 9 percent of national income to 24 percent just now. You can’t say these things are not causally related… Economically, inequality is a bad thing. You don’t even need to make a moral argument. You don’t have to mention the word justice once. More equal societies grow faster."

Our country is hurting right now, but the pain is not being shared equally. The pain was created by everyone, but the burden is not being carried equally. That is why people are protesting. They want fairness.  Look at how well this country did in the 1990's, and that is when the highest tax rate was 39.5%. But if we go to that rate today, then it is Socialism! Give me a brake. The highest tax rate under Ronald Reagan was 70%. Yet he is touted as a model Republican. I don't think that Reagan would be a viable nominee in today's GOP field. These protests we are seeing are related to the Arab spring and the riots in London. People are seeing that the game is rigged, and that their voice is muffled politically. So the only option that is left is to take to the streets. I'm not saying that the country should go the way of Sweden. Some inequality is good, because some people work harder than others and should be rewarded for that. But we do believe in fairness in this country, and fairness is NOT what is going on on Wall Street, where the risks have been socialized (the bailouts) but the profits have been privitized (the bonuses). This also extends to a lot of the Fortune 500 CEOs, Boards, and executives as well. Look at HP. They just fired their last CEO who was on the job for 11 months, but he still left with a severance of millions of dollars after taking the stock and driving it into the ground. What is that? That's not capitalism.

I do not buy for one instant the idea that Social Security is going bust. It's simply not true. It needs a little bit of help, but even after payroll taxes are unable to match benefits 1-1 in 2035 it will still pay out 70% of benefits. To fix that, just raise the cap on payroll taxes from the current limit of $106,000. The real problem is healthcare costs. Note that I said healthcare and not Medicare. Medicare is expensive because healthcare in this country is ridiculously expensive. We are riding a healthcare expense bubble that is going to pop and end very badly unless we get these costs under control. To do that, we have to exact pain on an industry that is starting to run amok. And in doing so we will exact some pain on ourselves but we will end this madness. Why is healthcare so expensive? Because of competition Hospitals need to compete with each other, so they offer more services. More services are expensive. But because of the way we deal paying for our healthcare in this country, we tend to not worry about prices.

Hearing GOP leaders whine about regulations is ridiculous. Regulations just decide who pays them. The costs are already there. Ideally, regulations make those responsible deal with those costs. Of course you can go overboard, but this wholesale movement to repeal regulation is just dumb and is what helped get us into this bind in the first place.

I also find it sad that the current GOP orthodoxy is that raising taxes on the rich is a terrible thing and is the equivalent of a huge transfer of wealth from the rich to the poor yet giving the rich tax cuts is a huge transfer of wealth from the poor to the rich and that is ok. Poll after poll says that most Americans want to raise taxes on the rich, even most Republican voters agree with this.