Topic: Why are you not at Wall Street? (Read 8289 times)

You've pretty much stumbled on my stance for why I'm against drilling in Alaska, and it certainly has nothing to do with being green directly, and everything to do with developing other forms of alternative energy. 

But the government can choose what they subsidize.  Slowly dialing down the subsidies of gasoline, while increasing the subsidies of things like flex fuel, or funding the development of better fuel technology, goes a long way.

Energy is bit harder.  Increasing the cost of electricity can potentially mean poor people dying because of extreme heat and cold.  So if the government wants to make a difference, they need to subsidize the energy producers to use and produce alternative energy, whether its the big companies like ComEd to set up large alternative energy plants, farmers setting up windmills in their fields, or housing complexes putting solar panels on their roofs. 

I'd argue that yes, a centralized power CAN do that, using the USA from 1929 into the 50s as an example. WWII ended the depression -- massive central spending fueled factories, at least temporarily. Immediately after WWII though, it looked like we might lapse back -- it was only through continued infrastructure projects and the GI Bill that we pushed through, helped my our drive to be the "first on the block with a new x." Current "stimulus" is dumb -- central spending requires massive central projects (HUGE wars, redoing the interstates, etc).

Side not: I'm hugely against Keynes, (more accurately people who think they're following his advice), but that's what I've gotten from studying that period.

Not entirely on topic, much like the last few pages, but I would like to hear a ranting reply. The bitcoin adventure has tested and forced me to reconsider many 'truths' I previously held.

Is it possible that a managed economy, when properly administered, perhaps automatically as M. Friedman suggested based on CPI targets, could help stabilize prices and growth? One of Keynes' tenets was that during a recession, the economy will contract in a feedback loop (people do not spend because they fear further contraction and that fear creates more cause to fear). Only a central 'spender of last resort' could revitalize or neutralize deflation, perhaps not to re-inflate the economy, but to prevent an undershoot. The monetary temptation has always been abused, but could a central authority in theory smooth out the economy?

The cost of higher electricity is not necessarily a bad thing.
Take gasoline for example. In US it is HEAVILY subsidized. In part directly, in part indirectly through our military paying for protection of oil fields. Thus, a gallon of gas costs about $3.50, when it really should be around $6. There are other alternative technologies out there. Ethanol and natural gas are a bit more expensive, electric is even more expensive when you take the cost of batteries into account, super-capacitors may be cheaper, but they are very expensive to research, and investors are reluctant to dump money into them, and hydrogen fuel cells are the most expensive, at close to $6 a gallon equivalent. The benefit of gas subsidies is we can all drive around on cheap gas. The benefit of NOT having these subsidies is that all of those alternative "green" technologies everyone keeps talking about will actually become competitive, and there will be a HUGE incentive to develop and implement them, which in turn will make them cheaper due to mass adoption/production. Subsidizing roads, such as adding more highway lanes using tax payer dollars, also keeps public transportation like trains from being competitive. Benefit is slightly less traffic, downside is lack of the excellent transportation infrastructure like the one in Europe and Japan.
With electricity it's pretty much the same thing. Sure, low electric costs are nice, but the upside to letting prices go up is that investors will suddenly see alternatives as viable, and will dump money into it. There are plenty of technologies waiting on the sidelines. Besides the well known wind and solar, there is a personal nuclear reactor being developed in Japan, which is the size of a small buss, is fully automatic, can be buried underground, and provides enough power to support a small community, meaning the costs can be split among many people. It is cheaper than current electricity prices, but still very expensive to develop. My university is also developing a generator that will be about the size of a refrigerator, which will gassify combustible materials and burn the gas to generate power. So, your house can be powered by anything flammable, like your bills, junk mail, lawn cuttings, leaves and twigs, and food leftovers. Again, this can easily compete with electricity you get today, but still needs investor capital, and won't be able to compete effectively until there is mass adoption, which won't be easy with cheap subsidized electric power.

I think that the core of your argument is best summed up by this sentence, correct me if I'm wrong:


The problem is there is a healthy proportion of regulation to protecting the freedom of corporations, and although I agree that it should lean towards the side of less regulation more so than most of the liberals out there, there still needs to be some regulations, especially when it comes to providing things that can be classified as necessities. 

This isn't new.  Take electricity, for example.  The costs which ComEd (or whoever your electricity provider is) is capped because electricity is deemed as a necessity, so the demand is near infinite.  If left to market forces, according to the Supply and Demand curve they teach you in Economics 101, the cost of electricity should be _much_ higher than it is now so companies can make a much larger profit.  But that could keep electricity as unaffordable to as much as a third of the population.

What about schools?  The government saw education through high school as being the average minimum to find a decent job, so they provide it for everyone through taxes.  But in the past twenty years, that minimum has risen to require some sort of post-secondary education, such as college or a trade school, and the government was slow to regulate it.  So, schools responded by raising their prices.  Banks saw this as an opportunity, so they stepped in and started offering education loans, with a hefty interest rate, which gave schools liquid funds to raise their prices _even further_.  You can't even blame the schools or the banks, because they were just responding to the pure market pressures without any regulations dictating their actions.  If the government regulated school costs, we would never have had to worry about forgiving student loans.  Same is true for health care and the insurance companies. 

You are shouting in a language many will not understand, and most won't even bother to read. You might as well shorten your posts to "GRRRAAAAAAAHHHHHHH!!!!!"

I can live with....meh...., I thought raging dickhead was p'raps a touch over the top even for my inflammatory, baiting and somewhat rambling diatribe. And please note, I have followed that with two reasoned, logical and chock o' block full of factual posts.

I love a joke, especially when it's public, and eloquent. I choose my online personae carefully to allow me the opportunity to interact with an enormous melange of different viewpoints, and as to the podium thing... well dammit, I'm right, and they are just so naive, I guess I feel like I have to shout to be heard over the noise of all those iPhones and Crackberrries tweeting how glorious they are to be sleeping on a sidewalk to change the world, when they are missing the target so utterly and completely.

But I accept the criticism, embrace your comradely remarks vis a vis disdain.

Of course that's just one raging dickhead's opinion, I might be wrong about the whole thing.

1.  Corporations are not people. True, but they are made up of people. They provide jobs for people, taxes for people, goods and services for people, investment opportunities for people, and much of the social glue that allows society to remain intact. They also create the vast majority of the innovation in our society, produce the tools that allow us to be Modern Man, and fuel the economy upon which our lifestyle exists. Indeed they are an artificial construct, but one that serves a critical function in our community. One that cannot be replaced by any other agency, as we have learned every single time we have tried to substitute, be it authoritarian rule, forced labor, collectivist utopias, or illusionary playgrounds of chemically altered realities.

2.  Money is not speech. No it is not. Money is a means to an end, and a convenient tool to quantify perceived value across a massive society that is too large to barter. I can no longer trade two chickens to the candle maker to produce the candles to make the light that I write by, it is easier to buy electricity, and use it in a lamp. Money allows us to normalize values so that the two chickens worth of electricity is pretty much the same throughout our society, and I don't have to keep a stock of poultry in my backyard to procure the goods and services that I choose to consume.

3.  Roll back the Reagan tax cuts. A little undefined, are you talking about Reaganomics and general supply-side economic policies, advocating reduced tax rates to spur economic growth, controlling the money supply to reduce inflation, deregulation of the economy, and reducing government spending, or specifically the Economic Recovery Tax Act of 1981 (the Kemp Roth Tax Cut)? It is inconceivable that anyone would advocate a return to 70% tax rates on the top earners, and a scale that distributed over 30% of all tax revenues over a sector of the population that currently pays less than 5% of the taxes in the US. The massive reduction in taxes this would produce, and a six-fold INCREASE on the middle and lower classes, might well be the spark that causes the next civil war. Or did you think that somehow the upper 5% of the population that currently pays 95% of the tax burden would just take your portion on too, like they are now? Rolling back the Reagan tax cuts would destroy the middle class, push our economy into a greater depression than the 1930's, and pretty much drive us into a modern version of the dark ages. And while the rhetorical easy path would be to claim that would be just fine and dandy with the populist street rabble at Occupy, I hesitate to think that. Consider the consequences, there is no tooth fairy that can make the laws of physical reality go away.

Take a typical single wage earner in the US who makes $35,000 per year. Right now that wage earner pays taxes at a 24% tax rate. Roll back ERTA '81, and that exact same wage earner will be at a rate of almost 40%, but instead of 3 rates, would fall in one of 26 rates. Their capital gains taxes would go up 15%, their personal exemption would be cut to $700, and that would all be paid from wages that would be taxed at significantly lower corporate rates compared to today.

That's if we roll back directly to the rates before Reagan as signed into law by Carter. Maybe a little further back? Eisenhower, 1954, our $40,000 wage earner will be taxed at 59% of his income. Or Woodrow Wilson in 1917 (a war economy not unlike today) and Mr. or Ms. $40K will be on the hook for 41%, with no deductions. So toss $16,400 off the top to Uncle Sugar, and enjoy yourself on the remaining  $1,966 per month. Oh, but wait, the State and Local governments will still want their piece, which in 1917 totaled another 14%, and to be fair, you would have at least 3% in sales, property and use taxes, so enjoy yourself on $1,640 per month.

The above quoted post is why I called you a raging dickhead. You obviously can not take a joke, nor interact with people of differing viewpoints without sounding like you are shouting down from a podium. It's funny, because I wholly agree with many of your points, particularly your disdain for the Occupy movements, but the way you come off....meh....

Banks remain solvent by granting loans that are paid back, and by working with depositors who are able to keep their funds on account. An active economy free of centralized economic planning and control allows banks to react to the conditions of their markets and to receive deposits from people who can feel secure enough that they are willing to place their wealth in deposit, while making loans that can be repaid.

Those who made poor investment decisions should suffer the consequences of their decisions. Why should society be held responsible for a poor decision, any poor decision that a person makes? To compensate those who have made poor decisions would be to turn all decisions into poor ones, because you can only do it by taking the proceeds of good decisions to redistribute to those who didn't.

Government cannot create economic stimulus. Governments can create artificial prosperity bubbles of infusions of liquid capital, or they can dilute the value of money be producing more fiat currency. They don't stimulate, because they exist only by removing resources from the economy to fund their programs.

The economy can only recover when it is no longer being torn apart by forces that will try to "manage" it with ill-conceived and reckless influences, like bail-outs, redistribution models, inflationary policies, un-based fiat currencies, massive entitlement programs for non-productive sectors of the population, and socialized initiatives that can only be funded by seizure of assets from one group to be distributed to another.

Lower consumer prices and interest rates? Stop encouraging inflationary practices, like massive entitlements. Foster job creation by removing statutory limitations on businesses, encourage growth through free markets and competitive means, and remove as much waste and dead load as possible. Eliminate duplicate government efforts, streamline regulatory controls, stop interference by officials who have an agenda, and stop making the economy support an massive proportion of workers who do not work, by eliminating entitlements for non-work, and creating wages for labor.

Higher wages, more benefits and more jobs can be the result of a more robust economy, but not if the primary goal is lower prices and lower interest rates. The key is in balance, which is best achieved through market forces, and the math of very large numbers, not by bureaucrats and central planners. All things have a price on some level, and free markets allow that price to be found and balanced. Natural growth will result in these rewards being increased. Wages go up when employers need to compete for quality workers, not when the gun is held to their head and it is demanded; benefits are expanded when employers need to keep talented, trained and valuable workers, not because an official proclaimed that everyone should get a health plan; and jobs come from business, not the government. Governments can only create dependency on the largesse of others, whether given voluntarily, by statute, or threat of force.

A balanced federal budget, and paying off the national debt? I agree, I want these things as well. But I am willing to admit that we cannot have them by destroying our credit rating with the world, continuing to curry favor with the less fortunate by inflationary spending on entitlement programs to ensure our re-election, and by acting as the puppets of investors who short the market and our very existence feverishly making their profits by fomenting discord, chaos in society and hatred between classes. The faster path to a balanced budget is to stop writing bad checks, and start living within our means.

And let's do all that with reduced taxes. Well, perpetual motion seems rather fanciful too. But it might be achieved if we started asking for so many hand-outs. Free college educations for everyone is probably not a good goal if you want taxes to go down. Mandatory government controlled health care will not expand your benefits at work, and will cause employers to hire less. Fewer jobs means fewer taxpayers, which means it will be impossible to address lower taxes and balancing a budget.

It is not too much to ask per se, but it is too much to ask without being willing to take the steps to achieve these things. They cannot be done by mandate or Imperial decree, they are initiatives that we all as a community, as a nation and as a species must undertake together. It cannot come from one group exploiting another, nor by seizing assets from "the rich" to give to the "not rich". We have to respect one another, and realize that my freedom exists only up to the boundary of yours, and that if either one of us crosses into the others, then we both lose a great deal of our freedom by compelling action from one another.

Let's stop demanding from, and starting working towards.

What they want may not be so simple, but what they need is simple.
1. Corporations are not people
2. Money is not speech
3. Roll back the Reagan tax cuts

It's very simple actually. They want the banks to remain solvent. They want those who made poor investment decisions to be compensated. They want government to create economic stimulus. They want the economy to recover. They want lower consumer prices and interest rates to remain low. They want higher wages, more benefits, and more jobs. They want the federal budget balanced and the debt paid off. And they want reduced taxes. Is that so much to ask?

Gosh Randy!

A "raging dickhead to everyone"? Everyone? Because everyone except me agrees with Occupy Wall St.? Because the universal acclaim and support from every single other living organism on the planet has been so favorable for the Occupy movement? This means any deviation from your party line is raging dickheadism?

Wow, you are one omnipotent son of a bitch, that's for damn sure. I guess I should apologize to your therapist for causing you to take any of my thoughts "to heart". Shattering self-delusional structures and all that. But I'm really glad that I'm at least getting under your skin. Maybe if you see the truth often enough, and it irritates you enough, you might take a moment to think about what a wasted effort this whole happy kumbaya circle of Occupy Fill In The Blank is. A group of self-proclaimed disenfranchised simpletons who want to see who can be the loudest crybaby on the street with no organization, no message and no coherent concept of action for change. Absolutely pathetic.

I had the opportunity to enjoy an Occupy live today- where the awe-inspiring forces of the oppressed masses managed to coalesce 8 or 9 rather sad little creatures for Occupy Naperville. The ferocity of their 15 minute message of blocking about one third of a sidewalk in front of a sandwich shop and a book store was hilarious. A microcosm of New York and London, with a tiny group of very privileged wealthy brats who have the leisure time to flagellate themselves in public decrying the "system". Oooh, look, sandals and torn jeans, what revolutionaries! Che is probably pissing himself in his grave thinking what has become of direct action.

Taking the time to speak with one of the 9 angry brats was a delight, when asked a simple question "what change would you like to effect?" Her answer was "you know, like everything that sucks, like the banks and shit, and like the Nazis in power dude, like in Washington, and how they are killing people for profits with their banks and guns." I felt the agony of her carefully misconstrued answer, and pressed the point, "yes, that's nice, but if you could change one thing, because you want change it appears, what one thing would you want to change?" Her clever response to my obvious agent provocateur behavior was "fuck you, you are just like the pigs that own America, fuck you for being a bank."

Cool. That's what we need. Less reverse anthropomorphism where people can turn into evil banks at will, stop the porcine power cabal that apparently owns the means of production in the country, and remove the National Socialists that have stealthily taken over the US government. That is the solution to all our problems. Yup, I'm looking forward to sucking social security benefits from that generation of dumb bunnies. How can we go wrong with a brain trust of finest kind cretins who can't tell the difference between a person and a financial institution, or who think everyone who doesn't agree with them is a "raging dickhead". I feel so much better knowing the ass-wipes are taking over the toilet bowl.

I wouldn't take it to heart. He's just a raging dickhead to everyone. I assume it's because he's got it all figured out.

Other buildings around LaSalle and Jackson:  Bank of America and the Federal Reserve.  That may have something to do with the choice of location. 


Not really sure where all your condescending anger's coming from.  Vets, students, minorities, professionals, unemployed and teachers were all there and were behaving in a civil way when I was there.  Occupy Chicago has also been working with Occupy Wall St., so what's your point?

Ok, I've read it, and I have two main comments.  The first one is that it mentions then glosses over and doesn't refute my claim about reducing variance to be important.  I'm a poker player, and all good gamblers understand expectation and playing for the long term, but my strategy would change if I was only playing one hand my entire life and could not ever play another.  Understand that the free market "long term" is too far away to even come close to approaching expectation within a few generations of people, let alone one.

My second response, is that the author cites the sources for his opinion to be simply the opinion of other economists.  Given that there are a lot of economists that disagree, and many historical examples of monopolies causing the problems I mentioned in my post above (and other posts in the politics forums), I can't simply take his word as fact.  Economics is not nearly as hard a science as medicine (.... but there's no reason for that other than lack of data, because as I mentioned above the long term is so long... Eventually this argument will be settled very simply with data.  [And if I'm wrong, I'm wrong.])

Still though, that was a very concise and pleasurable read, and I'm very happy to have such a well-formed view of free markets at hand.  Thanks.

Wall Street is the capital of banking and stock trading, but Chicago is just a capital of commodities trading. So what gives? Down with Big Wheat and corn futures, and evil steel based derivative securities???

So do I. My future daughter-in-law got arrested there earlier this week. Chicago is a pathetic parody of Wall Street. Just a bunch of bussed-in Rainbow Coalition professional protesters. Worthless dregs of society with no occupation other tan being angry crowds spitting whatever slogan their puppet-masters teach them.

I wouldn't share the fact that I was there if I was you, that's a lot like getting "Socially Inept" tattooed on your forehead.

I live in Chicago.  I go to Occupy Chicago instead.   

Wow that's actually well thought out and relevant!  Kudos!  Give me a day or two to read it and think about my response, but I will get back to you on this.  Thanks for a very useful contribution.