Eat The Rich!

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Stephen Green (aka Vodkapundit):

We’re Number Two!

The US might have the highest corporate taxes in the developed world, but if you include all the world’s nations we drop all the way down to #2.

That’s right: The UAE has a higher corporate tax rate than the US. And only the UAE.

Although Illinois, California, and New York are all helping us to catch up!

But how bad is it, really? Take Apple. To date, Apple has no debt. Zero. And a whole lot of black: About $145 billion in the bank. The problem is, most of that is in foreign banks, because Apple makes lots of money overseas. And it has already paid taxes on those profits to the governments of China, Mexico, Germany, wherever. That money has been taxed already.

But Uncle Sam does things a little bit differently. Uncle Sam taxes the money you make overseas, just as soon as you repatriate it. Even though that money has already been taxed.

Maybe you’ll think I’m crazy for saying this, but I don’t even like to get taxed just one time, much less twice.

So Apple, the company with record profits and zero debt, is engineering the largest corporate bond sale in history. Apple is about to go $17,000,000,000 into debt, even though they have many times that sitting in foreign banks.

What they’re doing in essence is borrowing against their overseas holdings to finance its capital rewards program here in the United States.

Because it’s a helluva lot cheaper to pay investors 5%, give or take, than it is to pay Uncle Sam 35%.

Now any other country — certainly every sane country — would shake Tim Cook’s hand and say, “Nice job, selling all those phones in China. Now why don’t you bring that money back here where it belongs?” And then Cook would do just that. Instead, his company has to issue debt to pay for the profits he can’t afford to bring back home, where it could be financing all kinds of new jobs.

This is what Democrats call “tax shelters for millionaires and billionaires.”

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Some people have a lot of money. That’s because capitalism is kinda like a lottery, only with better odds of winning. In a lottery everybody pays in but only a few get anything back. In capitalism, everybody who participates in the workforce gets something back. The only people who lose are the ones who invest money and lose it. “Failing to win” is not the same as losing.

The “problem” is some people win a lot more than others.

Let’s say you’re unemployed and homeless. Then you meet this senior citizen named McDonald who has a farm. Old McDonald tells you that if you work for him for 10 months he will pay you $1,000 per month now and $20,000 at harvest time. Meanwhile he will let you live for free (if you want to) up in his loft, and his wife will feed you three meals a day.

You are broke, homeless and hungry so you take his offer. It’s just the two of you working as you help him plow, plant, weed and irrigate. Come the fall you help him harvest his crop and take it to the buyer. Each month he has given you $1,000 just like he promised.

It was a really good year and the buyer gives Old McDonald $1,000,000 for his crop. How much does Old McDonald owe you?

a) $20,000
b) $20,000 plus a nice fat bonus
c) $500,000
d) I am suing that cheap slavedriving bastard for exploiting me and making me live in sub-standard housing!

The correct answer is “a” – Old McDonald owes you the wages you contracted for, nothing more.

Capitalism isn’t perfect, but it works. For most of human history “prosperity” meant “not starving to death”. Even prosperous people often went hungry before winter was over.

We do need a safety net for children, the old, the disabled and the temporarily unemployed. Yes, I am worried about the undue influence caused by concentrations of wealth. But killing the golden goose is not the answer. Wealthy people need us to buy the products their factories make. They also need us to work in those factories to make those products they want us to buy.

When I was a kid I was told to eat my vegetables because there were starving kids in China and India. Now I’m supposed to worry about China and India stealing our jobs. I guess we’re supposed to let them starve.

Let me close with a favorite quote from Lazarus Long (Robert A. Heinlein):

Throughout history, poverty is the normal condition of man. Advances which permit this norm to be exceeded — here and there, now and then — are the work of an extremely small minority, frequently despised, often condemned, and almost always opposed by all right-thinking people. Whenever this tiny minority is kept from creating, or (as sometimes happens) is driven out of a society, the people then slip back into abject poverty. This is known as “bad luck.”

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Wealth Gap?

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My son sent me this link – Mashable:

The issue of wealth inequality across the United States is well known, but this video shows you the extent of that imbalance in dramatic and graphic fashion.

The video, which started going viral on Friday and whose traffic continues to climb on YouTube — reflects the facts as seen from many different sources. We present it without comment, letting you, our readers, be the judge.

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That video is misleading because it measures comparative net worth. But lots of people with middle class incomes have little or no net worth. Add up everything you own (house, cars, savings, retirement) and subtract everything you owe (including mortgage, consumer debt and student loans) and that’s your net worth.

If you are upside down on your mortgage and don’t have a lot of savings you can easily have a negative net worth, even if you are making $50,000 year and living in a big house. This is especially true if you are younger and haven’t had a chance to accumulate equity and retirement savings.

Does it really matter how much money Bill Gates has? What claim do we have on his wealth? Did he steal it from the rest of us? Appeals of this nature are designed to provoke feelings of unfairness – “He’s got so much more than me, that’s not fair!“

Bill Gates amassed a huge fortune, but he did it playing by the rules as they existed then. So now he’s a billionaire. What do we do about it? We already taxed the money when he earned it, and now we tax the considerable interest he earns on his wealth each year. So what’s next? Do we levy a tax on assets? Unless we do he’s just gonna keep getting richer, even if we took half his interest income in taxes.

Here’s an alternative point of view:

The wealthy accumulate wealth by appropriating the wealth created by those who sell their wealth creating power to the wealthy. Everyone who receives a paycheck enhances the wealth of the wealthy by being paid less than the amount of wealth they produce. If you do not produce excess wealth for the wealthy, or otherwise contribute to the profit of the wealthy, your employment will be terminated.

The wealthy distribute that which they appropriate in a manner that in their judgment best insures their continued accumulation of wealth. Those who best serve the wealthy are best compensated for their successful efforts at accumulation of wealth from the producers of wealth for appropriation by the wealthy.

People commonly understand the wealthy as creators of wealth rather than appropriators of wealth. People desire to serve those whom they see as the the source of wealth for a share of the wealth, misunderstanding that in serving the wealthy they are serving the distributors of wealth, those who are also the appropriators of wealth, but not the producers of wealth.

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Shorter version: “The rich get wealthy by stealing it.” So did Bill Gates steal the wealth of all those Microsoft employees who have worked for him over the years? Or was he stealing from the people who bought his products? Both? When Microsoft stock goes up in value, who is he stealing that from?

There is a political issue involving the inequality of wealth, but it’s not one of fairness. It has to do with the fact that wealth translates into political power, giving the wealthy relatively more power than those less fortunate. That’s certainly anti-democratic, but the only thing we can really do is minimize the effect that individual wealth has on government.

Here’s a cold, hard historical fact – the only societies with no income or wealth inequality are those where everybody is poor. This includes feudal societies, capitalist nations, socialist countries and third-world states.

There are a lot of ways you can compare the top and bottom levels of society including relative wealth and income. The real measure of wealth is standard of living. And the comparison should be between the poorest people here and the poorest people in other countries. That’s where the critical disparity is.

Even the poorest nations around the world have a wealthy 1% – the rich upper crust that controls the government. But where is the standard of living of the bottom levels of society the highest?

Right here in the good ol’ U.S of A.

Not only are our poor people fat, but we have to import the poor people of Mexico and other poorer-than-us nations do do the work our own poor people won’t deign to do themselves. You pretty much have to be mentally ill or drug addicted to be homeless in this country, and even then they have sleeping bags and tents to shelter them from the elements.

Capitalism isn’t perfect but it works. We can analyze and theorize why it works, but it works. Until we find something that works even better we need to hang on to the only economic system with a proven record of creating wealth for everyone involved.

That does not mean we should return to laissez-faire capitalism of the 19th Century. Capitalism needs to be regulated – but not strangled. There also need to be safety nets to protect workers from the short-term effects of free market competition.

The proper role of government is not to control the outcome, it is to provide a level playing field where capitalism can flourish, maintain the safety nets and to act as a referee. Government has no business picking winners and losers or determining how to “fairly” distribute profits.

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WTF?

This story really chaps my hide:

The small band of strikers that has effectively shut down the nation’s busiest shipping complex forced two huge cargo ships to head for other ports Thursday and kept at least three others away, hobbling an economic powerhouse in Southern California. The disruption is costing an estimated $1 billion a day at the ports of Los Angeles and Long Beach, on which some 600,000 truckers, dockworkers, trading companies and others depend for their livelihoods.

[...]

Despite the union’s size — about 800 members of a unit of the International Longshore and Warehouse Union — it has managed to flex big muscles. Unlike almost anywhere else in the nation, union loyalty is strong at the country’s ports. Neither the longshoremen nor the truckers are crossing the tiny union’s picket lines.

[...]

The union contends that the dispute is over job security and the transfer of work from higher-paid union members to lower-paid employees in other countries. The 14-employer management group says that no jobs have been outsourced and that the union wants to continue a practice called “featherbedding,” or bringing in temporary workers even when there is no work. The two sides haven’t met since negotiations broke down Monday, but they were scheduled to begin talking again Thursday night. The union has worked without a contract for 21/2 years.

The clerical workers are a vital link in the supply chain. They handle the immense flow of information that accompanies each cargo ship as well as every item in the freight. One shipload of shoes, toys and other products is enough to fill five warehouses.

Bolding mine. Yes, these are “clerical workers.” They do a big job, of course, but at the end of the day it’s still pushing processing paperwork in an office, for which most people are paid under $15 an hour. Notice that the union is bitching about outsourcing while they are also “featherbedding.”

Featherbedding is basically telling your boss you need temp help even when you don’t, so you can lighten your own load. So basically they’re outsourcing their own jobs to temps who make abut $12 and a) bitching when the boss does it, and b) asking for more money. But wait until you see how much these “clerical workers” make.

Stephen Berry, lead negotiator for the shipping lines and cargo terminals, said the clerical workers have been offered a deal that includes “absolute job security,” a raise that would take average annual pay to $195,000 from $165,000, 11 weeks’ paid vacation and a generous pension increase.

Yeah, you read that right. They’ve been offered an increase in vacation time that amounts to 1/5th of the work year, and an average $30,000 a year increase in an already exorbitant salary. All while they’re asking $12 an hour temps to do some of their work.

As I said, these employees do a big job, and just how big is detailed in the article:

Logistics clerk Trinie Thompson, 41, normally spends her days working with railroad lines and trucking companies to ensure that the right containers are sent along to their proper destinations. On Thursday, she was walking the picket lines at the docks.

“We will be setting up trains to Houston, trains to Dallas, to Chicago, to the Pacific Northwest,” said Thompson, who has worked for 10 years for Eagle Marine Services terminal, which is affiliated with the giant APL shipping line.

“For a typical container ship, we will have to set up multiple trains. We might be sending 200 to 300 containers to Chicago alone, and there will be paperwork for all of them.”

So, to be fair they do deserve somewhat higher pay that your typical clerical worker. For the sake of fairness, let’s call them “logistics managers.” Still, do they deserve to make 12 times what an average secretary or other administrative support personnel makes? Who gets an average $30,000 raise in salary, even over 2 years, without a promotion? And who gets to take off 1/5th of the work year for freakin’ vacation?

Look, this ain’t France, and from what I hear, France ain’t gonna be France much longer. But guess who’s going to eat the $1 billion per day this strike is costing? Go ahead, guess… Here’s a couple of hints: It’s not going to be the companies, and it’s not going to be the union.

Remember that when your grocery bill goes up next month, and the cost of everything rises along with it. That’s happening so some secretaries could join the top 3% of earners, because being in the top 5% wasn’t good enough.

FFS, this is an open thread.

If you have to work tomorrow, be thankful you have a job

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Richard Saintvilus in Forbes:

Why Walmart Is Not Evil For Opening On Thanksgiving, Give It A Break

Who died and made you the authority on business principles? This was my response in a recent discussion with a family member in discussing the state of retail giant Walmart. It seems although I have no personal interest in the company, I continue to come to its defense. As far as I’m concerned, the company has become too easy of a target.

What bothers me is the idea that a scarlet letter has to be immediately attached to anyone with enough audacity to publicly say anything positive about the company. It’s beginning to get old. When Walmart is not being attacked for claims over low wages, it is being punished for what is perceived as undermining U.S. manufacturing – It all depends on what day it is. Walmart does not kill off “mom and pop” shops – they kill themselves. Anyone with enough business sense should understand this. However, why let a good opportunity for some “righteous anger” slip away.

However, aside from the fact that these arguments often get stale, over and over again, they are grossly based on hypocrisy. The same people that toss insults at Walmart can’t stay out of its stores for the convenience it brings. Still, this time around the company is being loathed and finds itself on the receiving end of increased backlash for its decision to open its doors on Thanksgiving. At the risk of sounding insensitive – so what! I don’t see what the big deal is.

However, over 30,000 people do as they have all signed an online petition asking the company to reverse its decision and close on Thanksgiving. However, Walmart’s plan is to open after 8PM – long after every one has eaten and certainly after second and third portions have had enough time to be digested. Still this is nothing new as the company also opened on Thanksgiving of last year – except this time it wants to open two hours earlier. Again, I ask where is the crime?

The petition asserts that Walmart is disregarding the needs of its employees and that the company can afford to allow them the time to be spend with their families. But does this make Walmart evil for providing employment in an economy already ravaged by lost jobs. What’s more, Walmart is not the only retailer that plans to open on thanksgiving in preparation for Black Friday. Other retailers such as Target, Kmart as well as Toy R Us also plan to take advantage of early shoppers. Yet it is Walmart that is considered evil for this decision.

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If you are on the schedule but you don’t want to work tomorrow, quit. There are lots of people out there that would be grateful to take your place.

What’s that? You can’t afford to quit? You need your job?

Well you know what your priorities are then.

Personally, I have never really cared for Thanksgiving anyway. It’s a “secular holiday” (which is an oxymoron because “holiday” means “holy day”) that is allegedly based on an alleged historical incident that is mostly fiction.

When I was a kid it meant spending hours of traveling to go visit my step-dad’s family. We would eat breakfast and jump in the car for 3 hours and then we didn’t eat lunch at the normal time because dinner was at 2:00 or 3:00 pm, then about our regular dinner time we would get back in the car to drive 3 hours to go home. I was hungry again by bedtime but got in trouble if I asked for a snack. (“Why didn’t you eat your dinner?“) Good times.

If you are single and aren’t spending Thanksgiving with your family, the whole day sucks. There is nothing good to watch on television and almost everything is closed. So you sit alone and eat your Swanson’s Hungry Man TV dinner with turkey and mashed potatoes while watching lousy football games.

Lot’s of people have to work on holidays. I have often been one of them. Beside cops and hospital workers, there are security guards, gas station attendants, motel clerks and convenience store employees. Why should Walmart employees be special?

Here’s the naked truth: If people didn’t shop on Thanksgiving, all the stores would be closed. So put your money where your mouth is and stay home tomorrow. And be thankful for what you have.

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The Twinkie Segue

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Hmmm, how can we possible use Twinkies as a segue for a post about 1950′s economic policy? Let’s ask the Shill One!

The Twinkie Manifesto

The Twinkie, it turns out, was introduced way back in 1930. In our memories, however, the iconic snack will forever be identified with the 1950s, when Hostess popularized the brand by sponsoring “The Howdy Doody Show.” And the demise of Hostess has unleashed a wave of baby boomer nostalgia for a seemingly more innocent time.

Needless to say, it wasn’t really innocent. But the ’50s — the Twinkie Era — do offer lessons that remain relevant in the 21st century. Above all, the success of the postwar American economy demonstrates that, contrary to today’s conservative orthodoxy, you can have prosperity without demeaning workers and coddling the rich.

Consider the question of tax rates on the wealthy. The modern American right, and much of the alleged center, is obsessed with the notion that low tax rates at the top are essential to growth. Remember that Erskine Bowles and Alan Simpson, charged with producing a plan to curb deficits, nonetheless somehow ended up listing “lower tax rates” as a “guiding principle.”

Yet in the 1950s incomes in the top bracket faced a marginal tax rate of 91, that’s right, 91 percent, while taxes on corporate profits were twice as large, relative to national income, as in recent years. The best estimates suggest that circa 1960 the top 0.01 percent of Americans paid an effective federal tax rate of more than 70 percent, twice what they pay today.

Nor were high taxes the only burden wealthy businessmen had to bear. They also faced a labor force with a degree of bargaining power hard to imagine today. In 1955 roughly a third of American workers were union members. In the biggest companies, management and labor bargained as equals, so much so that it was common to talk about corporations serving an array of “stakeholders” as opposed to merely serving stockholders.

[...]

The data confirm Fortune’s impressions. Between the 1920s and the 1950s real incomes for the richest Americans fell sharply, not just compared with the middle class but in absolute terms. According to estimates by the economists Thomas Piketty and Emmanuel Saez, in 1955 the real incomes of the top 0.01 percent of Americans were less than half what they had been in the late 1920s, and their share of total income was down by three-quarters.

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See? That’s how you do it!

Of course Mr. Krugman leaves out a couple important data points, like WWII and the Great Depression. The United States was the only major industrial power to emerge relatively unscathed from World War II. Europe and Asia were physically and financially devastated, Great Britain’s colonial empire was falling apart, and the Soviet Union was stuck with an economic system that did not work.

Meanwhile our infrastructure was undamaged and we were operating at full industrial capacity. War time shortages of fuel, rubber and other materials had ended, and we were able to take advantage of new technologies developed during the war.

I have read a lot of articles about the Great Depression, and none of them blame the stock market crash and the world-wide economic collapse that followed on the incomes of the upper 0.01 percent. But it is easy to see why those incomes dropped between the 1920′s and the 1950′s.

Articles like this one bother me because they fail to show causality. Krugman presents some data that, while accurate, is nonetheless dishonest because of how it is presented. He gives the impression (without explicitly saying it) that if we simply raised the top marginal tax rates back up to 91% we could re-create the economic conditions of an earlier generation.

The world has changed dramatically since Dwight Eisenhower was president. In many ways we are more prosperous than we were back then. (Look around your home and start counting all the things that did not exist in 1955.) The problem is the inflation of our expectations hasn’t matched reality.

Twinkies are a relic of a bygone era. Let bygones be bygones.

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Mitt Romney’s Speech on the Economy

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Today, Mitt Romney delivered remarks on the U.S. economy in Ames, Iowa. Read a transcript of the remarks below, as prepared for delivery:

Thank you all. It’s great to be back in Iowa. And don’t think that this is the last time you are going to see Paul Ryan and me, because you Iowans may well be the ones who decide what kind of America we will have, what kind of life our families will have.

The choice you make this November will shape great things, historic things, and those things will determine the most intimate and important aspects of every American life and every American family. This is an election about America, and it is an election about the American family.

All elections matter. This one matters a great deal. Over the years of our nation’s history, choices our fellow citizens have made have changed the country’s course–they were turning points of defining consequence.

We are at a turning point today. Our national debt and liabilities threaten to crush our future, our economy struggles under the weight of government and fails to create essential growth and employment.

At the same time, emerging powers seek to shape the world in their image–China with its model of authoritarianism and, in a very different way, Jihadists with Sharia, repression, and terror for the world.

This is an election of consequence. Our campaign is about big things, because we happen to believe that America faces big challenges. We recognize this is a year with a big choice, and the American people want to see big changes. And together we can bring real change to this country.

Four years ago, candidate Obama spoke to the scale of the times. Today, he shrinks from it, trying instead to distract our attention from the biggest issues to the smallest–from characters on Sesame Street and silly word games to misdirected personal attacks he knows are false.

An Immigrant’s Tale – Viral Video

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From Kevin Rennie at Daily Ructions:

Greenwich, Connecticut resident Thomas Peterffy takes to the airwaves today to speak of the blessings of freedom. He’s an authority. Peterffy was born, according to Forbes, in Hungary in 1944 “during a Russian bombing raid.” He made it to America in 1965 and became a great success. It is a season of artifice and manipulation in American public life. Peterffy offers a stirring endorsement of freedom. Take a look at the 1 minute ad that hits cable networks today.

He explains how it works: “Take away the incentive with badmouthing success and you take away the wealth that helps us take care of the needy.”

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If socialism is so good why are socialist countries so poor?

(h/t Legal Insurrection)

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Where do jobs come from?

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From Working people are the Job Creators by Riverdaughter:

Anyway, leaving aside the philosophical aspect, there is a straightforward reason why the real job creators are average working people. And when I say working people, I mean anyone not living on their investments. That means drop outs to professionals. I’m not an economist and I’ve only taken a couple of econ courses but none of this is over your head. It’s all common sense. Here’s how it works: you get money from work or a benefit that you worked for. With that money, you can buy things. And the more things you can buy, the more things need to be created for you to buy. And the more need for things to be created, in either goods or services, the more people need to be hired to create those goods and services.

Note that all this depends on there being money priming the pump. There must be a release of money into the system that gets the whole ball rolling. That money can come from either the private or public sector. There is no good or bad money. Public sector money is just as virtuous as private sector money in priming the pump. The money goes into the hands of working people and those working people pass that money into the hands of other working people.

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Well that’s simple enough. Government spends money and jobs magically appear. But where does all that money come from if nobody has a job? If there are no jobs there are no working people. If there are no working people how can they create jobs? We have a “chicken or the egg” dilemma here.

Artificial respiration will keep you alive but it’s not the same as breathing. It’s one thing for the government to maintain our social safety nets and another thing entirely to let it try to manage our economy.

Public sector money IS NOT just as virtuous as private sector money because it’s OPM – “Other People’s Money.” It puts politicians in a position to reward campaign contributors and cronies with windfalls. Take a look at Solyndra – half a billion dollars gone and the relatively few jobs it created are gone too.

The government spent $800 billion on the failed stimulus and it barely made a ripple. And nobody went to jail.

But wait! There’s more:

Let me stop here and say a few words about the Government. Wealthy people make The Government sound like some big, unresponsive, evil thing. But the government is whoever you elected to office. They’re supposed to spend money in the way that YOU direct them to. So, if you elect a lot of people who want to spend money in Iraq and Afghanistan, that’s what they’ll do. If you elect people who want to give all our disposable tax money to bankers who wrecked the economy, that’s what they’ll do. If you don’t want the treasury to run out of money to fund highways, schools, high speed internet infrastructure and all of the other stuff that makes this country a potentially nice place to live, stop voting for the people who are giving away your tax money to other wealthy people. It’s YOUR government and you have a right to say what things are important to you to fund. If Government is not working for you, get rid of the people who aren’t listening to what you want. We don’t have to live in a banana republic.

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If government doesn’t have my tax money, they can’t spend it. They can’t give it to bankers or spend it on wars. Don’t get me wrong – I believe in government, social safety nets and the need for infrastructure. But the idea that I should give them my money and hope they spend it wisely or I’ll vote them out is bassackwards.

Money is power. The more money we give government, the more power we give them. And as Lord Acton said, “Power corrupts.” I always find it amusing that lefties are the ones most concerned with “Big Brother” while at the same time they are the ones who want to create and empower him.

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Did the Fed just signal a Romney Win?

The Fed announced their new QE3 policy today, a permanent money window designed to suck up all the dead weight of the housing market buy the shitpile for the taxpayers’ Christmas gift. Some analysts are calling it “monetary morphine.” Looks like Bernanke knows he’s going down and is desperately trying to let Wall Street have access to one final bailout before Romney closes the money window. Romney is already on record as saying Bernanke will be out of a job if he is elected.

Some are saying this is a last ditch attempt by Bernanke to save Obama’s re-election chances, and it may very well be. But the smart money is on a 56-day farewell party and a big goodbye to access to citizens’ tax dollars for Wall Street and Bush-Obama hacks. Wall Street immediately whooped it up.

It can also be interpreted as a big FU to a pending Romney win.

This is an open thread.

Edited to say: I have no economic training and I’m just trying to pieces together based on what I’m reading and thinking. I have change the title and dialed it back a bit with this disclaimer. Hard to do from my phone, but there it is. Thanks for your patience.

Some thoughts on the “information society”

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Wikipedia:

An information society is a society where the creation, distribution, diffusion, use, integration and manipulation of information is a significant economic, political, and cultural activity. The aim of the information society is to gain competitive advantage internationally, through using information technology (IT) in a creative and productive way. The knowledge economy is its economic counterpart, whereby wealth is created through the economic exploitation of understanding. People who have the means to partake in this form of society are sometimes called digital citizens. This is one of many dozen labels that have been identified to suggest that humans are entering a new phase of society.

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Some people think we are evolving into an information society but I don’t see it as a viable model.

Let me be clear – there is a market for information and information technology. We have entered what could be called an “information age” that has profoundly impacted society in ways we don’t even yet know.

But how do you base an entire economy on information? In order to do that you either need to control knowledge or control the flow of information (or both). Either one is problematic.

There is an old saying that “A secret shared is not a secret”. How do you control knowledge once you share it? DVD burners and multi-gig jump drives are cheap and plentiful.

We already have problems with illegal file-sharing and DVD piracy. As our resident pirate can tell you, any anti-piracy software one man can design another can defeat. The only real remedy is to keep prices low enough to make piracy not very profitable.

Trying to control the flow of information is even more problematic. The whole idea of an information society is predicated on cheap and easy access to the internet. If using the ‘net becomes to difficult or expensive, people either won’t use it or they will force government to use eminent domain to take possession of the information superhighway infrastructure.

Basing an economy on the flow of information is like trying to base an economy on transportation. The industrial revolution depended on cheap and easy transportation of raw materials to factories and finished products to market. If you don’t have something of value to move you don’t need transportation.

Which brings me to my final point. The information age has not resulted in a huge expansion of human knowledge. We have seen big improvements in technology, but that’s been going on since the beginning of the scientific revolution.

Take my field – the law has not changed dramatically in the past twenty years. The practice of law has changed quite a bit as legal research and writing became so much easier. But the law itself remains pretty much unchanged.

The internet has created a truly global marketplace as buyers and sellers can easily hook-up from opposite sides of the planet. But it’s still just buying and selling.

As I said earlier, I’m not convinced that an “information society” is a viable economic model. The same thing applies to a “service economy.” That’s because neither one is predicated on producing anything tangible of value.

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Life isn’t fair

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Erika Johnson at Hot Air discusses Elizabeth Warren’s speech last night:

There is so much material here, I don’t even know where to begin, so I’ll just pick out a few key lines and go from there.

“We fought to level the playing field before.  About a century ago when corrosive greed threatened our economy and our way of life…” Greed. Oh, greed. You call it greed, I call it rational self-interest; but whatever you want to call it, one thing is certain: The profit motive, which all human beings share, by the way, is the driving force behind everything we have. Individuals trying to provide for themselves and for their families are what continually creates prosperity, a.k.a., economic growth, and an individual’s personal wealth is an indicator of how successful they’ve been in providing a good or service upon which other people voluntarily place a lot of value. How do corporations become corporations, Ms. Warren? I might patronize the hair salon or the car wash once a month or so, and these small businesses are important, to be sure. But “oil companies” and “investment banks” have so much money because I use their services every single day. I drive to work and accrue interest in my savings account all time time, just like most Americans do — and these are all voluntary, mutually beneficial transactions. And what’s more, these large corporations also provide huge numbers of jobs as well as government revenue. Please get off your high horse and quit acting like the life choices of the CEO of the oil company are somehow ignoble compared to those of the hair stylist.

“The Republican vision is clear — ‘I got mine.  The rest of you are on your own.’ Republicans say they don’t believe in government. Sure, they do. They believe in government to help themselves and their powerful friends.” Uhm, why yes actually, I am just on my way to play poker with the corporate emperors of the universe, along with the rest of Republican party. …What the what? Who are these ‘powerful friends’ I’m supposed to have, exactly, and why am I unable to divorce my motives from their oh-so-greedy wishes? News flash: I do not have powerful friends. I vote Republican because I want to lessen the impregnable power of the federal bureaucracy and create more opportunities for myself and my fellow Americans. That is all.

“People feel like the system is rigged against them, and here is the painful part, they’re right.  The system is rigged. …Wall Street CEOs, the same ones the direct our economy and destroyed millions of jobs still strut around Congress, no shame, demanding favors, and acting like we should thank them.” Blergh. This is a perfect manifestation of my precise problem with Elizabeth Warren and her “consumer financial protectin’” ilk. Yes, I grant you, the system is kind of rigged. But why are we blaming Wall Street for rent-seeking, when the metastasized federal government is what’s affording them the opportunity to rent-seek? People will always look for a way to beat out their competition, and if that includes courting favors from the government and crony capitalism, they will. This isn’t rocket science. Federal busybodies trying to incentivize the financial sector into doing things they wanted to see happen based on their political agenda was what caused the financial crisis. Everybody has an agenda — but only the government can enforce theirs through fiat without fighting the natural regulator of free-market competition. Elizabeth Warren was a big supporter of the Occupy Movement, and I made this point right when the Occupy protests first broke out — stop directing your ire at the symptoms and instead direct it at the disease.

And finally, as to the Elizabeth Warren’s claim that the Romney/Ryan ticket doesn’t care about the middle class — doesn’t anybody at that convention realize that Barack Obama’s proposal to hike taxes on America’s wealthiest earners is an absolute farce that cannot hope to pay for the level of government he wants to keep going? I feel like I’m taking crazy pills!

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So much of modern leftist ideology is based upon the idea of fairness. There is nothing inherently wrong with that because fairness is a worthy ideal. The problem comes from trying to define “fair.”

Life is not fair. If it was then we would all be identical. While (ideally) we may all be equal under the law, we are not all equal. Some of use are bigger, faster, smarter and/or stronger than others. Some are better looking. A lucky few choose the right parents and are born wealthy.

Government cannot create equality. In can, however, prohibit the more egregious forms of discrimination. Government cannot guarantee equality of opportunity but it can do something about providing opportunity to everyone.

In some places your entire life is basically predetermined at birth. If you are born poor you will always be poor. Your tribe, race or caste controls the choices available to you.

Here in this country your options may be limited by who your parents are but they do not control your life. An Ivy League education was not really an option for me, but that didn’t prevent me from getting an education. I didn’t inherit anything but my genes but just because I couldn’t rise to the top doesn’t mean I couldn’t rise above my parents.

Government cannot legislate prosperity. All it can do is maintain a physical, legal and economic infrastructure that allows prosperity to take place. That includes penalizing cheaters and preventing unfair competition.

But referees are there to enforce the rules, not choose the winners.

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Isn’t an “incomplete” what you get for not showing up?

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When asked what grade he would give himself, President Empty Chair said “incomplete.” That is really pathetic.

Paul Ryan: “Four Years Into A Presidency And It’s Incomplete?”

“The president is asking people just to be patient with him,” Republican Party vice presidential nominee Rep. Paul Ryan said on CBS’s “This Morning” today about Obama’s grade for himself. “Look, Charlie, the kind of recession we have, we should be bouncing out of it creating jobs. We’re not creating jobs near the pace [we] could.”

“That’s why we’re offering big solutions to the big problems we have today and I would just say, if you take a look at the president’s policies he calls them ‘investments.’ It’s borrowing money and spending money through Washington, picking winners and losers. Spending money on favorite, you know, people like Solyndra or Fisker. Picking winners and losers in the economy through spending, through tax breaks, through regulations does not work,” Ryan observed.

“If that kind of economics work, we would be entering a golden age along with Greece,” Ryan said of Obama’s spending policies. “So I think the ‘incomplete’ speaks for itself and that is why I think that we are going to win this and get this country back on the right track because we’re offering bold solutions.”

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Fair or unfair, Presidents are graded on four year terms. If they perform well during the first one we give them a second. And yes, Obama did inherit a big mess. But he was the One who had to win NOW, NOW, NOW! It was “his time.” Remember how Michelle told us we would not get a second chance if he didn’t win in 2008?

When a losing team gets a new coach, that coach gets a few years to rebuild the team. But after 3 1/2 seasons if the team is still losing it’s time to try someone new.

Why should we “stay the course” if the course isn’t working?

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DJ, spin that stuff!

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Paul Ryan interview:

QUESTION: Should abortions to be available to women who are raped?

RYAN: Well, look, I’m proud of my pro-life record. And I stand by my pro-life record in Congress. It’s something I’m proud of. But Mitt Romney is the top of the ticket and Mitt Romney will be president and he will set the policy of the Romney administration.

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Think Progress headline:

Ryan Refuses To Say Abortions Should Be Available To Women Who Are Raped

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I’m surprised they didn’t ask him if he stopped beating his wife.

Obviously the Democrats hope to make this election about abortion. They would rather talk about anything but the economy.

But is that a good strategy?

Are the Democrats Delusional On Abortion?

The Democrats apparently think they have hit the jackpot with Todd Akin’s moment of stupidity, but I’m not so sure. How, exactly, are they going to take advantage of Akin’s blunder? By talking ceaselessly about abortion. At the Washington Examiner, Paul Bedard headlines: “Dem Convention becomes anti-Akin affair.” That is a serious mistake. The Democratic convention should be an anti-Romney affair.

[...]

We can only pray that this report is true, and that the Democrats devote all three days in Charlotte to discussions of abortion rights, rape and contraception. If there is one thing we can say with certainty this year, it is that the overwhelming majority of voters don’t want to hear about the social issues. They want to know how we are going to climb out of the four-year economic funk that has been the Obama administration. If undecided viewers tune into the Democratic convention and hear all about abortion, and tune into the Republican convention and hear all about the economy, Romney will win in a landslide.

And, by the way, Republicans should help drive this contrast by saying nothing–and I mean, absolutely nothing–about any social issue. They should talk the economy non-stop, with occasional digressions into foreign policy. If they are asked about abortion, they should chide the reporter for asking about a topic that is of little interest to voters and that, by the way, the president, vice president, senators and congressmen have no ability to do anything about, and give an answer about the economy. If the Democrats want to define themselves to voters as the party of abortion and gay marriage, please, God, let them do so!

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This is where message discipline and sticking to your game plan become important. The Obama campaign and the media (but I repeat myself) are trying desperately to change the subject. They are grossly exaggerating Ryan’s record, trying to force him to defend himself.

But there is an old axiom – “If you are explaining, you’re losing.”

R&R need to hang tough, stick with their strategy and keep their eyes on the prize.

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Cultural Darwinism

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Mitt Romney:

Culture Does Matter

During my recent trip to Israel, I had suggested that the choices a society makes about its culture play a role in creating prosperity, and that the significant disparity between Israeli and Palestinian living standards was powerfully influenced by it. In some quarters, that comment became the subject of controversy.

But what exactly accounts for prosperity if not culture? In the case of the United States, it is a particular kind of culture that has made us the greatest economic power in the history of the earth. Many significant features come to mind: our work ethic, our appreciation for education, our willingness to take risks, our commitment to honor and oath, our family orientation, our devotion to a purpose greater than ourselves, our patriotism. But one feature of our culture that propels the American economy stands out above all others: freedom. The American economy is fueled by freedom. Free people and their free enterprises are what drive our economic vitality.

The Founding Fathers wrote that we are endowed by our Creator with the freedom to pursue happiness. In the America they designed, we would have economic freedom, just as we would have political and religious freedom. Here, we would not be limited by the circumstance of birth nor directed by the supposedly informed hand of government. We would be free to pursue happiness as we wish. Economic freedom is the only force that has consistently succeeded in lifting people out of poverty. It is the only principle that has ever created sustained prosperity. It is why our economy rose to rival those of the world’s leading powers — and has long since surpassed them all.

The linkage between freedom and economic development has a universal applicability. One only has to look at the contrast between East and West Germany, and between North and South Korea for the starkest demonstrations of the meaning of freedom and the absence of freedom.

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Once upon a time there were two competing economic cultures in the United States. In the South we saw an economic culture much like Mexico’s, where most of the good land was held in large estates owned by a small group of elites. These elites did not work the land, they owned it. They led lives of leisure and privilege.

In both places the land was worked by the lower castes. In Mexico the workers were peóns, while in the South they were chattel slaves prior to the Civil War and basically peóns for many years afterwards. The differences between slavery and peónage were more technical than practical, in that neither group was free to leave.

The Southern plantations grew cash crops, like indigo, tobacco and cotton. These crops were sold to Europe (mainly England) in exchange for both luxuries and necessities.

In the North the economic culture was much different.

The New England region’s economy grew steadily over the entire colonial era, despite the lack of a staple crop that could be exported. All the province and many towns as well, tried to foster economic growth by subsidizing projects that improved the infrastructure, such as roads, bridges, inns and ferries. They gave bounties and subsidies or monopolies to sawmills, grist mills, iron mills, pulling mills (which treated cloth), salt works and glassworks. Most important, colonial legislatures set up a legal system that was conducive to business enterprise by resolving disputes, enforcing contracts, and protecting property rights. Hard work and entrepreneurship characterized the region, as the Puritans and Yankees endorsed the “Protestant Ethic”, which enjoined men to work hard as part of their divine calling.

The benefits of growth were widely distributed in New England, reaching from merchants to farmers to hired laborers. The rapidly growing population led to shortages of good farm land on which young families could establish themselves; one result was to delay marriage, and another was to move to new lands farther west. In the towns and cities, there was strong entrepreneurship, and a steady increase in the specialization of labor. Wages for men went up steadily before 1775; new occupations were opening for women, including weaving, teaching, and tailoring. The region bordered New France, and in the numerous wars the British poured money in to purchase supplies, build roads and pay colonial soldiers. The coastal ports began to specialize in fishing, international trade and shipbuilding—and after 1780 in whaling. Combined with a growing urban markets for farm products, these factors allowed the economy to flourish despite the lack of technological innovation.

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The importance of “a legal system that was conducive to business enterprise by resolving disputes, enforcing contracts, and protecting property rights” cannot be understated. But it was a byproduct of an economic culture that emphasized freedom, hard work, independence, keeping one’s word and free trade.

Mexico is a large country (that used to be much larger) and was colonized over 100 years before the original US colonies were started. It won its independence from Spain not long after the American Revolution. It has plenty of natural resources and a population of over 100 million people. It hasn’t been directly involved in a major war (internal or external) in nearly 100 years. No one can claim that Mexicans don’t work hard, millions of them come here every year to perform manual labor at low wages. And yet Mexico lags far behind the United States economically.

The Civil War ended slavery but it left the economic culture of the South essentially unchanged. As a result the South lagged behind the North (and West) until fairly recently.

Nowadays the old Southern economic culture is gone. Survival of the fittest, and Yankee capitalism won out.

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BTW – John W. Smart stole my original post before I could write it so I had to change it. I wish he would quit doing that.

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In defense of capitalism

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The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries.”
Winston Churchill

The Joe Moneybags Gazette:

Mitt Romney’s résumé at Bain should be a slam dunk. He has been a successful capitalist, and capitalism is the best thing that has ever happened to the material condition of the human race. From the dawn of history until the 18th century, every society in the world was impoverished, with only the thinnest film of wealth on top. Then came capitalism and the Industrial Revolution. Everywhere that capitalism subsequently took hold, national wealth began to increase and poverty began to fall. Everywhere that capitalism didn’t take hold, people remained impoverished. Everywhere that capitalism has been rejected since then, poverty has increased.

Capitalism has lifted the world out of poverty because it gives people a chance to get rich by creating value and reaping the rewards. Who better to be president of the greatest of all capitalist nations than a man who got rich by being a brilliant capitalist?

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I majored in history and did my senior thesis on the Mussel Slough tragedy and the Southern Pacific Railroad. Once upon a time railroads were less popular than Wall Street bankers are today. The Southern Pacific was the inspiration for The Octopus:

The Octopus was the literary apotheosis of the power, ruthlessness, and efficiency of the modern corporation. The novel leaped from the mechanical power of the locomotive to the soulless power of the corporation:

. . . the galloping monster, the terror of steel and steam, with its single eye, Cyclopean, red shooting from horizon to horizon . . . symbol of a vast power, huge, terrible, flinging the echo of its thunder over all the reaches of the valley, leaving blood and destruction in its path; the leviathan, with tentacles of steel clutching into the soil, the soulless Force, the iron-hearted Power, the monster, the Colossus, the Octopus.

Norris modeled the railroad’s president Shelgrim after Collis P. Huntington. Shelgrim was “a giant,” a man with “an ogre’s vitality,” who had “sucked the life-blood from an entire people.”

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I started my research expecting to find proof of the evils of capitalism. What I found was somewhat different from my preconceptions.

If you look at a map of California’s Central Valley you will see that virtually all the cities are in a straight line from Stockton to Bakersfield, connected by State Highway 99. If you look closely you will see railroad tracks running parallel to the highway the entire 250 mile distance between those two points.

That’s the original Southern Pacific line. In exchange for building the railroad line the federal government gave the railroad half the land within ten miles of either side of the tracks. At that time the land was mostly unsettled.

As soon as the proposed route was surveyed people began settling on the land. The first parcels to go were the even-numbered sections which could be homesteaded for free. Then people began settling on the odd-numbered sections which were going to be awarded to the railroad.

The railroad intended to sell those parcels once the line was completed and they received title from the government. They advertised the land for sale, inviting people to move in immediately and buy later. The ads offered the land at “$2.50 per acre and upwards.”

When the railway line was completed several years later the railroad notified the occupants of the odd-numbered sections that the actual sale prices would substantially more than $2.50 an acre because the market value of the land had increased. The railroad now wanted as much as $35 per acre. A long legal battle followed by a big gunfight ensued. The settlers lost both.

Most accounts of the story tend to leave out three important details:

1. Without the railroad the land was virtually worthless.

2. There were people willing to pay the railroad the asking price for the land.

3. Many of the so-called settlers were land speculators.

Two of the seven men killed at the gunfight on Brewer’s farm were prospective buyers. Henry Brewer (who was squatting on the land where the gunfight took place) was a speculator who already occupied one of the even-numbered parcels. So were many other members of the “Settler’s League.”

The speculators plan was to occupy the land and then buy it at $2.50 an acre, then turn around and sell it for its fair market value. Easy money, right? But the Southern Pacific didn’t want to play along. Why should they let someone else make all that money?

Farming in California has always been different from the “40 acres and a mule” small farming that was more common back east. In California farming was “agribusiness.” The wheat that was grown in the Central Valley in the 1880′s went by rail to Stockton and by ship to Europe.

From Hanford (near where the gunfight took place) to Stockton was a railroad ride of a few hours. Without the railroad the wheat would have to be hauled by wagon to Stockton, a two-week round trip. Without the railroad farming in the Central Valley was not economically feasible. Without farming the railroad would have no customers.

Despite their reputation of charging “all the market can bear” the Southern Pacific had no interest in putting farmers out of business. They needed each other. If you study the growth and development of California you will realize that the railroads did not prevent prosperity.

This brings me back to my original point. I have to laugh at those mental midgets in the Occupy movement waving signs that say “Down with Capitalism.” Their sheltered lives were made possible by capitalism.

This is not to say that capitalism is perfect. It’s not, but neither is democracy. There are things we can and should do to ameliorate the worst effects of capitalism. But we shouldn’t talk about killing the goose that lays the golden eggs.

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You can’t make chicken soup out of chicken shit

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Dems to Obama: Voters don’t believe economy talk

Democratic strategists Stanley Greenberg and James Carville have released a striking new report arguing in stark terms that some key voting groups now reject President Obama’s claim that the economy is improving — and may well reject Obama himself in November.

Democracy Corps, the political consulting group run by Greenberg and Carville, showed several Obama campaign commercials to focus groups in Ohio and Pennsylvania. Several of the group members, who were “all independents or weak partisans and ticket-splitters” and included both Obama and McCain voters from 2008, became irritated when shown Obama ads touting economic improvement. They don’t see that improvement in their own lives, the report says, and they don’t believe Obama when he claims things are better.

“The spots that simply talk about progress on the economy did not do well,” Greenberg and Carville write. “The first offered a graphic depiction of job decline during the early months of the recession and job growth under President Obama. The second highlighted progress on jobs in the automobile industry. These ads did not win over most Obama voters….Half the participants in the groups had voted for Obama, but less than a quarter gave [the auto ad] a positive rating. The spot displaying the job growth graph did not fare much better: only about one-third (12 out of 34) gave this a positive rating.”

“It’s like how things are getting better? Where?” asked one non-college-educated woman in Columbia, Ohio. “I don’t see it. Makes me mad.” Even Obama’s oft-made claim that he saved the auto industry angered some. “The auto industry spot, surprisingly, produces a lot of resentment,” Greenberg and Carville write. “Women in particular did not see how it related to them, and even some men working outside manufacturing thought it left them out.” As one woman in Ohio said: “Good job for the autoworkers, but where does that leave my grandchildren?”

After extensive interviews with the groups, Greenberg and Carville conclude that Obama’s current campaign message — that he inherited a terrible economy but that now things are getting better — is disastrously wrong. “We will face an impossible headwind in November if we do not move to a new narrative,” Greenberg and Carville write, “one that contextualizes the recovery but, more importantly, focuses on what we will do to make a better future for the middle class.”

“It is elites who are creating a conventional wisdom that an incumbent president must run on his economic performance — and therefore must convince voters that things are moving in the right direction,” Greenberg and Carville conclude. “They are wrong, and that will fail.”

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Before you get too excited, the voters don’t like Romney much either. If ever there was a year for a third-party candidate to win, this is it. The only problem is there isn’t one. Well, there is one, but she ain’t running.

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Is more government the answer?

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E.J. Dionne:

Government is the solution

Why don’t Democrats just say it? They really believe in active government and think it does good and valuable things. One of those valuable things is that government creates jobs — yes, really — and also the conditions under which more jobs can be created.

You probably read that and thought: But don’t Democrats and liberals say this all the time? Actually, the answer is no. It’s Republicans and conservatives who usually say that Democrats and liberals believe in government. Progressive politicians often respond by apologizing for their view of government, or qualifying it, or shifting as fast as the speed of light from mumbled support for government to robust affirmations of their faith in the private sector.

[...]

Decades of anti-government rhetoric have made liberals wary of claiming their legacy as supporters of the state’s positive role. That’s why they have had so much trouble making the case for President Obama’s stimulus program passed by Congress in 2009. It ought to be perfectly obvious: When the private sector is no longer investing, the economy will spin downward unless the government takes on the task of investing. And such investments — in transportation and clean energy, refurbished schools and the education of the next generation — can prime future growth.

[...]

Let’s turn Ronald Reagan’s declaration on its head: Opposition to government isn’t the solution. Opposition to government was and remains the problem. It is past time that we affirm government’s ability to heal the economy, and its responsibility for doing so.

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The older I get the more I appreciate the wisdom of guys like Tom Jefferson and Jim Madison. I consider them to be two of the brightest political philosophers that ever lived. They joined with a number of contemporaries like Franklin, Adams, Washington, Marshall and Hamilton to create something unique in history – a government of the people, by the people and for the people.

But our Founding Fathers were never in complete agreement. Some wanted a strong central government. Some wanted no central government at all. Most of them agreed that government is a poor servant and a terrible master. What they came up with was a limited government with enumerated powers. A government whose powers were divided up. A government that was prohibited from doing certain things.

The Founding Fathers realized that some government is necessary but too much government is bad. The real question is how much is just right? It’s been over two hundred years and we haven’t settled on an answer.

Dionne offers us a false choice. Government spending can stimulate the economy. But that does not mean that the best way to do that is hiring more government workers or investing in clean energy. Half a billion dollars was wasted on Solyndra alone. How many jobs were created? How many still exist?

For that same amount of money we could have given 500,000 unemployed people $1000 checks every month for ten months. $1000 may not seem like a lot to some people but when you’re broke it’s a huge amount. Every damn one of them would have spent that money, stimulating their local economies.

The Obama Stimulus borrowed and spent $750 BILLION, and created only 3.3 MILLION jobs. According to my meager math skills that’s nearly $230,000 per job created.

And now they want to do it again.

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That was fast

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New GOP ad “The private sector is doing fine.“

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I love a good rant

WMCB

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She’s a pistol:

And see, THIS is why Americans have become so stubborn on the issue of tax increases on anyone. They want the debt and budget dealt with, and “tax increases on the wealthy” are always sold as being a way to do that (even if it’s only a drop in the bucket.)

But we know they won’t be used for that. They NEVER are. The minute you give DC a nice little pot of extra money, they refuse to pay down the credit card, but instead find something new to spend it on.

Obama’s new ad admits it. The Buffet Rule, sold to the public as a debt-reducer, suddenly needs to be passed so Obama can spend it on a “jobs” stimulus. If every time I gave someone a check to go pay the mortgage they instead came home with a new stereo, eventually I’d reach the point where I’M NOT HANDING YOU ANY MORE FUCKING CHECKS. And DO NOT then whine to me that I’m the one who doesn’t care about the mortgage. Because you are full of shit.

I’m really tired of being continually told by a repeatedly untrustworthy entity that the fact that I don’t trust them is my failing and there is something wrong with me. Fuck you.

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I’ve said many times before that I believe in Keynesian economics. During tough economic times the government can keep the economy moving by using deficit spending to stimulate it. But two key points: The loan must eventually be paid back and the money must be spent in ways that actually, you know, stimulate.

There is an old saying that “Politics is the art of the possible.” In early 2009 a stimulus was possible. But Obama and the Democrats screwed it up. They ignored the experts and passed one that wasn’t big enough, then spent the money in the wrong places. We would be a lot better off if they just handed out $1000 checks every month to every unemployed adult in the country.

Those people would have paid rent and bought groceries and other necessities. The money flowing into stores would have gone to pay workers and buy new products to sell. This would have created all kinds of new jobs in a ripple effect. Eventually the 1%ers would get it, but not until it passed thru a lot of other hands.

Obama and the Democrats basically just gave it directly to the 1%ers. Not only did it not stimulate the economy, they managed in the process to discredit Keynes theory. Now the voters (who are on the hook to pay the money back) aren’t willing to float another big loan.

They are willing to deal with some austerity. Most of them understand doing without. You can talk until you are blue in the face about how the federal budget isn’t like a household budget. You can tell them that austerity will delay the recovery. They still aren’t giving any more money to someone who spends like a crackhead with a stolen credit card.

Don’t blame me, I voted for Hillary.

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Huh?

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Barack Obama:

Well, first of all, I think Cory Booker is an outstanding mayor. He is doing great work in Newark and obviously helping to turn that city around. And I think it’s important to recognize that this issue is not a “distraction.” This is part of the debate that we’re going to be having in this election campaign about how do we create an economy where everybody from top to bottom, folks on Wall Street and folks on Main Street, have a shot at success and if they’re working hard and they’re acting responsibly, that they’re able to live out the American Dream.

Now, I think my view of private equity is that it is set up to maximize profits. And that’s a healthy part of the free market. That’s part of the role of a lot of business people. That’s not unique to private equity. And as I think my representatives have said repeatedly, and I will say today, I think there are folks who do good work in that area. And there are times where they identify the capacity for the economy to create new jobs or new industries, but understand that their priority is to maximize profits. And that’s not always going to be good for communities or businesses or workers.

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So, Mr. President, you agree with Mitt Romney? Then why did you bring it up in the first place?

And the reason this is relevant to the campaign is because my opponent, Governor Romney, his main calling card for why he thinks he should be President is his business expertise. He is not going out there touting his experience in Massachusetts. He is saying, I’m a business guy and I know how to fix it, and this is his business.

And when you’re President, as opposed to the head of a private equity firm, then your job is not simply to maximize profits. Your job is to figure out how everybody in the country has a fair shot. Your job is to think about those workers who got laid off and how are we paying for their retraining. Your job is to think about how those communities can start creating new clusters so that they can attract new businesses. Your job as President is to think about how do we set up a equitable tax system so that everybody is paying their fair share that allows us then to invest in science and technology and infrastructure, all of which are going to help us grow.

And so, if your main argument for how to grow the economy is I knew how to make a lot of money for investors, then you’re missing what this job is about. It doesn’t mean you weren’t good at private equity, but that’s not what my job is as President. My job is to take into account everybody, not just some. My job is to make sure that the country is growing not just now, but 10 years from now and 20 years from now.

So to repeat, this is not a distraction. This is what this campaign is going to be about — is what is a strategy for us to move this country forward in a way where everybody can succeed? And that means I’ve got to think about those workers in that video just as much as I’m thinking about folks who have been much more successful.

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Okay, Mr. Preezy, fair enough. Running the country is not like running a business. It’s not like community organizing either. But it seems to me like you are saying that what Romney did at Bain Capital was okay. That’s not what your campaign ads are saying.

BTW – Mitt Romney has experience at running a state, too. He even enacted health care reform while he was at it. Do you care to comment on that?

Hello? Hello?

Where did the Preezy go?

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Obama spokesman Ben LaBolt cannot/will not answer questions on private equity hypocrisy:

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