On the Road to Socialism

[GTKeeper]

Read the story here:


http://www.nytimes.com/2008/10...ref=slogin&oref=slogin



Frankly, I am not surprised about this at all.

Just think in common terms and historical terms. What we have had over the last 10-15 years in the US is a massive shrinkage of the middle class and income disparity at an all time high.

If you look at history, you will see that this is an impossible trend to maintain where the middle class gets poorer and the rich get richer. Once a middle class shrinks enough, you end up having things like revolutions. (true for any society in history)

What the government is going to do now, is socialize much of our economy and essentially start to implement a massive 'reset' button in terms of income redistribution. Taxes will go higher for the wealthy, no doubt about that and the middle class will be backed up by tax - payer dollars.

Essentially, our broken system of government is to blame for all of this. Particularly lobbying and such attrocious things (in my opinion) as actual private institutions writing government legilslation. We essentially went through a semi-privatization of government (at least the way I look at it) where there was much less control and much more influence of the private sector in gov't than ever before.

Now we are going the other way, and in a very drastic way. We will over socialize and I am affraid we will never get to the era of the biggest economic boom which was the 1980-2000 period. People need to start setting expectations of lower standards of living in the future.

 

[dmcowen674]

Originally posted by: GTKeeper
Frankly, I am not surprised about this at all.

Just think in common terms and historical terms.

What we have had over the last 8 years in the US is a massive shrinkage of the middle class and income disparity at an all time high.

If you look at history, you will see that this is an impossible trend to maintain where the middle class gets poorer and the rich get richer.

Once a middle class shrinks enough, you end up having things like revolutions. (true for any society in history)

Essentially, our broken system of government is to blame for all of this.

Particularly lobbying and such attrocious things (in my opinion) as actual private institutions writing government legilslation. We essentially went through a semi-privatization of government (at least the way I look at it) where there was much less control and much more influence of the private sector in gov't than ever before.

Now we are going the other way, and in a very drastic way.

We will over socialize and I am affraid we will never get to the era of the biggest economic boom which was the 1980-2000 period.

People need to start setting expectations of lower standards of living in the future.

Made a correction for you.

The middle class was not shrinking under Clinton.

 

[StageLeft]

Apparently sweden did this to a true benefit.

However, if you want my opinion which is worth as much as the calories spent reading it, the government should nationalize to an extent now to ensure continued business lending but as part of this put in a legal decree that in, say, 18 months, their ownership legally has to go on the auction block so that these entities can go back to non-government ownership. The only way to avoid this would be a 60% majority congress vote against doing it, at which point it would then be revoted on a yearly basis. This way we are protected short-term from a possible total lending freeze but we get away from the prcedent and unending, indefinite ownership, if only partial, of banks by the government.

 

[Moonbeam]

Good. I hope the Post Office is next.

 

[Arkaign]

Originally posted by: Skoorb
Apparently sweden did this to a true benefit.

However, if you want my opinion which is worth as much as the calories spent reading it, the government should nationalize to an extent now to ensure continued business lending but as part of this put in a legal decree that in, say, 18 months, their ownership legally has to go on the auction block so that these entities can go back to non-government ownership. The only way to avoid this would be a 60% majority congress vote against doing it, at which point it would then be revoted on a yearly basis. This way we are protected short-term from a possible total lending freeze but we get away from the prcedent and unending, indefinite ownership, if only partial, of banks by the government.

Sweden has a very homogeneous population and strong cultural values, I hate to sound racist or whatever, but it really helps with cohesive implementation of socialism. Socialism does work when everyone is on the same page, Sweden is a very clean, happy, productive, interesting place. Is socialism the best solution? Hardly. But it can work with the right ingredients/population.

America does NOT have that homogeneous population. We're too diverse, too divided, and ultimately too lazy and selfish, for socialism to ever work. The burden of caring for the lazy underbelly of society (this cuts across all religious and racial boundaries, though certain groups are worse than others on average) will turn our country into a true cesspool.

 

[DAPUNISHER]

Essentially, our broken system of government is to blame for all of this. Particularly lobbying and such atrocious things (in my opinion) as actual private institutions writing government legislation. We essentially went through a semi-privatization of government (at least the way I look at it) where there was much less control and much more influence of the private sector in gov't than ever before.

Now we are going the other way, and in a very drastic way. We will over socialize and I am afraid we will never get to the era of the biggest economic boom which was the 1980-2000 period. People need to start setting expectations of lower standards of living in the future.

I agree except for the Standard of living comment, which I think is difficult to qualify. Standard of living is a term that is relative IMO. I would prefer a cleaner environment, U.S. sourced renewable energy, and far better mass transit infrastructure, to more gadgets, toys, and trinkets, being available for consumption. Frugal shouldn't be a bad word.

 

[Dufusyte]

Typically banks own the government.

 

[idiotekniQues]

this is not socialism, this is the road to fascism.

 

[Thump553]

England did this yesterday-a partial nationalization/government investment in certain large banks. Both major parties and the banks agreed to it. And yes, Sweden did it before, got out in a few years at a profit to the taxpayers.

Skoorb pretty much hit the nail on the head-it's got to be temporary. Our immediate problem is banks are scared to death of lending to anyone, including each other, because there are so many negative surprises coming to light recently (based on crappy regulation and irresponsible bank officials, in my opinion). The bailout last week will help if done right-some day a few weeks or months down the road.

I heard the term yesterday "helicopter money" meaning the government is throwing a bunch of cash out the window, hoping it gets picked up and put to a use that will pump the economy.

The Fed has already started a program to buy commercial paper and is talking about extending lending to individuals.

I wouldn't rule out such a temporary program. It very well could be the best way to get the cash to the right place to stop the slide. Better than the government competing with the bankers (like buying the commercial paper).

 

[GTKeeper]

Originally posted by: DAPUNISHER

Essentially, our broken system of government is to blame for all of this. Particularly lobbying and such atrocious things (in my opinion) as actual private institutions writing government legislation. We essentially went through a semi-privatization of government (at least the way I look at it) where there was much less control and much more influence of the private sector in gov't than ever before.

Now we are going the other way, and in a very drastic way. We will over socialize and I am afraid we will never get to the era of the biggest economic boom which was the 1980-2000 period. People need to start setting expectations of lower standards of living in the future.

I agree except for the Standard of living comment, which I think is difficult to qualify. Standard of living is a term that is relative IMO. I would prefer a cleaner environment, U.S. sourced renewable energy, and far better mass transit infrastructure, to more gadgets, toys, and trinkets, being available for consumption. Frugal shouldn't be a bad word.

Good point. I don't think all socialism is bad. In Germany and France all rail systems that are 'private' are subsidized by the government because if it was a purely private entity it wouldn't make a profit. I think its also hard to guage the benefit of mass transit. I think the overall societal cost is lower than everyone driving a car. And all the people that spend 50 bucks a / month on a rail pass can use the other 200 they would have spent on gas on other goods.

 

[Zedtom]

What I find interesting is right leaning talk show hosts are constantly attacking proposals by Democrats to broaden government healthcare coverage as creeping socialism. The most irritating description is that it's a slippery slope- whatever the hell that means.

 

[retrospooty]

BAh... the damage is done. There is no choice now. Its either massive depression, or govt. involvement.

Anyone with a better plan, please enlighten us/

 

[Moonbeam]

Originally posted by: Zedtom
What I find interesting is right leaning talk show hosts are constantly attacking proposals by Democrats to broaden government healthcare coverage as creeping socialism. The most irritating description is that it's a slippery slope- whatever the hell that means.

It means they use fear to protect donations from the AMA and medical insurance industry.

 

[zephyrprime]

You're overstating it when claiming that this will lead to socialism. Yes, the policy is socialist but taking over insolvent banks is a common way to deal with financial crises.

 

[Fern]

On the Road to Socialism

Gov thinking of buying stocks in banks

I think you have it wrong, very wrong.

If I'm not mistaken, the stock the goverment is permitted to buy is non-voting preferred stock. I.e., the government will not have control (no vote) over the companies whose stock they pruchase.

Socialism means government control. No control here (other than restriction on exec comp, but regular *capitalistic* lenders can exercise these kinds of restrictions when providing financing). So, it's not socialism.

I think it better described as example of our federal government engaging in capitalism (not socialism). It is investing in stock (I presume at a price to be negotiated as called for in the House bill) in order to (1) safeguard it's investment and (2) possibly profit - that's hardly socialism.

Sure, the federal government has taken over some troubled financial institutions also, but that's rather normal and is done all the time (although far fewer incididents), no one has claimed before that that was socialism. It wasn't then, it isn't now.

Fern