# I've Been Thinking: And Maybe It's REALLY a Bad Sign When People Like Me Get Disillusioned With The Economy?

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Jun 24, 2017 in Banking
edited Jun 24, 2017

I am well into my 70's, utterly patriotic in love with the USA...always confident I could live (and contribute my skills) with integrity, totally believing our politicians and economists would likewise maintain their part...with integrity and skill.

But I am ready to sign out of capitalism now, starting with what I saw with the old folks exploited in Iowa...until the plundering kills them early death. And in the two years since I got evicted, that situation seems to me more like industry standard rather than one rogue corporation. I am from the Vietnam era, and I know the cost of Vietnam...and the "free enterprise" to pillage and loot those frail oldsters is not what they fought for.

I am finding echoes of my experience on Internet/YouTube - and not loonies, either...people my generation, educated Harvard/Yale/Stanford, a retired economics professor emeritus from the University of Massachusetts, a theologian and Pulitzer Prize winning journalist...on and on...and in light of what I saw in Iowa, they make sense. I feel like these speakers/authors are trying to give us perspective, so we don't end up in more chaos/anarchy that gave rise to desperate leaders like Lenin/Stalin/Napoleon/Mao/the Kims of Korea...what I saw in Iowa cannot continue.

* * *

In a nutshell: Apparently, FDR literally saved capitalism after the Great Depression with his Keynesian New Deal...got people stabilized...but then by 1978 the wealthy had dismantled the New Deal, until by 2008 capitalism imploded itself AGAIN; arguably we have still not pulled out of that 2008 crash.

Bottom line seems to be that you need a strong middle class for an economy to thrive, and no way to get around that. And our present economic system is not democratic, decisions all top-down, the wealthy padding their own profit margin.

In this small SOLVED group, we have a broad spectrum of liberal through conservative perspective, another continent Europe, a soldier...your input sought and so welcome as you are willing.

Marianne Jun 25, 2017

Here in Europe, the different facettes of capitalist, imperial, feudal, absolutist and various other systems alternated, involving conflicts, wars and revolutions and other disasters, and the wealth of upper classes was often built on invasions, oppression, robbery, usurpation, plundering or slaving other ethnic groups or classes. History reminds often enough how the best intentions could degenerate and cause great harm.

The problems with overpopulation and the systematic violation of human rights in many parts of the world was one of the great taboos for too long, and even presently, "religious" fanatism, fake ideals, arbitrariness, various "traditional" abuses and one-sided strategies are adding fuel to the fire, increasing pre-existing conflicts and promoting violence. And conditions will remain unequal.

and

Virginia Marianne Jun 25, 2017

Dear Marianne, in our small SOLVED group you are the one who seems to have given lots of thought to this topic...it's rather new for me! You also have spent your life in Europe, where economies have alternated...in USA, maybe not so many changes as Europe.

I appreciate the links...learning from them, even though I don't understand everything...I think for me, my basic mistake is that I assumed we humankind were further along in compassion than we are.

* * *

You mention the conflicts, wars, revolutions...well, a huge concern I see is the future potential for violent clashes here in the USA if we cannot reverse this trend of corporate capitalism. These huge corporate interests may have blocked appeals for change, simply by "buying" the politics/elections, the judiciary, and the news media.

We did seem to run into that in Iowa, when my elderly friends tried to use my eviction to bring attention to their own distress. They appealed to newspapers, government agencies, even an expensive attorney; and even though people were dying, all avenues of redress were blocked (and conditions are still worsening there). The old people are considered as commodity, their purpose to bring profit for the corporation, and there seems no way out.

* * *

I was reading in your links about the various kinds of dialectics. I would like to see us come to the point where the dialectics (also redress of abuses) can occur WITHOUT violence...

Marianne Marianne Jun 28, 2017

Dear Virginia, we have no real oversight, and whatever they are representing, right, left, etc., all the systems seem to be controlled by big corporate or private interests, pulling the strings - on or behind the scenes.

Sadly enough, old people are becoming a lucrative business, as far as they can pay ...

Virginia Marianne Jun 29, 2017

Marianne your comments seem to indicate your own similar experience in Europe...I will tell you, the observations from you and O'Tink are helpful to me, both of you being good thinkers, good observers of humankind...

I have tended to believe that we, the USA and Europe, have the best possible resources for remedy of injustice and that we are steadily moving in that direction. Now I am no longer certain, at age 72 wondering if I have just been naïve again...

Also, now I am concerned that the USA my beloved home could be moving in the direction of anarchy, just because of ever-worsening standard of living, and the means of redress progressively closed off. So, I am actively looking at ideas for moving GENTLY to something finer, in the belief it is us older generation that help hold things steady with our life experience, our peace and wisdom...

Marianne Marianne Jun 29, 2017

Virginia, well said.

TheOtherTink Jun 26, 2017

I agree that what happened to you, Virginia, should not happen to anyone. But before we give up on capitalism entirely, we need to think about what it is to be replaced with. I don't think it is 100% socialism; even the social democrats of Europe, which many American liberals hold up as a model, have not given up on private enterprise.

I can't help but think of nearby New York City, run by a Mayor (de Blasio) who is about as far left as a Democrat can get.

On his website, de Blasio says he is committed to fighting income inequality, and indeed there have been things like rent controls for lower-income residents in NYC for many decades. But what does that encourage? The slumlords skimp on heat and repairs, and the situation is no better in public housing projects, where corruption by well-connected contractors is rife. (well-connected to the appropriate bureaucrats, that is).  And there are huge scandals of government workers getting absolutely outrageous retirement benefits by padding their "overtime" in the two or three years before retirement. As individuals, they are just as greedy as any robber baron.

And what else is there? The cost of living in NYC is sky-high; everything costs more.  There are very high sales taxes (8.875%), and city income taxes on top of state and federal income taxes.

The ultimate irony is that without Wall Street, NYC's economy would collapse overnight, Mayor de Blasio's phony pontifications notwithstanding.

So I don't know what the answer is, but I'm pretty sure that abolishing capitalism isn't it, at least not until we are sure we aren't replacing it with something worse.

Virginia TheOtherTink Jun 26, 2017

Very cogent, very well stated, ty O'Tink...your views so welcome because of a (tendency) conservative perspective you bring...the liberal mayor's link along with your report on his progress, are concerning...

Here is where I currently am, if you would be so kind...now that I have housing and thus more leisure to retrospect...I was assuming my experience was rather unique, 'old folks falling into the hands of ONE rogue corporation, an anomaly'...but in amazement, the Internet seems to indicate a possibility my experience is now something of a national standard, and typical.

So, probing deeper: The idea that indeed, it is a liberal elite (like NYC mayor) who advocate and obtain redress for the suffering and misery of the underclass. Perhaps in the American Revolution, that is the role filled by Washington, Jefferson and company...the Enlightenment ideals, certainly liberal for their time?

But now, I am reading, it may be that the current liberal elite has caved; either that or they are for some reason rendered ineffective...your NYC mayor mouths the proper liberal rhetoric, as did Obama, but none of them has been able to obtain amelioration for the underclasses...(the graph above)

* * *

Okay, to the crux: There seems to be an historical pattern that without an effective liberal class, you "vomit up" (the term I saw) unsavory folks like Napoleon, Lenin/Stalin..more currently Radovan Karadzić, Slobodan Milošević, Franjo Tuđman..(.this pattern I FIRST learned from you actually, ty!)

So, my current question (with no clear answer): Can we the common folk, you/me/Marianne/Rooster and ALL our ilk, just see deeply and somehow common people hold our own focus, stand our own ground? And I don't even fully understand what that focus would be...CERTAINLY we cannot give up the dynamic free enterprise aspect of capitalism...but how? Because it is also true that most people cannot do what I did, "throwing yourself under the train" to make a point...for most at age 70 it would be certain death.

***And I did just now go back and look at your ultimate irony...whew!

TheOtherTink TheOtherTink Jun 26, 2017

@ Virginia,

What can we common folk do?  Well, that goes to the crux of the assumptions of our Constitution, namely that a free and informed electorate will know enough to throw the rascals out when they see them.  It is here that I fear we are failing.  If the electorate can be convinced with soundbites, and doesn't have the slightest clue about what is really going on, then elections can be bought by the special interests, be they corporate, or labor or government worker unions, or whatever.

And the liberal elites don't really seem to care either, except to the extent that whatever they do perpetuates their hold on power and makes them wealthier.  They even seem to be rather tone-deaf too.  I couldn't help but laugh when I saw the picture they chose for de Blasio's own website.  I've seen more honest-looking used-car salesmen

Virginia TheOtherTink Jun 26, 2017

O'Tink, I also noticed what you mention in that mayoral photo...idk, I would have to see him walk his talk first...and it does not sound like that is happening.

And, you have mentioned before...the power of an informed electorate...but...is there a point at which we concede that has not worked, does not work? And if so, what is needed for course correction? Certainly educational system; however just today I saw that corporations are going into the charter school business now I think it was 2013 Baltimore, not for the sake of the children but because the US gov't. spends $6 billion annually, and they want it... I have been reading that currently corporations are ascendant, literally having$ bought all avenues of recourse (political, judiciary, media)...calling the U.S.A. a 'corporate state;' however, I am old enough to feel SURE I recall the labor unions were extremely corrupt, before they were neutralized by outsourcing and such...so, corporate interests 'won,' but would the so-called liberal institutions have been an effective counterbalance, even had they survived?

So; are there enough of us, with INFORMED integrity of motive, to find our way? The liberal, idealism spirit of the Founding Fathers in us common folk...?

TheOtherTink Jun 26, 2017

The chart you posted is really quite misleading (as I think its author meant it to be), because it does not take into account the size of the increases. For example, if the top 10% of income earners got a very small 0.1% raise, and the bottom 10% got no raise at all, the red bar would be at 100% and the blue bar would be at zero (as they almost are in the 2001-07 bar on the graph), and of course that appears shocking.

But in fact, incomes for all groups have been almost stagnant since 2000, under both Bush and Obama. The real increases in top incomes relative to lower incomes occurred earlier than that, under both Republicans and Democrats alike, as the chart below shows.

Virginia TheOtherTink Jun 26, 2017

Hmmm...interesting/good point about the graphs, O'Tink...I do recall taking a quick look at the source, and wondering in passing if this might be one of those purposely skewed to make a point...

However, even the graphs you posted...I have read that for a clear financial picture of these years 2008-2017, you really need to look at the top ONE-TENTH of one percent...i.e., 0.1% = 0.001 = 1/1000 persons...that is where the money ended up, the US Treasury plundered. (That might have been the top 1/2 of one percent, not sure I recall correctly now.)

Anyway, point taken, How To Lie With Statistics.

TheOtherTink TheOtherTink Jun 27, 2017

Ok, let's look at the top 1/10 of 1%.  This includes people like Warren Buffett and Bill Gates (and Obama and Gore and the Clintons, for that matter) with LOTS of money to invest, in real estate or the stock market, for example.

Since the stock market tripled in value between 2008 and 2017, naturally these people's share of the wealth increased immensely relative to people who had no investments beyond maybe their house. And the rich people would pay no income taxes on the appreciated investments unless they sold them and actually realized a cash profit, and then it would only be taxed at the capital gains rate of 20%.

So, WHO plundered the US Treasury?  A socialist would have to admit it was the US government itself; the government establishes the tax rates. And a stickier question is, suppose the rich people don't sell their investments, but just buy and hold.  Would the socialist say we should tax the increase in market value, even if that increase has not been realized in cash? Would he be prepared to give a tax rebate if the market value of the investment went down? I doubt it.  It would be more like an extension of the real-estate property tax concept to EVERY kind of property. (btw, property taxes on Long Island are astronomical, about 3% of the value of the house per year, so in 30 years, you have not only had to pay off your mortgage, you also have had to pay the entire value of your house yet again to the local government) I'm sure Bernie Sanders would be all for that.

TheOtherTink TheOtherTink Jun 27, 2017

@ Virginia,

I just had an apocalypse about the wealth distribution question, and the answer, in part at least, is perfectly OBVIOUS.

The US population since 1980 has increased from about 225 to 325 million people. As you yourself have noted, most of this increase was due to immigration, whereas in the preceding 35 years, 1945-1980, most of the population increase was due to the baby boom among people already established in the US.

And who are the new immigrants? Mostly poor people from Latin America who have no wealth, so obviously the average wealth of the lowest-10%-income people (or even the lowest 50%) will decline with such immigration, relative to those people who were already here and had accumulated some wealth.

I have NEVER seen this obvious demographic factor considered in the rhetoric one usually hears about wealth and income distribution.

Virginia TheOtherTink Jun 28, 2017

Hmmm...O'Tink, although I have not taken time to really contemplate your insight, at first look it truly does seem obvious...at least, the immigrants would skew the income curve heavily downward...around here, there are many immigrants from Russia as well as Hispanic...but the principle would remain the same...

Good pick-up. Sheesh!

Virginia TheOtherTink Jun 28, 2017

O'Tink, I just found your comments here...some of what you describe I have not experienced directly, which is to me really the best-maybe-only way to have confidence in what I am talking about...truly appalling tax rates, coupled with outlandish property values that could drive people from their homes if they bought in when prices were low. We actually HAVE seen prolly a lesser shadow of that in rural Washington State...

And considering the point of the US treasury plundering itself, IN THEORY that seems indeed true...as government sets the tax structures. But counterpoint what I believe MAY be true, because of my direct experience in Iowa, is that the large corporations have in essence "bought-and-own" the government. They do this by making government indebted through large contributions. (Oh, and btw this is NOT red v. blue, it is ALL of them...Clinton administration for example being one of the "worst" sell-outs.)

So, bottom line I found I had no recourse in Iowa, judiciary/media/gov't agencies...and even now, my aged friends in Iowa are still suffering. They indeed tried, even after I left, to use my eviction to appeal their own circumstance...again all avenues blocked. The theory is that when this "blocked appeal, no redress" becomes nationwide and ubiquitous, it has (in other countries) set the stage for social disintegration, the dangerous kind...vomiting up unsavory leaders.

Thus the exhortation I am seeing is for people to appeal injustice as much as possible, apply pressure, but always with great care to maintain peace and non-violence, thus avoiding triggers toward anarchy...very difficult for frail elderly, but I was able to do it; and as I learn more, I am ever more glad I did so.

TheOtherTink TheOtherTink Jun 28, 2017

I agree, Virginia, that the government is far too much under the control of special moneyed interests of all kinds (and not just corporate).

But what's the solution? Complete socialism, where, say, Microsoft and Apple would be run by government bureaucrats who can't be fired for incompetence or not turning a profit (no problem, just raise taxes)? Very soon, those enterprises would remind me of the old joke, "What would happen if the communists took over the Sahara? Answer: There would be a five-year plan, and then there would be a shortage of sand." Microsoft would still function, but it would be a lot clunkier than it now is, maybe like the NYC public transit system, dirty, not very safe, and subject to frequent breakdowns.

And complete socialism is not without its own old-boy network.  Who gets the cushiest government jobs? That's right, the well-connected Nomenklatura, as it was called in the Soviet Union. And what is worse, the whole country is organized into one great big company store, a monopoly of the most extreme kind.

The inefficiency of government enterprises is well-known. For example, my Dad, who is going to retire soon, had 12% of his salary put into a private retirement fund every year, and 12% (6% from salary, 6% from his employer, actually up to 7.5% from each by now) for Social Security. What will the respective payouts be? The private retirement plan will pay out TWO or THREE times as much as Social Security, even though roughly the same input payments were made to each plan. Part of the reason for this, of course, is that Congress routinely raids the Social Security Trust (trust? hah!) Fund and pays it back with current operating funds, thereby losing the benefits of compounding that the fund would otherwise have. The other reason is that operating overhead is higher for Social Security. The government labor unions have seen to it that government workers get paid MORE for the same job, and have MORE job security than their private-industry counterparts. (It used to be that one traded a lower salary for more security in government work.)

So yes, Virginia, I admire the good fight you fought.  Expose the crooks and the rascals as much as possible, wherever they may be. And they be everywhere.

Virginia TheOtherTink Jun 29, 2017

Yes, I will always feel I could not have done otherwise in Iowa...however, part of me wonders if I have been naïve in expecting humankind to behave better than we already have..."land of the free and the home of the brave"...not going to give up on that, but I fear we may be further from it than I realized.

TheOtherTink TheOtherTink Jun 29, 2017

No, Virginia, by all means don't give up on the land of the free.  We certainly have a lot that should have been done better — much better — but nevertheless there is much to love and lots of good people too.

Marianne TheOtherTink Jun 29, 2017

Dear Virginia, and dear T(h)ink, I did not find the words to tell you how much I am trying to understand and find a rational, but not too arbitrary, and mature approach, without ranting and overcriticising authorities in all the domains; in every case, we need to see our families, friends, neighbours, colleagues, municipalities, regions and countries accept to reconsider and rethink present-day conditions, systems, beliefs, taboos and limits and to be ready to act together, according to common motives and interests, which respect individual needs, skills and means, as changing attitudes and beliefs is a very long and tedious process.

And we need to think about how to deal with other people, from the beloved, acquaintances, contacts to strangers or rivals, without having fight or submit:

It is perhaps too much of an illusion, as there will always be "bad elements" in every group ...

But there is much hope.

Virginia TheOtherTink Jun 30, 2017

O'Tink, I am still reading quite a lot, and YouTube also...one concern that just occurred to me yesterday - and I feel rather ill about it...

I have read that after WWII, they interviewed some of the German people, who said they had no idea what was going on with the concentration camps and such...I am now to the point where I want to make certain I am not unawares of USA deviancies. I want to stop trusting so much, just because it is my own beloved country, especially with the possibility the deterioration might be quite far along. I have no children, but I do plan for my presence to contribute to peacefulness. (btw, your insights and fine mind are helpful in all this!)

* * *

The theologian-journalist (Pulitzer) that I listen to went to his own chaplain and asked; "Are we created to suffer?”

The chaplain's response: "Is there any love that isn't?"

Virginia TheOtherTink Jun 30, 2017

"subtle degrees
of domination and servitude
are what you know
as love"

Marianne TheOtherTink Jul 2, 2017

Yes, respect is older than humanity.

TheOtherTink TheOtherTink Jul 3, 2017

Virginia, I don't believe ordinary German citizens had no idea of what was going on.  There were millions of soldiers who saw much of it first-hand (even if they did not directly take part), and who could have told the people back home.

It is true that the very worst systematic extermination camps were kept as secret as possible, and were in Poland rather than in Germany proper, so I am willing to believe that ordinary citizens did not know the full extent of the crimes, but to have known nothing?  No, I don't think that's possible.

Virginia TheOtherTink Jul 3, 2017

O'Tink, I have read your comment twice now, and find it valuable. As you know these past weeks of discovery, in economics and politics, have been disheartening...shaking a long-time deep trust...

I am going to continue to read; there are intelligent, thoughtful, well-spoken people who SHOULD be members in a healthy establishment - the Pulitzer journalists, two professors emeritus in politics and economics, etc...some with best-selling books - and they are concerned about a possible slide toward totalitarianism and/or a corporate state, along with human rights abuses worse than I saw in Iowa.

To whatever extent all this may be true, ordinary people like me, little-old-lady-in-tennis-shoes, it would help for people like me not to ignore it.

Do I recall correctly, it was your grandparents who fled Germany?

TheOtherTink TheOtherTink Jul 3, 2017

Yes, grandparents and great-grandparents, in the mid-30s, by which time it was obvious to them that it was a criminal regime, and that it was not going to go away anytime soon.

Virginia TheOtherTink Jul 3, 2017

I think such discernment can be difficult, perhaps especially in a country like this one where the signals may be there, but less obvious....rhetorically you can wonder, could Germany have been turned around if people had spoken out sooner?

TheOtherTink TheOtherTink Jul 4, 2017

Not once the dictatorship was established, and that happened after the Reichstag fire, less than two months after Hitler was named chancellor.

Virginia TheOtherTink Jul 4, 2017

O'Tink that is a very relevant observation...not after the dictatorship was established.

I did pick up the Evans book from the library, which you appreciated so much; it must be the first two volumes, it is BIG. Will read one from the Princeton professor emeritus in politics, first...rather slow going for me, since I am new to the topic, no solid background.