TCS Daily


Wealth and Nations

By Alvaro Vargas Llosa - October 29, 2007 12:00 AM

MONTERREY, Mexico -- Is global capitalism making the poor even poorer, or is it in fact rescuing millions of people out of their misery?

I recently had the chance to participate in a series of debates here about this issue organized by Foreign Policy magazine and Letras Libres, a Mexican cultural publication  Nothing I heard at that meeting changed my conviction that the glass is half-full despite the doomsayers who predict horrific calamities.

Ever since the Industrial Revolution, poverty has been significantly reduced throughout the world. Two hundred years ago, the average income per person worldwide was the equivalent of less than $2 a day; the figure is $17 today. This fact is relevant to the current discussion on globalization because, even though the information technology revolution, biotechnology, the emergence of new world players and outsourcing may give us the impression that we are in the midst of something entirely new, we are simply witnessing a new phase in the process of innovation that is the market economy -- and this began a few hundred years ago.

The fact that 20 percent of the world's population is extremely poor should not make us forget that millions of lives have improved dramatically in the last three decades. Illiteracy has dropped from 44 percent to 18 percent, and only three countries out of a total of 102 included in the U.N.'s Human Development Index have seen their socioeconomic conditions deteriorate. China's economy used to represent one-26th of the average economy of the countries that comprise the Organization for Economic Cooperation and Development; today it represents one-sixth.

These are not arcane facts. They are widely available and easy to understand. Publications such as Indur Goklany's "The Improving State of the World," David Dollar and Aart Kraay's report on the global economy, and Francois Bourguignon and Christian Morrisson's "Inequality Among World Citizens" -- to mention but three among many recent studies -- provide overwhelming evidence that the world is better off thanks to the increased flow of capital, goods, services and ideas.

All of which falls on the face of those who predict that in the next few years we will see a massive concentration of wealth among a few winners who will leave millions of losers behind. While it is probably true that the gap between low-skilled workers and those who are better educated will mean that different people will be impacted in very different ways by the continuing evolution of the global economy, the reality is that even those on the bottom rungs stand to benefit from the worldwide embrace of globalization.

Poverty was the natural condition of all of humanity until the market economy opened up the possibility of ever-increasing productivity. By 2030, it is estimated that the average wealth of developing countries will be equivalent to that of the Czech Republic today ($22,000 per person). The World Bank's recent "Global Economic Prospects" report goes as far as to say that Mexico, Turkey and China will equal Spain's current state of development, which is high.

At the recent meeting in Monterrey, those who were trying to justify their phobia against globalization pointed to Cuba and Venezuela as paradigms of development, and to Mexico's poor in claiming that increased trade -- through the North American Free Trade Agreement -- shortchanges the masses.

In 1953, Cuba's wealth was comparable to that of the state of Mississippi; today, the island's exports total one-third of the sales of Bacardi rum products, the economic icon of the Cuban exile community. Venezuela's economic system is a classic case of state capitalism based on oil -- exactly what made that nation's per-capita income go from representing the equivalent of two-thirds of that of the United States in the 1950s to representing barely 15 percent today. And Mexico's slums are not a factor of that country's increased trade with its North American neighbors, which has quadrupled in the last 15 years, but of the slow pace of reform.

The world was not rich and suddenly turned poor. The progress of the market economy that began to free the world of its shackles continues at an even faster pace today despite the many restrictions still faced by the people who create wealth and exchange it, and despite the fears that these momentous times understandably inspire in those who have difficulty adapting. What a heartening thought.
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151 Comments

Poverty is the norm, not wealth
We should repeat this fact over and over and over again to anyone who complains about capitalism hurting the poor: poverty is the global-historical norm, wealth is what is new. Poverty has always been with us; wealth is the new kid on the block. Until that sinks in, we're going to continue to have people preventing the poor from having opportunities to improve their lives in the name of helping them.

Envy
""Envy according to the aspect of its object is contrary to charity, whence the soul derives its spiritual life... Charity rejoices in our neighbor's good, while envy grieves over it.""

In rescue work, you are taught not to risk your life to life to save another. Then there would be two to rescue, not just one.

In the airplane, you are instructed to put your O2 mask on first before helping others.

A system for creating wealth cannot be implemented in which everyone is instantly wealthy at the same time.

Time and disciipline are required.

But as long as envy persists, people will risk thier opportunity for wealth in order to take it away from others.

And the socialists claim they are 'for the little guy'.

Free trade question.
A busines article yesterday discussed how foreign investors are not investing in US securies because of the weak dollar. This would result in a worsening trade deficit.

If the dollar is weaker, won't US products be less expensive for the rest of the world? And foreign products will cost more to US consumers?

I'm not concerned about 'banlance of trade deficits' anyway, but the newspaper article didn't mention the other effects of a 'weak' dollar, increased US exports and tourism from abroad.

The Absurd Wealthy
The theme of this piece is so obviously true that only the absurd and blinkered wealthy could think otherwise. The dream of a poor child in Calcutta (or Darfur or Rio de Janeiro or Carracas or Havana or Mexico City) is to be a poor child in New York City or London or Stockholm.

It won't be long
Soon, it won't matter what western absurd rich people think, because the third world will have its own absurd rich trying to "help". With any luck, the average will have gone up enough that people will be able to resist the help.

Somewhere, in a dark place that they don't want to admit exists, many who want to "help" the poor are scared to death that the poor might gain enough that they are no longer in need of help.

How will socialism succeed without the poor?

Wealth all that matters?
Reading through these posts above does feel like being in a room with crackheads whispering to each other how great their rocks are. I'm just picking on you guys.

Actually, I agree with you to an extent, I fully support capitalism, I just don't have the narrow-minded zeal and self-aggrandizement about it. In other words, I'm mindful there are pros AND cons of capitalism. The pros will do fine on their own, the cons are where we should focus for improvement.

But a thought occurred to me too. All you guys are talking about is how great it is to grow wealth and spread wealth... Does wealth make people happier? In the country that leads the world in consumption of pharmaceuticals and anti-depressants, the most wealthy country in the world, what good does this wealth do? Other than fuel an economy and allow us to buy all our toys and junk to fill our giant houses.

Does being happy matter or is wealth all that matters?

"is wealth all that matters?"
Why don't you ask those workers in Dubai who make $150/month?
Or all those Mexicans coming to the USA to work for less than minimum wage.

Let's pull all those in poverty in the world up the US poverty line and ask if they are happier.

If wealth doesn't make you happy, you have a choice to give it away. Billions of others would like to have that choice.

now wealthier
Good article, but usually when we see such articles here, we have people saying that it's not even true that the world in general is richer now. One guy recently said that the Russians were richer before the fall of the commies. Another said that even they were richer in India before the British took it over. Indeed, the author mentioned Cuba, and some even say people are better off in Cuba!

No, it is not all that matters but as my Grandmother said;
"I have been both poor and rich and rich is better"

good point
But don't worry, poverty can never be erased. Desperate, abject, dismal poverty; maybe.

Poverty, like wealth, is a relative thing. Compared to Bill Gates, Donald Trump isn't doing so well, compared to most of us he is rich. What is poor? What is Poverty? Without a true defination of this, we don't have a real measuring stick to gauge how well we are doing in fighting poverty.

"Somewhere, in a dark place that they don't want to admit exists, many who want to "help" the poor are scared to death that the poor might gain enough that they are no longer in need of help."

A very true statement. Why is that? Because, if there are no more poor, than the wealthy have nothing to gauge their self worth on. Now this isn't meant to include all people of means; this is mostly those socialist left types who are always looking to help the poor… with someone elses money.

Dollars not wanted
You might be missing the more important point. If the dollar is sinking, investors are going to be shying away from anything denominated in dollars.

In a worst case, people might start trading oil in Euros. If so, we run the risk that people realize they don't NEED the mighty dollar. And they would stop subsidising our life style by loaning us back the dollars we spent on their goods by buying T-bills.

And the fiscal budget would collapse-- along with the American Way of Life. We'd be worse than the world's greatest debtor nation, we'd be the world's most bankrupt nation. Investors in the US Treasury would cash out and go elsewhere to store their wealth.

That's rather more significant than the idea that Japanese tourists start shopping for bargains here. So my guess is there could come a point where we decide the dollar is worth shoring up... at all costs.

Kind of turned around
"A very true statement. Why is that? Because, if there are no more poor, than the wealthy have nothing to gauge their self worth on. Now this isn't meant to include all people of means; this is mostly those socialist left types who are always looking to help the poor… with someone elses money."

No, actually I think most middle class jobholders are wondering why it is they pay THEIR money in to taxes, and see that money being spent on subsidies to Big Ag and Big Energy-- not to mention on a war nobody wants. Then they see people like you wanting to take away what they DO get for their investment-- Social Security, Medicare, workmen's comp, unemployment insurance, job training programs and student loans-- you know, things that allow the money people put in to be invested back in the American people.

I don't think they'd go for the line that they're just jealous of your wealth.

Saw an interesting thing on the news tonight (NBC). Warren Buffet tells us that without seeking any tax shelters, just taking advantage of the capital gains rates, he pays 17 percent of his income in on income and payroll taxes.

Then he asked his staff-- the receptionist, etc-- to tell him what they paid in taxes on their incomes. The average was 32 percent.

So the very wealthy don't pay more than the rest of us, as they endlessly shout. In fact they only pay half what we pay. And now you want to take away the benefits we're investing in.

It looks an awful lot like a class war most of us are losing, because we don't even realize we're in one.

Yes
It is called cutting the budget and ending deficit borrowing and this will mean reductions in social spending.

Instead we have politicians proposing massive tax hikes and massive social spending.

We must also encourage people to save and not spend.

That, and the role of GOVAGs in protecting or destroying wealth
The (Aristotelian) essence of GOVAGs is the moral sanction they enjoy to deprive people of their Liberty (even Life, in some cases). They do this by enjoying legal monopoly on threatening and on carrying out the threats.

Since the root of wealth is human mind and since human mind CAN NOT function without Liberty, GOVAGs CAN NOT create wealth.

They (GOVAGs) can only either protect the wealth (for the wealth creators) or appropriate it(essentially destroying it for the wealth creators).

This has to be repeated over and over and over again, until such thinking becomes the cultural norm in society.

GOVAG : noun : Acronym for GOVernment AGent. Any of the millions of people directly employed by local, provincial/state and/or central/federal Governments.

Easy-- just save more money
"Instead we have politicians proposing massive tax hikes and massive social spending."

Here's an article from May, 2000-- when the national debt was only $5.7 trillion.

http://archives.cnn.com/2000/ALLPOLITICS/stories/05/01/clinton.debt/

Irresponsible politicians have bloated this figure up to nine trillion, in only seven years. All we have to do is to re-adopt the same policies we had in the late 1990s to put the train back on the right track again.

BTW much of the debt is money we owe ourselves. The Social Security Trust Fund, for instance, is reserved for payments we have promised ourselves. To welch on such a debt would be akin to wiping out everyone's bank account, on the specious grounds that the move was needed to "keep the bank solvent".

No. We pay ourselves first. It was ridiculous to allow people so fiscally irresponsible to handle our finances. We now need to put them back in responsible hands. And reining in our unlimited war budget would be only the sane approach to begin with.

"We must also encourage people to save and not spend."

They don't need any encouragement-- they already know too well that one day they'll grow old, and will need to have put some savings aside.

The problem lies in the fact that half the country isn't making enough to meet expenses. And as easy credit has been provided to them, in lieu of a living wage, they've gone in debt to the bank.

Give them enough in wages to live on and they'll save prudently, against a future time of need. But for many of them, their time of need is right now. So they accrue more debt just to get by.

Dollars not wanted as much?
As some suggest, growing economies around the world create demand for their currencies.

Still didn't answer the question about how trade will be affected.

Dollar denominated products will be less expensive to the Euro or CD or other currencies.

And all the nations that export to the USA will not appreciate a weak dollar or they are exporting elsewhere or consuming it all at home.

How much tax does the middle class pay?
The wealthy pay more of the total tax.

Its a matter of record.

How will Socialism succeed ...
Socialism never did succeed in doing what it claimed. But if you mean "where will it find its adherents" ... it will find them among tenured professors, journalists, dreamers who believe everything they read, and students of fashionable colleges, none of whom suffer the effects of the socialism they espouse for others.

Will this affect trade?
I didn't answer the question about how trade will be affected? How about this:

Nations corporations and individuals with goods for sale will prefer taking their payment in a currency whose value is ascending, like the Euro. They will shun payment in sinking dollars.

Thus the United States could go from a country whose currency is in demand to a country from which capital is fleeing.

Answer your question?

Capital flows
The trouble with the paradigm the author is pushing is that the capital flows are all going the wrong way.

An old estimate (2002) shows $100 million leaving the developing countries every day, in the form of massive debt repayment. This essential capital is largely being extracted from the nest eggs of the three billion people now living on less than two dollars a day.

Those, of course, are the same three billion whose combined net worth is less than that of our 400 richest men (I think they're all men) on earth.

That, BTW, is more than the total number of people on earth sixty years ago. So I think we could say that poverty, as much as wealth, is increasing today.

But the chief canard is that capital is somehow being "invested" in developing countries-- a misconception carefully fostered by an army of apologists. In fact capital is being employed to extract mobile wealth from the Third World, in the form of gold, bauxite, col-tan ore, copper and let's not forget the oil.

Once the capital is deployed for business in this way, all the proceeds are repatriated to the homes of the investors. The only tangible benefit the host country ever sees is that a small number find employment in menial tasks, such as becoming security guards.

The capital only flows one way. Ask yourself why an investor would possibly want to leave any of it behind on the streets of some faraway country he doesn't intend to live in.

Eh? What did you say?
You must be hard of hearing. I just said that Warren Buffet, a good example of the super-rich, pays taxes at about half the rate of his office employees-- all typical of the middle class.

Put another way, his taxes are LOWER. Less high. Not as much.

The only reason most taxes come from the upper brackets is that they enjoy an inordinate share of the total money in circulation. They have a greater share of gain from our system, yet they pay less into it.

It's getting tougher to push Marxism these days.
But of course you won't call it that. Thank goodness many of us can see it for what it is. I hope nobody in India reads your post because all those guys working on that advanced computer services stuff for the US and others will be really insulted. I hope all the people in the jap auto plants in Thailand and elswhere also don't get angry with you. I hope all those places who have already had all those billions of debt already forgiven are really pisseedd at you too. I hope all the people (like me) who have invested in envronmental cleanup expertese companies in red china don't think you're an idiot for all your talk of 'extracting wealth', and class struggles, etc. They have also had enough of your tired, phoney marxism.

A living wage?
Roy, then get another job. Who said it was easy? Wages are determined by the market. The market deems low skill have lower wages. How is this different from any era? In fact, today they have some safety net. Did depression era workers?

In fact, if we had another depression I would expect anarchy. Unlike the 1930's, people today have no self discipline and self reliance is a alien concept.

Europe wants to buy corn from USA
The farmers take USD.

It's good for Europe because the Euro buys more dollars.

You want to by French cheese, if the cheese is priced in Euros, it will cost you more dollars.

It seems to me it comes down to what the USA has to sell and what the USA wants to buy.

If the R.O.W wants the USA to continue buy stuff, they will have to do what it takes to make their products competitive.


Warren Buffet can pay more if he wants. What a greedy bas*ard!

Dubai has to hire workers from DPRK
Workers from India are on strike in Dubai for higher wages.
They can now find higher paying work at home and won't have to work abroad.

The budge that needs reigning is socialist entitlements.
All you greedy old people keep demanding more entitlments from the government.

Put your money where your mouth is and demand an end to Medicare and SS entitlements. Make these programs REAL trust funds with REAL money in a bank. Not the Ponzi schemes they are today.

That's a buncha hooey Roy Bean
Ever heard of licensing taxes, royalties, concession fees, property taxes, windfall taxes, and extraction fees? In your opinion, what portion of the gross profit is an international corporation entitled to repatriate as net profit? For most oil giants, this is 10% to 15% of gross revenue (after repatriation taxes) and for mining companies it is even less.

Cut corporate taxes
" In recent news, Treasury man Paulson has in fact taken a strong-dollar step with his proposal to slash corporate tax rates. The former Goldman head honcho is working with House Ways and Means Chairman Charlie Rangel to reduce the 35 percent corporate tax rate all the way down to 25 percent. This is a terrific idea. Studies have shown that 70 percent of the benefits of a corporate tax cut would go to the American workforce, boosting jobs and wages."

http://www.townhall.com/columnists/column.aspx?UrlTitle=the_restoration_of_king_dollar&ns=LawrenceKudlow&dt=10/22/2007&page=2

State of the Future
"The whining and self-pity so prevalent in today’s America now face a formidable new foe: the United Nations. The world body released a report called “State of the Future” showing that global conditions have dramatically improved by every significant measure.

The world’s increasingly capitalist economy has developed at an unprecedented rate, and people nearly everywhere do better in terms of personal income, food availability, life expectancy, literacy, infant mortality, access to health care, access to safe water and much more. At current rates of growth, the report suggests “world poverty will be cut in half between 2000 and 2015.”"

http://michaelmedved.townhall.com/blog/g/3d7890eb-4cec-40b9-b5c0-27bc94c94adb

"People around the world are becoming healthier, wealthier, better educated, more peaceful, and
increasingly connected and they are living longer, but at the same time the world is more corrupt,
congested, warmer, and increasingly dangerous. Although the digital divide is beginning to close, income
gaps are still expanding around the world and unemployment continues to grow.
The global economy grew at 5.4% in 2006 to $66 trillion (PPP). The population grew 1.1%, increasing
the average world per capita income by 4.3%. At this rate world poverty will be cut by more than half
between 2000 and 2015, meeting the UN Millennium Development Goal for poverty reduction except
in sub-Saharan Africa."

"Although great human tragedies like Iraq and Darfur dominate the news, the vast majority of the
world is living in peace, conflicts actually decreased over the past decade, dialogues among differing
worldviews are growing, intra-state conflicts are increasingly being settled by international interventions,
and the number of refugees is falling. The number of African conflicts fell from a peak of 16 in 2002
to 5 in 2005."

"According to WHO, the world’s average life
expectancy is increasing from 48 years for those
born in 1955 to 73 years for those who will be
born in 2025. Global population is changing from
high mortality and high fertility to low mortality
and low fertility. Population may increase by
another 2.8 billion by 2050 before it begins to fall,
according to the UN’s lower forecast, after which
it could be 5.5 billion by 2100—which is 1 billion
fewer people than are alive today."

"According to Freedom House, the number
of free countries grew from 46 to 90 over the
past 30 years, accounting for 46% of the world's
population, and for the past several years 64% of
countries have been electoral democracies. Since
democracies tend not to fight each other and
since humanitarian crises are far more likely under
authoritarian than democratic regimes, the trend
toward democracy should lead to a more peaceful
future among nation states."

http://www.millennium-project.org/millennium/sof2007-exec-summ.pdf

thats bull
Studies have shown?? What studies? Not even Townhall.com, or Kudlow, is man enough to share links to the studies, or provide anything further as to what studies their referring.

"Studies have shown that 70 percent of the benefits of a corporate tax cut would go to the American workforce, boosting jobs and wages.""

See, I thought this statement is bogus because corporate taxes were already cut by GWB and what has been the evidence since then? Corporate profits soared, executive and CEO pay soared. Thats it. Workforce pay has been stagnant, not nearly keeping pace even with inflation. Jobs have been coming back a little bit, but thats a mixed bag because we first had to get out of the hole dug by the recession and all the jobs lost during that period, and new jobs have not been meeting expectations or historical averages for similar periods following a recession. Thats reality, oh, but he said "Studies have shown" so we should ignore reality and believe in the ideology.

So to claim 70% of the benefits of another corporate tax cut would go the workforce seems highly unlikely. Or is the idea that, executives and corporations have bathed in gold from the last tax cuts, now this time it would the workforce's turn? Yeah right. As if its not enough that the wealthy have all the advantages anyway, some feel it necessary to try and blow smoke up our arses about it also.

Just crazy. No, I'm not envious, in case any right wing tools are reading this. I know thats your first response.

Who pays corporate taxes?
A profitable corportion, in a free market, pays no taxes. It is an expense that must be rolled into the price of its products.

Lessons in Happiness (only $250 per hour)
Thhe pro's won't necessarily take care of themselves if people pass laws against the pro's, seeing them as con's.

Epicurus pointed out that happiness increases with amount of wealth up to a point, but then after that more wealth only results in very incremental amounts of happiness. He's probably right. But you do need to have enough money to be able to aford to have a home, transportation, clothing, be well-fed, and provide for entertainment. Food will contribute to happiness (in moderation). Entertainment will contribute to happiness (especially the right kinds, in moderation). Epicurus also said that learning and philosophical contemplation contribute to happiness -- so you probably need money for books and school. He also said having good friends contributed to happiness -- but if you need money for friends, they're not good friends anyway.

So you need a certain minimum amount of money to be happy. But balance is what you need overall in order to be happy in life.

How we got here
We paid into social insurance programs with the reasonable expectation that we would be getting something out. And in fact my generation will be getting something out. It's the next generation that's going to get cheated.

Instead, the money we gave the SS Administration for safe keeping has been pissed away by a complicit Congress on a program of endless wars and the creation of a National Security State. THAT is the waste.

Before the lock box was picked, there was actual cash in it. Among other things, the SS Trust Fund was a good way to retire debt. But Congress allowed themselves to borrow from it, so they could spend money without asking for taxes. And the taxpayer let them do it.

Since the 1970s the average wage earner has been losing out. He failed to obtain a share in the increase in productivity, he watched as his company pension plan was hollowed out from within, he never did get a national plan for health insurance, and now he'll be watching his SS and Medicare fizzle away.

Meanwhile no one has any serious doubt that the people enjoying unearned income will continue getting richer. It has become a zero sum game, with the wage earner losing at every turn.

Not India or Thailand
I thought it was apparent when I was talking about the three billion among us who earn less than two dolars a day, I was not referring to Indian subcontractors making $8-16,000 a year doing work that in this country would cost double that. I was talking about the next lower tier.

Countries dependent on extractive industries don't see any of the proceeds. Such a portion as their leaders take from the corporate enterpise as rent for their operations never hit the street in the form of developmental programs. Instead they buy Benzes for the waBenzi, and security.

The leadership in those countries collude to split the proceeds with the industries they invite in. What they don't spend on personal wealth goes to the police and armed forces, who protect the operation from their own people. Good examples can be found in Nigeria, the out islands of Indonesia and much of Latin America.

It's a closed system in which very little ever gets put into programs that will help the population get above a subsistence level. And it is just these states, that have been systematically excluded from the path to wealth creation, that have been most prey to those leaders you consider Marxist. Bolivia, Venezuela and Ecuador would be prime examples of places that have no better option than the radical socialist route.

So perhaps I could have used a more descriptive word than "emerging" states. These states are stagnant in every sense.

Thats a different subject
"A profitable corportion, in a free market, pays no taxes. It is an expense that must be rolled into the price of its products."

I agree, thats theoretically true. One, a corporation probably pays no taxes because they found a way to creatively account a way to pay no taxes. But if they're not led by Republicans... Two, they do pay taxes but its an expense figured in to the price of their product, to a degree, so you're right theoretically. But wrong too, because they do pay taxes.

But does that also mean when taxes are lowered the price of their product will also go down? Of course not.


But this isn't even the point in the discussion, this is a different subject. Are you saying I'm correct in my last post? I must be right if you're changing the subject. I copy and pasted it below so you can refresh your memory easier if you need to.


bobjones:
"Studies have shown?? What studies? Not even Townhall.com, or Kudlow, is man enough to share links to the studies, or provide anything further as to what studies their referring.

"Studies have shown that 70 percent of the benefits of a corporate tax cut would go to the American workforce, boosting jobs and wages.""

See, I thought this statement is bogus because corporate taxes were already cut by GWB and what has been the evidence since then? Corporate profits soared, executive and CEO pay soared. Thats it. Workforce pay has been stagnant, not nearly keeping pace even with inflation. Jobs have been coming back a little bit, but thats a mixed bag because we first had to get out of the hole dug by the recession and all the jobs lost during that period, and new jobs have not been meeting expectations or historical averages for similar periods following a recession. Thats reality, oh, but he said "Studies have shown" so we should ignore reality and believe in the ideology.

So to claim 70% of the benefits of another corporate tax cut would go the workforce seems highly unlikely. Or is the idea that, executives and corporations have bathed in gold from the last tax cuts, now this time it would the workforce's turn? Yeah right. As if its not enough that the wealthy have all the advantages anyway, some feel it necessary to try and blow smoke up our arses about it also.

Just crazy. No, I'm not envious, in case any right wing tools are reading this. I know thats your first response."

There was NEVER a real trust fund.
It was a Ponzi scheme from the beginning.

And all you old folks don't care.

Why does it matter?
If the customers pay all corporate taxes, all profit and all expenses, wouldn't cutting taxes have a positive effect upon a company?

Seems like a no brainer to me.

Why don't you support ending the influence of the government in the market place and let the free market control all those greedy CEOs?

You have to debate this...?
Gees, I would think this is more than obvious.

The Trust Fund
This Ponzi Scheme thing is just a knee jerk opinion that's been hard wired into your DNA... and I know I won't dislodge it here. But the set-aside was established in the reformulation of Social Security in 1983, where a reserve would be held against the maturation of the Baby Boomers-- our famous demographic pig in the python.

Once the Trust Fund was set up to contain really big bucks it didn't take Congress long to look at all that cash laying around and say we could put that to really good use. So they passed legislation enabling them to borrow and spend it. THAT was the point where the lock box was filled, not with cash temporarily retired from service, but Treasury IOUs.

In any case, do you have any T-bills in your portfolio? Do you think of them as being a safe place to leave your excess cash? The Treasury lawfully owes that debt, and has promised to pay with the "full faith and credit" of the United States.

Starting in 2018 we will need to begin drawing on that account. And they will pay us back or the government of the day is very likely to fall.

Creepy
It's an interesting insight into the creepiness of your mind that Warren Buffet has called attention to the fact that billionaires like him pay only half the taxes their employees do-- yet for you, he's the greedy bas****.

While on these pages we have daily apologias for the two tiered economic system, where one group profits from the labors of the other. And those people, for you, are just visionaries, patriots and godly men.

Examining some evidence
Your comment is worth examining closely, as you profess expertise in this area. Let's take a look at two instances of extractive industries: Chevron in Nigeria and Grasberg, in Indonesia's Irian Jaya province.

I'll let the first article speak for itself:

http://www.gasandoil.com/goc/company/cna53526.htm

I don't know about you, but I didn't come away with the feeling that justice was going along swimmingly. It looks more like a collusion between thieves... the government and the developer bickering over how to share the spoils.

In fact the population of Nigeria has not only failed to see any benefit from the industry but has seen its lands poisoned, fisheries destroyed and villages evicted for being in the way of an industry that has laid waste the entire Niger Delta. Strikes are now so widespread as to be on the verge of paralyzing the industry. And I do not believe this comes from the essential evil of the people. All evidence points to the great injustice they suffer from Oil.

Let's take a look at Grasberg, where the Indonesian Army serves as company guards across a large area taken without compensation from the inhabitants, killing them whenever protests raise their anxiety level.

The operators, Freeport McMoran, are in fact the Indonesian government's largest source of revenue. Without their funding it would not be possible for that country to support the army that keeps its colonies in place.

And among those colonies is Irian Jaya, the one in which the world's largest copper mine and an immensely profitable source of gold is located. The native population gets no share in these revenues, which are once again split between the occupier, Indonesia, and the operator.

Complaints are dealt with harshly. Although I will say that the miners themselves, after striking, are now getting decent wages, something over $3,000 a year for their labors. So, from the operation there are some thousands of beneficiaries... while the environmental devastation covers an immense area, including the poisoned waters that once provided food for the native population. And the natives have traded their state of undeveloped self sufficiency for one of urban poverty and sharply rising crime.

But here's the prettied up version:

http://www.businessweek.com/magazine/content/06_22/b3986086.htm?sub=bw50

I see though where Freeport has somehow managed to earn a 22% profit... $935 million on a $4.2 billion gross. So it would seem that both the operator and the Indonesian Army are doing quite well on the deal, and only Irian Jaya has been the loser.

Both these instances are object lessons that illuminate both your view of all this and mine.

"no better option than the radical socialist route"
You said you maybe should have used a more descriptive word and emreging. Right, maybe you should have said that, even though most of the world is getting amzingling richer, there are still some examples I can find where they are so rotten and corrupt that the people aren't getting too much richer. That would have been more accurtate.
But it's really funny that you say that they have no better option than more socialism. What about the obviously better route of more capitalism? That would never occur to you. Because of their lack of freedom, that means lack of capitalism, by their lousy dictators, they suffer. The last option should be socialism, but that's your bias as an authoritarian.

not obvious
to everybody, guys like Roy, and Lemuel wont' admit that the world is richer, and seek more socialism instead. But they won't call it socialism, they just say that more beaurocrats have have economic power to have command economies and take away more freedoms from individuals.

Some trust fund.
That's why you need to depend upon the government?

There are significantly more places to invest money than with the US government.

How much money does Buffet spend to AVOID paying taxes?
People like him spend millions on attourneys and accountants to avoid paying taxes.

If Buffet thinks he is pays too little in taxes, the government takes donations.

And please be specific about what you mean by "only half the taxes". What taxes? Dollars? Rates? What?

Class warfare is what is really creepy and dangerous.
Yet you are not afraid to engage just as FDR and the other socialists did.

what has changed
The biggest change is that govt has been spending money like a drunked sailor over the last 7 years.

I agree with roy completely, we need to get govt spending back under control.

As to the SS trust fund. There never was such a beast. The govt has always spent this money faster than it came in.

Another of the changes in the last 7 years, is that the baby boomers have begun retiring. As a result, the surplus from the SS trust fund has begun to shrink. Which has the affect of making the deficit look bigger.

living wages
roy likes to think that businesses are piggy banks. Just ask nicely, and the money will come rolling out.

roy also claims that if only we would give people enough money, they would save it.

From whence does such a fantasy come? I see no evidence that the majority of people making minimum wage would save a penny, even if we tripled their income.

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