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Author Topic:   Socialism bailing out capitalism? (The Federal Reserve and the Banking problems)
Adminnemooseus
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Posts: 3974
Joined: 09-26-2002


Message 31 of 38 (461484)
03-25-2008 8:00 PM
Reply to: Message 30 by Grizz
03-25-2008 7:48 PM


Trying to head off a topic derailment
We say the same about Executive salaries and to us they seem ridiculously excessive, and to me they are. The fact is, however, that is what the corporations are willing to pay the executives to run the company. Again, it is supply and demand. That's the current asking price for a CEO. Without the salary, no CEO. The money to pay the salary does not materialize out of nowhere and they are not getting it for free.
I would love to see this theme pursued, but it does not belong in this topic. You're welcome, however, to start a new topic in the Coffee House.
Adminnemooseus

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randman 
Suspended Member (Idle past 4899 days)
Posts: 6367
Joined: 05-26-2005


Message 32 of 38 (461486)
03-25-2008 8:06 PM
Reply to: Message 30 by Grizz
03-25-2008 7:48 PM


It's called something like the fractional reserve banking system....plus, the FED can print as much money as they want and lend it to banks at whatever rates they want. That's money out of thin air, or minus the cost of printing and I think the Treasury picks up the tab for that anyway.

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Grizz
Member (Idle past 5471 days)
Posts: 318
Joined: 06-08-2007


Message 33 of 38 (461489)
03-25-2008 8:20 PM
Reply to: Message 31 by Adminnemooseus
03-25-2008 8:00 PM


Re: Trying to head off a topic derailment
Sorry. I rarely get to discuss this topic with anyone so I was all fired up.
In response to the initital question - I do not see the BSC bailout as Socialism bailing out Capitalism. I see such things as prudent amd neccessary measures in a free-market economy. One could certainly call it a Socialist intervention, but this is simply semantics. As I stated in an earlier post, Socialism and Capitalism are not mututally exclusive. They can actually complement each other quite nicely.
The US economy actually has elements of both - not with the same mix as Europe or Canada, but the US is far from being a pure Capitalist enterprise. My opinion is the Government should intervene if it will benefit the overall economic stability of the nation.
{Added by edit: The potential topic derailment at message 30 has been redirected to a new topic, Executive Salaries and Corn Flakes. - Adminnemooseus}
Edited by Adminnemooseus, : See "Added by edit" above.

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Jaderis
Member (Idle past 3425 days)
Posts: 622
From: NY,NY
Joined: 06-16-2006


Message 34 of 38 (462418)
04-03-2008 4:08 AM
Reply to: Message 25 by Grizz
03-24-2008 6:49 PM


Sorry it took me so long to get back to this.
It would take an expert on international trade to really offer up any serious opinions on that. I wouldn't know where to start to be honest. The only thing that comes to mind is what everyone else is thinking --to keep corporations from going overseas, offer tax breaks.
I don't think that is the only alternative.
We could also impose larger tariffs on "American" companies who choose to outsource or otherwise move production overseas.
We could also impose punitive tariffs on companies who refuse to meet certain environmental or labor standards when they choose to move their production overseas in order to avoid our (more expensive) standards.
Tax breaks only hold off the inevitable loss of American jobs. They do not provide any kind of real, long-term incentive to keep jobs here and they also, at the same time, strip much needed money from the government to help those affected by corporate bankruptcy/downsizing, outsourcing, etc.
States and cities often compete to offer the highest tax breaks to entice a company to relocate there, but there is no guarantee that after the tax breaks, road building, school building, downtown renovation, environmental exemptions, etc the company will stay. Some tax breaks could be used in tandem with other measures, like, say, they have to guarantee a certain amount of jobs or if they jump ship they have to pay back the amount they received in tax breaks.
Yeah, it is "protectionist," but this country and others were made "great" by protectionist policies. And developing countries could also be made "great" through protectionist policies of their own (just like we had in our infancy). But those who try to do so are deemed to be hostile enemies and must be crushed.
Our policies right now are still protectionist...just that we are protecting the corporations and not the workers, neither here nor elsewhere. It is a win-win for the companies and a complete and utter failure for workers.

"You are metaphysicians. You can prove anything by metaphysics; and having done so, every metaphysician can prove every other metaphysician wrong--to his own satisfaction. You are anarchists in the realm of thought. And you are mad cosmos-makers. Each of you dwells in a cosmos of his own making, created out of his own fancies and desires. You do not know the real world in which you live, and your thinking has no place in the real world except in so far as it is phenomena of mental aberration." -The Iron Heel by Jack London
"Hazards exist that are not marked" - some bar in Chelsea

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Silent H
Member (Idle past 5819 days)
Posts: 7405
From: satellite of love
Joined: 12-11-2002


Message 35 of 38 (462467)
04-03-2008 5:23 PM
Reply to: Message 5 by Chiroptera
03-23-2008 3:18 PM


Senators Cry Socialism!
A Yahoo News Article states that some senators have begun investigating the Bears Stearns bailout. An interesting section...
Lawmakers voiced worries that the taxpayer-supported bailout would encourage financial firms to speculate more aggressively, and expect government aid if they get into difficulties.
"The Fed has set a new precedent. Such policy decisions must be fully considered by this committee," said Republican Senator Richard Shelby.
Other senators were adamant that taxpayer money should not be put at such risk.
"That is socialism. And it must not happen again," Bunning said...
But something else caught my eye as well. I remembered this comment from Chiro...
The saying among us dippy hippy left wing types concerning American capitalism is: "profit has been privatized, risk has been socialized."
Heheheh, check this out...
"What it looks like if I had to frame this to people is that we've socialized risk and privatized reward," the panel's Democratic chairman, Senator Christopher Dodd, said.
Ahhhh, I always did like that guy.

h
"Civilized men are more discourteous than savages because they know they can be impolite without having their skulls split, as a general thing." - Robert E. Howard

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Minnemooseus
Member
Posts: 3941
From: Duluth, Minnesota, U.S. (West end of Lake Superior)
Joined: 11-11-2001
Member Rating: 10.0


Message 36 of 38 (462556)
04-04-2008 11:11 PM


Our Confusing Economy, Explained - On NPR's "Fresh Air"
Only caught the end, but it seemed pretty good. Need to get back to it, to hear it all.
Our Confusing Economy, Explained : NPR
quote:
Perplexed by the U.S. economy? You're not alone. Law professor Michael Greenberger joins Fresh Air to explain the sub-prime mortgage crisis, credit defaults, the shaky future of other types of loans and what we can expect from the U.S. financial markets.
Greenberger is a professor at the University of Maryland School of Law and the director of the University's Center for Health and Homeland Security.
Link to audio feed available at the above linked page.
Moose

  
obvious Child
Member (Idle past 4115 days)
Posts: 661
Joined: 08-17-2006


Message 37 of 38 (462673)
04-06-2008 8:03 PM
Reply to: Message 34 by Jaderis
04-03-2008 4:08 AM


I think you're missing what is underlying this whole problem.
The American Economy is changing. Simply put, the US economy is not competitive in many industries. So obviously the thing to do is get out of those industries. The key problem here is that the US public education is so abysmal in producing students of the sciences and mathematics that we can't quickly adapt to the changing brain economy over brawn economy. Trying to halt the movement of MNCs to the developing world ignores the fundamentals of such a change. The answer to saving and creating jobs is not in halting existing MNCs from leaving but creating new brain jobs by cultivating a heavily science based education system.
Frankly, none of your examples (or many of those of the candidates competing for the White House) seem to address this problem.

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obvious Child
Member (Idle past 4115 days)
Posts: 661
Joined: 08-17-2006


Message 38 of 38 (462674)
04-06-2008 8:06 PM


Bear Sterns has essentially been Nationalized.
And they call this economy 'capitalist.'
US taxpayers got the debt that killed BS and MS got the revenue generating assets.

  
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