The KGB Oracle Forums General Public Discussion (SPECIAL ACCESS) KGB Political Debate Central " I am the 1% - Lets talk " - Awesome article

As you may ir may nit know, a vast portion of the middle class do not pay into social security. Teachers, police, firemen, railroad workers, state, local, and county officials ALL pay into their own retirement systems. They dont pay into social security. In a county like the one I live in, which is in Californias central valley, about 90% of the people who arent on welfare work for the government in spme way. The other 10% own dairies and the tiny number of local businesses. All the other jobs are McJobs. Every place in town takes food stamps. I digress.

So the first problem is that most of the tax base doesnt pay into the system. The second problem is that there is no longer a work-credit component to social security. 2 examples: one of my loser students, a gang member covered with tattoos, father one an illegitimate child at age 15, is recieving 900 dollars a month from SSI for his "anger problems". When I heard that I probably could have qualified, myself. Second example, my cousin married a foreigner, brought her mom over. mom become a citizen, signs up for social security, she heads back to the Philippines drawing as much as my dad, who paid the max into the system since 1980.

So like many, many problems with the govt, it has to do with a) special protected classes excusing themselves from societal obligations ( see Mandarins), and b) a lack of distinction between those who controbute to society and those who cling like lampreys to societies throat.

In my opinion, any time you pay or otherwise compensate people who arent earning it through work, you will fail. Do any of you think that the workers of the future are going to pay 50% tax rates so you can draw your retirement of $75,000 a year for the last 25 years of your life?? When I retire the country is going to be 25% hispanic and half of those will be foreign born. they will not want to subsidize the white mans lifestyle by picking his food, cleaning his house, then handing over half their earnings to pay his retirement.

Thank you Cheerio, I was not sure you were talking about the public pension system or 401k/IRA/Roth IRA savings system. thank you for your insight.

I generally agree with most of your points.

What I was pointing out, is that historically - a large unbalance tends to indicate problems. There will in fact always be inequality. But the ratio of inequality can be a telltale sign of some larger issue.

In this case, the issue is govt interventionism and corruption. I say that it is in fact govt that is the ultimate source of this, and that more govt will end up making the problem worse not better.

In a free market, wealth does not accumulate in the hands of so few people via market forces. Without govt at the highest levels aiding and abetting the elites and favoring them, wealth would be more distributed via natural market forces.

What you said, and this

http://www.huffingtonpost.com/mobileweb/..._n_1069424.html

To my blue collar mind, the idea that people can make a living, much less get rich, by moving piles of money around and creating NO real wealth is abhorrent.

Crony capitalism is as bad as socialism. It even has its own -ism: fasc-ism. it, and the welfare state, must be destroyed

I tend to agree with you Cheerio (although I don't know how much blame I'm willing to place on EVERYONE on Wall Street, businesses do need investors) except for the fascism=crony capitalism part. Any socialist state where the government controls the businesses,through back channels, could be described as cronyism because even in socialist states the corporations are often still "owned" by the powerful/elite players who are getting favors from those serving in an official capacity.

Fascism is simply socialism with some "ra ra state, we're better than everyone" thrown in, thus the NAZI party, national socialist party. And let's be realistic, what socialist nation doesn't say that it is better than all other nations? I don't know exactly how the fascists got linked to the political right, but all the evidence points to the other side. Eugenics - Left, Socialism - Left, State run media - Left, Giant government with nearly/or complete control - Left...

Communism - a system of social organization in which all economic and social activity is controlled by a totalitarian state dominated by a single and self-perpetuating political party.

Fascism - a governmental system led by a dictator having complete power, forcibly suppressing opposition and criticism, regimenting all industry, commerce, etc., and emphasizing an aggressive nationalism and often racism.

The difference here (which is deplorable) is that the dictionary attempts to make communism sound soft and cuddly by leaving out the dictator bit and calling it a "system of social organization"...

Any student of history can tell you that soviet Russia, North Korea, China, etc all operate just like the definition of fascism.

And since I brought it up, everyone wants us to believe that China is all soft and cuddly now because they are moving from communism to "state capitalism." What in the holy flying hell is the difference?

Cheerio, not that I completely disagree with you on "moving money around" point... but do you know what fiat money system is?

It means that money value is what we agree it is, without any kind of backing. It can be created, valued or destroyed in a pretty much any manner or way you can imagine. Policy controlled via lobbying and "investment" banking controlled via capital are probably two major way that do influence. In effect you have "money" creating rules on how "money" works.

Ohhh yes. "moving money around" to make money, without creating real wealth, can really only be done with fiat money.

I think its truedestructiveness is apparent when you look at all types of runaway debt- mortgages, student loans, credit cards- and the "soft taxation" of inflation. Since we have decoupled from gold all these problems have skyrocketed.

As i tell my students, money is magic, it only works because we all believe in it.

from wikipedia:

Fascism advocates a state-controlled and regulated mixed economy; the principal economic goal of fascism is to achieve national autarky to secure national independence, through protectionist and interventionist economic policies.[21] It promotes regulated private enterprise and private property contingent whenever beneficial to the nation and state enterprise and state property whenever necessary to protect its interests

I remember reading Mussolinis biography and there was a lot of talk about economic control. He managed to get all the big business on his side, and describedfascism as the State and corporations working together, which makes sense. The giant corporations love regulation because it helps force their small competitors out of business.

The point I was making is that, in an economic sense, crony capitalism is the same as socialism. From the middle class viewpoint I have, they produce the same results: less competition, fewer choices, shabbier products.

We're on the same page then. I was just making sure :D

I think what sinij was referring to was the fact that in its proper form, venture capitalists/banks perform a vital service - they basically produce "opportunity". You have an idea/skill/successful biz/etc, the financial guys can give you an opportunity to create/utilize/expand/etc by loaning you capital to build/equip/hire/etc and be successful. In return, if it works, they get back more money that they loaned you.

However the way the system currently works, if you are ultra wealthy/connected you can form mini cartels with your peers and get the govt to directly or indirectly back/loan/give you cash in return for your political/financial patronage. This is not limited to political donations, but often even more complex schemes where for one SMALL example (out of many) the Fed (mentioned fiat currency) will print up cash to loan to say Goldman Sachs at 0% interest - and even pay a distribution fee to GS , that Goldman turns around and loans out for profit. Goldman might even securitize the loans, and sell them off. If it goes bad, Goldman just gets more free cash from the Fed and repeats the process until they can squeeze cash out of the transaction.

Goldman might also loan to various patrons of the system, who in turn do whatever with it. Since it was loaned to a shell/holding corp of various sorts not the patron directly, the patron typically just takes a portion in terms of fees/etc, and if the venture is unsuccessful then oh well. Often a patron will hand cash to a patron that hands cash to a patron , and somewhere along the line a buyer for whichever security/company/investment/etc will be sought after.. often giving the impression that it is a viable investment with committed funding if needed. Then the poor guy at the bottom of the pyramid finds out he was sold a turd, and no further funding is forthcoming.... unless of course they play ball with the cronies.

Since the Fed has no accountability they can throw money at already monied insiders, and can also include their friends and friends of politicians who might otherwise be for holding them accountable in the loop. Its a patronage system.

There is of course much much more detail and ways that the corruption occurs, but it really is a topic of research in of itself.

But I think this type of thing is basically the type of thing sinij was referring to, and if so he was 100% correct.