I’ve been trying to figure out what reasonably is going to happen with the economy going forward here in the United States (and elsewhere, to an extent). But in trying to consider and discuss it, I’ve come across a vein of cynicism/pessimism/fatalism similar to one I’ve seen in discussing Donald Trump.
The argument, as far as I can tell, goes something like this: America’s politicians are ruled by corporate and moneyed interests. They will prevent any effort to benefit individuals, families, and small businesses to the extent they need in the interests of pocketing that government money for themselves. But if the economy stays really bad, what will they do for money, one may ask? The response is often, well, then they’ll just cash out, go live out their luxurious lives on some heavily armed tropical island. They don’t need or care about anyone else.
Yes, I realize most people who think this way genuinely believe it will happen, will have to happen. But as with Trump, it seems to render any discussion or possibility of change meaningless and naive, and we all might as well shrug and sit back and watch the country fall apart. Well, that may be, but I can’t really shift into that mode of thinking without more convincing than most folks who think that way seem willing to give.
So, I’d like a realistic and serious discussion of what Dopers think will actually be done with the massive unemployment numbers and failing businesses in the next few months. Is there any kind of necessity that will force the hands of DC and their corporate masters? If not, how bad will they feel comfortable in letting things get? Obviously, there’s going to be some level of graft and gathering of personal money and power, but to what extent, versus the help actually needed? How far can and will ideologues be pushed before reality forces their hand (money would help immensely with this, which is why I was musing on the oligarchs)?
Democrat will get elected then spend eight years trying to fix everything while dragging the GOP like an anchor around their neck. You know, the usual.
Your idea of what an economy is bizarrely mistaken.
For the most part politicians are not ruled by corporate or moneyed interests. They are ruled by voter preferences. Also their power over the government is very limited especially since government is so divided. Depending on how long the lockdowns last, the recovery could be very quick. The biggest economic damage may come from the new wave of economic nationalism that is sure to emerge. If the lockdowns last a long time and no effective way to comabat the virus emerges, the economy will take a lot longer to recover.
Is this just reflexive anti-Bernie Sanders posturing? Because it’s not close to true.
I’m not a Sanders supporter but he’s correct in saying that the rich make our laws because both parties that are beholden to them. There’s no rational counterstatement to this. The tax laws benefit the rich and large corporate interests. Corporate welfare is a very real thing and sucks up far more money than what people consider “welfare” for the poorer individuals. So do the laughable farm subsidies. Thousands of laws have been passed to benefit specific industries, sometimes even specific companies, and tucked away in larger bills where they don’t get much notice. The regulatory agencies almost always get co-opted by the industries they are supposed to oversee but instead overlook. That’s how the 2008 debacle occurred. People on the left have been screaming about this for decades and it ain’t because they are socialist commies. The system really works this way and voter preference has next to nothing to do with reality.
The $2 trillion disaster relief package - not a stimulus in any normal sense - does make a good start toward getting money into peoples’ hands. Yes, there’s the corporate $500 billion, but that’s not a terrible idea or just going to line pockets. Entire industries are in the process of collapsing. It won’t help ordinary people to get to the end of the quarantine and find no jobs available because the businesses are gone. The problem is that the federal government has no good infrastructure to get billions of dollars out the door to specific individuals overnight, and this kind of infrastructure is not the kind they’re talking about now. Not to mention that the policy of the Republican party is to never provide this kind of help, no matter how much it’s needed. They were dragged kicking and screaming to let some of this stuff in.
Will there be more? Almost certainly. I can’t comprehend why anybody is talking about finally doing the long-overdue infrastructure program right now when nobody can start it for many months. What is far more likely is that another disaster relief bill will get squeezed out of the Senate by Democratic pressure to keep providing relief because recovery will take far longer than the president wants to believe.
The 1% is not going to take off for some secluded tax havens. Their businesses are in it with the rest of us, and besides, a global recession is starting. They’re not truly threatened, to be sure: they can lose 25% of everything and still be stinking rich. I’m not going to worry about them the way I worry about small family businesses. But a true disaster is the one time that voters make themselves heard. They will get help. It may be too little or too late but with everybody screaming at once the government really has no choice but to act. The 1% is not going to stop it; they’ll just take their chunk and pass it off as sharing the pain.
Yeah, this is along the lines of what I was hoping/thinking. Everyone keeps saying these are unprecedented times; that applies to this aspect as well. Republicans are often good at standing on principle, but if things really get as bad as they could, I’m having a hard time seeing how doing nothing, or any functional equivalent, is feasible. The only way I can see is if they get absolutely no pressure from their corporate donors; thus my OP.
I read your post as being voiced by John Cleese which seems just about the right level of seriousness to interpret them.
As to the o.p., the “1%” definitely need “us”, or at least the segment of “us” that does all of the actual building, driving, shipping, receiving, medicining, engineering, lawyering, food preparing, elder caring, et cetera. They may assume that they don’t because they control the vast amount of mostly artificial money in the economy, but without actual goods being produced and moved and services being rendered, the rest of that economy (based on real estate speculation, trade exchange valuations, credit default swaps, et cetera, they are essentially playing a game of fantasy football. Do they realize it? Well, enough that they are willing to pander to providing barely adequate financial stimulus, but not enough to make fundamental changes to the economy or social and health care systems such that even working people are often put into financially perilous situations just to cover medical expenses or education.
Until the robots can actually do real work on their own, a labor market is still a necessity. And even then, robots aren’t going to take out student loans or run to payday cash-checking operations, nor buy luxury goods or provide a tax base or otherwise do anything that actually props the economy up. But as the 2007-08 financial crisis demonstrated many people are perfectly content to put the temple down upon their heads as long as they are living fat today.
If tax laws benefit the rich, why do the rich pay by far the most in taxes? After benefits are accounted for the bottom 50% of income earners pay less in taxes then they receive. The top 1% has 19.7% of total income and pays 37% of total federal income tax. The 1% pays an averageof 33.7% of their incomes in tax while the poorest pay an average of 1.7% in federal tax.
Meanwhile the US spends over 1 trillion dollars on helping poor people. Medicaid, EITC, TANF, unemployment benefits, section 8 housing, title 1 education spending, etc. Meanwhile corporate welfare is about 100 billion a year, or 1/10 the spending on actual welfare.
The kernel of truth in what you said is that money and lobbying can influence small parts of government tax and spending policy. Farm subsidies are a great example, but are a tiny portion of government spending. Likewise regulatory capture is very real and many industries are able to use government to stifle their competition but the reason is not money it is because they care more than everyone else, and are able to operate in the public’s apathy.
The rich benefit because they get far more than their numeric (or even tax dollar) representation. Law enforcement spends a lot more effort protecting the interests of the rich than the poor. Rich offenders are treated much, much better than poor offenders. The military goes to war to protect the interests of the rich, often at cost of buckets of poor blood.
Meanwhile, in this time of need, who are the most essential workers for our society? By and large, poor and working class people – delivery drivers, nurses, food service workers, grocery workers, health care workers, etc. The vast majority of these folks are not rich.
Any time the rich stay rich while poor people are suffering, rich people should feel overwhelming gratitude that the struggling masses haven’t murdered them to take their stuff. And they should feel continual fear that this might happen, because it might. History proves that struggling and suffering people will only allow cake-eaters in luxury to live such lives for so long before they’ve had enough. This is why, as a relatively affluent person myself (though probably not rich, depending on the definition), I favor policies that are targeted at alleviating the suffering of the poor. I want them to have good health care, and I want to stop the stupid wars overseas, because I don’t want them to come kill me in their rage at watching their families suffer and die needlessly. I want them to have a living wage, so they don’t come kill me and take my stuff. I want them to be treated with dignity and respect by law enforcement, so they don’t direct their legitimate grievances at those like me who generally benefit from law enforcement. In short, I want to make sure the poor have a shot at a decent life, because history shows us that when the poor do not, and there are a lot of them, eventually they will take out their rage on the rest of society.
Also, I feel compassion… but others mileage may vary on this kind of concern.
The same thing will happen as what happened in 2008. The rich will wait until assets are highly undervalued, and then buy them all up and merge companies.
Everyone else will fight and struggle for fewer jobs with lower wages and fewer benefits.
After a decade or so wealth will be more concentrated and most people will not have regained ground that they lost. The rich will recover in 2-3 years, but most other people will still be behind a decade later. Just in time for the next economic collapse.
Then we do it again until the robots replace us. Then the rich try to totally bring down democracy and create a fascist state.
Law enforcement spends alot more on the poor than on the rich, because for the most part crime takes place in poor neighborhoods and poor people are the victims. Those who have a household income of $25K are twiceas likely to be the victim of a violent crime as someone from a household that makes over $100K.
I don’t know how you define the interests of the poor as opposed to the rich in terms of going to war, but a reasonable price for oil and gas makes a much bigger difference to the poor than it does to the rich. The military gets more recruitsfrom wealthy places than they do from poor places.
In the current crisis the most essential workers are the research scientists trying to come up with a vaccine, the doctors and nurses treating the sick, and the logistics specialists making sure the rest of society is supplied. These are all highly paid professions. When a cure or vaccine is found who is going to manufacture it and distribute it? Rich drug makers.
You seem to have a bizarre and frightening idea of what your countrymen are like. They are not ravenous beasts seeking to murder you and steal your goods unless you buy them off with free money. They are good honest, hard working people who want jobs so they give them their families a better lifestyle. For the most part they understand they are blessed to live in the most prosperous nation on earth at the most prosperous time in history.
What history actually shows is that stealing from the producers to make political points is a sure fire way to impoverisha nation, while poor people have the best lives in nations where peopleare the most free to innovate and create.
Absolutely they’re wonderful people. Saints, in fact. The fact that they’ve endured being treated like shit by the rich and powerful for so long without lashing out is proof of this. I want them to be rewarded for their efforts – they’re only human, and humans will only put up with being treated like dogshit for so long before they snap.
Absolutely they’re wonderful people. Saints, in fact. The fact that they’ve endured being treated like shit by the rich and powerful for so long without lashing out is proof of this. I want them to be rewarded for their efforts – they’re only human, and humans will only put up with being treated like dogshit for so long before they snap.
If there’s a possibility of one good thing coming out of this pandemic, it’s that watching a lot of managers and administrators hang out at home while a lot of essential employees risk the trip to their hourly minimum wage jobs will prompt a lot of them to band together to ask “If I’m so fucking essential, why am I so poorly paid?”
Tax laws since Ronald Reagan’s time have on average benefitted the rich.
We have steadily improved the treatment of capital gains;
We have steadily reduced the top marginal tax rates
We have steadily reduced the corporate tax
We have steadily reduce the estate tax
We started treating tips like wages (for waitresses)
But we don’t treat carried interest income like wages (for hedge fund managers)
And the result of all this is a large national debt that is to some extent funded by the tax savings of these same rich people.
We have to a large extent replace taxing the rich with borrowing from the rich.
How much do you think the preferential capital gains rate costs us?
How much do you think the qualified dividend treatment costs us?
How much do you think accelerated depreciation costs us?
The tax code is replete with special treatment of income that is favorable to people with a lot of money.
I guarantee you that waitresses would love to have their gratuities treated like gratuities (AKA gifts) and not compensation but when the IRS was making rules about how to treat those tips, they said “well that’s obviously income” (because it is), I don’t know how much outrage there would be if they decided to treat tips as gifts.
When the IRS was deciding how to treat hedge fund manager carried interest, these billionaires got together and got everyone from Paul Ryan to Chuck Schumer to publicly say that carried interest is not compensation and the IRS never came down on the hedge fund managers. They did this in the face of a significant amount of public pressure.
I doubt it. The level of brainwashing and propaganda against unionization, socialism, and class struggle is so extreme in this country that odds are we’re going (and voting) more fascist and will have less power. Remember, even on the “left,” Joe “nothing will fundamentally change” Biden beat Bernie by a wide margin.
Do you realize that Franklin Roosevelt campaigned on a platform of “nothing will fundamentally change”? That was the only way to get elected then and I don’t see how anything has fundamentally changed today.
The real question is not who becomes the Democratic president but whether the Senate flips so that Congress is also majority Democrat. If that happens you can expect multiple major bills to pass that the president will sign, even if that president is Biden.
Good point. Looked at the other way, if managers and admin are so indispensable as they claim, how do things keep humming along at the store when they’re not around to mind it?
Not that I would expect that level of objective introspection from most of that crowd.