This is just broken windows bullshit. What’s funny is when I have this conversation in real life with people and I tell them that money should instead go to the government, they immediately start talking about how they would support giving more money to the government if the government didn’t “waste” so much of the money, not realizing they seamlessly shifted to arguing the other side of the broken windows debate.
Money “stimulates the shit” out of the economy regardless, it’s not possible for money not to be spent and that spending not to stimulate (even if you keep the money in a vault forever, it just inflates the value of every dollar not taken out of circulation slightly, increasing everyone else’s buying power).
How the money is spent matters because it affects the ability of an economy to deliver general welfare. The gardener, not gardening for the rich man could be gardening for someone else who appreciates it more.
Like Vin Diesel’s Dominic Toretto, they live life one quarterly earning report at a time. The board cares about the stock price, and a CEO thinking long term is two quarters from “stepping down for personal reasons” unless he’s got a controlling interest in the company and a bunch of cronies on the board. You might think that’s stupid and short-sighted. To quote Red from OSP “so…yeah.”
The Freakonomics guys looked into this a decade ago:
TL,DR: at least at the congressional level, doubling your campaign spending can indeed get you an extra one percent of the popular vote, but that’s about it. Candidates who receive a lot of money tend to win elections, but one is not the cause of the other; instead, a candidate’s popularity is the thing that drives donations, and is also the thing that drives their electoral victory.
Everyone benefitting is not an inherent part of capitalism. Capitalism is an engine, it’s dumb, all it does is churn and move money. Where that money ultimately goes is a function of government and societal actions. We have to point the engine where we want it to go.
Without government controls and worker protections you go right back to the early times of the industrial age, with the rich happily fucking over workers left and right to make another buck.
In front of the Federal Trade Commission building in Washington, there’s a statue called “Man Controlling Trade”:
Lantz spent four years on the sculptures and unveiled his finished creations in May, 1942 to critical acclaim. Federal Trade Commission biographer Marc McClure wrote that “the horse, representing big business, with its dynamic energy suggests that it could easily go on a rampage and leave a path of destruction behind it, oblivious to its own actions. The muscular man stripped to the waist standing beside the horse and gripping its reins symbolizes the federal government, which through intelligence and restraint forces the horse to submit its power to a useful purpose.”
I realize you were responding to a specific point about winning an election, and I’m about to post something broader: how money influences who gets picked as the candidate, the elections, and quid pro quo after they win. So for elections it would appear it can to the degree of 1% up (and 1% down by cutting money) but no more than that. However, the below provides a fuller context re campaign financing.
[T]heir conclusion that money does not have an undue influence on elections should be dismissed.
The fact is that private funding in election campaigns has enormous influence.
An analysis that fails to consider the power possessed by funders to shape our political discourse is seriously incomplete. But Freakonomics totally neglects that power.
The article goes on to state money decides who gets picked to run. How donating money creates a quid pro qou for those who donate a lot of money, etc.
“Far greater”? No, not in terms of the general wealth disparity. The problem being that the US has the greatest wealth disparity among all first-world democracies. The rich are richer, and the poor are poorer, than in any comparable first-world democracy. Mexico is worse than the US, but not by much, and it’s getting better while the US is getting worse.
This chart of Gini indices is a bit out of date but it gives the general idea.
Nonetheless I believe that Freakonomics original conclusion– that campaign money can only go so far towards winning the election in the first place– stands. The role of money in our political process is indeed a broader question.
Most people don’t really understand finance because most finance consists of mathematical abstractions of ownership, debt, and risk.
I mean even reading the OP, I’m not sure they have an understanding of basic accounting. Most of his question is related to what the 1% buy, not how they increase wealth. What the rich buy only really matters when it drives up the cost or siphons off revenue from stuff regular people buy.
The only brilliant thing Zuckerberg did was structure Facebook/Meta in such a way that the board can’t fire him. He will always be in control of a majority of voting shares.
Damn right, if you want to stimulate the shit out of a local economy, use $80M to build homes for 400 families, instead of building one home for one family to use once in a while. Because, when you’re done paying the architects and builders and skilled workers the $80M, you now have 400 families in the local economy who continue to work and spend and do things instead of 1 family that probably spends three quarters of their time elsewhere.
So then to get this full circle to your OP/my post # 65 about the 1% having too much influence on the democratic process, which I’ll say means: Who are the candidates; the election; what the winner does in office. So we can forget elections for now…is choosing between two candidates chosen by the 1% who will effectuate the 1%'s policy agenda, degrading democracy? Assuming that’s true, it must be. It wouldn’t if the 1% consisted of 100’s of millions of people (less inequality), but when that number of people gets to be less than 1M, and lesser and lesser each year (more inequality), it’s not healthy. Issues most Americans are facing don’t get addressed/resolved because they don’t need to. You can be a candidate and to stay in office by only doing the bidding of the 1%.
That’s kind of my overall point…“Assuming it’s true” is doing a lot of work, but which that article does address and confirm (who the candidates are, and what they do in office is greatly influenced by money), but I suppose I wouldn’t say that settles it or anything.
Sure, that would stimulate the economy more. But the billionaire in question wasn’t going to do that; it wasn’t a question of whether he would build 400 houses or a giant mansion, it was a question of where he would build his giant mansion.
It’s not like he took the funds for his mansion from the “Build 400 Houses for the Poor” budget.
The question is who has the $80M. The billionaire has it now because we have an economy that has been influenced to encourage monies to get into the hands of billionaires instead of thousandaires. Breaking unions, refusing to raise minimum wage, preventing UHC, tax laws and other laws all contribute to determining who gets the benefits from our growing economy.
Today, $80M goes to a guy who needs it so little that he’ll blow it all on a vacation home or a yacht. Instead, those dollars could go to people who will spend it on something that has ongoing value for the economy.
I watched the video on that ugly-ass Evergreen “house” outside Branson. The video said the construction cost was about six million; the eighty million is what someone thinks they can convince someone else to pay for it.
And the video said it looks like it does because it’s meant, in part, as a corporate retreat, so the owner could write off much of the costs. Had he instead given six million to build low-income housing, he could probably have more of a deduction and done a good thing for others.
Cool, but none of what you said contradicts any of my posts at all.
You’re right, our economy could definitely benefit from being more equitable.
A billionaire blowing $80 million is not increasing inequality. By wasting his money on something frivolous that is unlikely to appreciate in value, the billionaire is if anything decreasing inequality by lowering his own net worth and, as I said, stimulating the economy.
If you’re upset about wealth inequality, you should be upset about the money that the billionaire invested in ways that give him a continual return, not on money he pissed away and spent.
Dear Mr. Dead Billionaire,
I’d like to thank you for using 0.2% of your wealth to build an ugly useless building in the middle of nowhere. Your sacrifice of, well…, nothing, really, is well noted by myself and dozens of others for having put some money into the pockets of workmen and purveyors of overpriced luxury building materials. Of course, all that will be torn down and thrown in a landfill by the next billionaire who wants to build their own personal testament to excess.
People make the same silly “stimulate the economy” argument when the Defense Department spends billions on an aircraft carrier. But money spent instead on a bridge, port or factory has a bigger multiplier effect than something that just sits there useless.
