Others have
shared this already, but this is noteworthy in that it's difficult to overstate its relevance to today's perceived vs real
economic situation. When a Mitt Romney (a "1 percenter”) chastises a
critic of corporate wealth by saying
"Do you know what corporations are? Corporations are people, my
friend," we need to remember that the 'corporation as person' construct is
an artifice created to limit risk while maximizing the upside for investors.
And, yes, I am invested in financial instruments that take advantage of that,
but as one of the shrinking middle class, I really have little or no say in how
those corporations operate. If every individual investor appeared at an annual
stockholders' meeting and voted their shares, they would still be powerless to
counter any proposal made by the board and supported by the large, and in many
cases corporate, investors who hold majorities. Watch the video. You may have to return to the blog page afterward:
Those who scream about creeping Socialism would do well to
reflect on the total wealth and income
gap figures of the past 30 years and note that the opposite of what they claim
is actually true. I call this Faux News Syndrome (FNS). The truly troubling
aspect of this is that the real direction of the nation's financial reality is
much more similar to (wait for it!) the post -Soviet oligarchy that is modern
Russia. Take away the "Government Regulation" that has become the new
curse word of the far right, and we're there - a free for all, "support
the rights of the rich and ‘fuck the poor’ (thanks, Mel Brooks)"
mentality, enforced as it is in Russia, by a refusal of government to act in
the best interests of all its people. I'm not talking about free cell phones (a
Bush era sop thrown to the poor and funded largely by taxing cell phone
carriers, not an Obama initiative at all -
another FNS misconception), I'm talking about the fact that taxation
should reflect a fair appraisal of the effort and ability of the earner, not
simply the dollar amount involved. Most corporate CEOs, left to their own
devices and their own labor , would be
hard pressed to generate the kind of obscene income figures reflected in modern
corporate salary structures. In point of fact, in most modern corporations, the
CEO could die in his office and as long as that fact remained undetected, no
one would care. Karl Marx was a utopian who had a great deal wrong, but he was
correct about one thing: there is a value attached to the labor
required to produce a product. By current standards, that fact is minimal in
concern for most corporations. We need look no further than Nike to see the
evidence.
With a production labor cost of $2.75, Materials $9.00 and supplier's
operating profit $1.75, and a $.50 shipping cost, Nike paid (in 1996 dollars, cost is higher now, ratio is
similar) $20 per pair for sneakers which they retailed for $70, after paying
other costs (Research and development a
measly $0.25, promotion and advertising $4.00, and around $12 for admin and
profit (a 60% increase in price to retailers). After the retailer adds another $18.50
for rent, personnel pay and “other??” he tacks on another 25% profit and soaks
a kid $70 for the shoes which have an actual cost of production (materials and
labor) of around $11.00.It is also true, and should be noted, that Nike spends
nearly twice as much on promotion and advertising as it does on production
workers' wages. In March 1996 for example, tennis star Andre Agassi was paid a
reputed $140 million to promote Nike shoes and clothing.
Air Jordans are even worse, since Nike pays $16 to produce a
pair, which they retail for $164 – a 90% profit. Of course, all this is cloaked
in the increasingly threadbare guise of “Trickle down” economic theory, which
in simplest terms is the idea that profits earned at the top are filtered down through a
theoretical pyramid of beneficiaries and everyone is a recipient of some of the
largesse of the system. When such huge quantities are taken off the top for
non-production or sales salaries, the trickle down theory is much more like “haves”
pissing on the “ have nots.”
The video which I
refer to doesn’t even suggest “leveling,” which is the charge many on the
lunatic right hurl at social liberals and the current administration. What it
does do, very vividly is show that the division of wealth in America is skewed
far from what it was as recently as 30 years ago. What troubles me personally
is one of the great mysteries of modern American politics, and that is, the
continued adoration of many poor Americans, many of whom profess a Christian
basis of action, of those in politics who serve only to further their position
as darlings of the corporate state. Much of this split and widening gap between
top and bottom began its rapid acceleration around 1976. That darling of
conservatives, Ronald Reagan, and his acolyte, George H.W. Bush, ran on
platforms of deregulation, claiming that “unnecessary government regulations”
were slowing the economy. In reality, regulations such as the EPA, which Reagan
hated even though Nixon created it, were forcing corporations to adhere to
standards which caused expenditure of some of that profit margin which nourished
non producers at the top.
Much of the Republican
choreographed “outrage” at the Affordable Care Act is very similar, in that
many who will be essentially unaffected are protesting loudly. Many of these,
like Senator Ted Cruz, have deep ties to the insurance industry and are
beneficiaries of its support, overt and less visible. Cruz cares about several
things, none of which is really the welfare of his constituency. 1: His wife is
a major executive with one of the world’s largest insurers 2: Insurance
companies are huge contributors to anyone who will act in a manner which
protects their (historically huge) profits 3: The Tea Party is a very vocal group who
would support Hitler if he opposed President Obama and they work (for Cruz) for
free as long as he is their bitch. The troubling reality is that there are also
protests from their relatively ignorant sycophants who will actually benefit
from the ACA, but who have been convinced that it and the President are the “great
Satan.” The far right counts on the
continued ignorance of the voting populace to support those politicians who purport
to be advocates for the middle class, while in reality, they care about little
but their own continued political welfare and the support of the corporate
donors who spend billions (yes billions) in campaign contributions to those who
advocate for their ever increasing stranglehold on the US economy.
For these frauds, the term “We the people” seems to have
been corrupted to mean been corrupted to
mean “We the wealthy, and their toadies.”
The video shows what 90% of Americans believe is, and what
should be the fair distribution of wealth. If the job of Congress is to
represent the goals of the majority, but the reality is that many really represent
pronounced favoritism for the top 1% , the model is
horribly askew. I have no easy answers
to this problem, but the continued ability for hyper privileged families to
endow their, in many cases useless, offspring with all the luxuries of the ultra
rich with none of the responsibilities
is one clue to the nature of problem. Imagine if George W. Bush had been forced
to get into Yale on his own with a 930 SAT score or had not been bailed out of
failed business enterprises by Saudis with ties to the Bin Ladens. (look it up!!!!)
The continued existence of “flat tax” movements is another.
This lunacy suggests that a family with $30,000 annual income is just as fairly
impacted as a family of $ 3,000000 by a flat 10% tax. After taxes the $30K
family has lost $3,000, which leaves them with $ 27K as an income for the year,
while the top ender has paid $300,000 in tax, but has $2.7 million left. Who is
more adversely impacted? It should be noted that there is an absence of lower income
support for flat tax initiatives. An adjunct to this is the constant refusal of
Republicans to raise taxes and the rabid support of persons who would be
relatively unaffected by marginal tax rates caused by extending current
brackets. Most Americans living today have no clue as to how low today’s tax
brackets are compared to the Eisenhower, Kennedy, Johnson eras. Today (2013)
the top bracket is 39.6% on incomes over $400,000 annually. Those who scream “foul”
have apparently forgotten that in the heart of the Reagan years – 1986 – the top
rate was 50% on incomes over $175,000, and had been there for the entire Reagan
administration! Even that seems small compared to the 70% of 1979!
Let’s recap. 1) The public is largely ignorant regarding how
historically low income taxes are today. 2) The public, or 90% of it, favors a radically
smoother income distribution that exists, and believes it is better today than
it actually is. 3) Tea Partiers and their ilk, are toadies for corporate
interests and in few cases represent the true interests of their constituents. 4)
Many Tea party initiatives are actually harmful and against the best interests
of their support base. 5) Without continued government regulation, this
situation will worsen rather than improve. And finally; 5) Waiting for most
corporations to “do the right thing” on their own is akin to the definition of
insanity –that is “Insanity is doing the exact same thing over and over again
and expecting different results.”
And I do believe that’s all I have to say about that!
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