Sapphire Sky

July 21, 2012

Political Logic of the Nanny State, Illustrated

Filed under: books, culture, politics, economy, etc., video — Christ Ranger @ 1:47 pm

12 Comments »

  1. Historically challenged, at best. The notion that SS did not move millions of seniors out of poverty is simply laughable. He says SS security’s “unfunded liability” amounts to all the money in the world only works if “unfunded liability” refers to the governments commitment to continue SS for generations of Americans. All SS payments are “unfunded liability” because current recipients are paid from current revenues. Right now, if SS payments were made on all income instead of just the first 106,000 dollars, the system would be financially stable forever.

    I’d like to ask Mr. Biller a question: Germany, a socialist state by any measure, provides cradle to grave health care, requires a 2-4 week paid vacation for all workers, unemployment at 80% of previous salary, and generous payments for seniors. They have six percent unemployment, virtually no debt, a balanced federal budget, and BMW workers make more than GM workers. How, exactly, do you explain the success of Germany, given your views on the American welfare state? BTW, Germany also has a better infrastructure, harsher environmental laws, much more stringent banking and business regulation, and Strudel.

    Comment by James Corbett — July 21, 2012 @ 2:23 pm

  2. How does Germany do it?

    Comment by corribean — July 21, 2012 @ 2:24 pm

  3. Great questions. Being half German, I really like Germany. In addition to strudel, you just can’t do better than German beer, particularly Bavarian beer IMO. However, Germany is not the panacea you imply. To the contrary, they’ve averaged below 2.5% economic growth over the past twenty years (see http://knoema.com/gdp-by-country?gclid=CLaq47nKq7ECFcqe7Qodq3wAXA#Germany) and a continual unemployment rate between 5% and 12% over the same period. Our current unemployment “tragedy” has been the normal rate of unemployment the past twenty years in Western Europe. And no German national debt? Simply untrue. Their debt is about 85% GDP. See http://nationaldebtclocks.com/germany.htm. Further, the “German” population demographic doesn’t look good with birth rates plummeting to below replacement rates for many years now. I want stronger economic growth than what we see in Germany, which I’ll concede is the most efficient European socialist system, but that IMO is saying it’s the least sick economy.

    Nonetheless, I would pose the question differently, why isn’t Germany the economic basket case like nearly all the other European socialist states, like Greece, Italy, Portugal, Spain and increasingly France and Ireland? Part of the answer lies in the productivity of German workers, the superiority of their engineering, and their comparative refusal to allow immigrants to become German citizens or fully participate in the benefits of the German social welfare programs. I just returned from spending a few weeks in Germany and France. My travels reminded me of what I observed in the past, Germany is highly monolithic in its socioeconomic demographic – a nation largely of professionals and upper middle class tradesmen. Traveling through France, it wasn’t like that at all. Much more racial, social, and economic diversity was immediately apparent. Demographically, we’re much more like France than Germany.

    Comment by Anthony Biller — July 21, 2012 @ 4:28 pm

  4. A “nation largely of professionals and upper middle class tradesmen”? You do remain hilarious.

    1. You cite slow economic growth for Germany. Right now it’s faster than ours, but more importantly, what good does fast economic growth do if the wealth generated is increasingly concentrated in fewer and fewer hands. As TR noted, Democracy and great disparities of wealth cannot exist together because the people will simply vote to change the political/economic system in hopes of a better deal.

    2. Nope, Germany is NOT the most successful socialist economy. Take a look at the top ten most competitive nations. Finland, Norway, Denmark, Sweden, Netherlands, etc., all are as or more competitive than we are.

    3. Let’s get real, capitalism, as we know it, cannot be sustained where the population is shrinking. Would you invest in a business when you knew the customer base was falling? If the solution is constant population growth, what about the environment? Sustainability must be considered, or do you think a population can grow forever? The Earth is a big island, we can put up our excess in nearby planets.

    Completely free markets always dramatically favor those who have money will accumulate more. Have you bothered to review the horrors of the second half of the 19th century when capitalism was an unfettered as you seem to want? We almost ended up with Communism as capitalists exploited labor, destroyed the economy and accumulated so much money that Jay Gould could actually corner the Gold market.

    One principal: If a government adopts policies that result in the size of the middle class shrinking, those policies should be reconsidered. People who argue to the contrary are radicals in the sense that such policies create the conditions for political/social revolution. Creating the conditions for revolution can hardly be considered conservative. For example, assuming you don’t like Obama, it was “Ws” policies that created the conditions that elected Obama. How did that work out for conservatives?

    Comment by corribean — July 21, 2012 @ 5:28 pm

  5. hit enter by mistake before I edited, but you get the ideas.

    Comment by corribean — July 21, 2012 @ 5:29 pm

  6. Now that I think about it, your screed did fail to even address the role of the taxpayer supported military in providing free security for the corporate investments overseas, not to mention other forms of “corporate welfare.”

    Free market capitalists should limit their evaluation of markets to risk/reward and the political stability of the nation where they invest should be part of that evaluation, but it is not.

    Corporations know that they have enough power in Washington to get lawmakers to send in the Marines anytime American “interests” (capitalist investments) are threatened. In short, the sons and daughters of workers regularly lay down their lives to protect a class that rarely bothers to fight itself.

    Far more than half the military budget is corporate welfare. Walmart pays for it’s own security guards, why can’t corporate American assume ALL the costs that produce their profits? It’s simple, they have to and don’t want to. Such a decision might require a cutback on vacation homes.

    Comment by corribean — July 21, 2012 @ 6:12 pm

  7. Hah! Where to start on a Saturday night in response to such Marxist pabulum? Should we review the history of planned economies of the 20th Century? In reviewing the “performance’ of European socialism, you really ought to look at the last several decades and not compare them versus the fourth year of the Obama presidency (or really the 12th year of Neocon/Eurosocialist imperial presidencies).

    The horrors of the late 19th century pail in comparison to the totalitarian horrors of the 20th Century, brought courtesy of the central planners of whom you seem so fond. You miss the obvious, you can have strong anti-trust laws without a cradle to grave nanny state. Further, in current advanced market economies, labor abuses are more quickly remedied through consumer information campaigns, typically boycotts, than through regulatory regimes that typically end up protecting established interests more than the public trust. In today’s economies and information society, your recitation of Dickens woes is no longer a credible basis for justifying socialism. Give free markets and individual economic liberty a chance.

    As a final response note, one of my pet peeves of socialist dogma is the feigned concern of “workers” forced to serve in the military for the interests of the bourgeoisie. Two problems with that, nearly always, the liberal making the argument has never spent a day in uniform. You hardcore left wingers are big on talk about caring and knowing about our service people, but short on serving or having any real world experience in the military. Second, you’ll find a disproportionately large percentage of veterans are conservative entirely because of their time in service. I know because I’m one. I was a bit of socialist wag, which you sound to be, until I entered the US Army and lived for years in a hardcore socialist environment. We owned nothing. The government owned all the property and all operations were centrally planned. The healthcare was universal and we considered it universally bad. There was little concern nor respect for the gov’s property, which I learned first-hand as a property accountability officer in one of our countries elite rapid deployment forces. The system is incredibly inefficient. My military experience was a proximate cause of the unraveling of my university ingrained left-wing beliefs, that and traveling to the Eastern bloc and visiting the third world … In any event, your class-warfare in the ranks line rings quite hollow to this veteran.

    Comment by Anthony Biller — July 21, 2012 @ 10:04 pm

  8. Six observations: First, you didn’t respond at all the fact that capitalism demands the impossible–infinitely growing populations. Second, you didn’t respond to my assertion that corporate welfare far surpasses public monies spent on the “nanny state.” Third, you didn’t respond to the issue of concentration of wealth. Fourth, you didn’t respond to my assertion that people who create the conditions for a labor revolution are not conservative, but radicals who foster political/economic revolution. Fifth, you didn’t respond to my assertion that the military budget is, in many respects, more corporate welfare. Six, you didn’t respond to my assertion that economic policies that have the result decreasing the size of the middle class and concentrating the wealth are not politically sustainable.

    “…labor auses are more quickly remedied through consumer information campaigns, typically boycotts, than through regulatory regimes…your recitation of Dickens’ woes no longer credible basis for justifying socialism.”

    When corporations have larger GDPs than most nations and move capital easily from nation to nation, there is no remedy for labor abuse. Start an information campaign or boycott and either they use their power to outlaw that activity or they move their capital to another country often after soliciting environmental, health, wage and working condition advantages.

    “Give free markets and individual economic liberty a chance.”

    The result, always, because of the nature of competition in which non-labor resources generally tend to be similar for those in similar industries existing in the same State, is a race to the bottom for wages quite simply because labor can be squeezed but the cost of machinery, raw materials et. al., cannot. You’re right, that’s the “Iron Law of Wages” (Ricardo). He was right then and right now.

    I’ve been in three wars on four continents, so don’t bother to give me that crap. If you swallowed the corporate Kool-aide in the community of obedience that is the military, fine, but I’ll pass.

    General Smedley Butler won the Congressional Medal of Honor TWICE. Here’s his take:

    I spent 33 years and four months in active military service and during that period I spent most of my time as a high class muscle man for Big Business, for Wall Street and the bankers. In short, I was a racketeer, a gangster for capitalism. I helped make Mexico and especially Tampico safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of half a dozen Central American republics for the benefit of Wall Street. I helped purify Nicaragua for the International Banking House of Brown Brothers in 1902-1912. I brought light to the Dominican Republic for the American sugar interests in 1916. I helped make Honduras right for the American fruit companies in 1903. In China in 1927 I helped see to it that Standard Oil went on its way unmolested. Looking back on it, I might have given Al Capone a few hints. The best he could do was to operate his racket in three districts. I operated on three continents.

    For all that, market solutions are ALWAYS the best first choice

    Comment by james corbett — July 22, 2012 @ 12:05 am

    • So what? You didn’t respond to the issues of the significantly different demographics between Germany and USA, the failing economies of most of the largest European socialist economies, the utter failure of planned economies over the past 100 years or the horrors they visited upon humanity, the comparative economic growth of ostensibly market economies over the past fifty years compared to socialist economies, the collapsing birthrates in European socialist countries over the past decades, or the hypocrisy of most lefties claiming concern and or knowledge about our military. I suppose if you had answered those, I might have felt more obligated to address each of your issues.

      As someone who owns a small “corporation”, I’ve long found the left’s vilification of “corporations” absurd. Not quite as often as the military wag, but often enough, those throwing around the corporate accusations have never owned or operated a business, have never employed anyone else, and haven’t created anything for the betterment of humanity, there are some exceptions, but not many.

      Corporations do flee over-taxation and over regulation, true, however, for the vast majority of businesses, it’s not a race to the Lord of the Flies. There are some rare exceptions, though a high price is paid when consumers find out. Contrary to what your Leninist friends claim, most business owners are sentient, moral beings who try to do right before God and their fellow man. There is certainly greed and corruption in corporate America, but that is a condition found throughout humanity and evil diffused throughout a free society is far less harmful than the same evil in the hands of centralized power. Evil and self-serving men gravitate to where power resides and increasingly in the West, that means in the institutions of the nanny state. Another form of evil has no qualms taking what is not his even though through his own effort he could have provided for himself. Wake up.

      When labor is skilled and when it’s mobile, which today it largely is across much of the world and across the entire West, there’s a labor side race to the top for wages (been hiring in STEM areas lately? Do you employ anyone?). What you say may be true for unskilled, immobile labor, but even there, the mean wages of unskilled labor as well of standards of living have progressed most steadily over the past century in market economies, an undeniable truth. Private innovation, private ownership of property, and direct returns for your economic activity has proven over and over again the create the most wealth and better standard of living for all of society for the past 100 years.

      The fact you have to reach back to the 1930s for a veteran (who conspired to overthrown the US government) that supports your Marxist bias I think does more to prove my earlier appoint than refute it. Speaking of which, three wars on four continents? I’m skeptical. “Wars”? Asia, Europe, Central America and …? I don’t believe any country has fought “wars” on three continents since WWII. So you’re either in your 80s or you’re significantly exaggerating. Are you a Vietnam vet? Are you Harry Targ?

      Comment by Anthony Biller — July 22, 2012 @ 8:29 am

      • After seeing your original, rather clever post, my response was simply designed to insure that unsophisticated viewers were not seduced an ideologue. Communists, Libertarians, religious fundamentalists and other Utopians all have one thing in common, they believe their ideology will produce social and political perfection IF ONLY IT WAS GIVEN A FAIR CHANCE. When anyone points out that a given ideology has been tried and failed, the ideologue responds THAT WASN’T REAL (name the ideology), IT’S NEVER BEEN TRIED. (Does that sound familiar readers?)
        .
        Four other comments:

        1. “Mean wages of unskilled labor as well as standards of living have progressed most steadily over the past century in market economics, an undeniable truth.” Yep, but then going back 100 years is misleading because my posts relate to the pernicious effect of unbridled multi-national corporations. It started slowly, but I think Eisenhower’s farewell address was fairly predictive about the power of corporate wealth. In truth, and you must know it, the law of supply and demand determines the price of labor in a free market, and with billions living below the $1.25 a DAY that is the poverty level, most American workers can’t compete.

        2. As for my experience: I was in Belfast in the sixties and seventies. El Salvador in the late 70s early 80s. I was in Nicaragua in the 80s. I was also in Lebanon in the 80s (yes, I was there when the Marine barracks was attacked). I was in Bandar Abbas (Iran) during the Iran/Iraq war. Yes, I’m too old to have kept it up past the 80s.

        3. Butler tried to overthrow the government? Actually he turned down a group of Wall Street brokerage firms who approached him with the hope he would be the figurehead of a new government. He turned them in and they fought back with a claim Butler was the genesis of the idea. Here’s the Wiki take: The Business Plot (also known as the Plot Against FDR, the White House Putsch) was an alleged political conspiracy in 1933. Retired Marine Corps Major General Smedley Butler claimed that wealthy businessmen were plotting to create a fascist veterans’ organization and use it in a coup d’état to overthrow United States President Franklin D. Roosevelt, with Butler as leader of that organization. In 1934, Butler testified to the Special Committee on Un-American Activities Congressional committee (the “McCormack-Dickstein Committee”) on these claims.[1] In the opinion of the committee, these allegations were credible.[2] No one was prosecuted.
        While historians have questioned whether or not a coup was actually close to execution, most agree that some sort of “wild scheme” was contemplated and discussed.[3][4][2][5][6] Contemporaneous media dismissed the plot, with a New York Times editorial characterizing it as a “gigantic hoax”.[7] When the committee’s final report was released, the Times said the committee “purported to report that a two-month investigation had convinced it that General Butler’s story of a fascist march on Washington was alarmingly true” and “It also alleged that definite proof had been found that the much publicized Fascist march on Washington, which was to have been led by Major. Gen. Smedley D. Butler, retired, according to testimony at a hearing, was actually contemplated.”[8] AS MOYNIHAN SAID, YOU’RE ENTITLED TO YOUR OWN OPINION, BUT NOT YOUR OWN FACTS.

        4. “Not quite as often as the military wag, but often enough, those throwing around the corporate accusations have never owned or operated a business, have never employed anyone else, and haven’t created anything for the betterment of humanity, there are some exceptions, but not many.” I have nothing against corporations, but remember they have one purpose-profits for stockholders (that’s a good thing). We can’t expect them to worry about anything else (they shouldn’t), not the environment, not workers (unless such worry leads to more profits), not political stability (unless it threatens profits), and certainly not the welfare of workers.

        I’m done with you, as with most ideologues

        Comment by corribean — July 22, 2012 @ 11:02 am

  9. So … if you reject European socialism in favor of market driven economies and limited government, your a utopian ideologue. Lovely and on par with much of the rest of the sentiment you expressed.

    Re no. 4, unless of course their shareholders care about such things, which of course they do since “they” are “us.” We disagree both about the nature of Eisenhower’s warning – it was against the military-industrial complex not multinational corporations – and whether American labor can compete. Your hallowed German worker costs more than the average American worker, but high quality and skills trumps unskilled labor most often. High corporate tax rates and regulation incentivize people to move their production overseas, particularly when the fastest growing markets for the goods being produced are overseas …

    Comment by Anthony Biller — July 22, 2012 @ 10:06 pm

    • Well, you suckered me into one more response==Actually, it’s illegal for management to knowingly take any action which violates their fiduciary responsibility to make profits for shareholder see Ford MC v Stockholders. There is also a rather large gap between what our tax system says corporations pay and what they actually pay. http://jonathanturley.org/2012/07/22/corporate-liars-and-the-lies-they-tell/ What business needs is stability for the purpose of long term planning. Of course Eisenhower was speaking of the M/I complex, but multinational corporations had yet to dominate the world. His point however, about the accumulation of power and political influence now apply to the multies. At least when the M/I was primarily an American phenomenon, it was possible to legislate against their excesses. Today, they are above all national laws and, effectively, can do whatever they wish, and do. Would you prefer to have Ireland’s rate? How did that work out for ya? BTW, the Irish are the best educated people in Europe, have the highest level of technical skills, and limit regulation.

      W-“As you know, excessive regulation and red tape have imposed an enormous burden on our economy — a hidden tax on the average American household in the form of higher prices for goods and services. Just as Americans have the right to expect their government to spend tax dollars wisely, they have the right to expect cost-effective and minimally burdensome regulation. Although the Congress has thus far failed to pass most of the Administration’s regulatory reform proposals, there is much the Administration can and should do on its own to reduce the burden of regulation.”

      W-From The 2009 Budget Deficit: How did we get here? by John Irons, Kathryn Edwards, and Anna Turner:

      This Issue Brief examines the details and causes of the current budget deficit and the role the current recession has played. The years between 2001 and 2007 saw a large deterioration in the budget balance, which was driven chiefly by legislated policy changes. The Bush-era tax cuts are the largest contributors to this period of policy-induced increases to the federal budget deficit. . . .

      yep, dereg and lowered taxes worked!! Just like it did for Reagan.

      Comment by corribean — July 22, 2012 @ 11:18 pm


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