World, Writing, Wealth discussion
Wealth & Economics
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What to do?
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I think if we treated the wrongs of others as if they were our own that would be a good start. Honestly I also think it's how amd what we teach our children that really sticks.
My answer is, well, write books, dealing with the problems I see coming. As an example, you may recall the Dallas shooter was neutralised with a robot-controlled bomb. The book I am writing now, called 'Bot Wars, has the theme of what happens when these sort of machines are hijacked, and how difficult they are then to deal with if you haven't prepared. You may not think this is a pressing problem, and perhaps it is not now, but my view is that now is the time to make sure these sort of disasters can't happen in the future.In principle, people might read these books and avoid the problems. In practice, the number reading them won't make much difference.
Ian wrote: "My answer is, well, write books, dealing with the problems I see coming.In practice, the number reading them won't make much difference..."
Yep, that's certainly an inspiration, but as you mention, the realistically- expected impact wouldn't be grandiose
Revolutions are problematic, as they are usually led by extreme-oriented individuals apt to use violence. Peaceful laymen won't be game to lead, but they are likely to follow. Notably, many revolutions furthered a noble agenda. But can the same people that win sometimes a bloody battle build a just society? I doubt it. The history proved otherwise. French revolution was followed by the reign of terror, where many died, incl revolution's leaders and eventually brought to usurpation of power by Napoleon.Russian revolution - what can be possibly more noble? Workers and peasants snatched the power from money bags and nobility. But then there were decades of terror where dozens of millions died in 'cleansing'. There is a chart somewhere demostrating this, but in a nut shell Stalin executed almost all of his peers, who were originally leading the revolution.
Besides, it seems to me capitalism is somewhat closer to human nature of individualism than a society based on strictly communal values. There are not enough Mercedeces, but there are lots of people wanting to drive them. How do you solve it? If it wasn't money, then the strongest would've driven them. Or making a queue -:) Both values are important, so I'd rather think of improving the current system than replacing it entirely, especially though revolutionary means. I personally think that race for accumulation of wealth is constructive along most of its way, but becomes very destructive at the very top, where it turns into a self-preservation mode.
Removing oppressive regimes though might be a different story, because there you put force against force.
Re debt - yeah, it's a huge problem. But I remember reading that French asked US to change the pieces of paper, where 'dollar' was written to gold, as they were supposed to be backed by gold reserves. And US refused.... There was a shock, for sure, but they found a solution eventually -:)
I have written a series of futuristic novels in which various types of political/economic systems are tried (and oddly enough, I seem to have overlooked communism) and the common feature is that they all have series defects (to get the plot going) and these are invariably due to some manipulating the system for their own ends off alternatively, the system goes off course trying to defend itself. OK, I needed that for the stories, but I also think it is true. My personal view is that the ideals of Star Trek mentioned above are to some extent at least consistent with the ideals Lenin had for Communism (Read "The State and Revolution"). What actually happened was that when the revolution got going, not everybody had Lenin's view, so the Communists had to start overcoming opposition and purging, and of course once started, Lenin found it hard to stop. Then he died, and Stalin had no trouble regarding stopping purges - he simply had no interest in stopping them. Stalin had this perverse view, "Better to get 10 innocents than miss one guilty."
Part of the reason I believe debt is such a problem is that governments think debt is great because (a) they can please the population and win elections now, and (b) the economy will keep expanding, so it will be easier to pay it back. The problem comes when the economy ceases to expand but recesses. That was overcome in 2008 by increasing debt, but the problem now is, by making interest rates so low, debt is getting out of hand, AND by and large, the debt is not going into productive or virtuous ends. The next recession will really bite, so what do governments do? Probably cancel debts and let everyone take "hair cuts". So, what happens then? Who lends to governments?
But wait a sec-:). What about all those credit ratings that are supposed to reflect something about countries creditworthiness?The US is a triple A, even Spain is somewhere between BBB+ to A. Moody's, Fitch, S&P and others regularly rate sovereign borrowers.
Or does Poor in 'Standard & Poor' stand for something else?
Ian wrote: "My personal view is that the ideals of Star Trek mentioned above are to some extent at least consistent with the ideals Lenin had for Communism (Read "The State and Revolution"). What actually happened was that when the revolution got going, not everybody had Lenin's view, so the Communists had to start overcoming opposition and purging, and of course once started, Lenin found it hard to stop. Then he died, and Stalin had no trouble regarding stopping purges - he simply had no interest in stopping them. Stalin had this perverse view, "Better to get 10 innocents than miss one guilty."..."Communism, that was never actually implemented, but was supposed to evolve from socialism in socialist countries, envisaged total abolition of money.
I'm not sure, how much the purges can be attributed to Lenin, who was wounded shortly after the 1917 revolution, never fully recovered and died in 1924 and had to deal with the WW1 and ensuing Civil war. Don't think he executed any of the colleagues, although he doesn't strike as a tender dude.
But it was in his time, of course, that Dzerzhinsky started to organize - Che Ka (which evolved into KGB eventually) aimed to prevent counter-revolution...
Anyhow, in the history I studied (and it's being revised practically every morning -:)) the repressions are called 'Stalin Repressions'.
Debt is the reason governments love inflation. They can borrow a sum of money and pay it back when it loses half its value and the government has to print more money. Inflation is a better friend to debt than low/zero interest rates.
J.J. wrote: "Debt is the reason governments love inflation. They can borrow a sum of money and pay it back when it loses half its value and the government has to print more money. Inflation is a better friend t..."In my opinion, the hidden problem with very low/zero interest is that too many get into huge debt, and took few are saving and investing, so you end up with the sort of economy where everyone is working for the banks. Now, how do you get out of this mess? If you raised interest rates, the heavily debated simply fall over and there are so many of them there is a good chance of a major recession, but if you don't, the situation just gets worse, and eventually the only way out is to either inflate the currency so the debts go away, or simply enforce major "haircuts".
Ian wrote: "J.J. wrote: "In my opinion, the hidden problem with very low/zero interest is that too many get into huge debt, and took few are saving and investing..."There is a time bomb right there. It's different across the globe, but in some places loans are indexed to inflation and/or central bank's rate. The moment any of these two parameters considerably increase many businesses and households may have a serious problem to keep solvent....
Yes, Nik, in NZ, and particularly in Auckland, thanks to politicians with investments in property, house prices have got out of hand with the lower interest rates. And a lot of other people have borrowed against their house because the interest rates are low. It could be quite chaotic if interest rates rise, and sooner or later someone has to lend, and why will they?
Exactly same here.And most loans are indexed to inflation or central ban'k rate. Although banks here usually don't approve loans, which monthly return exceeds 1/3 of household's income, I'm pretty sure that a considerable increase in monthly return resulting from increase of central bank's rate, for example, will cause massive default. Scary to imagine the consequences
Ian wrote: "J.J. wrote: "Debt is the reason governments love inflation. They can borrow a sum of money and pay it back when it loses half its value and the government has to print more money. Inflation is a be..."Raising rates might be brutal for many, but it could be the only way to slow down the lending and stop the most vulnerable from getting themselves in further trouble. Problem is, the spending drives the economy. Businesses learned long ago they could get people to by more stuff if they extended that credit. Slow the lending, and you slow the economy.
J.J. wrote: "Raising rates might be brutal for many, but it could be the only way to slow down the lending and stop the most vulnerable from getting themselves in further trouble.. Slow the lending, and you slow the economy..."
It became a trap both ways. You both want to slow the lending and don't. Every way you go from here, somebody's getting scr.wed..
I think a good part of the problem comes from politicians. Keynes had this idea that in tough times the governments could create money and thus run serious deficits. The problem came with the second half of the prescription, which was when times got good again, this created money had to be withdrawn and debts paid off, at least to a reasonable level (i.e. debts for consumption had to be paid off - debts for infrastructure were OK because they paid themselves off). The politicians loved the first half, but the second half (damping down the good times) got really unpopular, and of course it was always "good" to get into debt and have good times, and let the successor politicians work out a way of getting out of the mess. The trouble now is, we are in a mess, and I doubt there is any room left to prime another recession.Maybe that isn't quite right, but it is the basis of a couple of my novels, so I shall stick with it :-)
Even on a high political level it often goes like on the every there - assuming that everything's gonna be alright. In line with human nature.I think there are positions that your modus operandi should be based on the pessimistic assumptions even if they are against the trends.
Currently, when it momentarily looks like the worst is behind, basing on this or that single macroeconomic indicator, the above assumption should still apply. Yeah, it's annoying and unpopular to think this way, but sometimes and for some positions - necessary.
In my case, given where we are now, I doubt we have too many options. Most countries have record low interest rates, which has led to an explosion of personal debt. There are only three ways out - everybody work it off (unlikely to happen because debtors don't cooperate); cancel debt, which hurts lenders; or shake it out, which effectively generates a depression. So no, I don't know, and I hope someone has a magical fourth option. Any suggestions?
No suggestions here, as I don't know enough about economics. Just an interjection about Star Trek, since it was part of the discussion. Fantasy, I know. But the reason that there was no poverty and that money was not a worry was that they had replicators that could provide food and drink -two staples of life, and sources of strife in our world.
Ian wrote: "Most countries have record low interest rates, which has led to an explosion of personal debt. ..."Yes, that's a global problem, however the specifics might be quite different. From what I hear from friends in the States and UK, for example, and I don't know how true it is, but they say, most mortgages (and that's usually the biggest personal debt) have fixed interest, so their return is predictable no matter what happens.
We, for example, have most mortgages with flexible rates, pegged either to central bank's rate or another rate or inflation. It's quite possible that when these parameters start to change, the monthly return 'jumps' significantly and families fold under the burden.....
So whatever situations, based on low rates and low inflation, they indeed contain a great risk factor, once and if the situ starts to change.
And Trump seemed to be determined to put an end to austerity, increase spending and thus re-ignite the biz and inevitably - inflation.. Yellen has already started to raise the rate in the States, something that hadn't happened for how long? Maybe 7-8 years.
Others might follow suit..
Here in NZ you can get fixed or floating rates, but the fixed ones are usually only for up to three years. If the rates are fixed until repayment, then I guess you are going to be lucky.
We hear here that some members are discontent with their and not their governments (claiming not their gov-s are still their govs:)) and maybe with systems as a whole, so it's only natural to ask what to do about it?
Nik wrote: "...From what I hear from friends in the States and UK, for example, and I don't know how true it is, but they say, most mortgages (and that's usually the biggest personal debt) have fixed interest, so their return is predictable no matter what happens...."Most of our first mortgages in the States are 30-year fixed rate, with no penalty for early payment. While there is a lot of complaint about the current interest rate on mortgages being high, it's not compared to the double digits we paid in the 80s. But, somewhere in the late 90s the mortgage rate fell to less than 10% and in early 2010s to below 5%. For many now trying to buy a home, the interest rates seem excessively high, but still below 10% (closer to 7%) and a fixed rate.
Those with a lot of credit card debt are worse off because the APR is so much higher. I have credit cards that ranged 8% to 21% when I got them 10 to 15 years ago but are all currently 60% higher.
Replying to Nik's post 24:What to do about the government, when the people in government are bought by corporations and special interests (sanctioned by the Supreme Court's decision that money equals free speech)? When we're not sure if elections are rigged by ballot collecting, lack of valid voter i.d., and maybe insecure electronic machines not backed up by paper ballots? I'd say there's not much we can do. At some point, people may get their fill of feeling unheard, helpless and hopeless and express their anger.
Scout wrote: "...At some point, people may get their fill of feeling unheard, helpless and hopeless and express their anger...."Yes, a possibility, as we've entered turbulent times.
Scout wrote: "Replying to Nik's post 24:What to do about the government, when the people in government are bought by corporations and special interests (sanctioned by the Supreme Court's decision that money equ..."
I don't think the elections are rigged (aside from redistricting or gerrymandering) but I do think special interest groups, lobbyists and large corporations influence our government more than the vote of the American people.
The pharmaceutical and health products industry spent the most on lobbying from 1998 to 2023, reaching a total of more than $5.8 billion. The pharmaceutical/health industry is also a top spender in political campaigns, with contributions reaching a total of $89.09 million in 2020. In 2023, Pfizer spent $14.36 million on lobbying.
Other industries that spend heavily on lobbying efforts include insurance (health, property and auto), electric utilities, electronics manufacturing (software and hardware, including Microsoft and Oracle), business associations (key issues being limiting civil awards and tax reform), oil and gas, and hospitals (nursing homes, hospice, mental health, inpatient addiction).
According to Open Secrets, in 2023, the groups that spent the most on lobbying were the U.S. Chamber of Commerce, the National Association of Realtors, American Hospital Association, and the Pharmaceutical Research & Manufacturers of America. Blue Cross/Blue Shield, Amazon, and Meta were the companies that spent the most on lobbying.
I recognize that not all lobbying is bad. How else does government determine what the general masses want? I just think there is a big different between AARP advocating what is wanted and is best for all Americans over 50 as opposed to those who are spending the most money to protect their own profits, such as insurance companies limiting their liability and businesses creating tax reform that betters them and reduces its support of the government through paying reasonable taxes, or for profit prisons benefitting by preventing criminal law reform.
It is very difficult to tell the different between lobbying and bribery these days. Best I can figure is bribery tries to buy and outcome and lobbying tries to influence an outcome. Throw enough money behind influence and I am not sure it doesn't become bribery. I don't have a solution, but I think most of us are concerned by lobbyists and ]campaign contributors at these levels.
Note - Redistricting varies according to state law with the only constitutional requirement being equal population. From an eduational article, "The redistricting that followed the 2010 census suddenly became less fair as partisan mapmakers used newly available information, technology and software to draw maps that greatly favor one party while respecting the equal population requirement."
Note 2. From Investopedia. "In 2022 alone, lobbyists spent $4.09 billion on influencing political policy, representing the highest sum spent on lobbying since lobbying spend peaked in 2010."
"Corporate political activity can take the form of campaign contributions, but companies and industries also employ lobbyists to make their views known to lawmakers and regulators. "
From Open Secrets. "Industry Profile: Insurance: Background. "More contributions from the insurance industry have gone to Republicans than Democrats in every election cycle since 1992."
Democracy gives decisive role to majority, but majority is represented by a much smaller circle of representatives (representative democracy). Lobbying is used to promote interests of narrow minority (a certain industry, one businessman, an association of businesses) through influencing representatives and thus overriding public interest/ rule of majority. Oftentimes lobbying is stronger than democracy.
The main problem with democracy is that politicians want to stay in power, and democracy has these things called elections. That needs money, so those who will donate large amounts of money get the support required to keep donations flowing. The second problem is the choice of politicians. In principle these are noble people seeking to serve the country. In reality they tend to be more interested in serving themselves, and worse they are becoming professional politicians. By that I mean many tend to want to be politicians most of their lives, rather than people who have achieved elsewhere and offer their experience to help their country.
While there is much to be said for experience, I think the American system would be better served by limitations on public service. How to accomplish that, I don't know.
I think you could accomplish that the same way you have for Presidents - they serve two terms (if re-elected) and that's it. Put a time limit on other positions and embed it in the Constitution as an amendment.
Ian wrote: "I think you could accomplish that the same way you have for Presidents - they serve two terms (if re-elected) and that's it. Put a time limit on other positions and embed it in the Constitution as ..."It's not just the federal government. Mayors within large cities and governors of States hold a lot of power when elected over and over. Additionally, lobbyists and corporations are not just working at the federal level. They know they are going to need favor from the county supervisor to the state governor to the federal representatives, all along the way. Plans within plans, and long-term, advance planning.
You contradict yourself, Lizzie. You say that not all lobbying is bad, yet you admit "It is very difficult to tell the different between lobbying and bribery these days" and that "I think most of us are concerned by lobbyists and campaign contributors at these levels." Why not just say that it's not okay for our government representatives to be influenced by money?
Scout wrote: "You contradict yourself, Lizzie. You say that not all lobbying is bad, yet you admit "It is very difficult to tell the different between lobbying and bribery these days" and that "I think most of u..."Scout, I said that because it's true. LIke many things, it becomes bad when it is abused. At a more basic level, how would your town know how you feel about your neighbors having chickens unless people express their interests. How much does AARP accomplish for over 50 crowd? When mega-corps and mega-rich buy the vote using their influence and money to control the government and politicians, it is bad. When it is used to make the government aware of what the people want (such as less expensive prescriptions under medicare), it is a good thing.
So bribing politcians with money is okay? Aren't they elected by the people to represent their interests, not the interests of corporations, special interest groups or the rich? Why even vote if money overrides your vote?
Scout wrote: "So bribing politcians with money is okay? Aren't they elected by the people to represent their interests, not the interests of corporations, special interest groups or the rich? Why even vote if mo..."I am not saying bibery is ok or that giving politicians money is even ok. I am saying lobbying groups help provide information to the government. For instance, my dues and other funds go into AARP. AARP presents petitions and reports to the government and lobby to have healthcare costs for seniors reduced or to limit how much big pharm can charge for insulin. How do they manage to present those positions - with money from people like us and other people who donate to AARP. However, lobbying should not include being able to donate to political campaigns or host dinners for a politicians fund raising campaign. It certainly should never be allowed to bribe a government.
I agree with Lizzie that lobbying is even necessary in some cases, but only if free of money transfer, direct or implied. As an example, I am engaged with others to stop a stupid decision (in our view) by our Ministry of Transport who want to shift a potential hazard off their state highway and shift it to local government. My view is if they want to change things, they should take liability for subsequent things that go wrong and not pass the buck. The point of this is politicians may not be even aware of what is going on, so lobbying is required to make sure they know. Rewards/punishment occur at the next election.
Petitioning your government, and by extension your representatives, for redress of grievances is a right. Retaining counsel in furtherance of those petitions seems a reasonable course of action.Where I take issue is the money. Campaign donations, fact finding junkets, and fund raising events are easily viewed as bribery.
One attitude can be - well, that's the way it is and there is nothing we can do about it. We should concentrate on our own personal battles for money and glory and leave grand theoretical issues to lazy bums who have time to waste on them.. -:) Legit, but too passive for my personal liking..
The other side of the scale would be - hey revolution! -:) There are only hundreds of those versus millions of ours. Let's dismantle the flawed system that we have and build something new and shiny. The problem with this course is that radicals prompting for violent resolution of any injustice seem incapable to build anything fair and just afterwards. Evidenced by the history. And besides, we don't have anything with a proven record that is better than the existing system. So, I don't think that any drastic approach is a good and viable solution.
So what then?
Well, the current system is supposedly giving the majority the possibility to enforce its agenda. Can we use more actively the means given to us by the system? I think - yes. We can strive and advocate for more instances of direct democracy. We can try to hold accountable (politically) our representatives when they neglect their promises. These are trivial and obvious things. Anything else?
Yes. Shaming, for example. Customer boycott, things like that. They seem to work. I know some of Russian/Ukrainian oligarchs are denied entry to the US and some other countries. This stigma often bars them from doing business with international business community. Is it effective? To a degree - yes.
Similarly, if certain businessmen would become unhandshakeable because of their ethics, they might think twice whether to employ them. After all, many of them are very particular about creation of a positive public image.
I know instances when public outrage prevented write-off of a substantial debt to one of the tycoons. In the wake of public antagonism the bank decided to back away from the pardon and not to risk losing indefinite number of clients and endanger its reputation.
It's hard to see through clever disguises and manipulations sometimes, but where it's possible the negative public opinion, spread like fire on social networks, is a powerful tool, which no one neglects these days and which can effectively counterbalance lobbying influence of the big biz. Awareness is a big step forward I think, because public attention that's something one avoids when doing shady deals.
Most businesses can't weather out a customers' boycott, meaning that flawed practices can be punishable.
Yeah, the above are not too sexy and immediate, but something to bear in mind and maybe a little better than simply putting up with what is considered deficient.
What's your attitude?