State-Wrecked: The Corruption of Capitalism in America

Wow! David Stockman gets it. Excellent read.

“If this sounds like advice to get out of the markets and hide out in cash, it is.”

This is not necessarily my advice. It is David Stockman’s, just to be clear. We don’t offer investment advice here.

Attached is an excellent op-ed in the New York Times from David Stockman which comes on the heals of the release of his new book, The Great Deformation, which we reviewed in the previous post.

In the op-ed Stockman explains that in order to get a handle on things economically, in order to restore some sanity to markets, in order to root out the system of crony capitalism we now live under, radical changes must be implemented. Changes which are too radical for reality (at least current reality) Stockman readily admits.

Key to it all is a separation of free enterprise and the state. But I don’t see Jack “Mr. Citibank” Lew going for that anytime soon. Or Mr. Obama giving back the “donations” from big business to Organizing for Action. Or nearly anyone in Congress sending back any checks or turning away lobbyists.

(From The New York Times)

As the federal government and its central-bank sidekick, the Fed, have groped for one goal after another — smoothing out the business cycle, minimizing inflation and unemployment at the same time, rolling out a giant social insurance blanket, promoting homeownership, subsidizing medical care, propping up old industries (agriculture, automobiles) and fostering new ones (“clean” energy, biotechnology) and, above all, bailing out Wall Street — they have now succumbed to overload, overreach and outside capture by powerful interests. The modern Keynesian state is broke, paralyzed and mired in empty ritual incantations about stimulating “demand,” even as it fosters a mutant crony capitalism that periodically lavishes the top 1 percent with speculative windfalls.

http://www.againstcronycapitalism.or...in-cash-it-is/

More from the NY Times op-ed:

Within weeks of the Lehman Brothers bankruptcy in September 2008, Washington, with Wall Street’s gun to its head, propped up the remnants of this financial mess in a panic-stricken melee of bailouts and money-printing that is the single most shameful chapter in American financial history.

There was never a remote threat of a Great Depression 2.0 or of a financial nuclear winter, contrary to the dire warnings of Ben S. Bernanke, the Fed chairman since 2006. The Great Fear — manifested by the stock market plunge when the House voted down the TARP bailout before caving and passing it — was purely another Wall Street concoction. Had President Bush and his Goldman Sachs adviser (a k a Treasury Secretary) Henry M. Paulson Jr. stood firm, the crisis would have burned out on its own and meted out to speculators the losses they so richly deserved. The Main Street banking system was never in serious jeopardy, ATMs were not going dark and the money market industry was not imploding.

http://www.nytimes.com/2013/03/31/op...nted=all&_r=1&

You really need to read the entire op-ed by Stockman. It is very complete, and he takes no prisoners. We are heading for a disaster of biblical proportions. Stockman explains why and how this happened.

Peak Prosperity

Uh, think Las Vegas, too. Every institution does whatever it can to perpetuate itself.

Compulsive gamblers with their enabling sugar daddy the fed.

Great pod cast. Thanks.

And your guy, Obama, is/was the pit boss!

Fuck you and your kind for voting for Las Vegas casino government.

Uh, think Las Vegas, too. Every institution does whatever it can to perpetuate itself. Originally Posted by Randy4Candy

And your guy, Obama, is/was the pit boss!

Fuck you and your kind for voting for Las Vegas casino government. Originally Posted by Whirlaway

You do realize what Stockman says about your hero don't you? Well of course you don't.......


http://rationalrevolution.net/war/trickle_down.htm


In the 1980’s Ronald Reagan ushered in a new era in American economics as he cut the top tax bracket from 70% down to 50% and then down again to 28%. In order to get support for doing this from the people, and also from politicians, a very crafty set of lies were produced. As David Stockman, then Reagan’s budget director, put it: giving small tax cuts across the board to all brackets was simply a “Trojan Horse” that was used to get approval for the huge top tax bracket cuts. “Trickle-Down” was a term used by Republicans that meant giving tax cuts to the rich. Stockman explains that:

"It's kind of hard to sell 'trickle down,' so the supply-side formula was the only way to get a tax policy that was really 'trickle down.' Supply-side is 'trickle-down' theory."
"Yes, Stockman conceded, when one stripped away the new rhetoric emphasizing across-the-board cuts, the supply-side theory was really new clothes for the unpopular doctrine of the old Republican orthodoxy."
"…the Reagan coalition prevailed again in the House and Congress passed the tax-cut legislation with a final frenzy of trading and bargaining. Again, Stockman was not exhilarated by the victory. On the contrary, it seemed to leave a bad taste in his mouth, as though the democratic process had finally succeeded in shocking him by its intensity and its greed. Once again, Stockman participated in the trading -- special tax concessions for oil -- lease holders and real-estate tax shelters, and generous loopholes that virtually eliminated the corporate income tax. Stockman sat in the room and saw it happen."
"'Do you realize the greed that came to the forefront?' Stockman asked with wonder. 'The hogs were really feeding. The greed level, the level of opportunism, just got out of control.'"

The Education of David Stockman 1981:
http://www. theatlantic. com/politics/budget/stockman.htm
Reagan's policies did more than simply cut income taxes. A large number of tax loopholes were written into the tax code that catered to special corporate interests. In fact many of the current scandals involving companies such as Enron are rooted in laws that were passed during the Reagan administration that gave these companies more legal legroom to work with and less oversight.
In addition, the small “income-tax cuts” that were given to the middle and lower income tax brackets were countered with new taxes that were directed at middle and low income individuals, as former House Speaker Jim Wright said:

Reagan's tax increases fell mainly on consumers, low- and middle-income people. Sales and excise levies. Reagan didn't call these taxes. They were, in his euphemistic lexicon, "user fees" and "revenue-enhancers."

I don't know what you are talking about "hero"..............if you have me calling Reagan a "hero", please provide a link or something supporting your bullshit.

Otherwise, nice attempt to deflect by going back 30+ years.........what Obama and the Democrats are doing to America (today) makes Reagan look like a piker !

Definition of PIKER:

1 : one who gambles or speculates with small amounts of money
2 : one who does things in a small way; also : tightwad, cheapskate

America (Americans) would be better off with more "tightwads" in Washington.

Fuck you and your big government thinking.

Fuck you and your big government thinking. Originally Posted by Whirlaway

LOL, Fuck you and your behind the curve thinking. I have talked about the banks for jumpstreet.

You and another one of your God Damn hero's Milton are frauds.

Again, you make a statement, then can't back it up with facts....

So what do you do ? You deflect with more unsubstantiated bullshit about Friedman........

Again, you make a statement, then can't back it up with facts....

So what do you do ? You deflect with more unsubstantiated bullshit about Friedman........ Originally Posted by Whirlaway

You love Reagan. You think he was some small government wonk.

Do you deny that? I do not feel like searching your posts but you have defended Reagan like he was your boyfriend!

Next you'll be saying you never said Romney was going to win! You let Tea Tards fill you with BS and then you come and try and spar that shit all over everybody!

The modern Keynesian state is broke, paralyzed and mired in empty ritual incantations about stimulating “demand,” even as it fosters a mutant crony capitalism that periodically lavishes the top 1 percent with speculative windfalls.

. Originally Posted by CuteOldGuy

This is why Romney lost. He was that 1% Stockman is talking about. That 1% is the tail that wags the dog.You ignorant Tea Tards are m,ere flea's.

Nice try to backtrack away from where we are today...

Your deflection might work with other dimwits like yourself, but not for those with a mind for themselves.

WTF talking out of his asshole (see below):

This is why Romney lost. He was that 1% Stockman is talking about. That 1% is the tail that wags the dog.You ignorant Tea Tards are m,ere flea's. Originally Posted by WTF

Romney isn't president; has NEVER been president, and never will be president.....

But WTF wants to tie Romney into the policies that Obama has pursued....with an overwhelming number of dumbed-down voters like WTF in America, no wonder we are fucked.

WTF talking out of his asshole (see below):





Romney isn't president; has NEVER been president, and never will be president.....

But WTF wants to tie Romney into the policies that Obama has pursued....with an overwhelming number of dumbed-down voters like WTF in America, no wonder we are fucked. Originally Posted by Whirlaway

We actually are not fucked. We have a wealth of new oil and gas. You Tea Tards are the most pessmistic turds in the bowl. If the government could just get healthcare costs under control we would be in pretty good shape.
We will not have to send our military overseas spending more in lives and money to procure more oil .

The problem with healthcare is ignorant puke's like you that can not have a rational discussion without crying "death Panels!".