Meet the 1%

Without venture capital firms there would be no Silicon Valley. Maybe that would have been a good thing. We would never have had the productivity gains from technology and workers would not have been replaced.

 

Patriots owner, Bob Kraft, of all people, points out that state & union pension funds are big investors in firms like Bain Capital:

I'll wait for unions to demand their pension funds divest themselves from such profitable investments.

 

Loansharks and banks both lend money. The difference between them lies not in what's being done, but how.

 

bdwp, I don't know if there is a moral distinction or not. What I DO think, though, is that Big Finance has inundated Washington D.C. with so much money in campaign contributions over the past generation that they have effectively purchased the levers of government to advance their interests, including special tax breaks on capital gains, tax policy that favors outsourcing, financial market deregulation, deemphasis of regulatory enforcement, deemphasis of tax enforcement, earned-benefits privatization efforts, and political cover for all misdeeds.

And these interests have been advanced to the detriment of middle class people.


Whether there is a moral distinction that should be made, I struggle with that and tend to think not simply because historically that has been such a calling card for anti-semites to argue. Don't misunderstand, I'm not saying that about your post but simply as a way of explaining something that informs my thinking on the matter. Regardless of whether or not it is immoral, however, there is no question that policies favoring Big Finance has been detrimental to the middle class.

 

A lot of interesting thinking here. Not sure I can add much. But I think we can all agree that people who make only $380k/year are not particularly wealthy.

 

The point isn't that <i>all</i> the unemployed had such majors. It's that the current breakdown of majors and the money being poured into it with government-guaranteed loans (and no bankruptcy relief) is a major structural problem. Young people are graduating with too much debt because of the education bubble, so they don't have enough disposable income. Meanwhile, many people are undertrained despite spending all that money.

Some of the people who have gotten laid off are high-skilled scientists and finance majors, but the proportions are smaller.

 

Not going to wade too far into this, because I don't see the world as a "1%/99%" mentality ... in part because I understand the economy to be too complex.

But firms like Bain Capital are kind of like the garbage cleanup of the economic system. They tend to buy dying companies to keep them afloat, often serving as the hatchet men along the way.

The one thing the 1/99 crowd doesn't understand is that the point of operating a business isn't to provide a public service. The point of operating a business is to make money, which allows them to then hire more workers. When business is profitable, workers have jobs. When business isn't profitable, companies like Bain will toss money into them to keep them afloat, and likely have to slash to the bone to keep it going. But without profit motive, business doesn't survive and none of us have jobs.

 

I think they absolutely are particularly wealthy. Are millions of people wealthier? Yes. But they are certainly extremely wealthy.

 

With all due respect, I don't think we can. It ain't yachts and mansions and Bentleys all day every day, but it ain't "not particularly wealthy" either. At 380k a year, my student loans and house would be paid off in year one with room to spare. I would have a fully funded retirement in five years. Anything beyond that would be all I would ever need for leisure, travel, and luxury. $380k annually not particularly wealthy?

 

A doctor in Chicago or Seattle with plenty of loan debt is not particularly wealthy at $380k. A bank president in a medium-sized town in the South or Midwest can live like a feudal baron.

 

I tell you what. You guys pool all your money together ... at least $380K/year ... and give it to me. I'll tell you if I feel weathly, or not. Mmmmkaaaay? Good.

 

Depends where you live.