Re: David Faber Report : Putting 2 and 2 together

Mike wrote:

<bandwith snip>

nothing whatsoever to do with anything i'm saying. which part of: "i
blame lack of adequate regulation" do you not understand?
Perhaps if you lighten up on the emotive adjectives like using "exploit"
as a synonym of "employ" we'd understand each one better. The latter is
a matter of fact; the former is a matter of opinion. When you use
emotive adjectives, one has no choice to assume that you're making
arguments on an emotive basis.


i can't use the word "employ" when the "exploit" i'm talking about is much broader. as i've said several times, there are many ways the robber barons "exploit" corporations, exploiting the employees is just one of them (there were others i described, but i'm tired of repeating myself so go back & reread the thread if you need to refresh your memory). and i suppose you'd prefer i use the term "captains of industry" instead of "robber barons", however, as both types exist (i didn't create the term "robber baron", you know) and i've been talking specifically about the latter i think i'll stick to the terms i've been using.

Feel free. However, if you're going to use terminology that is normally associated with marxism, don't be surprised if people think you're a marxist.



so I assume that you have some sort of political solution in mind,
stop assuming. you get it wrong every time you assume you know where
i'm coming from (despite my best attempts to make it clear).
See above. You play it very loose with the english language.


and am trying to get to it. You've now provided a bit of a framework
(in the above paragraph) as to what you are thinking, although it's
clear from history (which you've cited some of) that there (1) has
never been any regulation -- or taxation structure -- that has
prevented the massive accumulation of wealth, so (2) the problem
cannot be the goverment's failure to enforce anything, since you can't
fail to enforce something that has never existed.

no, what happens is that the laws get put out there right after the
exploitation pendulum swings so far that public outrage against
corporate excesses rise to the point that politicians do what needs to
be done to limit the exploitation (like what's going on now).
You think the broad public is pissed at the broad spectrum of corporate
management? LOL. They're pissed at a dozen CEOs from Wall Street.


since you apparently didn't read the very next part of my reply which addresses that very issue i'll repeat (quoted from my previous reply 3 lines down):

"and it's not necessarily an all-encompassing thing either, the "pendulum
cycle" occurs in different industries at different times."

.....assuming there's a cycle like this at all, of course.


then over the
subsequent years/decades, the corporations begin to get the laws
changed to benefit themselves and the whole cycle starts over. and
it's not necessarily an all-encompassing thing either, the "pendulum
cycle" occurs in different industries at different times.


Further, i have serious doubts about the ability of government to
prevent massive accumulations of wealth in a global economy. In fact,
I don't believe it is possible.

"massive accumulation" is a relative thing. with regard to the
pendulum cycle describe above, "massive accumulation" is maximized
right before public outrage reaches sufficient level to drive the
pendulum back the other way (and much smaller right after).
Never seen it change due to government action. Seen it change as the
maturity of the economy developed, but not due to government actions.


you probably never heard of the "trust busters" & the "corporate robber barons" either.

I have. Read histories about them, actually.




i don't know about your statement: "they tend not to last that
long". that may be true and if so it's probably because because
they either give the money to charity or to heirs (that never have
the business mind of the parent) who just lose/blow it.
No. THEY don't last that long. CEO's are not usually CEOs for long
periods of time. Founders may be, but for most CEOs who are hired or
rise through the ranks, they reach that position sometime in their
50's, and so even if they avoid trouble and don't get fired, they
maybe get a decade in the position before they retire.
never said they did and the group i'm talking about is not limited to
ceo's. i'm talking about $billionaire corporate robber barons in
whatever form they exist to extract wealth from corporations. you've
not not offered any other source of the great wealth obtained by the
"world's richest billionaires" so apparently we agree that
corporations are the source of the wealth, just disagree as to how
well unregulated capitalism works at distributing the wealth.
Not even that. Unregulated capitalism will always wind up with a
massive accumulation of wealth in the hands of the few. That's not
controversial. That's pure Adam Smith.

yes, but there's no need for it to be so "massive" that it eliminates
the middle class.
That's what Smith warned of, however.

to sum up our differences on this point if i may (another of my mini-
recaps):

you are satisfied that unregulated capitalism will fairly distribute
wealth, my position is that unregulated capitalism will create a
completely bipolar living standard where all the wealth is in the
hands of a few corporate robber barons and all the workers are in
poverty (and i know i'm repeating but it's the most important point
i've been trying to make)
Nope. I said multiple iterations ago that unregulated capitalism is
the best way to create massive amounts of wealth. That's good, becuase
it gives government the largest pool of money possible form which to
fund redistributive policies. Regulated capitalism results in pools of
wealth which are less massive, and thus the redistributive policies
must be more modest.

99% of the population doesn't care if the pool is larger if their share
of it is smaller in absolute terms.
99% of the population doesn't care that a billionaire is a billionaire,
either,


no, they care about the money being sucked out of their wallet by the billionaire corporate robber baron black-holes in the form of lower pay & higher prices.

Do they? I suspect that they'd like a raise. Period. I doubt most americans are running about with all that charged rhetoric on the tips of their tongues.

you claim they can suck an infinite amount of $ out of
the system with no adverse effect on the rest of us but you've provided no evidence to support that and everything i've ever learned or read about economics says the exact opposite.

Sheesh. We were talking about billionaires. Most of them got that way because of the stock market. If they started with a million shares worth a penny and getting paid $100K per year, and those shares go up a thousand fold, they're billionaires, without taking a dime more than the 100K. (In a nutshell, that's a direct description of how Buffett made his money.)

but i've got an open mind so
enlighten me, exactly how can the $billionaire corporate robber barons suck an infinite amount of $billions out of the economy and not drive down the wages of workers and raise prices for consumers in the process?

See above.

and if you're going to say increasing the money supply is the answer, please explain how that won't adversely affect the working class by wiping out the value of their savings (well, if they had any savings which right now apparently few do, but that's beside the point)


although you insist above that the disturbance over it is so
acute that the government moves to lower the wealth gap (although you
give no examples how).


only need one: enforcement of antitrust law

All for it.

the example was msft, convicted of violating antitrust for which they got a slap on the wrist, a nod & a wink and back to business as usual, same old non-level playing field, market distorting, $billionaire black hole money sucking leech that it is.


in other words, the working class
doesn't care whether the billionaires have more or less $billions, they
only care about their own piece of the pie. and while we agree that
unregulated corporations will generate more profits, it's my position
that the additional profits come from further exploitation (because
we're talking about the additional profits obtained from removing the
so-called "profit limiting" regulations that were put there to prevent
exploitation in the first place)
....and which I don't agree exist.....


you've said a number of times that all regulation reduces profits. now you're saying that regulations don't reduce profits? which is it?

You know, I don't know what the hell you're talking about, and I'm pretty sure you don't, either. So let's cut to the chase.

Corporations maintain profit margins. Those margins are jealously defended. If a new regulation appears, it costs money to implement it. Profit margins decrease. The business reacts to maintain it's margins by cutting expenses.

What's the easiest and fastest thing to cut in order to maintain those margins?



once
again i can't pin down your stand as you seem to be on both sides of the issue.

Dude, you're the one with the undisciplined mind. See above. There is nothing ambiguous about the reality of regulations. That they limit profits is certainly not a mere opinion.

(and if you're going to nitpick my use of the word "limiting" let
me say that in that context it can also mean "reduce" which is the way i meant it (and i've already made it abundantly clear that i'm against putting limits on income or wealth))


hence i fail to see the logic that shows how a bigger
pie translates into more $ for any but the wealthiest.
...because we disagree one the above underpinning of your argument.

in the case of charity, people are
quick to give praise, but why should one person be in charge of
distributing to charity the wealth that was created by hundreds of
thousands of workers?
Because it's theirs.
only because they were able to exploit an unregulated capitalistic
economy. my point is that with proper regulation the distortion of
concentrated wealth into the hands of an individual would never have
occurred in the first place.
And that helps the worker guy.....how? It doesn't help the worker a
bit if the rich guy is less rich. He didn't get the money. It was
never earned by the company in the first place, because of the regs.

there you go again, from one extreme to the other. my answer to this
(that i've said several times already) is that all the products &
services will get produced just the same
Disagree. There will always be differences.


please identify what products/services would not be available to us that can only be provided by billionaire corporate robber barons and why it wouldn't be possible for anyone to produce such products/services without their obtaining $billions for producing them.

"So, when did you stop beating your wife?" Can't prove a negative. You can only use a little logic.

No two minds are alike. They will always invent or innovate in a different fashion. The winner in any free market competition is the one who executed the product cycle the most successfully. If you get rid of the winner, the new "winner" will be one of the losers, obviously. You know that because there weren't two winners (companies with equivalent product success) before you subtracted one.


and with just as many jobs
because for every black-hole billionaire running a company there are
others capable of accomplishing the same for a lot less.
But, even if so, won't.


yeah right, the PC never would have happened had not some corporate robber baron sucked tens of $billions out of the economy. for those that don't get sarcasm, newsflash: the PC would have happened regardless of whether or not any one individual was able to suck tens of $billions out of the economy.

No question. The *question* that is unanswerable is if the new winner's product offering would have been as useful (and thus universally adopted) as the one that won. Jury's out.


Whoever takes the place of the existing guy will
do so with the same intent in mind -- to get rich.


and again you're arguing against a point i'm not making. i have no issues with "captains of industry" making as much money as they possibly can. it's enforcement of antitrust law that makes the difference between my position and yours.

I doubt it. I expect the real disagreement is our respective definitions of the term "antitrust."


and before you
go accusing me of claiming that i'm equating top execs to workers,
that's not what i'm saying at all. geez, it only takes one other
person with the opportunity (as in not shut out by anti-competitive
tactics)
Which we disagree exist.


so now you're denying that msft shuts out competitors with anti-
competitive tactics? i thought you agreed to that already?

pick a side:

1. msft uses anti-competitive tactics (which contradicts your above statement)

2. i'm in denial of the whole msft antitrust conviction thingy

You think the matter is really that simple? :-) Wow.

Like all corporations, MSFT uses anti-competitive tactics. Big Whup. I expect them to do so. Hell, I expect MY company to do so. That is not what's in question.

Your sentence above "as in not shut out by anti-competitive tactics" displays a flawed understanding of business dynamics. All successful companies are engaging in anti-competitive tactics. That's legal. HOWEVER, if an anti-competitive tactic is such that (or so successful that) it restricts the available choices to that company's product only, or such that the comapany manages to obtain full pricing power in the market, that's not legal. That's when the law rightly gets involved.


<snip>

microsoft has been using the linux excuse
for years to avoid being branded a monopoly, but at this point that's
still all it is, an excuse.


As much as I hate to defend MSFT, you are omitting (or overlooking
intentionally) the concern of the corporation towards the cost of
retraining and lost productivity in the interim. As the interfaces on
Linux improve, we both know that this is FUD, but MSFT isn't holding a
gun to anyone's head on this one. And, the fact that you are aware that
Linux servers are now relatively common proves that the companies know
how to buy non-MSFT, and they know not to be afraid of MSFT.


no, you're overlooking (intentionally?) the microsoft "tax" on the vast majority of corporate desktops sold. you do understand the difference between "desktop" and "server", do you not?

I've run datacenters in my career, ***.

and do you also understand
that the PC linux server market is very small in terms of the number of units compared to the desktop market?

Do you?

(not to mention the fact that most
of those linux servers were probably originally purchased with windows licenses to begin with) in terms of the overall number of corporate PCs sold (which are mostly desktops) the number of linux servers is very small in terms of market share, hence msft still levies its monopoly "tax" on the vast majority. for evidence just look at msft quarterly revenue, it's all msft "tax".

We don't pay it at my place. What other companies do is entirely their affair.


now back to my original point, the fact of
the matter is almost all corporate desktop computers sold include the
cost of a windows license. you cannot order a PC from any of the major
computer companies and get the cost reduced by $100 by telling them you
don't want to pay for a windows license because you're going to put
linux on it.

Sorry. My company does. From Lenovo. This laptop is still Windows, but
we support our entire corporate application suite on Red Hat, and as our
laptops get refreshed on a four year cycle, we'll be off MSFT. The
company no longer approves purchase orders for Windows or Office, nor
purchases machines with licences for those products resident.


well that's just dandy,

Yea, it is. I guess you were wrong.

and at some point, hopefully in the not too
distant future, some usenetter will appropriately put me in my place for claiming that the vast majority of the market has not yet escaped the msft "tax" on desktops/laptops, but that time has not yet arrived. as i've said before, there's nothing that would make me happier than if it were true right now, but it's not.

this is "lock in" by microsoft and it's highly anti-competitive
(i mean, come on you have to buy a license for an operating system you
don't even want, how messed up is that?), try to spin it however you
like... oh, and don't give me the bologna about some computer vendor
selling a linux model, dell's got probably 100,000 possible model/
configuration combinations and a subset of a couple of choices (which
constitutes .00002% of the product line) for pre-installed linux (that
cost as much as one with windows to boot) does not qualify as choice.



the oil companies will be coining money again as soon as oil prices
start going back up, right now the only reason they're not coining
money is because of the massive recoil from the huge run up in oil
prices last summer, but when the market finally gets straightened
out oil prices will be going higher and they will be printing money
again. and they won't be using the profits to increase oil
production either (as they haven't been doing for years).
But they provide value. Oil doesn't just jump up out the ground and
say "stick me in the barrel."
only said msft provides no value. oil companies provide value but
they're no longer using the bulk of profits to expand supply, so at
this point they're mostly just exploiting the market imbalances
they've created by taking advantage of an inadequately regulated
economy to line the pockets of the fat cats (the guy at the top & his
cronies most of which are just corporate "pork"). it's almost funny
to see the oil companies getting hammered as of late because the
backlash from the scam run by wall street to manipulate oil prices
(ie. the huge oil price drop) has thrown a serious monkey wrench in
the scam the oil companies have going, but no worries, as i said
before they'll be coining money soon enough when oil prices head back
up...(and the oil robber barons know it or else you'd see those whiny
idiots jumping ship faster than cockroaches run for cover when you
turn the light on)
Boy, you see evil everywhere. :-) Do you even bother with evidence, or
do you just fall back on that old tired "isn't it obvious" candard?

just telling it like it is... what, you didn't like my snipe at the
oil companies? fine, i rescind it (kinda like when the judge says:
"the jury will disregard those remarks!")



Ask the CEO of
Caterpillar if he thinks he has a "monopoly" with Terex and Deere
and Kubota and Mahindra running around the world.
i'm not saying there currently is a monopoly in every major
industry, that was just the logical outcome of the scenario of no
regulation at all.
Obviously, but free marketers acknowledge the need for government to
create a level playing field to insure adequate competition. That's
not in debate.
it is in debate if it is your position is that all regulation should
be eliminated, well since i covered this above i'll wait for response
as to your position before continuing...
Monopoly laws aren't regulations.

well once again let me attempt to pin down where you stand.

pick one:

1) against corporate regulations but for corporate laws

2) against both corporate regulations and corporate laws

3) for both corporate regulations and corporate laws

4) for corporate regulations and against corporate laws
More complicated than that. Government needs to maintain a level playing
field for the participants in the free market. Thus, you need to prevent
monopolistic practices AT LEAST. Depending on situations, you may need
an occasional regulation to accomplish any of the following:

1) Maintain the level playing field, as ambiguous as that concept is. 2)
Insure that corporations carry the risk for all their decisions 3)
Arbitrate matters of standardization where the natural process might
impede GDP.

JG


complicate it however you like, you're playing both sides of the field. half the time you don't want the gov't involved and the other half you do.

What can I say? Not everyone is an ideologue like you.

I listed you three items above. The latter two are straight from Milton Friedman's "Capitalism and Freedom." I guess you think he was on both sides of the issue, too. The first one is purely Adam Smith, but certainly also cited many times by Dr. Friedman.

Perhaps you're just personally uncomfortable with the complexity of the free markets.

JG







However, MOST regulations do not exist to disrupt monopolies.
ever heard of ANTITRUST regulations?
Regulations tell organizations how to conduct their daily operations.
Antitrust laws set limits on their interactions with their
competitors.

JG



and while it seems there currently is no regulation (because the
gov't stopped enforcing it) there was enforcement before (years
ago) so the market hasn't yet deteriorated into the complete
monopoly scenario. so, yes, there still are some competitive
industries.



with your stand that corporations don't need to be
regulated, taken to it's logical conclusion, there will be a
monopoly in every major industry with all the wealth in the hands
of a few corporate robber barons and all the workers at poverty
level.
If it wasn't for Taft Hartly and such laws, sure. Monopolies are
anathema to free markets, which is why we prevent them from
forming.
well are you against all regulation or not? seems to me that your
above statement contradicts being against all regulation, i mean if
you're against it you can't use it to support a point you're trying
to make.
No free marketer supports monopolies, and acknowledges the role in
the government in preventing them to form.

JG
again the thing with not seeing where you stand with your position,
will wait for response to above...




JG


177 was Valee of Avnet, making 10.2M. So, 177 CEO's behaving
highly irrationally. 301 was Martin of Pitney Bowes. 5.04M, so
that many CEO's behaving irrationally.

It's interesting to see who DOESN'T behave irrationally,
although they could if they chose to. Charles Schwab made 4.66M
in 08, August Busch of Aneuser Bush took 3.93M, Brock of
CocaCola took a relatively paltry 2.99M (makes me want to buy
the stock), Blake of Home Depot 2.41M (after the fiasco of the
previous CEO, who is now running Chrysler), Michael Dell 2M,
Davis of US Bancorp 1.72M (one of the largest regional banks who
is noted for avoiding subprime investing -- the guy performed,
big time), Bezos of Amazon.com 1.28M, Eric Schmidt of Google
480,000, and Warren Buffet of course fixes his own salary at
100K.

JG







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