dagblog - Comments for "Romney's IRA: Unearthing the Golden Goose."

A clear accounting of

Aunt Sam — Thu, 26 Jul 2012 05:06:44 +0000

In reply to and Maureen Dowd is basically

A clear accounting of Romney's contacts with Bain has been hampered by his presidential campaign's reluctance to discuss the period in detail and complicated by conflicting accounts in some of Romney's comments and financial reports. Both the Romney campaign and Bain have declined to provide documentary materials that could shed light on Romney's role after 1999.......By STEPHEN BRAUN and JACK GILLUM

and Maureen Dowd is basically

artappraiser — Thu, 26 Jul 2012 03:09:25 +0000

In reply to "Silence" on these questions

and Maureen Dowd is basically making the case that he will probably never answer these kinds of questions or release docs on finances voluntarily:

[....] Romney is so secretive that he’s beginning to make the über-clandestine Cheney look like The Bachelorette.

The Boston Globe reported Tuesday that although Romney promised “complete transparency” when he stepped in to save the Salt Lake City Olympics, he became a black hole: “Some who worked with Romney describe a close-to-the-vest chief executive unwilling to share so much as a budget with a state board responsible for spending oversight. Archivists now say most key records about the Games’ internal workings were destroyed under the supervision of a staffer shortly after the flame was extinguished [....]

Romney spent $100,000 in state funds to replace office computers at the end of his term as governor and on the cusp of his 2008 presidential race, “as part of an unprecedented effort to keep his records secret,” reported Mark Hosenball of Reuters. Eleven Romney aides “bought the hard drives of their state-issued computers to keep for themselves,” Hosenball wrote. “Also before he left office, the governor’s staff had e-mails and other electronic communications by Romney’s administration wiped from the state servers, state officials say. Those actions erased much of the internal documentation of Romney’s four-year tenure as governor.” [....]

PP - You forgot the part

NCD — Wed, 25 Jul 2012 15:47:38 +0000

In reply to You make a lot of assumptions

PP - You forgot the part about financiers like Goldman's Fabulous Fab being job creators, that we must lower their taxes and roll back financial regulation, that Wall Street is a bastion of the self-regulating free market, and that strawberry pickers caused the housing crash forcing GWB to bailout Wall Street in 2008.

You make a lot of assumptions

PeraclesPlease — Wed, 25 Jul 2012 06:14:43 +0000

In reply to You are not reasoning

You make a lot of assumptions about the owners of wealth, as simply "possessing it".

Yes, people who are naturally confident, who have resources behind them, etc. are able to negotiate better deals than the weak and unconnected - thus unions and worker protection laws, etc.

However, even if they aren't socially weak, if there are cheaper alternatives to that resource, then their bargaining power is limited.

Is a CEO worth $50 million a year? (not many make this) Depends on the returns he brings to the company, and what would happen without him. This isn't always transparent, but obviously a Larry Ellison or Steve Jobs has shown the upside.

In terms of capital, people invest with funds because of perceived ability to wade the financial waters with greater chance of success. (Buffett excelled with this at Berkshire Hathaway). It's not just the returns - it's also the limited risk, the reputation, etc. Otherwise people wouldn't invest in bonds.

But you seem to be arbitrarily dismissing the handling of money as work, while presumably anything else from playing lead guitar to rocket design to showing real estate to running a shake machine to directing traffic. But of course it's a real job, and requires connections, understanding the market & players, knowing the ropes. It can be a disaster, as Dimon's efforts showed, with huge sums to lose.

The issue is less the compensation for finance - it's how the system has been gamed to illegally take out all risk. They're showing each other their cards, so not only do they have legitimate bargaining advantage, they have illegal inside information, collusion, and then get the laws changed to guarantee them additional payouts (or use their access to get government cronies to send the deals their way).

All of this is far away from the basic principle that people need venture capital and loans to set up homes and start up businesses with good ideas, and they need finance and management smarts to reorganize or sell off failing or struggling businesses. Workers get hurt from a badly managed bankrupt company or from a company bought out and stripped of assets. Part of that can be blamed on the economy, the market, bad management, bad workforce, and in some cases predatory financial practices. Society gets helped by a fluid, well-monitored financial system, which is why when running better, the US is much more efficient at building new businesses than any other country. But we keep trying to slaughter that goose that lays the eggs.

You are not reasoning

Dan Kervick — Tue, 24 Jul 2012 20:16:09 +0000

In reply to If I buy a smoothie at the

You are not reasoning carefully. Whether or not the labor of the 7-11 employees, or other employees, is being exploited by you, or by others, depends on what those employees are given in return for the value they have created.

If two people are chained naked to a bench at 7-11 where they are compelled by the 7-11 owner to make smoothies all day in exchange for subsistence food, and you then avail yourself of the opportunity to pay the extremely low price for smoothies that such slave labor permits the owner to charge, then you are indeed participating in their exploitation.

Most work conditions are not so starkly brutal. But the same issue arises in one degree or another with all of them.

What you are really exchanging is usually your own work, since the money you used to make the purchase was probably given to you in exchange for some work you did. So one question you can ask yourself is whether the work you did to earn the money to buy the smoothie is equal in merit or value, or in some other way, to the work that was done to produce the smoothie.

The important issue here is private property ownership and the extremely valuable rights that our society has chosen to assign to private property ownership. If 100 capitalists decide to give $100 million dollars of their own money to the CEO of 7-11 to buy equipment and inputs, and employ workers (including the CEO) at a salary determined by the CEO; and if as a result 7-11 produces goods for sale bringing in $150 million, then the 100 capitalists are entitled to keep the $50 million profit in addition to recovering the $100 million invested - unless we tax some of the profit away from them. This is true even if they literally did nothing other than transfer the $100 million to 7-11's operating account, and negotiate the wage paid to the CEO for services rendered.

You might think that this system "works" pretty well. But there is something very unsettling about people receiving that much value in exchange for so little work and effort, while others receive so much less value in exchange for so much more work and effort. What justifies a system in which a person can transform $100 million into $150 million, having done only a few hours of low impact work? Let's assume, for the sake of argument, that the investors had absolutely earned or merited the initial $100 million stake - the property they committed. It is still hard to see that the additional $50 million is commensurate in any way to any kind of additional merit on their part.

Nor did the $50 million in additional value generated simply fall from the sky. That $50 million came from the value that was added to existing goods by the application of human labor. So we can't say that the capitalists merited reaping that value in the same way that we are entitled to the air we breathe.

Why were the many workers in the chain willing to exchange their labor without claiming a larger share of the $50 million profits? Because they are socially weak, and lack the bargaining power to claim it. In our society, the sheer bargaining power that goes with ownership, wealth and inequality is regarded as a legitimate basis in itself for the flow of produced added value to owners, even if those owners do absolutely nothing else with the wealth other than possess it. That's disturbing, even though many are not disturbed by it.

(oddly, George Romney ran for

PeraclesPlease — Tue, 24 Jul 2012 20:04:17 +0000

In reply to Mitt is the latest straight

(oddly, George Romney ran for president in 1968 despite having been born outside the US - seems the term "natural born" applies to anyone with a parent who's a citizen, as citizenship then comes automatically)

Is Mitt denying legal immigrants refuge or only illegal ones? And were his ancestors illegal?

While we may, without risking

jollyroger — Tue, 24 Jul 2012 19:35:09 +0000

In reply to Seems I made that argument

While we may, without risking the accusation of excessive optimism , hope that eventually the pitiable taxpayers will awaken to the sensation of their pockets being picked by Bain via the PBIC, that should not obviate entirely an examination of the requirement that a business model create real value (eg. Google) vs. simple rent, ex consideration of the underlying *effort or absence thereof on the part of the. beneficiary. *I say this secure in my status as the lazyist man in the country, creating value by getting high and then coming up with patentable pipe dreams.

Oh Beavis! You said

jollyroger — Tue, 24 Jul 2012 19:24:35 +0000

In reply to Mitt is the latest straight

Oh Beavis! You said compassion and Republican in the same paragraph! Heh heh.

Mitt is the latest straight

NCD — Tue, 24 Jul 2012 18:25:25 +0000

In reply to Romney's IRA: Unearthing the Golden Goose.

Mitt is the latest straight talking, never tell a lie or take responsibility, candidate of Republican Party.

He is the product of, and comes from a long line of self proclaimed GOP American patriots, whose unquestioned devotion and loyalty to this nation, its Constitution, and its people, only wavers when they were subject to its laws. In the case of Mitt's ancestors, sending them south across the border.

It is now Mitt's intention, to deny refuge to those among us who came from the nation that gave his father and his ancestors sanctuary. What else can you say, except that he is grasping, self promoting guy, devoid of gratitude or empathy, who pays only what is legally required, be it in taxes, Mormon tithes or compassion for his fellow man.

Seems I made that argument

PeraclesPlease — Tue, 24 Jul 2012 18:23:18 +0000

In reply to "Silence" on these questions

Seems I made that argument the other day.

Unless Democrats focus on real scandals - like Romney stealing the pensions of workers, leaving them out of work and penniless - we're just making him immune to future criticism.

But we like to focus on him having big houses.