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View Diary: CSI: Federal Reserve (221 comments)

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  •  But (6+ / 0-)
    Recommended by:
    pb, newjeffct, Shadan7, BobOak, jct, malharden

    All the rich executives hearken back to the era of Eisenhower as a wonderful time in America.

    I support a tax reform program that returns us to that time, to help them feel even more at home (brackets and deductions adjusted for inflation).

    Single payer universal healthcare coverage saves money and saves lives.

    by freelunch on Wed Feb 07, 2007 at 11:04:26 AM PST

    •  More like the era of... (2+ / 0-)
      Recommended by:
      jct, lams712

      ...JP Morgan and Carnegie and Rockerfeller...

      Thanks,

      Mike

      •  Maybe (1+ / 0-)
        Recommended by:
        Canadian Reader

        Though executives were under the thumb of shareholders back then. Besides, I was trying for the snark: The top income tax rate was effectively 87% during the Eisenhower years.

        Single payer universal healthcare coverage saves money and saves lives.

        by freelunch on Wed Feb 07, 2007 at 11:28:27 AM PST

        [ Parent ]

        •  inequality is a function of financialization (6+ / 0-)

          Income inequality is more a function of the financialization of the economy, where the total amount of stocks, bonds, futures contracts, foreign currencies, and other financial instruments traded in just one week is larger that the entire gross domestic product for an entire year. With four decades of deregulation, our economy is now skewed to reward financial manipulation rather than real work. That’s the real secret behind Shrub’s "ownership society."

          Once you realize just how massive the shift toward financial speculation has been, you also realize how skewed the tax system, which right is based on less than one percent of an economy bloated with financial games. Just look at this pie chart:
          http://www.apttax.com/...
          http://www.apttax.com/...

          With financial turnover at over $500 trillion a year in the U.S., a tax on financial turnover of just one fifth of one percent would yield one trillion dollars in revenues.

          http://www.newrules.org/...

          The New Rules Project - Designing Rules As If Community Matters
          Tobin Tax

          In 1970 more than 95 percent of currency trades were for activities linked to what many call the "real economy" -- investment, tourism, foreign aid, trade. Today only two percent are. The volume of currency trading is now some 50 times greater than the volume of trade in goods and services. We trade more than $100 worth of stock and bonds for every dollar raised for investment in new plant and equipent, a ratio almost four times greater than 30 years ago.

          This delinking of money from place and productive investment is not the inevitable result of technological advances or economic evolution. Money is a human invention and rules that control its dynamic are also a human invention. To slow down the speculative and destablizing flow of money, John Maynard Keynes proposed a small financial transaactions tax in 1930. In the 1970s, Nobel Prize winning economist James Tobin proposed a tax on international financial transactions. The modest tax could dampen volatility and encourage longer term investment. Today traders hold assets for a few hours, or even a few minutes. They are happy with a very small return on each trade

          Telling a conservative the truth does about as much good as shoveling fleas across a barnyard. - The shade of A. Lincoln

          by NBBooks on Wed Feb 07, 2007 at 11:43:40 AM PST

          [ Parent ]

        •  I'm not so sure... (0+ / 0-)

          I used to agree that high executive pay is due to weak shareholder control over management, but I'm not so sure.  Private Equity Firms pay executives MORE than public firms (there was a NYT article on this in the past 5 weeks).  Say what you will about private equity, they are smart and self interested and will not pay more than they have to.

          (I suppose some of that increase is due to the fact that PE firms can/have/will fire executives for poor performance, something that almost never happens at public companies, bu I doubt that that is the whole difference).

          These days I think this is probably a complex, hard to understand issue, and I'm not sure its all 'weak shareholders and strong management'.

          •  Partially (0+ / 0-)

            Remember, though, that most of the private equity firms have arrangements with their investors that effectively skim from the investors. Most firms that are really private generally have executives with substantial or controlling interest in the business.

            Single payer universal healthcare coverage saves money and saves lives.

            by freelunch on Wed Feb 07, 2007 at 01:17:47 PM PST

            [ Parent ]

    •  Wasn't the top rate 90% back then? (1+ / 0-)
      Recommended by:
      Devilstower

      The top tier income tax was like 90%, no?

      I'm not a member of an organized political party, I'm a Democrat - Will Rogers

      by newjeffct on Wed Feb 07, 2007 at 11:22:35 AM PST

      [ Parent ]

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