EMAIL SIGN UP!
Most Popular This Week
- Wisconsin Bill Would Treat Organic Milk, Sharp Cheddar, Brown Eggs as "Junk Food"
- As Death Toll Rises Beyond 500, Garment Factory Disaster 'Worst in World History'
- Climate Change's 'Evil Twin': Ocean Acidification
- Patent Filing Claims Solar Energy ‘Breakthrough’
- Pregnant Anti-War Soldier Sent to Prison
- Move Over, Koch Brothers: A Bigger, Darker Rightwing Funder Is Out to Destroy Public Education
- Patent Filing Claims Solar Energy ‘Breakthrough’
- Time for Big Green to Go Fossil Free
- Wisconsin Bill Would Treat Organic Milk, Sharp Cheddar, Brown Eggs as "Junk Food"
- Climate Change's 'Evil Twin': Ocean Acidification
Popular content
Today's Top News
Arnold, Milton, and the California Nightmare
Naomi Klein on The Shock Doctrine, California style
Speaking at the University of California at Berkeley yesterday evening, award-winning journalist and author Naomi Klein lamented the sweeping budgetary cuts to education, women's shelters, and a host of critical social services that have rocked California in recent months.
“When these cuts are imposed, it’s constantly portrayed in the media as if it’s an unfortunate and painful necessity,” she said. On the contrary, she argued, the gutting of the public sector in California is no coincidence.
Klein pointed to an overarching conservative agenda that touts free-market capitalism and limited government, and resists raising revenues with tax increases. (We referenced Klein’s book, The Shock Doctrine: The Rise of Disaster Capitalism, in our cover story last week. So it’s also not a coincidence that our cover package, “The California Nightmare,” touched on many of the same themes.)
Klein showed a brief film clip that included footage of California Gov. Arnold Schwarzenegger praising the ideas of conservative free-market economist Milton Friedman. “What you always have to remember in this discussion is that your governor is a hardcore ideologue,” Klein said after showing a clip in which Schwarzenegger is seen gushing, “Dr. Friedman changed my life!”
“These pet Republican policies have been lying around,” Klein said.
“These ideas are still incompatible with democracy, still deeply
unpopular.” Nonetheless, they’re being rolled out in uncertain times
and unstable places, according to Klein, while masquerading as
emergency measures.
During the federal bank bailout last fall, there was a lot of talk about pending disaster and burning houses to justify saddling taxpayers with such an extraordinary sum, Klein noted. “You really know how houses were on fire in California -- but these were metaphorical houses.” She also mentioned that Goldman Sachs handed out $23 billion in bonuses this year. “That is the same size as California’s budget shortfall,” she pointed out.
“A private sector debt crisis was turned into a public sector debt crisis,” Klein said. “And the bills are coming due.”
Speaking directly to UC Berkeley students who will be affected by pending tuition increases, Klein characterized the impact on the public university system as “a physical embodiment of a great injustice that you are being asked to pay for.” She urged the students to fight it.
“Maybe there could be strategy where all of the people who are under attack can intermingle and converge,” Klein said, “so you actually become too big to fail.”
Comments
Note: Disqus 2012 is best viewed on an up to date browser. Click here for information. Instructions for how to sign up to comment can be viewed here. Our Comment Policy can be viewed here. Please follow the guidelines. Note to Readers: Spam Filter May Capture Legitimate Comments...
98 Comments so far
Show AllThe majority of Californians are so far ahead of the rest of us.
Where else would you throw a governor out of office because of energy shortages and costs increases which were largely caused by a corrupt corporation called ENRON and then have a special election to install an unmanned predator drone who admires and defend the ideas which enabled ENRON to become as influential as it was?
But then, California has a history of predator drones (Nixon, Reagan) in the governor's mansion.
Got one for you...enron?
CBS news, caught gonzalas caught on tape here..enron scandal..check it out:
http://www.cbsnews.com/stories/2005/02/03/eveningnews/main671618.shtml
Sigh. Naomi Klein = Conflationist.
She uncovers many of the problems with our corporatist/state-capitalist/crony-capitalist economic system and then finds a way to blame it on "free-market capitalism," which has NEVER truly existed.
Do you have any idea what you're talking about? It doesn't look like it. Maybe if you bothered to expand on your claim, it might make some sense?
I think he's talking about theoretical 'free market' capitalism, as opposed to the kind of rigged, crony capitalism which actually exists. The Milton Friedmans of this world, and their admirers, have never been reality based.But trashing Naomi Klein accomplishes nothing.
It appears that our so-called free market anarchist (Bakunin, Proudhon or Emma G. would be rolling in their graves) is CD's latest "libertarian" troll.
His unfettered free market ideas have indeed been tried, as an examination of places like Honduras, E-Salvador, and Nicaragua (Post Sdandinista of course). A reading of the history of the robber-baron era, or Some Sinclair, Steinbeck, or Dickens is also useful.
Nothing excells like pure free markets for rapidly concentrating wealth and power over others in very few hands. The idea that the anarchist ideal of an egalitarian society can exist in the context of "free markets" (or arguably, markets at all) is absurd. The physical reasons for this should be completely obvious.
pjd: I am not trying to be a "troll." (Please see my elaboration above.)
IDEAS PLEASE, NOT INSULTS
Insults, friends, are merely an admission that you lack confidence in your own ideas and arguments. So please, let's not hear anymore about "trolls."
Besides, insults are totally ineffective as political arguments. They may comfort the attacker and the already convinced, but they will NEVER win over those who disagree. And that is the point of political discourse, isn't it?
When people are insulted, or subject to stress, they usually fall back more strongly on their original prejudices. It's like anxious people craving chocolate.
So instead of insults, let's try to sharpen our arguments. You know, think.
Thank you, Laurence
Are you suggesting we "Regulate" how we post in order to have more intelligent discourse?
Only that we each try to regulate ourselves. For the good of the progressive cause. If we allow ourselves to fall into the habit of easy insult we will never win any new converts.
As witnessed by the banking meltdown "Self_regulation" is not regulation at all. It an oxymoron.
If I were to self-regulate my commentary I could as easily claim that insulting inflammatory language is as HELPFUL as is more Civil Discourse.
It then becomes a matter of ones personal and subjective opinion.
Just as an exercise imagine there no speed limits through school zones and people told they could go at any speed THEY themselves deemed safe.
Now imagine in this "self regulated" scenario it was up to each individual to decide what sort of compensation they should pay if they hurt or killed someone due to their excessive speed.
I suggest it would be unworkable.
I suggest you need a system that allows a safe speed limit to be set and a system that punishes those that exceed that limit. I suggest you need a body of laws and courts that allow a trangressor to be fined or sentenced or to defend his side of events.
I suggest the only viable means of doing this is via Government agencies that are seen as independent from the victim and or the perpetrator.
Now this JUST to monitor speed limit through one school zone. Multiply the need of mechansims and regulations in other areas of our life and you WILL end up with your "big Government".
these sociopaths have redefined "free market" capitalism as giving the power of all of society over to the multi-national corporations to do with it as they please. And lo and behold they raise taxes on the poor, take the natural resourses of a country and sell it to the multi-nat corp for a dime on the dollar, get rid of any environmental laws increasing pollution and cancers, resulting in falling average wages, increased debt as a strategy to bankrupt a country so that they have no power to stand up to the corporations.
What a perfect holiday we have tomorrow - halloween! If the corporations, and the USA as it's military arm, aren't a bunch of vampires then I don't know what a vampire is!
'ricardohead' seems to have a much better sense of what I mean. The current economic system is "the kind of rigged, crony capitalism which actually exists." It is not an unhampered free-market, i.e. it is NOT a voluntary economic system due mostly to the existence of interventionist violence by the State. The bailouts last fall are a perfect example. Government, I mean, Goldman Sachs would not exist right now if we had a free market system.
I am not trashing Klein. I called her a conflationist because she conflates. I find her helpful in some ways but horribly misleading in her terminology. Klein does a decent job of uncovering much of the current problems, e.g. the corruption and the ill effects of the current system, etc. but she often uses it to illustrate the bankruptcy of a non-existent "free-market."
In so doing she contributes to the widespread illusion that the U.S. is or ever was a truly "free market" system. This sort of slapdash, undefined, populist rhetoric helps to fuel the closed-mindedness against anyone wishing to argue in favor of voluntary exchanges and peaceful human interactions via the market.
It is a huge reason why progressives and libertarian (pro-market) anarchists like myself tend to talk past one another despite our many levels of agreement. Hopefully, these two amazingly compatible groups can learn to understand each other and integrate their talents and passions to smash the Establishment.
Genuine free markets concentrate wealth, power and privlege in very few hands. The role of government is immaterial. The wealthy first become wealthy through the wealth concentration and labor exploitation power to free markets, THEN they enter into crony relationships with government. The post-soviet economic history of Russia is very illustrative of this.
Like I already wrote, the phyiscal reasons for this are obviious.
The government bailout, while vile, will ultimately be immaterial, the assets of Goldman Sach's would have simply bee re-concentrated on other powerful capitalist's hands.
Aside from the legalization of pot and the like, I see vert little agreement between the left and that peculiar cult-like USAn movement called "libertarianism".
Well, overall I do not agree with your pessimistic assessment of the prospects of a left-libertarian integration. There are many more similarities aside from drug legalization, e.g. dismantling the warfare State, promotion of decentralization, etc.
You state, "Genuine free markets concentrate wealth, power and privlege [sic] in very few hands. The role of government is immaterial...The post-soviet economic history of Russia is very illustrative of this." Being that Soviet Russia is one of the most horrendous examples of centralized State power I have a hard time accepting your example of the "post-soviet" Russian experience as a case where a genuine free market allowed wealth concentration and THEN this wealth concentration used government for its own privileges.
I am glad you illustrate your view of genuine free markets in this way. It perfectly highlights the crucial difference between Leftist and libertarian views on corporatist power. You suffer from what philosopher Roderick Long terms in his essay "Toward a Libertarian Theory of Class" from the 'Plutocracy Only' viewpoint, i.e. that only concentrated wealth is to blame for the unacceptable balance of power in society. You completely disregard the possibility that the monopoly institution of violence, the State, might have something to do with it. "The role of government is immaterial."
Yet, the proper libertarian view points the finger of blame at the State without completely disregarding the culpability of concentrated wealth. Plutocrats certainly play a part in the continuance of our horribly corrupt and immoral economic system. But, the State, by way of its violent crushing of competition, outright subsidies, preferential tax breaks, quasi-monopolistic grants through licensing and permits, artificial distortions such as intellectual property enforcement, among many other things is the primary contributor to the pockets of concentrated wealth which we see today.
The State and the plutocrats reinforce one another. Harnessing State power as a means to control or mitigate the strength of plutocracy is naive and counterproductive. I fail to see how genuine free markets automatically create concentrated wealth. Your assertion that this is simply "obvious" is quite insufficient evidence to say the least. Could you explain why I am to believe this?
As you accuse another of failing to explain a point of view, you yourself fail to explain what you mean by a "free" market. Because of your overreaching condemnation of the role of government in markets, I'll assume that you believe that a "free" market (as though such a thing has ever existed) is a market completely free of government regulation.
Unregulated markets produce monopolies - always have and always will. Monopolies reduce or eliminate competition. Period.
It is the proper role of government to prevent monopolies from developing by limiting the growth and power of corporations, thus maintaining competition.
Practically all of our current economic problems stem from the failure of our government to pursue this role actively.
q
q:
You are actually quite right that a truly unhampered free market would be "a market completely free of government regulation." Excuse me for not being more explicit. I assumed by mentioning I was an anarchist it wouldn't be much of a stretch for a reader to assume... anarchy = no State.
But there is a very important distinction between "unregulated markets" and a market free from GOVERNMENT regulation. Abolishing GOVERNMENT regulation does not equate to abolishing any and all "regulation." A free market anarchist like myself doesn't support "unregulated markets" but instead calls for competition in regulatory agencies. (And as a small side note you still fail to support the claim that a free market, ipso facto, creates concentrated wealth. What theory or empirical evidence can you cite to prove this?)
I completely agree with you on this point: "Monopolies reduce or eliminate competition. Period." Precisely! So, let's get rid of all monopolies, especially the worst monopoly of all, the State, which is a monopoly on the use of violence.
Amazingly, after blasting the concept of monopoly, you go on to say: "It is the proper role of government to prevent monopolies from developing by limiting the growth and power of corporations, thus maintaining competition." But what is government if not a monstrous monopoly?! I fail to see how calling on the worst monopoly of all, the State, to crush other monopolies is somehow going to solve the problem of...monopolies. Could you flesh that one out for me?
Generally speaking, states are not monopolies, though they may at some time monopolize one or another given product or commodity.
(Even states that have tried to monopolize all production have generally failed to do so -- the USSR, as a prime example, died riddled with black market enterprises.)
Even when a government does monopolize a given business, it does not do so in the manner of a corporation. First, to whatever extent the government is representative, ownership of the business is distributed. Corporations, on the other hand, are almost uniformly totalitarian-plutarchic: dollars vote; people do not. Second, even when representation breaks down as usual, government does not need to respond to profit per se. That is, it has at least the opportunity to attempt to cater to its stakeholders. The corporation as it currently exists, by its structure, cannot.
Therefore, to allow a business to monopolize anything more or less guarantees that it will squeeze its victims towards the door of death. Nationalizing something -- what I assume you're calling a government monopoly -- does not guarantee that, though in many cases it does enable it.
The critical differences here all have to do with the power a population has over its government.
.
As to q's comment that free markets lead to monopoly, the classic argument dates from Marx, fleshes out much of CAPITAL, and IMHO remains a worthy read. To oversimplify, having capital grants a business relative advantage. It can hire better people, sell products under cost in one or another area, that kind of thing. Being able to do that allows it to drive competitors out of business.
The disappearance of "Mom and Pop" retail stores from the United States during the latter half of the 20th century is the first example that comes to mind.
..
Now, I have a couple questions, neither rhetorical, because I do see a danger in centralized government.
In what sense can one speak of the state as abolished if a government does not exist to enforce abolition?
You write of "competition in regulatory agencies," something that would of course require regulatory agencies -- agencies that govern, though they seem to be apart from what you call "government." In what sense would these not be government, and how would they govern or regulate?
I'm not who you are posing these questions to but I'll answer them.
There are many examples of self-regulatory institutions today, large and small. Some are partnerships with the government but some are entirely private. One small example would be if you bought a condo in a building with several other condo owners and you made certain agreements about how to take care of the building. Other examples would be certification organizations for various professions, there are many examples and I'm sure you're familiar with them.
The place that dollars can really vote is in the government. When it comes to the free market, we all buy the same amount of toothpaste, beer and toilet paper, so the consumer does vote and it is a purer form of democracy. If the majority of consumers start to favor a new brand of beer, the billionaire has no more vote or influence. As a matter of fact this has happened in recent years with microbreweries. In the government however the rich really have power. Of course, I know the next response will be that we need campaign finance reform but through revolving door appointments, subsidies, lobbyists, it will be a tough battle and it will be a failure because the reform will become corrupted itself. And it will produce more government monopoly as it did in Connecticut by cutting out third party candidates.
"And as a small side note you still fail to support the claim that a free market, ipso facto, creates concentrated wealth. What theory or empirical evidence can you cite to prove this?"
The claim is quite easily supported by historical (i.e. empirical) evidence. The rise of corporate power between the Civil War and the end of the nineteenth century - under a truly corrupt and incompetent government controlled completely by big business - produced the objects of Theodore Roosevelt's "trust busting."Even a moderate amount of study will acquaint an honest scholar with the horrible inequalities of the period which kept labor prices so low that such monstrosities as the Biltmore in Asheville, NC, could be built by the wealth accumulated by one tyrant. America suffered under the belief that it was acceptable to treat other people as unkindly as possible as long as one got rich doing it (today, we call this idea "Friedmanism" or "Reaganism").
I don't see anyone writing about using the state to crush anything. I clearly stated that it is the duty of the state to prevent monopolies from developing. Breaking a business up into smaller entities actaully creates more and not fewer business opportunities, not to mention greater participation in the market by more people.
The state is not a monopoly. It is the peoples' referee in the game of commerce. The referee that we currently have has forgotten who it's working for.
It's so strange how republicans and their drones have everyone convinced that they're pro-market when all republican policies constrict commercial activity for the benefit of a few.
q
Powerful centralized governments and excessive regulation create monopolies. They did in the age of the robber barons and they do today. Microsoft would be a perfect recent example. In a true free market without copyright laws, Microsoft would have had to compete through constantly improving their product, instead they competed through ruthessly exploiting the law to their advantage. In this case, it is monopoly created by govt regulation vs. open source freeware. Since you and Naomi Klein are so much in favor of govt intervention into people's lives and work, am I to assume you are opposed the copyleft movement and open source community as well as a free market, that you think a free and open exchange of ideas and technological advances should be outlawed and controlled by the government in the same way you think trade should be and exchange of goods and money? I assume you are opposed to communities that have created their own money to use instead of the federal government's in an effort to encourage local economies? And you agree the government should raid and arrest these people like they did the founders of the liberty dollar? So should they be arresting and raiding the homes of Linux users? I'm just wondering since you are so much in favor of authoritarian state power and think it is necessary to protect humanity and that freedom is so dangerous and does so much harm, how else do you think this repressive government power should be applied? Maybe there is a danger of some ideas becoming too powerful in the open source community and the politicians need to take away our rights to exchange ideas as well as goods? What do you think? How much do we need to repress individual freedoms to make the world a better place in your opinion?
"Powerful centralized governments and excessive regulation create monopolies. They did in the age of the robber barons and they do today."
Your sentence would be true if it were rewritten to say "Corrupt powerful centralized governments . . . ."
Monopolies will develop under no regulation or corrupt regulation - they're really the same thing.
And copyright laws are good things as long as they don't remain in effect for too long.
Your suppositions are so baseless that they aren't worth wasting time.
You argue like a bad high school debater, using one invalid rhetorical scheme after another: appeal to emotion, faulty inference, and "dumping" just to name a few.
q
You're right, it was rhetorical so you don't need to answer them. My point was that individual freedom is a good thing and that authoritarian government is not, and my rhetorical questions were just a list of examples.
Well, that answer is what people always say, that of course the government is bad if corrupted so we just need to make it uncorrupted. I disagree. I think our country was founded on the principle that government is by its very nature a threat to individual freedom and can easily lead to tyranny and corruption, and in the same way to monopolies, if unchecked. It is not possible to have an excessively powerful authoritarian state and the greatest individual freedom at the same time. It cannot be done. The only solution is to keep the power of the state to what is needed which is much less than now.
The libertarian argument seems to hinge on this proposition that the state has a monopoly on violence. Well, haven't any of you ever heard of the Pinkertons? They were violence employed against workers directly by the private holders of concentrated wealth.
Absent this so-called government monopoly of power, it would be a simple matter for the wealthy and powerful to purchase their violence from private sources.
I hate having to explain something so obvious but "free markets" concentrate power for the following reasons:
1. Any initial incremental increase in wealth give one side more power in any bargaining position. The wealthier side can bide their time, the poor side must accept the wealthier sides terms of the transaction or starve.
2. As the wealthy get more wealthy, their bargaining position, become even more powerful and coercive...
3. Which allow the wealthy to accumulate wealth at an ever accelerating rate.
4. ultimately resulting in the wealth and power over others getting concentrated in very few hands.
Marx came up with a scientific explanation of what the state is, how it came about and what its role is. Simply put, the state is a coercive force designed to protect the class interests of the particular class that holds hegemony in a society and to protect and maintain the particular class relationships that exist. A state will be necessary as long as the system contains classes. The state can only cease to be necessary and to exist when a classless society is achieved. Marxism is the only revolutionary movement that sees its role as moving society to its next and higher stage where surplus value is appropriated by society as a whole rather than a particular class and in so doing, allow the state to wither away, as it will no longer be necessary.
It's hard to not conflate "free market" ideas when no adequately consistent definition of them exists.
If one attempts to take the term literally as the sum of its parts, "free-market capitalism" cannot exist:
------ "Market" implies sale.
------ Sale implies property.
------ Property implies exclusion.
------ Exclusion requires coercion
------ One who coerces governs, regardless of whether that agent is nominally government.
Let us not be surprised, then, that the majority of those who plead for "free market" also plead for increased governmental violence and control.
- - - - That does NOT apply to all of you, I realize! - - - -
So, clearly, we cannot take the term literally. One may proceed to leading exponents. Since we're talking about Naomi Klein and she primarily cites Milton Friedman, I'll go there.
Friedman is no anarchist, no Proudhon or Bakunin or Rocker. Friedman argues for untrammelled corporate freedom within a state that restricts individuals, at least in that they must respect property.
I realize that Friedman saw Nixon as a traitor and was not thrilled with Reagan either, and that another "free market" exponent might disapprove of Friedman as well. And maybe IMF, World Bank, and US economy chiefs are not true believers despite their claims.
Friedman did not approve of large-scale government military spending, but one may see clearly how it gets occasioned in practice by his ideas:
-- Free corporation A invests in oil in country B.
-- B nationalizes A's resources in B.
-- Free corporation A freely pays C to take back what B has claimed.
Now, I see no special reason that entity C should not be a government instead of a mercenary force.
.
Klein does go into this, more gracefully and at greater length. I believe it's somewhere in the first 3rd of THE SHOCK DOCTRINE.
Naomi Klein has uncovered the inner working of the core corruption of our strain of capitalism. She has shown how the ruling elite have strategically and systematically been destroying the middle class,working class and the poor. I would say it is class war and the ruling elite are ones forcing every ones hands in the air while they fill there trophy rooms with the cash of an entire nation. No remorse. No guilt. No shame.
They invented an simple machine in France years and years ago that swiftly remedied the mality of a class of people that destroyed a nation.
Not saying that is was a success mind you or even a thoughtful venture. But would love to some type of revolution against this murderous greed. Some type of awakening. I think Naomi Kleins connected dots shine a scorching light on the shadowy figures and blue prints that are taking our lives and the future lives of us all. All of man kind.
it is not only a class war, but most of all, a war due to effective and increasing operational scarcity where the winners win big and the losers are allowed to die!...see: http://www.counterpunch.org/smecker10282009.html for the origin of all of this...
The most truly stupid thing California voters did a long time ago which is slowly killing the State is voting for Proposition 13 back in 1978. The only proper source of revenue to pay for local and state services (physical infrastructure in particular) is to assess against the economic value that those expenditures engender. All public expenditure and most obviously in the case of expenditures for physical infrastructure results in increasing land values. They do not increase the value of improvements but land value only. All economists agree.
The appropriate source of revenue to pay for public services, therefore, is to assess against the privately held values public expenditures produce and increase. That value is land value. The property tax is the only tax that directly taxes land value. In that regard, the property tax merely takes back for community use to pay for community provided services the value the community gives to land. This is the epitome of economic justice. Unfortunately the property tax is deeply flawed in that it also taxes the value of improvements the value of which is not increased by public services. But compared to every other tax that by definition has to fall on labor and capital, the property tax even as flawed as it was/is contains the only just and economically neutral form of taxation there is; the tax on community created land value.
When the good people of California voted to cap the property tax back in 1978, they started a process that was guaranteed to eat the economic heart out of the state first by encouraging real estate speculation, i.e. land speculation, since the holding cost of real estate was significantly reduced and second by forcing all other taxation to fall on earned incomes from labor and real capital investment.
The two sides are now in total confrontational deadlock. The folks on the right now take the position that all taxation and all government is bad and is to be opposed. They are absolutely correct in regard to taxation of labor and capital but they are absolutely dead wrong when it comes to taxation of land value. You have to understand that private ownership of community created land value is a total free gift and free lunch from the community that benefits all land owners and is totally at the expense of all non-landowners, labor and capital. Landowners who also receive income from labor and real capital investment would prefer to have their labor and capital taxed as long as it protected the free lunch of their unearned land values. What else do you think the run up of real estate/home values was all about? It was all about cashing in on the speculative increase of land values and now that bubble has burst once again and it has triggered the far greater collapse of the entire financial house of cards that used real estate/land speculation as its foundation Now that is what was really stupid.
What the folks on the right do not understand is that failure of government to continue spending on public services and infrastructure in particular will inevitably result in destroying the value of their land. They will have fought so hard to protect the free lunch that they will have destroyed its source. This means that even the recipients of the free lunch do not truly understand what they have and where it comes from.
On the other hand the folks on the left have no clue about this either since they truly really never did and never will, it seems, understand the most simple principles of economics. The left does not understand that it has completely ignored and left off the table the most powerful argument for economic justice there is. They have utterly failed to understand that community created land value belongs 100% to the community and that there is no valid argument that can be made against the idea. On the other hand they do not acknowledge the truth of the right's argument that taxes on labor and capital are destructive because they destroy incentives and skew economic decision making. The most powerful thing the left could have ever done was to agree with the right on most of their rant against taxes on labor and capital but ferociously insist on very heavy taxation of community created land value.
My guess is that the left has failed to do this partly out of ignorance but also partly out of desire to cash in on community created land values themselves. Do you know any lefties who got burned in the housing bubble? I sure do. With the collapse of the speculative value of real estate which is wholly the collapse of the speculative value of land, perhaps the left will realize the opportunity they now have to make the most powerful argument regarding taxation there is.
I'm not holding my breath since most folks on the left seem to want government to shore up the real estate market. The ostensible purpose is to help homeowners stay in their homes but the underlying agenda is to stop the further deterioration of land values so that the speculation in unearned land values can begin all over again. Is it not so? Is anyone prepared to give up profiting or the hope of profiting from speculation in values they do not create?
The solution would be to slowly return to the property tax by first changing it to a land value tax only by increasing the tax on land values and reducing it on improvements. Then the land value tax could be increased to take back more and more community created land value while reducing other taxes that fall on labor and capital. My preference would be to eliminate the state income tax on wages from the bottom up and then to eliminate the destructive regressive sales tax.
Wow. Well put and educational. You're right, I don't understand all the ins n outs of tax policy. I do note that our troubles seemed to begin with Reagan's cutting of taxes and resultant ballooning the national debt, but CA's problems are certainly of a different nature and even I understand their troubles began with Prop 13.
I agree with your analysis, but to get to your proposed solutions, Prop 13 must first be overthrown, which is a VERY big nut-to-crack. I rather doubt Californnians have the political maturity or knowledge to agree that this is THE first step that MUST be taken, for as you point-out failure of the public infrastructure and community supports will result in declining property values that won't care whether one is left or right. But I won't hold my breath waiting for the media to broadcast the message that Prop 13 is destroying property values, provided some politician is smart/brave enough.
You know the state, I'm afraid. CA sports a very slim blue-green skin on a very red state.
I agree that taxing land at a high and frequently adjusted rate, and buildings on the land at a low rate is a good idea. Pittsburgh did this until a few years ago, and they survived the rust-belt collapse much better than other comparable cities. They stopped doing this (forced by the state) and then they started having service and budget difficulties.
However, RE taxes can be as regressive as sales taxes - so a generous homestead exception is also needed.
I do disagree with doing away with income taxes, although they should be steeply progressive, and the regressive flat "payroll taxes" used by many local governments here in PA should at least be extended to investment income.
Jim, are you talking about just California or everywhere? I am a landowner out here in rural Ohio, and I provide my own water and water purification, my own septic/sewer, and I use the land to grow food and wood for heat. We have no local police but do have the county sheriff and the state police. My library has cut its hours back drastically. Only two days a week are they open past two in the afternoon, and they're completely closed on the weekend. The school has no football team. I don't see where I'm getting some monstrous benefit out of being a landowner.
I can tell you've done a lot of thinking on this but maybe you are overcomplicating it.
Find out who's got the money, cuz it sure ain't me, and tax THEM.
Not all libraries are supported by property taxes, as this year's election in Oregon reveals. I can remember needing to purchase a library card and pay for its renewal annually because where I lived didn't send any tax monies to support it. So, if you lived in X part of the county, you had to buy a card, while people living in Y part of the county didn't. This can extend to other things too. Neighboring fire districts can have very different levels of equipment and manpower because one district chooses to fund their department while the other doesn't, and the effects are seen in differing insurance costs and fire supression.
My property tax statement itemizes (generally) where every cent I pay goes. This year's sole ballot item for my disrtict is to determine if we will up the property tax a couple of cents per $1000 assessed value to continue to fund our county's animal shelter and animal control officers, which is in my interest to do, so I voted yes. But the monies cannot be used for any other purpose. Here, people are very active politically; I cannot say the same for California during the many years I lived there. Oh sure, there were moments, but staying active during the long, slow grind is what's required and few (on the middle and left) really seem to understand that.
jim, excellent but the dumbells among us would enjoy a further elucidation of the macro bemefits of your tax proposals. Are you im public office? Wish you were...
tax the rich....the answer is easy....reinstate the 93% tax rate the Eisenhower Admin had on the wealthy. Any wage over 3 million a year gets a 93% tax rate........
and if the rich don't like it - let them leave the USA. They are a cancer on this country - the sooner we understand that and begin to fight back the better.
Besides the ultra-wealthy pay a lower tax rate than the rest of us while using more of the COMMONS - add to that the fact that they CREATE NOTHING OF VALUE makes them a bunch of FREELOADERS.
We live in a nation of FREELOADERS and sociopaths in the upper crust of society - until we come to our senses and realize that it will only get worse - as the economy in the USA falls even further the wealthy will fight more and more to hold on to their ill-gotten gains at the expense of our environment, the economy, the middle class and working poor, our health, civil stabilty, etc etc tec.....
THE RICH DON'T CARE!
Tax them and let's hope they leave. I hear the UAE is quite nice this time of year!
I read that due to proposition 13, the wealthiest CA residents pay lower total taxes than the middle class, since their wealth is tied up in property.
The same proposition created a 2/3rds vote in the CA legislature: you can't pass a budget or raise taxes without a 2/3rds majority in the CA legislature. Basically, it is saying that one GOP vote is worth two DNC votes. No wonder CA can only apply tax cuts to its budgetary situation: IT DOESN'T HAVE A DEMOCRACY!!!
Good point. For that matter the USA does not have a democracy. The elecoral system is rigged, the institutions are rigged; the game is clearly rigged to give the appearance of choice while the ruling classes determine the outcomes with impunity.
True dat, but frankly I've never seen anything quite as explicitly anti-democratic as California's 2/3rd's rule. When you think about it, pretty much ALL a government does is tax people and spend those taxes on common services. The debate in governance is thus PRIMARILY a debate about tax levels and gov't service levels.
What CA has done is say 'what debate? what democracy?' So people can talk all they want. They can perform study after study after study. But, at the end of the day 33% of CA will stand together and prevent what the other 66% want: tax increases.
Its amazing to me that anyone can call that a democracy. The debate over tax levels is really the ONLY debate in politics. CA trashed its democracy for 'something else', and this is the result. A neo-aristocracy riding high over the whipped-masses below. And being granted an extra vote per person 'just because'.
I was born and lived a large percentage of my life in central California, and the fundamental reason I no longer live there is Prop 13. After the contrived energy "crisis" that led to Davis's recall, the rise of the Governator and the 2002 budget Crisis that resulted in the pink-slipping of all us part-time college instructors (along with thousands of others), it became clear that Californians would never overthrow Prop 13--the fundamental instrument causing California's financial implosion. So, we sold the house well before the market crashed and moved to a much saner state, one far more community/people oriented. Family members I was unable to convince to move at that time now rue their choice as they find themselves stuck. California's 2010 election is going to be something to watch.
interesting. ie the freeloader part
93% is a good start, but I propose a further step. Anyone making over one million dollars a year should be taxed at 110%. No one is worth more than a million dollars a year. I don't care what they do for an occupation.
I agree with your solution that we "MUST" tax the rich more. I though, favor the tax rates under Kennedy, 70% on income above a million dollars. Those were good times for this country. Everyone made out just fine including the rich. This issue has to be discussed by the POLS or we as a nation are going down to a third World, feudalist status although we will be armed with Nukes. Not pretty.
Your solution is very humanitarian. I'd just chop off their heads and take the wealth they've stolen.
I wonder how Ahnode feels now about the idea that government should "step back" from the free market. I'm just wondering why I didn't hear about him vocally opposing the TARP bailout.
Naomi highlights what those paying attention have known for awhile now. The reason we have a Nazi-sympathizing, brainless tool, Neanderthal, B-movie actor goofball in the first place is that private interests with huge sums of money put him there. This aint democracy folks it is Democracy(TM), a public relations stunt. The corrupt and rigged democratic process in this country makes it all too easy to install someone who sounds like General Burkhalter on an old Hogan's Heroes re-run.
The Governator lied and said he would get back the 12-20 billion dollars extorted from the California taxpayer by Enron, Duke, Reliant etc. Of course this was forgotten almost immediately. One of the wealthiest places on the planet has the worst public schools in the entire developed world. That alone should bring people into the streets baying for his and others blood.
It has happened before (Ronald Raygun) and it will happen again.
And that's why I've boycotted California. I'll spend my money close to home. Haven't been there since 2002 and it looks like I won't return anytime soon.
Awww....my feelings are hurt. Why do you hate us Californians so much? After all, we are on the ”left” coast. We are not stuck in the middle of the country all scaredified of little brown and black faces and a woman’s right to “choose”. It is a proven fact that in the middle of the country and on the “right” side of the isle of Congress that peckers are smaller on average…thus producing the mean and nasty occupants that run some of our country.
Actually, Der Governator was put in office specifically to stop the lawsuit the Davis administration had initiated to recover the billions stolen from Californians by Enron et al. The story is covered by Greg Palast in one of his books (either "The Best Democracy Money Can Buy," or "Armed Madhouse." It's been a while since I read it.)