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Post by unlawflcombatnt on Nov 19, 2011 14:12:38 GMT -6
from Ritholtz.com blog via Patrick.net The US is now a Corporate MonarchyNov 17, 2011 by Barry Ritholtz " I did an interview with a print reporter yesterday about what has been going on with lack of prosecutions, the banks, and Wall Street in general. We discussed the corrupt exchanges and HFT.
I dropped lots of F-Bombs, called out cowards and crooks and held nothing back. (“That fucker belongs in prison; this son of a bitch should hang“)
Afterwards, she commented that I seemed angry.
I wrote back suggesting that I am a happy dude, and its not Anger — its closer to an ineffable sadness that comes once you realize you have lost something dear. I am old enough to have grown up when this nation was a Democracy, but that era has passed. We now live in a nation no longer run by the citizens — it is a Corporatocracy — and that makes me sadder than angry . . .
She suggests perhaps a better word is outraged.
I wonder: Why have the Europeans figured out they are getting screwed, and we haven’t? Why are they taking to the streets en masse, while we seem to be watching our own control over our own futures slip from our hands almost as if from afar?
In America, we are too busy dropping the kids off at soccer, running around looking for sales and bargains, racing to keep our heads above water. We seem to forget to get outraged. Our control over our once Democracy — the one we had a revolution against a monarchy dictating decisions from afar — slips away from us. Not with a bang, not even with a whimper, but with a 1000s acts of gradual ceding of power to the new Monarch. We have given up hard won rights to a coordinated attack from all three branches of government; Our Congress has become the legislative branch of eBay — Congressmen are auctioned off to the highest bidder; they even have a Buy It Now button to get specific legislation passed. The executive branch has fallen under the sunk cost fallacy, afraid to prosecute banks because we spent so many billions bailing them out. It turns out that even our once venerable Supreme Court is just as corrupted, with lobbyists partying with Justices and backdooring ethics by hiring their wives.
In short, our new overlords are enormously well funded, well connected, relentless and perhaps most of all, patient. This new King was not appointed by primogeniture, or even Divine Right, but by acquiring enough profits in the free market that they can buy control over society, even as they thwart that free market ideal for their own ends. We have become, in short, a Corporate Monarchy.
The right question isn’t why am I angry, sad and outraged. The proper question is, why aren’t you."
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Post by jeffolie on Nov 20, 2011 8:05:11 GMT -6
Politics matters. Little watched politics include corporation funding JUDGES CAMPAIGNS. Moreso than ever corporations get RIGHTS EQUAL TO HUMANS, deflected bad publicity for wrong doing by sidetracking potential lawsuits with public exposure into mandatory arbitration, fine print and little read and even less understood TERMS OF AGREEMENTS that screw buyers/borrowers/clients out of fair & reasonable treatment; all because the now CORPORATE SPONSORED POLITICAL CAMPAIGNS FOR JUDGES.
How are judges today increasing the corporate power, corruption of humans:
"... The Supreme Court's 2010 ruling that affirmed "corporate personhood" — the idea that companies ought to be entitled to basic human rights — broadened their ability to directly contribute to candidates for public office.
"... In short, unlike average people, businesses now have an even greater chance of buying the laws, regulations and tax loopholes that they want.
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Corporate power grows stronger as government wanes
In the dreams of the Occupy Wall Street movement, America will look like a very different place five years from now.
The power and influence of corporations will be sharply curbed, good jobs will be plentiful and income disparities will have narrowed significantly.
Tom Petruno Tom Petruno is the markets columnist for [Los Angeles]The Times. His column is aimed at the individual investor and covers a broad area of personal finance and investing topics. He joined [Los Angeles]The Times in January 1990 from USA Today in Washington, D.C., where he directed the national newspaper's markets coverage for five years. As deputy managing editor for markets in USA Today's Money Section he also had overall responsibility for the section's news content. At the [Los Angeles]The Times he directed the newspaper's markets coverage from 1995 to 2001.
Now imagine another scenario, the "Rollerball" scenario, from the 1975 movie of that name: Corporations have replaced national governments and effectively control the world. There are no more wars, but people surrender their humanity to the primacy of the corporation.
"Rollerball" still seems pretty far-fetched, but the occupiers are right to ring the alarm about the trend. In the aftermath of the 2008 market and economic crash, the financial and political power of major companies has only increased while workers' power has faded amid a global labor glut.
What's more, corporations grow stronger while developed-world governments are badly weakened — in no small part because of the heavier debt burdens they've taken on to try to save their economies with stimulus spending, bank bailouts and payments to the unemployed.
In August, the U.S. for the first time lost its top-rung AAA credit grade from Standard & Poor's, which cut the nation's rating to AA+, citing ballooning debt.
No such downgrade has befallen Exxon Mobil Corp., which remains AAA in S&P's eyes.
Europe's debt crisis is all about governments being too deep in hock, of course. For the moment, that crisis is overshadowing what remains a dire situation for Washington and for many state governments.
Congress' special "super committee" of legislators faces a Wednesday deadline to suggest at least $1.5 trillion in deficit reduction over the next 10 years.
But even if they meet that goal, the debt will continue to grow. The U.S. ran a deficit of $1.3 trillion in the last fiscal year alone.
California is staring into its own abyss: With tax revenue running well below projections, the state faces the prospect of further deep spending cuts for education, child-care programs and other social services in 2012.
Meanwhile, dollars pile up in corporate coffers. The blue-chip companies in the S&P 500 index are sitting on a record $1 trillion in cash now, according to S&P. That's up from $647 billion just before the 2008 economic and financial crash.
Clearly, despite the global economy's disappointing growth over the last three years, multinational firms overall have prospered. Operating earnings of the S&P companies are estimated to have reached $231 billion in the third quarter, a new all-time high. Per-share earnings were up 13% from a year earlier.
"We have an economy that works for corporate America even if it doesn't work for anybody else," said Lawrence Mishel, head of the left-leaning Economic Policy Institute in Washington.
After slashing jobs during the recession, even modest increases in sales have translated into fat profits for many companies. Also, far-flung U.S. multinational firms have been able to cash in on stronger economic growth in developing nations, such as China and Brazil, even as domestic growth has remained tepid at best.
Businesses also have benefited directly and indirectly from governments' deficit spending. Those dollars have funded infrastructure projects, for example, and paid jobless benefits, food stamps and other support to the 14 million unemployed Americans, who then consume what companies produce.
"Companies depend on governments for all sorts of things," notes Dean Baker, co-director of the Center for Economic & Policy Research in Washington.
The corporate sector also has been a key beneficiary of the Federal Reserve's efforts to keep long-term interest rates depressed. That has allowed companies to refinance debt at lower rates, further bolstering their finances.
Deeply indebted homeowners with no equity in their houses aren't so lucky.
As corporate earnings have recovered to new highs, pressure has mounted on businesses to explain why hiring has been slow to follow. Yet many companies say that demand for goods and services overall has remained too weak to justify a hiring binge.
"Companies will start to spend their cash when they can't meet demand" with existing staff, said Martin Regalia, chief economist at the U.S. Chamber of Commerce in Washington. "They can't just turn around and increase the revenue spigot when they want to."
Businesses also justify their caution by pointing to the severity of the 2007-09 recession, and legitimate fears that the economy could stumble again. Europe may already be back in recession.
Still, if money is power, corporate America has it. That cash can be used to reward shareholders with bigger dividends, an idea that more companies have embraced this year. That puts profit back into the economy.
But corporations also can spend their money to influence the policies of the severely stressed governments that regulate them.
No one needs an explanation of the power of corporate lobbies in Washington. The Supreme Court's 2010 ruling that affirmed "corporate personhood" — the idea that companies ought to be entitled to basic human rights — broadened their ability to directly contribute to candidates for public office.
In short, unlike average people, businesses now have an even greater chance of buying the laws, regulations and tax loopholes that they want.
Barry Ritholtz, a New York money manager, wonders why Americans aren't more upset about all of this. He used his blog this week to declare that the U.S. has become a "Corporate Monarchy."
"Our new overlords are enormously well-funded, well-connected, relentless and perhaps most of all, patient," Ritholtz said.
Is that over the top?
If the stock market were convinced that we're entering a new era of business supremacy, you might assume that share prices would be reflecting it. Yet the S&P 500 index is down 3.3% this year even as corporate earnings have continued to rise.
Investors may be wary because they know that governments still have one authority that companies don't: the ability to tax.
But with economies starved for jobs, and labor in surplus, companies worldwide are likely to find it easier to fend off any threat of higher taxes, which they'll argue could further inhibit private-sector job creation.
Mishel, at the Economic Policy Institute, sees little likelihood that the shift of power toward business and away from government and workers will reverse anytime soon.
Corporations know, he said, that "this economy is not going to weaken their hand."
tom.petruno@latimes.com
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