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Thread: The Real Villain Behind Our New Gilded Age

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    Cat-tastic Babba's Avatar
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    The Real Villain Behind Our New Gilded Age

    This opinion piece is spot on. We have forgotten the lessons of the early 20th century and the people have been convinced by the elite that those lessons don't apply today. But they're constant truths that apply at all times.

    In the past two decades, growth rates in the United States have fallen to half of what they were in the middle of the 20th century. The share of income accruing to the top 1 percent has nearly doubled since the 1970s, while the share of income going to all workers has fallen by nearly 10 percent.

    These are the marks of our new Gilded Age. It’s tempting to blame impersonal market forces such as globalization and automation for widening inequality. But the true villain would be familiar to anyone who lived through the previous one: market (that is, monopoly) power.
    Today, market power takes new forms, but the solution is the same: antimonopoly laws and laws protecting workers, but updated for the problems of the 21st century.

    The era of “supply-side economics” championed by Ronald Reagan and Margaret Thatcher — which called for tax cuts, deregulation and narrow antitrust enforcement — explains a lot of our current predicament. The key assumption of that era was that markets work best when the government focuses exclusively on enforcing contract and property rights.

    This theory turned out to be wrong — not because it celebrates the market but because it misunderstands it. Two centuries earlier, Adam Smith pointed out that the easiest way for businesses to earn profits is not by slashing costs and innovating but by agreeing among themselves not to compete — to exert market power to raise prices or lower wages.
    https://www.nytimes.com/2018/05/01/o...ilded-age.html

    How can anyone doubt that it goes a long way toward explaining why worker's wages have stagnated and corporate profits have skyrocketed. Teddy Roosevelt was right.
    Last edited by Babba; 2nd May 2018 at 01:42 PM.
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    Southern Strategy Liberal OldGaffer's Avatar
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    Adam Smith pointed out that the easiest way for businesses to earn profits is not by slashing costs and innovating but by agreeing among themselves not to compete — to exert market power to raise prices or lower wages.
    Every right winger just knows that Adam Smith was a commie....
    Last edited by OldGaffer; 7th May 2018 at 07:02 AM.
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    Radical Centrist BigLeRoy's Avatar
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    Quote Originally Posted by OldGaffer View Post
    Every right winger just knows that Adam smith was a commie....
    You know, people should actually READ the guy, instead of just talking about him all the time. Might open some eyes. Might open some minds, which need opening even more than eyes do.

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    Southern Strategy Liberal OldGaffer's Avatar
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    Quote Originally Posted by BigLeRoy View Post
    You know, people should actually READ the guy, instead of just talking about him all the time. Might open some eyes. Might open some minds, which need opening even more than eyes do.
    The first requirement for membership in #Trumpcult is a closed mind.

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    Veteran Member Moorhuhn Wanted Champion Hollywood's Avatar
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    Quote Originally Posted by BigLeRoy View Post
    You know, people should actually READ the guy, instead of just talking about him all the time. Might open some eyes. Might open some minds, which need opening even more than eyes do.
    Kinda' funny that just a few years ago Adam Smith's Wealth Of Nations was practically the RW Conservative's Bible, until Ayn Rand 's Atlas Shrugged became fashionable with them.

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    Quote Originally Posted by BigLeRoy View Post
    You know, people should actually READ the guy, instead of just talking about him all the time. Might open some eyes. Might open some minds, which need opening even more than eyes do.
    Smith speaks to a lot of issues in ways modern conservatives wouldn't countenance. Smith would laugh at the "build a wall" idea. Something about "India rubber"....
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    Radical Centrist BigLeRoy's Avatar
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    Quote Originally Posted by Hollywood View Post
    Kinda' funny that just a few years ago Adam Smith's Wealth Of Nations was practically the RW Conservative's Bible, until Ayn Rand 's Atlas Shrugged became fashionable with them.
    Ayn Rand was a fifth-rate philosopher, at best. Adam Smith was a world-class philosopher, with a keen understanding of human nature.

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    Quote Originally Posted by Babba View Post
    This opinion piece is spot on. We have forgotten the lessons of the early 20th century and the people have been convinced by the elite that those lessons don't apply today. But they're constant truths that apply at all times.





    https://www.nytimes.com/2018/05/01/o...ilded-age.html

    How can anyone doubt that it goes a long way toward explaining why worker's wages have stagnated and corporate profits have skyrocketed. Teddy Roosevelt was right.
    So where's the collusion. Essentially you're suggesting that employers are colluding to bolster their profits by agreeing to underpay workers.

    "Two centuries earlier, Adam Smith pointed out that the easiest way for businesses to earn profits is not by slashing costs and innovating but by agreeing among themselves not to compete — to exert market power to raise prices or lower wages."

    And let's take a look at the poster child for Golded Age trusts - John D Rockefeller's Standard Oil. And there's no question with the Southern Improvement Company that he attempted to essentially make a cartel. See the response to that. After that of course he started vertically integrated and he became a very large concern. What's interesting though is that by the time he was ordered to divest his market share had fallen, there were hundreds of refineries competing against him. And interesting the price of kerosene had fallen dramatically.
    Last edited by publius3; 2nd May 2018 at 07:00 PM.

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    Veteran Member Puzzling Evidence's Avatar
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    Quote Originally Posted by publius3 View Post
    So where's the collusion. Essentially you're suggesting that employers are colluding to bolster their profits by agreeing to underpay workers.
    You seriously don't think that there is a vested interest in corporations "buying" elections?
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    Quote Originally Posted by OldGaffer View Post
    Every right winger just knows that Adam smith was a commie....
    Not really. They selectively read Adam Smith to support their agenda.

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