Elaine was wondering about the puff of steam she saw receding towards Colorado Springs and the bunch of anoraks that were hanging out at our RR crossing as she returned from the store.
I will try to get by the rail yard tomorrow and see the engine up close.
OWS’s Beef: Wall Street Isn’t Winning It’s Cheating | Matt Taibbi | Rolling Stone.
Matt Taibbi has an excellent rant on a big why behind Wall Street.
…we hate the rich? Come on. Success is the national religion, and almost everyone is a believer. Americans love winners. But that’s just the problem. These guys on Wall Street are not winning – they’re cheating. And as much as we love the self-made success story, we hate the cheater that much more.
We cheer for people who hit their own home runs in this country– not shortcut-chasing juicers like Bonds and McGwire, Blankfein and Dimon.
If you have an underwater mortgage, say $120,000 mortgage on a house that is assessed at $80,000, and you are making the mortgage payments on schedule, and you ask the bank to refinance to a lower rate and the bank can’t do that because you are asking to finance a loan that is greater than the collateral, does this make sense? You’re still willing to make the payments on the $120,000 amount but you would like to pay at today’s interest rates.
Why can’t the bank work with you on this? The fiscally responsible action is for you to walk away from the loan, leaving the house and the debt in the bank’s hands. This is what all those Wall Street entrepreneurs would do. Of course it isn’t the ethical thing to do, but what do ethics have to do with fiscal responsibility?
I would like to propose a few taxing proposals.
First is to take federal social insurance (Social Security, Medicare and Medicaid) off the books and let them be funded by a straight 20% payroll tax. Those payroll taxes go straight through to the trust funds and don’t go through the Congress. Congress can oversee the Trustees. I would also suggest that Medicare/Medicaid will provide universal coverage.
Let’s get rid of the itemized deductions, give every household a flat deduction of $75,000, calculate the non-social insurance expenses for the government and figure out how much revenue we need to collect to cover the difference. Then calculate what we need to tax everyone to meet our goals.
As an example: We have $13T income in the US. With the 20% payroll tax the Social Insurance Funds are collecting $5.2T (employer matching). That should cover the annual medical costs and retirement funding with no problem.We have ~$9T in flat deductions, leaving about $4T to cover the federal budget. Taking the Social Insurance costs out of the picture we have about $2T to cover. So a 50% tax on everyone’s income over $75,000 will cover the budget with no deficit. And the Corporations don’t have to pay any taxes!
Or we could arrange for the personal income tax to cover 3/4 of the budget and Corporations to cover 1/4 of the budget. Then we have $0.5T coming from Corps and $1.5T coming from the people with a 37.5% tax rate.
I am sure there are some tweaks that need to be accounted for. What about folks whose income doesn’t come from payrolls? They need to contribute to the Social Insurance funds. And what about 1 person households and 2 person households and 10 person households, etc? Do they all get the same $75,00 deduction? Some more pondering is needed.
I heard an interview of Roger Martin the other day on Business Daily and he pointed out that the idea that companies are in business in maximize the shareholders short-term profit is just because someone said so. There is no reason that this should be the driving goal of capitalistic businesses.
I suppose that over the years the idea of short-term profits has become the loudest voice in the room.What if we changed that to reward 10-year growth? A company’s executives and board put together long-term goals and drive the company in that direction and they are rewarded for reaching those goals – in 10 years. Bonuses will be paid to you or your estate whether you are still with the company. And if the 10-years goals are set every year, potential investors can see how well the management is doing and decide if they want to invest or invest more. There are no extraordinary bonuses based on past year’s performance or non-performance. Profits/dividends can still be distributed annually, but the focus on performance is long-term.
It will require a paradigm shift to get away from immediate gratification ( I hate using that term but I think it actually works here.) I can’t imagine the current crop of business managers will move willingly in this direction. So much easier to game the system in the short-term. I don’t know how we could go about introducing this as a common business practice. Possibly use the SEC to reward the long-term planners? Disincorporate companies that don’t line up? Talk to the states that incorporate companies and get them to change their rules?
Whatever, let’s put it on the table. I’m sure there are a lot of considerations to include. Maybe 7-year planning rather than ten (let’s not go to 5-year planning).
I was thinking about my idea of setting up the House of Representatives to have one representative per 100 000 citizens. While that would increase the House from 435 to ~3100 right now, it would leave the Senate at 100, 2 Senators per State.
Let’s also increase the Senate to have 6 Senators per state. The Senators continue to serve 6 year terms and they continue to be elected on their current schedule. But three Senators would be elected in each election and the three top vote-getters would get the office. So the result will end up with each state probably having a Republican, a Democrat and a Third Party type – or a second Rep. or Dem. depending on the vote totals. I think this would give popular 3rd party candidates a chance to be heard on the national stage as well as providing a moderating influence on the two-party duocracy we have today.
Graham Hill: Less stuff, more happiness | Video on TED.com.
An intriguing talk. If I lived in a dense urban area I might consider the editing he talks about. My main problem is that I don’t want to put my books into digital format.The second problem is that you can’t fit two people into his space. That will need some extreme editing.
I wonder how he gets that coffee table to seat 10 for dining? I think I found the link. Its not a coffee table.
Transforming Tables: Convert Coffee to Dining Surfaces | Designs & Ideas on Dornob.
Some neat ideas here.
I was recently reminded of what I consider to be the most heartbreaking moments in sports – Tom Watson’s 277th stroke in the 2009 Open Championship.
And one for the greatest comebacks they will never make a film of.
In my previous Post I remarked that I didn’t consider FDR’s Second Bill of Rights to be rights. Rather, I consider them to be responsibilities a society owes its members.
Just to clarify the matter, I believe Rights are what individuals holds within themselves. To say someone has a right to health care immediately implies that the health care giver is obligated and does not have the right to refuse. This violates the rights of the health care giver.The same may be said for housing, employment, education, etc.
But a Society does have the Responsibility to provide to its members health care access (even basic health care), basic housing, basic education, competitive opportunities in business, equal employment opportunities, and a social assurance to the elderly, disabled, unemployed and young. I think FDR’s Bill of Rights baselines a good deal of society’s responsibilities to its members.