One more post on foreclosures

“Wouldn’t it be great to have a system that met people trying to do the right thing halfway?” ~ Mike Konczal, putting several bullets through my speculation that a foreclosure slowdown could result in moral hazard on the part of homeowners.

So I’ll just come right out and say it: I was wrong yesterday. I was being combative and got into an argument on a topic which A) I hadn’t put a ton of thought into and which B) I took a lousy position on. I let what I viewed as an unnecessary swipe at libertarians get in the way of my better judgment on the more important topic at hand, the issue of foreclosure fraud.

Now, I’ve self-described as a ‘reluctant libertarian’ and a ‘liberal-tarian’ and a Cameroonesque Tory and a heterdox conservative and a number of other things in my long (and aggravating to many) journey to figure out just exactly what it is I believe, but what I am most assuredly not is a card-carrying big “L” Libertarian. So when I come to the defense of libertarians I’m not out to defend the think tanks or magazines and certainly not the Libertarian Party, but rather the many thoughtful, nuanced libertarians I know and whose work I value, and who do not fit the stereotypes at all.

I’m not really anti-government so much as I am anti-power. I’m suspicious of all large institutions and the centralization of power within those institutions, whether we’re talking about government or corporate or labor or military power or whatever. Power is a threat, and I think it’s important to find ways to limit it in both the public and private spheres. And mistermix is absolutely correct that libertarians haven’t spent enough time on the foreclosure issue. All these tidbits of government abuse – no larger, compelling narrative to tie them into the real world.

But there are things about government that are truly frightening – such as its ability to invade and bomb the hell out of countries thousands of miles away, and then capture and torture its citizenry. (The military-industrial complex is one of the worst forms of crony-capitalism, after all, as Eisenhower warned us of long ago.) This doesn’t mean we should abolish government, and I’ve never said we should – but it does mean we should hold it accountable far more than we do these days.

We should also hold accountable the banks and other corporations which wield so much economic power – we should probably not be bailing them out, for instance, when they gamble away our money, pensions, investments, entire economy and so forth. We should also not let them use fraudulent paperwork to oust homeowners from their homes. People were right to say that questioning the moral hazard of homeowners was the wrong position to take on my part, and I agree. I was wrong.

The story of the fraudulent foreclosures is pretty extraordinary (yes, I’ve brushed up on the subject a bit more since yesterday) – this mad dash on the part of the banks to squeeze as many pennies out of as many people as they can before public outrage builds enough to halt their momentum. Hopefully more cases like the Massachusetts ruling will slow them down.

P.S.

This is what I mean when I talk about corporate/government crony-capitalism:

The reality is that banks can no longer meaningfully be called private enterprises, yet no one in the media will challenge this fiction. And pointing out in a more direct manner that banks should not be considered capitalist ventures would also penetrate the dubious defenses of their need for lavish pay. Why should government-backed businesses run hedge funds or engage in high risk trading, or for that matter, be permitted to offer lucrative products that are valuable because they allow customers to engage in questionable activities, like regulatory arbitrage or tax evasion? The sort of markets that serve a public purpose should be reasonably efficient and transparent, which implies low margins for intermediaries.

Of course, the banks can continue to invest as unwisely and with as opaque a process as they like because they are not legitimately private enterprises any more. They, unlike most Americans, have a blank check from the federal government to cushion their fall should they once again face systemic collapse. Corporate welfare makes truly functioning markets an impossible fiction. It is far more damaging to a free market economy than welfare for individuals in the form of healthcare, food stamps, and so forth. Corporate welfare protects companies against failure, making the whole point of markets moot, whereas safety-nets help average people pick themselves up when markets do fail, resulting in unemployment, or from devastating illness and other unforeseeable occurrences that individuals may not be properly equipped to deal with on their own. The former breaks the system while the latter ensures that the system doesn’t end in destitution or outright revolt.






156 replies
  1. 1
    CorgiFan says:

    Nice post, E.D. You’re a bigger man than Palin, that’s for sure.

    But seriously, this is very magnanimous of you.

  2. 2
    Villago Delenda Est says:

    I’ve said this before, and I’ll say it again.

    E.D. is not your stock glibertarian.

    He admits he was wrong.

    I expect the Randites to put a fatwa on him within the next 24 hours.

  3. 3
    Dave Ruddell says:

    I was wrong

    Three of the hardest words in the English language to say (or write). “You were right” is also up there.

  4. 4
    13th Generation says:

    Talk about off-topic. Maybe some people need a break from Palin today, but not to read another one of your hack-tastic opinion pieces on the foreclosure crisis.

    And no, I didn’t read your post.

  5. 5
    Brachiator says:

    Absent regulation, how would you propose to solve this problem of rapacious banks?

    Meanwhile, since banking is a global enterprise, we have this:

    The row over bank bonuses flared up again this lunchtime when it was revealed that the outgoing boss of bailed-out Lloyds is poised to receive a £2 million pay boost.
    __
    Eric Daniels is set to be awarded the windfall by the bank’s board in this year’s controversial bonus round. The announcement comes just 24 hours after Barclays boss Bob Diamond said City fat cats should stop apologising for paying themselves multi-million-pound bonuses.
    __
    The government bailed out Lloyds after it took over debt-ridden mortgage lender HBOS in 2008, and still holds a 41 per cent stake in the bank.
    __
    Daniels, an American citizen who leaves Lloyds in March, is entitled to a £2.3 million maximum bonus – 225 per cent of basic salary.
    __
    He has waived his bonuses for two years in a row, but any payout is likely to fuel mounting anger over bank handouts as reports suggest the industry is preparing to fork out a bumper £7 billion in bonuses.

    So, the banks not only defraud homeowners, they steal whatever is left in the form of bonuses.

  6. 6
    scav says:

    Welcome to the scrum.

  7. 7
    Belafon (formerly anonevent) says:

    A bank is supposed to serve two functions:
    1. Keep my money safe so that I don’t have to guard it.
    2. Allow that money to be used in the market to make more money.

    Even ignoring all of the other stuff that they do today, and some of they shouldn’t, a bank really can never be truly a private entity for a number of reasons:
    1. A bank can do the above better the larger it is.
    2. A bank failing should not lead to my failure.

    Because of this, banks should not be allowed to do things that could reasonably cause it to fail. Any type of short term speculation should be completely illegal. Let them go back to making loans.

  8. 8
    El Cid says:

    I do think it’s a good idea whenever possible to try and identify which subgroup of a group (or supposed subgroup) you are discussing. I try to be very careful with the term “Southerner” when the context isn’t already 100% clear, since logically it includes, say, the nation’s largest population of African Americans, millions of Latinos, not to mention whites who are not supporters of conservative / neo-Confederate policies.

    When it makes sense to distinguish, then the ‘libertarians’ being discussed can be set apart from an unknown generalized set of libertarians. Except when discussing the overwhelmingly common assertions and arguments presented by today’s actual libertarians as such thinkers identify themselves.

  9. 9
    fitzwili says:

    Thanks for this. Too often people don’t want to admit that perhaps they just spoke too quickly and perhaps issued an opinion that was ill-considered. I appreciate you revisiting your argument.

  10. 10
    Belafon (formerly anonevent) says:

    @13th Generation: Then don’t comment. STFU.

  11. 11
    Jack says:

    In reference to your self-description of “liberal-tarian” it sounds on point with what I stated in the comments the other day to my belief of the true role of government: To protect those with little power from those with a lot of power. Those with a lot of power include the wealthy, corporations (the current source of much abuse), unions (a past source of abuse, not so much any more), and the government itself.

  12. 12
  13. 13
    Barb (formerly Gex) says:

    I will just add that it was the deregulatory zeal of conservatives and libertarians that allowed banks to take on financial services. Anti-trust? Clinton had one of those cases going, but W. dropped it immediately. Too much government when they couldn’t get in trouble, too much government involvement now. It’s a little like tax cuts when things are good, tax cuts when things are bad.

  14. 14
    pragmatism says:

    nice e.d. i misplaced my vitriol toward glibertarians yesterday. i apologize.
    mcmegs is making a hash out of this topic as well.

  15. 15
    E.D. Kain says:

    @CorgiFan: Thanks.

    @Villago Delenda Est: Shit, a fatwa? I didn’t realize Randians did fatwas. I’ll definitely have to go Galt then…

  16. 16
    freelancer says:

    @13th Generation:

    but not to read another one of your hack-tastic opinion pieces on the foreclosure crisis.
    And no, I didn’t read your post.

    E.D. just wrote, perhaps, the most unHACK-est thing ever. And here you are being glib as shit. Sad.

  17. 17
    Earl Butz says:

    Nice. When it finally breaks through into your consciousness that at this point in history, corporations are FAR more powerful than the government – especially banks, as they control the money – that will be even nicer.

    Takes a big man to say “I was wrong”. Especially these days, with backstabbing jerks like this asshole waiting for you to show anything they can frame as a sign of weakness against you. Kudos, and may your quest for the real enemy continue unabated.

  18. 18
    sukabi says:

    we haz evolution!

  19. 19
    schrodinger's cat says:

    So what should be done regarding banking and the financial sector?

  20. 20
    Villago Delenda Est says:

    It is far more damaging to a free market economy than welfare for individuals in the form of healthcare, food stamps, and so forth. Corporate welfare protects companies against failure, making the whole point of markets moot, whereas safety-nets help average people pick themselves up when markets do fail, resulting in unemployment, or from devastating illness and other unforeseeable occurrences that individuals may not be properly equipped to deal with on their own. The former breaks the system while the latter ensures that the system doesn’t end in destitution or outright revolt.

    OK, obviously I was overoptimistic with my fatwa prediction. 12 hours. Tops.

  21. 21
    E.D. Kain says:

    @Belafon (formerly anonevent): I think Tyler Cowen’s musings on income inequality and the financial sector are very useful when thinking about this subject.

  22. 22

    Absent regulation, how would you propose to solve this problem of rapacious banks?

    Personally, I would like to use existing anti-trust laws (or modify them if they lack power) to break up the TBTF institutions into state wide entities that lack the power to completely f*** over the economy and hold tax dollars hostage.

    More local competition and better service to customers and greater investment in their communities.

  23. 23
    geg6 says:

    @Jack:

    Those with a lot of power include the wealthy, corporations (the current source of much abuse), unions (a past source of abuse, not so much any more), and the government itself.

    The idea that unions were ever big or powerful enough to abuse anyone is an out and out lie. Who, exactly, did they abuse? The working people who created them? This is so much crap that I, though I can sympathize with some of your sentiments, have put you into the category of people too stupid to even listen to. Pie for you, Jack.

    That said…

    Good on you, E.D. Kain. Glad to see you, alone among any libertarians of any stripe of my acquaintance, can admit a mistake. Wish more of your compadres could do the same.

  24. 24
    Villago Delenda Est says:

    @13th Generation:

    OK, you’re the new unthinking asshat du jour. Hard to displace Sarah Palin, but you’ve done it.

    Pat yourself on the back.

    Then go back and READ THE FRACKING POST.

  25. 25
    E.D. Kain says:

    @schrodinger’s cat: I don’t think that’s an easy question but off the top of my head:

    1. Tighter leverage requirements. Canada’s banks did well during this downturn and I suspect that’s largely due to their much lower leverage ratios.

    2. Honestly, who can say? These bankers are smart and not risk-averse and know what will happen if they screw everyone over again. Read the Cowen article I linked to and especially the bit on the financial sector. It’s depressing.

  26. 26
    matoko_chan says:

    meh.
    SOP.
    naow ED says “i was wrong” yet……

    I let what I viewed as an unnecessary swipe at libertarians

    there are no unneccessary swipes at libertarians.
    libertarians have been wholly suborned by the socons and bankstahs.
    c’est le meme chose.

    let me hear ED say “supply side economics are WRONG”
    or say…..”Hayek was WRONG”….or say “the GOP is naow a religious party” or……the bankstahs caused the econopalypse and ill believe in redemption.
    this is just more headfake.

  27. 27
    matoko_chan says:

    meh.
    SOP.
    naow ED says “i was wrong” yet……

    I let what I viewed as an unnecessary swipe at libertarians

    there are no unneccessary swipes at libertarians.
    libertarians have been wholly suborned by the socons and bankstahs.
    c’est le meme chose.

    let me hear ED say “supply side economics are WRONG”
    or say…..”Hayek was WRONG”….or say “the GOP is naow a religious party” or……the bankstahs caused the econopalypse and ill believe in redemption.
    this is just more headfake.
    he fooled you guys again.
    borrrrrrrrrrrrring

    DIAF EDK.

  28. 28
    geg6 says:

    Damn it. I meant the strike through to only go through the union bullshit.

  29. 29
    Villago Delenda Est says:

    I’m not really anti-government so much as I am anti-power.

    OK, now we’re talking. This is what the Founders were obsessed with. Unchecked power. It’s why we’ve got three more or less co-equal branches of government, and why the “unitary executive” is such a threat to our republic. It’s why while I understand why Obama wants Congress to take the lead, it’s why he can’t sit back and wait for them to act. They’re too conditioned not to, although Nancy Pelosi tried her hardest to act, the amazing invertebrate known as Reid, who refused to make Rethugs threatening to filibuster actually do it, and expose themselves to the nation as obstructionist assholes.

    Big business has to be offset by government looking over its shoulder. This also means that, as a check and balance, big business needs to object to regulations they think are onerous and explain, in a transparent fashion, why they are. They need to make REASONED ARGUMENTS about it, not just scream at the top of their lungs (and with their checkbook), which is what the US Chamber of Commerce does nowadays.

    Transparency is needed all about. If that hurts the feefees of those who don’t want to get caught doing criminal shit, well, tough titty, asswipes. I’m talking to you, Goldman Sachs. I’m also talking to Joe Biden, Hillary Clinton, Joe Lieberman, and the rest of the “Assange is a terrorist!” crowd.

  30. 30
    Michael D. says:

    The biggest threat to the American financial system came when the big investment houses went public. It allowed them to gamble with other peoples money. I’m not a financial expert by any stretch of the imagination, but my gut says that they should be private institutions run by people who, when they gamble, have to absorb the losses themselves.

    My guess is that, when faced with being hit in their own wallets and losing their luxury homes and yachts, these people will stop doing things like inventing credit default swaps and repackaging them as CDOs that no one has a clue about the contents of.

  31. 31
    ThatLeftTurnInABQ says:

    First of all, congrats on the mea culpa. Not an easy thing to do.

    Regarding this:
     

    I’m not really anti-government so much as I am anti-power. I’m suspicious of all large institutions and the centralization of power within those institutions, whether we’re talking about government or corporate or labor or military power or whatever. Power is a threat, and I think it’s important to find ways to limit it in both the public and private spheres.

    So my question is: as a practical manner how do you propose to deal with this problem? The Liberal answer is that government power, which in a small-d democratic system is at least nominally responsive to voters, serves to check and balance the power of corporations, in a manner not unlike that of the internal architecture of the US govt itself. This view at least acknowledges two thing that appear to me to be missing from a Libertarian viewpoint: (1) the reality that power centers exist and flowing as they do from our very flawed human nature are impossible to fully suppress, and (2) an attempt to use them in a constructive fashion to mitigate each other’s worst effects.

    If you fear and oppose the idea of a powerful central govt (and you do give good reasons for doing so, starting with the Military Industrial complex), then what power center do you propose we use to tame the corporations? Or do you have a theory indicating how the corporations can be shackled without any center of organized power, and if so then what is it?

    And a followup question: do you feel that as a practical matter it is possible to organize the political economy of a large OECD country in a manner more libertarian than the US circa 1876-1901, or is that as good as it gets? If that is as good as it gets, does that kind of society seem preferable to you to what we have today, or do you feel that the steps taken since then under the leadership of both Roosevelts have given us a better society than what we had in McKinley’s day?

  32. 32
    E.D. Kain says:

    @Villago Delenda Est: I think the trick is not Big Business making these objections – they will often lobby for more regulations that hurt their competitors. It’s average people, small businesses, and the rest of us with little power that need to find ways to check both big business and government. Yes, those two can check one another, but they so often don’t. That’s the obstacle, and I honestly don’t know how to overcome it. Deregulation is certainly not always the answer, but nor is regulation always the answer. It’s tricky.

    P.S. The site is moving really bloody slow right now.

  33. 33
    E.D. Kain says:

    @geg6: I think someone can be supportive of labor and the right to organize without such full-throated support that they cannot see the many problems organized labor can and has caused – I would say especially in the public sector and specifically in certain places in the country. I don’t really want to get into a side debate on the merits and/or flaws of unions or public sector unions though. Another time, another thread.

  34. 34
    Barb (formerly Gex) says:

    @E.D. Kain: We had leverage requirements, but the SEC waived them for the big 5. I think Michael D. is on to something though.

  35. 35
    Jan says:

    @geg6:

    teamsters

  36. 36
    Midnight Marauder says:

    @E.D. Kain:

    It’s average people, small businesses, and the rest of us with little power that need to find ways to check both big business and government.

    This is a nice sentiment, but it doesn’t mean anything. At the end of the day, this is the question you still have to grabble with:

    @ThatLeftTurnInABQ:

    If you fear and oppose the idea of a powerful central govt (and you do give good reasons for doing so, starting with the Military Industrial complex), then what power center do you propose we use to tame the corporations? Or do you have a theory indicating how the corporations can be shackled without any center of organized power, and if so then what is it?

    What you are proposing, E.D., is not something that is applicable in any substantive way in the real world.

  37. 37
    Violet says:

    Nice post. Apologies by pundits are as rare as the snow leopard. It’s refreshing to see one, especially one done so well.

  38. 38
    fasteddie9318 says:

    @13th Generation:

    Face, meet palm.

  39. 39
    va says:

    I’m not really anti-government so much as I am anti-power.

    It seems like libertarians think they’re interesting because they claim to be anti-power; to me, it’s what makes them most annoying. It’s a completely unsophisticated, adolescent stance: that guy has power, and I don’t like it. What libertarians have no critique (or conception) of is how political power is maintained and deployed over time, which I suspect is why they think once “power” is “taken away” from some institution, it’s happy-ending, game over. In reality, power is not a thing to possess. It’s a matrix of other stuff: wealth, rhetoric, and legitimacy coerced and consented to.

    Libertarians frame their proposals as, “If we take power away from x, then power will be conferred on y,” y being in most cases “the individual,” whatever that is. But “power” just doesn’t work like that. It’s not a thing. It can’t be transferred. There’s no vacuum that must of necessity be filled once it’s “taken away.” It can only be configured and re-configured.

  40. 40
    Villago Delenda Est says:

    @E.D. Kain:

    E.D., I think the single biggest obstacle is that a healthy 30% of the population does not act in its own long term economic interest.

    Instead, they’re obsessed with race, with sex, with the thought that someone, somewhere, is either getting over on the system (they are…they’re trust fund babies…) or is having fun (they are…those gays are having orgasms that these twits can only imagine with the help of PornoTube).

    How do you get these disaffected masses to understand what the true issues are?

    That’s the challenge. The forces of evil (for want of a better word) have for the last 30 years been working, ceaselessly, to dumb down the masses as much as possible. Their problem is overextension…if they deprive Homer of his beer and TV, Homer might just something something. Then we’ll have classic “interesting times” of the Chinese curse variety.

  41. 41
    geg6 says:

    @E.D. Kain:

    Whatever you may have to say about it, unions never have and never will have the power to oppress people. The only people they “oppress” are the oligarchs and corporations who find it more difficult to enslave and oppress working men and women. When you can find anything awful at all that a union has done that outweighs the good they’ve done (minimum wage, the end of child labor, the work day and work week, health care, and on and on and on and on), then we can talk. Until then, unions are a societal and economic good, period.

  42. 42
    Belafon (formerly anonevent) says:

    @geg6: They did force us all to take a 40 hour work week, those bastards.

  43. 43
    E.D. Kain says:

    @ThatLeftTurnInABQ:

    So my question is: as a practical manner how do you propose to deal with this problem? The Liberal answer is that government power, which in a small-d democratic system is at least nominally responsive to voters, serves to check and balance the power of corporations, in a manner not unlike that of the internal architecture of the US govt itself. This view at least acknowledges two thing that appear to me to be missing from a Libertarian viewpoint: (1) the reality that power centers exist and flowing as they do from our very flawed human nature are impossible to fully suppress, and (2) an attempt to use them in a constructive fashion to mitigate each other’s worst effects.

    This is an excellent question. I think the flaw that I see in the liberal answer is that the very system you rely on to check big business is so often usurped by big business to work against small businesses and smaller companies attempting to enter the market. So a regulation that is intended to make toys safer inadvertently puts used toy stores and mom and pop toy stores out of business because the added expense of the regulations makes it impossible for small outfits to compete against large outfits. This is a good critique of the liberal answer, but unfortunately I find that the libertarian response is not quite satisfying either. Avoiding some regulations is all well and good – especially if it keeps mom and pop in business. But it’s not enough, because maybe there are very real safety concerns here. So more transparency is probably the best answer, but it’s also really hard to enforce since most people aren’t going to pay attention anyways.

    If you fear and oppose the idea of a powerful central govt (and you do give good reasons for doing so, starting with the Military Industrial complex), then what power center do you propose we use to tame the corporations? Or do you have a theory indicating how the corporations can be shackled without any center of organized power, and if so then what is it?

    I think it depends a lot on the type of corporation you’re talking about. But as a guiding rule I’d say more layers of regulation and more local regulation is a good start. Read Mike Konczal on the subject of preemption.

    Also, I think forcing corporations to compete is important. Sometimes the government has to be involved in this process – breaking up cartels, price-fixing rackets, etc. Sometimes the government has to remove protections it has granted to certain industries or corporations. Competition keeps firms honest (or more honest). So keeping a very low barrier to entry for competitors and low barrier to exit for consumers is really important.

    And a followup question: do you feel that as a practical matter it is possible to organize the political economy of a large OECD country in a manner more libertarian than the US circa 1876-1901, or is that as good as it gets? If that is as good as it gets, does that kind of society seem preferable to you to what we have today, or do you feel that the steps taken since then under the leadership of both Roosevelts have given us a better society than what we had in McKinley’s day?

    I’m not a gold-standard guy, and I thought a lot of the stuff out recently about the ‘golden age’ of libertarianism was nonsense. No, I don’t think that period was the best libertarian society possible. It was a time of inequality and terrible market fluctuations, bank failures, etc. We can do better. Part of doing better means constructing and maintaining and paying for much better safety nets than were available then. Leaving out the human component of the economy – which one would be forced to do if one were to brag about that time period – leaves out the most important part.

  44. 44
    geg6 says:

    @Jan:

    And what, exactly, have the Teamsters (and you can’t seriously be talking about today’s Teamsters) done to oppress Americans? Are you telling me that the Teamsters are and have been as powerful as corporate America and the millionaires that run them? Are you just stereotyping the Teamsters because someone once told you horror stories about Jimmy Hoffa? Are you even aware of how the Teamsters are organized and run today?

    You are ignorant of this subject.

  45. 45
    schrodinger's cat says:

    @E.D. Kain: Banking and financial sector can be regulated the question is whether there is a political will to do it. I see that part of the equation missing, neither am I holding my breath for it to change any time soon.
    For starters:
    1. Stricter leverage requirements
    2. Breaking up the big banks
    3. Reinstating Glass Steagall
    4. No OTC derivatives
    5. FDA like federal agency that tests these derivatives in all kinds of scenarios not just the rosy ones.
    6. The entire executive compensation structure which rewards short term gains at the expense of long term well being of the enterprise has to change. (Less obsessing over quarterly earning reports, for example)

  46. 46
    geg6 says:

    It’s average people, small businesses, and the rest of us with little power that need to find ways to check both big business and government.

    And it’s for these people and for exactly that reason that unions came about.

  47. 47
    Carnacki says:

    @schrodinger’s cat: Jail those who broke the laws. I spent a long time signing documents when I obtained my loan and was told all was necessary for legal reasons. But the banks that made a mess of county and state property laws should stand trial and be sentenced to jail time, preferably for each count. Sure, that might result in millions of years in prison if each count resulted in a one year prison term to be served consecutively, but on the other hand we are talking about theft and fraud on unprecedented scales. If bankers went to prison — ok, with realistic sentences — it also might lead the powers to be to improve prison conditions for everyone.

  48. 48
    Bob says:

    E.D., pretty good post, but I gotta say that Libertarian, big L, economic dogma is adolescent drivel.

    Free markets, my ass.

    Two questions. Where? When?

  49. 49
    schrodinger's cat says:

    @Carnacki: Agreed, like the Enron Perps. I too wonder why no one has gone to jail yet over financial meltdown of 2008.

  50. 50
    Barb (formerly Gex) says:

    Continually refusing to see how delegitimizing government helped the banks manipulate the government into a pro-business stance, namely because conservatives and libertarians have half the population thinking “government bad”. Yes, there is a more nuanced stance that can be taken, but the conservatives and libertarians don’t agree whole hog. So all we get is the “government bad” agreement.

  51. 51
    Villago Delenda Est says:

    @matoko_chan:

    he fooled you guys again.

    Stop being kneejerk and read what he wrote.

    He’s actually making some sense. We’ve got more work to do on this,obviously. The devil is always in the details. The law of unintended consequences hangs over our efforts like the sword of Damocles.

    But this is the point of working things out in a democratic process. It’s difficult work. It would be much easier to simply have a dictator, as long as the dictator is anyone but a trust fund shitstain like George W. Bush, deserting coward.

    Yeah, it’s simpler, and you can get back to watching Dancing with the Stars, but there are things more important than immediate short term amusement and gratification, you know. Sometimes the payoff from all that work is a feeling of satisfaction that lingers and is not lost in a blaze of glory.

    I’d like to think that some of my posts opened his eyes to what he was saying, and he realized that his words were at odds with what he thought he believed.

    Give the guy a chance. I see genuine remorse in his most difficult three words. “I was wrong”. That’s much more than you’ll ever get from Sarah Palin.

  52. 52
    va says:

    Shorter my comment: the Libertarian notion of power became obsolete with the advent of our modernity, if it ever mattered at all.

  53. 53
    Midnight Marauder says:

    @E.D. Kain:

    This is an excellent question. I think the flaw that I see in the liberal answer is that the very system you rely on to check big business is so often usurped by big business to work against small businesses and smaller companies attempting to enter the market.

    I think it depends a lot on the type of corporation you’re talking about.

    I think it’s rather interesting that you’ve never made a remark about “it depends a lot on the type of government you’re talking about,” but rather, it continues to be “sometimes you need more regulation, sometimes you need less.”

    Again, only one political party in this country actually drafts and enforces regulations. The other one just finds ways to make them less effective and practically nonexistent.

    You keep talking about holding government “more accountable” without ever taking a moment to delineate who is behind the levers of power and how their ideological approach can subvert the intended nature of government.

  54. 54
    E.D. Kain says:

    @Bob: You can say this about almost anything. Most of our ideas are guiding lights, not magic bullets.

  55. 55
    geg6 says:

    @Belafon (formerly anonevent):

    I know. They should DIAF just for that. And, personally, I love the idea of 6 and 7 year olds working the line. All they do is sit around playing video games anyway, so it should do them all some good. And don’t even get me started on all that workplace safety crap. If you want to be safe, become a millionaire and then you can pay for your own damn safety.

  56. 56
    Elvis Elvisberg says:

    Not at all surprised to see this post. Thanks, E.D.

  57. 57
    Currants says:

    @matoko_chan: c’est la même chose.

  58. 58
    E.D. Kain says:

    @Midnight Marauder: What I actually keep saying that big business often finds ways to capture government. I’ve offered at least one idea – preemption, and a more decentralized approach to regulation – that I think has merit, and you seem to be ignoring it. I don’t even see where I said “make government more accountable” though, generically yes, it would be nice.

  59. 59
    Mary G says:

    ED, you are a gentleman, which isn’t ordinary. Glad to see we haven’t run you off.

  60. 60
    Mary G says:

    Washington Monthly has a bunch of people telling President Obama what to say in his State of the Union speech. This is about how big businesses are hurting small businesses by making it standard to pay bills only after 60-120 days go by, putting the small businesses into cash crunches. My mortgage doesn’t allow me to wait 4 months to make a payment.

  61. 61
    E.D. Kain says:

    @Mary G: Thanks!

  62. 62
    E.D. Kain says:

    @Mary G: And here you get into a serious issue with the credit ratings agencies as well.

  63. 63
    ThatLeftTurnInABQ says:

    @E.D. Kain:
    Thanks for the substantive response.
     

    This is an excellent question. I think the flaw that I see in the liberal answer is that the very system you rely on to check big business is so often usurped by big business to work against small businesses and smaller companies attempting to enter the market.

    Agreed. The Liberal approach requires constant struggle to keep the govt from being corrupted and co-opted. All of the liberals I know personally regard that a something they are committed to doing and a price worth paying for the benefits obtained from a more activist govt. Nobody told us this was going to be easy, but then you can say the same about self-government in the larger sense (“A Republic gentlemen, if you can keep it”).
     

    So a regulation that is intended to make toys safer inadvertently puts used toy stores and mom and pop toy stores out of business because the added expense of the regulations makes it impossible for small outfits to compete against large outfits. This is a good critique of the liberal answer, but unfortunately I find that the libertarian response is not quite satisfying either. Avoiding some regulations is all well and good – especially if it keeps mom and pop in business. But it’s not enough, because maybe there are very real safety concerns here. So more transparency is probably the best answer, but it’s also really hard to enforce since most people aren’t going to pay attention anyways

    You seem to have strong associations correlating small business size and moral virtue, which colors your policy prognosis. Why is that? I’m not aware of any empirical data to back that up.

     

    But as a guiding rule I’d say more layers of regulation and more local regulation is a good start. Read Mike Konczal on the subject of preemption.
     
    Also, I think forcing corporations to compete is important. Sometimes the government has to be involved in this process – breaking up cartels, price-fixing rackets, etc. Sometimes the government has to remove protections it has granted to certain industries or corporations. Competition keeps firms honest (or more honest). So keeping a very low barrier to entry for competitors and low barrier to exit for consumers is really important

    Talk like that can get you branded as a Liberal.
     

    No, I don’t think that period was the best libertarian society possible.

    I guess what I’m curious about is, do you see the flaws of the US in the last quarter of the 19th century coming from it not being sufficiently libertarian and if so do you think it is practical to push thru to a society which is more libertarian than we were back then, or not? From my point of view I don’t think it is possible to have a large, complex urbanized society on the scale of the US today less regulated, or with a smaller and less powerful central govt, than was the case in the Gilded Age.

    On the other hand if you don’t like the Gilded Age as a model, do you think the ideal libertarian society would be less libertarian than the US circa 1876-1901, and if so then in what ways and how much? Where does your ideal society sit on a sliding scale of govt size and power compared with corporate power, between what we have now and what we had back then?

  64. 64
    DougJarvus Green-Ellis says:

    It’s entirely possible that I goaded you into your original position by being more of an asshole than was strictly necessary.

  65. 65
    Barb (formerly Gex) says:

    You keep mentioning size and interstate competition.

    Yesterday I pointed out how interstate sales of insurance was a lousy way of making insurance competitive. We’ve seen that with credit cards, where SD dropped the bottom out of their regulations and all credit companies moved there.

    It was late in the day, so I was not able to see if you responded. I would still, however, like to see how you would address this rather obvious problem.

  66. 66
    E.D. Kain says:

    @DougJarvus Green-Ellis: Anything is possible.

  67. 67
    sukabi says:

    @schrodinger’s cat: doncha know, Madoff was the cause of that, and he’s doing big time… and they’re rounding up tons of other folks… I guess they don’t merit the same corporate protection as the titans on wall street.

  68. 68
    Midnight Marauder says:

    @E.D. Kain:

    What I actually keep saying that big business often finds ways to capture government. I’ve offered at least one idea – preemption, and a more decentralized approach to regulation – that I think has merit, and you seem to be ignoring it.

    I’m not ignoring your idea. I’m challenging it on the grounds that you continue to refer to government as though it’s some kind of nebulous entity that exists in a vacuum where it is unaffected by who is wielding its power. Big Business has captured government because that’s the driving mission of the Republican Party and their ostensible libertarian allies. It’s not some kind of mistake that happened overnight; it was a methodically executed plan that has spanned decades upon decades. So when you just say “preemption” and a decentralized approach to regulation, that doesn’t really mean anything because you are not taking into account the salient fact that we are already in a period of decentralized regulation and that is a primary reason why Big Business has been able to capture government.

    I don’t even see where I said “make government more accountable” though, generically yes, it would be nice.

    This is you in your original fucking post:

    This doesn’t mean we should abolish government, and I’ve never said we should – but it does mean we should hold it accountable far more than we do these days.

    Emphasis mine.

  69. 69
    E.D. Kain says:

    @ThatLeftTurnInABQ: Quick reply, because I’m almost out of time.

    I use “mom and pop” as shorthand. I’m actually not of the belief that small businesses are necessarily better. I just think that it’s hard to make and keep a very level playing field, and that a level playing field is important to keep the players honest. I’m well aware of the many problems with local business and ‘mom and pop’ shops.

    Re: your question of an ‘ideal libertarian society’ you know, I’ll have to give it some more thought. I don’t do the ‘ideal society’ thought experiment much. What I want is a society that grows as naturally as possible, that progresses but also holds on to important traditions, and which allows as many people to prosper as possible. In some ways, if the turn of the 19th/20th century had been more libertarian – particularly civil libertarian – it would indeed have been better. But in other ways, that time lacked important social programs that have indeed improved the life of many people. Then again, so have many technologies, more prosperity, etc. Each time is unique. I’ll try to do your question more justice in the future.

  70. 70
    matoko_chan says:

    @Villago Delenda Est: dude hes boilerplate.
    this is his schtick.
    @sukabi: spoofed you again.
    i guess u missed this?

    I let what I viewed as an unnecessary swipe at libertarians get in the way of my better judgment

    they are ALL THE SAME.
    fake libertarians that sold out to the bankstahs and the jesushumpers.

  71. 71
    E.D. Kain says:

    @Midnight Marauder: Ah yes, I was thinking of my comments…

  72. 72
    Barb (formerly Gex) says:

    @Barb (formerly Gex): Sigh. Cannot see that continually undermining government is what helped weaken government in relation to corporations. I see no suggestion of any other check on corporations. This fetish of smaller, interstate competition is great in theory, but there seems to be no answer for the flaw with that model. I’ve asked at least 3x in these threads. I’ve seen several responses after I asked it this time.

    If there is no answer for this problem, stop proposing it as a solution.

  73. 73
    Dollared says:

    EDK, thanks for a great post. It really leads me to wonder what exactly is the use of the “Libertarian” label? The most prominent and powerful people who call themselves Libertarians have allied themselves with the Party that would outlaw the romantic choices of 10% of our population, would deny the reproductive freedom of 51% of our population, and would subject 99% of our population to workplace tyranny by the other 1%. And they have been critical water-carriers for the very megacorporations (Not just banks, but telcos, defense contractors, oil companies and agribusiness giants) that have colluded with the government to produce the most non-market-based economy this country has experienced since 1932.

    And yet the label was important enough that you reflexively defended the megabanks because you felt you had to defend the “libertarian” tribe.

    So a thought experiment: can you come up with a different label that conveys your concept of “individual liberty in the face of all oppression, public or private?”

  74. 74
    Villago Delenda Est says:

    @matoko_chan:

    He’s admitted, albeit not explicitly, that the swipe wasn’t all that undeserved, by his reaction, what he posted, and now he realizes that DougJ was making a very valid point that, to be brutally honest, knocked him out of some complacency on his views.

    E.D., if you think I’ve overstated here, feel free to slap me around, but I think I’m on the right tangent, at least.

  75. 75
    Barb (formerly Gex) says:

    @Dollared: That’s been a made a dirty word. It is a blood libel, if you will.

  76. 76
    ericblair says:

    So when you just say “preemption” and a decentralized approach to regulation, that doesn’t really mean anything because you are not taking into account the salient fact that we are already in a period of decentralized regulation and that is a primary reason why Big Business has been able to capture government.

    Not to mention the fact that as you decentralize, i.e. go from federal to state to local government, regulatory capture gets worse not better since the imbalance between large corporations and the governments gets worse. So you can stop wondering why large car dealerships are so protected from external competition by state governments, or lots of local governments allow real estate developers to do basically whatever they want.

    I, too, don’t think it’s some law of nature that corporations will take over the regulatory apparatuses. It only seems that way if you’ve been looking at the goals and results of the Republican Party.

  77. 77
    Barb (formerly Gex) says:

    @Barb (formerly Gex): Guess I’ll go check the other thread…

  78. 78
    eemom says:

    @geg6:

    ferfucksake, do you ALWAYS have to be so fucking nasty and dismissive when someone doesn’t toe the party line?

    I don’t pretend to be an expert on this subject, but there WAS a time in history when the Teamsters were heavily infiltrated by the Mafia, wasn’t there? I really think that’s all that person was implying by the single word “Teamsters.”

    And no one is more pro-union than me, including your own duly respected self-righteous ass.

  79. 79
    sukabi says:

    @matoko_chan: didn’t miss it… figure 1 step forward, 2 steps back… is better than standing in place stomping feet… at least we know movement is possible.

  80. 80
    Barb (formerly Gex) says:

    @Barb (formerly Gex): Nope. If you don’t like the impression we have of libertarians, you should probably avoid doing the things that we don’t like about libertarians.

    As I was saying yesterday: Hopeless.

  81. 81
    les says:

    @E.D. Kain:

    I think the flaw that I see in the liberal answer is that the very system you rely on to check big business is so often usurped by big business to work against small businesses and smaller companies attempting to enter the market.

    Such a nice start, and then this. You really would be better off examining your assumptions–this statement, and many others you make, essentially translates as “the liberal preference is bid, badly operating government.”

    This liberal’s answer to this problem is as complex as the problem; but it rests in a professional, non-partisan civil service; with a union that can help its members resist political/economic pressure. Consider–how does the “usurpation” you (quite properly)decry happen? Your assumption appears to be that it’s automatic. I say no; it’s the result of economic cooptation of the political process, followed by political cooptation of the bureaucracy–not, by the way, an evil term. Example: republicans (and no few libertarians) want lower taxes above all political outcomes; so they attack the IRS, demonizing its employees, underfunding, etc. etc. The record in demonstrating actual abuses is pathetic.

    Some methods to get there? Far shorter campaign seasons, public financing of campaigns, legislate over the Citizens decision. Far fewer political appointments; it’s shameful the number of posts unfilled because of republican obstructionism; but why should any president be making hundreds of political appointments in the executive branch? Porfessionalize all but the top tier–it would make the bush regime attempted destruction of the system ( the shameful staffing of the Dept. of Justice is only the most public case) much more difficult, would provide continuity of exercise of executive power and would make regulatory capture that much more difficult.

    You’re clearly not stupid, E.D. But it sure looks (to the extent that you write here, anyway) as if you are driven by assumptions and beliefs, often without examination.

  82. 82
    les says:

    And if I could find an edit button, “bid” above would be “big”, as intended.

  83. 83
    ThatLeftTurnInABQ says:

    @Dollared:

    So a thought experiment: can you come up with a different label that conveys your concept of “individual liberty in the face of all oppression, public or private?”

    There used to be left (i.e. anti-capitalist) libertarians. We called them “anarchists” and they even had a color associated with them (black) as distinct the association of a different primary color with left authoritarians (“reds”). But over the course of the 19th and early 20th centuries the anarchist name acquired a deeply pejorative association with assassinations, bombings and other forms of unacceptable violence from below and has fallen out of favor as a result. It seems to me that today a vaguely left of center libertarianism is coming back into the spectrum of acceptable political thought amongst careful observers of our society, but there isn’t a non-tainted word to describe this point of view and give it a flag to rally around.

    Also, our world today suffers from the lack of a viable anti-capitalist ideology since the collapse of the USSR if for no other reason than to give our most powerful capitalists some reason to exercise their stewardship of our society with a degree of prudence which has been sorely missing since 1991.

  84. 84
    Barb (formerly Gex) says:

    @ericblair: I have been repeatedly asking him how he would avoid the credit card industry/South Dakota example. Not one word over these two days. He has no solution for the problem of regulatory capture at the state level. I think he thinks interstate competition is the solution. But who the fuck knows? I don’t merit a response.

  85. 85
    les says:

    @E.D. Kain:

    So a regulation that is intended to make toys safer inadvertently puts used toy stores and mom and pop toy stores out of business because the added expense of the regulations makes it impossible for small outfits to compete against large outfits.

    Quite possibly a bad example. Just because a business is (by some definition) small, is not a good reason to allow it to sell goods that, you know, injure and kill its customers. If a business is too small to operate safely, well…

  86. 86
    Barb (formerly Gex) says:

    @les: Dead children are just a minor moral hazard compared to the larger moral hazard of telling business what to do or making business suffer an inefficiency. Have you not seen his deep deep concern for the banks over the people who would be rendered homeless?

  87. 87
    Omnes Omnibus says:

    Cheers on the mea culpa, E.D. Concerns about power are warranted. This, however, is the problem I see, we live in a world with big government and big business. We have no chance of controlling big business or making it work in out interest. This is not true of government. It can be, and has been been, control by the people and made to work for their benefit. It has the possibility of being used to control or counteract big business. I do not see any other alternatives on the horizon. As a result, it seems to me that a realistic view of the world would accept this and involve looking for ways to bend government toward good works. With that, I will drop this, lest it somehow become more fuel for a brawl.

  88. 88
    Turgidson says:

    @E.D. Kain:

    What I want is a society that grows as naturally as possible, that progresses but also holds on to important traditions, and which allows as many people to prosper as possible. In some ways, if the turn of the 19th/20th century had been more libertarian – particularly civil libertarian – it would indeed have been better. But in other ways, that time lacked important social programs that have indeed improved the life of many people. Then again, so have many technologies, more prosperity, etc.

    Are you sure you’re not a Democrat?

  89. 89
    eemom says:

    @Omnes Omnibus:

    With that, I will drop this, lest it somehow become more fuel for a brawl.

    No, don’t drop it. It is an excellent point you make and if we let the presence of one or two delusional self-proclaimed geniuses with a cow fetish crazy people in our midst stifle our right to freedom of brawlery, the blood libelers will have won.

  90. 90
    Turgidson says:

    @Omnes Omnibus:

    We have no chance of controlling big business or making it work in out interest.

    In theory we do – shareholders throw out malfeasant boards of directors, consumers stop buying the corporation’s goods and service, etc etc. But I agree that the system, as it were, has become so large and prone to collusion and underhanded dealing, and the levers that purport to keep the corporations under control so insulated from those who would control them from a desire for long-term good, (among umpteen other factors) that your statement is correct.

    Problem is, government is taking a similar form nowadays. But again, I agree with you that our chances are better there. And it IS the only realistic check on corporate power we have.

  91. 91
    Dollared says:

    @les: this. Nicely put, and it hits all the unsubtle points of the “Libertarians” campaigns to undermine the government as a force to offset the power of corporations.

    When I was a child, we understood all this. Over the last 30 years, we have unlearned it all.

    I am not a great fan of “innovation.” I know what it usually covers.

  92. 92
    Omnes Omnibus says:

    @eemom: If E.D. or someone in ideological sympathy wants to respond, I will pick it up again. I just don’t want to be one of the guys beating up on him as he does a decent thing.

  93. 93
    Dollared says:

    @les: and it is yet another myth. If a town lacks toy stores, it is Wal-mart’s sourcing and margins that are to blame.

    I live in a large city without Wal-Marts. We have one small, profitable toy store per ~10,000 children, and I swear my six year old knows the GPS coordinates, current inventory status, and staff directory of each one.

  94. 94
    Omnes Omnibus says:

    @Turgidson: As the French say, it is great in practice, but how does it work in theory?

  95. 95
    polyorchnid octopunch says:

    @E.D. Kain: Well, it’s not just that they have much lower leverage levels. Up until 2006 (when the Conservative Party under Harper came to power) they were also much more restricted in the kinds of mortgages they could offer, as well as who they could offer it to and what kind of documentation they had to have to be able to get one. For example… no 40 year mortgages. No ARMs. No subprime mortgages. When the CPC came in, they relaxed all those rules, and some of the bankers went to town. However, they just didn’t have enough time to rack up enough problems to crash the economy when it all went south for you guys. There’s also a cultural difference; when the shit hit the fan, there were several interviews with some of the bank CEOs, where they pretty much stated that they decided that they weren’t generally that interested in some of those financial tools because in their opinion it would violate the spirit of what the banking institutions were for within Canadian society.

    We have mortgage brokers in Canada, but there’s a crucial difference between them and outfits like Countrywide. They cannot originate loans; all they can do is put prospective lenders and borrowers together and help them with the negotiations over the terms of the loan, which are still subject to all the regulation about what you are and are not allowed to offer as terms for a loan.

    To a large extent, it was thanks to the fact that we had Paul Martin as finance minister in the nineties, because as the owner of Canada Steamship Lines (and a billionaire in his own right… he actually did make the money himself) he understood how those things worked. I can remember very well in the nineties when the Bank of Montreal tried to merge with the Royal Bank of Canada. First off, he said no. Full stop. They banks went to some of their pet people in the business press (esp. in the Report on Business in the Globe and Mail) and tried to crank up the outrage machine. Then they went back. He told them ‘okay, tell you what… I’ll let you merge, but I’ll also open up the Canadian banking market to every bank in the world.’ They changed their mind.

    So, what was it that saved our banking system? We didn’t join into the global deregulation frenzy. Our banking system is still highly regulated as well as being highly protected. Yep… regulation. It’s what’s for breakfast for countries that want to maintain their societies in a sane manner.

  96. 96
    Ruckus says:

    @Mary G:
    This is an old mime that keeps getting repeated every time there is a downturn. I heard this on a financial program in the 80-81 recession. I thought, not one of my suppliers would sell me another thing if I did that and I’d be out of business. But it’s OK for the big guys, they make a little bit in the float between small business paying and them paying their bills. So profit!

  97. 97
    Dollared says:

    @ThatLeftTurnInABQ: Well, anarchists do have a bad name. However, on the viable alternative, of course we have a proven, viable alternative ideology that has been successfully adopted, tested and proven superior to that produced by our nation, much less any communist or authoritarian nations.

    It’s called social democracy, or CanadaFranceGermanyDenmarkNetherlands for short.

    Its manifest success is why the screaming gets the loudest when people mention the success of European political solutions.

  98. 98

    @E.D. Kain: Much longer post required, but fixing the banking sector begins with remembering the distinction between commercial and investment banking.

    Commercial banking is a utility, and should be no more exciting than running a water company.

    Investment banking is a casino, and should be denied any presumption of government backing.

    Both sectors need to be regulated. The one to ensure that banks with an implicit (or explicit) government guarantee — deposit insurance, the support for a secondary mortgage market, and so on — do in fact remain in the boring and formerly larger half of the banking business. Strict leverage limits, fiduciary standards and much more.

    The other – (a) to make sure that those investing with such banks are capable of doing so in terms of wealth and presumption of knowledge and (b) not so leveraged that a failure would produce such counterparty damage that it could not be reasonably contained.

    There is a big argument now about the appropriateness of especially the more exotic derivatives recently constructed, with some saying that essentially all such instruments are too fraught to be permitted at all, and others saying that the underlying idea of derivatives is still sound, but needs much more clever and comprehensive regulation. I’m in the latter camp, actually.

    My sister in law, one of the top economic policy planners for South Africa, has recanted: she used to believe strongly in the value of derivatives in lowering the cost of money to a lot of people; now she thinks that no goverment agency can keep up with their problems, and hence they are too dangerous to national/global economies to be allowed to run amok in the global financial system.

    As she actually works on the ground in this area, and has real training it it, I’d put my money on her — but work I’m doing now on 17th and early 18th century origins of banking and finance is, so far, giving me a different view.

  99. 99
    KG says:

    @Midnight Marauder: you don’t necessarily need one central government to govern corporations. There can be some at the federal level, some at the state (both where the corporation is organized and where it is headquartered).

  100. 100
    Midnight Marauder says:

    @Omnes Omnibus:

    With that, I will drop this, lest it somehow become more fuel for a brawl.

    Nah, son. That’s not how it works. Brawls are self-sustaining ’round these parts.

    Ain’t no fuel required.

  101. 101
    Ruckus says:

    @E.D. Kain:
    I own a small biz and should be on the small biz side, but I think that clouds the actual issue.
    The size of the business does not make it better or worse. It can make it more likely that you can get better individual service, but even that is not necessarily true.
    It is how the company is run and what it’s long term goals are that are important. A smaller company generally by it’s nature has to take a longer term look at it’s business practices and customers or it will loose them. A larger company can give less a crap about customer service/product choice/pricing as it may be a monopoly or possibly a duopoly depending on the product/service and the area served.

  102. 102
    Omnes Omnibus says:

    @Midnight Marauder: Dude, I wanted plausible deniability for when it happened.

  103. 103
    Midnight Marauder says:

    @KG:

    you don’t necessarily need one central government to govern corporations. There can be some at the federal level, some at the state (both where the corporation is organized and where it is headquartered).

    Sure enough, but what you are describing still involves a need for centralized government at the state and local level, bolstered by an overarching federal government. It’s not really some kind of abstract exercise. We have seen what happens when the regulatory ability of governments (federal, state, local) is lessened in the face of advancing interests from Big Business, and it leads us to exactly the kind of landscape we have now.

    The system you’re describing still requires regulations that have teeth, and regulators with the ability and willingness to enforce them. But again, there’s a major difference in what you’re describing versus what E.D. was discussing. You are still talking about government existing in some legitimate, substantive form on various levels; wheras E.D.’s proposal centered on “average people, small businesses, and the rest of us with little power” checking both Big Business and Big Government. You are still viewing government as having the ability to be of assistance to regular people because that’s the fucking reason governments exists in human civilization. You aren’t arguing for the creation of an entirely new administrative entity to combat both Big Business and Big Government.

    That’s a key difference, I would say.

  104. 104
    Barb (formerly Gex) says:

    @KG: Perhaps you can tell me how smaller firms, with interstate competition will prevent the situation that happened with South Dakota and the credit card companies. Would the feds have to set minimum regulations to prevent one of the states from dropping the bottom out on regulations? Then, what is the point of that, since maybe only a few states would construct stricter regulations?

  105. 105
    Midnight Marauder says:

    @Omnes Omnibus:

    Dude, I wanted plausible deniability for when it happened.

    Butch: I meant what now between me and you?
    Marsellus: Oh, that what now. I tell you what now between me and you. There is no me and you. Not no more.

  106. 106
    Ozymandias, King of Ants says:

    @va: This. A thousand times this.

    Christ, I’m so sick of libertarians whose arguments all treat power and freedom as if they were tangible commodities to be moved about the world, like sacks of corn or barrels of oil.

  107. 107
    Barb (formerly Gex) says:

    @Ozymandias, King of Ants: The phrase I like to use is “thought experiments”. They run all kinds of simulations in their heads about how things work. It apparently takes a couple of threads worth of hammering to get facts accounted for. And I still can’t get a answer to my question.

    Other phrases that come to mind: tedious, hopeless, frustrating, waste of time

  108. 108
    pragmatism says:

    @Barb (formerly Gex): regulating against race to the bottom is right out ’cause it would be more regulation and that’s just not a solution for libertarians. its much like framing the deficit as a spending problem only. and we’re dumb because we want all solutions on the table.

  109. 109
    Barb (formerly Gex) says:

    @pragmatism: So their only solution is to shoot down the only viable tool to check corporate power, the federal government?

    And we are supposed to take EDK seriously why?

  110. 110
    pragmatism says:

    @Barb (formerly Gex): that’s my guess for why he won’t respond to you over the past couple of days. there isn’t an “approved” solution outside of hoping against hope that our galtian overlords remember that their mistress ayn stressed RATIONAL self interest. but they don’t because there isn’t enough incentive to do so.

  111. 111
    Ailuridae says:

    @Omnes Omnibus:

    This is, essentially, a I view the American political system (absent a third pole of big Labor). Big Business can’t be constrained from abusing the population so there is only one other option: a strong centralized government to counter the natural tendency of Big Business to accumulate ever more power to the detriment of the people.

    Also I should mention that the link to NC is using a really broad brush with banks. A huge percentage of all banks in the US never securitized a mortgage and didn’t want or need TARP funds.

    @polyorchnid octopunch:

    Excellent posts. It is weird that ED would mention Canada as a case of good banking (and I very much agree Canada’s solution is far more intelligent) and not realize that it is a heavily, heavily regulated banking sector. One could argue that it is, by far the most regulated banking sector of any Western democracy.

  112. 112
    Barb (formerly Gex) says:

    @Ailuridae: Was that fact in his thought experiment? Then it isn’t a factor in why Canada’s banking industry did okay. See?

    I really refrained from the abuse others were dishing out. But really, I can see that it is fucking useless to have a debate with even the most reasonable libertarian you can find.

    Fucking hopeless.

    Fucking irritating.

    Waste of fucking time.

  113. 113
    JPL says:

    Thanks Kain.
    Now my mea culpa.. On an earlier post I expressed a lot of anger because I thought you were ignoring vile and hatred that is occurring in our nation. Your post was accurate because you were highlighting one particular group and maybe we should celebrate little steps.

  114. 114
    matoko_chan says:

    @sukabi: well im FUCKING SICK OF THAT DANCE.
    @E.D. Kain: you nave no “ideas” whore. You have “beliefs”. anti-empirical beliefs.

    Now, I’ve self-described as a ‘reluctant libertarian’ and a ‘liberal-tarian’ and a Cameroonesque Tory and a heterdox conservative and a number of other things in my long (and aggravating to many) journey to figure out just exactly what it is I believe, but what I am most assuredly not is a card-carrying big “L” Libertarian. So when I come to the defense of libertarians I’m not out to defend the think tanks or magazines and certainly not the Libertarian Party, but rather the many thoughtful, nuanced libertarians I know and whose work I value, and who do not fit the stereotypes at all.

    name one you useless glibertarian assclown. so i can shred him into cat litter like im doing with you.

  115. 115
    matoko_chan says:

    @Barb (formerly Gex): all you evah get from this assclown is weasel words. hes McMegan with a dick, Douchebag sans the rubber clean suit and the sterilization protocols.
    now hes gonna run to his glibertarian homies and brag about he schooled us again.
    i swear ima greif every FUCKING thread this assclown posts here Cole.
    he has no desu.

  116. 116
    Mr. Poppinfresh says:

    Can someone please ban the semi-literate troll already? At least Darrell was legible.

  117. 117
    Mr. Poppinfresh says:

    As for unions: there are legitimate cases of entrenched unions, especially white-collar ones, being as stubbornly inflexible in the face of necessary change as government institutions. Teachers unions and public service unions are two great examples that I’ve had to deal with in a professional capacity.

    I’m not going to sit here and defend my progressive credentials to anyone, so don’t bother accusing me of being some nefarious right-wing plant. It’s simply been my experience that unions can be just as powerful and obstinate as any other group at the table. Just because it’s less common doesn’t make it impossible or irrelevant.

  118. 118
    Barb (formerly Gex) says:

    @Mr. Poppinfresh: A fair assessment. What human institution is perfect? Still a necessary counterbalance to corporate power if you ask me.

  119. 119
    matoko_chan says:

    @Villago Delenda Est: ALL HIS POSTS ARE THE FUCKING SAME.
    this happens everytime.
    its a fucking tape loop.
    he says somethin’ stupid, feebly tries to defend it, takes a righteous asswhuppin in the comments, whines to Cole, then mea culpas and circles back around to the same oid hayekian crapology.
    FUCKING ENOUGH ALREADY!
    how many times do we have to do this dance?
    this fucker is unteachable.

  120. 120
    Turgidson says:

    @Mr. Poppinfresh:

    All true. I interpreted geg’s posts on unions more to mean that a union behaving badly isn’t going to wreak the same kind of havoc on the population as concerted corporate or federal government bad behavior can (and that they provide important counterbalances to the power of “management”, generally speaking. The waste and inefficiency that entrenched unions can create are small time compared to, say, what happened in fall 2008.

  121. 121
    Ozymandias, King of Ants says:

    @eemom: Show us on the doll where the Teamster touched you.

    Otherwise, STFU.

    Because when you say things like

    I don’t pretend to be an expert on this subject, but there WAS a time in history when the Teamsters were heavily infiltrated by the Mafia, wasn’t there? I really think that’s all that person was implying by the single word “Teamsters.”

    both you and the person who wrote that original response are painting the entire Teamster rank-and-file membership of that time as suspect which is complete and utter bullshit.

    And anyway, your post doesn’t address the point you were supposedly responding to:

    @geg6:

    The idea that unions were ever big or powerful enough to abuse anyone is an out and out lie.

  122. 122
    matoko_chan says:

    @Mr. Poppinfresh: im not a troll, im a griefer. i haz beaucoup desu.
    an’ im far more literate than any commenter here, except those that caught my stellar joycean tagging on conservative deadwhiteguy phailosophy.
    phall if you will but rise ye must, old person.
    language evolves.
    lead, follow, or get out of my fucking way.

  123. 123
    matoko_chan says:

    @Mr. Poppinfresh:

    I’m not going to sit here and defend my progressive credentials to anyone, so don’t bother accusing me of being some nefarious right-wing plant.

    nah. you are just another old person that didnt couldnt read Finnegans Wake.
    theres loads of your clones here.

  124. 124
    Ozymandias, King of Ants says:

    @Mr. Poppinfresh:

    unions . . . being as stubbornly inflexible in the face of necessary change as government institutions.

    But the unions are not government institutions.

    Take teacher’s unions. One only has to go back to the 1960s to find a time when teachers were–in CA at least–so poorly paid that you couldn’t be a teacher and also afford to have a family. And they only drew a salary 9 or 10 months out of the year. Since teachers were usually women, it was simply expected that their husbands would earn the majority of the household income.

    Now, you’ve finally got teachers earning decent money, thanks largely to the unions. But you’ve got very powerful forces arguing that we should take that away from some teachers based solely upon some very dubious measurement of their “effectiveness.”

    Thus, it doesn’t surprise me in the least that the teachers are getting “obstinate.” And collective bargaining has been always adversarial, so that’s just in the nature things, isn’t it?

  125. 125
    Ozymandias, King of Ants says:

    @Ozymandias, King of Ants:

    And collective bargaining has been always adversarial, so that’s just in the nature things, isn’t it?

    And when more people were union members themselves, this was something generally understood. But with the union membership numbers we have now, it isn’t, so we get horror stories of teachers, cops, and firemen being “obstinate.”

  126. 126
    dollared says:

    And EDK, one more little thing – is there any reason to say that RortyBomb put a few bullets through your argument?

    Could we lay off the bullets for this week only?

    Now, let’s get back to how devolving regulation to the states is a race to the bottom….

  127. 127
    Barb (formerly Gex) says:

    @Ozymandias, King of Ants: Indeed. Our system is all about checks and balances. That was a key feature of the plan for this country. Unions should be in opposition to management, the government should be a neutral arbiter between the two.

    But someone managed to convince Americans that unions are bad, period. And it doesn’t seem to be about old-timey Teamser issues, but rather about the fact that the image of the union worker has been turned into overpaid, underworked, and lazy, yet making way more than they are.

    My roommate works at a glass supplier to Anderson windows. These past two years there have been layoff after layoff. Now, there’s mandatory overtime that she bitches about. Still, she fucking HATES unions. I say they should fire more people and demand more overtime in that case.

  128. 128
    Barb (formerly Gex) says:

    @Barb (formerly Gex): Note, I’m not saying unions were part of the country’s plan. Just this idea of balancing power to keep it in check.

  129. 129
    sukabi says:

    @Ozymandias, King of Ants: 60’s, 70’s, in WA state were the same way… and the smaller districts still struggle to pay teachers decently.

    My dad was a teacher in a very small district during that time period, it was a struggle both financially and in the ensuing wage battles with the district to get any kind of increase in pay… plus as you stated, they only paid for the nine months school was in session… dad picked up summer work with the forest service to make ends meet… the teacher’s unions helped alot with wage / working negotiations…

  130. 130
    Batocchio says:

    Good for you, sincerely.

    As for as “unnecessary swipe at libertarians,” well… Yes, there are some reasonable people who self-identify as libertarian, but they’re not as prominent. As long as they recognize the limitations of their own ideology, they can be useful gadflies. But generally, that sort aren’t being criticized here. Meanwhile, there are plenty of dolts and obnoxious people who describe themselves as libertarian, and do comprise those “think tanks or magazines and… the Libertarian Party.” Hey, if an idea has merit, it has merit, and if it’s dumb, it’s dumb. Radley Balko, for instance, has written some great stuff about civil liberties violations, but that’s firmly in the liberal tradition, both “classical” liberal or modern. As Tristero’s written, pretty much everything good about libertarianism already exists in liberalism. Plenty of self-described libertarians have no problem with abuse of power when it’s done by a citizen or company, yet have a childish opposition to all things governmental. In fact, that’s almost definitional for “libertarian” on the Reason-Cato-rightblogger circuit. The social contract requires compromises, balances, and readjustments, and a childish absolutism that denies the many benefits of the Commons misses that.

    Whether inadvertently or disingenuously, most of those “professional” libertarians you mention further the goals of plutocracy and plutonomy. That’s pretty much every McMegan post ever written. The Reason crew (with their Ayn Rand slogan) may have the conceit that they’re anti-authoritarian, but the consequences of most of their positions amount to a defense of the status quo, or a further concentration of wealth and power. That’s precisely why the Kochs fund them. So yeah, there are some reasonable people who self-describe as “libertarian,” but there are also plenty of useful and eager idiots. (I’ve got more in two old posts, “The Social Contract” and American Politics Seen as a Japanese Monster Movie.”.)

  131. 131
    matoko_chan says:

    @Batocchio: good posts.
    i adore the kaiju eiga.
    i wrote a post on how Iron Man is our post 911 version of the Godzilla movies.
    and you are absolutely right.
    which is why ED is unable to nominate a single one of …” the many thoughtful, nuanced libertarians I know and whose work I value, and who do not fit the stereotypes at all. ” for our inspection.
    they only exist in EDK’s head.

  132. 132
    eemom says:

    @Ozymandias, King of Ants:

    both you and the person who wrote that original response are painting the entire Teamster rank-and-file membership of that time as suspect which is complete and utter bullshit.

    wrong, asshole. Go register at Ant King Remedial Reading School, and come back when you’ve mastered the basics.

  133. 133
    Barb (formerly Gex) says:

    @Batocchio: I think you are giving EDK a wee bit too much credit. His big suggestion for handling too big to fail banks was smaller banks and interstate competition.

    I have repeatedly asked him what will prevent a South Dakota/credit card industry type bottoming out of regulations in one state. No answer. Repeatedly asked over two days. I guess we could call this the good kind of libertarian. But I’ve seen unfounded arguments and solutions that just pose more problems. IOW – typical libertarian.

  134. 134
    E.D. Kain says:

    @Mr. Poppinfresh: Very true.

  135. 135
    Mr. Poppinfresh says:

    The problem with collective bargaining for public employees as opposed to private ones is that public employees don’t hurt their ‘management’ when they go on strike.

    When GM line workers strike for the purposes of bargaining, GM stops making cars and GM stops making money. When civil servants go on strike… do you really think the government, no matter what the level, suffers very much? The only people who suffer during a bus strike or a garbage strike are average citizens, not the people actually negotiating the contract. The ‘management’ negotiators’ only incentive to settle favorably towards the union is that they will get yelled at by the electorate, which is hardly a bottom-line issue from their perspective- if it’s far enough away from the next election, or the opposition is in disarray, or whatever, they will still get away with it. Or, if you’re forced to shell out for some ridiculous 4%-a-year-every-year contract, it’s not your money so who cares.

    So you either have interminable strikes with neither side giving two shits about who suffers (see: every municipal bus or garbage strike in the history of the world), or larded-up contracts that are created by management negotiators who could give less of a shit how much it costs in the end.

    Which also gets to the real problem facing most public-sector unions: defined-benefit pension plans (the favorite lard of the last 50 years) are simply, factually unsustainable. Salaries are not even remotely the problem, just like private-sector unions are not remotely the problem. Conflating the two, when there is a very real, very legitimate issue in public-sector pension liabilities and zero problem with some company choosing to pay their auto workers whatever the fuck they feel like, is just as disingenuous as anything Republicans throw out there.

    I say this as a young person with an ever-expanding, cushy defined-benefit pension plan at work that will go broke long before I can collect. In the mean time, me and my generation will be on the hook for paying out benefits to boomer public employees who gamed the system in their favor with not one single fucking economist on Earth telling them the numbers worked. You don’t have to be a member of the Cato institute to look at the DB pension information I get once a year and be outraged at the hubris.

    Or in other words: the next person to bring up a blue-collar steelworker as an example of problematic unions loses the argument.

  136. 136
    Barb (formerly Gex) says:

    @E.D. Kain: Wow, really? I have been asking you the same question since you dropped the interstate competition bullshit. No answers at all. I was civil, yet ignored.

    So fuck that. If you don’t like being considered a typical libertarian, stop coming in here arguing from ideology and when you propose a solution, if we have a question about it, you should answer it.

    I see no goddamn reason to give libertarianism even the slightest bit of respect if this is what one of the “good” ones is like.

  137. 137
    E.D. Kain says:

    @Barb (formerly Gex):

    I have repeatedly asked him what will prevent a South Dakota/credit card industry type bottoming out of regulations in one state. No answer. Repeatedly asked over two days. I guess we could call this the good kind of libertarian. But I’ve seen unfounded arguments and solutions that just pose more problems. IOW – typical libertarian.

    This is a complete falsehood. I answered this question over several comments. Here’s one:

    It’s quite easy to change the rule – and we could do it for credit cards, too – to make regulations apply to the state of the customer rather than the state of the issuer.

    Followed up later by this:

    You buy your policy in Arizona from a company in Minnesota, you get the AZ regulations. A guy in Idaho buys it from the same company, he gets his Idaho regulations. Thus the regulations are accountable to the people. You go visit family in Texas, you still have your insurance purchased under AZ regulations. Ditto for credit cards and buying stuff with those credit cards online.

    So you see, my answer was simple. Right now credit card regulations apply to the state of the issuer rather than the state of the consumer. Changing one tiny rule would change the entire game. Same goes for insurance.

    But you have made your mind up about me and dug yourself in at this point. So please go on ignoring my replies and putting words in my mouth.

    Edit: This obviously requires a lengthier explanation at some point. Suffice to say, it is much harder for a big corporation to game 50 states than it is for one corporation to game just one state or one federal regulatory body. Decentralized regulation has its perks when it comes to interstate sales and finance.

  138. 138
    Barb (formerly Gex) says:

    .@E.D. Kain: No, I hadn’t seen those responses, and I have been checking. I’m sorry I missed them.

    My apologies. And yes, that minor rule change does seem reasonable.

    I have been asking nicely for quite some time, but I see you waited until I became rude before responding to me. You could have pointed this out earlier, but then you wouldn’t have had the opportunity to scold me.

  139. 139
    Barb (formerly Gex) says:

    @Barb (formerly Gex): The funny thing is, before I got rude, I mentioned to someone else that I thought that was the reason I wasn’t responded to. I guess you have confirmed that.

  140. 140
    Barb (formerly Gex) says:

    @Barb (formerly Gex): This isn’t operative, but I’ve missed the delete window.

    Again, apologies, EDK.

  141. 141
    Johannes says:

    @E.D. Kain: Well done, E.D. I appreciate this.

  142. 142
    Chris Grrr says:

    E.D. – a salute, for good intentions.

  143. 143
    LikeableInMyOwnWay says:

    The sentiment is being celebrated now, in all the great libertarian nations of the world.

  144. 144
    polyorchnid octopunch says:

    @E.D. Kain: If you’re having problems with your politicians being purchased by big business, what you’re looking at is a problem of participation. If you want to see things change, the American people need to start moving into their parties en masse, and outvoting the money people within the parties.

    I’m in Canada. I participate in my democracy between elections, not just in the voting booth. Most of my peers do too. I write letters and sometimes drop in on the riding office of my mp or mpp when I see something I don’t like and tell them. I do so politely, and give them reasons why I think something (like currently bill S-10 up for third reading in the House of Commons, about minimum sentencing) that’s coming up is a terrible idea, and if their party supports it, they can expect to lose my vote.

    On the other hand, if I’d been getting screwed as badly as poor people do in America when I was poor, I’d probably feel a little hotter under the collar than I do now.

  145. 145
    polyorchnid octopunch says:

    @geg6: Ding.

  146. 146
    roshan says:

    Wow! Our children is definitely learning. You did good, E.D, you did good. Accepting fault in debates is a big deal nowadays since no one ever does that anymore (yeah, Cole does it rather too frequently so he is an exception). But it’s good to see you around here again on the frontpage and also in the much slanderous comment sections.

  147. 147
    E.D. Kain says:

    @Barb (formerly Gex): I honestly can’t keep track of when you requested the answer and when I answered you! So no worries. I was just sort of surprised by your comment above since I had (wrongly) assumed you’d seen my responses in the other thread.

    And yes, the rule change is reasonable but of course only if people get mad about the fact that this is how the regulation has been implemented so far. Of course, a simple rule change would cost banks millions upon millions of dollars so it’s going to be a tough one to implement, but it would also be very, very popular if voters understood it!

  148. 148
    E.D. Kain says:

    @Johannes: @Chris Grrr: @roshan:

    Thanks everyone. This has been a fun thread.

  149. 149
    Ozymandias, King of Ants says:

    @E.D. Kain: I may be wrong, but isn’t that no so much an arbitrary rule and more like a SCOTUS precedent?

  150. 150
    Ozymandias, King of Ants says:

    @E.D. Kain: Ah yes, here it is: Marquette Nat. Bank of Minneapolis v. First of Omaha Service Corp. (439 U.S. 299)

  151. 151
    E.D. Kain says:

    @Ozymandias, King of Ants: It’s been a while since I’ve read up on it. Will do some digging.

  152. 152
    brantl says:

    You keep talking about the dangers of power, and there are dangers to power. In a democracy, the only way for power to be misused is by lying or obfuscation.
    If you have transparency, this can be a self-correcting system. Then, power is a two-edged sword. If you have politicians study history (not spin it), then power becomes a major force for good. When you figure this out, ED, is when you’ll be a liberal. Perhaps you’ll follow in JC’s footsteps.

    And by the way though your apology took a long time, you made it. Good for you. Well done.

  153. 153
    brantl says:

    @matoko_chan:

    DIAF EDK.

    Have you been such a mean-spirited douchebag that you can’t get when someone’s admitted they were wrong?

    People don’t learn everything at once, SCHMUCK.

  154. 154
    brantl says:

    And yes, the rule change is reasonable but of course only if people get mad about the fact that this is how the regulation has been implemented so far. Of course, a simple rule change would cost banks millions upon millions of dollars so it’s going to be a tough one to implement, but it would also be very, very popular if voters understood it!

    Not really expensive, it’s a software change. It would take a little bit of work and tables on existing law that could be updated, that’s about all.

  155. 155
    matoko_chan says:

    @brantl: dude, get a clue.
    this is the 20th post where EDK headfakes a mea culpa and goes right back to feedlot drench with the same recycled conservative shit.
    im just fucking sick of it.
    at beginning, i respected John’s right to have him as a frontpager, even when he refused to recant his teatard fetus=slave bullshytt.
    i was willin to give him a chance on John’s Lincoln position.

    but how many times do we have to do this dance?
    EDK says something stupid, gets an epic asswhuppin in the comments, whines to John, apolos, and waffle words and circumlocutes back around to his original calumnies, cheif among those that conservatism still has anything to offer, that both sides are the same, and the riddickulous premise that libertarians are anything but intellectual whores in babylonian captivity to the jesushumpers/socons and the bankstahs.
    hes had enuff chances.
    hes a grievous waste of spacetime on the frontpage, which has actually stellar, thoughtful intelligent posters who i might disagree with but who are actually capable of guerilla thought, unlike EDK who is pithed by the mythology of conservative ideology.
    His soi disant libertarian tendencies are just another headfake.
    You despise Douthat and McMegan as spinners and partisan propagandists dont you? EDK is their exact isomorph.
    I believe in redemption, but EDK is not redeemed.
    He refuses to admit that conservatism is an empty purse, a failed paradigm, and engages in the mythologies of supply side economics and Hayekian principles.
    I’ll believe EDK can be redeemed when he renounces Hayek.
    Because, Hayek was WRONG.

  156. 156
    matoko_chan says:

    and notice also…..Sully rarely links EDK’s posts at balloon juice– prefering EDK’s other blogs– precisely because EDK gets raped in the comments EVERY FUCKING TIME.
    And it makes the “real” conservatives and “principled” libertarians look bad.
    Sully is just another conservative shill. Took even Y.T. a while to see that.
    mea culpa.
    /wicked grin
    bonus points for those of you that get the stephenson reference.

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