Disruption of the middle class

[Brisketexan 104629]

3 minutes ago, DonkeyCigars said:

And this is where I have always anchored my argument to the lightspeed advancement of technology, especially social media and instant interconnectedness, as bad.

You need a hearts and mind change, to view the middle class as an aspiration and goal instead of a mediocre stepping stone to the good life. Social Media/Technology has distorted reality and expectations and goals for a life the same way instant hardcore porn on demand has psychologically distorted the reality of sex for people. There is a real analogy there; people who are 5's who should be mating with other 5's become incel's because they think they should have 10's. People who by education and skill and value should be happy with a middle class life, yearn for more because of social media constantly feeding them what the high life looks like.

This isn't wrong.  Being happy because you are satisfied, and content, is a value we should have.  Which we've abandoned.  What you're talking about is hygge:

Quote

Hygge (pronounced hue-guh not hoo-gah) is a Danish word used when acknowledging a feeling or moment, whether alone or with friends, at home or out, ordinary or extraordinary as cosy, charming or special.

Hygge (or to be “hyggeligt”) doesn’t require learning “how-to”, adopting it as a lifestyle or buying anything. It’s not a thing and anyone telling you different either doesn’t understand it or is literally trying to sell you something that has nothing to do with the concept. You can’t buy a ‘hygge living room’ and there are no ‘hygge foods’ to eat.

What Is The Meaning Of Hygge?

It literally only requires consciousness, a certain slowness, and the ability to not just be present – but recognize and enjoy the present. That’s why so many people distill ‘hygge’ down to being a ‘feeling’ – because if you don’t feel hygge, you probably aren’t using the word right.

Another definition of hygge is “an art of creating intimacy” (either with yourself, friends and your home). While there’s no one English word or simple definition to describe hygge, several can be used interchangeably to describe the idea of hygge such as cosiness, charm, happiness, ‘contentness’, security, familiarity, comfort, reassurance, kinship, and simpleness.

Danes created hygge because they were trying to survive boredom, cold, dark and sameness. The undefinable feeling of hygge was a way for them to find moments to celebrate, acknowledge and break up the mundane or harsh. With so many cold, dark, days, the simple act of lighting a candle and enjoying a cup of coffee could make a huge difference to one’s spirit.

By creating simple rituals without effort {such as brewing real tea with a little china cup every evening to stopping at the flower shop every week} the Danes see both the domestic and personal life as an art form and not every drudgery to get away from. They incorporate hygge into their daily life, so it becomes a natural extension rather than a forced and stressful event.

We had a few friends over for crawfish and oysters this past weekend.  It wasn't lobster and caviar.  We didn't go to an expensive restaurant.  It wasn't a show.  It was food and friends, and damn, it made us all happy.  As Americans, we need to re-learn how to be happy with the simple pleasures.  

Our problems aren't individual, they aren't cultural, they aren't political.  They are all three, woven together.

[Wanker Bob 379]

On 4/6/2021 at 3:00 PM, Brisketexan said:

I've wanted to be all wrong for YEARS now.  I desperately want to be wrong about all this shit.

I'm sick of being more right than wrong about this shit.  But the vast majority of Americans insist that we're super awesome, and any criticism or suggestion of change must be resisted with all possible might, because that's hatin' on 'murica, and why are you a socialist corporate communist?  We're committing suicide, and we're fucking PROUD of it.

So, fuck it....hook me up with more of them green tips.

[DonkeyCigars 144]

16 minutes ago, Brisketexan said:

This isn't wrong.  Being happy because you are satisfied, and content, is a value we should have.  Which we've abandoned.  What you're talking about is hygge:

We had a few friends over for crawfish and oysters this past weekend.  It wasn't lobster and caviar.  We didn't go to an expensive restaurant.  It wasn't a show.  It was food and friends, and damn, it made us all happy.  As Americans, we need to re-learn how to be happy with the simple pleasures.  

Our problems aren't individual, they aren't cultural, they aren't political.  They are all three, woven together.

The other side of the coin, which is one where I struggle to reconcile because I am too close and biased as a product of it, is rooted in American exceptionalism and extreme individualism (again, American exceptionalism) which when distilled looks like this:

"Who are you to tell me I can't be a big shot? Screw you, trying to hold me back or put a ceiling on me." of which a mediocre person can point to numerous, thousands if not millions, of other mediocre people throughout American history who have, indeed, hit it big through luck, determination, timing, etc.

We love the mythology of someone from the wrong side of the tracks being a big shot. When poor people daydream and fantasize about making it out of poverty they don't fantasize about being able to go to an Applebee's every Wednesday without fretting about the bill, they think:

"We used to fuss when the landlord dissed us
No heat, wonder why Christmas missed us

Birthdays was the worst days
Now we sip Champagne when we thirstay!"

(Peace to Ron G, Brucie B, Kid Capri, Funkmaster Flex and Lovebug Starski)

 

Edited April 14, 2021 by DonkeyCigars

[Brisketexan 104629]

2 minutes ago, DonkeyCigars said:

The other side of the coin, which is one where I struggle to reconcile because I am too close and biased as a product of it, is rooted in American exceptionalism and extreme individualism (again, American exceptionalism) which when distilled looks like this:

"Who are you to tell me I can't be a big shot? Screw you, trying to hold me back or put a ceiling on me." of which a mediocre person can point to numerous other mediocre people who have, indeed, hit it big through luck, determination, timing, etc.

We love the mythology of someone from the wrong side of the tracks being a big shot. When poor people daydream and fantasize about making it out of poverty they don't fantasize about being able to go to an Applebee's every Wednesday without fretting about the bill,

This....and it's maddening.  I mean, it's all anecdotal/apocryphal, but it's part of the story told about minority underachievement -- go to a primarily african american middle school, and ask the kids who thinks they're gonna make it big in the NBA/NFL/as an athlete.....a shitload of hands go up.  Even though we all know the math says that any given middle  school, there might be one pro athlete at a given time.

Now, there's some stuff underneath that -- plenty of kids and families don't really have a model to look at for a middle class life.  They have the poverty they live in, and the rich and famous life they see on TV/their devices.  And there's plenty more.  But the end result is that there's no good vision for a middle class life or how to get there for way too many Americans.

[Bozo_Casanova 26285]

49 minutes ago, immamac said:

Small businesses and nepotism is what the future is for the upper middle class. 

And that's when Immamac became a Marxist without even knowing it.

Edited April 14, 2021 by Bozo_Casanova

[DonkeyCigars 144]

1 minute ago, Brisketexan said:

This....and it's maddening.  I mean, it's all anecdotal/apocryphal, but it's part of the story told about minority underachievement -- go to a primarily african american middle school, and ask the kids who thinks they're gonna make it big in the NBA/NFL/as an athlete.....a shitload of hands go up.  Even though we all know the math says that any given middle  school, there might be one pro athlete at a given time.

Now, there's some stuff underneath that -- plenty of kids and families don't really have a model to look at for a middle class life.  They have the poverty they live in, and the rich and famous life they see on TV/their devices.  And there's plenty more.  But the end result is that there's no good vision for a middle class life or how to get there for way too many Americans.

I think a lot of it is also maybe an awareness that a middle class life is also in a lot of ways a facade of security and comfort. Most "middle class" Americans are a job loss or injury or mistake away from poor class if they are out of work for an extended period of time. Just not being paycheck to paycheck doesn't afford longterm security or comfort and there is a low-grade anxiety that I can acutely remember from when that was me. Granted it's better than poverty, but I think viscerally people feel that the only way to truly be secure and comfortable is with the riches that making it big provide (and even then, you can't take extreme debt positions with your big money--as we've seen from countless athletes to Bill Hwang and other risky capitalists)

[immamac 42521]

3 minutes ago, DonkeyCigars said:

The other side of the coin, which is one where I struggle to reconcile because I am too close and biased as a product of it, is rooted in American exceptionalism and extreme individualism (again, American exceptionalism) which when distilled looks like this:

"Who are you to tell me I can't be a big shot? Screw you, trying to hold me back or put a ceiling on me." of which a mediocre person can point to numerous, thousands if not millions, of other mediocre people throughout American history who have, indeed, hit it big through luck, determination, timing, etc.

We love the mythology of someone from the wrong side of the tracks being a big shot. When poor people daydream and fantasize about making it out of poverty they don't fantasize about being able to go to an Applebee's every Wednesday without fretting about the bill, they think:

"We used to fuss when the landlord dissed us
No heat, wonder why Christmas missed us

Birthdays was the worst days
Now we sip Champagne when we thirstay!"

(Peace to Ron G, Brucie B, Kid Capri, Funkmaster Flex and Lovebug Starski)

 

I don't think people hear the second half of the sentence when they are told they can be a big shot. 

I recently found a youtube channel that I thought was hilarious from a guy named techlead. He is a successful entrepreneur/tech guy in the bay area and he talks about what the difference between successful people and everyone else is. Successful people often have well defined criteria for their success and drive towards it intentionally with everything they do. 

The reason that these people can't be a big shot has to do with them not actually wanting to be a big shot, only receiving the benefits that seemingly come from big shotness. 

For the last 7 years on my phone the ringtone has been: 

https://youtu.be/PANEcjhSfv4

I subscribe to this and my ringtone reminds me every time someone calls. What am I doing to make sure that todays version of me is the best version of me that has existed? 

[DonkeyCigars 144]

3 minutes ago, immamac said:

I don't think people hear the second half of the sentence when they are told they can be a big shot. 

I recently found a youtube channel that I thought was hilarious from a guy named techlead. He is a successful entrepreneur/tech guy in the bay area and he talks about what the difference between successful people and everyone else is. Successful people often have well defined criteria for their success and drive towards it intentionally with everything they do. 

The reason that these people can't be a big shot has to do with them not actually wanting to be a big shot, only receiving the benefits that seemingly come from big shotness. 

For the last 7 years on my phone the ringtone has been: 

https://youtu.be/PANEcjhSfv4

I subscribe to this and my ringtone reminds me every time someone calls. What am I doing to make sure that todays version of me is the best version of me that has existed? 

Maybe Xzibit's finest effort. Kudos.

[Brisketexan 104629]

2 minutes ago, DonkeyCigars said:

I think a lot of it is also maybe an awareness that a middle class life is also in a lot of ways a facade of security and comfort. Most "middle class" Americans are a job loss or injury or mistake away from poor class if they are out of work for an extended period of time. Just not being paycheck to paycheck doesn't afford longterm security or comfort and there is a low-grade anxiety that I can acutely remember from when that was me. Granted it's better than poverty, but I think viscerally people feel that the only way to truly be secure and comfortable is with the riches that making it big provide (and even then, you can't take extreme debt positions with your big money--as we've seen from countless athletes to Bill Hwang and other risky capitalists)

Losing the model of "I have a good job that I can stay in for 30-40 years" has a good bit to do with that.  Again, that's a loss of security.

You either have enough money to make you secure (which requires a lot of money) or you have a secure income stream (a steady, reliable job).  As that second option has become more scarce, that leaves more people dreaming of the first.

[GW Hayduke 1952]

 

[DonkeyCigars 144]

@Brisketexan here is a real world example of trying to reconcile aggressive/exceptionalism/desire for wealth which is at odds with a "comfortable" middle class that I generally spoke about earlier:

I'm personally putting a big bet into $COIN this afternoon, despite initial guidance moving from it opening at $250/share to $375. This is a prime example of a situation in which you would rather gamble and speculate (because let's be honest, that's what this is) and put at a decent risk a middle class amount of money that could be used for conservative savings or something else to advance a middle class life, all because you want to 10x, as part of a strategy and goal to be in the 8 figures one day.

And what did I wake up thinking about to justify why you can't tell me nothing?

"If I would have put $100k in Tesla two years ago, I'd be a multi-millionaire off that single play", along with looking at how many multimillionares crypto has made, along with the dovetailing of $COIN being tied up with BTC's worth. It's the middle class equivalent of being a poor person with a decent jump shot and a little bit of height and staking your future to that 1% chance of being an NBA player.

Edited April 14, 2021 by DonkeyCigars

[troph 24563]

2 hours ago, Bozo_Casanova said:

Essentially this is the argument I’m making for most people, and remote work has made this viable:

Live someplace where you can have a home and a road trip vacation on one income. Be happy with hamburgers. Divide your labor. Work 8 hours a day, five days a week, 49 weeks a year and no more. Learn the joy of cooking and grow some tomatoes. Buy good used instead of mediocre new, wear your clothes out, don’t use credit for what you can buy today with cash  and drive your cars until the wheels fall off. By all means send the kids to college but only pay for degrees that pay for themselves. 
In other words: STOP BUYING OTHER PEOPLE CAVIAR.

thank you for listening to my Ted Talk.

except this isn't possible because of the latent risk put on labor.  you can move to a remote town that's affordable and work on zoom all day and get close to that life you're talking about.... until you're "downsized" or until you retire and don't have a pension.  there is no safety in a job anymore.  there are no "company men" anymore.  and if I'm taking the risk of losing my income because of the economy and profits for shareholders then well, I need upside baby when the economy does well and the shareholders do well.  corporate gigs do come with options and if you can climb enough that middle class opportunity may be there but I contend the latent risk is qualitatively different now than it was in the 50's and 60's and that now labor is capped on the upside and hosed on the downside.

The risk-reward dynamic has only been preserved for those willing to take extreme bets.  Maybe that's ok to have that dynamic, maybe it's okay for that risk-reward to be extreme.  what's not okay is to have labor capped on the upside and hosed on the downside. 

That's my issue and especially for skilled labor with the unions all but gone.

I think regulated capitalism can work, but unbridled oligarchy styled capitalism not so much.

Edited April 14, 2021 by troph

[Mrs Whiggins 13049]

This guy did it old school--invested in people. I agree, @troph, regulated capitalism can work and the current model of 1920s style oligarchy robber barons is not good for America as a whole.

Now, this fellow here, his business is credit card processing, so it's not producing anything, per se, but I do give him a nod to realizing that there is a lot more to some businesses than getting labor as cheap as you can so the stockholders are happy.

 

[Bozo_Casanova 26285]

1 hour ago, troph said:

except this isn't possible because of the latent risk put on labor.  you can move to a remote town that's affordable and work on zoom all day and get close to that life you're talking about.... until you're "downsized" or until you retire and don't have a pension.  there is no safety in a job anymore.  there are no "company men" anymore.  and if I'm taking the risk of losing my income because of the economy and profits for shareholders then well, I need upside baby when the economy does well and the shareholders do well.  corporate gigs do come with options and if you can climb enough that middle class opportunity may be there but I contend the latent risk is qualitatively different now than it was in the 50's and 60's and that now labor is capped on the upside and hosed on the downside.

The risk-reward dynamic has only been preserved for those willing to take extreme bets.  Maybe that's ok to have that dynamic, maybe it's okay for that risk-reward to be extreme.  what's not okay is to have labor capped on the upside and hosed on the downside. 

That's my issue and especially for skilled labor with the unions all but gone.

I think regulated capitalism can work, but unbridled oligarchy styled capitalism not so much.

I agree with you in general terms, but the bold is where I believe I haven't been clear: the risk is already 100% on labor, so they should stop playing along. You're making a cascading set of inferences about employee loyalty from my use of the term "remote work".  I'm explicitly arguing against non-reciprocal loyalty. Remote work has created a form of free agency that never existed before. People should use it.  They should also get side hustles that make sense start businesses if they have an idea, and so on. Lower costs of living and more time creates those kinds of opportunities. Austin is locally prosperous now precisely because it used to be relatively cheap and attracted a well educated young population with ideas. 

Also when you say this:

"you can move to a remote town that's affordable and work on zoom all day and get close to that life you're talking about.... until you're "downsized" or until you retire and don't have a pension."

You are describing a huge improvement in the quality of life for most people with exactly the same risk and far less financial downside due to the equity they are able to build in a lower cost geography. 

Edited April 14, 2021 by Bozo_Casanova

[DonkeyCigars 144]

29 minutes ago, Bozo_Casanova said:

I agree with you in general terms, but the bold is where I believe I haven't been clear: the risk is already 100% on labor, so they should stop playing along. You're making a cascading set of inferences about employee loyalty from my use of the term "remote work".  I'm explicitly arguing against non-reciprocal loyalty. Remote work has created a form of free agency that never existed before. People should use it.  They should also get side hustles that make sense start businesses if they have an idea, and so on. Lower costs of living and more time creates those kinds of opportunities. Austin is locally prosperous now precisely because it used to be relatively cheap and attracted a well educated young population with ideas. 

Also when you say this:

"you can move to a remote town that's affordable and work on zoom all day and get close to that life you're talking about.... until you're "downsized" or until you retire and don't have a pension."

You are describing a huge improvement in the quality of life for most people with exactly the same risk and far less financial downside due to the equity they are able to build in a lower cost geography. 

I think you are discounting the true-up that's going to occur with organizations and salaries paid as remote work settles in and markets/DMA's get valued differently. It's already happening, where I am folks who were making NY/CA salaries and bonuses aren't going to be allowed to just up and leave and move to Kansas City and live like a king. We've already been told this is happening and to expect it; this will follow for all F2000's. Salaries will be adjusted down to the COLA of your area and that sucks, but that's show business.

Edited April 14, 2021 by DonkeyCigars

[MC Fresh Breath 4074]

The exhortation for the 99% to just "do better" and "be smarter" is always annoying to me.

 

[MC Fresh Breath 4074]

 

 

Someone should tell them to just move somewhere more affordable.  Dummies.

[DonkeyCigars 144]

7 minutes ago, MC Fresh Breath said:

 

 

Someone should tell them to just move somewhere more affordable.  Dummies.

Living in certain cities is a luxury not a right. Always has been, though rosters change.

[MC Fresh Breath 4074]

[MeerkatBong 115]

This page was a fantastic read; forgot about this conversation. Even though the necrobump post was garbage, I appreciate it for letting me reread.

[MC Fresh Breath 4074]

3 minutes ago, MeerkatBong said:

This page was a fantastic read; forgot about this conversation. Even though the necrobump post was garbage, I appreciate it for letting me reread.

I like your username.  Makes me laugh.  Sorry you felt it was garbage. Care to explain?

[MC Fresh Breath 4074]

Here's another similar take that perhaps you also think is garbage.  Dunno.

Quote

 

"During this campaign, my Republican colleagues talk a lot about inflation, and they are right to do so," Sanders (I-Vt.) wrote. "Over the last year, Americans have become sick and tired of paying outrageously high prices for food, gas, healthcare, prescription drugs, housing, and other necessities."

"Unfortunately, most Republicans completely ignore the underlying causes of inflation," the Vermont senator continued, noting that a "major reason for inflation that too few people talk about" is "the unprecedented level of corporate greed that we are now seeing."

"According to a recent study, nearly 54% of the rise in inflation is directly attributable to the astronomical increase in corporate profit margins," the senator added. "In America today, while the working class struggles to put food on the table, fill up their gas tanks, and heat their homes, corporate profits are at a 70-year high.

 

https://www.commondreams.org/news/2022/11/04/sanders-says-true-economic-crisis-corporate-greed-and-gop-congress-would-make-it

[MC Fresh Breath 4074]

I'll quickly admit to not being an economist, so you can let me know if I'm being misled.

Quote

 

A measure of US profit margins has reached its widest since 1950, suggesting that the prices charged by businesses are outpacing their increased costs for production and labor.
After-tax profits as a share of gross value added for non-financial corporations, a measure of aggregate profit margins, improved in the second quarter to 15.5% -- the most since 1950 -- from 14% in the first quarter, according to Commerce Department figures published Thursday.

The data show that companies overall have comfortably been able to pass on their rising cost of materials and labor to consumers. With household budgets squeezed by the rising cost of living, some firms have been able to offset any slip in demand by charging more to the customers they’ve retained -- though others like Target Corp. saw their inventories swell and were forced to discount prices in order to clear them. 

The surge in profits during the pandemic era has fueled a debate about whether price-gouging companies carry a share of the blame for high inflation -- an argument pushed by President Joe Biden’s Democrats. Most economists have been skeptical about the idea.  

US inflation has surged this year and stood at 8.5% in July, not far short of the previous month’s four-decade high. Federal Reserve officials have pointed to rising wages as one of the big risks that could keep inflation entrenched. But some economists say that historically elevated profit margins mean there’s room for businesses to accommodate worker demands for better pay without setting off a wage-price spiral.

 

https://archive.ph/NOilY#selection-4705.0-4733.418

[MeerkatBong 115]

12 minutes ago, MC Fresh Breath said:

I like your username.  Makes me laugh.  Sorry you felt it was garbage. Care to explain?

“Greedflation” has been dismissed as political red meat/fake news theory by most respected economists for some time now. 
 

https://news.northeastern.edu/2022/08/02/what-is-greedflation-and-is-it-driving-higher-prices/

edit to add; your post above mine also says this:

The surge in profits during the pandemic era has fueled a debate about whether price-gouging companies carry a share of the blame for high inflation -- an argument pushed by President Joe Biden’s Democrats. Most economists have been skeptical about the idea.  
 

Also commondreams.org as a site to empower a liberal conspiracy theory? That’s like someone posting something from fox news to bolster a far right conspiracy theory.

Edited November 4, 2022 by MeerkatBong

[MC Fresh Breath 4074]

3 minutes ago, MeerkatBong said:

“Greedflation” has been dismissed as political red meat/fake news theory by most respected economists for some time now. 
 

https://news.northeastern.edu/2022/08/02/what-is-greedflation-and-is-it-driving-higher-prices/

edit to add; your post above mine also says this:

The surge in profits during the pandemic era has fueled a debate about whether price-gouging companies carry a share of the blame for high inflation -- an argument pushed by President Joe Biden’s Democrats. Most economists have been skeptical about the idea.  

I'll read that one, thanks.  

 

[MC Fresh Breath 4074]

I don't think all economists agree with that one though.  Dismissing it as garbage seems reductive.

Quote

 

Corporate US making consumers pay for inflation
by Julian Jacobs  1 June 2022

Declarations of corporate responsibility ring hollow
Corporate leaders have been heard bragging about strong results to investors on recent earnings calls.

Amid historically high inflation of roughly 8.5%, it is unsurprising that corporations would pass along some of the burden in higher prices. Yet the ‘marvellous’ and ‘successful pricing strategies’ company executives have been lionising are a step beyond that. Indeed, as Andrew Callahan, chief executive officer of food company Hostess, recently said in an earnings call, ‘when all prices go up, it helps.’

People are expecting prices to continue rising. Companies are taking advantage of these expectations by increasing their prices even further. As economic sociologist Lindsay Owens recently wrote in The New York Times, ‘companies that historically might have kept prices low to pick up profit by gaining additional market share are instead using the cover of inflation to raise prices and increase profits’. Federal Reserve Chair Jerome Powell recently remarked that some companies are simply raising prices ‘because they can’.

These claims are borne out in data. Over the past two quarters, despite growing costs, non-finance US companies recorded their largest profits since 1950. Rather than a consequence of the growing costs of workers and materials, the Economic Policy Institute found over half of the corporate-led increase in prices simply generated bigger profit margins. A recent senior member of Barclays told Bloomberg, ‘companies with market power feel increasingly comfortable raising prices,’ and this will reflect in overall prices in the economy. Consider Coca-Cola and PepsiCo; both companies increased prices within days of each other and recorded a 28% profit margin.

Many company owners readily admit to this. A recent survey asked 1,000 retail owners and executives how inflation is impacting profitability, pricing and discount offers. A majority of retail businesses (56%) say inflation gave them the ability to increase prices beyond what they needed to offset costs. Over half have increased prices by 20% or more on average.

Why is it that companies can capitalise on this inflationary moment to further increase their prices? There are several reasons, including the inelastic demand for certain goods, but the chief cause is likely to be the dramatic consolidation of market power by a small number of large firms. Since 1990, more than 75% of US industries have concentrated. In meatpacking and shipping, for example, large companies can hoover up as much as 80% of the market.

Commentators have cited tight labour markets as a principal risk in calcifying higher rates of inflation. There is truth to the idea that tight labour markets may be increasing prices, but this point is often overstated, particularly given the wage-suppressing combination of skills biased technological change and monopsony labour market dynamics. Indeed, inflation-adjusted wages are falling at their fastest rate in 40 years.

The consolidation of market power and consequent price gouging, on the other hand, is an issue that has received far too little attention in the inflation debate. It is a persistent problem that speaks to both the significant limitations of corporate ‘responsibility’ as well as to the need for a non-market solution to industry concentration.

These failures of stakeholder capitalism and corporate responsibility is central to a recent report by the American Economic Liberties Project. The authors ‘argue that the failure to integrate the problem of concentrated corporate power into stakeholder capitalism undermines its stated goals’ and that ‘the inherent dissonance between the perpetual drive for scale and dominance, and the recurring market abuses of the largest corporations, is a conflict that stakeholder capitalism ignores.’ And this is why we see companies like PepsiCo proclaiming their commitment to having a ‘positive effect on society’ and ensuring ‘sustainability’ while abandoning those principles when they can do so undetected.

These conflicts between the profit motive and the public interest are why extra-market solutions are not particularly radical. Indeed, 38 US states already impose price limits that prevent companies from gouging during economic shocks — a pandemic, war or natural disaster, for example. Given the relationship between market consolidation, price gouging and inflation, an effort to crack down on corporate greed should be part of the broader inflation response.

In addition to imposing a federal limit on price gouging, the Biden administration should also adopt policies utilised during the second world war to tax excess profits. Such a proposal is already coming from Senators Sheldon Whitehouse and Bernie Sanders. This kind of federal injunction would not only protect US consumers and help ward off a corporate-induced exacerbation of inflation, it would also provide protection to the US economy from the economic shocks of the future. The growing impacts of climate change will cause far more significant disruption to people, countries and global supply chains, as discussed by the White House council of economic advisers.

When such disruption happens, there is little doubt that large corporations will once again try to capitalise on the chaos to improve profits. Today’s post-pandemic bout of inflation should be a lesson for policy-makers to not let them.

Julian Jacobs is Economist at OMFIF.

 

 

[MeerkatBong 115]

Just now, MC Fresh Breath said:

I don't think all economists agree with that one though.  Dismissing it as garbage seems reductive.

 

Link?

[MeerkatBong 115]

17 minutes ago, MC Fresh Breath said:

I don't think all economists agree with that one though.  Dismissing it as garbage seems reductive.

 

Sure not all; you’ll never have 100% consensus on anything in any profession, even among respected and non-loony peers. I shouldn’t have to explicitly call that out, but here we are as a society.

That said, most economists agree— this one doesn’t I guess, and one wouldn’t be blamed to wonder if it has to do with his political bent or ambitions on why he’d lean away from popular professional consensus (he previously worked in the Obama administration).  

The post was garbage because it’s half truths meant to rile people up by manipulating their emotion and spoon feeding them something that isn’t thought to have a real correlation outside of politics. It was lazy and had nothing to do with the interesting and thoughtful discussion of this page, the deterioration of the middle class, and is brazenly political red meat for a certain political party.

Edited November 4, 2022 by MeerkatBong

[MC Fresh Breath 4074]

17 minutes ago, MeerkatBong said:

Link?

sorry, thought I pasted it but didn't.

https://www.omfif.org/2022/06/corporate-us-making-consumers-pay-for-inflation/

[MC Fresh Breath 4074]

4 minutes ago, MeerkatBong said:

 

That said, most economists agree—

do you have more on that?  

[MeerkatBong 115]

6 minutes ago, MC Fresh Breath said:

do you have more on that?  

Sure let me do all the work for you! Give me a second to do what you can’t do for yourself because you are purposefully being obtuse.

 

[DDD Dad 14252]

36 minutes ago, MeerkatBong said:

Sure not all; you’ll never have 100% consensus on anything in any profession, even among respected and non-loony peers. I shouldn’t have to explicitly call that out, but here we are as a society.

That said, most economists agree— this one doesn’t I guess, and one wouldn’t be blamed to wonder if it has to do with his political bent or ambitions on why he’d lean away from popular professional consensus (he previously worked in the Obama administration).  

The post was garbage because it’s half truths meant to rile people up by manipulating their emotion and spoon feeding them something that isn’t thought to have a real correlation outside of politics. It was lazy and had nothing to do with the interesting and thoughtful discussion of this page, the deterioration of the middle class, and is brazenly political red meat for a certain political party.

I mean, the article you linked didn't suggest that "greedflation" is garbage.  Your post was misleading as to the contents of the interview:

Quote

“On the Republican side, they’re trying to blame everything on [President Joe] Biden, which is frankly absurd—all you have to do is look around the world and see all sorts of places that are experiencing the same type of inflation that is sometimes even worse than ours,” Dickens says. “And the Democratic response is something that fits with the ideology of the left wing of the party, which is that this is all bad behavior by businesses.”

Q. Are there cases of greedflation in the U.S. economy?

A. I wouldn’t be surprised if there were some people out there who are using the excuse of inflation [to raise prices].

While his overall conclusion was that our current rate of inflation isn't solely the result of corporate greed, I don't think it's fair to say he views that perspective (as a contributing factor in some fashion) is "garbage."

And, I don't know that most who are pointing to the huge increase in corporate profits are claiming that those profits are the sole reason for inflation.  It's kind of like when people say "Black Lives Matter."  It's not because white lives don't, it's because BLM too.  

In other words, don't say that inflation is strictly Joe Biden's fault or the result of increased wages coming out of the pandemic (especially when it's a worldwide phenomenon caused not in small part by the preceding Congress's and executive administration's policies, but also just the entire global economy); you can't ignore that profits are outpacing the rate of inflation.

 

Edited November 4, 2022 by DDD Dad

[MC Fresh Breath 4074]

Just now, MeerkatBong said:

Sure let me do all the work for you! Give me a second to do what you can’t do for yourself because you are purposefully being obtuse.

 

i was trying to be polite, not obtuse.  you're the one who dismissed it as garbage and gave one economist who said so then claimed 'most' do the same.

it seems to me that there is actually disagreement out there:

https://www.nytimes.com/2022/06/03/business/economy/price-gouging-inflation.html

 

[DDD Dad 14252]

6 minutes ago, MeerkatBong said:

Sure let me do all the work for you! Give me a second to do what you can’t do for yourself because you are purposefully being obtuse.

 

And there's no need to be an asshole to @MC Fresh Breath.  He's actually trying to engage with you on the merits of your contention.  When you post shit like this it just makes me want to put you on ignore or see you end up back in purgatory.

Edited November 4, 2022 by DDD Dad

[MeerkatBong 115]

7 minutes ago, DDD Dad said:

I mean, the article you linked didn't suggest that "greedflation" is garbage.  Your post was misleading as to the contents of the interview:

While his overall conclusion was that our current rate of inflation isn't solely the result of corporate greed, I don't think it's fair to say he views that perspective (as a contributing factor in some fashion) is "garbage."

And, I don't know that most who are pointing to the huge increase in corporate profits are claiming that those profits are the sole reason for inflation.  It's kind of like when people say "Black Lives Matter."  It's not because white lives don't, it's because BLM too.  

In other words, don't say that inflation is strictly Joe Biden's fault or the result of increased wages coming out of the pandemic (especially when it's a worldwide phenomenon cause not in small part by the preceding Congress and executive administration's policies, but also just the entire global economy); you can't ignore that profits are outpacing the rate of inflation.

 

I’m not saying that. I’m saying that posting something so obviously political knowing it’s half truths and misleading, just to rile people to your way of thinking like the original tweeter was doing, is lame but understandable in politics. To put that on a nice thread which has nothing to do with that, is garbage. It’s why we can’t have nice things around here.

9 minutes ago, MC Fresh Breath said:

i was trying to be polite, not obtuse.  you're the one who dismissed it as garbage and gave one economist who said so then claimed 'most' do the same.

it seems to me that there is actually disagreement out there:

https://www.nytimes.com/2022/06/03/business/economy/price-gouging-inflation.html

 

I apologize for being a jerk then. I misread your posts tone.

[DDD Dad 14252]

15 minutes ago, MeerkatBong said:

I’m not saying that. I’m saying that posting something so obviously political knowing it’s half truths and misleading, just to rile people to your way of thinking like the original tweeter was doing, is lame but understandable in politics. To put that on a nice thread which has nothing to do with that, is garbage. It’s why we can’t have nice things around here.

I apologize for being a jerk then. I misread your posts tone.

What part of Reich's post was a half truth or misleading?  He merely said that complaining about inflation being at a 40 year high without noting that corporate profits are at 70 year high is misleading.

Reich is definitely on the progressive end of the political spectrum, but his point is fair.  There are many factors contributing for our current inflationary situation.  Let's not ignore that one of those is that corporate profits are outpacing inflation.

[Biff Tannen 45499]

47 minutes ago, DDD Dad said:

In other words, don't say that inflation is strictly Joe Biden's fault or the result of increased wages coming out of the pandemic (especially when it's a worldwide phenomenon caused not in small part by the preceding Congress's and executive administration's policies, but also just the entire global economy); you can't ignore that profits are outpacing the rate of inflation.

Add the Russian war as a big part of that too.  Food prices specifically.

[MeerkatBong 115]

1 hour ago, DDD Dad said:

What part of Reich's post was a half truth or misleading?  He merely said that complaining about inflation being at a 40 year high without noting that corporate profits are at 70 year high is misleading.

Reich is definitely on the progressive end of the political spectrum, but his point is fair.  There are many factors contributing for our current inflationary situation.  Let's not ignore that one of those is that corporate profits are outpacing inflation.

The implication being that corporations are price gouging and are big stinky meanies who are twirling their evil mustaches while counting their gold coins is what is stupid.
 

Also, since I’m being critical one way, I’ll be fair about something the other way— using greedflation as a means to 100% deflect blame of inflation as a political tool is really good politicking by the D’s. It’s the one thing they are doing that shows they have the same stomach to get a little dirty politically with messaging, riling up the base, etc.

Also I now see @Felix The Butt hurt Cat has entered the chat. 😂 

Edited November 4, 2022 by MeerkatBong

[Bozo_Casanova 26285]

4 minutes ago, MeerkatBong said:

The implication being that corporations are price gouging and are big stinky meanies who are twirling their evil mustaches while counting their gold coins is what is stupid.

[Bama Chick 28596]

Y’all are are arguing with the latest incarnation of Donkey/Chrispy.

[MC Fresh Breath 4074]

48 minutes ago, Bama Chick said:

Y’all are are arguing with the latest incarnation of Donkey/Chrispy.

Well, now I feel duped.  I do still like the handle name.

[Bama Chick 28596]

Aw, don’t feel duped.

Women have a better creep radar than men.

Evolutionary survival tactic and all.

[Poe It Up 126]

I know for a fact that Chrispy is not Donkey. 

[Incredulity 11555]

Who gives a shit?

 

Except the leftists who think they have laid claim to the surly moral high ground(pun intended)

[DDD Dad 14252]

On 11/4/2022 at 10:12 PM, Poe It Up said:

I know for a fact that Chrispy is not Donkey. 

The only way you could know that is if you were Chrispy….

[TwiceHorn 31287]

Here's the thing, to me.  American consumers have to eat inflation and smile.  Many/most corporations don't, see above.  Inflation doesn't affect them because they can just raise prices to take into account the inflationary increase in their COGS.

They could do two things to mitigate the effects on inflation on consumers:  give an inflationary cost of living increase to their employees, especially lower-paid ones, and hell, it could be temporary; and/or not increase their prices to maintain the same profit as before inflation.

I'm not saying they have to lose money, just not make as much money for a few quarters.  Management could announce that, like the rest of America, we're going to suffer a bit through this period, but at least try to ease the suffering of its employees and customers.  That would be good management and the kind of social responsibility that should be 'murican.  Do unto others, but don't split.

And, I think legally, that is wholly justifiable under the fiduciary duty owed shareholders and the business-judgment rule.  But our current interpretation of fiduciary duty is maximize current short-term profits to the exclusion of virtually any other consideration.  I believe that that is an operational interpretation and not one the courts would impose on management.

I don't believe corporations are driving inflation or a principle cause of it.  But they could do more to mitigate it.  I'm not an economist, but I might guess that if they did something like the above, their sales would increase and they might see better profits off sales volume, depending on the business, from this, without raising prices.

By not doing this, they are benefiting the shareholder class at the expense of consumers.  And, it's not even like they're giving shareholders a COL adjustment, either.  And I'm not sure share price would reflect the reduced profit, the positivity of it and increased sales might maintain or grow.

[softlynow 1784]

47 minutes ago, TwiceHorn said:

Here's the thing, to me.  American consumers have to eat inflation and smile.  Many/most corporations don't, see above.  Inflation doesn't affect them because they can just raise prices to take into account the inflationary increase in their COGS.

They could do two things to mitigate the effects on inflation on consumers:

They don’t have to eat inflation because they don’t fear competition. Decades of kleptocrats eroding anti-trust enforcement, among other things, got us here. 
 

They could do many things, but don’t have to, so they won’t. What they’re motivated to do is funnel money to the would be fascist party to continue us down the path of corporate and oligarchic supremacy, and mostly still do, along with a hedge donation to the slightly less fascist party. Occasionally the fascists act like fascists and big [put literally every industry here] has to lie low for a moment or two. 

[YGIFS 19449]

On 11/4/2022 at 10:23 PM, Incredulity said:

Who gives a shit?

 

Except the leftists who think they have laid claim to the surly moral high ground(pun intended)

I have no moral high ground.  And I am no "leftist"  Some of us just abandoned your team specifically because we have no illusions about having morals.  

I am living just long enough to watch Donald Trump watch one of his children die in prison or from an overdose.  That's all that keeps me warm at night.  

[safe sex 11684]

49 minutes ago, YGIFS said:

I have no moral high ground.

No, voting against fascism gives you at least a couple of inches of moral high ground

[washparkhorn 9935]

The writer is chief economist at UBS Global Wealth Management:

In the world’s financial markets, US Federal Reserve chair Jay Powell is increasingly cast in the role of playground bully — looming over the prostrate form of the global economy and chanting “hike, hike, hike” with malicious glee. US policy rates are rising relentlessly.
 

However, Powell’s public remarks offer little insight into how he expects higher rates to tame inflation. The omission matters as the current policy tightening will have an impact through an unusual route. That is because today’s price inflation is more a product of profits than wages.

Spoiler

Broad-based inflation is normally a labour-cost problem. The rule of thumb is that labour costs are around 70 per cent of the price of a developed economy’s consumer prices. If wage increases are not offset by greater efficiency or reductions in other costs, the consumer will pay a higher price for the labour they are consuming.

With normal inflation, central banks would need to create spare capacity in labour markets to push wages lower.

Wages have been rising but prices have been rising faster, so real wage growth is catastrophically negative. This is far removed from the 1970s-style wage price spiral; apart from the wage and price control debacle of Richard Nixon’s presidency, US real average earnings rose for much of the decade.

The US restaurant and hotel sector helps explain why wage costs have played a limited role in today’s inflation. Since the end of 2019, the average earnings of a worker in this sector have risen just under 20 per cent. But the number of employees has fallen over 5 per cent. Paying fewer people more money means that the sector’s wage bill has risen roughly 13 per cent. The real output of the sector has risen 7 per cent. So US restaurants and hotels are paying fewer people more money to work harder. The rise in wage costs adjusted for productivity since the end of 2019 is somewhere between 5 and 6 per cent. Restaurant and hotel prices have risen 16 per cent.

This is the current inflation story. Companies have passed higher costs on to customers. But they have also taken advantage of circumstances to expand profit margins. The broadening of inflation beyond commodity prices is more profit margin expansion than wage cost pressures.

How is this happening? Two forces have combined. Despite negative real wages, consumers have carried on consuming. Strong post-pandemic household balance sheets have allowed lower savings and increased borrowing to offset the sorry state of real wages. The resulting resilience in demand has given companies the confidence to raise prices faster than costs.

In addition, the power of storytelling has conditioned consumers to accept price rises. Imagine a story about a farmer who takes wheat to the windmill, where it is ground into flour, and then baked into bread. In that fantasy world, a rise in the cost of wheat of say 22 per cent might be used to justify a 15 per cent rise in the price of bread.

TLDR: Financial Times: “Fed should make clear that rising profit margins are spurring inflation

Companies have taken advantage of circumstances to lift prices”