First, let' begin with a few excerpts from the Fiscal Times (with a few of my notes in brackets) "The Mega-Danger of Mega-Deals: Monopolies Are Crushing U.S. Workers and Consumers" (By David Dayen | November 13, 2015)
This week, the American Medical Association formally asked the Department of Justice to block two health insurance mergers: Aetna’s purchase of Humana and Anthem’s acquisition of Cigna, because that would reduce that industry to effectively three participants.
This week, Anheuser-Busch InBev and SABMiller completed their $106 billion plan to combine, forming the world’s largest brewery, responsible for 30 percent of global beer sales. No less than 11 banks and eight corporate law firms advised on that merger, all earning fees. Just a tiny piece of the $4 trillion in mergers to date this year equals enormous profits for Wall Street.
This week, Apple, Google and Amazon joined forces in a lobbying venture to promote technology-based financial services...at a time when the same tech giants, along with Facebook and Microsoft, have entrenched control over the entire Internet infrastructure. [The Atlantic recently ran a story: Bernie Sanders's Highly Sensible Plan to Turn Post Offices Into Banks]
None of the major-party debates have posed a question about antitrust policy. Republican candidates talk around issues like high drug prices without mentioning that they are the by-products of monopoly. Stories pass through the news — like T-Mobile giving preferential treatment to a handful of companies for streaming services — without any recognition of how large companies get the benefit of a narrow market. [He didn't mention H.J. Heinz Co. and Kraft Foods Group, Inc., among many others, because the list is too long.]
The new Gilded Age allows monopolists to help other monopolists, carving up the pie together and keeping out everyone else. Why should United Airlines or Comcast or AT&T bother to deliver a good product if consumers have no real alternative? [I mentioned Comcast here, because they own NBC, CNBC and MSNBC. Earlier this year Comcast was forced to abandon a Time Warner Cable acquisition after spending more than $400 million on lawyers, lobbyists, and consultants. Two months later Comcast executive vice president David Cohen hosted a $2,700-a-plate fundraiser for Hillary Clinton's presidential campaign.]
Large outsourcing firms can dominate the H-1B visa program, preventing startups from a crack at skilled workers and driving well-paying jobs overseas. Prices rise when monopolies go unchecked. [The New York Times recently ran this story: Large Companies Game H-1B Visa Program, Costing the U.S. Jobs]
Bernie Sanders wants to block the Time Warner/Charter Communications merger. Senators Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.) sent a letter to the FCC accusing big cable companies of using monopoly powers to muscle consumers into paying higher prices. [See my very short post: The Monopolies of Cable TV]
Hillary Clinton has "called" for a merger review of health insurers and said she’ll go after monopoly power in pharmaceuticals. [After Cigna Corp. and Anthem Inc. agreed to deal, she said mergers in the industry deserve more scrutiny. But seeing is believing. And of course, Bernie Sanders has always been critical of the pharmaceutical industry]
Another presidential candidate once talked a good game on antitrust: Barack Obama. But his administration has largely been a huge disappointment. [Because Obama was really a "moderate" pretending to be a "progressive". Hillary Clinton is also a moderate, and just recently started pretending to be a progressive after her secret meeting with Senator Elizabeth Warren last year. Bernie Sanders has ALWAYS been a true progressive.]
We’ve seen periods like this before in America, and they only ended when citizens banded together, from the Granger movement to the Progressive era.
Who and what are Progressives?
Inspired by the legacy of Franklin and Eleanor Roosevelt (who were progressive), the Roosevelt Institute promotes progressive ideas and reimagines America as it should be: a place where hard work is rewarded, everyone participates, and everyone enjoys a fair share of our collective prosperity. FYI: Senator Bernie Sanders is the co-founder of the Congressional Progressive Caucus, which also promotes progressive ideas. Check out their proposed People's Budget.
Earlier this year the Economic Policy Institute (a progressive think tank) did a very thorough analysis of the Congressional Progressive Caucus Budget for Fiscal Year 2016 and found that it would have "significant and positive" impacts on our economy and greatly benefit the working and middle-class. Below are some other recent reports from the EPI:
- Link: Claims of an exploding gig economy are contradicted by the lack of growth of self-employed workforce (By Lawrence Mishel | October 28, 2015)
- Link: Irregular Work Scheduling and Its Consequences (By Lonnie Golden | April 9, 2015)
- Link: Top CEOs Make 300 Times More than Typical Workers (By Lawrence Mishel and Alyssa Davis | June 21, 2015)
- Link: High quality child care is out of reach for working families (By Elise Gould and Tanyell Cooke | October 6, 2015)
- Link: The decline in labor’s share of corporate income since 2000 means $535 billion less for workers (By Josh Bivens | September 10, 2015)
- Link: Disconnect between productivity and a typical worker’s compensation, 1948–2014
- Link: Understanding the Historic Divergence Between Productivity and a Typical Worker’s Pay (By Josh Bivens and Lawrence Mishel | September 2, 2015)
Progressive economic polices (as opposed to neoliberal / trickle-down / starve the beast / free-market economic policies) benefit the working-classes of everyone, no matter how they identify on social issues, be they Democrats, Republicans and Independents. And even Democratic Socialists would fair much better. Just ask anybody that grew up and worked at an average job prior to the mid-1970s — when long-term growth was the norm before the greed of short-term growth took over.
The Greed of Short-Termism
Since its release last week, the Roosevelt Institute's report Agenda to End Short-Termism has been covered by media outlets including The Huffington Post (How Wall Street's Short-Term Fixation Is Destroying The Economy), The Week (The giant corporate money hose to nowhere) and Bloomberg View (How Rich Investors Use All That Buyback Cash). Roosevelt Fellow J.W. Mason also appeared on Bloomberg TV (The Harmful Effects of Buybacks and Short-Term Thinking) to discuss his report.
Corporate short-termism — also known as “quarterly capitalism” — has become a key issue in the 2016 election. It’s also one of the major economic trends that has been increasing inequality and weakening economic growth for the last 35 years. So what is it, how has it transformed American business, and what can we do about it?
The Roosevelt Institute's report is a follow-up report to Rewriting the Rules of the American Economy, and examines how the focus on short time horizons by corporate managers and financial markets has come at the cost of innovation and investment in the long-term health of companies and the middle class.
In another post Understanding Short-Termism: Questions and Consequences, Roosevelt Institute Fellow J.W. Mason responds to those who claim short-termism isn’t a real problem, answering 12 common questions about increased shareholder payouts and their broader economic effects. Click here to download the 32-page report.
In another post Ending Short-Termism: An Investment Agenda for Growth by three Roosevelt Institute Fellows lays out a comprehensive agenda to address this challenge, including direct limits on payouts, a long-term rebalancing of stakeholder power, and a new role for government. Click here to download the 24-page report.
Bernie Sanders and Franklin D. Roosevelt (Two Bold Progressives)
- Link: Bernie Sanders Could be the Next FDR (By Thom Hartmann | July 2, 2015)
- Link: Historical Similarities between FDR and Bernie Sanders (By Students for Bernie Sanders)
- Link: Can Bernie Sanders pull off a Harry Truman on the GOP?
These two videos below from The Big Picture RT explains why Bernie Sanders is more like FDR, a man for the working people — whereas Hillary Clinton (as a moderate Democrat, who's part of the establishment Democratic corporate machine) is little better than the Republicans when it comes to economic issues for the working-class and middle-class.
When people say neoliberalism is good for growth, they tend to be looking at the stock market and executive pay packages, not GDP or workers’ wages. And they certainly aren't talking about infrastructure.
The bailouts during the Great Recession and QE has already been described as the biggest giveaway to the super-rich in the history of the world. Over-taxed? These corporations have been spending trillions of dollars on mergers and acquisitions — as well as on stock buybacks to increase the value of their executive stock-options — and why CEO pay is through the roof.
But yet, very little (if any) of their company's profits are invested in employees’ wages for American workers — because (the CEOs say) raising wages would slow hiring, reduce worker hours, cause layoffs, raise consumer prices, destroy the economy, and end life as we know it on Earth. But what the "job creators" never tell us is, if they were forced to raise workers’ wages, these CEOs might also have to buy one less beachfront mansion, a smaller private jet or a shorter luxury yacht.
Capital gains were once taxed close to 40% in 1979 (now the rate is only 23.8%) — and as a percent of GDP, corporate taxes were also once much higher as well — especially when you consider their "effective" tax rate, which corporations use as a selling point on the "investor relations" pages on their corporate websites and in their annual company reports. But despite all that "free" money they already got, and their already low tax rates, the GOP wants to tax them LESS (as though the super-rich weren't already rich enough).
A study by Faricy alone, examines how exactly the partisan politics of the tax code play out. Faricy, who is an assistant professor of political science and public policy at the Maxwell School of Citizenship and Public Affairs at Syracuse University, has just written a new book, “Welfare for the Wealthy,” examining how the policies of different parties affect inequality. In the paper on tax policy, he examines tax credits (overwhelmingly benefiting the poor) and tax deductions (overwhelmingly benefiting the rich) and looks at how the partisan control of the federal government shifts these benefits.
He finds, “The results of the analysis show that an increase in Democratic power at the federal level produces an immediate decrease in the annual level of total tax deductions that disproportionately benefit the rich, and an increase of federal tax credits, which help the working class.” The study finds that, “A switch to a Democratic president produces an immediate increase of over $83 million in the level of tax credits. This is a substantial increase of over 20% of the average yearly value of total tax credits during this study.” Faricy notes that, “Republicans increase tax deductions that target government money to the wealthy while being able to claim that they are providing middle-class tax relief.”
Whenever online poll results (showing that people overwhelming prefer Bernie Sanders over Hillary Clinton) don't make the mainstream media happy , they manage to find (or conduct) other polls that do make them happy — or they'll lie about them. The corporate-sponsored polls are getting harder and harder to believe. Is it really Hillary's "turn" to be the next President? Does everybody really love Hillary more than Bernie? We know the top percent and wealthy pop stars might love her — even though the online polls showed Bernie won the first Democratic debate by a landslide. And so far, Bernie has also drawn the largest crowds (by far) to his campaign rallies. But despite what seems to be "The People's" choice, the lame stream media, the labor union leaders (despite the wishes of their rank-and-file members), and the establishment politicians are endorsing Hillary over Bernie. That's why Bernie is calling for a "political revolution" — as you can see this happening in this music video I created.
Vote for Bernie Sanders (and progressives in Congress) to end the war on the working-class — or vote for Hillary Clinton for another 35 years of wage stagnation — or vote for a Republican for the total destruction of the working-class.