Who Pays?
There were several questions about who is paying for our mounting buyouts, and of course the answer is you and me. As tax revenues decline, of course, the returns to use up are diminishing. Like U.S. families, the government is losing buying power as income declines along with the value of the dollar, and prices rise.
One interesting suggestion is the extension of insurance categories to include losses due to business malpractice.
The squeal of businesses desperate to avoid any expense while suckling on the public teat can well be anticipated. From 20% of revenues in 2000 the share of tax revenues that business contributes to our national till has declined, but no longer is the actual figure given out. Like all public interests, the business contribution has been severely crimped by right winger government.
The disembowelled public interest has become a casualty that the country can't do without. Without a consumer, there are no sales, a concept so simplistic only the determined ignorance now in power could have refused to acknowledge it. Now sales figures show the effects. Unemployment insurance was devised to set aside some of earnings to insure against the kind of loss that has been visited on workers by sending their jobs abroad.
Simultaneously, our plummeting financial system shows what happens when consumers haven't got the means to supply their basic needs; value is made into no more than a mindgame. There can be insurance against this kind of loss as well.
Businesses cannot afford to ignore the effects of their malfeasance, and should be required to insure against it just as are the workers. It is their own source of income that they are destroying, and the institutions should be guarding against the decimation of wealth that they are creating.
One interesting suggestion is the extension of insurance categories to include losses due to business malpractice.
As venerable American financial institutions topple, the concept of "too big to fail" is being sorely tested. Bear Stearns gets help. Lehman Brothers does not. The Federal Reserve and the Treasury Department are acting like insurance-claims adjusters, selectively providing assistance when a company's failure seems too much for the financial markets to withstand.
Why not make investment banks and other companies pay premiums for this catastrophic-risk insurance? The government already provides flood, bank and crop insurance. Unlike participants in those programs, however, the companies that qualify for "too big to fail" insurance do not pay for the privilege.
Designing this too-big-to-fail insurance would be tricky but feasible. The potential economic impact of financial companies' failure and the risk in their portfolios would have to be evaluated to determine which companies would be required to obtain this protection, and to calibrate premiums.
The goal should be to limit the contagion of failure, rather than to prevent failure itself.
The squeal of businesses desperate to avoid any expense while suckling on the public teat can well be anticipated. From 20% of revenues in 2000 the share of tax revenues that business contributes to our national till has declined, but no longer is the actual figure given out. Like all public interests, the business contribution has been severely crimped by right winger government.
The disembowelled public interest has become a casualty that the country can't do without. Without a consumer, there are no sales, a concept so simplistic only the determined ignorance now in power could have refused to acknowledge it. Now sales figures show the effects. Unemployment insurance was devised to set aside some of earnings to insure against the kind of loss that has been visited on workers by sending their jobs abroad.
Simultaneously, our plummeting financial system shows what happens when consumers haven't got the means to supply their basic needs; value is made into no more than a mindgame. There can be insurance against this kind of loss as well.
Businesses cannot afford to ignore the effects of their malfeasance, and should be required to insure against it just as are the workers. It is their own source of income that they are destroying, and the institutions should be guarding against the decimation of wealth that they are creating.
Labels: Budget; Economy, Bush Legacy, Credit Crunch, Insurance Companies
posted by Ruth at 9:00 AM
1 Comments:
You certainly are a prolific blogger Ruth.
"The disembowelled public interest has become a casualty that the country can't do without. Without a consumer, there are no sales, a concept so simplistic only the determined ignorance now in power could have refused to acknowledge it."
Nah, Ruth, they have not ignored it. Multinationals have other markets from which they can leech their profits. The biggest of which is the 'export' of war.
American citizens are being thrown to the dogs in preparation of the North American Union. By the time the govt has had its way, Americans will be begging for the Amero.
Ever read Naomi Klein...she has some interesting insights into this procedure. You see, desperate people are much more easily managed than a democratic electorate.
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