1. So Dr. Pat Deneen on FACEBOOK reminded us that corporate profits are up 161% under Obama. That’s faster than any comparable period since 1900. Pat’s comment: “Some socialist!”
2. Not only that, of course, but the STOCK MARKET is way up under our president. I’m too lazy to look up the exact stats. But I read this morning in the local paper that investors thinking retirement in a couple of decades need to hustle their funds out of bonds and into stocks. The confidence has returned that stocks will whip inflation big-time over the long term, as, of course, they used to do. I have to admit I don’t have that long-term confidence. But what do I know? (Why do people like me need to have inevitably ill-informed opinions on stuff like that? I hate the era of the 401k.)
3. THE WALL STREET JOURNAL had a hugely uncompelling article a week ago justifying the mega-explosion in CEO compensation. We have to properly incentivize those guys to innovatve and disrupt and whatever. There was a sensible letter in the WSJ yesterday explaining that there’s almost no way to know for sure what the CEO contributes to the performance of the corporation etc. Big-time athletes and Adele and Taylor Swift do, in a way, deserve their big bucks: We can see what they did to generate them. In any case, shouldn’t CEOs be motivated more by power and control and enduring legacy than a fabulous amount of money and other perks that they don’t even have time to use well?
4. So, if America is too oligarchic, Obama is one of many causes. He IS the president of Belmont, although Romney actually lived in Belmont. One lesson from the election: Romney’s oligarchs got a beating from Obama’s.
5. The point of all this: How do Republicans campaign against libertarian oligarchic complacency when their major paper, the WSJ, actually shares it? What do Republicans do when it turns out that Obama’s “socialism” is a kind of government that the rich and sophisticated and especially the really rich and sophisticated can believe in (because, for one reason, it has delivered the goods).
January 20th, 2013 | 1:16 pm
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January 20th, 2013 | 3:26 pm
Hmm. My impression has been that the stock market rise is pretty unambiguously due to currency devaluation. I know that making this argument is tough without sounding like sour grapes, but we can still try to be honest about these things.
“What do Republicans do when it turns out that Obama’s “socialism” is a kind of government that the rich and sophisticated and especially the really rich and sophisticated can believe in”
Um, how about get out of the way and let the “crony capitalism” argument of the Tea Party be the party message? Also, hopefully find party leaders who aren’t a) massively wealthy, b) only marginally articulate, c) hopelessly co-opted by crony capitalist/socialistic causes…
January 20th, 2013 | 5:31 pm
Many of the rich (particularly the banks and the management of corporations that benefit from government policy like GE) believe in Obama’s Mussolini-like version of capitalism because it has delivered the goods TO THEM. It is not delivering the goods to most middle-income Americans (aside from public employees). And, from what I have read, there is not much entrepreneurial activity or business expansion going on in this country (aside from “green investments” that receive government subsidies and oil/gas exploration that Obama has not yet had the “flexibility” to snuff out).
On the bright side, I am sure that this administration is doing wonders for corporate “diversity” consultants, as well as lawyers and accountants who help corporations deal with ACA and Dodd-Frank.
January 20th, 2013 | 8:11 pm
America is too oligarchic? Really, now?
Last I checked, Plato divided the democratic regime into three parts: 1) drones (populist spendthrifts and demagogues who flatter the desires of the demos – with socialism?); 2) “oligarchs” (orderly natures skilled at money-making – aka “the drones’ pasture”); and 3) the multitude.
To me, our “oligarchs” look an awful lot like “men whose property is taken away are
compelled to defend themselves by speaking before the people and by doing whatever they can.”
If so, America rests somewhere between democracy and tyranny; not oligarchy and democracy.
January 20th, 2013 | 10:36 pm
djf–of course, I agree. That means, of course, that those hugely overpaid CEOs aren’t doing much real work or real good.
January 21st, 2013 | 10:27 am
Prof Lawler, I agree that the CEOs and other high-level corporate bureaucrats are overpaid (Bob Rubin and, later, Jack Lew at Citibank come to mind), but would having the government force down their salaries result in any real progress on solving the country’s real problems? I doubt it.
January 21st, 2013 | 11:39 am
Of course govt. shouldn’t force down their salaries–the bleepin’ board of directors or whatever should.
January 21st, 2013 | 12:21 pm
Citi received tens of billions in direct bailouts and hundreds of billions of guarantees from the government. Their decision to pay political players millions of dollars to serve as figurehead CEOs is eminently rational, and a great deal for them. Of course “the bleepin’ board of directors” isn’t going to do anything about such sensible hires. This is the sort of “crony capitalism” against which the GOP should stake its future.
If the likes of Jack Lew and Jon Corzine were Republicans, they’d be in prison and be household names. But whining about the injustice of the jackals and vipers in the MSM won’t fix the problem.
January 21st, 2013 | 12:56 pm
Prof Lawler,
There are few things less likely than boards of directors of banks and large corporations cutting their top execs’ salaries without some sort of government compulsion (actual or threatened). The “independent” directors are, for the most part, execs at other companies who don’t want their own salaries cut. Executive compensation is set on the advice of consultants who estimate a “fair market” rate of compensation based on what executives in comparable positions at comparable firms are paid. Nor would I count on board members who are retired politicians, government officials and the like to bite the hands that fed them by putting them on the board (quite a healthy paycheck for showing up at a one or two expense-paid meetings a year – Gerald Ford built himself a fortune after he left the White House just by sitting on boards).
Jack Lew, as much as I despise him, is not a criminal just because he had a gig at Citibank. Apparently, he made no financial decisions of any consequence; he was just a “manager,” and, from what I’ve read, was not paid much compared with what actual senior traders make. Jon Corzine is a different story, of course.
January 21st, 2013 | 12:58 pm
Everything in the last two comments is said well. So how to campaign against crony capitalism (and libertarian complacent indifferent based on FAUX meritocracy)?
January 23rd, 2013 | 9:54 am
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