*** Official Barack Obama FBG campaign headquarters *** (3 Viewers)

[Maurile Tremblay]

Back to the FDA. I know you feel comfortable with USDA inspections of food plants and whatnot, but most of the industry knows these are pretty easy to game.

Sidebar: Everything I Want To Do Is Illegal

 

[Maurile Tremblay]

For the "no regulation" folks like Ivan, Maurile and Rich -- do you think that governments should do away with the corporate form?

It's not an issue I've given much thought to, but I could definitely see doing away with limited liability for tort damages. (I take it that's what you're getting at, rather than mere structure -- e.g., owning shares instead of partnership interests, etc.) That's kind of the situation we already have, since being undercapitalized and underinsured helps with piercing the corporate veil . . .I wouldn't do away with limited liability for contractual damages.

 

[Alias]

breaking news

 

[kaa]

What happened to the Obama thread? I could have sworn it was around here somewhere.

The most interesting aspect of a thread like this is the psychological. When Obama's supporters are quiet or offtopic, its a good bet they aren't happy about his odds of winning. If they start doing backflips about Obama, its a good bet they are happy about his odds of winning. The latest news is Obama might like a compromise on drilling for oil and he might want to eliminate some taxes on senior citizens. Both proposals will upset a typical liberal. They aren't likely to get fired up to talk about them.Typically the republican candidate gets a huge bump in the polls in september or sometimes as late as october. If the usual happens again, this thread could get quiet pretty fast.

 

[bigbottom]

What happened to the Obama thread? I could have sworn it was around here somewhere.

The most interesting aspect of a thread like this is the psychological. When Obama's supporters are quiet or offtopic, its a good bet they aren't happy about his odds of winning. If they start doing backflips about Obama, its a good bet they are happy about his odds of winning. The latest news is Obama might like a compromise on drilling for oil and he might want to eliminate some taxes on senior citizens. Both proposals will upset a typical liberal. They aren't likely to get fired up to talk about them.

There are independent threads on both of those topics. I posted in one of them not an hour ago.

Typically the republican candidate gets a huge bump in the polls in september or sometimes as late as october. If the usual happens again, this thread could get quiet pretty fast.

I posted this a couple pages back.

I'm beginning to think that there is actually a decent shot at a 169-169 electoral vote tie. Taking a look at RCP's electoral college map, Obama is up over McCain 238-163, with 137 toss-up. Of the current toss-up states, I can see Obama taking Michigan and New Mexico, while McCain takes Florida, North Carolina, Missouri, Indiana, Virginia and Ohio. That would give them a 160-160 tie, with Colorado (9), New Hampshire (4), and Nevada (5) hanging in the balance. If one takes Colorado and the other takes New Hampshire and Nevada, we're at a 169-169 tie. Of course, McCain could very well lose Ohio or Virginia and Obama could lose Michigan, which would change everything.)

As for what would happen in the event of a tie, there is a pretty good analysis here.

I also posted this:

Rasmussen and Gallup Tracking have Obama currently at +1. There's no denying that he's falling in national polling.

 

[fightingduck]

No I said the market can't be trusted to police itself. It has proven this on it's own time and again. Our current mortage fiasco is just one more piece of evidence of how all the people calling for less regulation aren't paying attention. But nice spin attempt.

There is a good argument to be made that the current mortgage mess was caused by too much government intervention in the first place, and that a free market would have prevented, or at least minimized, the current problems. In particular, the fact that Fannie Mae and Freddie Mac were "private" companies but implicity backed by the government, allowed them to grow without normal free market restrictions on capital and lending practices.Again, you seem to be missing the point. The debate isn't whether a truly free market is perfect. Even free market proponents stipulate that it isn't. The debate is whether the truly free market is better than the alternatives. In the case of the FDA, there is an argument to be made that the FDA's foot dragging on some new drugs causes more health issues for more people than the free market would cause by "releasing" some drugs too soon.

I didn't see your post first. I'd like to add to your main point here that debate isn't about perfection at this point. In many of these cases we are talking about now, there isn't really a free market at all. NCC makes the point that the free market failed in the mortgage crisis. I'm saying (and I think you make the point better in your first paragraph) that there was no free market in the mortgage business. Competition for capital was non-existant based on government actions. Thus, no incentive to be responsible with that capital. I'm not excusing the players, I'm just saying this was a government-directed misallocation of resources.

I just have to say that I almost totally disagree with this statement....yes FNM and FRE got capital at below free market rates, but almost all those mortgages were fixed rate instruments of less than $435K (or whatever the figure is). At the margin we a quarter point difference (ior whatever it is) doesn't create the bubble.

Actually, at the margin is where this happens. For the record, it's a bit more than a quarter, but in any case, Fran and Fred is able to squeeze everyone else out. No one else can do what they do because a normal company faces a ceiling on the amount of debt it can get. A normal company would face incremental debt costs. F/F do not face these costs. The issue isn't a quarter of a point on one loan - the issue is that F/F are the only institutions that the market would allow to have $1.0 trillion on debt on its books. Here a good article from a guy that used to consult for them: The Golden Goose

The vast majority of the mortgage problems occurred in the free market realm (where there is basically no regulation) as firms like CFC created these exotic mortgages, home equity lines, etc that they then immediately sold on to I-banks to package in CDOs.

From CFC's last 10-k (page 3):The majority of our loan production consists of Prime Mortgage Loans. Prime Mortgage Loans include conventional mortgage loans, loans insured by the Federal Housing Administration ("FHA") and loans guaranteed by the Veterans Administration ("VA"). A significant portion of the conventional loans we produce qualify for inclusion in guaranteed mortgage securities backed by Fannie Mae or Freddie Mac ("conforming loans").

"a majority" means 94%.

CDO's can be anything and, yes, the I-banks came up with some crazy stuff, but the mortgage problem is mostly government sponsered entities.

The big problem here is what CFC called "prime," really wasn't prime. F/F bought it anyway, demonstrating that the government is poor at counter-party surveillance when it has a political interest (home ownership) that it rates higher than its financial interest (since it can print as much money as it wants).

The system broke-down b/c the no one in the system cared about individual credit quality, but instead made mathematical inferences based on history on how different pools would perform over time. That's where the "free market" brokedown as no one cared what they were doing.

Yes, no one cared. "no one" being Fran&Fred.

 

[fatguyinalittlecoat]

I wouldn't do away with limited liability for contractual damages.

Why not?

 

[adonis]

The free market to me is a lot like natural selection. Brutally efficient overall, but little to no regard for those affected.

To me, an unregulated free market would be brutally efficient, but there would be many people screwed in the process.

The key to regulation, again for me, is to harness the power and efficiency of the free market, while also trying to prevent people from getting screwed.

It's like what we do with medicine. Many kids, whom natural selection (absent medicine) would've selected to not propagate their genes, have new shots at life. Does this ruin some of the beauty of natural selection? Absolutely, as the end product isn't the most adapted humans being born, but instead natural selection is infused with humanity and I think we're happier for it, in many ways. However, with rampant use of anti-biotics, and new diseases and viruses mutating as we speak, the possibility might arise that the good we think we're doing with medicine and all, might actually end up making all of us more prone to disease at some later stage.

The free market and natural selection are both efficient and powerful, but if each is left unregulated, people suffer.

 

[RCon]

Adonis, while all of that is true, it misses the point made above. Free markets aren't perfect, and do leave some people out in the cold. However, there are times when government regulation (the alternative to free markets) leaves even more people out in the cold. Fannie Mae and FDA are examples where the argument can be made that the current government imposed restrictions are even worse for many people than the free market would have been.

 

[fightingduck]

There is a good argument to be made that the current mortgage mess was caused by too much government intervention in the first place, and that a free market would have prevented, or at least minimized, the current problems. In particular, the fact that Fannie Mae and Freddie Mac were "private" companies but implicity backed by the government, allowed them to grow without normal free market restrictions on capital and lending practices.

What are the "normal free market restrictions"?

In this particular case, although Fannie and Freddie are/were purportedly private companies, they had an implicit backing of the government for their debts (i.e. if they went bankrupt, the govt would cover the debts). This allowed them to borrow and lend at lower rates than competitors, thus growing at a rate much larger than if they had been subject to the same free market rates as other firms.To answer your question above, yes, government backing removed risk for those companies.

I can sse that - but I guess I'm just not connecting that to the argument against regulation. The "cause" seems too far removed for me. Poor lending practices caused it, imho. Now if the govt backing of Fannie Mae contributed to the environment in which these poor decisions were made - ok. Streets don't cause car wrecks.

You're correct that poor lending practices were the primary cause for this. The question is how best to regulate lending practices. A bank that holds a mortgage on their books faces the risk of capital loss - for whatever it's worth, the bank should care about its lending practices with its own dime on the line. A bank that sells its loan to another financial institution is regulated by counter-party surveillance (i.e., the bank that buys the loan has every incentive to check out the originating bank's lending practices. When the buyer is a GSE (e.g., fred & Fann), their incentive to perform the oversight is not the same - since their money is cheap and guaranteed.I-banks are not immune from critcism here. The joined the party at taxpayer expense also. Simply, the incentive to check the underlying asset (which is normally done in the free market) was removed by the government taking on the risk itself. The government did nothing about it since half of Congress gets greased by Fan and Fred.

 

[adonis]

Adonis, while all of that is true, it misses the point made above. Free markets aren't perfect, and do leave some people out in the cold. However, there are times when government regulation (the alternative to free markets) leaves even more people out in the cold. Fannie Mae and FDA are examples where the argument can be made that the current government imposed restrictions are even worse for many people than the free market would have been.

And I agree with the point, but I was reiterating the idea that I think the solution is a free market and government regulation, as little as possible.I guess I'm still on the quote where someone said "the free market is always the best solution." Not all government regulation is the same, and while some forms of government regulation might leave more people out in the cold (like the FDA has been suggested to do) than the free market alone, I believe that the free market must be regulated in order to serve the american people without causing much problems. It's also true that the government should be pushed back as much as possible in their efforts to regulate the free market, and some sort of balance should be struck that is optimal, but promoting either side as the "best solution" is folly, imo.

 

[fightingduck]

For the "no regulation" folks like Ivan, Maurile and Rich -- do you think that governments should do away with the corporate form?

It's not an issue I've given much thought to, but I could definitely see doing away with limited liability for tort damages. (I take it that's what you're getting at, rather than mere structure -- e.g., owning shares instead of partnership interests, etc.) That's kind of the situation we already have, since being undercapitalized and underinsured helps with piercing the corporate veil . . .I wouldn't do away with limited liability for contractual damages.

Prettu sure this would kill capital formation as we know it today. You sure?

 

[Sweet J]

For the "no regulation" folks like Ivan, Maurile and Rich -- do you think that governments should do away with the corporate form?

It's not an issue I've given much thought to, but I could definitely see doing away with limited liability for tort damages. (I take it that's what you're getting at, rather than mere structure -- e.g., owning shares instead of partnership interests, etc.) That's kind of the situation we already have, since being undercapitalized and underinsured helps with piercing the corporate veil . . .I wouldn't do away with limited liability for contractual damages.

Prettu sure this would kill capital formation as we know it today. You sure?

Look who is in favor of regulation all of a sudden. . . color me shocked.

 

[ffldrew]

Obama heals hundreds AUSTIN — Ginny McCallum, 43, who has been confined to a wheelchair for much of her adult life, came to hear presidential candidate Barack Obama speak at the University of Texas. Afterward she found herself in a wheelchair access breezeway as Obama and his entourage exited the arena. The candidate spotted her, came over, grabbed her hand and pulled her up. She found herself standing for the first time in eleven years. "He smiled at me and said, ‘Yes, you can,’" she says. "I was so stunned I didn’t know what to do." McCallum is among hundreds of people who say they have been healed by the Democratic candidate, in one of the most surprising and little-acknowledged aspects of his campaign. Reporters have shied away from the story, chalking it up to "Obama-mania" and people’s feelings of elation. "We don’t talk about it a lot, but yeah, it does happen," says one staffer who says he has seen multiple people healed on a rope line. "We don’t know exactly how or why it’s happening, and the Senator won’t talk about it. He usually insists that people keep it quiet and just report it to their pastor or priest." Greeting supporters after a rousing speech in Houston, Obama stepped into the dense crowd and spontaneously began touching people: a legally blind woman, a man deaf in one ear, a cancer sufferer and a lame man. "Yes, you can," Obama said as he laid hands on afflicted bodies. The people’s reactions were so joyous as to be almost frightening. They jumped and shouted and wept. Before they could thank or embrace the candidate he was well down the rope line healing others. Their excitement was lost in the general din of the crowd. Aides acknowledge that the phenomenon is occurring with greater frequency. "His power goes beyond simple inspiration," says one aide. "There is something developing here that I’m not sure any of us fully understands." They say Obama has told them privately that his time has not yet come, so it would be inappropriate to talk about the healings right now. He says he will wait until the convention to speak publicly about the "special calling" he believes he has to lead the country. They do expect him to start alluding to "the providential nature of what is happening on the campaign trail" in an upcoming address, mostly because word is getting around. People have begun bringing relatives by the score to campaign events in hopes of a healing touch. "It’s not the speeches that are drawing people anymore, as good as they are," says a senior staff member. "It’s people wanting to get better, and wanting their friends and relatives to get better. It’s the belief that there’s something more here." •

 

[Maurile Tremblay]

I wouldn't do away with limited liability for contractual damages.

Why not?

It doesn't matter too much one way or the other because people can contract around whichever rule is chosen. If the default rule is that shareholders can be held personally liable for the contractual debts of the corporation, any contract itself can specify otherwise. And if the default rule is limited liability, the shareholders can give personal guarantees.I just kept limited liability as the default because that's the current rule and I don't see a reason to change it (regarding contractual liability); but really, flip a coin.

 

[Maurile Tremblay]

For the "no regulation" folks like Ivan, Maurile and Rich -- do you think that governments should do away with the corporate form?

It's not an issue I've given much thought to, but I could definitely see doing away with limited liability for tort damages. (I take it that's what you're getting at, rather than mere structure -- e.g., owning shares instead of partnership interests, etc.) That's kind of the situation we already have, since being undercapitalized and underinsured helps with piercing the corporate veil . . .I wouldn't do away with limited liability for contractual damages.

Prettu sure this would kill capital formation as we know it today. You sure?

I don't think it would significantly change anything. Unintentional torts are insurable, and intentional torts tend to give rise to personal liability (on the part of the tortfeasor) anyway. (We'd want to keep "respondeat superior" somewhat limited, though, I think. If a mom and pop pizza place hires a driver who shoots someone in a bout of road rage while he is on duty, I wouldn't want the owners of the shop to be held personally liable.)

 

[fightingduck]

For the "no regulation" folks like Ivan, Maurile and Rich -- do you think that governments should do away with the corporate form?

It's not an issue I've given much thought to, but I could definitely see doing away with limited liability for tort damages. (I take it that's what you're getting at, rather than mere structure -- e.g., owning shares instead of partnership interests, etc.) That's kind of the situation we already have, since being undercapitalized and underinsured helps with piercing the corporate veil . . .I wouldn't do away with limited liability for contractual damages.

Pretty sure this would kill capital formation as we know it today. You sure?

Look who is in favor of regulation all of a sudden. . . color me shocked.

Yes, I'm in favor of the government protecting private property and enforcing private contracts. I don't think I've ever proposed anarchy.Regulation in the sense that we've been discussing is quite different (FDA & lending practices, not to mention the really dumb ones like SARBOX). Allowing & protecting a corporate form is not the same as telling a corporation what it must do.

 

[fightingduck]

For the "no regulation" folks like Ivan, Maurile and Rich -- do you think that governments should do away with the corporate form?

It's not an issue I've given much thought to, but I could definitely see doing away with limited liability for tort damages. (I take it that's what you're getting at, rather than mere structure -- e.g., owning shares instead of partnership interests, etc.) That's kind of the situation we already have, since being undercapitalized and underinsured helps with piercing the corporate veil . . .I wouldn't do away with limited liability for contractual damages.

Prettu sure this would kill capital formation as we know it today. You sure?

I don't think it would significantly change anything. Unintentional torts are insurable, and intentional torts tend to give rise to personal liability (on the part of the tortfeasor) anyway. (We'd want to keep "respondeat superior" somewhat limited, though, I think. If a mom and pop pizza place hires a driver who shoots someone in a bout of road rage while he is on duty, I wouldn't want the owners of the shop to be held personally liable.)

Obvisouly, I'm no lawyer, but I don't currently see any capital flowing to partnerships or sole proprietorships (which is why you typically see these forms in the professional services world only - as they have limited capital needs). If it's not an LLC, or chapter corp, the entity has a problem raising outside capital. I've always assumed limited liability was the primary reason for this. If your answer is insurance, then you're, at a minimum, raising the cost of investing, just like SARBOX raised the cost to be a director and a public company. The result might be a flight of capital. (Maybe we ought not talk about this or the anti-capitalists on the board might get new ideas.)

 

[flufhed]

Obama heals hundreds AUSTIN — Ginny McCallum, 43, who has been confined to a wheelchair for much of her adult life, came to hear presidential candidate Barack Obama speak at the University of Texas. Afterward she found herself in a wheelchair access breezeway as Obama and his entourage exited the arena. The candidate spotted her, came over, grabbed her hand and pulled her up. She found herself standing for the first time in eleven years. "He smiled at me and said, ‘Yes, you can,’" she says. "I was so stunned I didn’t know what to do." McCallum is among hundreds of people who say they have been healed by the Democratic candidate, in one of the most surprising and little-acknowledged aspects of his campaign. Reporters have shied away from the story, chalking it up to "Obama-mania" and people’s feelings of elation. "We don’t talk about it a lot, but yeah, it does happen," says one staffer who says he has seen multiple people healed on a rope line. "We don’t know exactly how or why it’s happening, and the Senator won’t talk about it. He usually insists that people keep it quiet and just report it to their pastor or priest." Greeting supporters after a rousing speech in Houston, Obama stepped into the dense crowd and spontaneously began touching people: a legally blind woman, a man deaf in one ear, a cancer sufferer and a lame man. "Yes, you can," Obama said as he laid hands on afflicted bodies. The people’s reactions were so joyous as to be almost frightening. They jumped and shouted and wept. Before they could thank or embrace the candidate he was well down the rope line healing others. Their excitement was lost in the general din of the crowd. Aides acknowledge that the phenomenon is occurring with greater frequency. "His power goes beyond simple inspiration," says one aide. "There is something developing here that I’m not sure any of us fully understands." They say Obama has told them privately that his time has not yet come, so it would be inappropriate to talk about the healings right now. He says he will wait until the convention to speak publicly about the "special calling" he believes he has to lead the country. They do expect him to start alluding to "the providential nature of what is happening on the campaign trail" in an upcoming address, mostly because word is getting around. People have begun bringing relatives by the score to campaign events in hopes of a healing touch. "It’s not the speeches that are drawing people anymore, as good as they are," says a senior staff member. "It’s people wanting to get better, and wanting their friends and relatives to get better. It’s the belief that there’s something more here." •

I love the "Obama is the Messiah." I mean, really, the fact that lots of people really think he is awesome is the best people can come up with to attack him? I'll take that any day.

 

[Maurile Tremblay]

Obvisouly, I'm no lawyer, but I don't currently see any capital flowing to partnerships or sole proprietorships (which is why you typically see these forms in the professional services world only - as they have limited capital needs). If it's not an LLC, or chapter corp, the entity has a problem raising outside capital. I've always assumed limited liability was the primary reason for this.

If you're going to start a Serious Business, there's really no reason right now not to make it a corporation or LLC. My guess: it's not so much that partnerships and sole proprietorships inherently have trouble raising capital for large-scale business ventures; it's that any large-scale business venture is going to become a corporation or LLC. (Obviously, if we're talking about equity instead of debt, a sole proprietorship cannot raise capital while remaining a sole proprietorship.) If corporations were treated like partnerships w/r/t liability issues, I think you'd see a lot more capital-worthy business ventures remain partnerships rather than corporations, and thus you'd see a lot more partnerships getting capital.There are a bunch of SEC regulations that come into play here as well, but I don't know anything about that area.

 

[IvanKaramazov]

Sure, a company might sign a contract with a distributor for a lower price, to drive off the competition, but once the competition is run out of business, and the main company gains market share, they can renegotiate their contracts at a higher price. What's stopping them? Assuming of course the people need their products.

The kind of predatory pricing you're describing has been refuted in theory (originally by Aaron Director, I believe), and has never been observed in practice. The simplest theoretical argument against predatory pricing is the observation that, if both large and small firm have the same costs and the large firm drives the price below cost, then the large firm, with its larger sales, is losing money much faster than the small firm. (If the large firm has lower costs it can drive out the smaller without predatory pricing by charging a price above its cost but below its rival's cost.)Indeed, if the large firm has 95% of the market and the small firm 5%, the large firm is losing more than 19 times as fast as the small, both because the large has to sell even more to accommodate the larger demand due to the lower price (if it doesn't the price goes back up) and because the small firm can, and the larger cannot, reduce losses by temporary output cuts. So the big firm goes broke first.

Here are a few other theoretical arguments as to why predatory pricing isn't really that big a deal:

1. If the "prey" would be profitable in the absence of predatory pricing, why don't people loan it funds to keep it afloat until the "predator" is tired of losing money hand over fist? Lenders should be able to make a nice rate of return by loaning funds to a profitable enterprise.

It's possible that this could happen, but it reminds me of a market saying: "The market can stay irrational longer than you can stay liquid." If we're talking huge companies here, I'm not sure it'd be a worthwhile gamble to continue to loan money to a smaller company, with fewer resources, being pushed out of business due to shady deals and artificially lower prices on the hope that the loaned money will keep you afloat long enough to run through the deep pockets of the huge business.

In other words, the big business can likely outlast infusions of cash to the small company, and even having more cash won't necessarily help due to exclusive deals, and other monopolistic practices. There's no guarantee their product will end up being superior either, although in some cases I could see how this might work.

2. Even if the predator succeeds in driving one particular competitor out of the market, what's to stop that firm from re-entering once the incumbent raises its price? For example, let's say I own a firm that produces oak dinette sets. My competitor starts selling his product below cost, making it impossible for me to compete. No problem. I just switch over to making oak office furniture. Once my former competitor raises his price, I start making dinette sets again. Or some other firm that makes dinette sets enters the market. It's not like the predator gets the market all to itself for all eternity just because it ran off one potential competitor.

There are significant barriers to entry in quite a few markets. Many, like you suggest, won't apply to my example because like you said, they could just come back in. But things like operating systems, or high-tech security software/hardware, or other things that get well-established in a system, or have terribly high R&D costs to develop a product would be particularly vulnerable.

3. If big firms can successfully drive small competitors (who would be otherwise-profitable) out of business through predatory pricing, then how come big firms don't enter those markets to grab those profits instead? For example, many people accuse WalMart of driving mom-and-pop hardware stores out of business through predation. I don't think that's what's going on, but let's grant that just for the sake of argument. Mom & Pop Co. may not have enough funds to survive WalMart's predatory pricing, but Lowes and Home Depot certainly do. Predatory pricing doesn't make any sense if WalMart just swaps a big competitor for a small competitor.

I don't think Walmart is guilty of predatory pricing. They have efficient systems, and pay their workers little with few benefits. Their efficiency, IT infrastructure, and pay structure where few if any are full time and receive benefits, allow them to sell for lower prices. I think it'd be hard for mom & pop stores to match their efficiency, but I wouldn't say that it is a bad tactic they're using. They're just beating their competitors, but others, like you mentioned, other bigger stores can compete, but the margins become smaller and smaller for them as they compete on volume, or try to find some other niche other than being the lowest price.

Notice that in order for predatory pricing to work (or even make sense), all of the conditions you posited have to hold. The predator has to have a much larger cash reserve than the prey and the prey can't have access to capital markets and reetntry needs to be impossible and there can't be any big firms interested in entering the market. That's quite a parlay, which is what I meant about how most economists don't lose a lot of sleep over predatory pricing.

 

[IvanKaramazov]

For the "no regulation" folks like Ivan, Maurile and Rich -- do you think that governments should do away with the corporate form?

I'm nowhere near familiar enough with corporate law to have a strong opinion on this. Also, for the record, I'm not in favor of "no regulation." To go back to an earlier example, I'm cool with having an FDA as long as it mainly restricts itself to preventing fraud and generating information. For example, if a company is going to call its product "aspirin," I have no problem with the government checking to make sure that the pill is really acetylsalicylic acid, no more and no less. Likewise, if a company claims that its drug will lower cholesterol levels, I'm fine with having the FDA require some evidence for that claim before the firm can make it. That kind of thing just falls under the general category of fraud prevention, which most free-marketeers see as a legitimate role of government. What I'm not fine with is having the FDA tell me that I can't take Viagra for recreational purposes. I'm also not fine with the FDA telling patients that they can't choose to take experimental drugs after fully informing themselves of the benefits and risks involved.

 

[kaa]

For the "no regulation" folks like Ivan, Maurile and Rich -- do you think that governments should do away with the corporate form?

I'm nowhere near familiar enough with corporate law to have a strong opinion on this. Also, for the record, I'm not in favor of "no regulation." To go back to an earlier example, I'm cool with having an FDA as long as it mainly restricts itself to preventing fraud and generating information. For example, if a company is going to call its product "aspirin," I have no problem with the government checking to make sure that the pill is really acetylsalicylic acid, no more and no less. Likewise, if a company claims that its drug will lower cholesterol levels, I'm fine with having the FDA require some evidence for that claim before the firm can make it. That kind of thing just falls under the general category of fraud prevention, which most free-marketeers see as a legitimate role of government. What I'm not fine with is having the FDA tell me that I can't take Viagra for recreational purposes. I'm also not fine with the FDA telling patients that they can't choose to take experimental drugs after fully informing themselves of the benefits and risks involved.

That was another straw man. No-one in this thread said everything should be unregulated, but fatguy started out with a false premise that someone did, and then argued from that point. That's why its so hard to debate things - people are playing games instead of taking an honest look.

 

[kaa]

I love the "Obama is the Messiah." I mean, really, the fact that lots of people really think he is awesome is the best people can come up with to attack him? I'll take that any day.

You don't understand the objective. McCain knows that if this election is referendum on Bush, he's gonna lose. However, if this is a referendum on Obama, he's gonna win. Anything to set the focus on Obama is good for McCain.

 

[kaa]

You can bet if Hillary was the nominee, every damn speech would be about Bush. She could say things like "We moved on from a Bush to a Clinton in 92 and things got better, let's do the same thing in 2008."

 

[IvanKaramazov]

I love the "Obama is the Messiah." I mean, really, the fact that lots of people really think he is awesome is the best people can come up with to attack him? I'll take that any day.

You don't understand the objective. McCain knows that if this election is referendum on Bush, he's gonna lose. However, if this is a referendum on Obama, he's gonna win. Anything to set the focus on Obama is good for McCain.

It doesn't even have to be a referendum on Bush for McCain to lose. So much stuff is running the Democrat's way these days that if McCain was running against "Democrat TBA" he would almost certainly lose. His only hope of victory is persuade voters that Obama isn't an acceptable Democrat; he has to turn the race into a referendum on Obama. Even then, it's still tough sledding because Obama's a pretty appealing guy at first glance.

 

[NorvilleBarnes]

I love the "Obama is the Messiah." I mean, really, the fact that lots of people really think he is awesome is the best people can come up with to attack him? I'll take that any day.

You don't understand the objective. McCain knows that if this election is referendum on Bush, he's gonna lose. However, if this is a referendum on Obama, he's gonna win. Anything to set the focus on Obama is good for McCain.

It doesn't even have to be a referendum on Bush for McCain to lose. So much stuff is running the Democrat's way these days that if McCain was running against "Democrat TBA" he would almost certainly lose. His only hope of victory is persuade voters that Obama isn't an acceptable Democrat; he has to turn the race into a referendum on Obama. Even then, it's still tough sledding because Obama's a pretty appealing guy at first glance.

And I don't think Obama is stupid. It doesn't look like he's going to just stand around and let himself get swift-boated.

 

[kaa]

I love the "Obama is the Messiah." I mean, really, the fact that lots of people really think he is awesome is the best people can come up with to attack him? I'll take that any day.

You don't understand the objective. McCain knows that if this election is referendum on Bush, he's gonna lose. However, if this is a referendum on Obama, he's gonna win. Anything to set the focus on Obama is good for McCain.

It doesn't even have to be a referendum on Bush for McCain to lose. So much stuff is running the Democrat's way these days that if McCain was running against "Democrat TBA" he would almost certainly lose. His only hope of victory is persuade voters that Obama isn't an acceptable Democrat; he has to turn the race into a referendum on Obama. Even then, it's still tough sledding because Obama's a pretty appealing guy at first glance.

The last truly good poll was the Gallup likely poll that showed McCain +4. That's where I think the race is right now. And its only going to get worse for Obama because in fact a lot of things are running the republicans way right now. McCain is a VERY strong candidate and he's run an outstanding campaign. Of course, the dems will never admit that and over the years I've lost count of the number of times the republican pundits fail to understand how to win, and therefore think their guy is running a bad campaign.

 

[NCCommish]

The reason there is even an FDA is that rampant mislabeling and adulteration of both food and drugs were all to commonplace in this country.

The reason there is even a War on Drugs is yadda yadda.Just because there's a purported reason for something doesn't mean that it was a good idea or that it has done (or continues to do) more harm than good.

And just because it's the Feds doesn't mean it's a bad idea or that it has done no good.

 

[NCCommish]

What happened to the Obama thread? I could have sworn it was around here somewhere.

The most interesting aspect of a thread like this is the psychological. When Obama's supporters are quiet or offtopic, its a good bet they aren't happy about his odds of winning. If they start doing backflips about Obama, its a good bet they are happy about his odds of winning. The latest news is Obama might like a compromise on drilling for oil and he might want to eliminate some taxes on senior citizens. Both proposals will upset a typical liberal. They aren't likely to get fired up to talk about them.Typically the republican candidate gets a huge bump in the polls in september or sometimes as late as october. If the usual happens again, this thread could get quiet pretty fast.

I haven't seen the tax plan but I like the drilling compromise. BTW I don't know what a typical liberal is (although I am sure you do) but I can't imagine too many of them getting upset about tax breaks for seniors.

 

[kaa]

The reason there is even an FDA is that rampant mislabeling and adulteration of both food and drugs were all to commonplace in this country.

The reason there is even a War on Drugs is yadda yadda.Just because there's a purported reason for something doesn't mean that it was a good idea or that it has done (or continues to do) more harm than good.

And just because it's the Feds doesn't mean it's a bad idea or that it has done no good.

No you are wrong its quite clear that the free market is superior to government control.

 

[NCCommish]

The reason there is even an FDA is that rampant mislabeling and adulteration of both food and drugs were all to commonplace in this country.

The reason there is even a War on Drugs is yadda yadda.Just because there's a purported reason for something doesn't mean that it was a good idea or that it has done (or continues to do) more harm than good.

And just because it's the Feds doesn't mean it's a bad idea or that it has done no good.

No you are wrong its quite clear that the free market is superior to government control.

No it isn't even a little clear. It is very murky. Every time something get deregulated like you guys want it leads to a fiasco. Take Enron for example. They took adavantage of lax oversight following deregulation. Look where that got us. But I guess it's alright because you weren't one of the people that lost everything or got screwed over by the artifically high prices.

 

[Bottomfeeder Sports]

...The breakdown that I see if the federal bailout of Fannie and Freddie with taxpayer money.

I agree that this is government interference in the free market, but I am at a complete loss at how you equate government guarantees as government regulation. The head line problems we've had over the past thirty years tend to come from relaxing the regulations that had accompanied these guarantees. Again government interference, but regulation?

 

[Bottomfeeder Sports]

No you are wrong its quite clear that the free market is superior to government control.

A mixed model that strives for the elusive balance seems to have been demonstrated as superior to either as evident by the 20th US economy.

 

[Homer J Simpson]

I love the "Obama is the Messiah." I mean, really, the fact that lots of people really think he is awesome is the best people can come up with to attack him? I'll take that any day.

You don't understand the objective. McCain knows that if this election is referendum on Bush, he's gonna lose. However, if this is a referendum on Obama, he's gonna win. Anything to set the focus on Obama is good for McCain.

It doesn't even have to be a referendum on Bush for McCain to lose. So much stuff is running the Democrat's way these days that if McCain was running against "Democrat TBA" he would almost certainly lose. His only hope of victory is persuade voters that Obama isn't an acceptable Democrat; he has to turn the race into a referendum on Obama. Even then, it's still tough sledding because Obama's a pretty appealing guy at first glance.

The last truly good poll was the Gallup likely poll that showed McCain +4. That's where I think the race is right now. And its only going to get worse for Obama because in fact a lot of things are running the republicans way right now. McCain is a VERY strong candidate and he's run an outstanding campaign. Of course, the dems will never admit that and over the years I've lost count of the number of times the republican pundits fail to understand how to win, and therefore think their guy is running a bad campaign.

Yep. The last good poll was the only one out of 8000 polls that actually has McCain ahead.

 

[Arsenal of Doom]

I thought this was an interesting poll today: 62% believe that Social Security tax should be paid on all or most income

I'm not surprised that more favor it, but thought it would be a little closer. That's pretty close to the 64% who apparently support offshore drilling now. Maybe they should vote on both when congress comes back into session?

 

[Arsenal of Doom]

I'm going through some analysis from the Tax Policy Center, who did a late July update on their projections of the candidates tax plans. Here's some good data:

Both candidates prefer to compare their plans to the “current policy” baseline, which would extend the 2001 and 2003 tax cuts and indefinitely extend an indexed AMT “patch.” Against that baseline, Obama would raise revenues by about $800 billion over the decade, while McCain would lose $600 billion. But choice of baseline doesn’t change how the proposals would affect the budget picture; without substantial cuts in government spending, both plans would sharply increase the national debt. Including interest costs, Obama would boost the debt by $3.4 trillion by 2018. McCain would increase the debt by $5 trillion.

The Obama plan would reduce taxes for low- and moderate-income families, but raise them significantly for high-bracket taxpayers. By 2012, middle-income taxpayers would see their after-tax income rise by 4.6 percent, or $2,100 annually. Those in the top 1 percent would face an average tax increase of about $38,000, cutting their after-tax income by 2.9 percent.

McCain would reduce taxes an average of about 3 percent of income, or about $1,400 annually, for middle-income taxpayers by 2012. But, in sharp contrast to Obama, he would cut taxes for those in the top 1 percent by $127,000, raising their after-tax income an average 9.5 percent.

These projections are built on descriptions of the candidates’ plans provided by senior McCain and Obama staff. However, TPC has also projected costs based upon what candidates have actually said on the campaign trail, and those promises paint a quite different picture.

For instance, TPC estimates that one version of McCain’s proposal to create an optional simplified individual income tax system would increase the cost of his plan by more than $1 trillion over 10 years. McCain has provided few details for his plan, but TPC projected the costs of a similar proposal made by the Republican Study Committee.

All told, the “stump version” of Senator McCain’s plan would cut taxes by almost $7 trillion over the ten-year budget period and cut taxes to their lowest level in 50 years.

Obama has proposed raising the payroll tax for those earning over $250,000. Again, he has not provided details, but TPC assumes this would be a 2 percent income tax surcharge on adjusted gross income above $250,000 and an additional 2 percent payroll tax for employers on each worker’s earnings above that level. Such a plan would increase taxes on high-income workers by nearly $400 billion over a decade.

In the latest update of its analysis, TPC has added a preliminary estimate of the candidates’ health care proposals. Because the campaigns did not provide complete plans, TPC had to assume many details. We conclude that the McCain plan, which would replace the current exclusion for employer-paid premiums with a refundable income tax credit of up to $5,000 for anyone purchasing health insurance and make other changes to the healthcare system, would increase the deficit by $1.3 trillion over 10 years and modestly trim the number of uninsured. The Obama plan, which would make relatively low-cost insurance available to everyone through non-group pools and subsidize premiums for low- and moderate-income households, would cost $1.6 trillion, but would also cover virtually all children and many currently uninsured adults.

 

[RCon]

...The breakdown that I see if the federal bailout of Fannie and Freddie with taxpayer money.

I agree that this is government interference in the free market, but I am at a complete loss at how you equate government guarantees as government regulation. The head line problems we've had over the past thirty years tend to come from relaxing the regulations that had accompanied these guarantees. Again government interference, but regulation?

Pot-AY-to, Pot-AH-to...Basically, the mess was largely caused by the government, not the free market.

 

[Clayton Gray]

I love the "Obama is the Messiah." I mean, really, the fact that lots of people really think he is awesome is the best people can come up with to attack him? I'll take that any day.

You don't understand the objective. McCain knows that if this election is referendum on Bush, he's gonna lose. However, if this is a referendum on Obama, he's gonna win. Anything to set the focus on Obama is good for McCain.

It doesn't even have to be a referendum on Bush for McCain to lose. So much stuff is running the Democrat's way these days that if McCain was running against "Democrat TBA" he would almost certainly lose. His only hope of victory is persuade voters that Obama isn't an acceptable Democrat; he has to turn the race into a referendum on Obama. Even then, it's still tough sledding because Obama's a pretty appealing guy at first glance.

The last truly good poll was the Gallup likely poll that showed McCain +4. That's where I think the race is right now. And its only going to get worse for Obama because in fact a lot of things are running the republicans way right now. McCain is a VERY strong candidate and he's run an outstanding campaign. Of course, the dems will never admit that and over the years I've lost count of the number of times the republican pundits fail to understand how to win, and therefore think their guy is running a bad campaign.

Yep. The last good poll was the only one out of 8000 polls that actually has McCain ahead.

 

[timschochet]

Limbaugh predicts landslide for McCain?

RUSH: See, the liberals have to blame this Russian attack on Georgia on Bush, and then, by association, McCain, otherwise Obama has no chance. I don't think he has much of a chance, and I think the dirty little secret is that McCain could win this in a landslide. I actually do. I think there is so much huff and puffery here about Obama, and the bloom has long ago gone off that rose. It happened during the Democrat primaries. Thomas Sowell has a great column. He once attended a course taught by John Kenneth Galbraith, the noted liberal economist, and he came in and did his first lecture to the class, and it was so good they all stood up and applauded, but every other lecture was just more and more generalities on the first lecture, and as the course went on, the class kept dwindling in size and finally people stopped showing up because there was no substance. That's exactly what's happened to Obama. His first speech, his first series of appearances: "Oh, man, new, unique, messiah, change, hope, future." But now there's no substance. You can revive the old Fritz Mondale question of Gary Hart(pence), "Where's the beef?" And it's happening, folks. I'm telling you, it's happening. There are all kinds of doubts throughout the Democrat Party about this guy, 143 days in the Senate, for crying out loud. He's a neighborhood activist; he's a street activist that they have nominated.

 

[adonis]

Notice that in order for predatory pricing to work (or even make sense), all of the conditions you posited have to hold. The predator has to have a much larger cash reserve than the prey and the prey can't have access to capital markets and reetntry needs to be impossible and there can't be any big firms interested in entering the market. That's quite a parlay, which is what I meant about how most economists don't lose a lot of sleep over predatory pricing.

The reason most businesses don't grow large enough for this to be possible is because of anti-trust regulations. Imagine microsoft in a non-regulated free market. They could expand into many other markets, take losses for a while, drive competitors out of business, and really dominate to a large degree, drawing on the vast pool of money that the company has. With every success, they could expand to a new market.

I dunno, I doubt economists lose sleep over it because the regulation effectively prevents this from happening, but I imagine there'd be a few more sleepless nights in a free market without regulation.

 

[Sammy3469]

...The breakdown that I see if the federal bailout of Fannie and Freddie with taxpayer money.

I agree that this is government interference in the free market, but I am at a complete loss at how you equate government guarantees as government regulation. The head line problems we've had over the past thirty years tend to come from relaxing the regulations that had accompanied these guarantees. Again government interference, but regulation?

Pot-AY-to, Pot-AH-to...Basically, the mess was largely caused by the government, not the free market.

Yes FRE and FNM allowed people to get a lot of people who got into their homes and become bloated, but the vast majority of the abuse occurred in non-conforming loans which were then packaged into CDOs to obtain higher ratings from the credit agencies. Those loans had nothing to do with FRE/FNM. This entire thing was caused by Wall Street bean counters who thought pooling a bunch of poor credits could miraculously be transformed into AAA.

 

[IvanKaramazov]

Notice that in order for predatory pricing to work (or even make sense), all of the conditions you posited have to hold. The predator has to have a much larger cash reserve than the prey and the prey can't have access to capital markets and reetntry needs to be impossible and there can't be any big firms interested in entering the market. That's quite a parlay, which is what I meant about how most economists don't lose a lot of sleep over predatory pricing.

The reason most businesses don't grow large enough for this to be possible is because of anti-trust regulations. Imagine microsoft in a non-regulated free market. They could expand into many other markets, take losses for a while, drive competitors out of business, and really dominate to a large degree, drawing on the vast pool of money that the company has. With every success, they could expand to a new market.

I dunno, I doubt economists lose sleep over it because the regulation effectively prevents this from happening, but I imagine there'd be a few more sleepless nights in a free market without regulation.

On the contrary, the arguments that I tossed out there have nothing to do with anti-trust regulation. Even without regulation, the presence of multiple big firms is enough to prevent predation (Microsoft can drive Mom&Pop out of business, maybe, but it isn't going to drive GE out of business).

 

[IvanKaramazov]

Limbaugh predicts landslide for McCain?RUSH: See, the liberals have to blame this Russian attack on Georgia on Bush, and then, by association, McCain, otherwise Obama has no chance. I don't think he has much of a chance, and I think the dirty little secret is that McCain could win this in a landslide.

Might as well cancel the election. It's all over.

 

[flufhed]

I think the dirty little secret

Rush needs a new catch phrase. Notice lots like to use that here, too.Please stop.

 

[Gopher State]

Obama heals hundreds AUSTIN — Ginny McCallum, 43, who has been confined to a wheelchair for much of her adult life, came to hear presidential candidate Barack Obama speak at the University of Texas. Afterward she found herself in a wheelchair access breezeway as Obama and his entourage exited the arena. The candidate spotted her, came over, grabbed her hand and pulled her up. She found herself standing for the first time in eleven years. "He smiled at me and said, ‘Yes, you can,’" she says. "I was so stunned I didn’t know what to do." McCallum is among hundreds of people who say they have been healed by the Democratic candidate, in one of the most surprising and little-acknowledged aspects of his campaign. Reporters have shied away from the story, chalking it up to "Obama-mania" and people’s feelings of elation. "We don’t talk about it a lot, but yeah, it does happen," says one staffer who says he has seen multiple people healed on a rope line. "We don’t know exactly how or why it’s happening, and the Senator won’t talk about it. He usually insists that people keep it quiet and just report it to their pastor or priest." Greeting supporters after a rousing speech in Houston, Obama stepped into the dense crowd and spontaneously began touching people: a legally blind woman, a man deaf in one ear, a cancer sufferer and a lame man. "Yes, you can," Obama said as he laid hands on afflicted bodies. The people’s reactions were so joyous as to be almost frightening. They jumped and shouted and wept. Before they could thank or embrace the candidate he was well down the rope line healing others. Their excitement was lost in the general din of the crowd. Aides acknowledge that the phenomenon is occurring with greater frequency. "His power goes beyond simple inspiration," says one aide. "There is something developing here that I’m not sure any of us fully understands." They say Obama has told them privately that his time has not yet come, so it would be inappropriate to talk about the healings right now. He says he will wait until the convention to speak publicly about the "special calling" he believes he has to lead the country. They do expect him to start alluding to "the providential nature of what is happening on the campaign trail" in an upcoming address, mostly because word is getting around. People have begun bringing relatives by the score to campaign events in hopes of a healing touch. "It’s not the speeches that are drawing people anymore, as good as they are," says a senior staff member. "It’s people wanting to get better, and wanting their friends and relatives to get better. It’s the belief that there’s something more here." •

wow if this president thing doesn't work out Obama's got a great future as a tv minister/faith healer

 

[Bottomfeeder Sports]

...The breakdown that I see if the federal bailout of Fannie and Freddie with taxpayer money.

I agree that this is government interference in the free market, but I am at a complete loss at how you equate government guarantees as government regulation. The head line problems we've had over the past thirty years tend to come from relaxing the regulations that had accompanied these guarantees. Again government interference, but regulation?

Pot-AY-to, Pot-AH-to...Basically, the mess was largely caused by the government, not the free market.

I'm far from an expert on this current crisis and maybe there were regulatory barriers that are responsible for this mess, but no one here has articulated any (that I noticed). I agree that guarantees are market interference, but calling guarantees and bailouts "regulation" is just not an accurate description. Sorry to nit pick, but how much "too much government regulation" rhetoric has been spewed over the years?

 

[cstu]

You can make history in the next few hours.

We're within striking distance of 2 million people owning a piece of this movement.

Supporters like you are transforming the way political campaigns are run -- and you're sending a powerful message that you're ready for real change in Washington.

Meanwhile, John McCain is running the same Karl Rove-style campaign that George W. Bush ran four years ago. He's avoiding issues and attempting to tear down our movement with personal attacks and fear mongering.

Not only has McCain voted with Bush 95% of the time, he's adopted the same political playbook. We've seen it all before, and we can't afford 4 or 8 more years of the same low road tactics and disastrous policies.

Be one of the 2 million determined to defeat Bush-style fear and division by donating $5 or more to build this movement for change.

It's up to each of us to make sure that this election brings change to America. And none of us can do it alone.

Let's show we really are ready for a change from the Bush-Rove politics that McCain stands for.

I hope you'll make a contribution today to support a new kind of politics and make history with 2,000,000 donors:

https://donate.barackobama.com/realchange

We're all counting on each other to bring the change our country needs.

Thanks for everything you are doing,

Barack

 

[cstu]

...The breakdown that I see if the federal bailout of Fannie and Freddie with taxpayer money.

I agree that this is government interference in the free market, but I am at a complete loss at how you equate government guarantees as government regulation. The head line problems we've had over the past thirty years tend to come from relaxing the regulations that had accompanied these guarantees. Again government interference, but regulation?

Pot-AY-to, Pot-AH-to...Basically, the mess was largely caused by the government, not the free market.

I'm far from an expert on this current crisis and maybe there were regulatory barriers that are responsible for this mess, but no one here has articulated any (that I noticed). I agree that guarantees are market interference, but calling guarantees and bailouts "regulation" is just not an accurate description. Sorry to nit pick, but how much "too much government regulation" rhetoric has been spewed over the years?

In fact, it was the lack of regulation that led to the mortgage crisis we are going through (thanks to McCain's GB Phil Gramm).

 

[Bottomfeeder Sports]

...The breakdown that I see if the federal bailout of Fannie and Freddie with taxpayer money.

I agree that this is government interference in the free market, but I am at a complete loss at how you equate government guarantees as government regulation. The head line problems we've had over the past thirty years tend to come from relaxing the regulations that had accompanied these guarantees. Again government interference, but regulation?

Pot-AY-to, Pot-AH-to...Basically, the mess was largely caused by the government, not the free market.

I'm far from an expert on this current crisis and maybe there were regulatory barriers that are responsible for this mess, but no one here has articulated any (that I noticed). I agree that guarantees are market interference, but calling guarantees and bailouts "regulation" is just not an accurate description. Sorry to nit pick, but how much "too much government regulation" rhetoric has been spewed over the years?

In fact, it was the lack of regulation that led to the mortgage crisis we are going through (thanks to McCain's GB Phil Gramm).

I make no claims of really knowing the ins and outs of what went on, but this looks exactly like the Savings and Loan bailouts of the '80's. Deregulation effectively creates a brand new market which has money pouring in for a while as investor try to get a piece of the pie. Lack of any regulation allows these relatively new investment schemes to go well past being sustainable and then someone goes to get out of the investment and the whole thing collapses. That is what this looks like from my position of admitted ignorance. Am I wrong?And, aren't sub-prime mortgages by definition those that loans for borrowers who don't qualify for Fannie Mae or Freddie Mac government backed loans?