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This is just a bunch of BS to try to explain away the fact that the US economy is geared towards advancing the interests of banks and other financial institutio

This is just a bunch of BS to try to explain away the fact that the US economy is geared towards advancing the interests of banks and other financial institutions. It is amazing that you think that a 15% tax rate is a lot when even under the proposed tax breaks all other comercial activities will pay more than that in taxes. As a result, the US in fact subsidizes an activity which is not the primary producer of ANYTHING other than interests and fees, that is, a drag in the economy. Later you claim that is just fine to support big banks because said banks exist to "spread risks". But of course the biggest risk for a country is in the existence of banks that are too big to fail, since they need to be saved by the government. Therefore, banks in fact perform ZERO risk reduction. They CLAIM to take risks away from the system, but when a crisis occur the whole tab of bad betts will be paid by the citizens of a particular country, not by bankers. As for control of the US and EU, just look at who is responsible for economic policy in these places and tell me if they're not from the same half dozen banks that are already deemed to be too big to fail! What a coincidence...

whiskers08xmt 9y ago
What do you think is the best way for society to provide capital to people who need it? I'm genuinely curious. Peer-to-peer lending is interesting, but I'm not sure it's competitive with banks. State owned banking-enterprise would probably be more expensive for consumers, and if not, a tax for everyone who isn't loaning money.
- akoncius 9y ago
  too-big-to fail banks were bailed out also by people who are not loaning money, so it’s kinda same. just profits are private, damages are paid by public. in this regard private banks are worse. the main issue with government bank I see is that it will be very tempting for politicians to use public bank as a tool to buy votes for people by promising low interest rates or something not viable in long term, and doing damage to economy for short term political gain.
shubhamjain 9y ago
I don't get the revulsion towards bailouts. It isn't as if the money is handed freely without it being expected back. How are taxpayers hurt in the process? In fact, "the government and taxpayers made a $23 billion profit from the AIG bailout." [1] [1]: https://www.thebalance.com/aig-bailout-cost-timeline-bonuses-causes-effects-3305693 https://www.thebalance.com/aig-bailout-cost-timeline-bonuses...
- icelancer 9y ago
  >> In fact, "the government and taxpayers made a $23 billion profit from the AIG bailout." The results do not justify the process. Would small business owners be offered the same loans that were unjustifiable based on assets:liabilities? I can answer that for you right now as someone who has cash in the bank to cover a six figure loan but can't get one due to a 690ish credit score: No, they won't. That we made a profit on (some of the) bailouts doesn't matter. The same process would never be offered to 99.999% of the other citizens of this country.
  - q-base 9y ago
    You could argue about exposure and banks that failed would have had larger impact on ordinary people than the 99.999%. But I generally agree with your comment.
  - mortehu 9y ago
    You don't remember the 99.999% being offered unjustifiable mortgages? That was a big part of the financial crisis.
    - icelancer 9y ago
      Er, the banks were bailed out of those terrible decisions. Individual homeowners were left to hold the bag.
      - mortehu 9y ago
        If you wanted to bail out the home speculators individually, the analogous approach would be to buy their houses at below the prices the speculators had paid, essentially a short sale. Remember TARP bought the assets for close to their realized value, so the loss was already priced in.

whiskers08xmt 9y ago

What do you think is the best way for society to provide capital to people who need it? I'm genuinely curious. Peer-to-peer lending is interesting, but I'm not sure it's competitive with banks. State owned banking-enterprise would probably be more expensive for consumers, and if not, a tax for everyone who isn't loaning money.

akoncius 9y ago
too-big-to fail banks were bailed out also by people who are not loaning money, so it’s kinda same. just profits are private, damages are paid by public. in this regard private banks are worse. the main issue with government bank I see is that it will be very tempting for politicians to use public bank as a tool to buy votes for people by promising low interest rates or something not viable in long term, and doing damage to economy for short term political gain.

shubhamjain 9y ago

I don't get the revulsion towards bailouts. It isn't as if the money is handed freely without it being expected back. How are taxpayers hurt in the process? In fact, "the government and taxpayers made a $23 billion profit from the AIG bailout." [1] [1]: https://www.thebalance.com/aig-bailout-cost-timeline-bonuses-causes-effects-3305693 https://www.thebalance.com/aig-bailout-cost-timeline-bonuses...

icelancer 9y ago
>> In fact, "the government and taxpayers made a $23 billion profit from the AIG bailout." The results do not justify the process. Would small business owners be offered the same loans that were unjustifiable based on assets:liabilities? I can answer that for you right now as someone who has cash in the bank to cover a six figure loan but can't get one due to a 690ish credit score: No, they won't. That we made a profit on (some of the) bailouts doesn't matter. The same process would never be offered to 99.999% of the other citizens of this country.
- q-base 9y ago
  You could argue about exposure and banks that failed would have had larger impact on ordinary people than the 99.999%. But I generally agree with your comment.
- mortehu 9y ago
  You don't remember the 99.999% being offered unjustifiable mortgages? That was a big part of the financial crisis.
  - icelancer 9y ago
    Er, the banks were bailed out of those terrible decisions. Individual homeowners were left to hold the bag.
    - mortehu 9y ago
      If you wanted to bail out the home speculators individually, the analogous approach would be to buy their houses at below the prices the speculators had paid, essentially a short sale. Remember TARP bought the assets for close to their realized value, so the loss was already priced in.