4 ms·

>>the free market is basically not a thing anymore I'd say this has little to do with COVID (beyond that it is a random event that decreased then re-increased

by toss1 4y ago

>>the free market is basically not a thing anymore I'd say this has little to do with COVID (beyond that it is a random event that decreased then re-increased demand), but the accumulated effect of decades of failing to enforce anti-trust law. The most propserous times and bigges middle class ended with the Reagan administration, who in 1983, ordered the DOJ, FTC, and SEC to stop enforcing anti-trust laws dating back to the Sherman Act of 1890[0]. This massively destroyed small businesses and concentrated corporate power. E.g., the closer a store was to the Walmart location, the greater the likelihood it would close. Persky and his colleagues found that for every mile closer to the Walmart, 6 percent more stores closed. Close in around the store's location, between 35 and 60 percent of stores closed. [1] Previously, anti-trust laws were enforced so aggressively that when Buster Brown and Kinney shoe companies wanted to merge in the 1960s the Supreme Court blocked the merger because the combined company would control about 5 percent of the US shoe market. Nike alone today controls around 20 percent of that market.[0] Obviously, when anti-trust laws stop being enforced and massive corporations gain oligarchic market and pricing power, they can create inflation at will. This power needs to be rebalanced. Again, recognize, that the "free market" is ab absolute fiction — there is no such thing. Every market has rules and regulations, explicit and/or tacit. The only question is what are the regulations and who enforces them. Absent sufficient regulation, the market dynamics will always end up with all power in the hands of a few major players. This is what is happening here. Looks like is is not the FED that can fix it, it is the SEC and DOJ. [0] https://www.rawstory.com/amp/gop-party-of-business-2659944730 https://www.rawstory.com/amp/gop-party-of-business-265994473... [1] https://www.bloomberg.com/news/articles/2012-09-14/radiating-death-how-walmart-displaces-nearby-small-businesses https://www.bloomberg.com/news/articles/2012-09-14/radiating...

listenallyall 4y ago
> The most propserous times and bigges middle class ended with the Reagan administration Reagan took office in 1981. So you're claiming that the late 70s -- oil embargo, hostages, double-digit inflation and unemployment -- were "the most prosperous times"? Really?
- toss1 4y ago
  I'm claiming that the 50s, 60s, and early 70s were the peak[0]. Yes, yes, the economy did take a hit in the 70s before Reagan took office, but it is quite obvious that that inflation was a combination of extrinsic geopolitical influences and Nixon's abandoning the Gold Standard. Absent a huge anti-working-class / anti-union push, and shutting down most anti-trust enforcement, recovery of the working class would have been a lot faster and would be a lot further ahead. Instead, as you can see from the chart, it has literally taken 50 years for the working class to just get back to the same level as 1973... I don't see any argument that large corporate power, especially pricing power, has somehow declined since Reagan stopped enforcing antitrust laws. Since this is a long-term slow effect, we're seeing the cumulative results now. Most of inflation is NOT materials or labor cost increases, it is corporate profits increases. In a reasonably-regulated (e.g., regulatory bodies not captured by large corporations themselves) economy, this would not be possible. but here we are. [0] https://www.weforum.org/agenda/2019/04/50-years-of-us-wages-in-one-chart/ https://www.weforum.org/agenda/2019/04/50-years-of-us-wages-...
  - listenallyall 4y ago
    > I'm claiming that the 50s, 60s, and early 70s were the peak So before computers kicked off unprecedented productivity increases, and before standardized shipping containers enabled manufacturing to be relocated globally. But sure, go ahead and blame Ronald Reagan.
    - toss1 4y ago
      I can hold recognize that things are not all good or bad, and I don't place 100% of the blame on anyone. That's not the same as saying they're absolved or irrelevant either. I strongly supported (still do) Reagan's vision of the city on the hill, the global champion of democracy, and strengthening of the military to meet those goals and challenges. But his strong pro-corporate actions (stopping anti-trust enforcement and union busting) also did huge damage to the middle class, the legacy of which is still here. Similarly, undoing the fairness doctrine instead of extending it to cable (which also use public infrastructure) and weakening laws on maximum ownership of media, also lead to the insane polarization of media we have today. While microcomputers increasing productivity and shipping containers obviously have some influence, productivity still occurs in the context of workers having rules (or not) that support their bargaining position, and shipping containers in the policy of global trade. Reagan certainly damaged the former, and I don't recall him either much exacerbating nor helping prevent the problems of the latter. Similarly, Obama did some great things, including a major step towards universal healthcare, but he also failed to respond to Russia's invasion of Crimea and actions Syria, both of which directly emboldened Putin to start his current genocidal war on Ukraine. Neither Reagan nor Obama are solely to blame for these serious problems, but they also bear some real responsibility for their major (mis-)steps in the wrong direction.

by toss1 4y ago

listenallyall 4y ago

> The most propserous times and bigges middle class ended with the Reagan administration Reagan took office in 1981. So you're claiming that the late 70s -- oil embargo, hostages, double-digit inflation and unemployment -- were "the most prosperous times"? Really?

toss1 4y ago
I'm claiming that the 50s, 60s, and early 70s were the peak[0]. Yes, yes, the economy did take a hit in the 70s before Reagan took office, but it is quite obvious that that inflation was a combination of extrinsic geopolitical influences and Nixon's abandoning the Gold Standard. Absent a huge anti-working-class / anti-union push, and shutting down most anti-trust enforcement, recovery of the working class would have been a lot faster and would be a lot further ahead. Instead, as you can see from the chart, it has literally taken 50 years for the working class to just get back to the same level as 1973... I don't see any argument that large corporate power, especially pricing power, has somehow declined since Reagan stopped enforcing antitrust laws. Since this is a long-term slow effect, we're seeing the cumulative results now. Most of inflation is NOT materials or labor cost increases, it is corporate profits increases. In a reasonably-regulated (e.g., regulatory bodies not captured by large corporations themselves) economy, this would not be possible. but here we are. [0] https://www.weforum.org/agenda/2019/04/50-years-of-us-wages-in-one-chart/ https://www.weforum.org/agenda/2019/04/50-years-of-us-wages-...
- listenallyall 4y ago
  > I'm claiming that the 50s, 60s, and early 70s were the peak So before computers kicked off unprecedented productivity increases, and before standardized shipping containers enabled manufacturing to be relocated globally. But sure, go ahead and blame Ronald Reagan.
  - toss1 4y ago
    I can hold recognize that things are not all good or bad, and I don't place 100% of the blame on anyone. That's not the same as saying they're absolved or irrelevant either. I strongly supported (still do) Reagan's vision of the city on the hill, the global champion of democracy, and strengthening of the military to meet those goals and challenges. But his strong pro-corporate actions (stopping anti-trust enforcement and union busting) also did huge damage to the middle class, the legacy of which is still here. Similarly, undoing the fairness doctrine instead of extending it to cable (which also use public infrastructure) and weakening laws on maximum ownership of media, also lead to the insane polarization of media we have today. While microcomputers increasing productivity and shipping containers obviously have some influence, productivity still occurs in the context of workers having rules (or not) that support their bargaining position, and shipping containers in the policy of global trade. Reagan certainly damaged the former, and I don't recall him either much exacerbating nor helping prevent the problems of the latter. Similarly, Obama did some great things, including a major step towards universal healthcare, but he also failed to respond to Russia's invasion of Crimea and actions Syria, both of which directly emboldened Putin to start his current genocidal war on Ukraine. Neither Reagan nor Obama are solely to blame for these serious problems, but they also bear some real responsibility for their major (mis-)steps in the wrong direction.