high marginal rates on top earners led to Kristallnacht — that's just history, folks. that's what the books say pic.twitter.com/xQdKl3S2wB
— Simon Maloy (@SimonMaloy) May 28, 2015
Professor Krugman publishes another one of his excoriating posts on “The Insecure Americans“…
…[I]t’s startling how little room for error there is in many American lives…. for example, 3 in 10 nonelderly Americans said they had no retirement savings or pension, and that the same fraction reported going without some kind of medical care in the past year because they couldn’t afford it. Almost a quarter reported that they or a family member had experienced financial hardship in the past year.
And something that even startled me: 47 percent said that they would not have the resources to meet an unexpected expense of $400 — $400! They would have to sell something or borrow to meet that need, if they could meet it at all…
… and at the very same time, the NYTimes seems to be arguing that Tha Gubmint broke poor little much-abused Richard Fuld:
After nearly seven years of public silence, Richard S. Fuld Jr., the former chief executive of Lehman Brothers, had a lot to say.
In a rambling speech at the Marcum MicroCap Conference at the Grand Hyatt New York in Midtown Manhattan — his first public appearance since the financial crisis — Mr. Fuld offered an opinion about the Islamic State, fretted about Vladimir Putin and proposed that the economy was not nearly as healthy as the stock markets might suggest.
But while Mr. Fuld, known as “the Gorilla” of Wall Street for his brusque style, was eager to share his views about the world, he assiduously avoided talking about his role in the largest bankruptcy in United States history.
Instead, he offered insights into his views on personal topics, including love and death, and made frequent references to his resilience…
Mr. Fuld was vilified during the crisis, becoming the face of Wall Street’s excess and imprudence. However, he was unapologetic on Thursday, suggesting that Lehman could have survived if the Federal Reserve had allowed it to, and deflected blame for the crisis onto policy makers instead of bankers.
He appeared anxious at first, removing his jacket at the podium. “I haven’t done this in a while,” he said. “This is my first public event since ’08. I don’t include my wonderful time with Congress.”
Explaining the origins of the financial crisis, Mr. Fuld avoided any mention of investment banks’ eagerness to issue subprime mortgages. (Lehman had an enormous portfolio of subprime loans.)
“It’s not just one single thing,” Mr. Fuld said. “It’s all these things taken together. I refer to it as the perfect storm.”
At the root of the crisis, in his view, was the government’s push for homeownership. At the same time, hedge funds, private equity firms and sovereign wealth firms grew rapidly, supercharging the global financial system and driving up equity values, balance sheets, the volume of financial products and the need for financing, he said.
“There was very little regulation or market supervision,” Mr. Fuld said…
Hey, nobody told us that stealing was frowned upon!…
… Asked what he could have done differently, he avoided answering directly, and instead said, “I think I missed the violence of the market and how it spread from one asset class to the next. Did we do everything we could? Did we fall prey to some other agendas? I’ll leave it at that.”
In the end, Mr. Fuld seemed hung up on the fate of his own firm, not the broader crisis that its bankruptcy helped ignite.
“Please understand, not a day goes by when I don’t think about Lehman Brothers. Not a day,” he said. “I’d love to tell you I’m over it, it’s behind me. It doesn’t happen. But having said that, I do have to move on.”…
Not a single solitary day…
satby
They say all politics is local. For these assholes local equals them and their immediate families only.
JPL
At least he didn’t blame Obama for the banks failure.
Kay
Yay for Paul Krugman!
This scares me in my work because I see that there’s a group of more secure people (union members, people with pensions, decent regular, consistent wages over decades so they have paid-off property and no debt) who are aging out and moving thru the system and they’ll be replaced by less secure people.
The difference between the two groups (secure/insecure) is really dramatic on an (admittedly) anecdotal level. I think it gets worse once that more-secure group of older people moves thru. I’ve become really aware of how this stuff ripples- how “the middle class” isn’t a cohort or a snapshot -you need a critical mass as a necessary precondition to produce the next generation of “middle class” people.
Baud
I was skeptical, but that convinced me.
I’m kind of curious what the marginal rate was in Germany.
NotMax
The dog ate my derivatives.
NorthLeft12
Pretty close to the same here in Canada. Most seem to be relying on the Canada Pension Plan with virtually no back up funds. Sorry, that’s not quite true. The back up plan seems to be working at Tim Horton’s, Home Depot, or some other local business.
Also in Canada; 51% of homeowners expect to retire while still paying a mortgage. That number is pretty amazing to me. And scary.
Kay
And this isn’t helping any:
It’s just a horrible idea. The only shot working and middle class people have is slow growth over time. They need reliability and predictablity, not 500 dollars once a year in lottery winnings.
Why would they ever model compensation for ordinary people on Wall Street? It screws them. It takes away their one possible avenue for planning and some security.
OzarkHillbilly
Yes, this. I well remember when gov’t thugs were holding guns to the heads of bankers forcing them to make interest only loans, no down payment loans, balloon note loans, liar loans, and every other shaky financial product they were selling in the early ’00s. The gov’t probably forced these same poor bankers to take their lavish compensation packages too.
They are such pitiful creatures.
Baud
@OzarkHillbilly:
And forced the rating agencies to give those loans AAA rating. Stupid government.
raven
@NorthLeft12: We’ll have a mortgage well into retirement.
Kay
@OzarkHillbilly:
George W Bush was the lead salesman. It was central to his “ownership society” agenda. He crowed about home ownership rates as proof of conservative ideology. He even used the bubble to bolster his argument to privatize Social Security- the new homeowners would also own their private retirement accounts. Build wealth! Send that Social Security money into stock funds!
This huge national campaign he did has somehow disappeared from any discussion.
debbie
@OzarkHillbilly:
And those poor brokers are still doing the same things today. That Obama!
debbie
@Kay:
It’s simpler to just blame it all on the CRA and the “Progressives.”
Germy Shoemangler
@Kay: I wonder how many of these homeowners are actually absentee landlords renting out their two and three-family houses in college towns and cities?
OzarkHillbilly
@Baud: Ah yes…. Those poor rating agencies, yet another victim of governmental overreach. If the gov’t just got out of the way, all these people would do the right thing naturally.
Germy Shoemangler
@OzarkHillbilly:
Sounds like it could be a Buck Owens song.
xenos
Was Full the guy who was slugged in the eye by one of his employees who was ruined by the crash? Good times…
Baud
@OzarkHillbilly:
If it weren’t for the government, humanity would have already achieved nirvana.
Government ties us to our corporeal state so it can enslave us.
PurpleGirl
Mr. Fuld made the comment that the government was pushing home ownership… As I remember it, it was one particular president and his administration that was pushing THE OWNERSHIP SOCIETY. While I agree that home ownership is important in a family’s wealth holdings, not everyone can afford a home. And that some people who lost their jobs and whose economic standing was changed, couldn’t keep up with even reasonable mortgages. The problem was the Republican economic policies.
Kay
@debbie:
It’s so funny because I remember the “ownership society”. The speeches and town halls. They really ramped it up after his re-election. I think it was because someone in that administration knew it was a house of cards and the hope was they pump more money in and get out before it fell. I’m so glad it hit them on the way down, because it would have been “Obama’s Crash” had it lasted a year longer.
This is a small town and if you work in my field you end up having a good idea of what everyone makes, because you see wages and salaries and they’re consistent across fields and local employers. It was obvious people couldn’t afford these properties. I would sort of idly wonder if they were all inheriting money when I would see it, because it didn’t make sense.
OzarkHillbilly
@Kay:I really love this part:
And they pushed sub-prime mortgages on minority home buyers at an astronomically higher rate than they did with white home buyers. The gov’t made them do that too.
PurpleGirl
Fuld should jus t slink back into the woodwork and keep his mouth shut. I’m not interested in any thing he has to say about anything. Just take out the check a couple of times a year and make some charitable donations. He has more money than he can spend in several life times… he should spread it around.
debbie
@Kay:
And they’re still pushing it, as in Pataki’s statement yesterday that it was the GOP who was for the middle class, not the Democrats.
They’ve learned absolutely nothing.
Kay
@PurpleGirl:
And the political pressure to keep that bubble going. Bush doesn’t get enough credit as a political hack. Him personally. He was a completely political animal, yet he somehow managed to garner this reputation as “above politics”.
When they did bankruptcy “reform” the first thing I thought was “they know they’re up to their ears in bad debt and they want to limit debt discharge”. It had this desperate quality- “stop them before they all file and the whole thing collapses!”
MattF
Krugman’s blog has an important entry this morning on what financial markets really want.
OzarkHillbilly
@Kay:
The money was flowing everywhere, it was like someone had just hit the motherlode with with a drilling rig. I had friends getting loans they had no business receiving. I was getting loan offers I knew I shouldn’t take and shouldn’t have been receiving. It got so bad that in ’05-’06 I told my wife to take her 401K out of the stock market, put it in US bonds or something else similarly secure. Imagine my shock at learning that it was legally impossible for her to do that. 401Ks are a legally mandated Wall Street slush fund.
And Bush wanted to fo the same with SS.
NorthLeft12
@raven: I don’t mean to pry, but did you decide to carry your mortgage this far? I read an article in the Financial Post that attempted to explain the delay in paying off mortgages as a conscious decision that made sense given the very low mortgage rates that are available.
I am very debt averse and do everything I can to be debt free. I am lucky in that I have very well paying jobs and a wife that shares my philosophy.
esc
I once heard second hand that when the computer geniuses at Lehman Brothers were coming up with models that more or less accurately predicted what eventually happened, they were told to reconfigure everything to make the positive predictions the bosses wanted.
Chris
So big bad government regulations are strangling everything, and also, it’s the big bad government’s fault because it doesn’t regulate enough.
One must pity the poor bankers, creatures with so little agency that everything is thr government’s fault no matter what. Though of course, when it’s bonus season, that’s different. All of a sudden they’re solely responsible for everything that’s gone right.
WereBear
This is what we got instead of pensions. They acted like now anyone could Warren Buffet their way to wealth. Except there’s all kinds of restrictions, as you discovered.
The financial class likes to put on his big show of generating money, but what they really do is go around saying, “Look, there’s a big pile of money over there. Now let’s scheme to take it.”
Baud
@OzarkHillbilly:
Um…that’s news to me. I’m not aware of any law that says you have to keep that money invested in stocks. Is this something you were told, or do you have a source I can look up?
SFAW
There seems to be stuff he’s leaving out, kind of a gap as to whether he feels any sense of responsibility. One might call it the Fulder Gap.
PurpleGirl
@WereBear:
The financial class likes to put on his big show of generating money,
They only generate money for themselves, possible to do when you charge fees for each and every transaction and you churn your clients’ accounts as much and as often as possible.
Iowa Old Lady
@Kay: I wondered about the size of mortgages too, but then I thought of how I was always horrified about the size of any mortgage we had, though they were old-fashioned within our means, as it turns out.
The bad thing is that Wall Street seems to be roaring on, gathering enough money to be looking around for some other “investment” they can puff up high enough to hold the bucks.
OzarkHillbilly
@Baud: It’s what my wife was told by her HR dept. I may have overstated it as I suppose it could be something that is unique to her companies 401K plans, but that is not the way it was related to me.
MattF
@WereBear: That’s not quite true. Basically, it’s up to your employer whether your 401(k) (or 403(b) or whatever) has good options. And then, of course, it’s up to you to use them.
SFAW
@PurpleGirl:
Fortunately, no one is saying they generate wealth (except for themselves). The old maxim is that the only wealth-producing activities (i.e., for the populace in general, not for the 0.0001 percent) is mining, manufacturing, and agriculture.
Their version of “wealth” creation is akin to Milo Minderbinder’s.
raven
@NorthLeft12: We were very close to paying it off three years ago. We (my wife) decided we needed to build a big addition and, after a two year sewer delay, it is in the works. She’s 54 and will be working for a few more years and I’m 65 and hope to hang until I’a at least 67. We do have a really low rate at 2.5% and it’s too late to go back now.
eta We took a 15 so we have 13 left.
bjacques
@SFAW: What you did there. I see it.
MattF
@raven: The key number is the total amount of interest you pay over the life of the mortgage. With rates less then 3%, the total interest will be much less than the principal– on the order of 20 to 30 percent of the principal. Paying off a mortgage at that rate is just not very different from paying it off all at once– and if inflation returns, it’s better.
satby
@Kay: I’ve lived this brave new system, and though some years I earned really good wages, it was in IT, and that field hasn’t been a secure one since 2002, though I was able to evade a lot of the churn until it finally nailed me in 2013. But the ups and downs of “unscheduled vacations” as well as being the sole support of my son’s and unofficial foster kids left me with very little in reserve when I did get the axe at age 59. The 401k was gone pretty quickly after my unemployment ended after 6 months, because I was one of the lucky duckies that the GOP decided to make an example of when they refused to extend benefits in 2014.
So now I’m 60, working at a great job but it pays 1/4 what my old one did and it’s mostly part time concealment loads fluctuate, with a very small online business, and often able only to pay my mortgage, but food and gas for my slowly disintegrating 10 year old car. And I honestly am one of the lucky ones because I at least got a job that pays better than minimum wage in a region of a state where fast food and seasonal jobs are the norm. After 46 years of work, saving in my often eviscerated 401k thanks to market swings, I can look forward to SS as a pay increase.
My story is not at all unusual.
rikyrah
Surprise indictment wrenches former Speaker Hastert from obscurity
Rachel Maddow reports on the sordid Republican history that led Dennis Hastert to become Speaker of the House following the infidelity scandal of New Gingrich, and the shocking new federal indictment that suggests secret payments being made, but not who this person is.
http://www.msnbc.com/rachel-maddow-show/watch/surprise-indictment-puts-hastert-in-spotlight-453693507992
Kay
@OzarkHillbilly:
The number of foreclosure auctions were scary. They’re published in the local newspaper in the back pages. It was just rows and then pages of rows.
At the height of it the people were just walking so you’d see their belongings stacked at the curb. The Big Wheels killed me. So many colorful toys. Later, they got better at it and realized lenders had no idea where the loans and property were because it was a huge fucking mess so they could stay for months without paying before they’d send a lawyer from Cleveland or Columbus to get a judgment and throw them out. We’d tell them to sit tight and use the squatter time to save up first and last months rent before eviction. It was our own personal bail out philosophy :)
satby
@satby: God. Never comment from a kindle. For “concealment” read client, and for “but food and gas” read buy.
Totally missed the edit window.
SFAW
@rikyrah:
1) Which one?
2) Much ‘tho I hate that evil motherfucker Gingrich, I don’t think it was his infidelities that led to him resigning, it was more a function of the Dems taking a surprisingly large number of seats. When has Newtie ever let morality get in the way of his actions?
Chris
Yeah, this shit really needs to be called out loudly and often.
Considering that fascism was specifically bankrolled and partnered with all the way by exactly the class of people who bitch about “high marginal rates on top earners,” and precisely so that left wing movements could be crushed and these people left to count their money untroubled, the whole “fascism is all about left wing politics” crap should rank somewhere alongside Holocaust denial.
Like most Holocaust deniers with half a brain, they don’t deny that it happened. They just completely exonerate the people who made it happen and for whose benefit it happened, turn them into the victims of their own crimes, and their victims into the perpetrators.
rikyrah
Good Morning, Everyone :)
satby
@Kay: And though I bought in a down market, it continued to tank, so 6 years later this property is still underwater by at least $30k. Auctions are still going on all over my area.
The economy hasn’t improved enough in rural areas.
SRW1
They had words with him after he triggered a crash of the world economy?
The horror, how dare they!!
OzarkHillbilly
@Kay: We bought our place at the height of the foreclosure crises. I only looked at “distressed properties” (if that’s the right name for it). The amount of willful damage done to homes out of pure anger was really sad to see. People were pissed.
But it worked out well for us. Bought our 13 acres with a “3 bedroom” (very loosely defined bedrooms) home on it for $20K less than appraised value. After we bought it we had enough money left over to pay for the much needed improvements (and I had the skills) that the place is probably now valued at $50-75K over what we paid for it. I suppose if getting rich was what I wanted we should sell this place and buy another, but we like it too much here in this little slice of heaven.
Kay
@satby:
I have to say, it really is better here. Everyone is working. I think it’s because it’s rural rust belt, and when manufacturing picked up we felt it first.
I agree though that a lot of people are still underwater. We had one upside in my neighborhood. We had this period where younger people were getting real deals at auction and (obviously!) interest rates are ridiculously low. I was just glad someone won at this game :)
We were lucky at the law office because the crash coincided with our paying off the property. so we had “extra” monthly money to get thru the worst of it. The lawyers took a pay cut so we didn’t have to cut back hours for staff and we just this year raised it back to what it was.
OzarkHillbilly
@Baud: Been looking around, have yet to find anything truly definitive but did find this:
Investments:
Typically, plan contributions are invested in a portfolio of mutual funds, but can include stocks, bonds and other investment vehicles as permitted under the provisions of the governing plan document.
I suspect one would have to go to the IRS site to figure out what is and what is not legal, and I have neither the time (this morn) nor the inclination (ever) of going there.
so anyway, tah tah all.
Comrade Dread
Somehow I missed the purges, gulags, and firing squads that happened in Sweden, Norway, the Netherlands, and post-war France and Germany.
Or conservatives are idiots.
Cervantes
@Baud:
(You asked. Well, technically you did not, I suppose.)
After the Treaty of Versailles, with Germany bankrupted, Weimar minister of finance Mathias Erzberger famously passed reforms that included the following: nationalization of key industries; a one-time-only wealth tax on all rich people and special wealth and income taxes on “war profiteers”; and for everyone a federal income tax where the highest rate was effectively raised from about 4% to about 60%. (You’ll forgive me for leaving out the earnest but lengthy German terms for each of these reforms.)
With that, Hitler’s rise was only a matter of time.
Kay
@Comrade Dread:
Bernie Sanders got asked about tax rates yesterday and he said he would raise them, “like that communist Dwight Eisenhower”
Cervantes
@Kay:
Three paragraphs of unabashed good cheer — thanks!
ellie
I don’t know why I read what the republican con artists have to say first thing in the morning. Now I want to kick a puppy.
Cervantes
@Chris:
Exactly so.
Paul in KY
@Kay: The ‘ownership’ society he was talking about (in reality) was poorer Americans ‘owning’ a bigger portion of the tax burden. Get more ‘skin in the game’, and they will vote GOP (the other benefit, of course, being that the tax burden is reduced for the Toffs).
japa21
Anne, one quibble. It does not look at all like the NY Times is arguing that the government broke Fuld. That may be what Fuld is arguing, but, if anything, the Times is mocking him and his refusal to take any responsibility.
Paul in KY
@xenos: I sure hope so. Too bad he wasn’t defenestrated.
Paul in KY
@debbie: It’s all a marketing scam. They want you to ‘own’ the tax burden. That’s the ‘ownership’ they are really talking about.
Paul in KY
@rikyrah: Good morning!
MomSense
I’m just sick of it. People like me are working crazy hours every week–doing exactly what we are supposed to be doing and not getting anywhere. This game is rigged against us. When they say lift yourselves up by your bootstraps they don’t tell you there are 1,000 lb weights tied to the end.
different-church-lady
Yeah, dude, like the economy has been in the shitter ever since the feds created interest deductions in 1913.
NonyNony
@Cervantes: Ah – so you’re saying that National Review is making a threat in that tweet. That makes more sense.
Cervantes
@NonyNony:
In effect, yes. They’re not nice people.
different-church-lady
@Kay:
So Bernie’s planning on having a congress that’s just as liberal as he is. Well, good for him.
(Or was that sarcasm on your part?)
Kay
@different-church-lady:
I just think it’s great he says it. It’s true.
Paul in KY
@different-church-lady: Bernie is articulating his position on taxes.
Kay
@MomSense:
I feel like we’re making progress in having it be front and center, though. It’s like an onion- it was this combination of factors; the loss of overtime, stuck minimum wage, loss of labor unions, tax policy, and now we have a new one- they pay bonuses rather than regular raises so ordinary people (who need it most) don’t get the benefit of regular increases compounding over time.
Who knows what else we’ll discover now that we’re looking! :)
Tone in DC
@Kay:
LULz.
I like it.
Tone in DC
@Paul in KY:
Give it a minute. Plenty of windows (many of them nice high up windows!) in Manhattan.
Actually, I shouldn’t say that, my kidding might hurt some wingers delicate fee fees.
different-church-lady
@Kay: I see now I misread — thought it said “Like a communist Dwight Eisenhower.”
Might not seem like that big a difference, but in misreading it, it struck me that what he was saying was that he’d go well beyond Eisenhower, and not that he was being sarcastic about what people consider communist.
Cervantes
@different-church-lady:
Here’s the exchange:
Laughter ensued.
The question was from a nonagenarian voter, not (as far as I know) a journalist.
Kay
@different-church-lady:
He was being funny. I think politcal media like covering him, because, let’s face it- it’s more fun.
When he announced one of them said on Twitter “oh, sure, he’s anti-corporate but he’s taking free ice cream from Ben and Jerrys!”
Big Ice Cream. He’s in their pocket.
Woodrowfan
@Baud: same here.
different-church-lady
@Kay: Yes, the whole thing makes more sense when (a) you see the accurate quote and (b) I’m not being a dipshit.
Cervantes
@Kay:
I sure hope not!
MomSense
@Kay:
Just had a conversation earlier this week with a contractor–not a big contractor but one of those guys that can keep a crew of 2 or 3 reasonably busy working with him on jobs. He loves the LePage tax plan which is billed as putting more control and say on the local level. Really it is the standard cut taxes even more for the wealthy, raise fees and sales taxes, and shift more of the burden for school and other funding to property taxes. It takes a good 30 minutes to explain why this plan will actually cost us workers more in taxes and fees. After 30 minutes he “got it” and was pretty pissed at the way they make bad things sound good. The problem is that LePage gets massive applause for these ideas and honestly how the hell do we compete with sound bytes when we do not have the advertising bucks or the corporate media echo chamber on our side.
I think we are having these conversations but it is a constant battle to get accurate information that counters the Republican message through the corporate media blockade.
Chris
@Kay:
Is it too much to be hopeful about this?
The media likes him because he’s an entertaining clown, but if he can use the opportunity to get memes like this out in public (e.g. that it really is ridiculous that Eisenhower level taxation is being held up as an act of Stalinism), so much the better.
Paul in KY
@Kay: Any comment on my ‘ownership’ comments up in #58?
bjacques
I remember back when National Lampoon did a parody of the “National Socialist Review.” Speaking of which, is it still a violation of Godwin’s Law to compare someone only to Hitler ice cream?
Let be be finale of seem
And the only Führer is the Führer of Ice Cream
Bill
Anyone have reliable stories on what Hastert’s “prior misconduct” was? I’m not finding any solid news on it, and I’m amazed it hasn’t come out yet.
gene108
@OzarkHillbilly:
Any 401k plan should have safe investments. Some fort of fixed income fund, bond fund or money market fund, where you can park your money and not have the value go down.
If your wife’s did not have it, she needs to bitch to her employer.
Cervantes
@bjacques:
Ads for “Arbie’s Macht Fries,” “Jack Boot in the Box” hamburgers, and “Home of the Waffen,” where “we are only filling orders” and “over six million have been well served.”
Jeff Greenfield was one of the writers.
(Yes, that Jeff Greenfield, after his stint with the RFK campaign and before he decamped for the mainstream media.)
J R in WV
Well, those Eisenhower era taxes would pay high dollar wages to people rebuilding the Interstates, parks, water and sewer plants, schools, pay teachers what they earn as opposed to table scraps, etc. That would reestablish a middle class economy for decades, until the Right-wing retakes government by whatever means and cuts taxes again.
What a great cyclic economic engine, flood it, starve it, but don’t let it stop spinning… no matter what.
gene108
@Cervantes:
I thought Ben and Jerry’s was a subsidiary of Unilever or some other large MNC, i.e. Ben and Jerry sold out several decades ago.
Ruckus
@OzarkHillbilly:
We were told the same thing, when set up we had no control over where the money was invested, only that we could choose not to participate. 2-3 yrs later we were given the ability to choose how to invest out of a number of investments but that was it. Participation and a limited selection of investments. Not sure if there was/is any law/regulation but that’s how the product was sold to the company, and then to the employees.
JustRuss
Do tell. Call me cynical, but I’m going to guess that Fuld and Lehman’s army of lobbyists were not begging for more government regulation.
And as for the “It’s real complicated and nobody could have seen this coming” argument, oh please. I had a friend who was making bank selling mortgages for Countrywide in 2007. When she told me how she was raking in all this loot I was aghast. It was obvious that a very big house of cards was going to collapse sooner or later.
Kay
@Paul in KY:
It’s interesting. It’s a possibility. The “conservatives resent that poor people don’t pay federal income taxes” idea never occurred to me until Romney’s “47%” comments. I just assumed everyone understood that if you have very low income you don’t pay federal income taxes, but that’s not desirable or something to envy.
A couple of years ago my middle son had to file taxes for the first time. He was putting it off so we explained to him he got money back. The following year he told me he was going to file again. I found out he thought it was voluntary- you just do it if you have time :)
Cervantes
@gene108:
Sorry, I must be missing your point. What does it matter if Ben and/or Jerry are no longer the owners? The complaint is against the company, not its founders. If you’re saying we should no longer hold Person Ben and Person Jerry responsible, sure, I agree.
Yes, the company was sold to Unilever in 2000, but as recently as 2010 the CEO was quoted making such pleasant noises as the following:
Quite.
And remember, in 2012 it was not some old activist hippy but the chair of the company’s own Board of Directors who came back aghast from Palestine calling what he’d seen there apartheid.
Chris
@Kay:
I think they just latched onto the first bullshit factoid that would give them a pretext to hate the poor more. Common phenomenon on the right.
And the “47%” meme is something that had been circulating on wingnut blogs for years. IIRC, it’s based on a year with an abnormally high number of poor people – 2009 or 2010, right after the crash when a lot more people than usual were in the shit and therefore too poor to pay taxes. But in the wingnuts’ head, it’s become what they assume to be the permanent state of affairs.
Ruckus
@satby:
No it is not unusual. I’ve related here before my situation and it isn’t pretty. I had to start SS as soon as I was able, only to be able to eat. I had a plan but that was crushed/eaten/fucked over by the financial wizards and their greed. Now, if I want to live minimally comfortably, I pretty much have to work till I drop. Except that I won’t be able to do what I know till then, I’m already seeing a definite slowdown, what that will be in 4-5 yrs is anyone’s guess. And all this talk of working in retail, etc for crap wages? I don’t see people my age doing that around socal, they are all much younger.
We are so screwed.
debbie
@Ruckus:
I lost my freelancing business and all but $4,500 of my IRA thanks to Wall Street. I was unemployed for 1.5 years, then managed to get hired for a writing job. I at least have health insurance (first time in 15 years). No way can I save, and if I work till I’m 70, I’ll get close to what I’m making now. I figure I’ll end up working until I die. A cheering thought.
Cervantes
@Ruckus:
Retirement plans are most definitely regulated by statute (the Employee Retirement Income Security Act (ERISA), 1974, as amended).
The US Department of Labor offers a useful guide.
Paul in KY
@Kay: They wrote it down in various policy papers, ala ‘Project for a New American Century’ (not that one, but crap like that). It is not my conjecture, it’s the truth.
Paul in KY
@Chris: It’s their standard marketing BS: ‘Clean Skies Initiative’, ‘Right to Work’, etc. Just Luntzian style marketing buzzwords that dumbasses think means one thing, when in reality it means something quite different.
burnspbesq
@OzarkHillbilly:
That strikes me as very odd. Every competently run 401(k) I’ve ever seen gives participants a range of investment options with varying risk/return profiles. There may be limitations on how often you can move money from one fund to another, but the idea that what your spouse wanted to do was “illegal” comes from someone who really doesn’t understand ERISA. “Illegal” and “not permitted under the terms of the plan” are not synonymous.
Ruckus
@debbie:
Have a relative who works at a bank-mid/upper management, and he told me that, work till you drop. Asshole has a much more secure retirement plan and makes enough to save something, and didn’t lose everything in said financial fuck up. I did. I’m back on my feet now, so to speak, but this can’t last forever and I don’t plan on dying of old age, at work. I’ve worked way too many 60 or more hr weeks in my life, trying to survive and get just a little bit ahead or at least be minimally comfortable, I be damned if assholes who wear suits and look down upon me as if I’m a piece of dog shit they just stepped in are going to use me like a piece of toilet paper.
eldorado
@Kay: you are a terrific writer and this blog is poorer since you are no longer doing front page posts. do you write elsewhere?
Chris
@Paul in KY:
Yeah, and it’s another reason for my longstanding policy that it’s a waste of time to even talk with conservatives about politics. They never say what they mean anyway.
Chris
@eldorado:
Co signed.
Archon
Chris Hayes has basically alluded to this but the working class in America is way too divided and demoralized (mainly on racial and cultural issue) to force changes in our economic and political system.
It’s going to take a revolt from upper middle class working professionals to shake the system. People still paying college loans in their late 30’s and who don’t have the write offs that rich people get so they pay a much higher marginal rate then the super wealthy. People whose mortgage or rent is way too high to really save for retirement or their kids education. We need people like that to take to the streets.
Until educated working professionals become truly fed up with the system, things won’t change.
opiejeanne
@JustRuss: I had a conversation with a friend in 2006 who told me that his sons were writing mortgages like mad and making tons of money. I asked him about the younger son who was terrible at math (he really was) and he told me that it didn’t matter, he didn’t need to know any math for this job. I was shocked; there is a formula that tells you how much your clients can afford and you need to have some math skills to punch in the numbers and turn the crank, or at least you used to.
At the same time we were swamped by offers to refi our very good mortgage, with emphasis on all the money we could take out on the side. We passed. People told us we were nuts (many of them lost their houses a few years later). The phone rang off the hook with offers from our own bank wanting us to refi with them, but they couldn’t beat the mortgage rate we had at that moment, 5%. We watched houses sell for ridiculous prices in our neighborhood and wondered if we should do the same, just take the money and live in a cheap apartment for a couple of years, but we decided not to. Then we watched the foreclosures in our neighborhood and saw the buses of real estate investors roll past.
We sold the place in 2010 and made a bit of money over what we had paid for it in 2003 even though the market was still pretty bad. We sold for a whole lot more than conventional wisdom said we’d get (sure, they can sell a $500k house real quick if it’s listed at $350k). I still miss that garden.
jl
” was the government’s push for homeownership ”
I think that is BS. The initial wave of securitization of mortgages, in markets that were highly regulated compared to what came later, did lower the cost of capital for home buyers, which is a good thing (other things held equal). It’s hard to untangle Bush II’s push for more homeownership (remember the ‘opportunity society’?) from the irresponsible deregulation that occurred during his term.
But it was the deregulation, not the push for home ownership, that led to bubble and burst. I don’t have time to find them now, but if you go o to Mark Thoma’s Economist View blog over last month, you will find studies that try to parse out what caused the boom in lending, housing bubble and the bust. Evidence from multiple studies is that reduction in the short run cost of capital due to deregulation was the most important factor, not an increase in demand (which would be most important cause if demand promotion policies were most important reason).
The longer run cost of the experiment in deregulation has been enormous. Median individual and household income still lower than before the bubble burst, and most importantly, below what it would be if long term trend prior to bubble had been maintained.
I think most of the reactionary rationales for the bubble and panic, which try to pin blame on policies that sound ‘liberal’ are BS. Another one is that government policies to reduce red-lining in minority neighborhoods introduced unsound and unprofitable business models to financial industry, and these models spread like some kind of contagious disease. How this epidemic of bad business model spread through supposed perfectly rational deregulated financial markets is left unexplained.
Ruckus
@jl:
It really shouldn’t be that hard to explain. It’s all bullshit, spread around liberally, in the hope that something could be made to grow, like profits. Not a care in the world that the losses would be profound.
opiejeanne
@jl: Lenders hired Spanish-speakers as essentially sales agents to go into rental neighborhoods to explain how they could buy a house with the no-down, zero interest loans available. The people who were being sold this hooey had no business buying houses because they couldn’t afford the real payments and it was a heartless, not to mention unethical practice.
We sold my in-law’s house to a couple who were absolutely thrilled to be buying their first home and we were very happy for them. This was in San Bernardino, the house sold for $140,000. We didn’t realize until later that they had fallen prey to these terrible lending practices when we drove past on a whim and saw that they were gone and the place was a shambles, occupied by someone who didn’t care about upkeep.
opiejeanne
@Ruckus: The results were heartbreaking in many cases. In our neighborhood it turned modest single family homes into rental/flop houses. No one knew who lived in these houses because they were constantly changing. At one brief point, the three bedroom place on the corner, 1800 sq ft, had 15 cars parked there. I was told that there are no zoning laws that govern how many beds are in a place.
different-church-lady
@debbie:
I figure I’ll end up working until I’m physically unable to continue and then who the eff knows what happens between then and when I die.
different-church-lady
@Ruckus:
Like that jackass has done anything even remotely resembling “labor” in his entire life?
PaulW
Wake up Betty Cracker and all the other Floridians of madness, I will be causing chaos and anarchy in the East Pasco area Saturday afternoon (May 30th 2 PM – 4 PM) at the Wesley Chapel Barnes & Noble during a Local Authors Event.
different-church-lady
@opiejeanne: As the neighbors have told it to me, upwards of 11 people were living in my little 2 bedroom bungalow before I bought it at a fire-sale price. The basement was carved up into three hastily built spaces, each with it’s own door, and there was cable and phone lines pulled to every room in the house, so I believe it. The bare patch on the front lawn where they were parking cars still needs to be re-seeded every couple of years.
opiejeanne
@different-church-lady: Ugh.
What really tore it for me was that the new owner who turned that place into a flophouse lives in the neighborhood. He has done this with several other houses around the downtown Anaheim area but at least three right where he lives, but not on his block.
The people who lost the house bought it at the same time we bought ours. They were about to retire and were thrilled to be buying their first house. They paid about $300k for it, but when the refi madness began they mortgaged it for $700k, thinking that in 5 years when that came due they’d be able to refinance it easily because it would be worth so much more by then. They didn’t spend the money on a new kitchen or any other improvement other than new windows and new carpet. The people next door said they just spent the money, but couldn’t say on what. They didn’t go to Europe, didn’t take long vacations, didn’t remodel the house in any important way, didn’t even repaint it. The money was just gone.
nominus
@Kay:
Bear in mind that conservatives think it’s “47% don’t pay ANY taxes”. The “Federal Income Tax” detail is conveniently forgotten or deliberately ignored. The outrage machine runs a little smoother without that pesky additive.
opiejeanne
@different-church-lady: My daughter’s 1924 house in Seattle was like that, cut up into lots of small bedrooms, although no one could park on the lawn. 10 to 12 people living in it, along with 8 pit bulls. The owner had inherited it, owned it outright, but had decided to take out a mortgage on the place as well as rent it out. She didn’t use the rent to pay the mortgage, because she eventually lost it to a bank.
When my daughter bought it from the bank it had sat empty for about a year so it was starting to deteriorate from not having the heating on through a couple of very cold winters, the wood floors buckling in the living room and dining room.
opiejeanne
@nominus: In this very liberal state of Washington we pay no state income taxes but our sales taxes are pretty high at just under 10%, most places. Property taxes are a bit high but not what I consider outrageous.
Ruckus
@different-church-lady:
Actually he has a reasonably decent history. But that is history, not current events. Not going into the details here other than privileged private schooling so make of that what you will. He and I no longer are on speaking or any other kind of terms. I will no longer tolerate associating with, as I posted above, people who view me as used toilet paper, something they have soiled and are willing to flush away.
nominus
@opiejeanne: same here in TX, no income tax and 8.25% ST. But all the conservatives here conveniently forget that people pay payroll taxes, sales taxes, telecom taxes on cable and phones, utility taxes on electricity, water, and sewage, property tax increases (but never decreases) are always passed on to renters, and they pay tons of taxes on every kind of combustible fuel there is. To them, the poors pay no taxes at all and are living the high life because of it – while they take every single deduction and tax break they can find, and lie about anything they can’t qualify for.
That’s why stupid shit like flat tax ideas gain traction, because they don’t stop to think about ALL of the taxes they’re paying, so someone sells them on the idea of lower income taxes but they fail to see the actual cost, and they fail to see how different types of taxes affect different income groups. That and the fact that like most other people they’re incredibly selfish and self-absorbed.
Ruckus
@opiejeanne:
I moved to OH for a job a few yrs back and the tax rates were higher than CA. The major place that showed up was property taxes. But because the property was valued at much less, about 1/3 for a better house/larger lot, I paid a smaller amount. It costs money to have an average government. A good one costs even more. But it’s easier to complain about the DMV than it is to decide to pay for it to be better.
The thing that amazes me is that a lot of old people, like me, act like life was a lot better 50-60 yrs ago. It just fucking wasn’t, other than there was a glimmer of an idea that if you actually worked you might be better off. A modest home, an education for your kids, a working car in the garage….. and that would have been lots better than what most of their parents had. Where is that life now? It’s been stolen, in small bites and in large scoops out of our asses. We have gotten rid of actual slavery but we’ve replaced it with something for which I have no better term than “wage slavery” which is like working in a shitty small company town, only moving on to someplace better really isn’t possible anymore. You won’t get beat or killed for moving on or even staying put (well, unless you are still black) but any opportunity is rapidly eroding for most. I think that’s why the gun nuts are yelling about freedumb. They don’t understand what and how it’s happening but they know that there isn’t much chance of it being anything good.
Paul in KY
@Ruckus: You should never associate with people who bring you down.
VFX Lurker
@WereBear:
In the last 15 years I’ve worked on multiple projects at multiple studios. I’ve had access to a 401(k) plan only three times out of those many projects. My take on the 401(k) plan is that it’s not a retirement plan — it’s a tax shelter for long-term savings. You technically don’t need a 401(k) to save for retirement, since you can always put long-term savings in CDs, I-Bonds, IRAs, a taxable savings accounts at Vanguard and/or a jar buried in your backyard.
Here’s my biggest problems with the 401(k):
– It’s optional! ARGH. It does not FORCE the worker to save, unlike a real pension plan.
– Those in higher tax brackets get more tax benefit than those in lower brackets.
– It’s not consistently offered by employers. Some employers offer it, some don’t.
– Too many plans offer high-cost investment options.
– The 401(k) owner bears the full risk of longevity, instead of spreading it around a larger pool.
More on that last point. In shared systems like a pension plan, the workers that die young indirectly support the workers that die old. That is, a worker that dies at 66 frees up a little more money to cover the needs of the worker who dies at age 106.
Under the 401(k) system, each worker subsists solely on his or her own savings, instead of drawing from a shared pool of savings. Without a pension, a worker has to have enough socked away to cover all expenses for 40 years, the cost of a SPIA and/or the ability to delay Social Security until age 70. This is because no one can predict how long he or she will live.
Pension plans forced workers to save for their retirement, and the shared pool of pension savings insured against the risk of outliving one’s savings. This is why 401(k) plans cannot fully replace pension plans.
Ruckus
@Paul in KY:
Sometimes you have to, smoothing family relations, a job which is, while not political in the way we talk about it here, is a political position. I had one of those, you will never satisfy some of the people all of the time, you will rarely satisfy some of the people some of the time, and you will always dissatisfy someone most every day.
Ruckus
@opiejeanne:
I just moved a few months ago from a neighborhood like that. A large percentage of the homes had garages converted into apts and rented out. Many of the home were however owned by the occupants but lots of them had more than one family living there. House I was in had 5 bedrooms, although it was originally built with 3. I rented a room and shared with usually 2 other renters and the landlady. She paid almost nothing to rent the place, the three of us covered that and some of the utilities. But each one of us had a car. And no garage, it was a bedroom. And this was, as I said, not unusual.
Paul in KY
@Ruckus: Relatives that bring me down, I stay away from. You are made of stronger stuff, it appears.
Ruckus
@Paul in KY:
I left the job and I left family members that treat me the same way. I may not learn fast or sometimes even very well but I do learn. And I’m getting to that part of the ride where it’s all downhill and getting steeper every day. I don’t need to put rocks and trees in the middle of the hill, it’s already tough enough.
VFX Lurker
I don’t know if folks on this thread will find the following link helpful at all, but it’s something I’m studying right now to cope with my current job uncertainty:
http://poorcraft.com/archive
The title’s not the best, and it’s aimed at youngsters, but I found some of the tips new and valuable.
opiejeanne
@Ruckus: I know and I worry for my adult children because they are all three in that boat you just described. At least the girls have a retirement plan and health coverage where they work now, but I don’t know if my son does, and right now he wouldn’t have paid into it for the past 3 years because his hours were cut so drastically. (PAY YOUR DAMNED BILLS, SHERIFF ARPAIO!).
We are lucky in that my husband always had a retirement program no matter where he worked, with the exception of three months of under-employment in 1992. What really gets me is that in SoCal and probably elsewhere too, there are people screaming about employee retirements and how they should just be stopped because they cost the taxpayer too much. The stupid thing is that the agencies using CalPERS weren’t paying a nickel into retirements for years because the program was so flush with money, only the workers paid their part and it was enough. That was before the real estate/financial crisis in 2007 and even then the agencies (cities and counties) weren’t asked to pay their agreed share for a couple of years after because the fund was so well managed. CalPERS is hated by Republicans statewide because they aren’t interested in speculating on Wall Street with all that lovely money; also, there is a current scandal about the high fees paid to “consultants” by retirement fund managers, and CalPERS dealt with that right around the time of the crisis.
opiejeanne
@Ruckus: I wouldn’t have had a problem with that, and we had one house on our block like that and knew the people who lived there; two families plus a bachelor, and several children, 5 or 6 cars. What we really objected to was not ever knowing who was living in that other house because it was different people just passing through, although 15 cars on the cul-de-sac was annoying.
opiejeanne
@opiejeanne: Erm, CalPERS does invest in Wall Street, but not the way the Republicans want them to.
Paul in KY
@Ruckus: Hoping for the best for you.