11/24/2008 08:57:00 AM EST

Too big to fail?

posted by guttermutt

Well then, that's a problem now isn't it.  Conventional wisdom states "Don't put all your eggs in one basket".  Well instead of a big government payout, shoving more eggs into your already teetering basket.  Why don't you get some more baskets and distribute your eggs a bit eh?  That way, if one, two or a few of your baskets falls, it isn't such a big nasty mess when it hits the floor.

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These corporate giants would be better off as alliances of smaller companies, they would boost the economy as well, encouraging competition among rivals to cut their massively inflated practices, into more manageable, safe companies to invest in.  If one branch of the business is failing, another company could step in, offering solutions through responsible, practical business decisions.  Allowing your company to become too big to fail is irresponsible in the first place, and if you had any business sense you would realize that their needs to be regulations to prevent this kind of thing from happening.  It turns out that we need government regulations, because these businesses are too far up their own arses to regulate themselves. 
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Too big to fail? | 10 comments (10 topical, 0 hidden)
Why? (none / 0)

"Why don't you get some more baskets and distribute your eggs a bit eh?"

Karl Marx thought that the inevitable result of capitalism was the consolidation of wealth and power to the State.  (See p. 243 of The Communist Manifesto.)  But Marx was wrong.

One of the results of the capitalist system is the consolidation of power into the hands of a few wealthy individuals and large corporations, taking it out of the hands of the public at large.  The "big government payouts", facilitated by the distractions of synthetic worldwide disasters on the financial, political, and climatological fronts, implement this weakening of government and, therefore, of the people and of the country.  Bad times are ahead for most of us, because those bad times are necessary to help the already rich and powerful to get richer and more powerful.

by EveningStarNM on 11/24/2008 11:13:20 AM EST

Rats. (none / 0)

Sorry.  I gave a bad link for Marx's book.  But if you could find that page number, it would say that the “proletariat will use its supremacy to wrest, by degrees, all capital from the bourgeoisie, to centralize all instruments of production in the hands of the State.”  Marx goes on to say that "the following will be pretty generally applicable:

  1. Abolition of property in land and application of all rents of land to public purposes.
  2. Abolition of all right of inheritance.
  3. Confiscation of the property of all emigrants and rebels.
  4. Centralization of credit in the hands of the state, by means of a national bank with State capital and an exclusive monopoly.
  5. Centralization of the means of communication and transport in the hands of the State."
As it turns out, the exact opposite is happening.

by EveningStarNM on 11/24/2008 11:36:38 AM EST

[ Parent ]
Not sure where your going with that (none / 0)
I just think that no company should be able to crush so many that the government decides that it would be less harmful to throw billions of dollars at it than to let it die.   

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by guttermutt on 11/24/2008 07:52:28 PM EST

[ Parent ]
The point is: (none / 0)

The purpose of the bailouts is to funnel loads of money to the rich.  It is not even to help the banks so much as to accomplish that goal, and the purpose certainly is not to help the economy.

It's a straight-up robbery, done under our noses, and that's why Paulson looks so nervous.

by EveningStarNM on 11/24/2008 10:53:48 PM EST

[ Parent ]
I agree (none / 0)
but I was breaking their justification, providing a solution to the "problem" they give of businesses being too big to fail.

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by guttermutt on 11/25/2008 05:01:16 AM EST

[ Parent ]
Yes, and it's a good solution, too. (none / 0)

But there's a better chance that Obama will continue his swing to the right than that your idea of breaking up the big corporations will ever be implemented.  They won't even be allowed to go bankrupt.

For instance, how likely do you think it is that the Big Three will be broken up either intentionally or through bankruptcy as opposed to maintaining their current structure?  I think they're going to get a pile of money.  They'll probably will be forced to change product designs and to ''streamline'' their operations (i.e., close more plants), but their corporate structures will remain as insecure, uncompetitive, and monolithic as ever.  More people will be forced to find lower-paying employmen t outside of the industry.

Side Note: Obama is using a lot of left-leaning words, but he's appointing a lot of right-leaning former Clinton administration advisor s and administrators, some of whom are participating right now in Bush's efforts to prop up the corporations.  And it will be harder for him than it was for Lincoln to correct his mistake.  (Note that for Lincoln, it was nearly a disaster.)

Still, Obama is better than Bush.  But how hard is it, really, to be better than Bush?

by EveningStarNM on 11/25/2008 09:07:41 AM EST

[ Parent ]
That is most likely what will happen (none / 0)
We're in total agreement there, big business is not likely to ever lose it's stranglehold on the US government, or the world's governments, it may just loosen it up enough to let them think they are back in control before they lay the big squeeze on again.  

As for Obama and his administration, yes it is a risky prospect bringing in so many conservatives and right leaning liberals, but I have to believe his power as President will be much like his power in his election campaign to change minds and show them the way forward, combined with the fact that George Bush has shown the wrong way, pretty soon being acting like a conservative is going to be career suicide.  Lincoln had balls, no doubt, Obama's got em too, sometimes it's gotta be the dangerous option that works and I think Obama's got the conviction and intelligence to pull it off.

We can only wait and see now.

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by guttermutt on 11/25/2008 11:15:47 AM EST

[ Parent ]
Definitely (none / 0)
That's one thing we agree on there, and as a bonus I keep picturing piranhas eating a cow...awesome. 

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by guttermutt on 11/24/2008 07:55:26 PM EST

I'm a ''Marxist-Stalinist''? (none / 0)

How in the world did you arrive at that stupid conclusion?  I swear, Ken, if you're going to abandon logic completely, the least you could do is to leave a trail of breadcrumbs so that we can follow you into that murky jungle you call your mind.

by EveningStarNM on 11/24/2008 11:00:08 PM EST

[ Parent ]
Neither (none / 0)
both end in a smelly pile of dog mess.  Unfortunately it's just the nature of man, absolute power corrupts, which is why it doesn't matter if all the power is in the hands of the government or big business, it's always going to end badly.  That's why government regulated/free market balance of power (sensible regulations mind you, not the softball crap that I'm sure Paulson will propose) is the way forward.  And the regulatory agencies need to be immune from lobbyists to maintain the best interest of the people of the nation, not the CEOs.

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by guttermutt on 11/25/2008 05:08:17 AM EST

[ Parent ]
Too big to fail? | 10 comments (10 topical, 0 hidden)
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