Posted by: Rick | Monday, August 2, 2010

Republicans To Capitalists: We’re Just Not That Into You

Wall Street loves to whine that Democrats are “hostile” to business.  What a bunch of ingrates.  Take a look at this:

Instead of bitching, corporate tools like Mort Zuckerman ought to thank God that Democrats are around to clean up Republican shitpiles.  

Perhaps in November the ex-Decider himself will have an explanation for his party’s dismal economic record:

Just a guess: 9/11 made him do it!

Note:  The Dow is up 209 today.  On Fox News, a grim-looking Neil Cavuto is talking about — what else? — the Mexican hordes at the Rio Grande.   He’s quite the reporter, isn’t he?

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Responses

  1. Wall Street may not be able to whine all that much, but small business certainly can, even if Paul Krugman doesn’t think so.

    Krugman: “…business uncertainty about future regulations — a view that’s popular in conservative circles, but completely at odds with all the actual evidence.”
    I’d like to see what is “actual” evidence is, but I can tell you in all the small business circles I’m in (4 states, two provinces, two countries) regulations are very high on owners’ uncertainty lists, and private capital is very hard to come by right now.

    • What kind of “certainty” are you looking for, Vern? (Isn’t small business inherently risky?) John Boehner wants a moratorium on all governmemt regulations. Would that lead to an economic boom? I don’t really see it.

      The problem we have is insufficient demand in the economy due to high unemployment. What we need is more government spending — particularly on infrastucture — to put people back to work

      I totally agree with you about the financial markets. The capitalists are hoarding cash, and everyone else is suffering for it. Republican laissez faire policies are not going to help in this regard.

      • What kind of “certainty” are you looking for, Vern? (Isn’t small business inherently risky?) John Boehner wants a moratorium on all government regulations. Would that lead to an economic boom? I don’t really see it.

        I’d like to see more tax certainty (up OR down). I don’t necessarily mind paying more taxes, I just would like to know what for, and more precisely, what amount.

        As for Boehner’s moratorium, do I think it will lead to a boom? Not really, but he is hitting on the fact that it would create some Certainty that I do believe will assist in breaking some capital logjams. Both consumers and investors alike are driven largely on emotion whether we like to think we are or not. Private investors (myself included) have no real clue how bad we’re going to get hit when all this is done, so fear is taking over calculated risk. “Hope” usually drives spending/investing quicker than rational thought does, and it can make things self-fulfilling.

        I would also like to see the government support greater tax deductions for charitable donations. We’re in a social crisis right now. This would also likely be used by the affluent to offset estate taxes. It appears Buffett and Gates are promoting that very thing.

  2. Yes, entrepreneurs and small business owners take risks all the time, but those risks are typically around customers, talent, or technology. These are uncertainties we live with, and arguably, thrive upon.

    Regulatory uncertainty is another matter. I’m not blaming it for the economy per se. Rather, I speak of it to hopefully keep it’s level of importance raised (i.e. regulatory certainty) in terms of what we focus on simultaneously in turning around the economy.

    I need to have some idea of what both the direct and indirect costs of this Administration’s policies are going to be. We don’t know that with Obamacare. In one of my businesses it makes more financial sense to just pay the penalties than pay the increased premiums, or does it? I don’t think the country can afford his plan, so what other taxes are going to be raised (individually and corporately) in order to pay for it? Uncertainty #1.

    Uncertainty #2. There are new “red tape” regulations on filing for 1099s (http://www.entrepreneur.com/money/taxcenter/taxpertisecolumnistbonnielee/article207404.html) that were snuck into the Health Care bill. To an employee this may mean nothing, but to a small business, it can be very significant for two reasons:
    1) It just increased my costs (minor)
    2) It was something HIDDEN/BURIED in some 2,000 page bill that no one was able to read. What else is in there that we don’t know about (yet?) Uncertainty #2.

    Uncertainty #3: What’s around the corner?
    Right or wrong, Obama is clearly on a cash grab. I don’t know what new taxes or regulations are going to be introduced. Giving benefit of the doubt, perhaps these will be pro-small business, but until I have some certainty about that, I’m not doing ANYTHING as far as either hiring new or bringing back those I’ve had to lay off. As many business owners have expressed, I’m more inclined to instead invest in infrastructure that will allow the less people I have to do more comfortably.

    And btw, us Capitalists hoard cash for one reason – too much uncertainty about potential return. If it’s any other reason that they’re hoarding cash, then they’re not Capitalists – they are simply Greedy, which exists (worse) in every other kind of economic system.

    Also, I suggest to you that “laisse faire” Capitalism is not a Republican domain as Democrats would like you to believe. The industry that has enjoyed the most “laisse faire” capitalism is the financial industry which is largely Democrat. Dodd made the bailout “laisse faire” by removing any accountability banks had to report on where the dollars went, and it has also been Democrats who have watered down the most recent Wall Street reform which pretty much keep it that way. And just how many members of the current admin come from Wall Street?

    I don’t say that in defense of Republicans, but rather as disdain for government in general. I don’t think Republican-proposed policies are going to help much, but by the same token I don’t think current Democratic policies are doing much good to help small business at this point, either.


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