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#309712 - 12/05/18 09:55 AM Re: Election Day [Re: chunkstyle]
pondering_it_all Offline
veteran

Registered: 02/27/06
Posts: 8302
Loc: North San Diego County
Quote:
'Democrats are capitalist

Quite true, and it's mostly because of the replacement of pension plans with 401Ks. For many years, people have been getting statements every month showing their various mutual funds values, following the stock markets, listening to Marketplace on NPR, watching Cramer, etc. All the things that capitalists do, even though you think of million dollar portfolios when you hear the term capitalist. All the online brokerages with sub $10 stock trades can also take some credit.

The other thing that made a lot of less wealthy people capitalists is the trend toward being real estate rentiers. Again we think of Trump's father when we hear the word, but a huge number of working class people own a home they rent out as well as their own home. Again, most people who do this are trying to replace a pension with some other form of income generation for their retirement.

If you don't do this, you have to live on Social Security which is not a very secure life at all.

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#309715 - 12/05/18 05:08 PM Re: Election Day [Re: Greger]
chunkstyle Offline
member

Registered: 10/02/07
Posts: 1366
So when did americans decide to atomize themselves into individual retirement plans as opposed to a described benefit pension plan PIA?
Granted it was an enormous windfall for the financial services industry but it hardly benefited most working Americans. True the process was started in the 80's and accelerated in the nineties but how did we, as a society, decide on this market mechanism as the only alternative?
I remember the wave of raidership going on in the eighties fueled, to a large extent, by decades of amassed wealth in pension benefit plans that were not legally protected from these white collar criminals. In fact, that is still going on today since the raiders merely changed their name to 'Venture capitalists'.
Now, everyone who is in the market is relying on a big returns to finance their retirement. Mind you, that might not work out so well when the big players take their chips off the table and the market crashes as it is known to do thru grift and corruption. What would have happenned if it were not for Monika Lewinsky blowing up the grand bargain to privatize Social Security?
Then there's the question of how's that neoliberal idea of self funding thru the market world retirement panning out? Well, by any measure, not well. There are more people going into retirement age with no savings to speak of or, as we witnessed from the melt down 10 years ago, in a state of precarity now.
Once again, the Democrats do nothing to address what is a huge growing problem for a very large demographic (looking at you Boomers). Much like health care, they receive a huge amount of campaign cash from the FIRE economy that directly benefits from this state of affairs.
It might be why Sanders has called for an expansion of Social Security instead of euphemisms and hollow market world slogans that make up so much of the Democratic party while more and more people are falling into precarity and despair and looking for a way out. No matter how extreme or contradictory. Fascism anyone?


Edited by chunkstyle (12/05/18 05:14 PM)

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#309723 - 12/06/18 01:29 AM Re: Election Day [Re: Greger]
pondering_it_all Offline
veteran

Registered: 02/27/06
Posts: 8302
Loc: North San Diego County
Yeah, like Fascists would help out retired folks! More likely to round them up for mass euthanasia. This is one of Sanders' positions that I whole-heartedly agree with. (Not that I disagree with many of his positions.) Social security is most people's most conservative part of their retirement portfolio. Privatizing it would be a disaster. You are in deep doo doo if SS is all you have. Better plan a move to Mississippi or Mexico to get by.

We would do a lot better if Social Security was doubled or even tripled. Then people could actually retire on it without going to live in a cardboard box behind Safeway. Because most people are not qualified to make financial decisions. But then again, this ant is going to be laughing at a lot of grasshoppers who spent every cent they made while they were working, on crap that does them no good in later life.

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#309823 - 12/11/18 09:25 PM Re: Election Day [Re: chunkstyle]
NW Ponderer Offline
Moderator
Carpal Tunnel

Registered: 09/09/11
Posts: 16674
Originally Posted By: chunkstyle
So when did americans decide to atomize themselves into individual retirement plans as opposed to a described benefit pension plan PIA?
Granted it was an enormous windfall for the financial services industry but it hardly benefited most working Americans. True the process was started in the 80's and accelerated in the nineties but how did we, as a society, decide on this market mechanism as the only alternative?


Here's my consistent take: Most policymakers divide their constituents into investors or non-investors. Wage earners are, by and large, non-investors. Certainly the poor and minorities are non-investors. There is a nearly perfect correlation between the investor class and the donor class (people with money are usually the ones that donate), so it behooves elected representatives to cater to that class. This neatly corresponds with the biases of economists, who view most economic activity (wrongly) as based upon "investment". That explains the fixation on the stock markets and "housing starts" as gauges of economic activity.

As a result, policymakers (of both parties) tend to skew economic policy priorities toward the investor class - on taxes, on healthcare, on infrastructure, etc., rather than on "the citizenry" in general - but with different justifications. 401(k)s were born of this perceptual framework. A brief history of the 401(k), which changed how Americans retire (CNBC). Social Security is good and all (or bad, if you are conservative), but don't represent "investment" in the economy (which is empirically wrong on so many levels). Democrats saw the 401(k) as a supplement to SS, whereas Republicans saw it as a replacement for Social Security. Corporations saw it as an off-ramp for expensive pension plans, and Hedge Fund Managers saw it as a new source of revenue.

The problem is, 401(k)s, like Social Security, were not intended to be a substitute for retirement plans, but a hedge against penury in old age. 401(k) Basics: When It Was Invented and How It Works (LearnVest)
Quote:
Despite their popularity today, 401(k) plans were created almost by accident. It started when Congress passed the Revenue Act of 1978, which included a provision that was added to the Internal Revenue Code — Section 401(k) — that allowed employees to avoid being taxed on deferred compensation.
In 1980, benefits consultant Ted Benna referred to Section 401(k) while researching ways to design more tax-friendly retirement programs for a client. He came up with the idea to allow employees to save pre-tax money into a retirement plan while receiving an employer match. His client rejected the idea, so Benna’s own company, The Johnson Companies, became the first company to provide a 401(k) plan to its workers.

In 1981, the IRS issued new rules that allowed employees to fund their 401(k) through payroll deductions, which kickstarted the 401(k)’s popularity. Within two years, nearly half of all big companies were offering 401(k)s or were considering it, according to the Employee Benefits Research Institute.
According to the Wall Street Journal, "just 13% of all private-sector workers have a traditional pension, compared with 38% in 1979". That change has been devastating for workers because, as the Economic Policy Institute notes, "401(k)s [are] 'a poor substitute' for the defined benefit pension plans many workers primarily relied on, which provide a fixed payout for employees at retirement".

Many employees (mostly white-collar) are now severely dependent on Stock Market prices in retirement because 401(k) "plans" hold more than $4.8 trillion in employee assets on behalf of nearly 54 million workers. The 2nd Bush administration pushed 401(k)s as a substitute for Social Security, even though most workers don't have access to them. According to data from the U.S. Census Bureau, only 32% of Americans are saving for retirement in a 401(k).

What we need to do is flip the script: instead of skewing policy toward the "investor class" - which accounts for only 20% of the population (and even less of the functional economy) - we need to skew it toward "the citizenry" as a whole. Thus, healthcare security, retirement security, education availability and living wages should be the touchstone for policy. And, those are popular positions for voters (especially on the left, but even amongst Republicans). Little Partisan Agreement on the Pressing Problems Facing the U.S. (Pew Center)

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#309825 - 12/11/18 10:22 PM Re: Election Day [Re: NW Ponderer]
NW Ponderer Offline
Moderator
Carpal Tunnel

Registered: 09/09/11
Posts: 16674
I thought this discussion was in a different thread.

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#309828 - 12/12/18 01:11 AM Re: Election Day [Re: Greger]
chunkstyle Offline
member

Registered: 10/02/07
Posts: 1366
Dunno NWP.
When it comes to the financialization of the U.S. Economy it could easily fit into the subject of US elections.

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#309829 - 12/12/18 01:13 AM Re: Election Day [Re: Greger]
chunkstyle Offline
member

Registered: 10/02/07
Posts: 1366
You sound as though your on board with the universal basic goods idea.

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#309833 - 12/12/18 03:42 PM Re: Election Day [Re: chunkstyle]
NW Ponderer Offline
Moderator
Carpal Tunnel

Registered: 09/09/11
Posts: 16674
Yup, I have several firmly progressive positions in my noggin. Our only differences are in how to get there.

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#310037 - 12/27/18 07:49 PM Re: Election Day [Re: Greger]
pondering_it_all Offline
veteran

Registered: 02/27/06
Posts: 8302
Loc: North San Diego County
Looking back at the election, my prediction about gerrymandering came true. That was about the strategy of dividing up voters so you have the maximum number of 5% win districts, and most of the other Party packed into a few districts. Normally a great plan, except for when the other side wins by 8.6%. Then all of those "safe" districts go to the other Party and you have a tsunami.

So it's kind of like buying options instead of the underlying stock. You can rig it so you increase your returns, if your predictions prove true. But if they don't, then you are really screwed. The interesting thing is like with options, you can rig things either way: You could pack fewer districts so they had 10% wins, and thus be assured of some presence in the new House. But maybe when your Party platform has a bunch of unpopular positions, you should go for 15%.

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