Free Markets, Free People

Welcome to "Backwardland" – political elite get it wrong … again

You’ve heard of "Flatland"? Well in Davos, we have "Backwardland", where elite politicians are talking about what ails the world. And you’re probably not going to be too surprised by this, but they’ve got it entirely backward.

Poverty and unemployment reared their heads at the World Economic Forum on Thursday, with speakers urging the elite audience to bridge a growing gap between booming multinationals and the jobless poor.

Greek Prime Minister George Papandreou, who also chairs the Socialist International group of center-left parties, said the global crisis had led to an "unsustainable" race to the bottom in labor standards and social protection in developed nations.

"Politically, I believe we are at a turning point where… there are signs in Europe of more nationalism, more racism, anti-Muslim, anti-Semitism, fundamentalisms of all types," he said. "We need to look to a different model."

Maurice Levy, chairman and chief executive of French advertising giant Publicis, said there was "a huge suspicion about CEOs, bankers, corporations."

"People do not understand that these large corporations are doing extremely well, while their lives have not improved and without the support of the people, there is no way we will be able to grow," he told a panel discussion.

"We have been led by greed. We have been led by only the bottom line, the profit and we have sacrificed the workers in order to please the stockholders."

If you’ve wondered why Greece is in the shape it’s in and France isn’t far behind, read this nonsense.  Greece didn’t get in the shape it is in because of corporations.  It is there because the government overspent on generous benefits such as early retirement and the like.   The financial situation of nations isn’t the result of corporate greed or income inequality – it’s because they’ve spent more than they take in, entitlements are out of control, and they’ve provided decades of disincentives to work.

And the nonsense wasn’t confined to Europeans:

Former U.S. President Bill Clinton said tackling income inequalities was essential to future growth and needed to be part of the core of doing business in the 21st century.

The core of doing business in the 21st century is no different than it was in the 17th century.  Good product, affordable price, satisfied customers.  What Clinton is really saying is that the left intends to use the excuse of “income inequalities” to clamp down on corporations, extort more in taxes (we’ve already discussed who really pays those taxes and how regressive that is, not to mention the fact that at some point, when those taxes can’t be passed along, the corporation goes location shopping or dumps jobs) and generally kill the goose that laid the golden egg.

U.S. economist Nouriel Roubini predicted a backlash against budget cuts in Europe if there was no rapid return to economic growth.

Well yes, but again, with the plan that seems to be afoot, that’s almost assured, isn’t it?  What this is, again, is a different approach to collectivizing corporate earnings.  Terms like “income inequality” and “social justice” creep into the conversation.  And “share” – you remember “share” as in “share your toys, little Johnny”.  Well now it is time, say the elites, to “share” what hasn’t been earned by those receiving the “share”.

With unrest in Tunisia and Egypt a major talking point in Davos, Mthuli Ncube, the Tunis-based Chief Economist for the African Development Bank, predicted more trouble ahead if the fruits of growth were not shared more evenly:

"If you are not even creating jobs, not even sharing the economic growth that is coming through, then there will be push-back," he said. "It’s one thing to get good growth going. It is another to share that."

It is indeed – but here’s something that has worked throughout economic history: get good growth going, create jobs with profits and suddenly it is being “shared”.  Tax the crap out of anyone or anything that looks like it is making money and you won’t get growth, you won’t create jobs because the profits won’t be there to support either.

Of course what Mthuli Ncube is talking about is “sharing” through government – they’ll take it and dole it out.  Oh, and by the way, the unrest in Tunisia wasn’t driven by a backlash to “corporate greed”, it had to do with government greed and oppression.

This is the not so new approach by the left to use the financial crisis as an opportunity to loot corporations and support the welfare states that are in big trouble.  Demonization is right around the corner.  The real cause of the unrest among those the leftist elite like to use as their pawns has little if anything to do with corporations and a lot to do with the governments most of these boobs represent.



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23 Responses to Welcome to "Backwardland" – political elite get it wrong … again

  • U.S. economist Nouriel Roubini predicted a backlash against budget cuts in Europe if there was no rapid return to economic growth.

    Yep, the old, old Collectivist meme…  IF markets really work, they have to work instantly…and never mind the overburden of crap that has bastardized them…or else it is evidence that markets are really bad.
    But, really, what can you expect from a gaggle of “world leaders” all imbued with the same BS?

    • More charitably, he could mean that the backlash against budget cuts would occur because the bondholders and banksters did not take a hair cut. Bailouts is not exactly the market working either.

      • Correct!  If he meant that, he is a champion of misstatement, though.
        Dare I say that bailouts are consistent with fascist economics?  Yep.  I dare…  The compliant BIG BUSINESSES get the payola, suspending the rigor of the market.  (See Franks and Dodd…Financial Reform.  See also Banking Whores, Biggest)
        But then, Chrysler and GM bond holders…mom and pop, screwed to the wall in favor of BIG COMPLIANT UNIONS.

  • It wouldn’t seem so sinister if they were talking about an actual redistribution of wealth, ie taking from the wealthy and giving to the needy.  Stupid, yes.  But not sinister.  This seems sinister because it sounds less like taking from the wealthy to give to the needy, and more like taking from the wealthy to centralize wealth and power in the hands of greedy politicians.  How many of the world’s most horrible dictators started off by publicizing the plight of the poor and the heartless greed of the corporate elite?

    • HUG-ohhhhhh Chavez, call for HUG-ohhhhhh Chavez

      • Hell, Nancy Pelosi “Friend of working people”!!!

        • UN Secretary General Ban Ki-moon on Friday called on the United States and Europe to take the lead in combating climate change, rather than waiting for others to act. “This climate change campaign should be led, must be led by developed countries. This has started from industrial revolution, and the United States and European countries they have to be morally, politically responsible,” Ban told world elites gathered at the Davos meeting of the World Economic Forum. “The United States as a largest economy and superpower, this superpower of the world should take the political will, political leadership and invest in it,” he added.

          Let’s just “moon” him … he’ll just “ban” it.

  • Giving in to extortion is not a long term growth model.

  • And nothing changes. These sophisticated world leaders are actually no different qualitatively from the earliest despots to arise in the Mesopotamian city states.   They take from whomever has a little wealth, then they throw crumbs out to the populace in order to stay in power.

    All their economics, theories, and rhetoric do not change that fact.

    • We have an absolutely empirical model.
      The “War On Poverty” has worked enormous harm on all the people of the U.S., but on no group more than those it putatively was supposed to help.

      • But whether it worked poorly or not at all, it was never really designed to help the poor, it was designed by that cynical old racist bastard LBJ to buy his party votes.  Which was my original point.

      • My absolute favorite part of the war on poverty was/is urban renewal. I used to drive through DC fairly often, through run down neighborhoods of single family homes. Along comes urban renewal and all those neighborhoods of single family homes were replaced by high-priced condominiums. They looked very nice, but I wondered where the previous inhabitants of the neighborhoods had gone.
        Some time later, having had occasion to travel through another part of DC I found out where they had gone- high-rise “projects”. Not only had the poor, black folks been forcibly moved into less physically desireable housing but their social structure had also been destroyed. No more neighbors, just other people you meet in the hall occasionally.  

        • As was the case in many urban areas.  With “public spaces” designed by “brights” that became killing fields at night…where even cops would not venture.

        • But the golden boys always know better how the proles should live, just shut up, vote for us, and eat your government cheese.

  • “We have been led by greed. We have been led by only the bottom line, the profit and we have sacrificed the workers in order to please the stockholders.”

    Amost right, except that the stockholders were also sacrificed.

  • Correctly applied, there is NOTHING in history that has benefited…or would benefit…humanity more than this–
    We have been led by only the bottom line

    • There is a quote I have been trying to remember, something about how there is nothing more beneficial to others than someone engaged in making money. Very rough.

  • Once again, we see a fundamental failure of lefties to understand what businesses, whether tiny “mom and pop” outfits or huge multinationals, are FOR.  They think that businesses exist to hire people and pay them good wages and benefits.  Wrong: they exist to make money for their owners.  It so happens that they often (but not always) have to hire employees to operate, and it may be that competition for good employees leads them to pay good wages and benefits, but they don’t exist for this purpose.  Blaming businesses for not hiring people is like blaming consumers for not buying something that they don’t want or need.

    Come to think of it, lefties don’t understand what government is for, either.  They think that its a instrument for transferring wealth and “taking care of people”.  Wrong: governments exist to promote an orderly, safe, law-abiding and hence peaceful society.  Robbing Peter to give to Paul (usually in the interests of getting Paul’s support for the ruling class) is antiethical to this as, cloaked as it may be in high-flown terms like “social justice”, it is still theft.  Lefties used to be fond of claiming that “you can’t legislate morality” (usually when they were being stopped doing something that they like, such as getting abortions or smoking pot).  Now, they are totally into the morality business: you WILL give to your fellow man or you WILL go to prison.

  • Liberal vs Tea Partier in a crisis, how do they handle the signs: