It looks like the bailout funds will be mostly used to consolidate rather than pluralize the financial sector. Easily predictabe.
The economic model of efficiency being used is "bigger is better" which translated means "bigger is too big to fail" and receives public funding to consolidate and cause more crisis for more funding.
The current price on this risk is greater than $700 billion with a perfect probability of failure at 100 percent. I guesse we can't accuse our elits of not striving for perfection.
The bigger the firm, the more likely, if not certain, it will leverage risk for a magnified return, which caused the crisis we are now in. Banks will not be in the business of risking capital to grow the economy--lending to The People and their businesses--but to leverage a pure profit by bidding up futures contracts, straddling rate spreads and securitizing the risk into inscrutible value with bogus marks to the market.
The bureaucratic managers to discharge the TARP are sector executives that are likely to price the risk based on returns for the private sector and the consolidation of market share, recycling crisis with the legitimacy of public authority.
Instead of better products, services and prices, the consumer is financing an organization inimical to its interests.
Instead of financing a competitive multiplicity of the marketplace in which risk is priced in terms of the best value for the customer (The People), the risk is priced to shift it all it to The People with the least possible benefit and the greatest gain for the private corporate entity, thereby securing exploitation of The People, the perfect probability for crisis, and the public funding that it causes, all with the legitimacy of public authority which is defined by the consent of the governed.
The risk is priced out of the market and into the public domain so that the accountability is all with a bogus consent of the governed. The risk is priced by dumpimg all the cost into the public domain. The result will be crisis and the need to service the inefficieny of "bigger is better" with public finance, always being supported as the confirmed model of efficiency with the empirical verification of the huge amount of public money spent to bail it out, and preserve it, by popular consent.
The People's capital needs to invest a deconsolidation of industry and markets, not pay for the organized means for The People's deprivation.
Obama/Biden 2008!
Showing posts with label public finance. Show all posts
Showing posts with label public finance. Show all posts
Tuesday, October 28, 2008
Thursday, June 12, 2008
Technical Correction
Correcting for the Whipsaw
There needs to be a technical correction on income.
The whipsaw is your income going down while costs go up. The result is a redistribution of income that, by a free market legitimacy, is supposed to add supply to control inflation at full employment which is created by the investment to add the supply (liquidity of capital).
The technical measure for correction is a progressive income tax code with no exceptions. The measure will not cause a budget deficit. It will cause a budget surplus. A regressive income tax code causes a budget deficit in every case across all jurisdictional boundaries.
While the detriment of the tax rate progresses, that progression also has the benefit of the highest incomes being assured payment of the public debt held in the highest proportion. Figuring in a risk-free payment of the debt on a declining rate of infaltion is a substantial benefit that more than offsets the loss of the tax increase. The argued inequity and detriment of the progressive tax increase is entirely false.
The Pareto Optimality of the progressive income tax measure is Strong Positive.
The technical correction to income will not interrupt or materially change the productive incentive of a free market mechanics. Rather it will both restore the mechanism and correct for its absence where the distribution of capital was allowed to consolidate into a liquidity crisis of massive proportion. The corrective measure will technically add the liquidity necessary for economic recovery and sustainable economic growth.
The role of the Federal Reserve will be reduced to ensuring the free market mechanics of the financial sector. Adding liquidity will be in large part rendered progressively obsolete being provided for in priority. Violators of the free market mechanism will be strictly prosecuted and convicted by the Department of Justice with the burden of proof on the defendant to show no violation, like it is now with any alleged tax code violation strictly enforced through Treasury and Justice.
Build the coaltion for Obama, and let the technical correction begin!
Very best wishes.
tags:
technical correction,progressive income taxation,free market economics,adjusting for externalities,public finance,election 2008
There needs to be a technical correction on income.
The whipsaw is your income going down while costs go up. The result is a redistribution of income that, by a free market legitimacy, is supposed to add supply to control inflation at full employment which is created by the investment to add the supply (liquidity of capital).
The technical measure for correction is a progressive income tax code with no exceptions. The measure will not cause a budget deficit. It will cause a budget surplus. A regressive income tax code causes a budget deficit in every case across all jurisdictional boundaries.
While the detriment of the tax rate progresses, that progression also has the benefit of the highest incomes being assured payment of the public debt held in the highest proportion. Figuring in a risk-free payment of the debt on a declining rate of infaltion is a substantial benefit that more than offsets the loss of the tax increase. The argued inequity and detriment of the progressive tax increase is entirely false.
The Pareto Optimality of the progressive income tax measure is Strong Positive.
The technical correction to income will not interrupt or materially change the productive incentive of a free market mechanics. Rather it will both restore the mechanism and correct for its absence where the distribution of capital was allowed to consolidate into a liquidity crisis of massive proportion. The corrective measure will technically add the liquidity necessary for economic recovery and sustainable economic growth.
The role of the Federal Reserve will be reduced to ensuring the free market mechanics of the financial sector. Adding liquidity will be in large part rendered progressively obsolete being provided for in priority. Violators of the free market mechanism will be strictly prosecuted and convicted by the Department of Justice with the burden of proof on the defendant to show no violation, like it is now with any alleged tax code violation strictly enforced through Treasury and Justice.
Build the coaltion for Obama, and let the technical correction begin!
Very best wishes.
tags:
technical correction,progressive income taxation,free market economics,adjusting for externalities,public finance,election 2008
Tuesday, February 26, 2008
Health Care is Not a Demand-Side Problem
Health Care is Not a Demand-Side Problem
The cost of healthcare is a supply-side problem.
Considerable time is being spent arguing costs are entirely demand driven. It is not! This argument is nothing but part of a scheme to rig the market to limit supply to support the costs (the profit margin). It is a pro-profit argument, like Reaganomocs, not pro-growth.
Yes, demand is strong and relatively inelastic. In other words, one unit increase in price does not result in a decrease in demand. Everybody needs health care. This is the perfect condition for abusive pricing and fraudulent practices that comes with minimizing market forces and maximizing public finance. It is also a strategic market for taxing the value added and reinvesment by means of public finance to increase the supply to meet the demand, thereby controlling the costs.
The sector charges largely whatever it wants and the government pays it. There is currently some control, but it is very weak because of the revolving door and requires a huge government bureaucracy, adding to the cost. They know that if the government does not pay it, the cost will be dramatically reduced because if no one can afford you, and you do not lower your prices, you do less business, and your income is dramatically reduced.
More focus needs to be placed on supply-side measures--all the things health care professionals and entrepreneurs do not want to talk about or dismiss as either unprofessional or detrimental to quality, like market forces--a competitive multiplicity in the marketplace. The arguments against market forces here are the same used during the robber-barron era of economic trusts: market competition is wasteful, crude, unsophisticated and diminishes quality and innovation--all of which is just a lot of self-interested nonsense being sold as the general welfare.
Economic pluralism is what the health care industry does not want and has the money (the value added) to prevent. The focus is on demand, and if your lifestyle does not meet the prescribed measure of health, you are not being sufficiently taxed to cover the cost. This could not be more tyrannical!
The jig is up!
If you want to control health care costs, here is how you do it.
The first step is to tax the value-added for reinvestment in growth (supply) rather than consolidation. The value added (the profit margin) is a market solution that a consolidation of capital tends to not allow. Investment in the added value as a measure of what we want and need, like healthcare and energy, is what gives free markets the force of cost-effectivness, efficiency, and legitimacy. It is the role of government to be sure it is fully operational.
The Treasury has a leading role for strategic, supply-side reinvestments. The legislature identifies the value-added markets and enables it through the Treasury. The Federal Reserve, our nation's prime lender, reacts to the disinflationary effects of added supply, rather than the deflationary effects of consolidating the added value. The result is a pro-growth, downward pressure on rates. Instead of encouraging inflation, like we have now, the Fed is encouraging growth, adding to the supply side.
Government is just as easily opeationalized to ensure affordable market solutions as it is to limit it.
The general-case solution statement of maximizing market mechanics will result in higher incomes and lower costs. This is the formula for making health care more affordable. It has nothing to do with diminished professional standards, quality, or any particular lifestyle. If that bag of potato chips does not kill you, something else will.
It is not because you are too fat, or because you smoke too much, or you drive an air polluting car.... Health care costs are so high because the market is rigged to maximize demand and the taxes to support it, and minimize supply so that costs are projected to be a $5 trillion expense by 2011.
Controlling the costs of health care is entirely possible, and instead of being an economic detriment, it is the demand for growth that drives a healthy economy.
Copyright 2008 by Griffith Lighton
The cost of healthcare is a supply-side problem.
Considerable time is being spent arguing costs are entirely demand driven. It is not! This argument is nothing but part of a scheme to rig the market to limit supply to support the costs (the profit margin). It is a pro-profit argument, like Reaganomocs, not pro-growth.
Yes, demand is strong and relatively inelastic. In other words, one unit increase in price does not result in a decrease in demand. Everybody needs health care. This is the perfect condition for abusive pricing and fraudulent practices that comes with minimizing market forces and maximizing public finance. It is also a strategic market for taxing the value added and reinvesment by means of public finance to increase the supply to meet the demand, thereby controlling the costs.
The sector charges largely whatever it wants and the government pays it. There is currently some control, but it is very weak because of the revolving door and requires a huge government bureaucracy, adding to the cost. They know that if the government does not pay it, the cost will be dramatically reduced because if no one can afford you, and you do not lower your prices, you do less business, and your income is dramatically reduced.
More focus needs to be placed on supply-side measures--all the things health care professionals and entrepreneurs do not want to talk about or dismiss as either unprofessional or detrimental to quality, like market forces--a competitive multiplicity in the marketplace. The arguments against market forces here are the same used during the robber-barron era of economic trusts: market competition is wasteful, crude, unsophisticated and diminishes quality and innovation--all of which is just a lot of self-interested nonsense being sold as the general welfare.
Economic pluralism is what the health care industry does not want and has the money (the value added) to prevent. The focus is on demand, and if your lifestyle does not meet the prescribed measure of health, you are not being sufficiently taxed to cover the cost. This could not be more tyrannical!
The jig is up!
If you want to control health care costs, here is how you do it.
The first step is to tax the value-added for reinvestment in growth (supply) rather than consolidation. The value added (the profit margin) is a market solution that a consolidation of capital tends to not allow. Investment in the added value as a measure of what we want and need, like healthcare and energy, is what gives free markets the force of cost-effectivness, efficiency, and legitimacy. It is the role of government to be sure it is fully operational.
The Treasury has a leading role for strategic, supply-side reinvestments. The legislature identifies the value-added markets and enables it through the Treasury. The Federal Reserve, our nation's prime lender, reacts to the disinflationary effects of added supply, rather than the deflationary effects of consolidating the added value. The result is a pro-growth, downward pressure on rates. Instead of encouraging inflation, like we have now, the Fed is encouraging growth, adding to the supply side.
Government is just as easily opeationalized to ensure affordable market solutions as it is to limit it.
The general-case solution statement of maximizing market mechanics will result in higher incomes and lower costs. This is the formula for making health care more affordable. It has nothing to do with diminished professional standards, quality, or any particular lifestyle. If that bag of potato chips does not kill you, something else will.
It is not because you are too fat, or because you smoke too much, or you drive an air polluting car.... Health care costs are so high because the market is rigged to maximize demand and the taxes to support it, and minimize supply so that costs are projected to be a $5 trillion expense by 2011.
Controlling the costs of health care is entirely possible, and instead of being an economic detriment, it is the demand for growth that drives a healthy economy.
Copyright 2008 by Griffith Lighton
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