There have been a few things lately that seem to have given America a push toward Socialism. Now don't get me wrong, I realize we are still a long ways aways from Socialism, but I couldn't help notice a few things.
Let's start with President Bill Clinton. Clinton made regulations that made banks lower their lending standards to give out loans to people that would have previously been denied. In other words, the banks had to give out money to poor people which they knew would probably not be able to pay it back. It was either the banks gave out high risk loans, or answer to the government.
Now, strangely enough, the banks are asking for bailout money, which comes out of our tax money. Who's fault is that, is a hard and long one to answer (from Clinton, to Bush, to Congress, etc.). Luckily (or unluckily), Obama has given some of the banks bailout money, which in its self is anti-capitalistic, but also put a restriction on how much the executives could make. Uh... Socialism. Some of those executives were making tens of millions of dollars a year. Obama brought them down to $500,000. Is that fair? Obama said, it's not right for those businesses to be paying their executives all that money and yet lay people off. I know this my sound bad but why? Capitalism is a dog-eat-dog world. Get better, or go home hungry. Obama also wants to take their private jets away. That's pretty lame. Um... That's the executive's, who by the way are pretty important, means of transportation.
I realize some of us will think, "ya well they didn't need all that money." But your missing the point, the government shouldn't restrict how much we get paid. Okay, say the executives got paid $10,000,000, and are now getting paid $500,000. That's a 95% pay cut. Okay, let's say you work for $10/hr. 40hrs. a week for 52 weeks. That comes out to $20800 (before taxes). Now, if you had to abide by the same rules, you would only get $1040 before taxes a year. That doesn't seem fair now does it.
Now, I will be fair in saying that if Obama takes off the restriction after the banks pay back the bailout money (with interest of course), then I would totally agree with his decision of restrictions. If I were Obama, I would be worried that the banks would ask for free bailout money, and then just stick it in their pockets. But if the restrictions were just part of the deal for money it would turn more capitalistic, because it would be just like taking out a loan, with more restrictions in the contract.
I could write a lot more to fill in all my loop holes and gaps of information, but my blog would turn into a book haha. Maybe I'll add on next time. Anyway, asking a few friends what they think, they said that they would be up for socialism, as long as they weren't affected. Isn't that the truth haha. So I'm curious to know what you think. Socialism or Capitalism? Why or why not? And if you have any newer up to date information that you don't think I have, feel free to let me know.
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So far I have enjoyed your blogs because they have posed some interesting questions.
ReplyDeleteAh, Socialism. It is a scary sounding word to many Americans, but it really shouldn't be. There is a lot to be said for Socialism. For instance, socialized health care. I have two degrees, will be paying off student loans for most of my life, work full time between two colleges, but I don't get health coverage. If I want health coverage, I have to pay for it myself, which sometimes I am able to do. But if I get a class cut during a given semester, I have to cancel my health coverage too because I just can't afford it. Three of my closest friends and my aunt and uncle also do not have health coverage, et they all work full-time jobs and pay plenty of taxes. If America is so great, how come so many Americans can't afford to get sick here?
With that said, I think the ideal system is a combination of Socialism and Capitalism. I don't agree 100% with the salary limitations for CEOs, but how can those CEO justify their million dollar salaries when their companies are going out of business?
My final comment is just to point out the the bank bailouts (for Fanny and Freddie, etc.) were done under the Bush administration and not by Obama. I don't necessarily agree with all the Obama-proposed spending, but the bank debackle was not of his doing.
The top 2% of taxpayers in the United States already pay 80% of the nations taxes. So it's not really a question of rich vs poor, it's more a question of money management. In theory, things like socialized health care should work, but it would require perfect distribution of funds for such a dynamic project, and yet any government systems, (particularly socialistic systems), are ineffective at achieving even the smallest milestones in government programs. Canada's health care system is apparently great or something, but the lines are so long its almost a lottery to get treatment or prescriptions. Not to mention that there's almost no incentive there anymore to work in the health care profession, since doctors have to work at the mercy of a government paycheck.
ReplyDeleteOh and an ironic thing is how different people in the government are trying to "fix the recession." Recessions are part of the cycle of any economic system, and pumping fiat money into a recession only prolongs it.