I still can't completely understand reasons for Occupy Wall Street movement. Only reason I can guess is "Frustration"!!! This is the only way people are expressing their frustration against Wall Street Companies and their "Excessive salaries and bonus" for their executives and top employees.. On top of that, the very same companies were bailed out by their own "People's Government" by their tax money... and same people were left behind by their own government.. That way it seems to be valid frustration!!!!
"Excessive"? Really? It is debatable..
Wall street argues back by saying that they have returned all the money with interest (zero percent?) back to government already. If they wouldn't have got government money common people would have even worse condition as they claim it would have create mayhem in main street companies as well.. (Well, if you do fraud, you do it so big that it will kill everyone around you not just you.. So government instead of punishing you should come and rescue you!!).
Moreover, Wall street is wide open to any one with talent and passion to work hard.. Most of these bankers are not their because their Dad or Mom are top officials of the company.. they are there because of their talent and hard work in Schools or elsewhere or somewhere.. it is wide open to everyone.. even to people who are spending time in these so called Occupy Wall Street movement.. Nobody is saying no or stopping these guys/gals to go and work for wall street and make millions.. it is their choice, they can waste their time here or do something which will help their career and help them come out of this situation...
Then there is big discussion going on about so called "Class War".. All thanks to Flat Tax rate war initiated by Republican Presidential Candidates.. On top of that.. report came out few days back that top Five percent rich people got even more richer and bottom poor people got even more poorer.. Essentially, divide between rich and poor is getting bigger and bigger.
How about overall standards of living for everyone.. have they gone up? I guess that they have gone up for majority of US citizens... though rate of change has been different for a different class.. It was definitely more for top income group simply because of world economy is more integrated.. If you are rich and little bit of interested in making money, you will take advantage of each part of world to make you even more richer..Where as bottom 5% of population, this benefit needs to percolate thru these Extra Rich and Rich folks.. Hence we have this wider gap in class and resulting so called class war..
However, the fact we might be missing is, that there is no certainty that this top five percent class is same over last couple of decades.. this class, especially in United States is pretty much dynamic and it is not hereditary or dynasty like it is still in many parts of the world.. Many of the billionaires are self made who were not even part of this list twenty or thirty years back.. That is the beauty of this system here. It is free and available to everyone.. If you have passion to become rich you will be rich.. you will figure out innovative ways to do so if you want to.. and with little luck and lot of hard work you will be part of this category, irrespective of the fact if your parents are lowest 5% or middle class or top 5%.. doesn't matter..
As far as Taxes are concerned.. there are different issues.. like top One percent income people pays forty or sixty percent of all the taxes.. and bottom forty or sixty percent literally don't pay any income tax.. Now how fair it is from rich guys perspective to tax them further..
At the same time under current situation any more tax burden on lower middle class or any discontinuation of benefit to lower middle class will look way too in-humane.. at least under current circumstances.. Also, lower middle class spends almost all of their income so they in-fact pay higher consumption or sales tax in ratio of their income.. Whereas rich hardly pay any consumption tax as compared to their income..
To me, under current circumstances, it feels like that we should leave current tax structure as it is.. when economy improves and has stable growth, increase tax slowly across the board to cover the massive deficit we are facing. Moreover, I totally disagree that you can spur growth by cutting tax or giving more short term benefits to employers.. If you want real growth then you need to set up proper environment, infrastructure and mode of society so that employers can be confident of growth.. Even if they have to pay few pennies here and there on these taxes they will hire people if they see growth.. They won't if they aren't confident of it whether you give them any amount of tax rebates..
"Excessive"? Really? It is debatable..
Wall street argues back by saying that they have returned all the money with interest (zero percent?) back to government already. If they wouldn't have got government money common people would have even worse condition as they claim it would have create mayhem in main street companies as well.. (Well, if you do fraud, you do it so big that it will kill everyone around you not just you.. So government instead of punishing you should come and rescue you!!).
Moreover, Wall street is wide open to any one with talent and passion to work hard.. Most of these bankers are not their because their Dad or Mom are top officials of the company.. they are there because of their talent and hard work in Schools or elsewhere or somewhere.. it is wide open to everyone.. even to people who are spending time in these so called Occupy Wall Street movement.. Nobody is saying no or stopping these guys/gals to go and work for wall street and make millions.. it is their choice, they can waste their time here or do something which will help their career and help them come out of this situation...
Then there is big discussion going on about so called "Class War".. All thanks to Flat Tax rate war initiated by Republican Presidential Candidates.. On top of that.. report came out few days back that top Five percent rich people got even more richer and bottom poor people got even more poorer.. Essentially, divide between rich and poor is getting bigger and bigger.
How about overall standards of living for everyone.. have they gone up? I guess that they have gone up for majority of US citizens... though rate of change has been different for a different class.. It was definitely more for top income group simply because of world economy is more integrated.. If you are rich and little bit of interested in making money, you will take advantage of each part of world to make you even more richer..Where as bottom 5% of population, this benefit needs to percolate thru these Extra Rich and Rich folks.. Hence we have this wider gap in class and resulting so called class war..
However, the fact we might be missing is, that there is no certainty that this top five percent class is same over last couple of decades.. this class, especially in United States is pretty much dynamic and it is not hereditary or dynasty like it is still in many parts of the world.. Many of the billionaires are self made who were not even part of this list twenty or thirty years back.. That is the beauty of this system here. It is free and available to everyone.. If you have passion to become rich you will be rich.. you will figure out innovative ways to do so if you want to.. and with little luck and lot of hard work you will be part of this category, irrespective of the fact if your parents are lowest 5% or middle class or top 5%.. doesn't matter..
As far as Taxes are concerned.. there are different issues.. like top One percent income people pays forty or sixty percent of all the taxes.. and bottom forty or sixty percent literally don't pay any income tax.. Now how fair it is from rich guys perspective to tax them further..
At the same time under current situation any more tax burden on lower middle class or any discontinuation of benefit to lower middle class will look way too in-humane.. at least under current circumstances.. Also, lower middle class spends almost all of their income so they in-fact pay higher consumption or sales tax in ratio of their income.. Whereas rich hardly pay any consumption tax as compared to their income..
To me, under current circumstances, it feels like that we should leave current tax structure as it is.. when economy improves and has stable growth, increase tax slowly across the board to cover the massive deficit we are facing. Moreover, I totally disagree that you can spur growth by cutting tax or giving more short term benefits to employers.. If you want real growth then you need to set up proper environment, infrastructure and mode of society so that employers can be confident of growth.. Even if they have to pay few pennies here and there on these taxes they will hire people if they see growth.. They won't if they aren't confident of it whether you give them any amount of tax rebates..
2 comments:
Agreed that the Occupy Wall Street is just frustration of the people, and there is no direction.
Still it is unfair that the bankers lost so much money of the people and still were left free. It is not about who can or cannot get into wall street. The question is whether there is an obligation for the government to ensure that people who commit crimes get punished.
This is where the government has totally abdicated its responsibility. So what do you expect will have happened do you think having the same people at the helm would improve the things in any way.
Some way the bankers should have been punished. I read of a very good idea by Nassim Taleb. The bankers should have been precluded from getting any bonuses. Since the banks did very badly under their supervision they don't deserve any bonuses.
Anyway USA is in a big soup. I read of Jefferson county declaring bankruptcy. Things are getting worse by the day. The USA survives on selling bonds. They will be selling another 2Trillions by the end of the year. How long will AAA rating stay?
I would say get yourself ready so that you can abandon it with minimum losses.
Thanks a lot Anand fro great comment.. Some of my thoughts again on this.. Even though I am more of anti-Big-Bank type of person.. Still from their perspective.. They did sank lot of main street money in CDOs and Financial Stocks.. They were force to take billiions or almost trillions of loan from US government during rescue.. But in the end US government got all its money back with interest and substantially higher dividend etc..
As far as common man loosing money, most of the money lost was by rich people who had invested in these stocks and bonds thru non-banking institution based investments (Hedge funds and what not).. Those investments always carry risk and you can't always make money on them..
Regarding US' bad situation.. It may is bad overall.. It has been worse earlier as well.. it has always come back.. this time it is different though and there are higher risks of coming back.. Biggest problem I feel is that US needs to understand that "no pain.. no gain" and there are no free lunches.. They need to work on basic policies.. Still there is great infrastructure and resources to progress.. It has to leverage them properly.. Bankruptcies of Counties and Cites keep coming.. not a big deal.. it is the local government's policies which needs better fiscal management.. In my view half of the cities and counties should file for bankruptcy and most importantly get rid of those lucrative labour deals and pensions for City employees..
I still feel, US is much better than most of the places for most of the people especially for intellectuals and people with growth drive.. there is nothing better than US if you want to innovate or want to make money.. It still has most fair and open environment for innovation and for business to thrive.. Just my thoughts.. Every place has it's own disadvantages.. Europe, Africa, middle-east, India, China... every one has some problem or other.. in most cases, bigger than what US has..
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