Tuesday, November 17, 2009

Support Main Street, not Wall Street

My rants against business are aimed at big giant corporations and the gigantic "too-big-to-fail" financial firms on Wall Street. I don't understand the big corporations that make millions or billions in profits, yet still lay off thousands. Why can't they bite the bullet for the good of the economy and make less money? Don’t they see the connection between unemployment and lower sales? I don't understand the thinking behind the huge bonuses on Wall Street, when it's the taxpayers that kept those businesses afloat. If they really earned those bonuses, why did we have to shell out almost a trillion dollars to keep them solvent? It is socialism! Socialism for the rich.

Yet, some of our local businesses here have been hiring! I know of a couple in my town of Batavia that have hired employees recently. I see people volunteering to help in my local community. I see people from "Main Street" USA trying to help the situation. I see very little of that same attitude from Wall Street or other big corporations. Why is that?

Support your local businesses. In the aggregate, they employ a lot of people. If there's innovation or a future high-flier, there is a good chance it will come from a struggling local business. Who would have thought a few geeks in an office in Albuquerque would turn out to be Microsoft and create thousands of jobs? And that one of those geeks would become the richest man on the planet?

3 comments:

Perplexio said...

I don't mind the big bonuses provided they're earned. The private sector has a right to operate their businesses as they see fit without government intervention.

I believe the bail-out was rushed and as such conditions for bail-out money that should have been implemented were left out. Any company that needs/needed a bail-out should have been/should be subject to pay freezes and freezes on bonuses until they've paid back all money received from the US taxpayers. This would both act as a deterrent from companies requesting bailouts (and force them to figure things out on their own without the help of the American taxpayers) and act as an impetus for those companies who accept bailouts to turn their company around as quickly and efficiently as possible so they can get back to their nice bonuses and all that.

I'm very leery of any economic system where success is capitalized and failure is socialized.

Also, I'm curious what is the interest rate the companies are paying on the money we've loaned them? Is there any interest on it?

The other "fix" I'd like to see is the separate social security account re-established (up until LBJ Social Security was in a separate acocunt that Congress couldn't touch) and Congress barred from touching it. Also any interest paid back to the US taxpayers on the bailout money would go into the Social Security account NOT the general fund.

Just some ideas.

Perplexio said...

Just a short PS. Actually I think you'd find much more agreement with your assessment than disagreement from the right. That being said, many on the right blame the trade unions and the snowballing salaries and pensions they've fostered to be the cause of the decline in manufacturing in this country.

When the big 3 have to spend as much money as they do on pensions and other benefits for union employees it hinders their ability to be competitive with their foreign counterparts (Toyota, Hyundai, Nissan, Honda, etc.)

I think the airlines are also an interesting test-case of this. Take for example United Airlines. In the 90s they were one of the largest airlines in the world (based on number of passengers per day). They were union owned. As a result the company by and large served the employees moreso than the customers. I think that came back to bite them in the butt a bit. When you add to that the events of 9/11... they kind of got a double whammy.

Kevin Moriarity said...

I think there's lots of places to lay blame - as with most things in life, it's more complex once you start thinking about it.