The Wall Street Journal has been keeping me up-to-date on Michael Dell’s attempt to take the company he founded private.
This morning’s installment of the saga was headlined, “Michael Dell Finds His Deal, And Job, in the Cross Hairs.” An excerpt:
Michael Dell‘s DELL +2.62% plan to gain greater control of his company and take it private began to backfire, as rival bidders for the computer maker floated competing offers that, if accepted, could leave him out of a job.
Blackstone Group LP BX -0.41% and activist investor Carl Icahn delivered separate proposals to a special committee of Dell Inc.’s board before a key deadline for offers expired, people familiar with the matter said. Blackstone has been exploring the possibility of someone else leading the company, according to a person familiar with the matter.
But you know what? I’ve just gotta confess that it’s tough for me to be on pins and needles about the possibility of poor Michael losing his job.
Those of you who understand high finance might set me straight here, but near as I can tell, if he “loses” this fight, he walks away with one of the best severance deals in the history of the planet. His bid is for $24.4 billion. Presumably, the winning bid would be comparable. He controls about 16 percent of the stock.
Of course, a job is about more than money. There’s job satisfaction. There’s one’s place in a community; one’s sense of making a contribution.
But don’t you think the best days for all that are sort of behind him? How will he ever repeat the heady days of founding the company in his dorm room, and seeing it rise to where “Dude, you’re getting a Dell!” was all the rage. Now, the company, and the industry of which it has formed a prominent part, have seen their best days.
Mind you, I am sort of rooting for his bid to take the company private, just on general principles. I say this on the basis of my own experiences working for publicly-traded companies. If I were in his position, I’d want to be private, too.
But I can’t help thinking that for him, personally, the best thing might be to lose his job. Then he could take his cash and go out and do something new and exciting. Or just chill. There’s always that option.
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“Then he could take his cash and go out and do something new and exciting. Or just chill. There’s always that option.”
Not if bud has any say about it. Michael Dell didn’t earn the money he made from the company he started from scratch. He (and ESPECIALLY his hiers) have no right to keep the money that people will pay him to leave. Why any fool with a screwdriver and a hard drive can make a computer just like Dell did. Dell was just lucky. Just one lucky event after another since 1988 (when DELL stock was trading at an adjust 8 cents a share versus today’s 14.50). Dell just built that first PC and the rest was just sitting back and watching his business grow like a Chia pet. No skill required. No effort required. No tough decisions to make.
That bastard. That money could be used to help the Columbia bus service.
With all that money Michael could set up a real life Bull vs. Grizzly Bear battle to settle the argument between me and Silence. The bull would totally win.
Bryan – Michael Dell would never set up that battle, because he knows that it’s a lock for the bear to win. Much like how “Steven” the “Dude, you’re getting a Dell” guy whipped up on “Gateway” the “We ship our PC’s in cow boxes”.
No, a fool with a screwdriver could not have done what Mr. Dell did. Neither could the person who invented the wheel, or the person who figured out how to make her own fire. So much rides on what your resources are.
It isn’t just that Dell is out of touch with the times, since tablets and smartphones are undercutting desktops. It’s also that his “make it cheaper than anyone else” model has been shown to be something less than a universal law, by Apple and Samsung among others.
Clearly the vast majority of Michael Dell’s vast wealth is the result of blind luck plus the fact that he lives in a nation that rewards the lucky to such a vast extent. Sure Mr. Dell worked hard and he was smart enough to build a decent computer back in the day. Lots of guys were just as capable of building just as capable a computer. But Dell had to have some good fortune along the way to accumulate the super wealth that he has. To suggest otherwise is ridiculous. (At least he didn’t inherit it like the Walton family). Given that he is now set for life doesn’t it seem reasonable that he give back to the system that allowed this to happen? At the very least let’s start taxing capital gains and dividends at the same rate as wages. Plus the top income bracket should be about 50% and tax loopholes closed. Otherwise we might end up with the highest wealth inequality in the world. As it is we’re pretty close to the highest GINI in the OECD. Since 40% of all Americans have zero or less net wealth it seems like we’re in a dangerous position that can only lead to ruin. And that goes for folks like Mr. Dell who can afford to give back to a nation that has served them so well. Here’s a nice article that shows just how broken our current system is:
http://truth-out.org/buzzflash/commentary/item/17878-america-split-in-two-five-ugly-extremes-of-inequality
Yes, many other folks could have started assembling computers in their dorm rooms. Many other folks did. I guess Mr. Dell just got lucky, was all. Now we should punish him for his success, and redistribute some of that accidental wealth to the unlucky folks who through no fault of their own spent all of their money on rims, a bumpin’ stereo system, tatoos, gold teef, cigs and booze.
I hope he puts his wealth into hiring lobbiests to push for a 10% national sales tax and the elimination of income tax. Tax what you spend, now what you earn.
@Bud
He already “gave back” a million times over. How many people owe their livelihoods to the fact that Michael Dell created a business that allowed them to have high paying jobs with good insurance over the course of the past 25 years? Easily hundreds of thousands of people. How many people got rich by buying DELL stock when it was at an adjusted 8 cents? Tens of thousands. All those people have paid hundreds of millions in taxes already.
He did it. He earned it. He paid millions in taxes over the years. He should be able to keep every single penny he has earned.
Well bud, it is obvious why you liked the article so much. The source is a website that is basically socialist/communist oriented and literally demands redistribution of wealth, like the position of the president.
It bashed another Koch brother who increased his wealth by $6 billion last year. What the article failed to do was to identify other billionaire’s who increased their wealth substantially, especially the king of wealth in America, Bill Gates. Gates increased his wealth by $6 billion but not from Microsoft. He increased his wealth through, “gasp”, investments and the stock market. Koch earned his by investing in exploring and bringing our natural resources, i.e., natural gas and oil to the market along with modernizing several of Koch Industries industrial facilities. And, the awful Koch brothers actually employ over 50,000 people in the USA and over 20,000 abroad.
The article didn’t mention Mr. Buffet either yet Mr. Buffet increased his holdings by acquiring Heinz, several newspapers, and other holdings thereby increasing his wealth substantially.
Yet, the article was centered on a Koch brother but didn’t bother to mention one liberal, progressive, or Democrat on the long Forbes list of billionaires who earned “obscene” profits or income last year. I really don’t have a problem with anyone taking a position on the issue but at least let it be “fair”, one of the president’s favorite words.
Now we should punish him for his success, …
-Silence
That’s your typical boilerplate, and nonsensical, comeback to the whole issue of wealth distribution. No one wants to “punish” anyone . Punishment would require some sort of incarceration or fine. I don’t propose any such thing. Rather I’m suggesting a change in the tax code to reflect the very real situation that wealth is increasingly concentrated in fewer and fewer hands. Conversely more and more people are unable to make a decent living. Many of these folks work very hard and long hours yet are unable to accumulate any wealth at all. So if you want to talk about “punishment” lets talk about the “punishment” inflicted on the poor and increasingly middle-class folks in this country. They are the real victims, not someone like Michael Dell.
He did it. He earned it. He paid millions in taxes over the years. He should be able to keep every single penny he has earned.
-Doug
Here’s where the cognitive divide is too wide to bridge. I agree that Mr. Dell should keep every single penny he’s EARNED. Where we differ is I don’t believe he’s actually EARNED more than a couple of million. The rest is due to pure “luck”. I can’t convince you that is true. And you will never, ever convince me it’s not. The evidence is just overwhelming that I’m right on this. It’s sort of like arguing with a young-earth creationist. No matter what evidence you present they will alway believe the entire universe was created 6,000 (give or take a couple thousand) years ago. The “luck” portion of his wealth should be taxed heavily and invested in American infrastructure and ultimately in jobs.
How is it “pure luck” when a new concept catches on and the entrepreneur is rewarded with a high volume of sales and is able to expand into a multi-billion dollar a year international corporation? This is what Dell did when he was a student, operating out of his dorm room. No bud, this is not an example of “pure luck”, it is an example of someone with enough vision to realize that he could build a personal computer to meet the specific needs of the individual and do it on a mass production basis. His first computers were components built by others but eventually, Dell had their own components manufactured to their specs. On this one, you are out of your league with Doug or me. Both of us have been involved with the industry for decades, we are not novices. It was not luck but vision and the willingness to commit to it.
“Pure luck” is the recent Powerball winner of $338 million. Using your logic, how much more of his lottery winnings should be taxed over the usual amount? There is a MAJOR difference between the guy from New Jersey and Mr. Dell from Texas.
But if you will quantify your overwhelming evidence, I may be willing to agree with you. And if you can quantify it, how do you propose determining what portion of his wealth should be considered “earned” and what portion is “pure luck”?
I would only make a few changes to the tax code to address the situation with the super rich:
1. Add a new tax bracket – 50% for ever dollar over $2m/year
2. Limit tax deductions to $75k/year (Romney actually suggested something like this.
3. Eliminate tax deductions for second homes and corporate jets
4. Tax ALL income the same, regardless of the source.
5. Eliminate overseas tax havens.
@Bud
An economist would ask you to review each of your proposals and try to come up with the unintended consequences of each one.
For example, limiting deductions to $75K would certainly impact the real estate market, particularly for high end and vacation homes. Property values would decrease thus dropping property tax revenues. Small businesses that cater to high end customers (landscapers, pool cleaners, granite counter top installers, etc.) would see a drop in their business as a result which would again decrease income tax revenues.
Every tweak you attempt to make would have an impact somewhere else in the economy.
The best solution to income inequality is education and initiative. Anything else is just socialism and redistribution of the wealth of people who earn it.
bud -1) the super-rich have already generally accumulated their wealth. Taxing income won’t get most of them. Warren Buffet is one of the richest men in th world, he pulls a salary of about 100k annually, and sits on his $100 billion worth of BRK.A shares. By not selling them, he doesn’t generate any taxes on his wealth. The bulk of his shares have been pledged to the Gates Foundation, so maybe he’s a bad example, but nonetheless, his taxable income is very low, and his wealth extreme.
2) Which deductions are you going to limit? All of them? Good luck with that, because you’ll put most of the 501(c)3 charitable organizations out of business. They thrive on large contributions from wealthy donors. It’s basically a non-starter.
3) I’m OK with eliminating the mortgage interest deduction for second houses in theory, but that would hit me in the wallet. Corporate jets are just like any other significant piece of business equipment and should be amortized across the useful lifespan of the item, same as if you owned a bulldozer or a bus.
4) Agree to disagree on this one. Investment income carries a level of principal risk that wage income does not, and offering lower rates on dividends and capital gains is an enticement to put capital to work in the economy.
5) Explain to me exactly what you mean by “overseas tax haven”? I don’t think they exist.
An economist would ask you to review each of your proposals and try to come up with the unintended consequences of each one.
-Doug
That’s a fair question. But my point is that we already see the damage done by concentrating wealth into fewer and fewer hands. It is creating a class of people, and a rapidly growing one at that, who have absolutely no wealth. That is the result of the policies that conservatives like Doug staunchly defend. So what Doug is suggesting is what we do now and it is failing right now. I say let’s try something else. Frankly the suggestion that folks aren’t accumulating wealth because they are uneducated and/or lazy doesn’t make sense given that folks are both (a) better educated than ever before and (b) work longer hours than ever before. Bottom line, the more conservative our policies the worse off our nation becomes.
I don’t say what we do now is right. I say what you suggest is worse.
The problem with the tax code is not rates, it’s complexity. Every line of code results in people and companies making decisions to minimize their tax bill. It creates an unproductive environment that wastes money on enforcement, compliance, and reporting.
For example, I got my tax return from my CPA last week. It was 121 pages of forms. 121 PAGES! And it cost me $750 to have the return created. For what? Many of the pages were related to some transactions that were done in a brokerage account that generated a K1 form. A 6 page form showing maybe a couple hundred dollars of income and then that income is split across many states. I have no clue how it works, if it is correct, or why it is necessary.
One only needs to look at a typical 1040 form for the state or federal government to understand just how screwed up our government is. If there is a stupid way to do something, it will surely be implemented in the tax code.
I’ll never understand why South Carolina’s Department of Revenue acts as a collector of contributions to dozens of charities. There are fifteen separate checkoffs for donating money to things like the Endandgered Wildlife Fund and War Between the States Heritage Trust Fund. That should be eliminated immediately. These are all some legislator’s pet project.
Pure stupidity for this to ever have been implemented in the first place.
Interesting, because I recently read about the explosion of millionaires in this country.
bud, you want to try something else… like what they tried in the USSR, China and North Korea?
Are those people in Section 8 housing really working longer hours? Since when did sitting on a couch become “work”?
For example, limiting deductions to $75K would certainly impact the real estate market, particularly for high end and vacation homes. Property values would decrease thus dropping property tax revenues.
-Doug
That comment is just dripping with irony. In 2008 we actually had a huge collapse in the real estate market causing property tax revenues to drop. And guess what caused it? It was the damn super rich, greedy, unregulated, free market, capitalist, conservative bankers. That’s what caused it. Not a limit on tax loopholes. Once again we have an example of a conservative/libertarian policy that was tried and it failed and failed miserably.
Or a regulatory system that encouraged lending 100+% of home values regardless of credit-worthiness and a public belief that asset prices would never fall. Allowing banks to shift risk onto FNMA and bond investors was the big problem. Make banks and mortgage brokers have skin in the game. Don’t allow them to securitize 100% of loans. Remove the government guarantees for Fannie and Freddie. Make banks hold some portion of the loans on their books, or take the first 10% of loan losses. Bring back the 20% down standard for mortgages. If they actually are holding the loan, they’ll be a lot more careful about who they lend money to, and how much.
I think it’s just “the man” holding a brother down.
bud, didn’t the Democratic city leaders in Columbia just purchase a piece of property for $5.65 million that sat empty for 20+ years and did so on a simple vote with no appraisal? For all we know that property is worth $1 million. Are the Columbia city leaders ” the damn super rich, greedy, unregulated, free market, capitalist, conservative bankers” buying property with disregard to city taxpayers money?
No, Steven. They aren’t bankers, they are lawyers.
There’s always money to be found when they need it. Couldn’t find millions for the bus system without raising the sales tax though. That was impossible.
But when an old brick building is going to be torn down the money magically appears.
I hear water/sewer rates are going up 8%, but they also voted on how much they can steal from that fund to fund other projects each year.
Anyone besides me think that Steve Benjamin will be a one term mayor?
Who’s going to run against him and beat him? Moe Baddourah? I don’t think he can beat Mayor Steve. They’ll pull some hijinx like last time when “NO N*GGER MAYORS” got mysteriously spray-painted on a downtown wall, infuriating Benjamin’s voting base and ensuring heavy turnout. Or they’ll start running the “Party Bus” again and give out free food and beverages like last time.
To be honest, the Palmetto Compress Affair is the worst thing that the Mayor’s done since his election, and as Mark Stewart and others here have pointed out, it’s a sweet inside deal pure and simple.
Paging Juan Caruso….
No, they didn’t.
For one thing, the purchase price is less than the previous arms length contract price…..
Kathryn,
The purchase is still wrong. And over-priced. This is about inside baseball, plain and simple.
If it were about the building, we would be talking about how the structure will never be able to economically meet current building codes. We would be talking about priorities for historic preservation across the city. We would be talking about at-grade rail crossings and limited vehicular access. We would be talking about why this building is worth saving. We would be talking about strategic master planning to chart a course forward for Columbia into the future.
But we aren’t. Because the historic preservationists got played on this one. This is simply about bailing out a powerful group of owner’s who are otherwise strung out on the vine. This is about the the absolute corruption of the political process. Nothing more.
” This is simply about bailing out a powerful group of owner’s who are otherwise strung out on the vine. ”
Look at the players, this is exactly why and the only reason Columbia purchased this property. It’s an overpriced lot next to the railroad tracks with limited access. You have railroad tracks to the East, an overpass to the South, no road access from the West and a cut-through road to the North. The reason it never sold prior is because anyone with any sense realizes that this lot would never be used for anything other than a storage facility. On top of that you have a huge warehouse with sloping floors that can not be retrofitted for any other use. The cost to retrofit would likely be double what it’d cost to tear down and build new and to code. It’ll be interesting to see what Columbia decides to do with this property that the previous owners couldn’t.
Pretty sure we (Columbia city taxpayers and ratepayers) got hosed in the most recent city council meeting. We have NO business owning that warehouse, given the other fiscal and management issues the city is dealing with…
That is vulgar.
You’re right. I went back and edited it…
It may have been vulgar, but it was the correct description of what just happened to Columbia taxpayers.
Brad how did you edit it… change “screwed”, “f&#ked”, to “hosed”? Oh how I long for the day when we can talk like men around here and not like some ladies aid meeting.
SDII – I made an allusion to the Columbia taxpayer being de-trousered and subjected to a brutal sexual assault. Do you remember what happens to Elizabeth Shue’s character in the movie “Leaving Las Vegas”?
Oh… I just looked it up and threw in what you described and am guessing it’s an ankle grabbing moment and not that other thing. But the residents of Columbia and Richland County should be used to this by now, I’d think they’re sadistic enough to enjoy it since they don’t appear to do anything to stop it from happening.
So what was the property appraised at?
If a piece of property is worth $1, and I offer and back out of an offer of $10 and you come in a pick up the property for $5, your offer is more than the previous arm length contract price, but still more than the value of the property.
Silence is right, why on earth is the city buying an old warehouse? Hopefully they’re not using hospitality money for that boondogle.
@bud
Hate to break it to you, bud, but they are using bonds financed by hospitality money, I believe. That tax should go away as soon as possible. All it is is a slush fund to reward politically connected people.
From The State:
Benjamin discussed the plans after a divided City Council gave the first of two votes for borrowing up to $7 million – backed by meal taxes – to save the former cotton warehouse that has become a flashpoint between the business and preservationist communities.
Read more here: http://www.thestate.com/2013/03/27/2695867/its-decided-columbia-will-buy.html#storylink=misearch#storylink=cpy
Other people’s money is always the best money to spend…
That’s exactly how they’re funding this purchase.
Need another blood pressure pill? Word is John Lumpkin (owner) was seen skipping down Main Street after leaving City Hall.
bud – Not only are they using hospitality money for the Palmetto Compress Boondoggle, it’s actually worse than that. Since Columbia doesn’t actually HAVE the money yet, they are BORROWING the money. It’s a “two year tax anticipation bond” where the city is borrowing $7 million dollars, and pledging the future hospitality taxes to repay the bond. It’s basically the municipal equivalent of a payday loan, something Mayor Benjamin knows a whole lot about.
It is very forward thinking to pledge future hospitality tax revenues. Noy only are you able to spend what you don’t have; but you also get to ensure that the tax itself cannot be eliminated.
I guess this looks good vs looting the water and sewer funds again.
The property is on the National Register and meets EVERY criterion o. The list, not just one. Richard Burts is passionate about it, and he is completely convinced it can be adaptively reused. Tom Savory, a prominent architect, is, too. He points out that no one can say it doesn’t meet building codes until a use is identified. At least six qualified developers are interested.
Fair market value depends on what parameters you input. The contract was a legitimate arms length contract, and the Edwards Company put a lot into drawing up (pitiful) plans and trying to get them approved. They hired Robert Fuller, who doesn’t work cheap. There is no evidence it was not a legitimate contract. The fact that Edwards was willing to pay more than the city paid is plenty of evidence.
There is no plan for the city to continue to own it, other than perhaps a portion for a much-needed museum of Columbia’s history.
One need only to look at the interior photos of the beams and columns to see that the building will not meet any building codes related to adaptive reuse of the structure.
No plan for the city to continue to own it. Of course that’s true; this is a bonehead deal all the way around. Only the sellers win.
My concern remains that the city – and the proponants of this “deal” are going to flub it up and therefore not be in any position to advocate for saving the good Bull Street properties.
I felt like this Compress Warehouse deal was a bone being thrown to the preservationists, since Columbia is going to give the Bull St. developer whatever he wants.
Kathryn is Columbia’s head cheerleader. No matter what they screw up, she’s there talking them up.
Since I take the time, lots of it, to see what actually goes on, and participate in it, rather than shoot fom the hip with the same old cynicism, sure!
So you participated in the purchase of the property?
There’s a nice article in USA Today, hardly a liberal publication, that summarizes the staggering increase in CEO pay in 2012. Some of the increases are inexplicable and can’t possibly be the result of any “brilliance” in managing the company. When are stockholders going to revolt against this madness? Perhaps the worst offender is the ultra stupid Meg Whitman of HP who ran for California governor a few years back with an ad extoling the virtues of a time gone by. Problem was the year she picked as the golden age of California was also the year her opponent, Jerry Brown, was the governor! So much for the virtues of capitalism. Here’s an excerpt:
Meg Whitman, CEO of Hewlett-Packard, saw her pay package hit nearly $15.4 million in 2012 as investors suffered a 46% decline in total return during the year. Meanwhile, in mid-2012, the company announced plans to lay off 27,000 workers, or 8% of its workforce. In its regulatory filing, HP justified the payout, saying, “The independent members of the Board determined that Ms. Whitman had exceeded her objectives.”
Again, if the CEO increases shareholder value above and beyond the changes in stock price of the overall market, I’m fine with paying them a lot. I do think that shareholders (owners) should have more say on pay, though.
Bigger issue with paying the new city manager way too much.
” When are stockholders going to revolt against this madness?”
bud, you seem like a leader, dump your HP stock, grab some poster board and a marker, and march in front of the State House this afternoon screaming about the injustice.
@bud
HP stock has risen from 13.68 on December 28 to a current 23.55, an increase of around 80% in value in 3 months, raising the market capitalization of HP by $20 billion dollars in the process. Whitman’s salary is a pittance compared to that $20 billion. You may not realize it but companies like HP have employee stock plans that allow employees to buy into the company and reap the benefits as well. (Disclosure: HP owns a pension fund from a company that I worked for from 1978-1995 (DEC) so I am VERY interested in seeing it do well).
Sometimes you have to cut deadwood to grow the company. The job of the CEO is to make HQ profitable. It’s a tough business and requires tough decisions. I’m fairly certain that HP’s board and its investors are quite happy with Whitman’s performance this year. If she doesn’t keep it up, she will be shown the door or be allowed to “pursue other interests”.
Doug, you’re cherry picking statistics. Fact is HP stock declined over the course of 2012 which is the relevant time frame for this discussion.
Besides the point that free enterprise zealots try to make is that if companies are free to operate as they see fit they will create gazillions of good paying jobs. But here we have an example of a company that failed to either create jobs or benefit it’s stockholders for a given year yet it’s CEO rakes in a huge salary increase. And the wealth gap grows wider and wider with only a tiny cadre of well-connected and not particularly talented people reaping the benefits. It’s time for higher taxes on the rich, a greater roll for government in the employment arena, and stronger labor unions. Only then will our country return to the prosperity FOR ALL that we saw in the 50s-70s. If we continue on the current failed path of plutocracy run amock we will continue our downward slide.
It’s not a company’s job to create jobs. PERIOD. It’s only obligation is to make money for the owners. AGAIN, PERIOD. It should employ exactly as many people as it needs to employ to maximize profits and therefore shareholder returns over the long term. Everything else is not important.
@bud – Just to make your Friday, the CEO of ConocoPhillips is leaving with an announced retirement package worth $260,000,000. He did little more than head up the company as profits went into the billions for the past few years and oil production is at a company all time high. Rumor is he’s going to team up with Ted Turner and buy Wyoming.
@Bud
I am not cherry picking statistics. I took the lowest point at the end of 2012 to the current date. The decision to cut jobs last year probably had an impact on the current performance of the stock.
Unlike government work, jobs in the private sector are not there for life. Jobs go away, business strategies change, poor performers are let go. I know this is a foreign concept to a government employee but that’s the way the real world works.
The wealth gap is growing because we have a growing percentage of unskilled people whose jobs can be done by people in other countries for far less money. No skills = no opportunity for income increases.
High school dropouts in the U.S. get what they choose out of life.
“The wealth gap is growing because we have a growing percentage of unskilled people whose jobs can be done by people in other countries for far less money. No skills = no opportunity for income increases.
High school dropouts in the U.S. get what they choose out of life.”…Doug
I couldn’t agree more. When I was in high school, dropouts were not unusual because during that time period, technology was not the guiding or dictating force behind the economy. One could work at a textile mill with little or no education and made a decent living for his or her family. What is considered “stoop labor” today was commonplace and not looked down upon as menial or demeaning. Physical labor was the norm, not the exception but somehow, if some of our more socially liberal members of society see someone performing manual labor, they think the laborer is being mistreated. Part of my essential education was to have “hands on” experience so I could develop a better sense of what the end product should actually be, not a concept.
However, as technology became more and more integral to the business world, if you were not able to keep up, you were left behind and many of the jobs that were once done by humans were replaced by technology and rapid advances in data processing or IT. Today, a small laptop computer can do more than what a full blown IBM 370 could do and still have “room left over” for games.
If you choose to dropout, then the life ahead will most likely be unfulfilled and you will become dependent upon a government more than willing to provide you with everything you need to survive – as long as you vote for the ones who are responsible for the legislation that provides the feedbag and feed that goes with it.
This is not a conservative or liberal issue but an issue of personal responsiblity. Choices have consequences and if you choose to decline the opportunity to receive the benefits of an education, then you have no room to “bitch” if you can’t fulfill the new job skill requirements.
Research shows that we do not have the capacity to fully appreciate the consequences of our actions until we are about 25. Our brains just aren’t fully matured until then. It is harsh to stain people for life based on decisions they could not make wisely at the time.
I must be an advanced thinker then, because my dad had me helping/working at jobs by the time I was 12 years old. And I turned out just fine, wasn’t voted “Most Likely to Succeed” in my graduating class, but the last two reunions have proven that there were a lot of losers in my class who peaked around the age of 18 years old on the income and career scale.
Some of the most successful people I’ve met are high school or college drop outs. One of the reason why I believe welfare should be limited to two years is that is the time it takes to learn a new trade at a community college if life runs you into a roadblock.
25 year olds today are barely moved out of their childhood bedrooms… and can’t even imagine having to work for 40 hours per week. If you’re 25, unemployed and living at home… you’re nothing but a loser and slacker.
Kathryn, since our brains can’t fully appreciate the consequences of our actions until we are 25, should we:
A) Treat 18-25 year olds as minors in our criminal justice system?
B) Restrict the ability of under-25 year olds to drive?
C) Change the voting age to 25?
D) Extend high school to 25 and not allow people to drop out at 16?
Doug, Silence, et al,
First of all, go find a stop sign or a concrete wall at least 6 feet thick, 25 feet long and at least 10 feet tall. First, argue with the stop sign for several hours and decide if you made any headway. Then, go to the concrete wall and bang your head against it for a couple of hours, non-stop. After completing both tasks it will be evident that you wasted your breath with the stop sign and the only thing you have after pounding your head against the concrete wall is a massive headache and a bloody forehead.
There you have it – the equilivant of trying to change bud’s mind or argue with him. Total waste of time.
“The wealth gap is growing because we have a growing percentage of unskilled people whose jobs can be done by people in other countries for far less money. ”
-Bart
Here’s a point where we may be able to reach some level of agreement. Although I don’t believe this to be the most significant reason why the wealth gap has grown so sharply over the past 35 years, afterall productivity has increased since then, it certainly is a widespread problem in our society. But I’m pretty sure the solutions I would suggest as a liberal will be vastly different from those of libertarians like Doug. I will only say this, very conservative states like South Carolina have lower skill levels than more liberal states and much worse than in the very liberal nations of Europe and Japan. Given that it seems to me we should be looking for liberal solutions rather than conservative ones.
“Given that it seems to me we should be looking for liberal solutions rather than conservative ones.”
And what would that be? The Robin Hood solution, rob the rich/hard working and give to the poor/lazy?
How about if we simplify it even further… “you don’t work, you don’t eat”.
bud – A lot of the productivity gains aren’t real. Basically, if Intel produces a computer chip that is 10x faster, it shows up as a 10x increase in productivity. Now, if 100% of the computers produced were using 100% of their CPU cycles for productive uses, that would be a productivity increase, but if the faster CPU just let’s you browse the web or use a spreadsheet slightly faster, it’s not a 10X productivity gain.
I would say that onereason for the increasing wealth disparity in the US is the rise of the consumer culture. Having it all and having it now (on credit, frequently) has contributed to a lower savings and investment rate among Americans. People’s houses shouldn’t be their largest investment. Their largest investment should be their retirement savings, and their houses should be a place to live. It’s all based on very short term thinking and decision making, and a mentality that we should all have instant gratification.
Of course this isn’ the ONLY factor, but I’d say it’s the largest one. I know we’ll disagree on some of this, bud, but next time you see someone that you’d consider “less wealthy” try to envision how it’s possible that they contributed to their own situation.
Silence, bud isn’t going to be satisfied until those who work 80 hours a week give half of their salary to those who work 0 hours per week. That way society works an average of 40 hours per week and everyone should be expected to be happy. To which I say, if I’m working 80 hours per week those who work 0 hours per week better smile and wave as I drive past them in my new car as they sit on their front porch.
Bud will like this: In 1976 oppressive capitalistic exploiter and beloved children’s author Astrid Lindgren, best known for the “Pippi Longstocking” books, was subject to a 102% marginal tax rate in Sweden.
http://en.wikipedia.org/wiki/Pomperipossa_in_Monismania
What if we’ve hit “Peak Prosperity”?
http://economistsview.typepad.com/economistsview/2008/05/peak-prosperity.html