Elizabeth Warren Rebuts the GOP’s “Class Warfare” Accusation

Elizabeth Warren reminds us of the social contract we are born into in the United States.


Click here to find out more about Elizabeth Warren.

Comments

15 Responses to “Elizabeth Warren Rebuts the GOP’s “Class Warfare” Accusation”
  1. Todd Juvinall says:

    This women is an extremist and she has no sense of history or even how the real world and capitalism work. Scott Brown will defeat her even though her state is heavily democrat. They are even scared of her socialist ideology.

  2. depelton says:

    Hey Todd, I’m having trouble keeping up! 🙂

    You’re welcome to make the case here that Elizabeth Warren is an extremist, and a socialist for that matter, but all you have done so far is assert it, not really demonstrate it in any way.

    She has spent her entire professional life defending the working and middle class. Her academic specialty has to do with bankruptcy, and I believe she has shown the strong correlation between bankruptcy and the high cost of medical crises (our broken health care system).

    Her relentless defense of working people is what has made her such a popular hero, and she is certainly one of my heroes.

    As far as I know, her main critics and enemies have been the financial perps who want to keep on ripping off us working people.

    Scott Brown may beat her, but I think it’s unlikely. A mere week after she announced, she is already pulling ahead of him in polling.

    In fact, your comment has inspired me to send her some money today!

    It just goes to show you … you never know what good may flow from even the most casual comment.

    Thanks!

    🙂

    Don.

  3. Todd Juvinall says:

    No problem Your world view must be simpatico with her and you can do whatever you want with your money. Apparently she wanted to determine what you could do with your money and scared the heck out of the Senate democrats enough to not confirm her. If you listen to the video rant of hers and still think she is not a socialist extremist. Wow!

  4. Don Pelton says:

    Thanks, Todd.

    Yes, I did listen to her speech (it’s going viral on the Internet because so many people love it).

    And I do agree with you that she explains how important elements of our system depend on services you might call “socialistic.” She explains how successful businesses depend on services provided by the rest of us … roads, highways, courts, police services, post office, etc, etc.

    In that sense, the entire capitalist system everywhere depends on that kind of socialism.

    If that’s what you mean by socialism, then I agree with you, and I say the more socialism the better.

    Generally, though, our system can more properly be seen as socialism for the rich and capitalism for the poor.

    As far as her confirmation is concerned, Geithner made a deal with the big bankers not to conffirm her.

    Yes, she scares the crap out of greedy Republicans and spineless Democrats alike.

    Her most salient quality, the quality that absolutely terrifies them all is … her competence.

  5. depelton says:

    See “Elizabeth Warren’s conservatism

    Excerpts”

    “Elizabeth Warren’s nascent campaign to win the Democratic nomination for the US Senate in Massachusetts has already launched its first Internet phenomenon. In this oft quoted video, Warren makes the point that “nobody in this country has gotten rich on their own.” It has been praised as a succinct statement of liberalism and attacked as “Marxism, American-style.” Both of these criticisms miss the point. Warren’s statement is not liberal, let alone Marxist. In fact, it is a fundamentally conservative statement of belief in a thing called society.”

    ” … her conception of society is not one in which the state plays an active or leveling role redistributing income; after all if “you built a factory,” you are still entitled to “a big hunk” of its profits, in Warren’s folksy words. The revenues should not be redistributed to promote equality in income — it assumes that because its your factory and your idea, you have a right to profit from it. A commitment to free market economics is assumed unquestionably.”

    ” … Although some on the right attack Warren as some sort of leftist, her agenda in creating the Consumer Finance Protection Agency and advocating for bankruptcy reform is simply to remedy the flaws in which free markets have gone off the tracks. It is not a statist philosophy but one that encourages individual home ownership and financial stability. It reinforces the traditional conservative ideas of building a society in which we all mutually are owed, and owe, obligations. The real controversy should be that the political discourse has shifted so much of late that such a deeply conservative and traditional idea could be considered remarkable at all.”

  6. Todd Juvinall says:

    She, and apparently you, think the business is existing in a vacumn when it omes to taxes. We all have agreed that roads and police and other services are a part of our joint responsibity. Even the Polish Knights did when Genghis Khan’s sons were coming to destroy Europe. Anyway, socialists come and take the fire in the belly out of the makers and redistribute to the takers. The business pays taxes (actually as collectors for government), employs people and provides goods nd services for the community and beyond. Only someone who never worked for a business or as a entrepreneur would make the ridiculous statements she made. One only needs to see what your socialism hs done to Greece for goodness sakes.

  7. Paul says:

    With all due respect, Todd, this is utter hogwash. Nobody’s talking about taking corporate profits and handing out $100 bills to bums on the street. The point is that demand comprises two-thirds of the economy and demand has stalled. When income inequality is less pronounced, the people who we all count on to buy those goods and services actually have money to spend. The whole economy therefore functions better. That goes for the (alleged) “job creators” and for the folks who actually do the work. If you’ve run a business, then you should already know this.

  8. Todd Juvinall says:

    You have it backwards. If there was no job creator there would be no job. How do you think a job is created for goodness sakes. She is telling the dumdums in the meeting that business is in a vacuum and that only the “others” pay for roads and the rest of the stuff yaps about. She is just dumb about the real world and how it works. Of course if she wins she can join the others Harry Reid types and double down on screwing up the place.

  9. depelton says:

    Todd, you said:

    “If there was no job creator there would be no job.”

    That’s incorrect.

    Paul’s right. Here’s why:

    Without demand, businesses don’t exist and jobs are not created.

    Proof: Currently corporations have trillions of surplus dollars in their coffers but they are not using them to expand capacity and create new jobs. This also proves that new tax cuts would achieve nothing.

    Why are corporations not using their surplus dollars to create jobs?

    Obviously because — as Paul correctly points out — demand is too weak.

    Why is demand too weak?

    Because starting in the late 1970s — due to tax policies favoring the rich (aka “Reaganomics”) — increasing worker productivity was no longer matched by increasing real (adjusted for inflation) wages. Political attacks on unions, weakening them, also contributed to rising income inequality.

    This historically unique de-linking of wages from productivity is the primary cause of the massive increase in income inequality since then. In the 1970s the average CEO wage was about 40 times the average worker wage. Today it’s over 300 to 1. Obscene.

    There is growing understanding among economists that income inequality is related to the boom and bust cycles that continue to plague our economic system. Not coincidentally the last time that income inequality was this extreme in the US was in 1929, on the verge of the Great Depression.

    Here’s how it works. Tax policies favoring the rich result in massive shifts of wealth away from the working (spending) class to the affluent (hoarding) class, with a corresponding collapse in demand (because the working class no longer has enough wealth to create significant demand, and the hoarding class hoards it rather than spends it).

    The weakening of working class demand since the 1970s was compensated for by Federal Reserve policies promoting massive borrowing (against stock equities, massively against home equities, etc) and that’s why we saw boom and bust cycles in those markets.

    But now, all possible artificial demand bubbles in most markets have burst.

    The cure for what ails our economy in the broadest sense is to undo the current inequitable distribution of wealth, make the tax system more progressive by raising the top marginal tax rate on the affluent (dump the Bush tax cuts, etc), which would in turn restore demand, leading to more job creation.

    Interestingly, recent studies prove that there is a greater level of social ills (increased physical and mental illness, increased crime of all sorts, etc) in societies with greater levels of income inequality.

    Consequently it follows logically and incontrovertibly that what best solves our economic ills also best solves our social ills.

    Economic and social justice are mutually reinforcing.

    FDR arrived at that conclusion and implemented policies that were phenomenally successful for several decades after WWII until they started being dismantled by the misbegotten and now fully discredited policies known as “Reaganomics.”

    Fortunately the way back to that healthy state (in which the rising tide truly lifts all boats) is well understood, except by the bought-off politicians in both parties now holding sway in D.C.

    Income inequality is the chief scourge of our economic and political system today. Until that’s remedied, we’ll continue to be screwed.

  10. Todd Juvinall says:

    Sorry but your premise is a false one. Edison for instance created a demand for electricity by creating the lightbulb. He and his staff then put in somewhere back east, the first electrical lines and hookups. Now we have millions of people working in electricity related businesses. Ford had an idea about a horseless carriage and soon people were demanding them and he hired thousands of people to build them. These are simple examples but it could be transferred to any product. Therefore, you are simply incorrect. Also, a business is not created to create jobs and supply health insurance. It is created to make and sell a product and make a profit. They are not created to be a social program.

  11. depelton says:

    Sorry, but your answer is over-simple and doesn’t explain the trillions of dollars in surplus that corporations are sitting on.

    If your answer was sufficient, then those trillions would be getting spent, and demand would be getting “created by products,” an absurdity.

    RE: Edison, the demand already existed for lighting, which was satisfied prior to the lightbulb by oil lamps, lanterns, etc. Edison satisfied that pre-existing demand with a better solution.

    The demand already existed for communicaton and power and that demand was met prior to the invention of electrical lines by mail, telegraph, steam engines, etc. Power lines provided a better solution for meeting that pre-existing demand.

    Prior to the invention of the horseless carriage, the demand already existed for good personal means of transportation and was met by horses, horse-drawn carriages, etc. The horseless carriage provided a better solution to that pre-existing demand.

    Therefore you are simply incorrect in asserting that the product creates the demand. (As former Fed Chief and devotee of Ayn Rand Alan Greenspan said about the 30 years of Reaganomics which led to the meltdown of 2008, “there’s a flaw in the model”).

    Rather, demand makes the product possible.

    In economic terms, demand exists if wealth exists and people are willing to spend that wealth on their human needs and wants.

    The flow of causation looks like this:

    [human needs/wants] + [wealth] -> [economic demand] -> [businesses/products].

    Not like this:

    [businesses/mythical job creators’ products] -> [demand] (as you would have us believe).

    You’re correct in saying that “a business is not created to create jobs and and supply health insurance … it’s created to make and sell a product and make a profit.” And it’s only able to do that if a prior demand exists for its product.

    The insufficiency of demand that plagues our economic system right now exists because of the massive shift of wealth to the hoarders.

    Insufficient wealth exists in the hands of the spenders, and too much resides in the hands of the hoarders.

    Until the jobs problem is fixed (ideally by a massive federal jobs program) the whole economy will be in the doldrums.

    Enlightened businessmen understand this.

  12. Paul says:

    Ah, so companies will always automatically produce things whether or not they think people will buy them and the only reason people have a need for something is when somebody has already produced it.

    Please note that neither depelton nor I ever suggested the economy is powered by grade-school math. If demand is two-thirds of the economy, then the other third must be … ? (fill in the blank).

    In other words, it’s a giant mistake to generalize from a couple examples of things that have obvious market potential and conclude that supply-side economics really works all the time.

    Companies do not produce products that they don’t think people will buy. People do not always buy things companies produce. Over all, right now, it appears that demand drives a larger portion of the economy than supply. If you need demand and people aren’t buying, that’s where government-driven demand comes in to save the economy. As has been pointed out numerous times above, economists are mostly in agreement on that.

    By the way, the tech boom under Clinton’s administration was a real supply-side boom. Don’t say I said it couldn’t happen.

  13. Paul says:

    My last comment was in response to your comment, Todd.

  14. Steve Frisch says:

    Elizabeth Warren’s point that no one in a society gets rich on their own is most aptly proven by the actions of some of America’s first industrial revolution capitalists and richest people. Andrew Carnegie, Henry Ford, John D. Rockefelller, and dozens of other products of the Gilded Age put the vast majority of their wealth into philanthropic organizations with a mission to build a more educated, just, peaceful, and civil society. Why did they do that? If you read their own words, it is because they felt the owed society a debt of gratitude for the opportunity and success they enjoyed.

    This practice continues today when billionaires pledge to donate at least 50% of their net worth to charitable causes:

    http://uk.reuters.com/article/2010/08/04/wealth-philanthropy-billionaires-list-idUKN0416747520100804

    Finally, I agree that one primary motivation for people going into business is profit–nothing wrong with that–but another motivation, and the one that seems to set the great companies apart from the run of the mill, is mission. Consider the work of business analyst Jim Collins: he finds that the distinguishing characteristic of highly successful business leaders is to make profit while achieving a mission. That mission could be improving people’s lives, pioneering new technology, proving a concept, inspiring change, etc. The business leaders he has studied say quite clearly, making money is secondary to achieving excellence, and achieving excellence leads to making more money.

  15. Paul says:

    “As mass production has to be accompanied by mass consumption, mass consumption, in turn, implies a distribution of wealth … to provide men with buying power. … Instead of achieving that kind of distribution, a giant suction pump had by 1929-1930 drawn into a few hands an increasing portion of currently produced wealth. In consequence, as in a poker game where the chips were concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing. When the credit ran out, the game stopped.”
    — Marriner Eccles, Chairman of the Federal Reserve, 1934-1948

    (see: http://motherjones.com/mojo/2011/10/study-income-inequality-kills-economic-growth and http://en.wikipedia.org/wiki/Marriner_Stoddard_Eccles)

    So apparently Eccles not only helped construct the New Deal, but he could also predict the future.

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