Stop the Coronavirus Corporate Coup(mattstoller.substack.com)
mattstoller.substack.com
Stop the Coronavirus Corporate Coup
https://mattstoller.substack.com/p/stop-the-coronavirus-corporate-coup
26 comments
[deleted]
I'm fine with a bailout of some companies as long as the shareholders bear the burden and the taxpayers have a plausible scenario for upside.
Want $65B Boeing? Okay -- we'll give that you that as a capital injection against your cap table. Preferred stock with preferences and at a discount. Oh, your market capitalization is only $53B right now? I guess that makes the US treasury your largest shareholder.
Existing shareholders get what's coming to them: Massive dilution. The government gains an enviable equity position that they can eventually exit at hopefully a large profit.
Over the next decade, the government responsibly liquidates these positions. Those liquidation events can be spent servicing our ballooning national debt and underfunded entitlements.
This is the exact same deal a startup would get if they were in a similar position and went back to investors for cash from an unfavorable position.
Want $65B Boeing? Okay -- we'll give that you that as a capital injection against your cap table. Preferred stock with preferences and at a discount. Oh, your market capitalization is only $53B right now? I guess that makes the US treasury your largest shareholder.
Existing shareholders get what's coming to them: Massive dilution. The government gains an enviable equity position that they can eventually exit at hopefully a large profit.
Over the next decade, the government responsibly liquidates these positions. Those liquidation events can be spent servicing our ballooning national debt and underfunded entitlements.
This is the exact same deal a startup would get if they were in a similar position and went back to investors for cash from an unfavorable position.
I mean I appreciate the attempt, but politics are in a vastly different state compared to 2008. Republicans are essentially the populist far right party now, shown by their willingness to hold the public hostage so that they can get concessions in a time of crisis. Meanwhile, the liberals are in favor of big business above all else and will gladly vote to bail out companies while their attempts to help working class families is an utter joke.
I don't see an easy way out of this crisis becaus of our president, our government and our representatives failing us at every step of the way. Thankfully local governments are stepping in, but this is one of those times where you need a strong governmental response in order to ramp up production, provide guidance and prevent cities from getting destroyed due to the economic ramifications.
I don't see an easy way out of this crisis becaus of our president, our government and our representatives failing us at every step of the way. Thankfully local governments are stepping in, but this is one of those times where you need a strong governmental response in order to ramp up production, provide guidance and prevent cities from getting destroyed due to the economic ramifications.
One party made a $1.5 corporate tax cut their singular issue of the current President's (hint!) first term. The other party's most significant recent accomplishment was a health care reform that reduced the number of uninsured by a few (ten-ish?) million.
There may (before 2016 have been) reasons to prefer either party. But to somehow observe the current incarnations of parties and conclude that the latter puts "big business above all else" is intellectually dishonest.
There may (before 2016 have been) reasons to prefer either party. But to somehow observe the current incarnations of parties and conclude that the latter puts "big business above all else" is intellectually dishonest.
The current incarnation of the Democratic Party resembles republicans of roughly 30 years ago, while the Republican Party has spun further right.
Yes, Republicans will gladly give huge corporate tax cuts. They're in the pockets of big businesses too, make no mistake. Dems may act like they give a shit, but considering they take in just as much lobbying money from billionaires and corporations, they really don't. That's why the party can hardly agree on reforming our medical system, something which is considered profoundly popular among their voting base. That's why they're willing to give concession after concession to the Republican party until they get a completely neutered bill with everything the Republicans want.
Yes, Republicans will gladly give huge corporate tax cuts. They're in the pockets of big businesses too, make no mistake. Dems may act like they give a shit, but considering they take in just as much lobbying money from billionaires and corporations, they really don't. That's why the party can hardly agree on reforming our medical system, something which is considered profoundly popular among their voting base. That's why they're willing to give concession after concession to the Republican party until they get a completely neutered bill with everything the Republicans want.
> Meanwhile, the liberals are in favor of big business above all else and will gladly vote to bail out companies while their attempts to help working class families is an utter joke.
Your definition of liberal seems very different than the typical definition.
Your definition of liberal seems very different than the typical definition.
Typical American definition maybe, but the word liberal is synonymous for big business in the rest of the world. Neoliberals are not left-wing, and the Democratic party is not left wing.
Not really that is the reality right now. Liberals mean neo-liberals. He is spot on. May be you meant progressives.
The UK proposal is a surprisingly effective way to handle this. By paying paying workers a percentage of their wage directly, you are protecting both the workers, and the companies that can now cut their costs by moving a large portion of their workforce to “unpaid” leave guilt free. This method is essentially designed to minimize damage and allow for a fast rebound once the restrictions are removed.
This seems much more beneficial for at least small biz owners. They don’t want to lay off staff because they probably can’t get all the same people back after this is over, so have to train up all new employees at once. But currently for employees to get unemployment, they must be fired first
In some countries this approach is part of existing work laws.
https://en.wikipedia.org/wiki/Short-time_working
https://en.wikipedia.org/wiki/Short-time_working
Yep, in the Netherlands government covers 90% of the salary
> if people on the populist left and people on the populist right work together.
Yes.
Yes.
I am very inexperienced and uneducated in matters like these. Is what this post is describing a real possibility?
There have been may instances of politicians using a crisis or event to usher in sociatal transformation. Two that come to mind are Kristallnacht and the assassination of the Archduke Franz Ferdinand. There is no doubt a contingent of government (on both sides) that would like to use a reset as a catalyst for a fundamental change to the social contract of the US. The question is, are they large enough and organized enough to pull it off. I would certainly expect those not enamored with the constitution to see how far they can bend it, in times like these, at the very least.
https://en.wikipedia.org/wiki/Kristallnacht
https://en.wikipedia.org/wiki/Archduke_Franz_Ferdinand_of_Au...
https://en.wikipedia.org/wiki/Kristallnacht
https://en.wikipedia.org/wiki/Archduke_Franz_Ferdinand_of_Au...
Kristallnacht is an odd example, considering it was (openly) organised by the government.
The canonical example from that time would be the Reichstag Fire[0].
But in an effort to avoid Godwin's wrath, it might be advisable to find examples a bit lower on <whatever scale such things are measured on> (Millihitler?). 9/11 and all the anti-terror legislation and war powers would be a more recent example.
[0[: https://en.wikipedia.org/wiki/Reichstag_fire
The canonical example from that time would be the Reichstag Fire[0].
But in an effort to avoid Godwin's wrath, it might be advisable to find examples a bit lower on <whatever scale such things are measured on> (Millihitler?). 9/11 and all the anti-terror legislation and war powers would be a more recent example.
[0[: https://en.wikipedia.org/wiki/Reichstag_fire
Sorry my intent was to show that some of these events are even orchestrated by the government as was the case with Kristallnacht and while most assume the Reichstag Fire was too it is not as clear cut. I also wanted to show that not all of them are as with the case of the ArchDuke. I could have been more clear in that intent. I also intentionally steered clear of US ones as I did not want to invoke consprinoia discussions.
But the point being that a contingency in government live by the adage never let a good crisis go to waste.
But the point being that a contingency in government live by the adage never let a good crisis go to waste.
As usual it is socialism for the rich and capitalism for the poor.
I do share the author's scepticism. But it's a bit much to describe this as something that "really looks less like a relief package and more a corporate coup" when you admittedly have absolutely no idea of what it actually is.
One could argue the same case just as well without resorting to pre-emptive hyperbole. This isn't a new problem for public advocacy groups, and they tend to try to find a balance where you get people to sign up for your newsletter or prepare to show up for a protest, but with the understanding that it may not happen or that your actual message will be decided at short notice.
Honesty in such matters isn't just moral principle, but also serves your cause. Because outrage overload such as this will only get you written off as "cynics that would oppose everything". No politician will even consider to change their behaviour if you publicly admit that you are going to oppose them entirely independent of that behaviour.
If you don't appear willing to consider the actual facts, you have no power.
One could argue the same case just as well without resorting to pre-emptive hyperbole. This isn't a new problem for public advocacy groups, and they tend to try to find a balance where you get people to sign up for your newsletter or prepare to show up for a protest, but with the understanding that it may not happen or that your actual message will be decided at short notice.
Honesty in such matters isn't just moral principle, but also serves your cause. Because outrage overload such as this will only get you written off as "cynics that would oppose everything". No politician will even consider to change their behaviour if you publicly admit that you are going to oppose them entirely independent of that behaviour.
If you don't appear willing to consider the actual facts, you have no power.
Are you willing to stake your bets so, when the reason we're in this situation is in the first place is an inversion of the "ounce of prevention" principle?
I think, at this point, it would be prudent to articulate exactly what we do want, so that what gets handed to us on an up-or-down vote is not wholly removed from our desires. The answer is to presume the worst and advocate for the best.
I think, at this point, it would be prudent to articulate exactly what we do want, so that what gets handed to us on an up-or-down vote is not wholly removed from our desires. The answer is to presume the worst and advocate for the best.
I'm not entirely sure what my preference would be if the choice is between a bailout for both Boeing and the newly unemployed, or neither. Yes, I'd be angry. It would be an insult to my sense of justice. But in a choice between my sense of fairness and some kid's warm lunch, maybe the kid should get some food?
Which brings me to another criticism: This starts out as some appeal to bipartisan outrage. But really the core position is entirely identical to the Democrats' best-case scenario. The difference is just that the Democratic Party is (presumably) willing to make the sort of compromise I describe above.
Irregardless of these difference on the morality of such a trade-off, it appears just wrong, somehow, to treat the two parties with the same brush when the overlap with one of them is so large, and the entire problem is created by the other party's willingness to take hostage.
Which brings me to another criticism: This starts out as some appeal to bipartisan outrage. But really the core position is entirely identical to the Democrats' best-case scenario. The difference is just that the Democratic Party is (presumably) willing to make the sort of compromise I describe above.
Irregardless of these difference on the morality of such a trade-off, it appears just wrong, somehow, to treat the two parties with the same brush when the overlap with one of them is so large, and the entire problem is created by the other party's willingness to take hostage.
>I'm not entirely sure what my preference would be if the choice is between a bailout for both Boeing and the newly unemployed, or neither.
I think that's a false choice. We can take the latter without the former.
I think the point of the essay is what the rest of your comment speaks about. There's a clear distinction here between innocent parties and the groups who, frankly, fked up. All that's left is having the wherewithal to do what's right.
I think that's a false choice. We can take the latter without the former.
I think the point of the essay is what the rest of your comment speaks about. There's a clear distinction here between innocent parties and the groups who, frankly, fked up. All that's left is having the wherewithal to do what's right.
America is a huge fan of socialism, and by that we mean socialism for large corporations and the wealthy.
Hard to imagine we have anything close to a competitive free market if the minute a business gets into trouble it's just bail outs.
Hard to imagine we have anything close to a competitive free market if the minute a business gets into trouble it's just bail outs.
With a complete fiasco in charge and everyone stuck home, loaded up on supplies it’s kind of like... could just stop replying to those slack dings any time now.
Biden will drag it right back to emotionally efficient sweeping the growing inequality issue under the rug once everyone thinks it’s safe to stop looking again.
Biden will drag it right back to emotionally efficient sweeping the growing inequality issue under the rug once everyone thinks it’s safe to stop looking again.
Just my 2ct.