Net Neutrality

[speed dawg]

I disagree. A totally private system would be the opposite of a dictatorship. Dictatorships are when the guy in charge IS the government, and he has a monopoly on EVERYTHING.

I see as the circle completing itself. On the far side of right or left, it's the same thing.

But the reason a totally private system would never work is most people are too scared/lazy to be totally responsible for themselves. They very much need a government "safety net."

Agree, I'm one of them. It's a scary thought.

And very many people are very good at PROMISING them a safety net in value that EXCEEDS what they are expected to contribute.

But once the government safety net turns into hammock, it's over.

All societies collapse the same way.

The group people PRODUCING get smaller and smaller.

The group of people RECEIVING gets larger and larger.

Whatever your moral argument is (corporations are evil, poor people should be taken care of, money should be taken from rich people and given to poor people because it's "fair") the system is MATHEMATICALLY UNSUSTAINABLE.

Dudes on sosuave and elsewhere can argue and wring their hands until they lose their voice, but our system is beyond the point of no return.

The people RECEIVING are increasing.

The people PRODUCING are shrinking.

Clever reframes and one liners and witty attacks on the moral structure of your enemy won't allow goods to be poofed out of thin air.

We agree, thus the slow decline I alluded to earlier.

 

[Bible_Belt]

I disagree. A totally private system would be the opposite of a dictatorship. Dictatorships are when the guy in charge IS the government, and he has a monopoly on EVERYTHING.

Your capitalist overlords are your dictator. It's the exact same bullsh!t. When you eliminate government, the corporations run everything. They are purely motivated by profit, nothing else. What makes you so eager to be their slave? There's no freedom in spending your life toiling away so that billionaires get richer.

 

[Billtx49]

I sense a fear in you about the way things have already worked out very well for everyone involved, without much problem, in this country for centuries…

 

[taiyuu_otoko]

"Rape and pillage"

dems and libs are fine when their guys are raping and pillaging.

They only scream bloody murder when the other guys are doing it.

all else equal, I side with the rapers and pillagers that let me keep my guns, not the guys who want to take them away.

https://en.wikipedia.org/wiki/List_of_current_members_of_the_United_States_Congress_by_wealth

The puppets (whose strings are being pulled by the evil corporations) seem to have a fair share of dems and repubs.

And it's not like one party or the other gives a sh*t about the working man.

Just that one party pretends to (and enough people believe them).

It's all a con anyhow.

None of these internet arguments matter.

We're fvcked. Nobody's coming to rescue us. Every man for himself. I suppose arguing online about whose political party is the bestest may provide free entertainment and a sense of emotional relief, but when this fvcktrain crashes, everybody's dead.

 

[Billtx49]

This is a false and insidious argument used by those who hate the idea that some people are smarter or more productive than others.

Yep, socialism is great until you run out of other peoples money…

 

[Bible_Belt]

Creating wealth or value is what makes us all rich.

Trickle down is the biggest Republican lie ever sold to poor people. There is absolutely no real world evidence that such a thing occurs. It's the best fake news ever created.

Most rich people are not rich because they are smart. That is more fake news. Most rich people, like our Great Leader, are rich because their mommy and daddy were rich. They are the modern equivalent of royalty. We just threw another trillion on the ole national credit card so we could give the lords more money. As soon as 2018 hits, the Republicans will act surprised that we are broke, and immediately start robbing from the poor to make up for what they have given to the rich. Reverse Robin Hood is the Republican way. They use lies like trickle down and rich people being superior, which for some amazing reason unknown to me, works in tricking poor people to vote Republican.

 

[Billtx49]

Trickle down is the biggest Republican lie ever sold to poor people. There is absolutely no real world evidence that such a thing occurs. It's the best fake news ever created.

Most rich people are not rich because they are smart. That is more fake news. Most rich people, like our Great Leader, are rich because their mommy and daddy were rich. They are the modern equivalent of royalty. We just threw another trillion on the ole national credit card so we could give the lords more money. As soon as 2018 hits, the Republicans will act surprised that we are broke, and immediately start robbing from the poor to make up for what they have given to the rich. Reverse Robin Hood is the Republican way. They use lies like trickle down and rich people being superior, which for some amazing reason unknown to me, works in tricking poor people to vote Republican.

Illogical and fact devoid arguments will never win a debate before an online or real jury.
Just another socialist leaning Lib that refuses to accept Nov 2016 as past history…

 

[taiyuu_otoko]

Profit is another word for wealth, or value.

Profits are an essential part of a functioning economy as a they signal that a company is producing what people are willing to VOLUNTARILY pay for.

A company spends one million on raw materials. They turn those into products that sell collectively for 1.2 million.

That is a profit of .2 million, which is a signal FROM society are large TO the company that says, "We like what you make. We want what you make. We are WILLING to pay our money for what you make, at the price you are asking."

This is an ESSENTIAL signal that helps companies decide how (out of the many possible ways) to convert raw materials (or lower order wealth) into finished goods (higher order wealth).

Now, if a company spend that same mil and only got back .8 mill, that would be a LOSS (equally critical to a functioning economy).

It is a signal FROM society TO the company that says, "We like what you want, but we're not willing to pay what you're asking. Only a little bit less."

This "loss" signal is JUST as essential.

It's commonly thought, and argued, that with a smart enough government, they can DECIDE and CALCULATE exactly HOW to "best" not only distribute the wealth, but precisely WHAT higher order wealth to make from lower order wealth.

Every country that has tried this has FAILED MISERABLY and ended in lots of death and misery.

ESSENTIAL POINT

The ONLY WAY any corporation can grow large enough to FORCE PEOPLE to buy their goods at ARTIFICIALLY high prices is by enlisting the help of the government and it's always implied threat of violence against those who do not comply.

Without out the assistance of the governments, companies can only grow as large as people are willing to voluntarily buy their products.

Behind every HUGE CORPORATION that people wring their hands over, they are ONLY THAT BIG because they have politicians on a leash, or puppets on a string.

Unfortunately, people's cognitive dissonance makes many REFUSE to believe this.

Because getting a job is hard.

Switching jobs is hard.

Running a company (no matter how big or small) is extremely difficult, as you must always watch out for your competition, trends, continue to be innovative, etc.

People would MUCH RATHER believe the simple and binary idea that governments = good and big corporations = bad as those beliefs allow them to believe they CAN get more OUT of the system than they put in.

AND it gives them plenty of ready arguments to signal their own "moral authority"

(e.g. those that oppose my ideas MUST be white, redneck, republicans).

 

[Bible_Belt]

You know what else happens in socialist countries? They take care of their old people. My grandma just got stuck, by her profiteering hospital, in a nursing home that meets every bad expectation one would have about nursing homes. In poor people homes like this one, almost everyone is on Medicaid, and the State of Illinois refuses to pay their part of the Medicaid obligations. They tend to run 1-2 years behind, when they actually do pay. So there's basically no money for adequate staff, supplies, or equipment. The patients are all either severely mentally or physically incapable, sometimes both. The rooms are tiny, and the only tv is in the common area. There's not even enough furniture for them to sit on, and what is there, no one would take for free if you tried to give it away.

And grandma's not poor. She has private insurance and plenty of money. This is not a person who has ever been on any kind of welfare. So if you're thinking, well that won't happen to me because I work for a living and I'm not on welfare, guess again, mother fvckers! THAT is YOUR future. You're going to be sitting in a nursing home with a full diaper, getting neglected just like everyone else. These are the people we are robbing so that we can give tax breaks to billionaires, and you and I will become just like them eventually. Are you still going to continue with the "get the guvment out my life' song and dance then?

 

[synergy1]

Trickle down is the biggest Republican lie ever sold to poor people. There is absolutely no real world evidence that such a thing occurs. It's the best fake news ever created.

Most rich people are not rich because they are smart. That is more fake news. Most rich people, like our Great Leader, are rich because their mommy and daddy were rich. They are the modern equivalent of royalty. We just threw another trillion on the ole national credit card so we could give the lords more money. As soon as 2018 hits, the Republicans will act surprised that we are broke, and immediately start robbing from the poor to make up for what they have given to the rich. Reverse Robin Hood is the Republican way. They use lies like trickle down and rich people being superior, which for some amazing reason unknown to me, works in tricking poor people to vote Republican.

If you give the poor idiots someone to hate - and there are so many options these days - then you can distract them as you rape and pillage the government for your own financial gain.

I'll give politicians a lot of credit - they have successfully managed to follow one of the 33 Strategies of War:

-Declare war on your enemies:
Polarity (You cannot fight effectively unless you can identify them. Learn to smoke them out, then inwardly declare war. Your enemies can fill you with purpose and direction.)
​

Hilary Clinton, Radial Islam, terror, immigrants all fit this bill perfectly. Bannon openly admits that he is a big fan of war strategy and probably is as schooled on the subject as anyone out there. it was obvious last year. Its all a smoke screen. Most people would rather give in to the urge to hate someone else, and blame them for their problems so it was natural to manipulate them. it worked, and is still working.

Concerning Trickle down - I don't know how this lie keeps making it on the airways. We can pour over thousands of form 10-ks for profitable companies over the past decade and watch income/cash positions grow, while real wages remain stagnant. Business invests in new projects if they see growth in that area. Look what happened to said investment in the oil space after crude prices collapsed? It dried up for obvious reasons. A tax cut won't spark growth in strong macroeconomic headwinds and it won't abate growth with economic tailwinds (low interest rates anyone).

I used to lean more democratic, but have since changed and don't really align with either. On one hand, you have control which can hamstring perfectly honest/good businesses. Why should government subsidize things like electric cars for rich people with taxpayer dollars? Ethanol mandates using taxpayer dollars? On the other, we have instances where no regulation as in Enron in 2000s in California, and traders were buying/selling energy based on manipulating the market. It ended up costing people more money. Will this happen with net neutrality? There aren't a whole heck of a lot of Providers to chose from- will the ISPs structure internet packages so that the lowest payers only get advertisements, and the higher payers can get the useful parts? I don't know, but history of monopolies suggests that the shareholder , not the end user will receive priority.

I like the tenants of free market advocates, but we don't live in a free market. Laws are written to benefit only certain classes. What happens if John Doe is working a job to barely get by, and gets hit with a medical emergency that effectively bankrupts him. Can he discharge student debt? No. What about a corporation that is over leveraged, spent too much when times were good only to be hit hard when a secular change wipes out their bottom lines? They are afforded said protection. Its a messy process and creditors/shareholders lose a lot...but the option is on the table. Case studies can be found in the off short drilling space.

Proponents of the free market as it pertains to politicians, esp on the GOP side aught to add a caveat to their thought. And that is that its a free market for folks with the right means. Its not a free market for you and me. It hasn't been for some time.

 

[Bible_Belt]

Sorry to hear about your Grandmother Bible, but there are a few problems with your story.

1. Hospitals don't choose where to stick Grandma, family chooses. It sounds like your family chose to not care for her.

2. The money problem you listed, between Medicaid and the State of Illinois, are all Government, NOT privately owned. THAT IS WHAT SOCIALISM LOOKS LIKE!

3. Despite me pointimg out how the problems in your story are not profit related, you still have not presented a counter argument to how wealth is created by capitalism. Socialism still destroys wealth.

4. Your being poor is not because of rich people.

The hospital called my senile grandpa at home alone, knowing full well that he has dementia, so they could get permission from him. We got scammed, because they weren't making enough money off of her at the hospital, so they wanted her out.

I did some more research, and the state being behind is actually just a bullsh!t excuse that the rich assh0le owners use to justify their neglect.

Here's an article about the swell guy that owns the home my grandma got stuck in: http://www.bnd.com/news/local/article17743991.html

He's 35 years old and owns a dozen nursing homes, all of which are sh!tholes, but I'm sure quite profitable. Surely he must be a genius to have so much wealth at a young age? Nope, daddy gave him everything. Daddy is a corporate CEO bigwig. So you were 100% wrong. THIS IS WHAT CAPITALISM LOOKS LIKE. Hooray for profits! Profits can't ever be evil, right? I mean, these people are old, what good is their life if they can't play their small part in making some rich spoiled brat even richer?

The reality is that government regulation is the only thing keeping nursing home residents alive, and thanks to the current moron-rich political environment, we are cutting regulations and the funding to pay for any enforcement. That's what Trump really means when he talks about getting the "excessive" government off of the backs of the holy Job Creators like him - billionaires ought to be able to kill poor people to make more money for themselves. That's capitalism, and if you disagree, then you must be some kind of communist.

 

[Bible_Belt]

3. "Trickle down" economics DOES WORK, as evidenced by all the bonuses and investment plans announced right after the tax cuts. Hell, my Company just announced a new expansion as a result.

It was all corporate propaganda, aka "fake news." The money they announced that they were spending is a ridiculously small, token sum. People are easily fooled when you are telling them what they want to hear.

 

[synergy1]

"Trickle down" economics DOES WORK, as evidenced by all the bonuses and investment plans announced right after the tax cuts. Hell, my Company just announced a new expansion as a result.

That is exactly why these companies grabbed the headlines and put a fraction of their future free cash flow into them. They knew people would buy it. What about the dozens of companies who have organically grown their free cash flow for the past 10 years and not done this?

Edit: I suppose that additional retained earnings will grow towards growing capex in many cases, provided the market is there. Any macroeconomic headwinds and you can forget about growth. Retail? Why would they expand brick and mortar?

 

[synergy1]

lets examine the period between 2000 and 2006 in terms of monetary and fiscal policy, and what actually happened. Greenspan ended up cutting rates in 2001 in order to avert a possible recession. From 2003 to 2007 it appeared to have worked. But Its just as important to look at fiscal policy, specifically the role of the 2001 Bush tax cuts which redistributed income to the investing class ( rich). During that time period there was already an asset bubble forming via housing, and fixed income products derived from them. The investing class will invest in business when it makes sense, but its hardly the *only* thing they invest in. The pure size of the fixed income securities derived from housing shows exactly this - do you really believe that this money was helping the economy? No. If anything, it was falsly driving up asset prices and forcing a larger and larger base to take on more risk. Did wealth trickle down? Not really. Wages stagnated. The value of financial assets went up, as well as those of bubble assets ( housing). In 2008, the taxpayer ended up footing the bill for the overvaluation of these financial assets that the rich people piled into in large numbers.

Another good period to example were the aggressive tax cuts in the first half of the 1920s. An asset bubble started in 1925 , which was accompanied by a spending boom which all ended in 1929. We all know what happened after that - a 10 year deleveraging cycle. I think we can all safely say that there wasn't anything left to trickle down in 1929. Everyone was wiped out.

Companies don't need tax breaks for increased access to capital. They can access equity markets ( tesla), or debt markets. Companies have previously been enjoying growing top/bottom lines as a whole - but admittedly this is slowing down. But do NOT confuse a spending frenzy with a growing economy. The conglomerate boom of the 1960s might be an example of this where acquisitions were all the rage, despite not adding any real value.

So where are we now. We are going on a decade long period of ZIRP which has effectively given many organizations a cheap way to finance growth for very low cost. The Fed wants to tighten into a growing economy, so in the short term I see this in conjunction with a tax cut as a good thing for companies. However, an economy isn't really driven by big corporations, but rather by the consumption of the masses. It sounds like the gains from this tax bill will be negligible (1000 dollars per person will not jump start the economy, you need growing wages for that and we haven't had those in decades). Unless there are genuine opportunities to organically fund growth, none of this wealth will trickle down, but rather these companies will (1) chase yield, or (2) sit on cash just like apple and berkshire are.

Personally I see these tax cuts as a precursor to the next recession. What I have posted above is an extremely small cross section of my research on the subject, and I am fairly confident that we will see a major pullback in US and possibly global equities. However I won't go on a limb and try to time *when* this will happen. For the great depression and 2008, it took 5 years. I will be watching closely and trimming exposure to domestic equities in time.

Bottom line - I do not think this will end well

 

[Bible_Belt]

Lack of sufficient government regulation to combat loan fraud also played a big role in the 2008 real estate crash. Underwrite a loan that the debtor is not realistically able to pay back, then quickly sell it and pass it down the line before anyone notices that it's a bad loan.

 

[Red Legg]

If the greatest leader in the world (Trump) says net neutality is bad, then it's fvckin bad....mmmmkay..

 

[synergy1]

Synergy,

In your example you are conflating several things.

First and foremost, Greenspan lowered interest rates after the tech crash of 2000. He did this to stop a depression from forming due to the massive stock market bubble which had just popped.

His series of desparate rate cuts is what surged the real estate boom, and eventual bubble which did not really start until 2006, and then crashed spectacularly in 2008.

The tax cuts of 2001 and 2003 are a mere footnote when compared to these gargantuan events. It would be a huge mistake to think these were caused or are side effects of those tax cuts.

Both instances I listed were actually from a text, "Inside the house of money" by Steve Drobny which also discusses the roles of interest rates. With my limited knowledge of the markets, one could state its subjective which was a significant factor ( I think both had their roles). That said, this is work I have done for my own investment purposes. History has a way of playing out the same way again and again. There is a difference this time around which is that tax cuts are occurring as the fed tightens into uncertainty. [https://fred.stlouisfed.org/series/FEDFUNDS] Of course they have no other choice as interest rates have been so low for so long, they know that they will need a lever to pull if our economy ever pulls back again.

taking a step back, it seems to me that GDP growth is rather cyclical for all the obvious reasons ( credit growth, credit contraction). However, tax rates are much slower transient, so the two can be plotted together, and they are here:

http://www.epi.org/publication/ib364-corporate-tax-rates-and-economic-growth/

See Figure B. I am not going to extrapolate too much from this, but we can see GDP oscillations as the economy cycles from growths and declines. One observation is that we don't necessarily see sustained GDP growth as the capital and corporate rates are cut. And rates have decades to work their magic. In fact, we see larger GDP contraction as rates started to decline for selected periods. I understand these are only several data points and do not constitute a trend. But for me, to state GDP will grow because of lower effective rates does not seem to be supported on a quick glance at the data.

Now lets be clear here. I don't think taxes are the way to salvation as a country. I don't like the idea of increasing taxes so the government can pick winners in spaces like electric vehicles, corn ethanol, or things like that. I am only doing my best to look at the data and formulate approximate opinions which will help me invest in the future. To me, the implications of a tax cut will do the following ; give companies a boost on their bottom lines. However this shouldn't be confused with a robust economy as you need a strong mainstream base to consume for this to occur. And in my subjective opinion is that a tax cut will permit businesses to spend on any number of things. You stated correctly some will financially engineer their balance sheets, some will spend on expansion, but others will act in ways that won't necessarily boost the economy.

Lets wait and see how this plays out. We will have to revisit this in 10 years or so

 

[synergy1]

Lack of sufficient government regulation to combat loan fraud also played a big role in the 2008 real estate crash. Underwrite a loan that the debtor is not realistically able to pay back, then quickly sell it and pass it down the line before anyone notices that it's a bad loan.

Everyone was in on this. People chasing yields looked at credit ratings of the products, and they were satisfactory. I don't remember offhand, but the yields were ridiculous, 7% for the senior notes to 12% for the unsecured products. The purchasers probably didn't do that much homework on the underlying, but at the time it seemed unlikely that all mortgages would go belly up all at once. and 12% isn't bad for fixed income!

These are an example of the type of product that experienced unprecedented demand from the investor class back in the mid 2000s. If there is more demand to purchase, there will be more pressure by underwriters to develop these types of products, and start to cut corners. I am not saying that is what will necessarily happen next, but I believe its a possibility i'll be watching out for.

 

[synergy1]

Ultimately it is a compariaon of who gets the money for investing....the Government, or the private sector. It is the private sector which seeks returns on investment, and thus makes the wisest decisions overall towards growth and productivity.

Good bit to get the conversation back on track. And ultimately I agree with this as I feel excessive taxation where the government picks winners/losers is a bad thing. I don't have a problem with all taxes. The base case here is law enforcement and property rights. The second order things like roads and infrastructure do help the economy, and I am all for that. Where I am a bit on the fence personally are things like utilities, or things like our network that are hard for new private incumbents to enter. When you have resources and power concentrated like we do with ISPs, it seems bad things could happen. Should govnt come to save the day?

I say lets see how this pans out. As I tell all my super liberal friends, not all businesses are bad and not all government is good. People are still people at the end of the day.

Concerning my research on tax cuts, its not 100% exhaustive. I have a day job. I am not saying its the root cause in my opinion for all the reasons we both mentioned at one point or another. But in my opinion its significant. Droby's book was concerned with how all types of funds ( trusts, endowments etc) invest in different time periods. The breakdown from the book showed that of the 60 or so trillion dollars in managed assets globally, 30 trillion of that was in private wealth funds ( 1.5 was hedge funds as a comparison). Pension, insurance and mutual funds where about 20 trillion each. I would say these values are significant.

 

[synergy1]

I wouldn't identify myself much as a liberal mostly for this reason; someone who " look at wealth is an an entity to be tapped or consumed". I think I identify mostly as libertarian, but still have some elements that not all govnt is bad. i digress. To the first point, I often pose the same question to liberal folks as to why others wealth should be the target for confiscation. The answer usually involves the 'greater good'. This answer is not satisfactory since this is a highly subjective stance. And yeah my argument looked at assets mostly just to get a feel for scale. I follow the money, and the demand for financial products it creates. We aren't quite in 08 with the MBS mess, but there are some interesting things that I follow (short volatility, junk bonds etc) but they aren't horribly relevant to net neutrality. haha.

again my viewpoint should be looked at pragmatically, not so much right or wrong. Thats probably why our back and forth has been pretty civil as far as message boards go. It seems we agree more than we disagree.

Here is a quote from the article that I thought was unsurprising:

of the 20 public services that provided financial records between 2010 and 2014, 11 had negative cash flow,

Given governments lack of motivation for profits, this is an expected result. However I suppose I am OK with it provided this is the choice of a municipality and the people that make up that city. Sure, the enterprise itself might be a money sink, but at least its providing some utility to the people that live there, which might have positive spillover into other areas. For example, someone who might not have been able to start an online store can now do so? I suppose if its in the hands of the people, and they take responsibility ( net cash draw for the ISP), its not the worst thing in the world.

Speaking of Venezuela - I am not sure most people understand how badly this could spill over. Oil markets are tightening already, and they have some of the largest reserves on the planet. While their production isn't as high as the L48/KSA, any disruptions here could cause energy prices to increase and this will be burdensome on most of us. This country is a mess, and its proof that a simple economy that basically pays its people off doesn't work. Hyperinflation, starvation, unrest. its a mess.

okay i'll stop derailing and otherwise normal conversation!

have a good new years!