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Friday, March 20, 2015

The inequality of austerity

For all the talk about the "idle poor" and lazy Greeks, let's not forget that corporate welfare to the "idle rich" and politically connected Greeks is often rather substantial. That's not just a left-wing talking point, in this age of banking bailouts, the subsidies to the very rich may actually exceed those to the overtly government dependent. It's clear that the burden imposed by the IMF is not falling, like the rain, on the rich and poor alike.
Greece’s unbalanced austerity and drastic increase of poverty. The poorest households in the debt-ridden country lost nearly 86% of their income, while the richest lost only 17-20%.  The tax burden on the poor increased by 337% while the burden on upper-income classes increased by only 9% !!! This is the result of a study that has analyzed 260.000 tax and income data from the years 2008 – 2012.

According to the study commissioned by the German Institute for Macroeconomic Research (IMK) affiliated with the Hans Böckler Foundation:

- The nominal gross income of Greek households decreased by almost a quarter in only four years.

- The wages cuts caused nearly half of the decline.

- The net income fell further by almost 9 percent, because the tax burden was significantly increased
When you see statistics like that, you sort of assume that there will be some sort of revolution taking place, and frankly, it would be hard to blame them. Crony "capitalism" of the sort we've seen dominate the Western economies since 2008 is not something that any genuine capitalist should support.

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45 Comments:

Anonymous MrGreenMan March 20, 2015 3:36 PM  

I remember hearing once from a management professor talking to a group of fresh MBA candidates about labor relations:

"Remember, if you push them too far, there will be violence."

The bankers of this generation seem to assume that there is no need for the old noblesse oblige.

Blogger ajw308 March 20, 2015 3:41 PM  

last night, on YouTube, I watched parts 1 & 2 of "Sisi, Cocaine of the Poor". It looks like cheap meth. The whole documentary took place in Athens and it looks like the poor and destitute are simply to stoned to care or do anything. There did seem to be a faction that wasn't using, but they just fought to drive the addicts out of their neighborhoods.

I think to many of them are stoned/high and those who aren't, aren't planning ahead far enough.

Anonymous Will Best March 20, 2015 3:45 PM  

I won't deny legitimate problems but there are issues with these statistics

For example if my tax burden goes up 10% FedGov collects another $2k, but if somebody in the 40-50% income bracket pays 330% more the federal government collects an additional $300.

The net worth statistic is also a bit misleading. If you only have $10,000 and lose your job for 3 months, your net worth will be decimated. On the other hand if you $100,000 you will weather the storm better. Same is true when you suffer at 25% pay cut and supplement spending from savings rather than slash your spending.

Blogger LP 999/Eliza March 20, 2015 3:51 PM  

There are no more solutions to these above the law situations.

Prayer and enduring in this comical sick world.

Blogger LP 999/Eliza March 20, 2015 4:00 PM  

The poor bankers and wealthiest need their money to build fortified bunkers, they are preppers too.

Anonymous Scintan March 20, 2015 4:06 PM  

I'm shocked, Shocked, to see people manipulating tax and finance statistics to further their agenda!

Anonymous Maximo Macaroni March 20, 2015 4:11 PM  

Analyzing tax data from places like Greece can be wildly misleading. The harder times get, the more people shift to the underground economy

Anonymous Athor Pel March 20, 2015 4:12 PM  

Tax burden increases of 337% are enough to motivate anyone to report a lower income.

You want to do business in cash? Just fine with me. And don't ask for a receipt or expect the receipt to not correspond exactly to the work done or product delivered.

Blogger Joshua Sinistar March 20, 2015 4:17 PM  

Corporate Welfare is just a buzzword. In truth, capital is sucked by the Vampires through business subsidies and through welfare programs. Those dirty Mexicans full of diseases are mowing the lawns of Bloombagger and the H1-Bs are getting a free ride to America for Suckerberg's Fakebook. There's no difference. The White Man built this country and without him this place is going to sink into a Turd World Swamp.
White people don't have a Government, they have an enemy that is bought and paid to destroy them and their posterity. Its the road to nowhere. These jews will never rule the World. Everyone hates them now. Who will fight for them now?

OpenID mattse001 March 20, 2015 4:33 PM  

It pains me to admit it, but the lefties may finally have a point. Of course, it was the lefties who removed all the restraints on the cronies, with a little help from the right.

Blogger Jourdan March 20, 2015 4:47 PM  

Vox - Totally off topic, but I see an old favorite of my, Lord Valentine's Castle, appearedon your book list. I'd like to hear your thoughts on it.

Blogger LP 999/Eliza March 20, 2015 4:57 PM  

I am done with the local, national and global theater of (not a persecution complex) but a spirit of "we must deny, hinder and sabotage any efforts of the middle class", there is a legion of people who dont want anyone to have anything.

Anonymous Brain Death March 20, 2015 5:45 PM  

Indeed, if you are going to prune the welfare state it would be best to start at the top and work your way down.

That said, the main advantage "Proles" on welfare offer PTB are their raw numbers on election day.

Blogger JAY WILL March 20, 2015 5:49 PM  

I was watching Tony Blair on an ITV programme about UK immigration yesterday, as soon as he opens his mouth lies are destined to escape. Thats modern politicians for you. I've some experience of this, the non-fakers are weeded out in the natural process of politics. For the average politician the private and public divide will allow them some sanity, for those higher up they have to churn it out 24/7. To get to the top its not enough to be able to lie, you have to become a living lie. Blair, Cameron types don't turn off when they go home. They have to genuinely believe their lies. Is that in some way a kind of alpha trait?

It hits you to listen to people in private who are nothing like what they represent in public. I realize everyone knows this, but actually seeing it in front of you is a different experience. Their all chasing money, and also celebrity. How many famous people you met this week chief!

I think the big banks were only bailed out to prevent anarchy/rioting in the West. Millions of people in US and Europe who have been softened by their relative material wealth would have faced a brutal amygdala awakening if they lost life savings etc. Politicians, bankers etc bailed it out to protect their own lives/safety not their wealth. When one of the sheep loses their life savings its everything. People can change very quickly. I think the "elite" fear being exposed, it usually doesn't go well does it.

Anonymous BluntForceTrauma March 20, 2015 6:01 PM  

Crony capitalism only since 2008? Ha! Better revise that figure like the Bureau of Labor Statistics revising last month's data!

Anonymous Cash March 20, 2015 6:09 PM  

"Is that in some way a kind of alpha trait?"

I believe the word is sociopath.

Anonymous Cash March 20, 2015 6:18 PM  

There has been a big push among the Ron Paul and Tea Party types against corporate well fair in my state. They have held debates with members on the economic development boards and outed a lot of politicians for their back room deals.

Of course we will never win on this issue on the national stage. The Left will say something like "see what capitalism gets you! Close the banks and nationalize bla bla." And the right will defend capitalism while trying to get into the nuances of Fascism and true free market capitalism, etc.

The cronies will say "if you can't beat 'em join 'em." And they will give their money to the Democrats to buy their seat at the table and the Conservatives will have poo on their faces. It is so freakin' predictable.

Blogger Joshua Sinistar March 20, 2015 6:38 PM  

Politics is nothing but theater at this point. Very few if any of these professional liars actually believes anything. Some have agendas based on sexual perversions or similar dysfunctions, but this two party system is just Janus the two-faced god of lies.
What difference is there if the money goes to the Rich through corporate tax breaks and crony contracts or to subsidize their brown slaves that toil on the modern plantation of fast fat food and retail from Labor Camps in Communist Hellholes?
The fact is that Capitalism and Communism are two sides of the same coin. The Banksters own the Socialists lock stock and barrel. Hillary has money from Warren Buffet, Bill Gates and even Rupert Mole News Murdoch!
Its neo-feudalism where they are the robber barons and everyone gets to be a serf or slave. How do you own anything if you have to pay thousands of dollars to the Government to keep it? After signing away thirty years of your life to indentured servitude to get a worthless deed that entitles you to nothing. You can't even hang a flag or put up a shed on your "property" without getting permission from the Governors.
Simon says you are a sucker!

Blogger James Jones March 20, 2015 6:52 PM  

The biggest problem with this perversion of Capitalism, is that the Left can't differentiate it from real Capitalism. So therefore, it helps the argument for even more State control. I see average people here in the UK, saying that State ownership of everything is the only way to deal with it. Shudder.

Anonymous Rolf March 20, 2015 6:58 PM  

Of course, it's easy to lie with stats. A tax increase on a poor man from one dollar to $4.37 is a 337% increase, whereas the "measly" 9% increase on the higher income from$10 million to $10.9 million is a sizable hunk of money. In the US, the lower half of household incomes pay roughly 3% of the total tax burden. More details necessary to say if this is really bad, or same-old-same-old demagoguery.

Blogger Eric March 20, 2015 7:01 PM  

What difference do the tax rates make? Greeks don't pay their taxes.

Anonymous Starets March 20, 2015 7:02 PM  

@Joshua Sinistar
"White people don't have a Government, they have an enemy that is bought and paid to destroy them and their posterity."

That's a great line; I agree completely.
It should be repeated widely.

Blogger Joshua Sinistar March 20, 2015 7:04 PM  

How can poor people pay taxes at all? They're poor! These illegals are getting checks from the Government when they file taxes. Its subsidized slavery!
I don't believe for a minute that the Rich are paying taxes! Corporations like GE, Apple and Google literally pay nothing! The only reason we know this is that corporations have to file financial disclosures, but Rich Billionaires have private tax returns. Everyone knows that "charitable" trusts like the Gates Foundation are merely tax shelter to keep Uncle Sugar from getting his grubby hands on their moola!

Blogger ajw308 March 20, 2015 7:28 PM  

The way we view "bread and circuses", they'll view "drugs and reality tv" in two millenia.

Blogger Tommy Hass March 20, 2015 7:40 PM  

Btw, could Vox post that 5 word phrase that identifies a gamma?

Anonymous lozozlo March 20, 2015 7:52 PM  

Appropriate to the current discussion

Basically, it is imporant to keep in mind that capitalism, while not inherently immoral like the left seem to think, is however *amoral*, so the behavior of the corporate plutocrats should surprise no one.

Anonymous lozozlo March 20, 2015 7:58 PM  

Also please keep this in mind

Anonymous Starets March 20, 2015 9:00 PM  

@lozozlo

Interesting article on our modern lack of leisure time compared to medieval peasants: http://www.moreright.net/reaction-and-the-poor/ I've seen similar articles, which have made me think about that topic.

My understanding is that productivity has increased significantly over the past one hundred years, maybe even over the past fifty years or less (someone correct me if I am wrong).

If that is in fact the case, then the fact that many of todays workers need to work longer and longer hours just to get by would seem to indicate to me that todays economy has been set up as a giant skimming operation. Essentially, the labour class is being squeezed to do more and more for less and less. Probably multiple mechanisms are being used to this effect, such as mass immigration to drive down the cost of labour, debt based money, and widespread usury to trap people into wage slavery.

I wonder what would be the solution to all this?

Blogger Joshua Sinistar March 20, 2015 9:15 PM  

Look, its not for nothing that the Holy Bible says the Love of Money is the Root of All Evil. Capitalism is not the same as business. Henry Ford didn't start the Ford Motor Company just to make money. He had a dream of making affordable cars that average Americans could drive that spawned an entire culture of car nuts and family outings in an automobile on the open roads of the mass transit system that created thousands of jobs for Americans to build.
Capitalists are just money grubbing greedy bastards that want to become Rockefeller Robber Barons and corner a market to create a monopoly. They fund the campaigns of pathetic losers like Obama, Clinton and Bush to create onerous regulations to squeeze out the competition and keep little guys from ever making it big enough to break the stranglehold they have on the market.
There is no Free Market, and there never was. Its a pay for play system where the bribes flow in Washington to get sweetheart deals and guaranteed contracts that make them rich and keep competition non existent. Just about every sector of the economy that died is owned and operated by a small cabal of insiders who maintain a strict clique that freezes anybody else out.
Capital is merely a number put on the value of goods and services provided by merchants and farmers and tradesmen, but its been taken over by a Legalized Counterfeiting Racket called a Central Bank where the insiders have an almost unlimited supply of funny money to bankrupt competitors and freeze out innovators.
The only real solution is to abolish the Federal reserve or jail and kill all the owners and have an honest Government that controls the money in an impartial way to allow innovators and newcomers to establish businesses and markets that put Americans back to work.
The Federal Government is unwilling to do this as they are bought and paid for Judas Goats. They have to step aside or be forced out.

Blogger Eric March 20, 2015 9:15 PM  

If that is in fact the case, then the fact that many of todays workers need to work longer and longer hours just to get by...

The definition of "getting by" has grown much faster than productivity.

Anonymous Anubis March 20, 2015 9:34 PM  

The greeks need to repudiate their debt like Iceland & plan to arrest the people that got them in this mess like Iceland did. The last data I saw said 1/10 of the population of Greece is illegal alien, Golden Dawn coming to power would be the best thing for Greece and Europe.

In the US illegal aliens commit fraud to get checks from the IRS if any of us did that we would be put in jail.

Anonymous zen0 March 20, 2015 9:36 PM  

@ Joshua Sinistar (March 20, 2015 9:15 PM )
Look, its not for nothing that the Holy Bible says the Love of Money is the Root of All Evil.


Joshua, a word please.

More study, less expoundation. ......... For instance, Moses studied the book of Job. That was his Torah BEFORE the Torah for him.

Have you done that yet?

Well, have you, punk?

Anonymous Heaviside March 20, 2015 9:45 PM  

Weltoktober 2017!

Blogger Joshua Sinistar March 20, 2015 9:47 PM  

The book of Job? Where God lets the Devil torture Job and kill his family to test his Faith? What has Faithfulness got to do with a Deadly Sin like Greed?

Anonymous zen0 March 20, 2015 9:55 PM  

@ Joshua Sinistar ( March 20, 2015 9:47 PM )
The book of Job? Where God lets the Devil torture Job and kill his family to test his Faith? What has Faithfulness got to do with a Deadly Sin like Greed?


Yah, that one. Have. You. Read. It.?

Blogger Joshua Sinistar March 20, 2015 10:00 PM  

Why don't you read The Book of Revelation. Its a lot more relevant to this topic. America is turning into Babylon. Babylon was the reason the Earth was destroyed by The Angel of Death with the great flood that only Noah and his family survived.
It was bad enough when Hollywood and New York City and Las Vegas were like Babylon, but if America goes full Babylon the Book of Revelation is going to be much more appropriate.

Anonymous zen0 March 20, 2015 10:41 PM  

@ Joshua Sinistar( March 20, 2015 10:00 PM )
Why don't you read The Book of Revelation. Its a lot more relevant to this topic. America is turning into Babylon. Babylon was the reason the Earth was destroyed by The Angel of Death with the great flood that only Noah and his family survived.
It was bad enough when Hollywood and New York City and Las Vegas were like Babylon, but if America goes full Babylon the Book of Revelation is going to be much more appropriate


You are using CAPS, but not exclusively. It is still a CAPSLOCK VIOLATION.


Blogger Rantor March 21, 2015 7:43 AM  

I get suspicious when I read income and tax parity articles... Read the other day that Pinketty's income estimates which showed the poor in the US decimated while the rich are getting richer, failed to include the welfare going to the poor. If you count their welfare checks, the poor have continued to increase their income.

This does not mean that we should ignore the problem of crony capitalism. I would like to see honesty in politics, the end of agricultural, export, property tax, and other such transfer payments to the wealthy. More importantly we need to see the end of ZIRP loans to the ultra rich. Tax dollar bailouts of banks that end up paying bonuses to the somehow failed but suddenly successful bankers. I'm sure if the government gave me billions in free money I could ensure that some of it landed in my pocket... But that is not capitalism. Or perhaps I should say, that is not free market economics.

Obviously allowing non-property owners to vote was a mistake, along with direct election of Senators. Even a wholesale collapse of the economy will be used by our government to enrich friends and destroy the middle class. A country run by pathetic, narcissistic, ignorant and greedy people can not succeed. But the fat ignorant masses watching Wendy and the Today Show aren't going to do anything about this. I don't think Glenn Beck and his fans will either. Pray for divine intervention and prepare for the worst while expecting that the system will continue muddling for a good while.

Blogger MATT March 21, 2015 7:48 AM  

Rantor its too late for "we need to stop this and that and go back to lah blah", its over and done. The country is finished. It was inevitable and the Founders knew that when they started. They just didnt want to deal with the King anymore and figured what the hell.

Blogger Joshua Sinistar March 21, 2015 8:36 AM  

Actually the US Constitution anticipated that at some point the tenets of democracy would seep into the structure of their Republic and a repeat of the decline of Rome with ruthless demagogues using Bread and Circuses would try to destroy what they built. They ingeniously designed the system where the Citizens do not swear loyalty to the Government but to the US Constitution. The US Constitution is where American Citizens swear their fealty and must preserve over all else. The US Constitution also provides the legitimacy of the Government which if suspended no longer has legitimate powers of Governance.
Cynics will suggest that such rhetoric is trivial as the Government has sufficient force to bend the citizens to their will with Military and Police power, but I find that to be a vast overstatement of the abilities of the Bifurcated Two Faced Janus Ponzi Scheme on the Potomac.
I think the poor showing of emergency planning and action during Hurricane Katrina and the much milder Hurricane Sandy showed everyone that the Federal Government is just a paper tiger without the vast force that it is supposed to possess as a Superpower.
The Military HATES the Government more than the people do, and this vilification of the police where they are now being shot has probably got them questioning the value of loyalty to these demagogues who are sacrificing their lives needlessly to push a tired narrative no one even believes or listens to anymore.
Napoleon said that the Morale is to the Material as 3 to 1. The patriots and especially Whites fight for freedom and survival for themselves and their posterity while the G Men are just paycheck Soldiers of Fortune. Back during the Revolution the British had the Best Army on Earth and the Hessions were the best mercs that money could buy. However, they lost badly to farmers with squirrel guns who hunted and fished while they waited for supplies from miles away.
Without popular support Government is going to have a hard time fighting an insurrection. Most of their troops are demoralized and questioning the value of the system already.

Blogger YIH March 21, 2015 8:49 AM  

Joshua Sinistar:
Corporate Welfare is just a buzzword. In truth, capital is sucked by the Vampires through business subsidies and through welfare programs. Those dirty Mexicans full of diseases are robbing from both ends of the spectrum.

Anonymous lozozlo March 21, 2015 11:36 AM  

@Zeno

I'm not sure I understand what you are getting at with your posts, replying to Joshua who was in turn replying to what I had posted...

Anonymous lozozlo March 22, 2015 8:33 PM  

The definition of "getting by" has grown much faster than productivity.

Hardly - yes the living standard now is much better than that of the medieval peasant, but the growth in productivity due to computing and industrialization is far greater than even that.

Blogger Eric March 23, 2015 4:33 AM  

Hardly - yes the living standard now is much better than that of the medieval peasant, but the growth in productivity due to computing and industrialization is far greater than even that.

Adjusted for inflation, median income in 1940 was something like $9500. The idea people are working harder and harder to just "get by" is simply not borne out in the data. What's happened is people have adjusted up what they consider the rock bottom lifestyle to something their grandparents would have considered wealthy.

OpenID cailcorishev March 23, 2015 8:55 AM  

Eric, you're right that most people have higher expectations. But I've lived on that much, and while it's doable, it's not easy. There are two main things that make it harder to live frugally on a small income than it used to be: taxes and doctoring. Those two costs have skyrocketed. You can get rid of the cable and the Internet, the car and the phone, even the indoor toilet and running water, and strip your life down to a shack on enough land to raise your own food. But they're still going to tax you for that land, and if you ever need a doctor for even something simple, it'll cost you more than all the rest of your expenses for months. No trading the doctor a goat for delivering a child, that's for sure.

But the taxes are the big thing. Even poor people face taxes and fees that their grandparents didn't, and they don't have much choice about those.

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