Thursday, March 28, 2013

Takers And Makers-- Paul Ryan vs Jesus


Whether you believe in Satan as an existential concept or as a bogeyman-- or, if you're a Mormon, as Jesus' bro-- no one would be a better representative of the doctrine's inherent Hellish precepts than Wisconsin mutinous Catholic Paul Ryan. Once again, the U.S. Conference of Catholic Bishops have denounced Ryan's immoral budget that makes a mockery of the most fundamental teachings of Jesus Christ. Paul Ryan's message-- the message of the entire GOP these days-- is all about "takers" vs "makers." Jesus' most basic teaching:
Blessed are the poor in spirit, for theirs is the kingdom of heaven.
Blessed are those who mourn, for they will be comforted.
Blessed are the meek, for they will inherit the earth.
Blessed are those who hunger and thirst for righteousness, for they will be filled.
Blessed are the merciful, for they will be shown mercy.
Blessed are the pure in heart, for they will see God.
Blessed are the peacemakers, for they will be called children of God.
Blessed are those who are persecuted because of righteousness, for theirs is the kingdom of heaven.
This week, Les Leopold, author of How To Make A Million Dollars An Hour: Why Hedge Funds Get Away With Siphoning Off America's Wealth, reported at the Corporate Social Responsibility Newswire on why Jesus reacted so violently to hedge fund managers money changers. He mentions that "In 2009, David Tepper, the head of the Appaloosa hedge fund, earned an astounding $4 billion. Personally. (That’s $1,923,076.92 per hour.) The following year, John Paulson of Paulson and Co. broke Tepper’s record, hauling in $4.9 billion, or $2,355,769.34 per hour!"

In case you don't recognize the names, Tepper and Paulson are major Republican Party donors. Tepper, for example, wrote Romney's Restore Our Future PAC a check for $375,000 and then gave the right-wing American Unity PAC $150,000, part of the money they used smearing Raul Ruiz, Bill Foster and John Tierney. Last year he also wrote a check to the RNC for $30,000 and then gave the NRSC and NRCC $20,000 each on the same day. Paulson is even worse and in the last few years gave immense sums to reactionary candidates-- mostly Republicans but also Wall Street-friendly Democrats-- including a cool $1,000,000 single check to Romney's Restore Our Future PAC. But Leopold's point wasn't political, per se. It's that "each firm reportedly earned around $20 billion. More amazing still is that they earned these enormous incomes during the two most horrific economic years since the Great Depression-- and they did it with only a skeleton crew."
So, here’s the real puzzle: How did these two hedge funds, which have fewer than 100 employees each, make as much money as Apple Inc., which relies on the hard work of its nearly 30,000 U.S. employees (and the incredible hard work of another 700,000 workers and contractors globally)?

Hint: Produce nothing tangible for the real economy. Don’t waste your time inventing or manufacturing stuff. In the hedge fund game, you don’t make-- you take. And for good reason.

Making things or providing services to large numbers of people is a complicated business. You have to have a marketable idea, probably a brilliant one. You have to hire workers. You have to manage them. (You may even have to deal with a union, God forbid.) You need to build a spirit of cooperation and a culture that values high quality and customer service.

And don’t forget the R&D you'll need to keep the innovation flowing. Of course, you also have to compete in a crowded global marketplace, create an entirely new niche, or both. It’s the kind of work that keeps you up at all hours. The sweat in sweat equity is real. No way do you want to go near this game when you could run a hedge fund instead.

But surely this is a gross exaggeration, say the hedge fund cheerleaders-- a group of academics and journalists who consistently come to the defense of hedge funds. They argue that hedge funds make all that money because they are as important to our economy as Silicon Valley. That's quite a claim. In this chapter we examine in detail this potent defense of hedge fund prowess.

In terms every reader can understand, we take you through all the wonderful things that hedge funds are supposed to provide, starting with financial innovation and ending with how hedge funds supposedly absorb and reduce financial risk in our system. Here's an excerpt from my book that concludes this debate:

Unless you ’re Rip Van Winkle and slept through the Great Recession, you won't have any trouble seeing through a few more hedge fund apologias.

Hedge funds are supposed to “reduce the danger that economies will over-respond to shocks.” So, where were they when markets were collapsing? They were destabilizing Lehman Brothers, GM, AIG, and any other company they could find to bet against
Hedge funds “reduce the chances that markets will rise to unsustainable levels in the first place.” But somehow they missed the biggest housing bubble in history?
Hedge funds “actually diminish the risk of the nightmare scenario.” Whoops.

In sum, industry cheerleaders can’t come near to answering our initial question: what value do hedge-fund elites create in exchange for their million an hour?
Back to Jesus for a second. He had a different way of warning about these charlatans-- although I doubt Paul Ryan ever puts his Ayn Rand books down long enough to take a look at it:
Watch out for false prophets. They come to you in sheep’s clothing, but inwardly they are ferocious wolves.
By their fruit you will recognize them. Do people pick grapes from thornbushes, or figs from thistles?
Likewise, every good tree bears good fruit, but a bad tree bears bad fruit.
A good tree cannot bear bad fruit, and a bad tree cannot bear good fruit.
Every tree that does not bear good fruit is cut down and thrown into the fire.
Thus, by their fruit you will recognize them.
One more little thingie. Chairman of the House Budget Committee, Ryan has taken $895,928 from Insurance companies, $881,749 from Wall Street firms, $411,309 from the real estate industry and $331,595 from commercial banks. No conflict of interest there, right? Oh... and $234,555 directly from lobbyists themselves. Serious!

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At 12:33 PM, Anonymous me said...

The problem with using religious doctrine as an argument is that anyone can create any doctrine at all, which always happens, and that doctrine need not be based on anything at all, which also always happens.

I suppose that ultimately, all principles have been pulled out of someone's ass. But that means neither that we can have no principles, nor that we have to accept unquestioningly something that was passed down from hundreds or thousands of years ago. We must have principles that 1, we can all or mostly all agree on, and 2, are amenable to thoughtful modification.

In view of the multiplicity of religions and their almost uniform inflexibility, neither of those conditions is met by religious dogma. That is why I do not refer to any variety of it when making an argument.

At 4:57 PM, Blogger Dennis Jernberg said...

I'm with @me on the religion issue. Ryan represents a Jansenist version of the great American tradition of Vulgar Calvinism. Besides, anybody can quote-mine scripture for any reason. Me, I'll stick to reason.


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