Tag: free market
Jeff Bezos

The Big Lie Jeff Bezos Tells About The 'Free Market'

There is no one on the face of this earth who depends more on the largesse of the American taxpayer than zillionaire Jeff Bezos. The man who famously, or infamously, announced last month that Washington Post editorial policy will henceforth be “in support and defense of two pillars: personal liberties and free markets,” ships about 1.6 million Amazon packages a day using taxpayer-built roads and skies controlled by the taxpayer-built and financed FAA air control system.

The same goes for every other billionaire whose products move on the public highways and local road systems. There is not a mile of the interstate highway system that wasn’t built with public monies, usually 90 percent federal tax dollars with 10 percent provided by the states through which the ribbons of asphalt and concrete pass. Those roads are maintained and kept safe with gas taxes Americans pay when they put fuel their cars. You will note, Jeff, that the federal and state surcharges on gasoline aren’t donations freely contributed by happy drivers. They are the thing you libertarians say you hate so much: taxes that have made you very, very rich.

Without taxpayer dollars, all those trucks carrying Bezos’ profits would be bumping along dirt roads getting stuck in the mud and skidding into ditches. The pilots of the cargo planes carrying Amazon boxes would be arguing with each other about who gets to take off first and which plane gets to fly which azimuth at what altitude from Chicago to Reno or Kansas City to Fort Lauderdale. Two or three mid-air collisions later, and people would be left to line up at Walmart to buy their boxer shorts and bras from Vietnam and Bangladesh, shipped to the store on the same taxpayer-funded roads used by Bezos’ trucks.

The iron in the trucks’ diesel engines, the aluminum sides of the trailers and the shipping containers filled with washing machines and refrigerators? All of it trucked from steel and aluminum producers to factories and from there to Home Depot or Lowes or Best Buy, so the wealthy men who own those stores, -- and they’re all men – pull down their millions and billions courtesy of, you guessed it, the American taxpayer they are all so contemptuous of because they don’t have the crooked accountants and off-shore tax shelters enjoyed by Trump and Bezos and their golfing buddies.

I could go on with the tax breaks local governments give Bezos and Amazon to get them to build minimum-wage warehouses in their fading towns and counties, with a reminder that every tax break given a corporation or billionaire is paid for by higher taxes on real estate and residents of those towns and counties.

But you get the picture. Bezos is the recipient of an especially egregious free ride on the infrastructure and systems built over the last hundred years or so that have made this country such a wonderful place to accumulate wealth. Billionaires like Bezos act as if our highway system and air control system was put there just for their companies to exploit and provide them with profits. Not only that, their political party, the Republican Party, has constructed a political church out of the lie that it’s time to cut taxes and forget upkeep of old infrastructure and building new bridges and roads. We’ve got ours, so fuck the rest of you.

That’s the thing about money. You get enough of it, and you can turn ideology into profit and profit into pain for all those suckers running down warehouse corridors trying to fill package delivery quotas by pissing in Coke cans and water bottles. Add some cosmetic surgery, a few personal trainers, and a 417-foot yacht, and you’ve got the new American dream, man, abs and all.

Lucian K. Truscott IV, a graduate of West Point, has had a 50-year career as a journalist, novelist, and screenwriter. He has covered Watergate, the Stonewall riots, and wars in Lebanon, Iraq, and Afghanistan. He is also the author of five bestselling novels. He writes every day at luciantruscott.substack.com and you can follow him on Bluesky @lktiv.bsky.social and on Facebook at Lucian K. Truscott IV. Please consider subscribing to his Substack.

Reprinted with permission from Lucian Truscott Newsletter.



The Right Question About Government

The Right Question About Government

SAN FRANCISCO — Many conservatives and most libertarians argue that every new law or regulation means that government is adding to the sum total of oppression and reducing the freedom of individuals.

This way of looking at things greatly simplifies the political debate. Domestic issues are boiled down to the question of whether someone is “pro-government” or “anti-government.”

Alas for the oversimplifiers, it’s an approach that misreads the nature of the choices that regulators, politicians and citizens regularly face. It ignores that the market system itself could not exist without the rules that government establishes, beginning with statutes protecting private property and also the various measures against the use of force and fraud in business and individual transactions.

More importantly, it overlooks the ways in which the steps government takes often empower citizens and expand their rights. Nowhere is this more obvious than in the realm of work.

The run-up to Labor Day this year brought a spate of news stories and commentaries on the actions of the National Labor Relations Board and other government agencies to strengthen the rights of workers and enhance their bargaining power relative to employers.

Last week, Noam Scheiber offered an important account in The New York Times of how the Obama administration has been “pursuing an aggressive campaign to restore protections for workers that have been eroded by business activism, conservative governance and the evolution of the economy in recent decades.”

Among the milestones Scheiber cited was a recent Court of Appeals decision upholding an Obama-era rule providing minimum-wage and overtime protections to nearly 2 million home health care workers. They certainly felt empowered by government, not oppressed. So did the employees of contractors and franchises who were granted collective bargaining rights by the National Labor Relations Board.

Fast-food chains provide the obvious example of how loopholes related to new work arrangements and franchise agreements can let employers out of their traditional obligations. In the case of purveyors of hamburgers and chicken tenders, the parent companies set all sorts of detailed requirements for how these businesses should operate — and then turn around and claim that when it comes to workers’ rights, their franchises are utterly independent.

One of the most fascinating struggles, still ongoing, is over new regulations that the Labor Department is trying to establish to ensure that those who give investment advice to people with 401(k)s and individual retirement accounts base their judgments on the best interests of their clients. Along with defined-contribution retirement plans, they involve some $13 trillion in investments.

The Labor Department proposal would require investment advisers to abide by a “fiduciary” standard — meaning that the best-interest-of-the-client yardstick should be their sole criterion in offering counsel to clients. If this seems obvious, that’s not what the current law requires. As Secretary of Labor Thomas Perez said in an interview, the standard now is only that an investment be suitable. “What the hell is ‘suitable’?” Perez asked, noting that he would hope for more than just “suitable” advice from his doctor.

The issue is whether some investment advisers might offer conflicted guidance influenced by “backdoor payments and hidden fees often buried in the fine print,” as the Labor Department put it in a document explaining why change is needed.

“I don’t believe that folks who provide advice wake up with malice in their hearts,” Perez said. But he added that it is only natural that advisers might lean toward investments from which they can also benefit. “Surprise, surprise, if you have four or five products that are suitable and one gives you a commission, guess where you will go?” The new rules, which are being heavily contested by parts of the financial industry, are an attempt to realign the incentives, Perez argued.

The investment-rule battle is a near-perfect example of how the government is plainly promoting free markets — what’s more market-oriented than building an investment portfolio? — but is also trying to make sure that the rules regulating the investments tilt toward the interests of the individual putting his or her money at risk.

As long as there are markets, government will have to establish rules determining how they operate. These necessarily affect the interests of market participants. Many of the choices are not between more or less government. They are about whether what government does provides greater benefit to workers or employers, management or unions, individual investors or investment firms.

“Which side are you on?” This question from the old union song is the right question to ask about government.

E.J. Dionne’s email address is ejdionne@washpost.com. Twitter: @EJDionne.

Photo: House Committee on Education and the Workforce Democrats via Flickr

Free Market America? Yes, But With Limits

Free Market America? Yes, But With Limits

Washington (AFP) – The United States portrays itself as a bastion of the unfettered free market, but when foreign firms launch takeover bids for American businesses things are not always so laissez faire.

The United States is the world’s top destination for foreign investment.

Business leaders here scoff at protectionism, such as the French government’s opposition to U.S. engineering giant General Electric’s bid for the energy business of French rival Alstom.

“There’s a sense here that the highest bidder should prevail,” said Mitchell Marks, a mergers and acquisitions specialist at the University of San Francisco.

Last year, Softbank of Japan acquired Sprint, the third largest American mobile phone carrier. And Smithfield Foods was bought by a Chinese investor for around $7 billion.

But there are limits to this openness, first because of concerns over competition but mainly when the transaction involves assets linked to “national security” or “crucial infrastructure” under current law.

In these cases, takeover bids are examined by the Committee on Foreign Investment in the United States (CFIUS).

This panel brings together representatives of the Treasury, State and Defense departments as well as domestic intelligence services.

After an assessment period that can last up to 75 days, the committee can approve the bid, require changes or, in the most extreme case, recommend that the president simply nix it.

In September 2012, President Barack Obama blocked Chinese companies from acquiring wind power farms in Oregon on that grounds that they were located near a U.S. military base.

“It is a unilateral, non reviewable decision and he doesn’t have to justify it,” said Samuel Thompson, author of a book entitled “Fusion, Acquisition and Tender Offers.”

A review does not even have to go as high as the White House.

Political pressure can also influence the process, especially when the takeover bid comes from a country with delicate relations with the United States, such as China or Russia.

“Many foreign buyers are surprised by the number of takeover defenses that are available to U.S. companies,” said James Hanks, a mergers and acquisitions lawyer with the firm Venable LLP in Baltimore, Maryland.

In 2006, facing opposition from Congress even though it had the green light from the White House, the United Arab Emirates firm DP World had to give up on a bid to acquire management business at six American seaports including New York.

Opponents of the deal had noted that two of the perpetrators of the September 11, 2001 terror attacks were born in that country, and this was enough to trigger a media reaction.

In 2005, the Chinese company CNOOC withdrew a takeover bid for the oil firm Unocal, saying it was the victim of the “political climate” in Washington. The state-run press in Beijing complained at the time that the U.S. economy was not free and open.

The mere fact that a takeover bid can be assessed by U.S. authorities is enough to cool foreign firms’ acquisition appetite, the Congressional Research Service said in a report published in March.

Since 1990 nearly half of foreign takeover bid by foreign firms that were subjected to study were abandoned by these companies without even waiting for a verdict, this agency said.

It said companies do not want to be associated with anything that smacks of a threat to U.S. national security.

In 2008, the investment fund Bain Capital, allied with the Chinese group Huawei, dropped its bid to acquire the American high tech firm 3Com, fearing objections from the CFIUS.

But allied countries like France, for instance, generally find less resistance on American soil. In December 2006 the telecoms group Alcatel won permission, albeit with strings attached, to take over the U.S. firm Lucent.

“If it’s a company placed in a country that is as close to the U.S. as France or the UK, I think that the chances of the transaction being barred are very, very small,” said Thompson.

©afp.com / Philippe Lopez

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