Sunday, January 04, 2009

Is Bernie Madoff a Heroic John Galt?

Bernie Madoff deprived the super-wealthy of $50 billion, without resorting to the Estate Tax (a/k/a the Paris Hilton Tax) or armed robbery.

According to Republican economic theory, we should be throwing roses at his feet.

By fleecing the wise uber-wealthy folks of some $50 billion, he had provided a supply-side burst of incentive to those fine people to regain their former wealth. Those captains of industry are now incented to the tune of $50 billion, just to get back to where they thought they were a couple weeks ago. Better yet, he accomplished his gift of incentive without spending the money on wasteful government programs such as school lunches or welfare that simply disincentivize the poor. And BEST yet, he did it in a fashion that owes its existence to the under-regulated market the the Republicans have made a fetish of.

The bedrock of Republican "Economic Theory" is that incentives for the super-wealthy are critical. The wealthy - not lazy unionized workers, pampered teachers in our schools, or grossly inefficient government civil servants - are the supermen who, with their finely attuned, market-sensitive, invisibly guided wise hands are the ones must be allowed to keep their billions and billions of dollars, so that they remain incentivized to create more wealth. Taxing the wealthy hurts us all, they claim, because the wealthy will no longer feel the incentive to work, and we will all suffer in their absence.

The timing could not have been better, either. With Obama's election, rightwingers were beginning to darkly (inappropriate pun intended) mutter about the "John Galt Option" or "Going John Galt
", in a reference to a character in a very bad novel who withdraws his productive force from the economy when the unproductive "looters" seek to tax his fortune. Rightwingers were threatening to slow down their productivity in the prospect of having to pay for the war they supported.

Dr. Helen, in a pre-Madoff meditation on the possiblity of an Obama administration, sets out the thought process that motivates those who would imitate John Galt:
Perhaps the partisian politics we are dealing with now is really just a struggle between those of us who believe in productivity, personal responsibility, and keeping government interference to a minimum, and those who believe in the socialistic policies of taking from others, using the government as a watchdog, and rewarding those who overspend, underwork, or are just plain unproductive.

Obama talks about taking from those who are productive and redistributing to those who are not -- or who are not as successful. If success and productivity is to be punished, why bother? Perhaps it is time for those of us who make the money and pay the taxes to take it easy, live on less and let the looters of the world find their own way.

If Republican incentive-based economic theory is valid, then Bernie Madoff was the right man at the right time to boldly create incentive in an economy that was going to hibernate until a new administration of deregulation, no watchdogs and deficit spending could reverse Obama's plans. Instead, thanks to the heroic Bernie Madoff, the John Galts of this world are waking up to find themselves in a $50 billion hole in an economy that needs more of their "wise" investments. They now have the incentive to rejoin the economy.

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Anonymous Anonymous said...


You actually make some sense when you talk about beer.


1/04/2009 11:58 AM  
Blogger m.v. said...

I don't know what drives the economy but you are definitely right that it's "not lazy unionized workers, pampered teachers in our schools, or grossly inefficient government civil servants"

1/04/2009 12:17 PM  
Anonymous Anonymous said...

That's not entirely how I understand it. Some of the super wealthy were taken, the ones lower in on the investment scheme. But he also hurt some very large charitable organizations that funded a host of good work. For example many environmental groups are really hurting right now. But Republicans would most certainly cheer that fact as well, so I guess it's a win-win all the way around.

1/04/2009 2:21 PM  
Anonymous Anonymous said...

Whether you agree with Ayn Rand's point of view, she never condoned fraud and theft.

1/04/2009 3:29 PM  
Blogger Dan said...

But Republicans thrive on it - that's their corrupt special twist to the goofiness that is libertarianism.

1/04/2009 4:20 PM  
Anonymous Anonymous said...

Dan's blind loyalty combined with his ability to always blame the "other side" for his country's problems would have made him a valued citizen in Germany about 70 years ago.

1/04/2009 8:24 PM  
Anonymous Dan's Neighbor said...

Dan you never say a word about financial regulation until all Hell breaks loose.

Where was all this brilliance when the fraud was happening Dan?

Piling on is a form of cowardice.

There were local writers who were raising the red flag over the years, but that might have caused some problems for Catholics who make a lot of money from banking, insurance or securities. Somehow you were real quiet then.

You have now morals, ethics or worth Dan. You go for the profit.

1/04/2009 8:49 PM  
Blogger I Travel for JOOLS said...

I find it interesting that you blame this on the Republicans. Maybe you should do a little googling or watch the news once in a while. Speaking of Madoff:

"Since 2000, he has given at least $100,000 to the Democratic Senatorial Campaign Committee and more than $23,000 to the party’s candidates, including Senator Charles Schumer of New York and Senator Frank Lautenberg of New Jersey, who leads a charitable foundation that invested with Madoff."

1/05/2009 9:24 AM  
Blogger les said...

Oh dear, let the glibertarian pearl clutching begin. Dan, I suspect your detractors--who seem to have become more detached from reason and reality, and more firmly wedded to hobbyhorses, lately--may be as essential to the economy as Dr. Helen herself. We should be so lucky as to have them all go Galt at once. Perhaps we could establish something like a societal version of the Darwin Awards, to keep track.

Madoff would appear to be a hero of trickle down; his only error from a Repub/glibertarian point of view was he didn't limit his takings to the working class. He certainly seems to have pissed 'em away, tho.

1/05/2009 9:26 AM  
Blogger I Travel for JOOLS said...

This comment has been removed by the author.

1/05/2009 9:27 AM  
Anonymous john galt said...

Madoff is definitely not me but you Dan are the personification of Eddie Willers.

If you had the intellectual capability to understand Atlas Shrugged I would debate you, but alas your analytical skills are sadly lacking.

Better for you to wallow in your own pseudo-intellectualizing and attempt to convince yourself that you're clever.

We're not laughing with you Dan.

1/05/2009 9:30 AM  
Anonymous Used to be a Libertarian, but couldn't stand the company said...

"the intellectual capability to understand Atlas Shrugged" = funniest phrase ever.

I mean, seriously, Atlas Shrugged is absolute trash. Clumsy writing, weak characters, and didactic on a shallow world-view.

There are some decent writings in favor of libertarianism, but none of them came from Rand's pen. She was a mediocre mind who makes small minds think they're stretching.

1/05/2009 11:14 AM  

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