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January 14, 2010

The New York Times gives Harold Ford, Jr. enough rope
Posted by Teresa at 02:43 PM * 79 comments

Allow me to recommend this NYT interview, in which one-time Tennessee congressman and would-be New York senatorial candidate Harold Ford Jr. reveals that he’s set foot in Staten Island once, when his helicopter landed there. He’s marginally familiar with one section of one subway line. He opposes Obama’s health care bill. He has a history of opposing gay marriage. He also has a history of supporting proposals to give local police the power to enforce immigration laws: a disastrous policy in a city where two-thirds of the residents are first- or second-generation immigrants.

His plan to encourage hiring is to slash corporate taxes and give employers a payroll tax holiday. He approves of the massive bonuses the bailed-out Wall Street banks paid a handful of their employees. And while it’s not surprising that he’s against capping executive compensation—it’s estimated that he’s getting paid at least a million a year—the rationale he gives is astounding:

“I am a capitalist,” he said. “I believe that people take risk, and there are rewards if they do well; they should lose if they don’t.”
Uh-huh. Risk takers. Rewards for doing well.

So read the interview already. It’s a work of art.

Suggestions for further fun: Glenn Greenwald blasts Ford’s privileged status, and his twisted notions of what constitutes capitalism. Campaign Diaries dissects Ford’s missteps and flip-flopping policies. Huffington Post characterizes the interview as “the New York Times basically allowed Ford to stage his own political autoerotic asphyxiation.” Politico dishes. Brooklynbadboy at Daily Kos takes his turn at the piñata. And Ford’s hoped-for opponent, incumbent NY Senator Kirsten Gillibrand, says “Bring it on.”

Comments on The New York Times gives Harold Ford, Jr. enough rope:
#1 ::: eric ::: (view all by) ::: January 14, 2010, 03:18 PM:

Wait. He's on an out of state driver's license? Does his insurance company know where he keeps the car?

#2 ::: abi ::: (view all by) ::: January 14, 2010, 03:23 PM:
"I am a capitalist,” he said. “I believe that people take risk, and there are rewards if they do well; they should lose if they don’t."

Those two sentences are mutually inconsistent. After all, what is a limited liability company (the very backbone of capitalism) but a means of limiting the losses of people who don't do well?

#3 ::: eric ::: (view all by) ::: January 14, 2010, 03:29 PM:

Yes. The risk/reward equation is fundamentally asymmetric, as bankruptcy limits the losses, but there's no corresponding limit on the upside. And with bailouts, the limit is even more skewed.

This leads to behavior where the median return is very nice, but there's a 5% chance of being wiped out, and you only need a couple of years of good returns to make bank and pass the problem on to someone else.

#4 ::: Christopher Davis ::: (view all by) ::: January 14, 2010, 03:40 PM:

eric (#3): OTOH, I think that the best thing that could happen for entrepreneurial capitalism in the US is the "socialism" of a single-payer health care system.

With that, more people would be willing to start small businesses of their own (or work for said small businesses) without worrying about health coverage for themselves or their family.

#5 ::: fidelio ::: (view all by) ::: January 14, 2010, 04:09 PM:

Harold Ford, Sr. built up an impressive political machine in Memphis, based on both his own abilities and his family's position in the community. It was able to thrive and prosper and even survive the connection to his brother John, who is able to take a place of pride (so to speak) in the Hall Of Amazingly Amazing Southern Politicians You Have to See to Believe*. Harold Sr. was able to pretty well turn over his congressional district to his son when he retired, and Harold Jr. did come amazingly close to winning the senatorial seat the egregious Bob Corker now graces. However, between the willingness of Corker to employ any tactics necesary (the Playboy ad, frex; please feel free to google it yourselves) and Uncle John and other members of the Ford family (there's Aunt Ophelia, too; we mustn't forget her) he didn't quite pull it off. Evidence that the Ford family influence in Memphis is waning can be seen by the fact that when Harold Jr.'s younger brother Jake ran as an independent in 2006 for the "family" house seat, trustng in the power of the name of Ford, he lost to Steve Cohen, who had represented parts of Memphis in the Tennessee legislature for many years, establishing a solid progressive record there.

I can see why Harold Jr. thinks he can do this; he came close in Tennesee, he's never seriously thought about what his family connections meant to him, because he could take them for granted, and after all, Hillary Clinton came in from Elsewhere and won New York's Senate seat, so clearly it can't be all that hard to sell yourself to New Yorkers.

Young Mr. Ford is such a creature of privilege that he really has no notion of how much he owes to that privilege and what he can claim from his own efforts. I wouldn't say that he's stupid or badly educated, but rather that he's the product of an immensely corrupt system (others who wish may speak out in greater detail about politics in the Southern US, and how the past is not just prequel, it's not even past, really). I think that his father kept his seat because more than likely he was able to deliver to his constituents what they wanted and needed, worked very hard to do so, and knew just how remarkable it was that he was in the right plce at the right time and able to take advantage of changing times. He's an intelligent man, and a politic one as well. I get a strong whiff of entitlement from most of the rest of the kinship, however, and somehow I don't think it's just me.


*Theodore Bilbo, where are you now?

#6 ::: cgeye ::: (view all by) ::: January 14, 2010, 04:14 PM:

I, for one, am incensed that his entry into the race gives Gillibrand political cover for being a reactionary right-of-center pol. Howcum Obama doesn't move the chess pieces, as he's doing with the CO governor's race?

Oh, waitaminnit. Maybe he *is*.

With Gillibrand's fool Blue-Doggish moves, she would have been vulnerable from a challenge from her left, but now Ford's bigfooting carpetbagging sucks all the air out of the room for any other candidate. All with no harm to Ford (his corporatist credentials are burnished, because when he loses he can go back dissing "those dirty Manhattan hippies" on FOX) or to Gillibrand (who gets that underdog status that helped Obama so). Ingenious, innit?

#7 ::: Matthew Daly ::: (view all by) ::: January 14, 2010, 04:15 PM:

I'm sure that there are states where Democrats would fairly consider a candidate who wants to be a check on Barack Obama's agenda, but I don't have any reason to believe that New York is one of those places. And I will have to doubt the sanity of anyone who believes Ford's line that he's going to be all mavericky for the average people of New York when his allegiances clearly lie with his fatcat banker friends.

I hope Ford can be dissuaded from running, because we would be ill-served by a mudslinging primary, and with our curious fusion laws there is a chance for third-party shenanigans that would feed Ford's ego to the detriment of the Democratic party (which, again, probably would suit Ford just fine). On the flip side, if there is a primary, then I can have the pleasure of voting for Kirsten Gillibrand twice.

#8 ::: eric ::: (view all by) ::: January 14, 2010, 04:37 PM:

Christopher Davis @4 - Yep. Total agreement.

#9 ::: wyrdling ::: (view all by) ::: January 14, 2010, 04:43 PM:

just FYI, New York is more than a city. and the more rural areas have different perspectives. Not that i think he has a chance there, either.

#10 ::: wyrdling ::: (view all by) ::: January 14, 2010, 04:47 PM:

just FYI, New York is more than a city. and the more rural areas have different perspectives. not that i think he has a chance there, either.

#11 ::: Teresa Nielsen Hayden ::: (view all by) ::: January 14, 2010, 05:24 PM:

I was cringing all the way through that interview. When he's asked about the outer boroughs, Ford says he's toured them by helicopter. His ground-level acquaintance is with one affluent strip of Midtown. He calls himself a Yankees fan because he's attended a few playoff games. He cites conversations with cabbies as one of his reasons to run, which is (a.) a cliché, and (b.) an odd thing for him to do, given his history of immigrant-negative policies. He does his best to gloss over the awkward fact that Harry Reid has been noticeably silent about his candidacy, and Chuck Schumer has tried to talk him out of running. He babbles emptily about "recent increased attention around national security issues" in a city whose interest in those issues is neither recent nor abstract. When he talks about becoming "more and more integrated into the city," he means he's participated in NYC's "philanthropic life" -- which is a sort of petting zoo for the rich and powerful. Moreover, the organizations he mentions are Prep for Prep, which rescues especially promising youth from the horrors of NYC by sending them to elite prep schools, and the Council on Foreign Relations, which has a branch in New York, but is not of it, and definitely is not about it.

How obvious can Harold Ford make it that for him, New York City consists of the rich, the powerful, and the preferred hangouts thereof?

This guy hails from an intensely political family. He went to expensive prep schools, an Ivy League university, and law school, failed his bar exam, and then at the age of 26 inherited his father's extremely safe congressional seat. The only reason he's out of office is that he tried unsuccessfully for one of Tennessee's seats in the Senate. He then became Chairman of the Democratic Leadership Council, a Fox News pundit, and a highly compensated vice chairman and senior policy officer at Bank of America Merrill Lynch.

In short, Harold Ford, Jr. is a reasonably intelligent but hardly brilliant guy whose entry-level job in politics was Congressman, entry-level job in media was Fox News pundit, and entry-level job in financial services is a million-a-year position as a vice chairman and senior policy adviser at Bank of America Merrill Lynch.

Sorry, but no. Our country is not supposed to have a hereditary aristocracy, and Ford's personal achievements are nothing to write home about. I got more than my fill of this nonsense during the Bush years.

#12 ::: Teresa Nielsen Hayden ::: (view all by) ::: January 14, 2010, 05:28 PM:

Wyrdling, the upstate communities' papers are free to concoct their own painfully revealing interviews.

#13 ::: Constance ::: (view all by) ::: January 14, 2010, 05:46 PM:

I sent the NYT link to the Spouse.

His response:

"i knew he was a dick, but i didn't know how much of a dick. he's really a dick."

Love, C.

#14 ::: Constance ::: (view all by) ::: January 14, 2010, 05:48 PM:

But I really, really dislike Kirsten Gillibrand also.

NY should be able to do better than either of the two without even trying very hard ....

Love, C.

#15 ::: Lee ::: (view all by) ::: January 14, 2010, 06:40 PM:

Christopher, #4: Hear, hear!

fidelio, #5: I see I wasn't the only one whose first thought was, "Oh, so he's trying to pull a Hillary Clinton. Good luck with that."

#16 ::: Matthew Daly ::: (view all by) ::: January 14, 2010, 06:49 PM:

What do folks not like about Gillibrand? She's been a dependable vote for the administration throughout her Senate career; evidently, being freed from representing a highly conservative district has been something that she has taken advantage of. She certainly wasn't enough of a "blue dog" to hold up the health care bill, and my understanding is that her gripe with it is that it didn't contain the public option like she wanted. I had my concerns at first when she was appointed, but there's been nothing there at all to dissatisfy me.

#17 ::: Michael Roberts ::: (view all by) ::: January 14, 2010, 06:51 PM:

Let me lend my support to Christopher #4 - in a rational world, somebody would be mentioning this in the media every day.

#18 ::: Nancy C. Mittens ::: (view all by) ::: January 14, 2010, 06:51 PM:

Hillary Clinton spent a year or two travelling around New York State, on a "listening tour." She met people, and found out about the rest of the state. She put some time and effort into learning about the place she wanted to represent.

This Ford guy? Has done nothing of the sort. And north of Westchester does not take kindly to the people who think NYC is the entirety of the state.

#19 ::: Marilee ::: (view all by) ::: January 14, 2010, 07:08 PM:

We had something similar for the Democratic primary for Governor. Terry McAuliffe has done a lot of work for Democrats and he lives in Virginia, but he's done nothing in Virginia, which is why he lost the primary.

#20 ::: John A Arkansawyer ::: (view all by) ::: January 14, 2010, 07:14 PM:

Anyone have a question for me to ask Harold Ford, Jr. in the next hour or two? He and Michael Steele are appearing on my campus. Why they didn't invite Bob Roberts for the trifecta, I'll never know.

#21 ::: Serge ::: (view all by) ::: January 14, 2010, 07:18 PM:

Nancy C Mittens @ 18... And Westchester itself has that Xavier and his school of freaks.

#22 ::: John A Arkansawyer ::: (view all by) ::: January 14, 2010, 07:21 PM:

Sorry--I jumped the gun. They'll be here February 4.

The offer is still open.

#23 ::: Xopher ::: (view all by) ::: January 14, 2010, 07:27 PM:

How about "What makes you think you know anything at all about New York, you toffee-nosed, blue-blooded git?"

Or "Are you planning to spend a year on an upstate listening tour before running, the way Mrs. Clinton did?"

#24 ::: fidelio ::: (view all by) ::: January 14, 2010, 07:30 PM:

Nancy C. Mittens @18--also, while Clinton did catch flack for "running on her husband", she did have a higher profile because of what she'd done, even if it was as an unelected specimen--and, as you said, she was willing to demonstrate an interest in the whole state, and not just the part with big checkbooks. She looked like a worker, too, which isn't something that comes to mind right off with young Mr. Ford.

Like a lot of political wives, she had learned to be as good a politician as her husband--while Harold Jr. has mostly learned to be a scion.

#25 ::: John A Arkansawyer ::: (view all by) ::: January 14, 2010, 07:42 PM:

Xopher @ 23: Not bad. My thought, addressed to them both, was, "Which of you is the bigger fool?"

#26 ::: Stephen Frug ::: (view all by) ::: January 14, 2010, 08:28 PM:

#6: I had the same thought. I don't think I really *believe* it, as I don't see what's in it for Ford, and he seems (admittedly on little evidence) to be too egocentric to run a sacrifice-fly campaign like that.

Still: since it's so weird to think about his running, there is temptation in the thought that he's a Gillibrand plant to make her look liberal and consistent by comparison. And he did give her $1000 last year.

#27 ::: Vicki ::: (view all by) ::: January 14, 2010, 10:11 PM:

Another thought: Clinton was running against Rick Lazio and/or Rudy Giuliani, both downstaters. If you're from Long Island, the difference between the Island and New York City can feel very large; I suspect they start to look pretty similar from Binghamton. Upstaters are more likely to think Gillibrand knows and sympathizes with them than they are to think that of a man who moved from Tennessee to Manhattan.

#28 ::: Lois Fundis ::: (view all by) ::: January 14, 2010, 11:41 PM:

Let me put it this way, from the perspective of the state where I live:

When Jay Rockefeller -- who had worked several years in our state as a VISTA volunteer (and some of the places he worked were very poor) -- decided to run for office here, he first was elected as Secretary of State, a relatively minor statewide office. Then he tried for governor, and *lost*. The feeling among many was that he had not yet proved he was a "real" West Virginian. (This happened 35 years ago, around the same time I moved here.) Did he go back to New York or wherever, as many people thought he might? No. He stuck around, took a job (as president of a local college, West Virginia Wesleyan, but a real private job in the state nonetheless), then having earned cred as a West Virginian simply for having stayed here, ran again for governor, and this time won. And won reelection, and only then, when after two terms as governor he was term-limited out of that job, did he run for Senator, and won. And won reelection again and again. And he's still, at age 72, our junior Senator. (I'm not sure but I'm willing to bet he's the oldest junior senator in the U.S. Senate, maybe ever.) And part of why he's been a champion of health care reform is because of what he's seen in West Virginia.

Questions to ask Harold Ford:
(a) Where is Rochester? Where is Elmira, or Olean, or Binghamton? (Insert other upstate places if you like.) Have you been to those places? Often? What are -- or were -- the major industries or employers there? What are some local issues there now, and what would you want to do to help them if you become a Senator?
(b) If you lose the election, will you stay in New York? If so, what will you do instead of being in politics? Will you stay in Manhattan or somewhere else in the state?

#29 ::: Avram ::: (view all by) ::: January 14, 2010, 11:59 PM:

TNH @11: He cites conversations with cabbies as one of his reasons to run

He must be angling for Thomas Friedman's endorsement.

#30 ::: Margaret Organ-Kean ::: (view all by) ::: January 15, 2010, 02:18 AM:

This guy is running for the Democratic nomination? Uh, why? Are we sure he doesn't have the parties confused? Because I think he does.

#31 ::: old ::: (view all by) ::: January 15, 2010, 04:11 AM:

Lois Fundis,

Another thing I will say for Rockefeller is that when I e-mail his office, he, or a staffer writes back. I don't always agree with the response, but he writes back.

I'm located in Morgantown? How about yourself?

#32 ::: Alex ::: (view all by) ::: January 15, 2010, 04:39 AM:

"I've not visited London as such...but I have viewed it from low earth orbit!"

#33 ::: Fragano Ledgister ::: (view all by) ::: January 15, 2010, 06:31 AM:

Isn't it a little late to be working so hard for Leona Helmsley's endorsement?

#34 ::: Scott ::: (view all by) ::: January 15, 2010, 07:17 AM:

Abi @3
Limited Liability Corporation isn't actually related to the fundamentals of capitalism.
The fundamentals of capitalism as best I know them are this (in no particular order):
1) Alienable rights to what one has, and what one does.
2) Monetary tokens are fungible.
With the assumption that: 3) Division of labor is good.

Corporations and the related laws are extension of capitalism specifically to encourage aggressive behaviors. Whether or not they're a good idea is not something I'm trying to tackle.

The fact that H. Ford doesn't believe in the losses is... hinted at in the OP, and I similarly believe that Mr. Ford is lying when he says he believes in Capitalism.

#35 ::: Shannon ::: (view all by) ::: January 15, 2010, 08:53 AM:

It certainly helps Gillibrand in the upstate areas that she's actually from there. She was born and raised in Albany, and originally represented the district weirdly surrounding Albany (Saratoga and much of the Hudson Valley), where I'm originally from. So yeah, she's guaranteed the upstate vote, especially against this guy.

#36 ::: Teresa Nielsen Hayden ::: (view all by) ::: January 15, 2010, 11:26 AM:

I have no faith that I know Gillibrand's personal opinions, but I'll settle for her voting in ways I approve of.

John Arkansawyer, ask him which subway lines have stops on 42nd Street.

#37 ::: Serge ::: (view all by) ::: January 15, 2010, 11:30 AM:

Teresa @ 36... which subway lines have stops on 42nd Street

There's one from Queens, if I remember correctly from my last being there in 1983.

#38 ::: Fragano Ledgister ::: (view all by) ::: January 15, 2010, 11:31 AM:

TNH #36: A real New Yorker would know which subway lines have stops on Dyckman Street.

#39 ::: Xopher ::: (view all by) ::: January 15, 2010, 12:37 PM:

If he hasn't already been asked subway, questions, ask him to give the next number in this sequence: 4, 14, 23, 34, 42, 59.

He gets a B for answering "125."

To get an A, he'd have to say "You mean during the day, or late at night?"

All other answers are an F.

#40 ::: David Dyer-Bennet ::: (view all by) ::: January 15, 2010, 01:27 PM:

I do think it's fair to say that the limited liability company is the backbone of capitalism. It makes it possible to construct enterprises of a size not really feasible as sole-proprietorships or partnerships (admittedly some VERY big enterprises have been done those two ways). ("Possible" in that no sane investor would buy 100 shares of stock in a company if doing so made him potentially liable civilly and criminally for anything the company did. A few people will invest in a partnership even with those risks because they'll be involved and somewhat in control, so the risk isn't as bad.)

#41 ::: Mark ::: (view all by) ::: January 15, 2010, 01:29 PM:

Bah. You want greater New York awareness, ask him what the fastest route is from Norwalk, CT to Scotch Plains, NJ. Let's see if he knows the world exists outside of Manhattan and the airports....

#42 ::: Chryss ::: (view all by) ::: January 15, 2010, 01:40 PM:

Anybody here think they're going to use this interview as part of lesson plans for Political Science classes for a few years?

#43 ::: Constance ::: (view all by) ::: January 15, 2010, 02:11 PM:

There's a lot more to NY than NYC and the subways.

I live in Manhattan and I often get lost in Brooklyn. Also, since the lines often discontinue in the midst of one's journey -- as just this past Sunday on our way to Fort Green -- and you are then to take a shuttle to next closest running line entrance, it can be very confusing for anyone. Especially if the weather's bad.

But there's so much more to know about this really big state than that! It's a great piece of geography, with wonderful resources, even yet.

Love, C.

#44 ::: Linkmeister ::: (view all by) ::: January 15, 2010, 02:21 PM:

David Dyer-Bennett @ #40, I have to disagree with your premise. The LLC is relatively new in the US, or at least its spread beyond state borders is.

In 1977, Wyoming became the first state to enact LLC legislation: it wanted to attract capital and created the statute specifically for a Texas oil company (W.S. 1977 § 17-15-101 et seq., Laws 1977, ch. 158 § 1). Florida followed with its own LLC statute in 1982 (West's F.S.A. § 608.401, Laws 1982, c. 82-177 § 2). At this point states had little incentive to form an LLC because it remained unclear whether the INTERNAL REVENUE SERVICE (IRS) would treat an LLC as a partnership or as a corporation for tax purposes.

In 1988, the IRS issued a ruling that an LLC in Wyoming would be treated as a partnership for tax purposes. This allowed the taxable profits and losses of an LLC to flow through to the LLC's individual owners; unlike a typical corporation, an LLC would not be taxed as a separate business organization. After the 1988 IRS ruling, nearly every state in the United States enacted an LLC statute, and the LLC now is a widely recognized business form. Many legal issues concerning the LLC are still developing, however.(My italics)
That's how I remember it. I don't remember seeing "LLC" as part of business entity names until after 1988.
#45 ::: Chris Quinones ::: (view all by) ::: January 15, 2010, 02:46 PM:

David @ 40, Linkmeister @ 44: Let's not confuse standard corporations, which have limited liability for their shareholders, and the Limited Liability Corporation (LLC), which is indeed a relatively recent innovation in the US. Here's an article which explains the distinctions pretty well (it's geared toward doctors, but other business entities can organize themselves in these varying ways; the firm I work for is an LLC, and they're in the IT business.)

I've heard it argued that the advent of the LLP can be blamed for some of the banking industry's bad behavior, because no longer can one investment banker's risky endeavors threaten to impoverish all the other bankers personally, but I don't know how true that is. I've heard the same about accounting firms.

#46 ::: David Dyer-Bennet ::: (view all by) ::: January 15, 2010, 02:50 PM:

I remember "limited liability corporation" being a phrase used in their relatively early years, and I was responding to that, not to this modern incarnation.

#47 ::: abi ::: (view all by) ::: January 15, 2010, 03:00 PM:

I was using "limited liability corporation" in the generic sense, as a corporation which limits the liability of its shareholders. I hadn't realized that the LLC was now a specific legal term as well as a generic.

#48 ::: Serge ::: (view all by) ::: January 15, 2010, 03:03 PM:

Gabey: "Hilde, do you know where we can hide?"
Brunhilde Esterhazy: "Sure, I know a place right across the Brooklyn bridge where they'll never find us."
Gabey: Where is it?
Brunhilde Esterhazy: "Brooklyn!"

#49 ::: Avram ::: (view all by) ::: January 15, 2010, 03:29 PM:

Scott @34, you seem to have confused capitalism with free markets. Which is a common failing, since capitalists spend a lot of money and effort making sure most people don't understand the difference between the two.

A free market is one in which individuals can freely choose what to do, what to buy, what to sell, how to contract with each other, and what to do with the profits (if any). In the real world, markets are free to varying degrees -- there will probably always, in any functioning society, be some contracts that the courts won't enforce, and some degree of taxation upon profits, and some goods and services illegal to sell or buy.

Capitalism is an economic system set up for the convenience of the owners of large accumulations of capital; this is why capitalism is called that, and not "marketism". While said owners may talk the free-markets talk, they pretty much inevitably walk the rent-seeking walk.

#50 ::: Earl Cooley III ::: (view all by) ::: January 15, 2010, 04:43 PM:

I support a 100% tax rate on undeserved income.

#51 ::: Lee ::: (view all by) ::: January 15, 2010, 05:29 PM:

Avram, #49: You forgot to mention that in the complete absence of regulation, any free-market system rapidly devolves into capitalism of the most cut-throat kind. Regulatory capture will yield much the same result, which is sort of where we are now.

#52 ::: Steve Downey ::: (view all by) ::: January 15, 2010, 06:23 PM:

Fragano@38
And will call them the IND and IRT.

#53 ::: Lois Fundis ::: (view all by) ::: January 15, 2010, 08:49 PM:

Old at #31 -- I'm in Weirton.

And Senator Byrd, or his office, also writes back. We have very polite Senators!

#54 ::: Chris Quinones ::: (view all by) ::: January 15, 2010, 11:24 PM:

David, 46: That's what I figured.

Abi, 47: Then I'm glad to have enlightened you! I'd have preferred they came up with a less generic name for the things, actually.

Fragano, 38, and Steve Downey, 52: All right, then: Which line stops at Seventh Avenue twice?

#55 ::: Scott ::: (view all by) ::: January 16, 2010, 12:29 AM:

David Dyer-Bennet @40
Why are you claiming that "big enterprises" are inherent to capitalism? A lot of people (myself SOMETIMES included) think that a lot of BAD comes from the rising size of the average enterprise in a lot of industries. Without the ability to limit criminal liability for stake-holders, stake-holders take a more active role in ensuring the good behavior of the businesses they are staked in. Without the ability to limit economic/bankruptcy liability, stake-holders are actually stake-holders! I don't see what's wrong with that. I still don't know that the finance sector is important for the proper creation and distribution of wealth. (Corporations don't work especially well without it.)
That said, I think corporations are a democratizing force in a capitalist system, making it EASIER for large numbers of smaller players to do things which could otherwise only be done by the very wealthy (or small groups of the very wealthy).

Avram @49
According to Merriam Webster:

an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market.

To my surprise, the definition includes mentions of corporations, but I suppose it shouldn't since that inclusion makes its definition of capitalism COMPATIBLE with corporations.
Saying that that system LEADS to (in your words) "the convenience of the owners of large accumulations of capital;" does not make it the definition.
The important difference between simple "free markets" and "capitalism" is (as Marxists put it) who controls the means of production. You can have free markets of socialized goods. When a bunch of people gather in a basement to trade gasoline ration vouchers for beef ration vouchers, you find market-clearing prices and all that invisible hand stuff. The capital goods are being controlled outside of that market though... making it not a capitalist situation.
I do, however, see that my definition was insufficient. I'd need to add something like a corollary to the bit about property rights something like:
1.5) Everything in the system has an owner. (including real estate) (there's a bit of fuzz here on whether things in a capitalist society are part of the capitalist system, for example national monuments, but what do you expect from a half-hour of writing?)

And I recognize that 1.5 isn't a gimme, that there's a lot of valid discussion about whether or not that should be true.

#56 ::: Avram ::: (view all by) ::: January 16, 2010, 01:05 AM:

Scott @55, funny thing, I was going to cite the Merriam-Webster definition in my post, since it mentions corporations, but I try to avoid citing generalist sources in technical discussions.

Saying that that system LEADS to (in your words) "the convenience of the owners of large accumulations of capital;" does not make it the definition.

If you're gonna quote my words, you should get them right. I didn't say that a capitalist system "leads to" the convenience of etc. I said that it is "set up for the convenience of" etc.

I think we're in rough agreement about the means of production. In a capitalist society, the means of production are controlled by capitalists -- people who own large amounts of capital.

We can see, in the music industry, a market trying to free itself from the power of capital. Digital computing put the means of production into the hands of people with small amounts of capital; large-scale, content-neutral computer networking put the means of distribution and advertising into those same hands. The big record labels (lots of capital) have moved to try and shut off those avenues of escape -- that's why they bribed Congress to cripple the "Internet radio" industry, and are trying to institute tiered pricing for Internet access, and come down hard on file sharing.

#57 ::: eric ::: (view all by) ::: January 16, 2010, 01:08 AM:

So, does the A train still get to Harlem in a Hurry?

#58 ::: eric ::: (view all by) ::: January 16, 2010, 01:10 AM:

So, does the A train still get to Harlem in a Hurry?

#59 ::: Scott ::: (view all by) ::: January 16, 2010, 02:30 AM:

Avram @56

I know you didn't say it leads to it. I placed the "(in your words)" where I meant it.

I was trying to extend what you DID say to something which I found more meaningful. You said something much LESS defensible, and less plausible. You are saying that the people who created capitalism did it for people who had the capital goods. People can't have the capital goods outside of a capitalist system. Chicken/egg problem?

...the means of production are controlled by capitalists -- people who own large amounts of capital. If "capitalist" is somebody who owns ANY capital goods, then your 3rd paragraph dovetails to my description of capitalism. If you restrict it to the owners of large amounts of capital goods, you're not describing an economic SYSTEM, you're describing an economic SITUATION.

Whether or not capitalism LEADS TO that situation is a complicated question. Things like availability of labor, sophistication of local technology, geographic distribution of capital goods, and assuredly tons of other factors will come into play.

Furthermore, telling me that the American (or worldwide) legal system has been gamed, such that there are laws and restrictions which favor the current holders of large quantities of capital goods, you'll find that I basically agree with you. But it's not PART of the capitalist system, much less definitionally. Capitalism doesn't imply republic (as the government style most vulnerable to public choice theory, and probably the second most vulnerable to outright purchasing, following plutocracy).

#60 ::: Avram ::: (view all by) ::: January 16, 2010, 03:23 AM:

Scott @59, the word "capitalism", in its modern sense describing an economic system, was coined by socialists, to describe a system they were criticizing. (There's an earlier sense meaning the condition of being a capitalist, but that's not what we're talking about here.) For much of the 20th century, capitalists deliberately engaged in a propaganda campaign to distort the meaning of the word. That's where you get nonsense about any system of free trade with strong property rights being a capitalist system.

Of course people can own capital goods outside of a capitalist system! The word "capital", in its current sense, dates back to medieval times. It's when those goods get concentrated into a few hands, and those hands distort the rest of the system in their favor, that you get capitalism. Definitionally, unless you use the definitions tainted by a century of propaganda.

#61 ::: Scott ::: (view all by) ::: January 16, 2010, 03:33 AM:

So, using words as they are used, is off limits in the discussion? Ahh, that's my station!

#62 ::: Avram ::: (view all by) ::: January 16, 2010, 04:27 PM:

Well, Scott, there's the thing: The original meaning of "capitalism", and the debased meaning, are both in play in modern America. For each, you can find a community of people using them. Both senses are "using words as they are used". I don't see any reason to prefer the propagandistic meaning over the honestly analytic one.

Note that I'm not saying the early socialists were right in all aspects of their analysis of capitalism. I'm just saying that they coined the word in a spirit of honest inquiry, while the debased meaning is the result, not of honest inquiry, but of dishonest propaganda.

#63 ::: Lenore Jones ::: (view all by) ::: January 16, 2010, 05:37 PM:

@45 Chris & 47 abi - Technical correction - LLC stands for Limited Liability Company, not Corporation. LLCs are taxed as partnerships in the U.S. tax system, but have limited liability for all partners. Hence they are a hybrid setup. When a professional firm (such as lawyers, accountants or doctors) uses an LLC, liability is not limited for malpractice, but it is for general business purposes. And for malpractice, it is limited to the partner at fault. (I am a CPA, but have been out of practice for years, and my memory may be imperfect. This is what I remember of this complex area.)

@39 Xopher - what stops at 23rd but not 50th?

#64 ::: Xopher ::: (view all by) ::: January 16, 2010, 07:18 PM:

Lenore - the A train, during the day.

#65 ::: Xopher ::: (view all by) ::: January 16, 2010, 07:19 PM:

Whoops, you're right. Not 23rd. D'oh!

#66 ::: Chris Quinones ::: (view all by) ::: January 16, 2010, 08:03 PM:

Lenore Jones, 63: You're right, my mistake. My firm has a number of employees who are not partners; if they injure a client in the course of their work, who bears the liability and to what extent? (The partners were looking to Omissions and Errors insurance for that very purpose, actually.)

#67 ::: Chris Quinones ::: (view all by) ::: January 16, 2010, 08:04 PM:

Looking INTO. Saw that just after hitting POST, dammit.

#68 ::: Vicki ::: (view all by) ::: January 16, 2010, 09:28 PM:

Eric--Depends where you're starting. From my house*, it doesn't take long to get to Harlem on the A. From Rockaway, it takes a while.

More seriously, yes, the A and D still zip from 59th Street/Columbus Circle to 125th Street with no stops between, when they're running normally, which is to say, the A doesn't get you there as fast late at night, or most weekends.

*To get to Harlem, I take the A downtown.

Xopher--

Thanks for correcting that sequence. I was trying to figure out which line you could mean there, since 23rd is local in every case (though I suppose you could nitpick 23rd-Ely, in Queens).

#69 ::: SamChevre ::: (view all by) ::: January 18, 2010, 11:20 AM:

On Harold Ford, Tiny Cat Pants had the best commentary. After his loss in the Tennessee Senate Race, she wrote this:

Every time there’s some kind of political scandal in this state some relative of Ford’s is caught up in it. His family is corrupt in a way they write Shakespearian dramas about.

#70 ::: Wyman Cooke ::: (view all by) ::: January 18, 2010, 11:41 AM:

Concerning the trains; is this going to turn into Mornington Crescent?

Concerning the Fords; Shakespeare? The Fords would have been fodder for William Faulkner.

#71 ::: Ginger ::: (view all by) ::: January 18, 2010, 12:45 PM:

Wyman @ 70: Concerning the trains; is this going to turn into Mornington Crescent?

I'll play! Pelham Parkway.

#72 ::: Ginger ::: (view all by) ::: January 18, 2010, 03:48 PM:

My earlier comment went into moderation -- I must have forgotten to close my html tag. Oh well, here goes again:

Wyman @ 70: ..is this going to turn into Mornington Crescent?

I'll play! Pelham Parkway, so chosen because my mom worked at AECOM for years. No, she drove; we lived in the suburbs.

#73 ::: Ginger ::: (view all by) ::: January 18, 2010, 03:50 PM:

Well, two tries and two comments held in moderation, with only one link -- the same one each time (NYC Subway map).

I'll play Mornington Crescent, the New York Version: Pelham Parkway!

#74 ::: hamletta ::: (view all by) ::: January 20, 2010, 03:35 AM:

Concerning the Fords; Shakespeare? The Fords would have been fodder for William Faulkner.

And in aught-six, I would have said Little Brother Whatsisname was the Idiot Man-Child.

Now I'm not so sure. That interview would make Marie Antoinette blush.

#75 ::: albatross ::: (view all by) ::: January 20, 2010, 11:07 AM:

Avram/Scott:

ISTM that Avram is using "capitalism" to describe a combined economic and political setup, while Scott is using it to describe mostly an economic setup. Both generally are going to involve private property rights and contracts and such enforced by governments.

I think a pure free market system (private property, contracts, rule of law) has a tendency, at least in most kinds of government we know how to build, to lead to capitalism in Avram's sense of that word.

Concentrations of wealth happen in a free market, because given a level of technology and a set of resources and constraints, different industries have different optimal sizes. When there's an industry that gets more efficient as it gets bigger (that's called "economies of scale"), over time the companies in that industry will tend to get pretty big. The owners of those companies will get a big concentration of wealth under their control. And in non-monstrous governments we know how to build, huge concentrations of wealth usually lead to similar concentrations of power--perhaps you spend a great deal of your personal wealth becoming mayor of New York, perhaps you bribe a bunch of congressmen, perhaps you buy or build newspapers to shape public opinion, perhaps you even spread money around in charities and building libraries and schools and stuff, but somehow, all that wealth helps you get influence with the folks making and enforcing the laws. Sometimes, this goes the other way--the powerful take over some of the businesses, either wholly or as a "partner" of some kind.

Now, that has two problems.

First, it undermines your free market, because the powerful business owners can use regulations to suppress competition or enforce cartels, use the police to break up labor unions, keep competing new technologies off the market, subsidize money-losing businesses, etc. That means you lose a lot of the benefits of a free market.

Second, it can undermine your political system. If people with great wealth become powerful enough, that's likely to undermine democracy. If the laws don't really apply to the rich and connected the way they do to the poor, you undermine the rule of law.

I suspect there's no way to entirely avoid these results of a free-market society, but they can be mitigated. I see this the same way I see the built-in problems with democracy--you don't abandon democracy because sometimes a demogogue will convince the people to burn all the witches, instead you build in some checks and balances, and accept that nothing is perfect.

The way it looks to me now (very different from how I saw things ten years ago) is that we're pretty far along this process right now. I'm not sure media concentration is the *most* important factor in the creepy and broken relationship between media and the powerful, but it's clearly *an* important factor. Regulatory agencies seem to routinely be making decisions that serve to protect established interests, rather than to do whatever they're supposed to do[1]. Subsidies, special exemptions from the normal rules, tax loopholes, etc., are just part of business in the US. Large parts of our economy are tangled together in networks of cross-subsidies and special rules that make it basically impossible to know whether the price of many things really reflects its underlying costs. (Is the stuff at Wal-Mart cheaper because they're using their market power to make better deals, or because they're using their political power to get local property tax breaks, or to fight off unionization? Probably both, which means it's not really possible to know how much of their low prices are because they're doing something useful, and how much is because they're dumping their costs somewhere else. This happens all over the place.)

I think Avram has the diagnosis mostly right here. In the US, there is a strong ideology of free markets. Both parties have absorbed a lot of this ideology. But they absorb it very selectively. When free market policies benefit the powerful and rich and connected, both Democrats and Republicans can be relied upon to talk about the importance of free markets, free trade, deregulation, low tariffs, etc. However, when the interests of the powerful, rich, and connected conflict with those things, then both parties somehow forget about those idealistic free-market types, and recognize the pragmatic necessity of a bit of helpful regulation, some protection from unfair competition, some subsidies, the odd bailout, etc.

The parties aren't identical. The Republicans use more free-market rhetoric, and have somewhat more free-market policies by default. But the differences in actual governance seem to me to be rather smaller than the differences in rhetoric, and neither party is in the habit of letting its rhetoric get in the way of protecting its major donors and supporters.


[1] See the Dept. of Agriculture's handling of food inspection/safety for ground meat, or for testing for BSE. See the FDA's "safe limits" on melamine in baby food, which somehow was zero until it turned out that some trace amounts of melamine were in US-produced baby food, when the limits were revised. Or the decisions to make some drugs (proton-pump inhibitors, H1- and H2-blockers) over-the-counter, which appear to have mainly been driven by the insurance industry's desire not to have to pay for them anymore. And on and on.

#76 ::: David Dyer-Bennet ::: (view all by) ::: January 20, 2010, 11:51 AM:

Scott@55: "Inherent" is your word, not mine. I was addressing one narrow issue -- the necessity of having a mechanism for doing very large projects. (Whether it's actually necessary could be discussed, I suppose.) A "backbone" (which WAS my word) is important, but so is a heart and a brain and for that matter kidneys.

I think we agree that lots of businesses grow well past the point where costs of being big exceed benefits of being big.

The finance sector limits the power of individual capitalists by providing other sources of investment (pooled funds from smaller capitalists including "ordinary" individuals).

#77 ::: Steve Downey ::: (view all by) ::: January 20, 2010, 06:15 PM:

Chris @ 54 - The 6th Avenue Express has two 7th Avenue stops.

Which line stops twice on 36th Street?

#78 ::: Nicholas ::: (view all by) ::: January 21, 2010, 12:31 AM:

Steve: The R, in Brooklyn and Queens.

#79 ::: John A Arkansawyer ::: (view all by) ::: February 04, 2010, 11:02 PM:

I went, and I return very, very depressed. I don't really want to revisit my notes just now.

I did leave with one factual question, to which I believe I know the answer, but I could be wrong: Was the TVA an essential element of providing running water to areas of the state of Tennessee?

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