Comments about ‘Letters: Subsidies and profits’

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Published: Monday, Sept. 23 2013 12:00 a.m. MDT

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Roland Kayser
Cottonwood Heights, UT

In our economy we privatize profits and socialize losses. Corporate America wins, taxpayers and consumers lose. Since half of all political "donations" come from the top 1/10th of the 1%, the people who fund our politicians are the winners. The other 99-9/10th of us are the losers.

Salt Lake City, UT

The writer asks: are subsidies to private enterprise a kind of backdoor socialism? I hope I understand his question. If I understand it, the answer would be no. Subsidies to private enterprise are nothing new. Such occurred during colonial times. Mainstream economics justifies them with externality arguments, i.e. the product or service being subsidized has a benefit to greater society which the manufacturer or provider cannot charge. This is a long standing argument in economics and is definitely not socialism.

I can tell you Marx had a very different view of profits. There isn't room her to get into that, but Marx asked a question as interesting as yours: in a system such as ours where transactions involve the exchange of things of equivalent value, where do profits come from?

The writer raises interesting issues.

Here, UT

The new "American Way". Take from the poor and give to the rich.

tranquility base, 00

So stop giving welfare checks to farmers and make employers pay a living wage.

All this can be done by bringing back unions.

Baron Scarpia
Logan, UT

I think we do a disservice to proclaim that America's economy is simply capitalist or socialist. Believing America is supposed to be totally capitalist, for example, encourages people to think of government programs in black-and-white terms (e.g., support for schools, bad. De-regulation good), and it biases people to not recognize how incentives and subsidies have benefitted America's economic prosperity.

The Internet, for example, was a government initiative, built and paid for by the government that in 1992, thanks to a bill sponsored by Senator Al Gore, congress allowed businesses to leverage for profit. Without the government's development of the Internet -- a massive subsidy -- Google and Facebook wouldn't exist today. Even the revival of Apple wouldn't have happened if Apple didn't pursue iTunes and leveraged the Internet for its music and entertainment businesses.

The same could be said of American government's construction of railroads, the national highway system, the Louisiana Purchase, or wars in the Middle East to protect 'our' oil sources (though this last subsidy may not be seen so positively).

Do subsides and incentives distort the market? Yes. And some distortions can often be good for America's economy.

Sandy, UT

The writer has stumbled upon the definition of "crony capitalism." It's a system where government, and not consumers, decide the economic winners. These winners then subsidize the political careers of the politicians who made them. It's a corruption of capitalism that too many confuse with real capitalism. This is what's destroying our economy, not "unfettered" capitalism. Nothing will revive our economy until crony capitalism (such as "too big to fail") is dismantled and replaced by a market system free of favoritism and subsidies. To do that, corrupt politicians will have to be sent packing. I don't see that happening anytime soon.

American Fork, UT

"If government contributes to the profit by subsidizing the costs through tax deals, wage supplements, or consumer incentives or in any other way, the government is taking money from the taxpayer to give to the business operation." This is called farming.

Moab, UT

There is a system that lies between capitalism and socialism, it is called fascism. Fascism destroys capitalism and leads to socialism. Obamacare is a great example of this process.

one old man
Ogden, UT

Mr. Neale, you nailed it.

That's the new American version of capitalistic socialism: Socialize the expenses; Privatize the Profits.

one vote
Salt Lake City, UT

The multi-national corporations have lots of profits and lost of cash. They operate in many countys that do have socialized medicine and still profit.

Sandy, UT

Geez KDave, you and I subsidize 60% of the nations healthcare now, don't you think we should ask those being subsidized to participate? You talk about individual responsibility. Until the ACA is fully implemented you won't know one way or the other how it will work but one thing is for sure, for the majority of Americans the previous system was unacceptable. Stand down and let democracy work, unlike your Congressman.

Sandy, UT

Unregulated Capitalism does not work. It cannot survive without competition. Competition cannot happen without free enterprise. Free enterprise is dead with monopolies. We have returned to gilded age. Where o where is Teddy?

Tyler D
Meridian, ID

@marxist – “Marx asked a question as interesting as yours: in a system such as ours where transactions involve the exchange of things of equivalent value, where do profits come from?”

They come from all the added entrepreneurial talents (e.g., vision, risk taking, management, business knowledge, coordination, etc…) that brings a product to market.
This is something Marx never understood (along with human nature in general) and is why like so many other “isms” he has some insights into half of reality (e.g., labor theory of value) but is as ignorant as a schoolboy regarding the other half.

And this is not to just pick on Marx – same is true (as one example from the other end of the spectrum) of someone like Ayn Rand and her Objectivism.

@KDave – “Fascism destroys capitalism and leads to socialism. Obamacare is a great example of this process.”

I think DN could post an article on the mating habits of dung beetles and someone would find a connection to, and reason to criticize, Obamacare.

Irony Guy
Bountiful, Utah

Exxon made $9 billion profit last quarter. The Republican House just voted them $4 billion subsidy. Why do Republicans feel the need to subsidize Exxon?

Mike Richards
South Jordan, Utah

Those with their hands out don't understand the concept of "risk". They want a guaranteed wage. They want the government to force "others" to buy the product of service that they provide. They want the government to "force" those who have taken a risk to give away their profits to those who will not take any risk.

In other words, they want FORCE to rule in their lives. Are they so ignorant of history that they don't know what happens when force becomes the governing factor? Have they no empathy for the millions of destroyed lives when government redistributed wealth to themselves, with a very small amount trickling down to the pawns who spilled their blood so that the dictators could rule and reign?

Take a long hard look at the many wealthy Democrats in Congress. How did they make their money? What did Harry Reid do to make his millions? What did any of them do? They passed laws that made them rich and then they have the gall to point their finger at those who actually took risk to make a profit.

Shame on the freeloaders who covet the wealth of the risktakers.

LDS Liberal
Farmington, UT

Conservative will whine all day long about people welfare,
let them starve, let them die,
will fight tooth and nail for Corporate Welfare.

When Republicans promote "Free Market Capitalism" by taking away Corporate Welfare and special tax incentives --

the vast Military Industrial Complex,
the Oil industry,
Pharmaceutical and Healthcare Insurance companies,
America's Farmers,
Food Stamps for minimum wage workers and let the WalMart and FastFood Billionaires run their own stores without them,

Let them compete on a free market, unbiased, and may the best product for the best price win...

Until then --
Republicans are the biggest Corporate "Socialists" on the planet.

Deep Space 9, Ut

To "SEY" the term croney-capitalism is just a distraction. You should call it what it truely is. Fascism. Remember that the government doesn't give people money without attaching strings to it. The government then can use those strings to control your business. Just look at the banking and health insurance industry. They are being controlled by socialist leaning policies, but are still privately owned, that makes those industries fall under a fascist control.

To "ugottabkidn" there is no such thing as "unregulated capitalism", that would be anarchy. Capitalism requires that there is a government entity to enforce regulations, contracts, and property rights. Government should not be involved with ensuring a business remain open.

To "LDS Liberal" we should go back to a capitalist sytem. As U2's Bono recently pointed out. Capitalism is a highly effective way of helping poor people climb out of poverty. Socialism doesn't work. As Brigham Young said, socialism will just turn people into beggars asking others to give them food. That is what your ilk have turned corporate America into, beggars asking for government handouts. If you want to know why, it is because liberals/progressives give government money to their cronies.

Tyler D
Meridian, ID

@Mike Richards – “Take a long hard look at the many wealthy Democrats in Congress. How did they make their money? They passed laws that made them rich…”

@Redshirt1701 – “That is what your ilk have turned corporate America into, beggars asking for government handouts.”

What country are you guys living in? If you’re going to bash Democrats at least do it for the right reasons (giving away free stuff to the little guy).

For what you two are talking about we need look no farther than the Elephant Party. Republicans are THE party of corporate welfare and crony capitalism. Does anyone not remember the no-bid Halliburton contracts?

And if that’s too far in the past (perhaps you think now with Tea Partiers in charge things are different) all we have to do is look at the 2013 Farm Bill. If that is not giant farming conglomerates and corporate food companies getting billions of dollars of “free stuff” from the government, not to mention legal protection for wrong doing (hello Monsanto), I don’t know what is.

Deep Space 9, Ut

To "Tyler D" you need to look beyond the political parties. The Democrats are just as guilty as Republicans are for marching us towards socialism. The Democrats and Republicans that are doing this to us are all Progressives, and the only difference between the two is the rate of travel.

As far as the Democrats are go, you forget Solindra, GM, GE, and other companies that get free money from the government just because somebody is either well connected or because a politician is afraid of what happens if a company closes shop.

The Tea Party Republicans are not in charge of much of anything. They are slowly growing in numbers, but they have to fight the Progressive R&Ds. If you look at the 2013 farm bill, the Tea Party was opposing it or thowing ammendments into it that the establishment hated.

The question is do you want to continue the march towards socialism or do you want freedom?

Tyler D
Meridian, ID

@Redshirt1701 – “The question is do you want to continue the march towards socialism or do you want freedom?”

I try not to get hung up on labels, especially single word ones so vague & loaded they are virtually meaningless.

I would like to live in a country where the game is not rigged in anyone’s favor – a meritocracy where everyone has an equal shot. But I also want to live in a country where we are not blinded to the fact that many people don’t start out on equal footing and one that has enough compassion to try and help those (e.g., education) with no-fault-of-their-own disadvantages.

Conversely, there are too many people in this country who are “born on third” and then think through their own brilliance & hard work, they hit a triple (and ridicule those are not standing on third base).

I want to live in a country that that protects our environment and promotes fair justice and protection from the worst of human nature (which is often the most pernicious in the amoral corporate setting).

What kind of country is that?

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