I tried to think up a comment on this, but, really, it speaks eloquently for itself.
ROME, Jan 10 (Reuters) – Organised crime has tightened its grip on the Italian economy during the economic crisis, making the Mafia the country’s biggest “bank” and squeezing the life out of thousands of small firms, according to a report on Tuesday.
Extortionate lending by criminal groups had become a “national emergency”, said the report by anti-crime group SOS Impresa.
Organised crime now generated annual turnover of about 140 billion euros ($178.89 billion) and profits of more than 100 billion euros, it added.
“With 65 billion euros in liquidity, the Mafia is Italy’s number one bank,” said a statement from the group, which was set up in Palermo a decade ago to oppose extortion rackets against small business.
…
Old style gangsters handing out cash in bars and pool halls had been replaced by apparently respectable bankers, lawyers or notaries, the report said.
“This is extortion with a clean face,” it added. “Through their professions, they know the mechanisms of the legal credit market and they often know the financial position of their victims perfectly.”
For some time I’ve hewed to Cszlew Milosz’s characterization of America as “a moderately corrupt republic.” Now I would argue for a shorter tag, plutocracy. One of the consequences of governance by the rich (via their agents, Congress) is spelled out in “How the McEconomy Bombed the American Worker: The Hollowing Out of the Middle Class” by Andy Kroll in Tomdispatch.com. The attention grabbing opening paragraph:
Think of it as a parable for these grim economic times. On April 19th, McDonald’s launched its first-ever national hiring day, signing up 62,000 new workers at stores throughout the country. For some context, that’s more jobs created by one company in a single day than the net job creation of the entire U.S. economy in 2009. And if that boggles the mind, consider how many workers applied to local McDonald’s franchises that day and left empty-handed: 938,000 of them. With a 6.2% acceptance rate in its spring hiring blitz, McDonald’s was more selective than the Princeton, Stanford, or Yale University admission offices.
The article gives an account of rise of the McEconomy. Read it here.
A tale of the 1% or, more accurately, the 1% of 1%. Not much to be said here. The story of Russian billionaire Yuri Milner’s Silicon Valley “foot on the ground” is making the media rounds. One wonders how much is enough. I am fond of Epicurus’s take: ‘Nothing is enough for the man to whom enough is too little.’ More photos where this one is from: Business Insider.
One of the problems with greed is that it knows no bounds. In 1985 the top 1% of the Americans received 12% of the income and controlled 33% of the wealth. Now the figures are 25% and 40%. respectively. This is not a good thing…and not only from a notion of fairness. It’s a bad thing, also, because of what happens to nations when the distribution of wealth is so skewed.
The more divided a society becomes in terms of wealth, the more reluctant the wealthy become to spend money on common needs. The rich don’t need to rely on government for parks or education or medical care or personal security—they can buy all these things for themselves. In the process, they become more distant from ordinary people, losing whatever empathy they may once have had. They also worry about strong government—one that could use its powers to adjust the balance, take some of their wealth, and invest it for the common good. The top 1 percent may complain about the kind of government we have in America, but in truth they like it just fine: too gridlocked to re-distribute, too divided to do anything but lower taxes.
Ok, you can steal my e-books. Well, it’s not actually stealing, because if you don’t want to pay for one, you can have it. So goes Tim O’Reilly’s approach to digital rights management (DRM). This, of course stands directly opposite the rigidly proprietary copyright practices of major media publishers. But O’Reilly runs a $100 million media business. What gives? Is he a throwback to the 60′? (Shades of Abbie Hoffman and Steal This Book.) Or do we see an early adopter of an approach to publishing and copyright management that puts more emphasis on the good to the community? And one which, of course, is also economically viable.
From “Steal This E-Book” by Jon Bruner in Forbes Focus, an abridged interview with Tim O’Reilly. The unabridged version (and worth the read) is here.
Jon Bruner: On all your titles you’ve dropped digital-rights management (DRM), which limits file sharing and copying. Aren’t you worried about piracy?
Tim O’Reilly:No. And so what? Let’s say my goal is to sell 10,000 copies of something. And let’s say that if by putting DRM in it I sell 10,000 copies and I make my money, and if by having no DRM 100,000 copies go into circulation and I still sell 10,000 copies. Which of those is the better outcome? I think having 100,000 in circulation and selling 10,000 is way better than having just the 10,000 that are paid for and nobody else benefits.
People who don’t pay you generally wouldn’t have paid you anyway. We’re delighted when people who can’t afford our books don’t pay us for them, if they go out and do something useful with that information.
I think having faith in that basic logic of the market is important. Besides, DRM interferes with the user experience. It makes it much harder to have people adopt your product.
Reliable political bellwether of white American middle-class sensibilities, Chuck Schumer, Senator from New York, has joined the ever growing chorus in the call for equal marriage rights for same sex couples, i.e., gay marriage. His protegé, junior New York Senator Kristen Gillibrand, joined him in climbing aboard the history train. The unfolding of an inevitable continues. Raw Story brings us the news here.
Yves Smith contends that from a policy standpoint, it’s the latter. The graph below, showing real vs. nominal growth providing evidence for her claim. Via Naked Capitalism. Originally at VisualizingEconomics where the focus is on investment value of home ownership rather than social/economic policy:
A $10,000 house in 1890 would be worth almost the same in real dollars in 2010 but more than $350,000 in nominal dollars in 2010. Which matters to the home seller, real or nominal prices? If a seller is holding a mortgage then the question is: Can I sell for more or less than I owe? Since that loan amount is not adjusted for inflation then the nominal value is more important both the seller and the mortgage holder. It is when nominal prices fall that banks have trouble with high rates of mortgage defaults. But if you are looking at the long-term value of real estate as an investment (compared to stocks or bonds) then you need to take into account the real growth.
Lady Gaga bares, if not all, then much of her life in front of a room full of Googlers. Candid, engaging, appreciative of her fans…and clearly too hip for the room including the interviewer, Google’s Marissa Mayer who can’t quite be herself in the presence of our current incarnation of fame. But Stefani (she and Gaga are one, we learn) clearly loves her fans who adore her – no matter that her “life as art” riffs land outside the algorithms of Google’s culture. If art anticipates the future, what does the phenomenon of the Lady Gaga foretell?
This is my last post in the Zeit Guy Chronicles blog. I’ve been focusing on the work at “born of silence” and will continue that. The current content of this site will be archived at richardfarrell.wordpress.com. This domain, richardfarrell.com, will be the new site for the born of silence content. To confound things even more, that site will be renamed to “Drifting Awake.”
So starting later this evening, the gods of technology willing, these three URLS will take you to the same site –
I post much different material there, and I don’t want to send you unasked for email. So if you want to be notified of the new work, I invite you to register anew. You can do that starting tomorrow morning.
Arianna Huffington’s success with her Huffington Post blog evidently has inspired Tina Brown to create a blog of her own, The Daily Beast. Brown’s site is also an aggregator, but one that comes from the sensibility she displayed when she was editor of the New Yorker. I find that her bloggers are more interesting than the legions of folks who write for the Huffington Post. Arianna gets points for comprehensiveness, but the style points go to Tina.
Two examples: Stanley Crouch on The Hip-Hop Inauguration, refreshingly politically incorrect commentary on hip-hop culture. The other is by Alexandra Penney who lost her life’s savings and income stream to the last (I hope) great icon of the Age of Greed, Bernie Madoff. She is now writing The Bag Lady Papers – a confessional grounded in the next great boomer fear: Oh my God, I’m going to outlive my money. Good stuff, the writing that is.
Annals of Greed: The Ever Fattening of the 1%
One of the problems with greed is that it knows no bounds. In 1985 the top 1% of the Americans received 12% of the income and controlled 33% of the wealth. Now the figures are 25% and 40%. respectively. This is not a good thing…and not only from a notion of fairness. It’s a bad thing, also, because of what happens to nations when the distribution of wealth is so skewed.
Such is the warning that Joseph Stiglitz brings us in his article, “Of the 1%, by the 1%, for the 1%,” in the current issue of Vanity Fair. One of several money quotes in a money article:
And the consequences?read more »
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