Every government, from the Obama administration right through to Angela Merkel, the Eurozone and the IMF, promise to save the banks, not the economy.
When you say "paying the banks," what they really mean is paying the bank bondholders. They are basically the One Percent.
To save the banks from making losses that would wipe out their net worth, you'll have to get rid of Social Security. It means that you'll essentially have to abolish government and turn it over to the banking system to run, with an idea that the role of governments is to extract income from the economy to pay to the bondholders and the banks.
To save the banks, you would have to turn the entire Eurozone into Greece.
What's the best gamble in the world, right now? Its betting that Deutsche Bank stock is going to go down. Short sellers borrowed money from their banks to place bets that Deutsche Bank stock is going to go down. Now, it's wringing its hands and saying, "Oh the speculators are killing us." But it's Deutsche Bank and the other banks that are providing the money to the speculators to bet on credit.
Most banks - with Deutsche Bank at the top of the spectrum here - have decided that they can't make money lending to barrowers anymore, so they're going to the second business plan: They lend money to casino capitalists. That is, to people who want to gamble on derivatives.
On the flat tax, the more you compress the tax rates, the more you untax where the income is really made, at the top of the pyramid.
Trump's junk economics is the illusion that if we cut the taxes on the wealthiest brackets, it'll all trickle down. But it doesn't trickle down.
One basic myth is that rich people get wealthy by earning income. But that's not how most get rich. Most of the gains of the rich people since 1945 have been "capital gains".
Europe is sort of like the Soviet Union in the '30s and '40s. There was an argument, is it reformable or not? There is a feeling, and I think it's correct, that the European Union, the eurozone, and the euro, is not reformable, as a result of the Lisbon treaties and the other treaties that have created the euro. Europe has to be taken apart in order to be put together not on a right-wing, neoliberal basis, but on a more social basis.
The concept of productivity in America is income divided by labor. So if you're Goldman Sachs and you pay yourself $20 million a year in salary and bonuses, you're considered to have added $20 million to GDP, and that's enormously productive. So we're talking in a tautology. We're talking with circular reasoning here.
The establishment Trump talked about wasn’t really Wall Street. He said, “When Washington got rich.” Bernie Sanders would have said, “When Wall Street got rich, the country didn’t.” So I think when Donald Trump says "Washington," what he means is the government regulatory agencies.
America needs an ineffective president. That's much better than an effective president that's going to go to war with Russia, that's going to push for the Trans-Pacific Partnership, that's going to protect Wall Street, and that's going to oppose neoliberal austerity. I would much rather have an ineffective president than someone who's going to do these bad things that I fear is going to come from Hillary and the Democratic Party.
Trump has said that he wants to remove the tax deductibility of interest. If he can do that, fine. But I hope that Trump knows that it's not the President that sets tax policy. It's Congress.
Textbooks don't teach people how to avoid paying any income tax. But that's what an army of tax lawyers and corporate tax accountants do.
That's why Apple, Microsoft and the big information technology companies have kept so much money registered abroad (although in US dollar accounts with a nominal foreign address's owner). They pretend to make their global income in Ireland. They have an office, which could be simply a postal drop box in Ireland, and claim to make all their money there, not in America.
That's the "magic" of double-taxation treaties: you can shop around for the lowest taxer.
Normally, if someone goes bankrupt, you wipe out the debt and get a fresh start. But that's not permitted with student loans. So the effect is to impoverish many graduates with very high debts.
Now, suppose that a homeowner puts down only 3% of their own money or 3.5% for the FHA. That means if prices go down by only 3%, the house will be in negative equity and it would pay the homeowner just to walk away and say, "The house now is worth less than the mortgage I owe. I think I'm just going to move out and buy a cheaper house." So it's very risky when you have only a 3% or 3.5% equity for the loan. The bank really isn't left with much cushion as collateral.
