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Who: Kimball Corson. Text and Photos not disclaimed or that are obviously not mine are copyright (c) Kimball Corson 2004-2013
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A Sense of Duty Emerges
Kimball Corson
07/26/2015, Pago Pago, American Samoa

I have long argued courts should imply a duty of loyalty to the public interest, if not a watered down fiduciary duty, for congressmen and women acting in their representative capacities as elected legislators. Presently, we have representation devoid of any duty or obligation to those represented. Lawyers should find that to be a laughable The suggestion is, of course, an end run on campaign finance reform and several Supreme Court rulings.

Now something analogous crops up.

The Obama administration estimates that Americans lose $17 billion a year to investment professionals who manage retirement accounts by putting their own financial interests over and above those of their clients. The administration has proposed a simple solution: make that illegal. In other words, a duty of loyalty to the client's interest exclusively is to control and be the standard for investment representatives.

Congressional Republicans loathe the rule, of course. but Elizabeth Warren's neat inviseration of Primerica President Peter Schneider, who Senate Republicans had invited to testify against the new regulation designed to protect retirement savings from lecherous investment professionals, underscores their difficulties in arguing against the rule. Warren made it clear why the rule is needed. The GOP can usually rely on a nearly united financial industry front against Democratic regulatory proposals. But not now.

This time some big-name investment professionals actually have come out in support of the rule, recognizing that it will purge the industry of bad actors and create business opportunities for those who don't rip off their own clients.

Now, if the same kind of attention would be turned to our elected representatives or congressmen themselves . .

Reception of Hillary's Economic Speech Is Tepid at Best
Kimball Corson
07/26/2015, Pago Pago, American Samoa

HuffPo's views are typical. Politico's byline reads, "The Democratic front-runner manages to underwhelm both Wall Street and its reformers in her signature economic policy speech." The title of the Washington Examiner's review article was "17 ways Hillary's big economic speech rehashed Obama." and "The hard questions that Hillary's speech on the economy left out " was the Washington Post's article title.

The New Yorker's article was entitled "The Word Hillary Clinton Didn't Say" which was redistribution. Hillary's campaign website somewhat dishonestly tried to put a positive spin on on her speech by quoting other reviewers out of context or saying nothing about what they said.

What must be kept in mind at all times about Hillary is she and Bill love money and three of Clinton's top four campaign donors, in the course of her career, are Citigroup, Goldman Sachs, and JPMorgan Chase. Don't forget that.

Much now points to Hillary as a "Republican Lite" in sheep's clothing. She is simply not to be believed.

Hillary's Reputation for Honesty Sucks
Kimball Corson
07/26/2015, Pago Pago, American Samoa

According to recent polls -->

Colorado voters say 62 - 34 percent that Hillary Clinton is not honest and trustworthy and 57 - 39 percent that she does not care about their needs and problems.

Iowa voters say 59 - 33 percent that Hillary Clinton is not honest and trustworthy,

Virginia voters say 55 - 39 percent that Hillary Clinton is not honest and trustworthy.

Seems Hillary has an honesty problem is not much thought to be trustworthy. Voters in those states also said they thought that Clinton's trust issues will be a key factor in 2016. Hillary Clinton's numbers have dropped among voters in the key swing states of Colorado, Iowa and Virginia, while those of Bernie Sanders have risen.

Hillary "has lost ground in the horserace, and on key questions about her honesty and leadership," said Peter A. Brown, assistant director of the Quinnipiac University Poll. While Hillary has excellent name recognition, how does that help when The New York Times and Washington Post are focused on her email problems and on her questionable foreign and Wall Street campaign donors?

Why am I not shocked?

The Fundamental Change in the US for the Modern Era
Kimball Corson
07/26/2015, Pago Pago, American Samoa

In times past, when there was a problem with an unfair law or practice, it was addressed. Sometimes slowly. Sometimes not too aptly. Sometimes with messy consequences. But it was addressed, mostly by governmental action. Our federal government, acting on the wishes of usually a majority, stepped into the breach to correct the problem and right the wrong or at least tried to. That has all changed now. Government, as a moral arbitrator, is dead.

There is no moral arbitrator any longer, no mediator, no recourse. Courts look the other way and tend, as Posner explains, to rubber stamp government. Congress has sold out to monied interests who line their personal and campaign coffers. Corruption is king. Hope sinks. Despair sets in. Anxiety rises. We are bewildered and overwhelmed. Our money-corrupted institutions and government trail along in the financial slip stream created by the Oligarchs who control our world and economy. Our sense is properly one of helplessness. There is no God or hope or right or wrong. It is a sea of political forces greased with cash. Too little else matters. Things did not use to be this way. What we have is a new, primitive social order, centered on the idea that money, not physical might, makes right.

What we observe presently is new: it is politicians in numbers standing up and pushing for laws and changes, also in number, what they can only know are wrong, unfair and inequitable -- and doing it frequently. This is wholly new. The attending sense of no shame is also new. We have not really seen this earlier in our history. It is a break through. A new paradigm. It has consequences beyond the laws and changes the Oligarchs want and get.

Public political discourse has vanished. Exchanges and our media deal with canned positions. Blocks for and against align and oppose, often tracking the money paid to them for what they actually do.. It is a bought system. Appeasement language is occasionally heard, but it is of no consequence. Hillary's economic speech is a perfect example.This failure and the irrelevance of discourse is likewise new. Big adverse changes are forced on the public. All this is new, but especially the shameless advocacy by many for what is patently wrong and unfair on its face.

We are a ship whose rudder is money heading toward the isle of a new nation where what rights, privileges and compensation we are accorded will be decided by the oligarchs. The analogy of penned cattle comes to mind. And we are letting it happen to ourselves -- the wishes of Islam notwithstanding. Countervailing forces are too weak to remedy the situation. We are locked in, herded and controlled and our rhetoric is scattered and dispersed.

A Start Toward Reforming the US Economy in Favor of the Majority
Kimball Corson
07/26/2015, Pago Pago, American Samoa

Elizabeth Warren and Joseph Stiglitz, leading a serious group of American progressive economists, have studied the reforms to the American economic system they think are necessary to make our economy more fair and equitable to average or typical Americans, instead of rigged to favor the oligarchs. I agree with their list but think it could be more detailed and comprehensive. However, it is a good start.

What follows are the 37 specific laws and policy changes of the Warren- Stiglitz group to restore some fairness and balance to the economy without undermining American capitalism. The short hand designation is the Roosevelt Institute's report.

Fix the Financial Sector

1. End "too big to fail" by imposing additional capital surcharges on systemically risky financial institutions and breaking up firms that cannot produce credible living wills.

2. Better regulate the shadow banking sector.

3. Bring greater transparency to all financial markets by requiring all alternative asset managers to publicly disclose holdings, returns and fee structures.

4. Reduce credit and debit card fees through improved regulation of card providers and enhanced competition.

5. Enforce existing rules with stricter penalties for companies and corporate officials who break the law.

6. Reform Federal Reserve governance to reduce conflicts of interest and institute more open and accountable elections.

Incentivize Long-Term Business Growth

7. Restructure CEO pay by closing the performance-pay tax loophole and increasing transparency on the size of compensation packages relative to performance and median worker pay and on the dilution as a result of grants of stock options.

8. Enact a financial transaction tax to reduce short-term trading and encourage more productive long-term investment.

9. Empower long-term stakeholders through the tax code, the use of so-called "loyalty shares," and greater accountability for managers of retirement funds.

Make Markets Competitive

10. Restore balance to intellectual property rights to encourage innovation and entrepreneurship.

11. Restore balance to global trade agreements by ensuring investor protections are not prioritized above protections on the environment and labor, and increasing transparency in the negotiation process.

12. Provide healthcare cost controls by allowing government bargaining.

13. Expand a variant of Chapter 11 bankruptcy to homeowners and student borrowers.

Rebalance the Tax System

14. Raise the top marginal rate by converting all reductions to tax credits and limiting the use of credits.

15. Raise taxes on capital gains and dividends.

16. Encourage U.S. investment by taxing corporations on global income.

17. Tax undesirable behavior such as short-term trading or polluting and eliminate corporate welfare and other tax expenditures that foster inefficiency and inequality.

Make Full Employment the Goal

18. Reform monetary policy to give higher priority to full employment.

19. Reinvigorate public investment to lay the foundation for long-term economic performance and job growth.

20. Invest in large-scale infrastructure renovation: a 10-year campaign to make the U.S. a world leader in innovation, manufacturing and jobs.

21. Expand public transportation to promote equal access to jobs and opportunity.

Empower Workers

22. Strengthen the right to bargain by easing legal barriers to unionization, imposing stricter penalties on illegal anti-union intimidation tactics, and amending laws to reflect the changing workplace.

23. Have government set the standards by attaching strong pro-worker stipulations to its contracts and development subsidies.

24. Increase funding for enforcement and raise penalties for violating labor standards.

25. Raise the nationwide minimum wage and increase the salary threshold for overtime pay.

Expand Access to Labor Markets and Opportunities for Advancement

26. Reform the criminal justice system to reduce incarceration rates and related financial burdens for the poor.

27. Reform immigration law to provide a pathway to citizenship for undocumented workers.

28. Legislate universal paid sick and family leave.

29. Subsidize child care to benefit children and improve women's workforce participation.

30. Promote pay equity and eliminate legal obstacles that prevent employees from sharing salary information.

31. Protect women's access to reproductive health services.

Expand Economic Security and Opportunity

32. Invest in young children through child benefits, early education and universal pre-K.

33. Increase access to higher education by reforming tuition financing, restoring protections to student loans, and adopting universal income-based repayment.

34. Make healthcare affordable and universal by opening Medicare to all.

35. Expand access to banking services through a postal savings bank.

36. Create a public option for the supply of mortgages.

37. Expand Social Security with a supplemental public investment program modeled on private Individual Retirement Accounts, and raise the payroll cap to increase revenue.

These reforms would go a long way toward improving our economy and correcting the regards in which the oligarchs have rigged the economy against us with the bought complicity of the US congress. I think the list could be expanded in ways I have suggested and Bernie Sanders has, too. Things don't have to be unconscionable or the way they are. For cash, congress has abdicated its representative role and it needs to return to being a defender of what serves Americans best. It is no wonder its approval rating is now in the toilet.

Americans Have Been Distracted and Had by the Oligarchs
Kimball Corson
07/26/2015, Pago Pago, American Samoa

Liberals are pleased with developments on social issues. Even the conservative Catholic majority on the Court has somewhat seen the light. But there is a major rub here. By means of this mock battle, which conservatives have used to stir and inflame their red state electoral base, they and the oligarchical interests they represent have pulled a fast one.

Social issues became strongly politicized and fought by conservatives as a smoke screen to distract Americans from the agenda of the oligarchs they represent to rig the economy massively in favor of their own capital based profits and against the majority. The smoke screen has been a huge success and of course includes the republican parade of fools and their comments as they run for one or another office. Winning is not the issue. Distraction is. Conservatives have backed off a bit recently and allowed liberals and progressives some social wins now that the economy is so largely and well rigged in favor of the oligarchs. Warren and Stiglitz point out some but not all of that rigging.

By means of the rigging, profits have remained high for an incredibly long time. The means used to rig include: Blocking a hike in the minimum wage, bank frauds and abuses, blocking the refinancing of student loans, changes to the bankruptcy laws to favor creditors, blocking new over time rules, union busting, rigging the tax code, to include reduced top marginal income tax rates, fighting efforts for more equitable compensation so CEO's and their ilk don't rob the store, blocking a financial transaction tax for Wall Street, gutting the antitrust laws, seeking horizontal mergers, blocking trade agreement reforms and pushing for larger abuses, blocking reforms to our intellectual property laws, blocking health care and ins programs while hustling for special exemptions, legislations and CFR's to seurer reforms, blocking tax hikes on unearned income and capital gains, blocking infrastructure and public transportation reforms, blocking expansion of the social safety net, Medicare and Social Security and affirmatively trying to gut those programs, and generally applying a wreaking ball to government ro serve their own financial interests. These are among the obvious and overt means used to rig economic matters, but more is largely involved as well.

Slackened competition and demand have eased commodity prices worldwide thereby raising profits as has the continued off shoring and, now more importantly, the partial off shoring of American jobs by using parts manufactured abroad. Robotics makes ever greater in roads and increases profits and capital returns at the expense of displaced labor. Emerging third world middle class markets somewhat sustain demand for corporate America in the face of a) growing income inequality in the US, b) more and profitable monopoly practices here and c) huge economies of scale, especially from horizontal consolidation in the US as the antitrust laws lie largely dead or dormant.

The American middle class has been gutted by the oligarchs, who have looted and taken advantage at every turn, while we worried about the rights of gays, teaching religion in our schools, racial tensions and other less important social issues.. Without major economic reforms --which are hard to imagine in this political climate and without campaign fiance reform -- most Americans stand no real chance.The direction of these developments augers against the America's middle class. It is an oligarchical and profit driven system, with people and governments trailing along behind in the slip stream. Fairness and equitable concerns are deemed irrelevant and congress has capitulated. But too many Americans are too ill-informed, anxious and angry about these matters to do anything that is effective about them.

Greek Honesty
Kimball Corson
07/08/2015, Pago Pago, American Samoa

True or false; the Greek people lie and cheat more than most other European people.

I think its true. They even lied to get into the EU and created dummied books to back up the lies.

Sorry, But I Am a Merkel Fan
Kimball Corson
07/08/2015, Pago Pago, American Samoa

I have a high regard for the woman. She is very smart. She weighs everything. She acts slowly and deliberately. Her longevity is astounding. So is her popularity and not just in Germany. Her instincts as a leader are superior.

I realize she is now under the gun. Even so, she is unflappable and can't be bullied. And while she still might make the wrong showdown decision here, I would not write her off yet, or even if she did. She proceeds cautiously. She has held things together so far, even when other would blow them off. She is indeed a great world leader.

Of course, we have our Sarah Palin or even Perry, Sanitorium, or baby Jeb, but still, Merkel is the measure, the milestone, the master. A woman who symbolizes Germany and what it is -- a powerhouse that does things correctly, and is now asked to coddle an errant, loudmouthed fool as a family cousin.

Greek Reform Proposals Are Vague and Inadequate
Kimball Corson
07/08/2015, Pago Pago, American Samoa

This is the real heart of the matter to my mind. The only way to fix its government and economy is to begin a sound program of repair, but Greece does not have such a program or even think that way.. Without a sound program, Greece has no chance, zero. Yet no one in Greece is seriously paying attention here and Greece has had three years to get its act together here. As one top economist has put it, "No country -- including Greece -- should expect to be offered debt relief on a silver platter; relief must be earned and justified by real reforms that restore growth, to the benefit of both debtor and creditor."

Greece is busy telling its creditors, what it thinks they want to hear, but doing an inadequate job of that -- for example, Greece is saying it will collect more taxes instead of saying "we will collect more taxes by doing a, b and c". Greece's vagueness is a bit too much for EU leaders. Part of the problem is its government is new. Part of the problem is Greece really isn't and hasn't focused on reform, but instead its focus is on getting more credit to tide it over. Saying what it thinks it has to to get more money is Greece's style. Sincere reform is lacking, in both fact and intention. The EU senses that and it is a big stumbling block.

Even Greek proposals for a revised bailout program don't have enough detail to satisfy the government's international creditors, Eurozone officials have said. This makes it more likely that Athens will need to go several more weeks without a new infusion of desperately-needed cash. It is a bad situation. Greece just doesn't get it.And it is three years later now.

"The proposals were piecemeal, vague and the Greek colleagues could not explain technically what some of them actually implied," one Eurozone official said. "So, let's hope that they present something more competent next week." Whether the the Greek negotiating stance is vague because the Greeks think they can gain further funding by being vague and so it is deliberate or whether the Greeks simply are not up to speed on the details of governance and economic reform and so cannot do better is the question. Most EU leaders are beginning to think the latter is the case. EU leaders see no hope without serious reform, but the Greeks are not on the same page there. The approach is more say what you have to in order to get bailout funds.

Some form of help for Greece is going to be needed even it is a food drop program. The Greeks cannot be left to starve, EU leaders including Merkel understand that. The issue is whether to give them substantial new bailout monies when they have no serious agenda or plans to restructure their government and reform their economy. This is what EU leaders are thinking. They are on a different page than the Greeks and understand how much time the Greeks have had to develop plans and do better.

The Developing Health Insurance Monopsony
Kimball Corson
07/07/2015, Pago Pago, American Samoa

Before, but particularly since the Supreme Court's recent ruling on Obamacare, there has been a huge rush and rash of mergers among the nation's biggest healthcare insurers. The developing result is going to be only two or three mega insurers left who will then act as a monopsony and use conscious parallelism to set prices as a single monopoly.

Their shareholders and executives will love it, but all of the rest of us will face the equivalent of a health insurance monopoly. We will then pay dearly and through the nose for health insurance. And the federal antitrust laws won't protect us because 1) they are too feeble anyway and 2) under the McCarran Ferguson Act, antitrust enforcement is left to the states for insurance matters and the states are captive regulators. The insurance companies call the shots, but even if they didn't, the various states can only act within their own borders and not in a coordinated fashion across all state lines to deal with the problem. The mergers can't be stopped and neither can the prospect of monopoly pricing for health insurance, at least not with the laws on the books.

We are due to be screwed royally and more than we already are in the health care insurance area and no one is going to stop it. Obamacare has nothing to do with it. The problem will result from monopsony pricing by too few insurers after the mergers. These guys understand exactly what they are up to. We are the ones asleep and about to be asked to bend over. The behemoth resulting companies will laugh all the way to the bank and American healthcare will become even more expense and a bigger joke than it already is.

If America is too stupid to understand what I have explained here and quickly act to stop it in our bought off congress, we deserve the screwing we are about to get.

Healthcare in America
Kimball Corson
07/06/2015, Pago Pago, American Samoa

The central inference here from this diagram is that competition in American healthcare is not working. Yet, that is the raison d'ĂȘtre for allowing the profit motivation and capitalism to provide those services instead of government.

Our costs are double on average, and the service we get is worse, as gauged by outcomes (except for cancer). It is a failed market, similar to a failed state. But how many understand what I am saying here?

Reaction to the Greek Referendum Vote
Kimball Corson
07/06/2015, Pago Pago, American Samoa

Greece has rejected by popular vote the last terms of the EU troika. The No vote was by a margin of 62 to 38. Reactions so far, with my observations, are --

German Chancellor Angela Merkel's deputy said Athens had wrecked any hope of compromise with its euro zone partners by overwhelmingly rejecting further austerity. Merkel herself was quiet. -- Good.

Merkel and French President Francois Hollande conferred by telephone and will meet in Paris on Monday afternoon to seek a joint response. Responding to their call, European Council President Donald Tusk announced that euro zone leaders would meet in Brussels on Tuesday evening (1600 GMT). -- Appropriate.

German Vice-Chancellor Sigmar Gabriel, leader of Merkel's center-left Social Democratic junior coalition partner, said it was hard to conceive of fresh negotiations on lending more billions to Athens after Greeks voted against more austerity. Leftist Prime Minister Alexis Tsipras had "torn down the last bridges on which Greece and Europe could have moved towards a compromise," Gabriel told the Tagesspiegel daily. -- A knee jerk reaction, I say.

Italy's foreign minister, Paolo Gentiloni, said the euro zone should resume efforts to reach a deal with Athens. -- A better position.

There was a thunderous silence from top EU policymakers in Brussels and Frankfurt who conferred by telephone, but avoided public appearances to comment on an outcome that was a stunning setback for EU governments but delighted Eurosceptic populists. -- An appropriate response, I think.

The European Commission said in a brief statement that it "takes note of and respects" the referendum result. -- Ditto, I say.

European Parliament President Martin Schulz said the EU should start preparing a humanitarian aid program for Greece. -- True, regardless.

Any future negotiations will run up against the hardening of opinion in Germany. ----- True.

In Britain, anti-EU UK Independence Party leader Nigel Farage commended Greek voters for "calling the EU's bluff" and said "The EU project is now dying. It's fantastic to see the courage of the Greek people in the face of political and economic bullying from Brussels," -- Baloney, mostly.

Eurosceptics in the Netherlands and Italy joined the chorus of glee at the EU's discomfiture. -- Silly.

What of the EU . . .in the Face of Greek Hubris?
Kimball Corson
07/06/2015, Pago Pago, American Samoa

The Greek "no" vote was so strong, so emotional and so internationally supported that it seriously threatens the necessary trust needed for future negotiations. The Greek rhetoric was terrible -- e.g, the then-Finance Minister Varoufakis accused the EU of terrorism. While such talk was effective in mobilizing the Greek people, it had a strong boomerang effect destroying any easy way to establish a new dialogue. The Greeks are proud, and indeed arrogant, given their failings, and they just demonstrated that at the polls. But then austerity is no good either.

But what about the wounded pride of Berlin and Brussels and of the creditors who feel truly insulted and beleaguered by the Greeks in their outrage as well as by world opinion? While feeling so, after Greece made a real mess of its economy and government, living high on the hog, they are now being asked by Greece for new credit extensions and more favorable loan repayment terms.

To be sure, it is a hard pill the EU is being asked to swallow. Greece did screw up in a huge way and shows little contrition or regret about doing so. That is the impression.

Why Free Markets Cannot Efficiently Provide Health Care
Kimball Corson
07/06/2015, Pago Pago, American Samoa

Put bluntly, free markets do not work in the healthcare area. Nobel Laureate Kenneth Arrow showed us that and how, many years ago. Absent free markets that function properly, it is clear that government has to be involved, hopefully to assist in achieving similar results, that is, cost effective and efficiently provided medical care. However, government involvement has also been a conspicuous failure in the US.

The reason markets do not work properly is two-fold (1) the varieties of uncertainty involved are too great for free markets to handle, and (2) doctors feel morally obligated to treat whoever comes to them, regardless of whether they can pay. Understand that markets can and do deal with risk all the time, but they cannot deal with uncertainty. Risk entails probabilities associated with a few well defined alternatives. Uncertainty entails unknown, ill defined outcomes without stable probabilities.

Consider a standard product or service available for purchase. With a bit of search effort it can be well known and it is certainly well defined. You can also shop vendors to learn from whom you want to buy it. You have time for that. You can as well decide when to buy the product. The price of most products is low relative to your monthly income. You know the product will be what you want and need because you have checked it out in advance. Finally, you know the cost of the product from various sellers from your time spent shopping. These facts allow you to shop around effectively for the product so sellers must compete for your business. Competition is well enabled and effective.

But uncertainly abounds in health care. Consider first, the varieties of uncertainty involved in purchasing medical care as a product. One, you don't know when you are going to need it. Two, you don't know what type of medical care you will need. Three, you don't know who (what specialist) will provide it. Four, you don't know what it will cost. Five, you don't know whether the proposed treatment will be effective or whether further treatment will be required. Six, you don't know who will pay what proportions of it. Seven, you do not even know where you will be when you need it. Shopping around to induce competition is wholly precluded in this situation entailing so much uncertainty. A market cannot work properly. Think about it objectively.

Such price and product uncertainty are enough to cause any market to malfunction, but add in the treatment attitudes of doctors and understand that free markets have little chance. Just making within 600 feet of an emergency room usually assures at least initial treatment regardless of the ability to pay. Costs can rival buying a house. All of these factors together destroy the free market mechanism for efficiently allocating resources in this area at minimal cost. That doctors practice or try to practice medicine to a uniform, single standard of care further compounds this problem.

Then, into this mix, throw health insurance companies and health care providers gunning to earn a handsome profit off each patient and the problems become further compounded and insurmountable. Insurers want to insure only the young and healthy, screening aggressively for pre-existing illnesses, and deny coverage to the elderly, even if they are healthy. Many of the young and healthy do not want to buy health insurance, leaving a higher percentage of those sick or ill among the insured. Insurance companies feel compelled to raise their rates and are doing so rapidly, but then even more young and healthy drop their coverage and the situation spirals out of control. Obamacare helps but not enough.

Markets are simply unable to effectively address health care needs under the free enterprise model or indeed even with our system of ineffective regulation. Price gouging simply replaces shop around competition. The need for a single payor national health care system without the profit motive involved becomes abundantly clear.

Germany Has a Secret the World Needs to Know
Kimball Corson
07/05/2015, Pago Pago, American Samoa

German per capita GDP is among the highest in Europe, but German household wealth is less than even Greece's. Why is the question. The short, quick and incompressible answer is that is not true, if we make some corrections. Correcting for different household sizes and home ownership rates (vs renting), using mean rather than median measures, and observing that German wealth is less capitalized and more socialized than in other EU countries, you will find that German per capita wealth is actually and not surprisingly much higher than per capita wealth in Greece, Italy or Spain. Let me explain.

Because the German economic system is so stabilized and well regulated, there is much less impetus to acquire personal wealth. Take housing for example. German housing is readily available to rent, rents are relatively reasonable and highly regulated to avoid surprises by way of hikes or drops, and leases are very well protected. There is no great advantage to owning or accumulating wealth in that manner, or more generally in Germany, as I will show. Greeks on the other hand have much higher home ownership rates and much more housing instability. Its housing market went boom and bust like ours. Germany's did neither.

Median wealth per capita in Germany is low, but mean per capita wealth is not. The rich own much of the capital in Germany but they don't personally make claims on it much or collateralize it for other purposes. It productively stays largely in place. This is key. Much of Germany's wealth remains productively in place and works to generate income that benefits almost everyone. Very little is converted for consumption, compared to what occurs in most countries.

The German economy is geared to be productive and afford everyone what is needed. Those are its organizational imperatives that we don't really understand. Free healthcare, free university education for those who qualify or free apprenticeship training and education for those who don't, good retirement pensions fully funded, and many other quality benefits afforded to the German people, do not get weighed into household income or wealth figures, although productive wealth is high and so is per capital GDP, more than twice the GDP figure in Greece. Per capita GDP in Germany in US dollars is $47,627; in Greece, it's $21,683 as of 2009 before Greece's collapse.

German wages, however, are much lower than in some EU countries because Germany invests heavily and maintains its capital stock very well. Looking at household income before or after taxes or household wealth in Germany gives a very misleading picture of how well off the German people are. In a very real sense and in economic terms, the Germans are almost the opposite of the Greeks The saying is it take three Greeks to do the work of one German. The Greek economy is corrupt and unstable. The German economy is much more honest, well run and stable. The German system is sustainable. The Greek system is not.

I could go on, but the point is don't think of the Germans as having less national income or national wealth than the Greeks. The very opposite is true as the aggregate figures show. Germany is an enviable powerhouse.


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