For all the current US administration has complained about the opposition being “socialist,” they’ve certainly gone all-in on the state partially owning private companies.
Almost like cries of “socialism” have become a dog whistle instead of what the term actually means.
Not a dog whistle when its actually true. How many more DSA candidates need to be elected before you stop saying this?
Candidates endorsed by the Democratic Socialists of America have scored victories in 35 primary elections so far this year, including upsets against entrenched incumbents.
https://www.washingtonexaminer.com/news/campaigns/congressio...
And at what level are they? Aren't there over half a million elected officials, one way or another, in the USA?
There are nearly twenty thousand at state level or above.
https://www.econstor.eu/bitstream/10419/263159/1/1815112018....
The most striking difference is that top investors in Europe hold much higher stakes than in the United States. The top ten in Europe features several governments.
Do you want to apply the word you had in mind to those governments too?
"A fascist corporation can be defined as a government-directed confederation of employers and employees unions, with the aim of overseeing production in a comprehensive manner. Theoretically, each corporation within this structure assumes the responsibility of advocating for the interests of its respective profession, particularly through the negotiation of labor agreements and similar measures."
A lot of dystopian literature has been written with the premise that governments would wither away and end up replaced by mega-corporations that become the de facto law. I suppose the theory where the government just buys all the corporations instead because they control the money supply was generally overlooked by those authors. The end result probably isn't much different, but the path to get there has some differences, I suppose. It also seems reasonable to say that the authors, not being from the finance world (at least that I know of) may not have realized the depths to which financial engineering would sink and the willingness of the governments to participate in it.
Back in the 1980s when cyberpunk was really thriving the government at least made mouth noises about fighting the worst excesses of financial engineering. Whether history bears that out as something they were actually doing, the reader is welcome to come to their own conclusions about. But the government at least tried to look like a countervailing force to financial engineering.
*sigh*
If you want human attention, expend human labour.
* https://en.wikipedia.org/wiki/Socialism_with_Chinese_charact...
That or just go full fascism. Who knows!@
They also have an incentive to use legal pressure to suppress competitors. But I am sure this (and other administrations) would never throw their weight around for fun and profit. /s
OpenAI ‘in early talks to give 5% stake to US government’
Thanks dad.
sovereign funds, federal ownership making companies "too big to fail" is 100% socialism
but republicans are devious enough to know not to call it that
so do we get to idiotically slur the current administration and call them communists?
There is bipartisan support for industrial policy.
2008 shaped our thinking on this and most of our policymakers in the 19th century were influence by Alexander Hamilton and Fredrich List.
Our allies (Japan, South Korea) as well as our competitors (China) use this as well, and so did the US until the 1990s.
I support the CHIPS Act and IRA. I also support building an American SWF as well as operationalizing state-managed SWFs and pension funds into SDFs as well. And so do most decisionmakers who were in the Obama and Biden admins as well as the Trump admin.
Edit: can't reply
> so I'm not sure we should shape all of our policy
What I mean is pre-2008 it was heterodox to assume that government capital could be deployed to build or rebuild industries.
The default assumption was industrial policy only succeeded once (Japan).
The mixture of public-private subsidizes at the state level to develop GreenTech clusters in TX and CA, Semiconductor clusters in AZ, NatGas and Oil production in the Dakotas, and other such "booms" in the 2010s compared to Germany's hard stance on austerity leading to deindustrialization and China catching up to Germany in a number of core industrial technologies influenced the newish generation of policymakers.
> For this specific industrial policy
Yes [0][1][2][3].
[0] - https://www.bloomberg.com/news/articles/2024-09-06/biden-aid...
[1] - https://www.nytimes.com/2024/09/10/us/politics/us-sovereign-...
[2] - https://www.yalejournal.org/publications/wealth-and-diplomac...
[3] - https://irs.princeton.edu/industrial-policy-united-states
Tax the rich.
If it were in return for a tax break then they might even do it voluntarily. The key would be to get in while valuation is low.
Think of it like the original Bitcoin wallet, its value is $0 because none of those will ever be sold.
If dividends are involved it could matter but the government basically gets 20% of dividends already and extra 4% doesn't make a huge difference.
Returning to blocking stock buybacks as price manipulation and forcing businesses to give out dividends again would actually impact revenue in a meaningful way in contrast.
I guess preferential treatment could be the only issue?
I'm not sure it's the only issue, but for now focusing only on this issue: it's a really big issue. The R's often complained about Dems choosing winners and losers (IIRC related to the solar industry). This is now way beyond what the Dems were trying to do by advancing solar. The gov can use it's buying power to sway things towards Intel, for example, over AMD. Huge potential for conflict of interest that will distort the markets.
The other tangential issue is that in some cases these can look like bribes. For example, OpenAI "offering" 5% of their stock to the gov.
Well, Intel is actually important for national defense because of their foundries...
Whereas AMD sold their foundries long ago so now they're just one of many fabless chip designers.
Pretty sure that's the goal: the government wants a competent cutting edge chip maker on US soil.
[1]: https://en.wikipedia.org/wiki/Rare_earths_trade_dispute
Plenty of us Obama and Biden alums are industrial policy fans, and there is a similar cohort across the aisle.
Heck, I earn less as a VC today than if I remained a SWE or PM in my niche but with more stress and worse working hours.
Edit: Why the downvotes? Do y'all actually even know PE/VC and leadership salary scales?!?
This isn't communism. It's state capitalism that socializes losses and privatizes profits.
It's bad communism and bad capitalism at the same time. I'd like to call this 'Napoleonism,' after the pig Napoleon in George Orwell's Animal Farm
Karl wrote for a republican newspaper in New York.
Shall I dig out my Auferstanden aus Ruinen vinyl?
- Commerce dept: Intel, IBM quantum, GlobalFoundries, D-Wave, Rigetti, xLight
- Dept of "war": MP Materials for rare earths, L3Harris rocket motors for munitions
- Energy dept: Lithium Americas / Thacker Pass, Westinghouse nuclear
- White House: U.S. Steel golden share
This doesn't preclude the creation of a generalized SWF, but there is a difference between an SWF, SDF, and everything in-between.
This is the same approach Japan, South Korea, China, and India use as well.
And you think this is that? Oh dear.
> the people who have been running American countries have been consistently making decisions that are against the national interest
Freudian slip?
It is called the Alaska Permanent Fund and a constitutionally established sovereign wealth fund invested in a diversified portfolio and managed by a state-owned corporation, the Alaska Permanent Fund Corporation.
Earnings help fund the state government and annual dividend checks are distributed to residents.
I've seen this assertion a few times now in the thread here, can you elaborate? The events of 2008 were kind of extraordinary, so I'm not sure we should shape all of our policy based on that - except in terms of trying to avoid another 2008/Great Recession, but I don't see these actions doing that.
For this specific industrial policy? The Intel deal was an outright shakedown.
There's bipartisan support for healthcare, too. Unfortunately, quite a bit of serious dissension on exactly what that means.
edit: Yes [0][1][2][3].
So, no. Not the "pick random companies and extort shares out of them" approach.
So do I. As I understand it, those bills involved incentives that any company could access provided that they met the conditions (manufacture in US, etc). The IRA also provided direct incentives to consumers to spend their money as they saw fit (EVs, solar, heat pumps, etc).
Direct investment by the executive branch is something else entirely. For example, Intel is now blessed and too big to fail. Why would anyone start a competitor to it? If you did start a competitor, your first call would be to Commerce, right? Seems like a heaping dose of moral hazard.
I can understand direct investment in very narrow circumstances, such as rare earth minerals and possibly something like nuclear power generation.
An alternative is a truly-independent sovereign wealth fund, or independently-governed pension investment arm such as the Canada Pension Plan Investment Board. But I doubt, in light of the Humphrey's Executor decision, that it's possible for the United States to create such an entity now.
Of course once the government does have a large stake in the largest monopoly-like companies, it's immensely motivated to keep them large. Hmm. This idea isn't good.
US government has always had a policy of sabotaging international competition
What does this mean?
[0] https://itep.org/88-profitable-corporations-paid-zero-income...
That's unfortunately not been the reality through Obama, Trump and Biden policies.
thisislife2•2h ago
everdrive•1h ago