Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
None of the points in Post-250 was wrong. Small businesses fail at astounding rates, and it's the rest of us -- employees, creditors, taxpayers, etc. -- who end up eating the losses. As a society, we tolerate this on the premise that one eventual hit is worth the cost of multiple misses. There may be truth in that, or there may not be.
Here is your entire post:
"No matter where you live, small business owners typically draft up a business plan and take it down to the local bank. The bank extends loans to get the business up and running, loans that can't be serviced anymore once the business goes belly up. The bank and other creditors then have to make do with whatever pittances a bankruptcy judge will allow them from the proceeds of business asset liquidation. The "entrepreneur" does not lose his house or his car or the balances in his 401-k. Instead, he goes back home and comes up with a new business plan, and he gets funding to try out that new idea instead. This is part of a public policy to subsidize entrepreneurs, on the premise that when an entrepreneur actually does succeed, it can be of enough social benefit to justify the multiple losses that come in the same package."
Here is what has been addressed in my previous posts and where you are wrong:
Banks will typically want security it can come from a variety of assets, such as, but not limited to, after tax investmenstor property (such as your home), as banks will take steps to mitigate risks. Making a claim that banks or creditors may have to make due with "pittances " is not accurate.
The second point is your comment above about entrepreneurs being subsidized is also related to the first comment in which banks will typically look to get some security.
When reading the entirety of your post, it says nothing about the risk/security involved on behalf of the entrepreneur and, as such, gives a view that the risk is shoulder by the bank and others. Notice that even this last post you still leave out the entrepreneur.
So, as stated before, if you have some special gift that allows entrepreneurs to shift all this risk to someone else, there are millions interested in getting this information.
"A bank will look at your company's history, business credit, revenues, balance sheet, and your equity contributions. If you pass a credit check and you operate a healthy business, most banks will also require an additional, and tangible, guarantee that their loan will be repaid: collateral.
Collateral assets come in many forms. Defined by the Small Business Administration, collateral is "an additional form of security which can be used to assure a lender that you have a second source of loan repayment." Most commonly, collateral is real property (i.e. an owner-occupied home), but it can also be represented by your business's inventory, cash savings or deposits, and equipment. In order to structure a loan that benefits both you and your business, you'll need to make the right decision about what you offer up as collateral to the bank. It's also important to be realistic when considering the risks of defaulting on a loan, which could have harsh consequences for not only your business, but for your personal life, too. "
Despite all the due diligence in the world, one third of small businesses fail within their first two years, and half fail within five. The losses from those failures are real, and they are substantially paid not by the wannabe-entrepreneur, but by other actors left holding the bag. The fate of the wannabe-entrepreneur is to go home, draft up a new business plan, and then seek out and receive financing to try out that new plan instead. That's just how we do things here. The horse that John Wayne rides into town on is actually named Business Welfare.
Capitalism allowed to run unchecked will always fail long term. It creates a society where a small percentage of people are phenomenally wealthy and everyone else has very little. The middle class is very small and tends to shrink over time. The system collapses when the poor are fed up with slaving away and making no progress towards wealthy or even middle class. When it become impossible to progress, the poor take over and the revolution happens. When people become hopeless, they are dangerous because they have nothing to lose.
The form of capitalism that worked here in the past protected the workers and made sure they were paid a living wage. The rich paid much more in taxes, percentage wise than they do today, at least partially to subsidize the poor and all the people who had less than they did. Back in the 1950's when we accomplished great things like the Interstate Highway System and funded the space program, the country's highest tax bracket was around 90%. THE TRUTH ABOUT TAXES: High Rates On Rich People Do Not Hurt The Economy - Business Insider
For the last 40 years or so, the poor and the middle class have been losing ground. Wages stopped keeping up with the COL and fewer employers offered benefits like insurance and pensions. Too much was done to 'help' the people who don't need assistance and too little has been done for all the average people. The rich got richer and the poor got poorer. Didn't matter how hard you worked. Technology is the killing blow. Because of technology, we just don't have enough decent jobs anymore. It's just a fact. An accounting firm that used to employ hundreds of people to keep books now employs 3 people and a big computer.
Sure this can be fixed. Start by taxing the rich and raising the minimum wage over several years, to what it should be if it had kept up with inflation. Companies who don't want to operate and produce their product here should pay tariffs so high it becomes cheaper to be located in the US. Eliminate the tax loopholes for the rich and corporations. Cut the military and homeland security budgets back to the level of China's spending(they spend the second most after the US) and use that money to work on our infrastructure needs. If the insurance companies will not give the people affordable insurance that covers everything, I think Trump mentioned $15 per month, the industry needs to be put to death with single payer. In the long run, it will create more jobs than we lose.
Here's something even more simple, the acid test. All you need to do is ask yourself, is this good for the people? And if the answer is no... Don't do it!
Capitalism allowed to run unchecked will always fail long term.
No examples exist to support this claim.
Quote:
Originally Posted by yellowsnow
The form of capitalism that worked
Capitalism doesn't have "forms" except as people like to keep perverting the definition.
Quote:
Originally Posted by yellowsnow
Sure this can be fixed. Start by taxing the rich and raising the minimum wage over several years, to what it should be if it had kept up with inflation.
Price floors--where have I seen that backfire before?
Quote:
Originally Posted by yellowsnow
Companies who don't want to operate and produce their product here should pay tariffs so high it becomes cheaper to be located in the US.
Why do you want the poor not to be able to afford goods?
Quote:
Originally Posted by yellowsnow
Eliminate the tax loopholes for the rich and corporations.
Define loophole.
Quote:
Originally Posted by yellowsnow
Cut the military and homeland security budgets
Ooh, I agree with something!
Quote:
Originally Posted by yellowsnow
If the insurance companies will not give the people affordable insurance that covers everything, I think Trump mentioned $15 per month, the industry needs to be put to death with single payer. In the long run, it will create more jobs than we lose.
Uh... how can we employ MORE people at lower cost?
Quote:
Originally Posted by yellowsnow
Here's something even more simple, the acid test. All you need to do is ask yourself, is this good for the people? And if the answer is no... Don't do it!
I have a snarky comment for this but don't feel it would add to this...
Capitalism as we have it in the USA today is failing for the middle class. And much of that has to do with our generally advanced economic state. We have less need for labor and manual production due to technologies and off shoring. e.g. China is not there yet. IMO this predicament was inevitable as capitalism continued to succeed. And that continued success had to be as we the consumer demanded the cheapest goods.
Bringing things home against the grain of capitalism, as in tariffs and such, means inflation. This can be done via central policy during war, but unnecessary during these more normal times. Tariffs are too counter-productive in too many ways. And simply become another tax for the people, inflationary, with benefits only here and there for certain industries.
Taxing the rich even more is not the answer IMO. Taxing discourages investment, especially at home.I do not believe that there are enough rich, or there may not be enough rich money available to legitimately tax, to make a broad enough difference to our hobbled middle class. Going back to very high marginal rates and we will see more tax creativity/evading schemes evolve all over again.
IMO we need to resolve this problem with new central moneys. The poor we take care of. The rich take care of themselves. The middle class needs a boost/break. Central programs/subsidies to help alleviate middle class stress and provide for more economic and other security. HC, housing, education, child care, jobs, infrastructure.
Most of us (or at least a substantial amount) understand that it's not that simple. Probably the largest portion of "new" wealth is represented only by the value, placed by the markets, on the common stock of success stories like Microsoft, Amazon and Google, and many smaller, but similar success stories, and that any attempt to confiscate it would simply cause a large part of that wealth to evaporate.
Great point and I'll rep you if I can.
Similarly attempts to "tax the rich" are often unsuccessful. Wealthy people don't just sit there if subjected to confiscatory policies. If there were efforts to spoliate the actual wealth there would be serious constitutional issues under the Fifth and Fourteenth Amendments. If the efforts were to tax high-earning or high-wealth individuals many would "vote with their feet" the way such British denizens as Mick Jagger have. While justice would seem to dictate that people who can afford to pay do so this world is not always fair.
Despite all the due diligence in the world, one third of small businesses fail within their first two years, and half fail within five. The losses from those failures are real, and they are substantially paid not by the wannabe-entrepreneur, but by other actors left holding the bag. The fate of the wannabe-entrepreneur is to go home, draft up a new business plan, and then seek out and receive financing to try out that new plan instead. That's just how we do things here. The horse that John Wayne rides into town on is actually named Business Welfare.
Your previous posts left out the fact that the entrepreneur takes on risk and, in. It's cases, has to provide some type of security. You were wrong, yet your silly little ego can't accept that.
With you added assertion that the substantial portion is not paid by the entrepreneur, please provide your proof of this assertion.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
