"Big Finance Is Strangling Innovation"

[applegrove]

Big Finance Is Strangling Innovation

By Lynn Stuart Parramore at Salon

http://www.salon.com/2013/07/27/big_finance_is_sucking_the_life_out_of_our_economy_partner/

"SNIP....................................

Think about it: what GE product did you recently purchase that enhanced your life? In the era of financialization, big companies like GE have turned their attention to making quick Wall Street profits instead of fabulous products. In the 1980s, for example, GE’s Jack Welch rapidly expanded the company’s business into issuing credit cards, mortgage lending and other financial activities. It wouldn’t be long before financial operations accounted for almost half of the company’s profit.

Eventually we ended up with a situation in which, as my colleague Joshua Holland has noted, a corporate executive will starve the company of needed resources and hinder its ability to be productive in the interest of short-term gains. In his book The Speculation Economy, Lawrence Mitchell of George Washington University points out that a recent survey of CEOs of major American corporations revealed that nearly 80 percent would have “at least moderately mutilated their businesses in order to meet [financial] analysts’ quarterly profit estimates.”

Silvers notes that as financialization fever took over, the U.S. developed a dangerous imbalance between private and public finance, and we promoted public policy founded on the strange idea that there really is no such thing as a public good. We embraced the idea that capital markets are more efficient if regulators step aside, and we subscribed to the faulty notion that deregulation of financial institutions would help the economy prosper.

Without regulation and strong unions to ensure that the U.S. kept steadily and thoughtfully channeling money into productive investments like training workers and creating stable jobs with reasonable incomes, the economy essentially became a casino and the gap between the rich and the rest grew wider. We became known less for innovation that enriched people’s lives than for creating complicated financial instruments that are designed to rip people off. From 2004-2008, for example, when other advanced economies were pouring money into clean technology, the U.S. financial markets were rapidly innovating new financial products that served to extract yet more wealth from the productive parts of our economy.

..................................SNIP"

[msongs]

1. from the top down our political class is heartily endorsing this strategy - austerity for us and

glory days for them and their corporate owners. next up, the dismantling of social security starting with chained cpi

[Egalitarian Thug]

2. Big everything stifles innovation and buries discovery. We simply have to flush the shit that

has been planted in our minds by half a century of lies. Invention, innovation, discovery are all bad for corporate objectives.
& R