We all know that there are companies that produce things, like Apple and Google and Microsoft and GM, and there are people who work for them (represented by unions). These companies that produce things are who I’m calling the “producers”: tech and manufacturers and their employees. They are the representatives of our real economy, the ones who make up not only the workforce but the material nature of our everyday lives. Every building you work in, car you drive, road you drive on, and bit of technology that you use are produced by this group.
But I’d like to focus on a different component of our economy: the money handlers. These people take money from one group and distribute it to another. This group is commonly referred to as the FIRE sector: finance, insurance, and real estate. They don’t produce anything: they make all of their money by taking it out of the transaction somehow. They’re like someone who slices a piece of cake owned by one person and then serves it to someone else — all of their wealth consists of the amount of cake they can get to stick to their fingers during the transfer. The difference between the size of the piece of cake they initially collect and the size of the piece of cake that they eventually pass around is their profit: the bigger the cake starts out and the smaller it is when distributed always means more cake for them.
So insurance companies, for example, take your money in the form of premiums and then distribute it to doctors, medical facilities, and pharmaceutical companies in the form of negotiated payments for services. Insurance companies make their money — and they make billions upon billions of dollars every year — by collecting more money in premiums than they pay out in services. So they are motivated to charge premiums as high as the system can bear and pay for as few services as the system will allow. That is where their profit comes from.
The nature of the system motivates insurance companies to pay out very little, of course, and it’s well-known that insurance companies often deny payment not because denial of payment is justified, but because they save money that way: too many people will just pay the bill rather than fight the denial of payment. I worked for the American Arbitration Association briefly in late 1999, and I saw first hand how evil the insurance industry can be as the AAA was moderating a class action lawsuit against Prudential for predatory insurance practices.
That’s the thing with an industry that just sucks money out of a system without producing anything: it only cares about its own short term profitability because its only money comes from there. On the other hand, producers understand that they need educated employees, so they care about education. Producers know how much money they lose from sick workers, so they care about healthcare too. But insurance companies? They don’t benefit at all from an educated populace and don’t care about healthcare except for minimizing payment.
That same kind of thinking extends to the financial sector (in large part) and real estate: they just suck money out of a transaction between parties that are actually interested in and invested in the system as a whole — and I mean as a whole. All of our infrastructure, technology, healthcare, and education are needed by the producers to conduct their business. They may grumble about having to pay for it, but they still need it, and they know it.
So the FIRE sector is essentially a leech on our system that doesn’t benefit from the operations of the system itself. It just needs a host to suck on to stay fat and happy.
During his term in office, Bill Clinton helped deregulate the leeches. Some of the leeches working for Bill then got jobs in the financial sector, working for companies such as Goldman Sachs that were at the center of the 2008 financial crash — who then became major donors to Hillary’s budding Senate career. As we see, the problem is that a leech will just suck and suck and suck and suck until its host is dead, if it’s allowed to do so. It doesn’t matter that the leech will die when the host dies. Leeches are too stupid to understand that. They just want to get as fat and happy as they can as quickly as possible, so all they care about is an unrestricted blood flow.
And that is why we nearly had another worldwide Great Depression in 2008. The leeches ran wild.
So do you understand now why so many people are saying Bernie’s plans are impractical? Bernie’s plans cut out the leeches, and many times the leeches are funding economists and think tanks and even university economic departments.
Under our current system (let’s just look at health insurance), the money flows this way:
- Everyday people and businesses pay high premiums to insurance companies.
- Insurance companies collect these premiums, usually from employers (cost of administration plus MASSIVE PROFITS)
- Doctors, etc., receive payment for services from insurance companies.
Sanders’s plan would collect a 2.2% tax on individuals plus a 6.8% tax on businesses (in PLACE OF premiums) to support this cash flow instead:
- Everyday people and businesses pay a relatively low tax (compared to premiums — you are in the top 5% of the population at least if your premiums and the amount of your employer’s payment is more than 8.8% of your own salary).
- The federal government collects taxes (cost of administration only, but no profit)
- Doctors, etc., receive payment for services from the federal government.
That is why Bernie’s plan will help grow the economy. It will put more money into the pockets of people at the bottom and in their employers’ pockets. It will grow the economy from the bottom up. Obviously: because these are the people who spend their money within the system itself rather than hide it in overseas tax shelters.
Now I know some of you are thinking that big corporations (both leeches and producers) shelter their money too, and they do. But saving money on health insurance premiums benefits small businesses that keep their money here in the US, in the system. Small business accounts for almost 50% of all workers and 60% of job growth since the 2008 crash. The money saved under Sanders’s plans for health insurance and education will benefit a significant number of Americans who live and work in this country and spend their money within its borders. It will help their employers too, because small businesses pay higher premiums (think about that logic for awhile: who benefits from it?). Yes, it will grow the economy.
Education works the same way. The cost of college isn’t just tuition, fees, and room and board. It’s tuition, fees, room and board, and interest on student loan debt (i.e., leech profits).
Just as our health insurance is being run to benefit the insurance leeches, education is being run to benefit banking leeches.
We need the leeches, don’t get me wrong. Health insurance allows us to distribute the risk of serious injury or illness. Loans allow us to buy cars and houses before we’ve had time to save for them, which would be virtually impossible for most of us before retirement. But, the federal government can do the same thing just as well, and we certainly don’t need the leeches running things, because we’ve already seen what leeches do when they have their way. Remember the 2008 financial crash.
Now, the leeches have been supporting the Clintons, including Hillary, and the producers have been supporting Sanders. I’m talking about lifetime donor base. Bernie has every right to make videos like these, and to give speeches like these:
And that’s why I don’t think it’s all that great that Hillary has been raising so much money for downticket Democrats: she’s selling out the whole party to the leeches.
Here’s an overview. Let me start with Bernie Sanders’s donor base. Of his top twenty lifetime donors,
- 15 are unions. They represent the working and middle class. Producers.
- 3 are in the tech sector, including Google (his top donor), Microsoft, and Apple. They represent people who actually produce stuff rather than just shift money around. Producers.
- 1 is the UC system, and educators are well represented on this list in unions as well. Producers.
- 1 are the trial lawyers, which has for a long time been supporters of the Democratic Party. Service industry.
Now let’s compare that to Hillary Clinton’s top twenty lifetime donors:
- Her top donor is Emily’s list, an organization working for women’s rights. That’s admirable. Service industry.
- 2 of her top donors are the UC system and Harvard University. Like the trial lawyers, they have traditionally given to the Democratic Party. Service industry.
- 2 are major media corporations: Time Warner and 21st Century Fox, the owner of Fox News of all things. Keep in mind that six umbrella corporations control 90% of American media and you’ll understand why news coverage has been so pathetically biased in favor of Hillary Clinton. Producers? Service industry? A little of both?
- There are 8 large, international, very specific law firms on Clinton’s top 20 list: DLA Piper; Skadden, Arps et al; Kirkland & Ellis; Paul, Weiss et al; Greenburg Traurig LLP; Sullivan & Cromwell; Akin, Gump et al; Ernest & Young (large, multinational audit firm). I have not had the time to research each one specifically, but most of them seem involved in representing the interests of multinational corporations around the world. Trial lawyers as a group don’t appear in the top 20. Leech support.
- There is 1 manufacturing company: Corning, Inc. Producer.
- There is 1 entertainment company: National Amusements, Inc. Producer.
- There are 5 firms from the financial sector, four of them very high on the list: Citigroup, Inc.; Goldman Sachs; J.P. Morgan Chase & Co.; Lehman Brothers; and Morgan Stanley. Nothing but leeches.
- And, of course, there are no unions. Workers aren’t represented here.
It’s that last group of five that is the most problematic, but of course we should see the law firms as folded into these and the media giants. As you know, in 2008 the world experienced the largest financial crash in history since the Great Depression. The U.S. Senate’s “Levin–Coburn Report concluded that the crisis was the result of ‘high risk, complex financial products; undisclosed conflicts of interest; the failure of regulators, the credit rating agencies, and the market itself to rein in the excesses of Wall Street.'”
Bottom line: Wall Street caused the crash. But who do we mean by “Wall Street”?
- Citigroup, Inc., Hillary Clinton’s no. 2 biggest donor: Massive recipient of federal bailout money after the 2008 crash. The people who were the architects of loosening regulations in the late 1990s under Bill Clinton, Robert Rubin and Charles Prince, later found themselves on Citigroup’s board of directors pushing it toward the risky practices that led to its insolvency.
- Goldman Sachs, Hillary Clinton’s no. 4 largest donor: Profited from the financial collapse and was later fined $550 million by the SEC.
- J.P. Morgan Chase & Co.: Hillary Clinton’s no. 5 largest donor, which has been involved in a long list of controversies. It was fined $88 million by the Office of Foreign Assets Control in 2012 and was investigated by the Department of Justice for its role in the 2008 financial scandal, which found in preliminary investigations that it violated federal securities laws. The SEC has also been investigating this firm, which is also implicated in the Bernie Madoff scandal.
- Morgan Stanley: Hillary Clinton’s no. 6 largest donor. This firm also has a long list of actions against it, with the Federal Reserve announcing a Consent Order against the firm on April 3, 2012 for “‘a pattern of misconduct and negligence in residential mortgage loan servicing and foreclosure processing.’ The consent order requires the firm to review foreclosure proceedings conducted by the firm. The firm will also be responsible for monetary sanctions.”
- Lehman Brothers: Hillary Clinton’s no. 18 largest donor, this firm is now bankrupt and was found guilty of major financial malfeasance in the 2008 financial scandal, for reasons that included gimmicky bookkeeping.
Four of Clinton’s top six donors and a fifth in her top twenty are implicated in the 2008 financial crash and guilty of massive and destructive financial malfeasance. It’s not just that she’s taking Wall St. money. It’s that she’s taking Wall St. money from its biggest criminals. The Clinton campaign is being supported by large donors: 100 donors alone had contributed $195 million to Clinton’s campaign as of February 2016 while the Sanders campaign has been supported by over 5 million contributors — the largest donor base in history — who have averaged gifts of $27 each.
While the middle class is being squeezed, the largest transfer of wealth in history has been taking place, and it is primarily benefitting the top 1%.
Bill Clinton doesn’t take this at all seriously. He doesn’t take the damage caused worldwide by his policies and donors seriously. He recently, glibly said Sanders supporters believe we should “Shoot every third person on Wall St.”
When he said that, some people who have been paying attention thought, “No, every one of them should be shot,” while others thought, “Yes, and jail the other two.”
There is rampant, destructive criminality at the heart of the Clintons’ donor base, and everyone who observes it has a right to be concerned. Dismissing it just makes it worse. That’s been a common pattern within pro-Hillary discourse: to diminish the negative effects of these measurably destructive policies.
Please, NY voters: vote for producers and not for leeches. In other words, vote for yourself. The leeches have caused enough damage.
And in homage to our current political environment, a video: