New Economic Perspectives has the article Forget Taxes for Redistribution: What to do about Inequality.

And, as we know, Uncle Sam doesn’t need any stinking taxes to “pay for” jobs and income and healthcare and decent retirements for the poor. If you have unemployed resources, free lunches abound! Just put the resources to work, and you’ve got Bernstein’s wish list filled.

Forget taxes for redistribution. It will not work. It is a bad meme—especially in America. Once you let the greedy rich get their riches, trying to take them away is harder than prying guns out of the “cold dead hands” of NRA members.

Every time a progressive proposes a tax hike on the rich to pay for welfare, the Koch brothers giggle in gleeful delight. It is the surest way to prevent any policies that would help the poor. Tying tax hikes to sensible policy plays right into the greedy hands of the Conservatives and Regressives.

Did you ever hear a One-Percenter ask for a tax hike to bail out Wall Street? Come on, they are not that stupid.

What I’ve long argued is that we need “predistribution”, not “redistribution”.

This article is a continuation of a series that I first posted about in Randy Wray: What are Taxes For? The MMT Approach. Reading the article referred to in the previous post gives you more context and nuance than appears in the current article.  In this article, Wray goes to such an extreme to make his point, that you may not think about other aspects of his recommended policy mentioned in that previous article.

Wray says more about pre-distribution in a subsequent article Pre-distribution or redistribution? The Piketty moment, the Democrats, and the oncoming elections (Guest Post).  Again, Wray’s rant might cloud what he is saying.

Senator Bernie Sanders has the article Flashback: Republicans Block VA Benefits on his web site.

Republicans in February blocked important legislation from Sen. Bernie Sanders to improve veterans’ access to health care among other things. Only two Republicans, Sens. Dean Heller and Jerry Moran, voted for the veterans benefits bill, which was endorsed by every major veterans organization.

A country like ours that can make its own currency at the drop of a few computer key strokes always has enough money to pay for whatever it wants. It may not have the actual resources, but it has the money. In our case, with high unemployment, unused factory capacity, and excess natural resources, there is absolutely no reason to not fund the VA bill.

Money this country owes in terms of its own currency that it creates, will never be a burden for future generations to pay off unless we keep strangling this country with phony economics that strangles the productive capacity of the nation.

Every felon probably knows the phrase, “If you can’t do the time, don’t do the crime.” For our country, we need to remember, “If you can’t afford the war, don’t start one.” It doesn’t rhyme, but it is just as applicable.

We all knew that George W. Bush and the Republicans would do this to our veterans when they started the wars in Iraq and Afghanistan. That is just one of the reasons we should have been adamantly opposed to both wars, and especially to the one in Iraq. If we cannot afford to support our troops, we should stop meddling in world affairs.

The Washington Post has the story Sen. Sanders to propose bills addressing VA issues.

Sen. Bernie Sanders (I-Vt.) announced Friday that he will introduce a bill to hold top officials at the Department of Veterans Affairs accountable for performance problems and re-introduce comprehensive VA legislation that failed in February.

If we have to elect Bernie Sanders as President in 2016 to get fair treatment of our veterans, then let’s do it.

Truth Out has the article Behind the Koch Brothers: New Book Spills the Secrets of Nation’s Most Powerful and Private Dynasty on the Democracy Now interview below.

Charles and David Koch have funneled millions of dollars to conservative candidates and causes over the last four decades while working tirelessly to open the floodgates for money in politics. The Koch brothers’ net worth tops $100 billion, currently tying for fourth on the Forbes 400 list of wealthiest Americans. Their rise to becoming two of the nation’s most powerful political figures is explored in the new book, Sons of Wichita: How the Koch Brothers Became America’s Most Powerful and Private Dynasty. The story is based on hundreds of interviews with Koch family and friends, as well as thousands of pages of legal documents. We are joined by the book’s author, Daniel Schulman, a senior editor at Mother Jones magazine.

I get the sense that the author and the book are more nuanced than the interviewers let on. However, I think the Koch brothers are still worth fearing.

Talking Points Memo has the story Scaring The Crap Out of People Oddly Not Winning Fans.

Open Carry Texas and a group of other aggressive gun rights groups have issued a joint statement telling their members, Dudes, let’s stop taking our guns to restaurants. It’s freaking people out and making them hate us.

I suspected that not all gun enthusiasts were batshit crazy. It’s nice to find out that what I suspected is actually true.

Naked Capitalism has the post Financial Times Finds “Many” Errors in Piketty Analysis, Argues They Undermine His Thesis by Yves Smith.

The Financial Times story had more of a “gotcha” tone that one expects to see in the mainstream media, and compared the mistakes to the famous spreadsheet errors in Carmen Reinhart’s and Kenneth Rogoff’s work on debt to GDP ratios. But at least so far, there is a key difference: only one other study had found results similar to the those claimed by Reinhart and Rogoff. By contrast, Piketty is far from alone in finding rising concentrations of wealth at the very top; Demos points out that a new study published by Garbriel Zucman and Emmanuel Saez paints a post-war picture similar to Piketty’s. Thus the FT’s assertion that their corrections of Piketty’s data show no increase in wealth concentration is an awfully bold claim, and will likely be scrutinized as much as the errors and possible methodological shortcomings that Giles found.
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With Piketty’s book having gotten so much attention over the last few weeks, it’s a given that there will be a lot of eyes on the Giles findings and considerable debate over how much of an impact they have on Piketty’s conclusions. So hold tight and see how this shakes out.

While Naked Capitalism has its own reasons for disagreeing with some of Piketty’s conclusions, they at least have the humility to admit that the final answer is not in yet.  As I was reading about the claims made by The Financial Times story, I was wondering how The Financial Times could conclude that there was no evidence of increasing concentrations of wealth at the top 1%.  I was happy to see that Yves Smith made note of this hard to believe conclusion.

The Washington Post has the story Iran hangs key figure in banking scandal.

Iran’s state media is reporting that a key player in the country’s biggest-ever banking scandal was executed here on Saturday.
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But fighting financial corruption, which was rampant during Ahmadinejad’s two terms, was a promise made by Hassan Rouhani when he assumed office last August.

Now that’s what I call keeping a campaign promise.

Some economists believe that we could fix the income inequality in this country by taxing the rich more.  I bet a few hangings would convince many of the rich to stop accumulating wealth by nefarious means in the first place.

Let it be noted that I am not in favor of capital punishment.  It is just too tempting to use.

Crooks and Liars has the story Why Alan Grayson Was Kept Off Benghazi Committee.

When we look at who makes up the Dems, we notice that there was nobody selected from House Committee on Foreign Affairs, which seemed very odd to me, as well as to others that have also mentioned this.
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So why was he included on the committee now? I’ve been checking around since the announcement was made and a source who wishes to remain anonymous said Rep. Steny Hoyer was afraid that Grayson would be too rambunctious for his taste, and so used his power to keep him off the committee — despite the fact that Eliot Engel, the ranking Democrat on the Foreign Affairs committee, had already handpicked Rep. Grayson and gave his selection to Nancy Pelosi. Steny Hoyer went crying (to who, we don’t know) and Nancy Pelosi then pulled Grayson from the panel.

I do not think Nancy Pelosi’s pleas for support for Democrats in the House will get any favorable support from me ever again. I don’t know how many times we Democrats can be stabbed in the back by our own leaders and yet be expected to continue to support them.

Naked Capitalism has the post Is the Piketty Enthusiasm Bubble Subsiding? by Yves Smith. Yves has a lot of positive things to say about the book.  I think the following excerpt from her post is a good summary of what is troubling some critics of the Piketty book.

But as Taylor has pointed out in some technical detail, and others have alluded to, there are many reasons other than the invisible hand for r to remain high. Much of this can involve market failure, which Piketty explicitly rejects. See page 424 if you don’t believe me. R greater than g has nothing to do with market imperfections.

James Galbraith opened his review noting that capital meant power. If Piketty’s empirical analyses are right, and r has been persistently high, I’d suggest it reflects the power of the rich, not the natural forces of a free market economy. Higher taxes would help stymie the rich, but so would financial regulations, anti-trust campaigns, and public financing of politics that could minimize their power and privilege.

I’d like to read Piketty’s book with an open mind, but not an empty one.  That is why I wanted to make note of the criticisms.

The Real News Network has an 8 part series.  I have chosen the title of segment 3 that represents what this series is all about.

At the beginning of segment 1, Paul Jay gives an introduction that gives you the sense of what the series will be about.

Baltimore has many distinctions, one of which is not that well known, certainly not outside Baltimore. But Baltimore is the home of the subprime mortgage. It was in the 1990s that the African-American population of Baltimore, and to some extent New York and Chicago, but primarily Baltimore, were targeted to have loans at under-market rate that would later balloon and force people out of their houses.
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Tens of thousands of people were thrown out of their houses and millions of dollars lost by homeowners. Of course, when people lose their houses, it’s not just the people in those houses that suffer. For those of you who have seen the show The Wire, one of the reasons you see all of these boarded-up houses in Baltimore is not just because people have been thrown out but because neighborhoods start to deteriorate. As houses are foreclosed on, other houses start not to be able to get loans from banks to get fixed up, and places that were vibrant and real communities wind up half-vacant and you–what begins a process of, more or less, ethnic cleansing.

That’s just one small example how finance exploits all of us. And that’s the subtitle of a new book. And its author is now with me in the studio.

Thanks for joining us.

COSTAS LAPAVITSAS, PROF. ECONOMICS, UNIV. OF LONDON: Pleasure to be here.

JAY: So Costas Lapavitsas is a professor of economics at the School of Oriental and African Studies, University of London. He’s a member of Research on Money and Finance (RMF) and the lead author of RMF’s book Crisis in the Eurozone. His previous publications include Social Foundations of Markets, Money and Credit and Political Economy of Money and Finance. His most recent book is Profiting without Producing: How Finance Exploits Us All.

The first segment is titled Growing Up in the Greek Police State – Costas Lapavitsas on Reality Asserts Itself (1/8). You may be surprised at the aspects of history that you can learn from the segment. At this point, you can a different picture of the recent history of Greece and how it might connect to the main subject of the series.

The second segment is titled After the Fall of the Dictatorship, I Knew Political Economy was the Key – Lapavitsas on Reality Asserts Itself (2/8).

With the some history of the world and the background of the interviewee out of the way (all very interesting to see and hear about), we get to segment 3 titled The Rise of the Big Banks – Costas Lapavitsas on Reality Asserts Itself (3/8).

Mr. Lapavitsas says that large scale industrialization created the need for massive amounts of capital and big banks, a process that developed an aggressive global capitalism

This is the part where you begin to see how finance and capitalism were qualitatively transformed from its early beginnings to where we are now.

As of the writing of this blog entry on May 23, 2014, only these three segments of the series have been published. I have high hopes for the value of the remaining 5 segments. You can go to the web site for The Real News Network yourself to get the remaining segments as they are published. Although, I wouldn’t be surprised if I blog about those other segments as they come out.

The fourth part of this series is covered in my subsequent post The Financialization of Big Business – Costas Lapavitsas on Reality Asserts Itself (4/8).

New Economic Perspectives has the article Sutherland Explained in 1939 Why GM Killing Customers Isn’t Treated as “Real Crime” by William K. Black.

Edwin Sutherland was right about elite white-collar crime; and he’s still right

This year is the 75^th anniversary of Edwin Sutherland’s 1939 Presidential address to the annual meeting of sociologists in which he announced the concept of white-collar crime.
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Economists and most criminologists don’t understand financial crimes

“This paper is concerned with crime in relation to business. The economists are well acquainted with business methods but not accustomed to consider them from the point of view of crime; many sociologists are well acquainted with crime but not accustomed to consider it as expressed in business. This paper is an attempt to integrate these two bodies of knowledge. More accurately stated, it is a comparison of crime in the upper or white-collar class, composed of respectable or at least respected business and professional men, and crime in the lower class, composed of persons of low socioeconomic status.”

Sutherland’s doctorate combined the study of the economy and sociology. Note that Sutherland emphasized from the beginning the importance of elite white-collar crime by businessmen and professionals and what I refer to as “seemingly legitimate” entities – Sutherland archly calls them “respected” though they are not “respectable.”

This treatment of white-collar crime is not universal. The news has had stories of how white-collar Criminals in China have been executed for their crimes. For example, see the article 22 Chinese People Who Were Handed The Death Sentence For White Collar Crime.

Not that I am a proponent of capital punishment, but imagine if that kind of punishment were possible in the USA for white-collar crime.