Posts tagged ‘aristocracy’

Our New Aristocracy and The Little People

The New Aristocracy includes our political class and its hangers on, crony capitalists, most bureaucrats, “public servants” like Eliot Spitzer, “celebrities”, most journalists, “the media”, limousine liberals, big banks, Wall Street, most academics, public employee unions, race hustlers, diversity “trainers”, “environmentalists”, and “progressives” of all stripes.

One of the strangest things about the modern progression in liberal thought is its increasing comfort with elitism and high style. Over the last 30 years, the enjoyment of refined tastes, both material and psychological, has become a hallmark of liberalism — hand in glove with the art of professional altruism, so necessary to the guilt-free enjoyment of the good life. Take most any contemporary issue, and the theme of elite progressivism predominates.

Liberal Apartheid

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Crony Capitalism Index

Crony capitalism is another reason we need a Revolving Door Tax (RDT).

Would this be a money-making proposition, allowing an investor a piece of the upside as the companies use the power of the government to their advantage? Or would it be a money-losing proposition, because the companies whose CEOs are spending their time cultivating government relationships are doing so only as a desperate tactic because their firms are otherwise unable to compete successfully in the marketplace on the basis of the value they offer their customers?

So I spent some time running the numbers. Suppose one began this strategy at the beginning of the Obama administration, buying one share of each publicly traded company with an executive appointed by the president on February 6, 2009 to the President’s Economic Recovery Advisory Board. That would be UBS, GE, CAT, and ORCL. In the nearly two years since then (using the Monday February 7 closing prices, and using Yahoo! Finance historical price data that adjusts for splits and dividends), the gain would have been 145% — far outperforming the 52% return of the S&P 500 Index over the same period.

Suppose that later that year, you decided to buy one share of each American publicly traded company that had a top executive attend President Obama’s first state dinner at the White House, in honor of Prime Minister Singh of India. GE and CAT are on the list again, along with Honeywell, Pepsi (CEO Indra Nooyi) and Ethan Allen (ETH) CEO Farooq Kathwari.The return through day’s end February 7, 2011 would have been 46%, versus a 19% gain for the S&P 500 over the same period.

Or suppose you wanted to invest in the publicly traded companies whose executives President Obama appointed on July 7, 2010 to the President’s Export Council. Buying UPS, Boeing, Met Life, Disney, Pfizer, Dow Chemical, Ford, Verizon, United Airlines, ADM, and Xerox would have earned a 30% return over a period in which the S&P 500 gained 24%.

So far, it looks like a pretty good way of outperforming the market.

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New York City’s Future?

It is the new aristocracy; landing a job with the state is like hitting the lottery. Californians have discovered that, in today’s low/non-interest economy, a $70,000 salary with defined benefit public pension for life is far better than having the income from a lifetime savings of $3 million.

Or, look at it another way: with passbooks paying 0.5-1%, the successful private accountant or lawyer could put away $10,000 a month for thirty years of his productive career and still not match the monthly retirement income of the Caltrans worker who quit at 60 with modest contributions to PERS.
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There are thousands of drivers without licenses, insurance, registration, and elementary knowledge of road courtesy. Half of all accidents in Los Angeles are hit-and-runs.


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Coastal folk seem to view high taxes like Mafia protection money, but in the sense of psychological satisfaction and freedom from guilt. For now, sales, gas, and income taxes are not so high as to matter to those who voted for them, at least in view of the social and political advantages of coastal living: the beautiful weather, the Pacific panorama, the hip culture of recreational light drug use, neat restaurants, sports, fine wines, solar and wind romance, foreign cars, and general repugnance at religion, guns, conservatives, and traditional anything.


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One of the questions I always hear from strangers: “Why doesn’t everyone leave?” The answer is simple: for the coastal overdogs there is nowhere else where the money is as good and the weather and scenery are as enjoyable. How much would you pay to walk in cut-offs in February and not in three jackets in Montana? And for the interior underclass, California’s entitlements and poor-paying service jobs are paradise compared to Honduras, Jalisco, or Southeast Asia. And, yes, the middle-class small farmers, hardware-store owners, company retirees, and electricians are leaving in droves.


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How then does the California coalition work, and in some sense work so well?

The coastal elite offers an agenda for more welfare funding, scholarships, class warfare, public unions, diversity, affirmative action, open borders, and amnesty, and in response the interior voter signs off on everything from gay marriage, solar and wind subsidies, gun restrictions, mass transit schemes, and the entire progressive tax-and-spend agenda. Most of this coalition never much sees one another.

The young Mountain View programmer keeps clear of Woodlake. He even has only a vague idea of what life is like for those who live in nearby Redwood City and make his arugula salad at the hip pasta bar in Palo Alto. In turn, the Redwood City dishwasher has an equally murky sense that the wealthy kid who works at Google does not wish to deport his uncle — and so the two become unspoken political partners of sorts. One of the state’s wealthiest cities, a gated Atherton, is juxtaposed to one of its most Latinate communities, Redwood City. But they might as well be Mercury and Pluto. Or should we applaud that the owner of the manor and his grass cutter vote identically — and against the interests of the guy who sold and serviced the Honda lawn mower?

In the flesh, the energetic people I associate with during the week in Silicon Valley and see on the Stanford campus and on University Avenue are, it must be said, innovative folk, but soft apartheidists: where they live, where their kids go to schools, where they eat, and whom they associate with are governed by a class, and de facto racial, sensibility that would make Afrikaners of old proud.

The liberal aristocracy is as class-bound as the old Republican blue-stockings, but saved from populist ostracism by what I have called the “hip” exemption — liberalism’s new veneer that allows one to be both consumer and critic of the Westernized good life, to praise the people and to stay as far away from them as possible. Mitt Romney is an outsourcer; Google’s offshore holdings are cool.

California at Twilight, Victor Davis Hanson


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Ozymandias

Mockery and minimalist living are best, then enjoy the decline.

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