There is no reason students in the United States pay ten times the tuition fees Canadian students pay to get a quality higher education. There is no reason for one healthcare bill to bankrupt a family while insurance companies refuse to pay just to make sure their profits soar. And, there is no reason for a family to pay more for childcare than their middle class mortgage costs them. These are just a few examples leading to angry Americans unable to sustain a good economic quality of life. Runaway greed is breaking America apart when big business and large corporations, and their owner billionaires, buy our Congress to look the other way.
Our economic system has been rigged for over 40 years. The model is the ultimate Quid Pro Quo whose incentives are to drive prices and profits up, even when unjustified or harmful to the average American family.
Why should an average tuition fee at a U.S. ranked university cost $40,000 a year when McGill University in Canada charges less than $3,000 a year for as good of an education in the same field of study? How did the U.S. embrace this inequitable model, which has driven student loan debts to soar to over $2 trillion a year? A higher debt than credit card debt, or home mortgages? That’s not an accident. It is by design to benefit private banks to the tunes of tens of billions a year in interest payments.
Like we said, runaway greed.
The pressure to perform is leading big business into deceptive and fraudulent territories when it ties executive pay to performance
EXECUTIVE BONUSES UP THE KAZOO
Large performance-based compensation packages for CEO’s and their executives have become a major part of the problem, leading to runaway greed, which in turn drives the country towards an economically-deprived middle class. Executives, in certain instances, when they realize they cannot meet the profit goals analysts set for them, and which shareholders rely upon to determine stock performance metrics, have resorted to fraudulent behavior in order to cash their bonus checks. Often running in the tens of millions of dollars annually for their CEO’s.
One good example is the student loan servicer Navient. Some 36 U.S. states sued the company for fraud, which resulted in a $1.85 Billion settlement AFTER their executives cashed their bonuses. The same goes for the Wells Fargo bank, which opened millions of ghost accounts to reach a certain milestone for their executives to cash tens of millions in bonus payments. These executive never paid their bonuses back.
The pressure to perform is leading big business into deceptive and fraudulent territories when it ties executive pay to performance, an area that even the Harvard Business Review recommended corporate America to stop practicing. Runaway greed is breaking America apart as consumers end-up footing the bills for their actions, even if executives are caught and their companies are penalized.
And maybe, it would take a seismic stock crash for the system to realign itself with the interests of everyone. Consumers, executives, and investors.
GREED AND INCOME INEQUALITY
Two iconic investment figures, in Warren Buffett and Michael Burry, are betting the stock market may soon take a downturn or even crash. Buffett, through Berkshire Hathaway, sold some $18 Billions in equities, and Burry bet some $1.6 Billion on Put Options on index funds that track the S&P 500, as well as the NASAQ-100. Burry predicted the downturn of 2008, which netted his investors a 475% return in a short period of time.
Are their moves tied to the idea that runaway greed is breaking America apart? Or, is the downturn related to the periodic inflationary-pressure of the U.S. economy. All we know is that the status quo of simply big business taking as much as they can from the average American using stockholders’ greed and CEO’s compensatory performance packages are not sustainable. The system, sooner or later, will break. The early sign is the anger most Americans are experiencing as they struggle to make ends meet, even when their income is comfortable.
And maybe, it would take a seismic stock crash for the system to realign itself with the interests of everyone. Consumers, executives, and investors. Maybe it would take such a wake-up call for Congress to realize that the Reaganomics of the 1980s has led us to today’s disastrous outcome.
We hope we are wrong about the stock market crash. But we do not see a way out of the economic quagmire Ronald Reagan established some 40 years ago.