.. “The Rebel Allocator” is the opposite of most business novels. Here, the rich capitalist isn’t an evil genius using genetic engineering to hijack the brains of newborn babies. Instead, he is a hero: an investing mastermind who regards allocating capital as a noble calling that improves other people’s lives.
Blunt and bristly, with zero tolerance for stupidity, Mr. Xavier spouts proverbs and zingers. A mash-up of Mr. Munger and Mr. Buffett, he often invokes their ideas.
.. Taking a shine to Nick, Mr. Xavier asks him to write his biography. Like many young people today, Nick wonders if becoming a billionaire is inherently immoral when poverty is still widespread.
Mr. Xavier teaches Nick what separates great businesses from good and bad ones. He uses three drinking straws, labeled “cost,” “price” and “value,” to demonstrate: When a business can charge a higher price than its goods or services cost, the difference is profit. When the value its customers feel they get is greater than price, that difference is brand or pricing power—the ability to raise prices without losing customers.
As Mr. Xavier moves the straws around, Nick learns that investing decisions can make the world a better place: “Good capital allocation means doing more with less to create happier customers,” says Mr. Xavier. “Profit should be celebrated as a signal that an entrepreneur provided value while consuming the least amount of resources to do so.”
.. “I have known no wise people who didn’t read all the time—none, zero,” Mr. Munger once said. “You’d be amazed at how much Warren reads—and at how much I read. My children laugh at me. They think I’m a book with a couple of legs sticking out.”
.. The money managers among them are “like a bunch of cod fishermen after all the cod’s been overfished,” Mr. Munger tells me. “They don’t catch a lot of cod, but they keep on fishing in the same waters. That’s what’s happened to all these value investors. Maybe they should move to where the fish are.”
By that, he presumably means not the bargain companies that have become almost an endangered species, but rather the great companies at fair prices that Mr. Buffett has been favoring for the past couple decades under Mr. Munger’s influence.
With Steve Bannon out of the White House, it’s clearer than ever that Donald Trump’s promise to be a populist fighting for ordinary workers was worth about as much as any other Trump promise — that is, nothing.
His agenda, such as it is, amounts to reverse Robin Hood with extra racism — the conventional Republican strategy of taking from struggling families to give to the rich, while distracting lower-income whites by attacking Those People, with the only difference being just how blatantly he plays the race card.
.. So is the Trump agenda dead? Not necessarily, because trickle-down has never been the whole story of the Republican assault on workers. Or to put it another way: Don’t just watch Congress, keep your eyes on what federal agencies are doing.
.. According to the Congressional Budget Office, back in 1980 the top 1 percent paid 33 percent of its income in federal taxes. Under Reagan, that share briefly fell below 25 percent. But as of 2013, the most recent year covered, Obama’s tax hikes had brought federal taxes on the 1 percent back up to 34 percent of income.
.. Medicaid, which in 1980 covered only 7 percent of nonelderly Americans. Today that number is up to 21 percent.
.. While the rich still pay taxes and the safety net has in some ways gotten stronger, the decades since Reagan have nonetheless been marked by vastly increased inequality, with stagnating wages for most, but soaring incomes for a tiny elite. How did that happen?
Yes, globalization probably played some role, as did technology. But other wealthy countries, just as exposed to the winds of global change, haven’t seen anything like America’s headlong rush into a new Gilded Age. To understand what happened to us, and in particular to American workers, you need to look at policy
.. truck drivers, whose pay used to make them members of the middle class. No more: Their real wages have fallen about a third since the 1970s, with most of the decline taking place during the Reagan years.
.. What happened to truckers was, basically, the collapse of their bargaining power due in part to a changed ideological climate — not least at the National Labor Relations Board — that encouraged private employers to fight unionization, and in part to deregulation that undercut the position of unionized firms.
.. Does anyone doubt that financial deregulation played an important role in surging incomes at the very top of the income distribution?
Nothing in his history as a developer showed any inclination to a friend of working people:
- He bought foreign steel because it was cheaper;
- he imported foreign workers because he could pay them less and they are more vulnerable;
- he stiffed small contractors because they couldn’t fight back.
.. I bristle when i hear the chattering class call Trump a populist. He’s not. Like the entire GOP, he is a classist, mouthing platitudes to fool the masses but acting as reverse Robin Hoods when it really counts. The entire charade of repealing ACA is a prime example
.. Populists are politicians who fight to help people who need the federal government to protect them against the rich and powerful.
.. James J: .. For those who do not know and associate with members of the working class, voting against one’s own economic self interest is a head-scratcher. But today’s working class is not your father’s working class. It certainly is not MY father’s working class.
Dad, because of The Depression and then war in Europe, never graduated high school. But he was an avid reader — our small working class home in a Midwest auto town was filled with books, newspapers and magazines of all varieties. He and our neighbors were union and they knew the issues.
Today’s working class has an appetite for information, but the source of that info is polluted. It comes from outlets owned by the same corporate billionaires who are picking workers’ pockets for 40 hours a week.
The outlets — Fox News, Breitbart… — are managed by very intelligent, very schooled and very slick pros. They play the intellectually lazy and proudly uneducated like a symphony; the best cons are the ones where the marks walk away thinking they got the best of the deal.
Today’s working class thinks it understands complex issues because its members read Tweets and listen to manipulating right-wing talk radio all day.
And once whipped into a hateful lather by millionaires con artists like Rush and Hannity and Bannon, economic self interest disappears behind a fog of anger and dogma.
On the subject of cycles, Warren Buffett likes to talk about “the natural progression, the three I’s.” As he put it to Charlie Rose in 2008, those I’s are “the innovators, the imitators and the idiots.” One creates, one enhances — and one screws it all up.
Buffett was describing the process that led to the 2008 housing and financial crises. But he might as well have been talking about the decline of the conservative movement in America.
.. If we have reached the point where rank-and-file conservatives see nothing amiss with giving Hannity an award named for Buckley, then surely there’s a Milton Friedman Prize awaiting Steve Bannon for his insights on free trade.
.. Buckley shed isolationism, segregationism and anti-Semitism, and insisted the conservative movement do likewise.
.. as the gatekeeper of conservative ideas, he denounced the inverted Marxism of Ayn Rand, the conspiracy theories of Robert Welch (founder of the John Birch Society) and the white populism of George Wallace and Pat Buchanan.
.. In March 2000, he trained his sights on “the narcissist” and “demagogue” Donald Trump. “When he looks at a glass, he is mesmerized by its reflection,” he wrote in a prophetic short essay in Cigar Aficionado. “The resistance to a corrupting demagogy,” he warned, “should take first priority” for Americans.
.. The conservatism he nourished was fundamentally literary: To play a significant part in it you had to know how to write, and in order to write well you had to read widely, and in order to do that you had to, well, enjoy reading. In hindsight, 2008, the year of Sarah Palin, was also the year when literary conservatism went into eclipse.
Suddenly, you didn’t need to devote a month to researching and writing a 7,000-word critique of Obama administration’s policy on, say, Syria to be taken seriously as a conservative foreign-policy expert. You just needed to mouth off about it for five minutes on “The O’Reilly Factor.” For books there were always ghostwriters;
..The quality of an idea could be tested not by its ability to withstand scrutiny from experts, but by the willingness of people to swallow it.
.. It shouldn’t be a surprise that a post-literate conservative world should have been so quick to embrace a semi-literate presidential candidate. Nor, in hindsight, is it strange that, with the role Buckley once played in maintaining conservative ideological hygiene retired, the ideas he expunged should have made such a quick and pestilential comeback.
- Thus, when Hannity peddles conspiracy theories about Seth Rich, the young Democratic National Committee staffer murdered in Washington last year, that’s an echo of John Birch.
- When fellow Fox host Tucker Carlson — who once aspired to be the next Buckley and now aims to be the next Ann Coulter — tries to reinvent himself as the tribune of the working class, he’s speaking for the modern-day George Wallace voter.
- Isolationism is already back, thanks to Trump.
- Anti-Semitism can’t be far behind, either, and not just on the alt-right.
a Buckley Award for Sean Hannity suggests nothing ironic
.. a fresh reminder of who now holds the commanding heights of conservative life, and what it is that they think.
Digital books stagnate in closed, dull systems, while printed books are shareable, lovely and enduring. What comes next?