Last week we talked about the cap table and I showed an example of one in a format I like. So if you are one of the founders and you own 19.6% of the business after three rounds of venture financing and you sell the company, is it possible that you would get less than 19.6% of the proceeds on the sale? The answer is yes. Not enough founders realize this.
The reason you can sell your company and not get your fully diluted ownership percentage of the proceeds is that preferred stock holders get to choose between getting their cost back or taking their fully diluted ownership percentage of the proceeds. If any of your preferred investors choose the former, and the sale price is low enough, you will not get your full percentage of the proceeds.
The way to model this out is called a liquidation analysis. I'm on vacation right now so I haven't built the liquidation analysis (which will be a second tab in the google spreadsheet). I will do that between now and next week and we will finish this topic next monday with a demonstration of how to build a liquidation analysis.
I have to confess that I didn’t understand hardly a word of this, but then I suffer from discalcula.What I stopped by at the bar for was to ask you what you, a venture capitalist, albeit one with a number of technocommunist views, think about the Occupy Wall Street stuff.I bet you know what I think — not much. Geez, haven’t we progressed from Port Huron, 50 years ago?!Try as I may, I don’t hate the rich. I guess it’s because they’ve always given me jobs. It’s that simple.
lol check U6 unemployment — they’re not giving jobs to anyone anymore, prokofy!also, prokofy, in january we discussed that gold was going to $1650. or rather, you recommended shorting it at 1340, while i said it would hit 1650 by the end of the year. of course, i claim no credit as such a “prediction,” for lack of a better term, requires only a cursory amount of financial knowledge (it does require a willingness to see the truth, though, which is perhaps why many did not see it). nonetheless i enjoy beefing with you so i did want to rub it in, and invite you to recommend shorting gold again so that all may enjoy laughs in the future. i am glad you brought up occupy wall st though. i mean, it is kind of futile since monetary policy reform is what they really want/need, and sitting in a street is unlikely to accomplish that (though i empathize with their concerns and spirit). OWS and the meme that is spreading throughout the USA and western world is indicative of the class warfare borne out of fraudulent monetary policy. fred previously said monetary policy was a “boring” issue, which remains perhaps my favorite comment in fredland history, even more so than your repeated calls to short gold. though in due time all will see the futility of such views as failure to reform monetary policy ensures there will be no growth and an ongoing decline of civilization (though perhaps opportunities for speculative bubbles in a variety of sectors, least of which not being secondary markets and Internet IPOs….basically where ever the international banking cartel — goldman, bofa, jpm, hsbc, citi — direct the money they took). ignorance is futile. only the truth can set us free.9/11 was an inside job,kid mercury
I shorted gold at ~$1770 last month, and cashed out last week. Then I reversed polarity and went long with calls on GLD. No luck with those yet.
on the way to $5,000 and beyond i do think there will be a number of great short opportunities (i.e. sizable counter-trend retracements) for those so inclined; i know some active traders that really did well, picking up the move down from $1850 to $1650. i do think we’ve reached a bottom and are ready to reverse (i started buying again), though perhaps one more dip to $1550-ish is a common technical take. kinda bummed i bought the bulk of my mining shares a month ago, i could’ve gotten twice as many if i had waited until last week. oh well, i still view them as my lottery tickets that could get me rich.
Last month before gold corrected, I suggested gold longs consider hedging it (didn’t have a crystal ball, but it was relatively cheap to hedge back then). Last week, I suggested the same thing for those who are long US Treasury bonds. Also relatively cheap to hedge (via optimal puts on the ETF TLT as a proxy), and the run up on them over the last few months has been crazy.
Appreciate you and Dave putting your money on the line based on your trend estimates. My instincts are that there are no safe havens if and when broad economic instability strikes (ie global currencies experiencing massive swings).Call me chicken little. Maybe invest in real usable land, and hope to retain ownership through social/economic upheaval.
In addition to land, don’t forget food stockpiles and shotguns… I always thought those Montana guys were completely loopy – but nowadays I wonder whether I’m simply suffering a failure of imagination.
“I wonder whether I’m simply suffering a failure of imagination.”Great line, now that’s something worth worrying about.
yup, farmland is one of my favorite investment opportunities at the moment, for those who can afford it and build a real business on it……i do think interest rates will rise in the coming years which will send housing prices down considerably…..i’m trying to save up to buy a house then
i’d like to go down their and occupy wall street myself. i’m totally on the side of the demonstrators.
What’s stopping you?
Gotta make time in my calendar for social unrest. I don’t currently set aside time for it
What side is that? I haven’t seen a coherent message enough to know if I support them, oppose them or just don’t give a shit.
check the list of demands they have for congress here: http://coupmedia.org/occupy…too much socialism/big govt-ism for my taste. but there are some anti-bernanke people there. something for everyone!
here’s another link, some ammo for OWS haters:http://biggovernment.com/ls…
Reads like something out of We the Living.Proletariat, unite! (and while you’re at it…give us some money and pizza)Gross.
@ccrystle:disqus thanks for the link, was curious about the details of the protests and don’t normally read the news.
Tim Knight’s take on the list, if you didn’t catch it.
I’m anti wall street.
I dont even know what that means.
“In the Soviet Union, capitalism triumphed over communism. In this country, capitalism triumphed over democracy.” fran lebowitzaka – just bc we don’t know what the alternative is today, doesn’t mean we shouldn’t imagine that there might be one.
i’m against the bankers and brokers who take a toll on the productive work of entrepreneurs and their employees. i live in a city full of these types. i hate them
Nice. I would love to see a post describing this. I have never been harmed by a banker or broker (or venture capitalist) but I imagine there are some great examples out there.
I wonder if Fred is against the bankers and brokers who provide exits for his portfolio companies, by peddling their IPOs.
That’s like saying “I’m anti VC”.
yup. and many people are
GET RICH BY CREATE VALUE FOR ALL? GOOD.GET RICH BY EXTRACT VALUE FROM ALL? BAD.#OCCUPYWALLSTREET
Keep up the good work Fred – I’ve left wall street (sophism street) and feel empowered to do so because of folks like you! It’s personal pivot time!
this comment made my day off
I looked at the Tumblr link Charlie posted, with photos & letters from folks posting about their economic hardships. Sad stuff, but I can’t help thinking that if there were a Republican in the White House right now, those protests would be happening on Pennsylvania Avenue. They seem to be happening on Wall Street because to protest against President Hope & Change would spark too much cognitive dissonance.
Part of the point is to not over- or pre-determine the message. It’s hard to articulate, but there really is something to the idea that we hardly know anymore what a politics of inclusion and democracy would look like. A good place to start, politically speaking, may be just to assemble with the intuitive conviction that the government has been bought. There’s an Ezra Klein post this morning that gets at this a bit. http://wapo.st/pUHYTf For the AVC community, we DO know what open dialogue looks like. In fact, when I think about it, government would do well to borrow startups and startup culture as a model: transparency, initiative, willingness to experiment and pivot, leverage everything every contributor has, maximize individual self-efficacy. But macro level as a body politic we’ve forgotten how to do this. We think in binary terms, talking points, brand messages. The root problem, I think, is that we have let ourselves believe that money is “speech.”
You need to read this:http://wearethe99percent.tu…Medical issues keep popping up
a large percentage of personal bankruptcies are due to medical bills — among people who *have* insurancehttp://www.businessweek.com…Harvard researchers say 62% of all personal bankruptcies in the U.S. in 2007 were caused by health problems—and 78% of those filers had insurance
I know. we’re screwed if we can’t get medical issues and education back to affordable levels. it means it becomes too expensive to train someone – and people will work to exhaustion, endangering economic output….Ford got it right – train people and keep them happy, and you can make stuff effectively. don’t and your company falls apart.
the decision by corps to offer benefits in an effort to keep unions at bay has come back on them.http://www.gladwell.com/200…”nobody could have predicted …”
ME, GRIMLOCK, SAY STAND AGAINST WRONG IS DUTY OF ALL.
You would be elected Emperor in about 45 minutes.The incoherency of this “demonstration” is surpassed only by their failure to articulate any recognizable message.At the core of their beef with Wall Street is the clear and present danger of having used the wrong fork with shellfish, wearing white after Labor Day and serving an otherwise nice little crisp Sauternes with a Pittsburgh style filet.A couple of well placed pigeon droppings and this bunch is gone home to shower.
the nyc transit drivers are refusing to drive the buses to carry away the arrestedmarines are stating publicly that they are going there to help the protestorsso many people feel so completely disenfranchised, whether their collars are white or bluethe days of being able to earn a living and support a family just by having a strong back and a strong work ethic are all but goneand the days of going to college and having a key to the future seem out of reach for so many
I really wish I could be as nuts as Abbie Hoffman in moments like this.
Fred – in addition to the analysis & math, it would also be great to hear your perspective, from the investor’s position, on why entrepreneurs might see various liquidation preferences offered. Beyond the obvious of wanting to ensure minimum returns, explain what a desired liquidation preference suggests about the investors view of the market (that the portfolio co is in), the entrepreneur / governance of the entrepreneur, and the investor’s portfolio.
I’ll look forward to seeing the spreadsheet next week. FWIW, I’d love to see a new spreadsheet every Monday if it was topical.
I’ve been a avc voyeur for a long time, but this is a topic that I really need to understand. Looking forward to it. Thanks for doing all that you do. Raph
Welcome – why this topic? What else do you want to see
Ok i’m probably being stupid here but i don’t see the second tab……
2nd tab to be built and added later (“between now and next week…”).
oh see there i go scanning things too quickly — missed the all important “will be”
@andyswan:disqus @ccrystle:disqus whether we want lower taxes for all (right) or higher taxes and real redistribution (left) the larger issue is 1. congress doesnt care what you want2. most people dont care about anythingrevolution via local economies is the real solution, as that enables a small group of people to build a local, sustainable infrastructure for when the big government party runs out of other pepole’s money and we run into much larger problems. this is where the internet is supposed to really deliver, although if all these companies just focus on scaling internationally (going for breadth instead of depth) and going public on wall st and taking on the regulations that will entail (which will limit the ability to be truly politically and economically independent), then we lose.
maslow disagrees with #2 : http://en.wikipedia.org/wik…
I’m not going for the IPO. My projects are for building an audience, helping people, and help guide change.I agree that’s a big problem, companies who aren’t being socially responsible – who don’t care to help teach people and aren’t mentors/role models for everyone. Facebook is a terrible role model: It’s okay to steal others ideas, lie about it, and then we’ll break your trust a billion times – but it’s okay to do – and we can do it since you’re forced into the ‘family’ you can’t do anything about it (at least until a better understanding, responsible and family forms community that has good morales ingrained).
investors want IPOs, though, so for entrepreneurs seeking capital, that is an issue.
The OWS crew may not have all the right answers or even the right questions but they do know that somehow theirs lives have been altered by recent economic events. Would they be making lots of money if nothing had happened in 07, I doubt it. But, it’s good to see someone holler a bit over whats happened.It’s not good that we’re that docile.
Is there a scenario in which the founder can maintain shares in the company after the sale? If the sale price is just enough to cover the cost of the preferred stockholders shares, why sell? Who determines when to sell? And do any investors fund a company without becoming preferred stockholders?
Selling the company requires the approval of the board and the stockholders (usually the preferred and common voting together on an as if converted to common stock basis), and, if the company’s certificate of incorporation provides for separate class voting of the preferred (called “protective provisions”), then a separate class vote of the preferred may also be required.Common holders can sometimes be forced to vote in favor of a sale of the company if there is a “drag along voting agreement” in place. There is a sample of a drag along voting agreement in the Series Seed model Investors’ Rights Agreement: http://www.seriesseed.com/f….In practice I think it is pretty rare to invoke the drag along rights.As to investors not becoming preferred holders, they could buy common stock but that normally only occurs with “friends and family” financings and not with sophisticated angels or institutional investors. Sophisticated angels and institutional investors may choose to fund your company with convertible notes, but those are intended to convert into preferred shares on the company’s next equity financing.
Thank you very much, Bo!
Fred, I’ve created a tool for playing “what if” with different liquidation preference terms. It shows how you can (literally) bend the lines depending on whether the deal has cumulative or noncumulative dividends and participation on the preferred. It’s in my dropbox public folder at:http://dl.dropbox.com/u/244…Hope this helps
ME, GRIMLOCK, APPLAUD AVCERS THAT BRAVELY TRY TO STAY ON TOPIC DESPITE ALL THIS HOT CONTROVERSY WAVED IN FACE. ‘<
I was glad to see the Tea Party form and get out in the street and I am thrilled with the bunch that is occupying Wall Street! I hope the trend continues and these “communities” continue to form and grow in real life not just on the internet.I hope that the Arab Spring leads to an American Fall…or Winter.Too big to fail and the plutocracy have to go….they have destroyed traditional capitalism.A little social unrest, a little violence in the street, might be just what the plutocracy and their minions in Washington need.
BEST THING ABOUT TEAPARTY IS IT INSPIRE FORMATION OF GROUPS NOT OWNED BY BILLIONAIRE ASSHOLES #OCCUPYWALLSTREET
Geez, nobody wants to discuss Liquidation Analysis, rather discussing Wall Street Liquidation. Fred, you struck a nerve,- Fred, the Senator from New York.
Wall Street Liquidation Analysis 😉
This is the kind of nonsense you get when the President is pissing on the leg of “billionaires, millionaires, jet plane owners” in the morning and then telling them that was just a passing squall while fundraising them in the evening.Wall Street has and always has had a stranglehold on whatever political group is going to let them feed like pigs at the trough because they either buy or rent politicians by the bushel or the peck.Politicians will literally do anything for money.Wall Street asks only one little accommodation — nationalize losses and privatize profits.A couple of little changes — bring back dueling in place of binding arbitration, publicly behead anybody who’s convicted of fraud in the inducement in excess of $1MM, rent armed drones to bond creditors as part of bankruptcy limited only to vacation homes of C-level execs and make anyone who gets more that $1MM of taxpayer funding to personally guaranty it but also to appear at all bankruptcy hearings naked.Make everyone in the US who fails to vote pay double taxes.
I’m for the public beheadings, I’m still against dueling….
Any further thoughts on compulsory voting?
I hate that it would come to that because it would punish the clout of actual voters but there seems to be some additional motivation required to exercise the basic right of a “free” person. Perhaps it is compulsory voting w/ a fine.
Guys/Gals, listen to @ccrystle:disqus on this one, not blaming the poor. The food banks across the country are drying up, so look into it and contribute. Looking at bigger picture, yes, we need to voice our opinion regarding the same old printing worthless currencies bailing out those that screwed up… simple.At the same time, the message needs to be clear. Fox is showing it as folks that work for Soros and want to reelect Obama… then all coverage becomes presidential politics.
I didn’t realize that about local food banks, It’s a place we we can help with a donation.
Very good… and spread the word!
BEST WAY TO HELP: BUY FROM AN AMERICAN. RIGHT NOW. #OCCUPYWALLSTREET
Staying with the Occupy theme….Occupy is being linked in some ways to protests in Mid East/Africa. A unifying theme/statement should be fashioned matched with patience. IMHO, the protest should be directed toward resolution of the 2 class structure taking hold. Rich people bitching/crying about their problems falls on deaf ears living in cardboard boxes (a good cartoon for @FakeGrimlock:disqus to do… don’t you think @ShanaC:disqus ?) and/or young folks falling in line re politcs yelling we need Obama (isn’t he part of the bailout problem?).We know many in the rich category got there sucking gov. $$. Then it is nice to scorn the downtrodden placing the $$ sucker name on them.We need to be looking long term at motivating the bigger population regarding the opportunites coming this decade for them and their kids. Along with the obvious and consistently failed areas needing reform (Education and so forth) is the push of investment/sweat building tools that are useful, and at a cost the bigger market can afford. All categories of jobs will benefit. As of now, the mid/lower mid/lower classes are going to fall futher behind.We can do this and do it this decade. Here we are in ’11. On the medical front, we have both the molecule sized electric machine (I assume the flipper propellers are femto), the beginning of testing method of destroying cancer cells (inside the body molecular machine identify/destroy/repair) pushing us into a post everything chemo era… leading to less intrusive treatment of everything else. Just that one example offers a lot. Yet, we still have to succomb to the fight between who owns us (right/left)? Maybe we need to follow advice of Mr. Spock… determine the right place/time where everyone will either send/shout to Washington/Wall Street these simple words… “Go to Hell!”
It’s interesting and telling when an MBA Monday post regarding liquidation analysis, pivots on a comment or two about a nation’s state of affairs, and morphs into a discussion about healthcare, big government and views on fixing the bigger problems. Are we frustrated much by observing and/or being affected by incompetence in government?? 😉
GOVERNMENT IS THE PEOPLE. IF GOVERNMENT BROKEN, PEOPLE BROKEN TOO.
i admire the vc’s who are smart and involved and brave, and make startups possible.the people playing other money games, not so much.
There is a fine line between VC and the casino that is wall street. Its hard to find that line at times. I try to stay as far on the good side of that line as possible while still working to help entrepreneurs and our investors make money.
yes: vc’s do what wall st says it does — provide the liquidity that makes markets go.
Fred,Thank you for your amazing MBA Mondays posts. I need some advice on a business topic…I am looking for a tech co-founder. PairUpNYC is currently on hiatus. Are there any other routes you would suggest?
Charlie can you articulate in 140 characters or less what their objective is? I’m really very curious
I’m posting this reply here due to disqus thread limitations. The victims-of-society hand written notes tug at heart strings but have no impact on my proposed solution to plutocracy problems. I’m sure you can find people in bad-situations in every country that ever existed. The ones I bleed for most are those who are denied opportunity by their government.I honestly have no clue how ANY of their complaints relate to Wall ST. The logical blame for each one falls directly upon the government that they are protesting in order to…..expand?It’s the solutions of the “movement”…or at least their take on the issues…. that I am interested in, not their personal situation.I’d have to ask them some very specific questions to know more:”Why do you have so much debt?””Why did you not have a health-insurance policy on your own? When I was in my 20’s I bought one individually and it cost me around $40/month…they’re still priced under $100/mo””What exactly does society owe you?””What unique and marketable skill are you offering, and how are you constantly improving it?”
After I go
That may be what they are after but their manifesto is pretty broad and far-reaching, way beyond “end the plutocracy.”
OK I’d say 98% of people agree, including me.Now…. I want to do that by ending taxation on corporations and reducing taxation on citizens, reducing regulation, ending all redistribution schemes…. get the government out of finance to get finance out of government.In other words, I believe that only through unconstrained government can plutocracy exist, therefore I suggest “strictly limiting the role of federal government to its original Constitutional constraints”Would I be welcome and my ideas embraced by this group? Or do they have an alternative solution?
if they keep voting for the same politicians over and over again, then they dont care enough to be informed or to have real change. obviously i use the 9/11 litmus test…..people still cry and wet their diapers if you go kook on them. even in the forthcoming 2012 elections, who are the candidates going to be? probably rick perry vs soetoro. both are disasters paid for by the same folks who ruin everything (wall st fascists) and anyone who has done any research into this should know that. will people vote outside of the fraudulent two party system? i know i will (unless divine intervention occurs and ron paul gets the republican nomination), but most people still won’t.financial regulation does occur, though it is regulatino designed to protect incumbents. as an example, i’ve had to reposition my business (a financial markets publisher/broker) to target non-US clients because US regulations are too much to deal with and too costly for me to even afford. meanwhile, goldman’s business of making imaginary derivatiives and selling them continues without the slightest bump in the road…..
If only it were a few greedy businessmen in top hats.The big government constituency is every American who – Works for government – Is related to someone who works for the government. – Used to work for the government, and is collecting a pension – Is collecting Social Security – Has a parent collecting Social Security – Is covered by Medicare – Has a parent covered by Medicare – Is covered by Medicaid Those aren’t policies that benefit the few versus the many. Those are policies that benefit the present at the expense of the future, the old at the expense of the young, the public sector workers at the expense of the private sector workers, the poor at the expense of the middle.
PROBLEM WITH WILL OF THE PEOPLE IS MONEY VERY GOOD AT CONTROLLING THE PEOPLE.
We do not have a democracy: the founders gave us in the words of Ben Franklin ‘a Representative Republic if you can keep it’ because as John Adams noted, “Democracy never last long. It soon wastes, exhausts and murders itself. There never was a democracy yet that did not commit suicide.”
California – every state wide office held by DemsTexas – every state wide office held by RepsIf you could retain your income for the last 10 years and the next 5 years, keeping all other outcomes neutral, where do you pick to live? For the quality of YOUR life!Policy decisions do make an impact.You can nit pick any small element but on the macro outcomes for YOU?Not even close.
Cain would be nice too. That right there tells you neither will win.Great comparison between your publicatoin/broker biz and goldman. Been there. Painful.I guess the difference between me and the community organizers is that I don’t blame Goldman, I blame the rulemakers (or the rules that allow them to be the same thing lol)
Andy, we agree on a lot, but you’re way off on this statement: “Why did you not have a health-insurance policy on your own? When I was in my 20’s I bought one individually and it cost me around $40/month…they’re still priced under $100/mo.”Now to be clear, I am not for national health care, at least how it’s being crammed down the throats of Americans, but I can tell you from very intimate experience that if you are not willing to lie on health insurance applications you can’t even get insurance in some cases. Blue Cross, Blue Shield, Anthem, and long list of others refuses to insure me because of a silly little minor issue which I told my agent about and he said “that’s no big deal, it should be fine”. Well, they all rejected me for it (you would laugh about the issue), and I refuse to lie on any such application. Furthermore, as a self-employed individual (and family) my wife does have a policy with shit coverage from Anthem/Blue Cross which carries a $3,500 deductible and costs about $500/month. Prior to my daughter taking a job where she receives group benefits, she was paying over $100/month for a $2,500 deductible policy (but with “best PPO” coverage) and then was diagnosed with a chronic illness – and the policy has covered nearly NONE of her needs. We’ve spent 10’s of thousands of dollars because every claim has to go to arbitration for coverage and we finally just say “fuck it, it’s not worth it, I’ll just cover it”. So while we agree on many issues, and I also agree with Charlie on many things, the U.S. Healthcare issue is a mess – at least for those not covered by group policies. The insurance companies are better served by playing the odds within a large group than messing with and servicing individual policies. They can take some big hits on individual policies and they are very systematically trying to kick those insureds to the curb. Again, I’m not for Obamacare, but there is a problem in the space which companies like Blue Cross/Blue Shield et al are never going to fix in the current framework.
I responded to you elsewhere about why I think these protests are on Wall Street versus in DC. But you make a good point here about how expanding the government that presides over the current status quo they dislike would solve it.But I’ll take a stab at answering your last two graphs for them.What government owes its citizens is a shot at making a decent living if they work hard and follow the rules. To put it in Ayn Rand/basketball terms, to make the economy safe for the Eddie Willerses — the hard working guys who are good team players but can’t create their own shots off the dribble. I think government has failed at that over the last few decades, mainly through naive trade policy (not countering other countries’ mercantilism) and counterproductive immigration policy (bringing in a million job seekers per year when unemployment is at post-war record levels).
Lol. We disagree and yet agree so much.I dropped out of law school because far too many people were in it.I dont see how it is difficult to figure out. The value of a degree is based largely on its scarcity. Add to that a govt that irresponsibly pays for every tuition check no matter how high….and guess what….you end up with an $80k piece of paper that seperates you and a million other kids from no one.What a disaster.
@andyswan:disqus you were smart about the law school. The thing is even though lawyers are scarce in many fields (especially those dealing with state level civil cases, the backlogs are huge) the debt level is so high for law students that it is impossible to graduate law school and be your local civil procedures guy and make money…the debt load is too much.I get the feeling a lot of my friends I grew up with will default. I can imagine at least a few marriages breaking up.
Ya…you make good points and I hear you. I dont think $500 or $1000/mo is unreasonable IF the co pays for what it says it will.I just wish we could buy across st lines and the govt wouldnt force every policy to cover asanine stuff I will never ever use (or am willing to pay for). I cant believe they arent legally allowed to sell me a policy that covers ONLY catastrophic injury/disease.I am tired of being forced to buy haircut insurance!
@andyswan:disqus Yep, I’ve wanted a decent catastrophic policy for years. I’ve been told there’s not enough profit in them, so we can’t get them from the recognized companies. And I agree about being able to buy across state lines. [edit: typo]
And I’m tired that insurance really doesn’t cover wellness and preventative care done right. it would bring down premiums…but it would gut the fee for service doctoring we have today….
Our current health care system encourages a career path of working for a very large, very stable company for a very long time. This is the opposite of the AVC crowd. This crowd wants to strike out on their own, start companies and create wealth. Healthcare costs and arbitrary denials (I agree 100% with your anecdote, Dale) create an additional strong risk of being an entrepreneur – particularly if that person is a family breadwinner.Healthcare is currently tightly coupled to employment and that is a HUGE barrier for many people to leave their employment and strike out on their own. That is a strong economic reason why we need health care reform.
dont forget food stamps…..1 in 7 americans on them……
Wish I had a double like button.
In your constituency you forgot to include those who:-Want all the government programs they’re used to, but refuse to raise taxes to pay for them (or, alternatively, those who want to cut taxes, but don’t want to lose any of the government programs that they’re used to).This constituency seems to encompass the entire State of California, if not the entire Republic. Rant all you want, but the government is us.
There you go, and that’s another great example of why the 99% / 1% dichotomy breaks down. You want to stick it to Big Ag? Cut food stamps. But then you’re also sticking it to the bottom ~14% (the 1 in 7 on food stamps).
No if you see who is on food stamps and what they eat, and who is using section 8 and how they live you would stop doing charity.I know I did.
Stop paying big ag to grow corn for corn syrup for processed food that makes people ill and drives up their healthcare costs while driving down their quality of lifeSubsidize fruits and veg instead
YESTERDAY ME, GRIMLOCK, SAY THIS:”99% OF THE MONEY ONLY MATTERS WHEN 99% OF THE FISTS LET IT. #OCCUPYWALLSTREET”IT MAYBE SUMMARIZE SOME OF IT.
Ahhh yes the old mafia shakedown. A favorite of the “peace loving” marxists.
@andyswan:disqus NO.MONEY JUST ARTIFACT OF CODE SOCIETY MAKE FOR SELF.WHEN BUGS FOUND IN CODE, SOCIETY GO INTO DEBUG MODE.
Money finances bread and circuses – always been that way.
Sometimes I want to bring the founding fathers to today and ask them what they would do about democracy….
the community organizers blamed Goldman by having AIG pay Goldman 100 cents on the dollar for AIG’s outstanding gambling debts. with hate like that who needs love?
This, I think, is a more accurate pie chart. But the Pentagon, in any case, is part of the government, and as I mentioned in the 9/11 comments thread, the military and those dependent on it are part of the constituency for big government as well:The military has, to some extent, replaced manufacturing as the direct and indirect employer of blue collar Republicans (“Reagan Democrats” in Reagan’s day). This forms a larger and more powerful constituency for certain policies than any handful of defense contractors. It also dulls the electoral anger at the offshoring of so many of America’s manufacturing jobs.When so many voters on the right are deriving their livelihoods from the government (via defense spending), and so many on the left are as well (via education and other social spending), there is a smaller political constituency for policies that would strengthen the private sector, which pays for all the rest.
Part of thread below but posting here so you get reply:The worst part is, I would have had the law degree (Boston U) for $0.00. Full ride scholarship.Still wasn’t worth it. I really wince when I see kids taking out $30k/year loans for undergrad degrees.I see a lot of value in the college EXPERIENCE…not really the education. I’d strongly suggest that people find an in-state university that they can see themselves getting out of with 4 figures of debt. (i.e. you’re gonna have to work a bit too)
I do wonder and in particular wonder how they might evolve our current idea of democracy, gov’t and representation. After all, do we still need to vote pple in to represent us as we finally have the means to represent ourselves through technology….Lobbyists would go the way of the dodo bird.
@cammacrae:disqus responding here bc of disqus limitation – haven’t read that so will go find it.You’ll like this if you haven’t seen it already – talks about the problems of personalization and algorithms without ethics…http://www.youtube.com/watc…
Perfectly correct. Brilliant in it’s simplicity and accuracy. Goldman IN government took care of Goldman OUT of government.Well played!
Not unless their aromatherapy salon has been serving up “cordite” as a new selection.The enemy of my enemy is not my friend.You, however, are.You have more life experience than a battalion of these inarticulate self indulgent callow youth.Gotta run, Tuesdays I reserve for drowning kittens and creating jobs.
Wise govt can only create a fertile environment in which the private sector can wrestle in the marketplace and fulfill market driven demand for goods and services on a profitable basis and thereby employ our countrymen to provide those services and make those goods.Jobs are created by demand not wishing and hoping.Smart politicians provide no more regulation than to keep those jobs in the US.It really is that damn simple.
“…can’t create their own jobs off the dribble…”Brilliant turn of a phrase and so true.This is the essence of what separates much of this avc audience from the rest of the world — point guards who want to handle the rock with the game in the balance.One of my soulmate level friends whose NBA number is retired always says his game was very simple — he could get the ball to any spot on the floor with 10 seconds left.
To me, this issue isn’t about partisan politics. I’m sick and tired of the Big Government + Big Business Cartel.We have seen the greatest expansion in government programs to “help” the poor during the past several decade and today there are more Americans in poverty than ever before.The best welfare program is a job and government doesn’t create jobs. Small business entrepreneurs like you do the lion’s share of that and they’re held back by the cartel and it’s so-called “consumer friendly” regulations designed to protect Big Business.
Charlie, we share a commitment to ending poverty but we have a deep disagreement about what will actually accomplish that goal. I don’t believe the Big Government + Big Business Cartel has any ability (nor in many cases, an interest) in ending it.
There is a lot of unspoken fear out there and many people are afraid to say they’re hurting.
I’m not necessarily trying to help your case, but this does remind me that in two recent searches on behalf of California based companies, I noticed an increase in the difficulty of recruiting from out of state. And this time, not just because of the obvious reasons of our housing market and the high cost of living, but I’ve had several people tell me that our state is in too much of a mess!I will add the caveat that these were not tech roles and were in fields that draw those who tend to be risk averse. I will also add that Texas is one of the most difficult states from which to get people to leave — to go anywhere. At least in my experience.
What you’re saying about California simply isn’t true. Every statewide office is not held by Democrats. Orange County is virtually all Republican. And the crazy way California is run, 2/3 of the legislature must vote to approve any tax increases. So it’ll never happen. But nobody wants to cut any services that we have. So therein lies the issue. I understand that it’s much easier to blame “the other” — to say damn the Republicans, or damn the Democrats. But it’s damn us. California, and the whole country, wants a free lunch.
Perhaps I was not clear, Arnold, I was only talking about the macro-economic implications of the 8th largest economy in the world v the 13th largest economy in the world — economies of such size that such specific pinpoints — Orange Country in California or Travis County in Texas — are subsumed in the numbers.To be precise, Orange County is not a “statewide office” though it may seem like it.At the state level, my statement is both true and clear.Having said that, California is a beautiful state but its politics have destroyed its economy.
No, your statement is not true. Look at the numbers in the state senate and assembly — it is not all democrats. i was merely using orange country as an example. democrats are not 100%. nor are they 2/3. admittedly, it’s close but it’s not there. thus, taxes cannot be raised. and i’m not saying raising taxes is the solution to all problems. but when nobody wants to cut programs and when lots want to cut taxes (cutting taxes does not take a 2/3 super majority) problems bubble up quickly.
JLM NEED DO MORE RESEARCH.CALIFORNIA PEOPLE VOTE IN UNIQUE RULES THAT DESTROY STATE.HAVE NOTHING TO DO WITH WHICH PARTY IN CONTROL.
@fake grimWho put those rules into place? Who signed them into [email protected] ArnoldReps and Senators represent Districts. They are not “statewide” office holders like Gov, Lt Gov, etc
@JLM okay, obviously no point in having a discussion with you. You know what you know and that’s that. I get it. But the fact is, until very recently a budget could not be passed in California without 2/3 vote of the legislature. This is still true of tax increases. Therefore, which party controls “statewide office” is really less important than it might seem. And anyway, the state has had a Democratic governor for how many months now? The problem is much bigger than you understand. I’m not sure you quite understand how California government works. But you know what you know. Have a nice day.
AS LONG AS NOT MIND STATE MURDER YOU OR DICTATE WHAT DO WITH PRIVATE LIFE, TEXAS GREAT PLACE TO LIVE.
One of the sad things: You could work in college and (maybe) med school and still graduate with 4 figures of debt. Sometimes more.
Maybe not, maybe they would become technologists who would need a panda algorithm to get rid of their influence…
The reasons they opposed direct democracy haven’t changed, that is, to protect the rights of the individual from the will of the majority. Federalist #10 is required reading here.The founders were also very concerned with the perpetual expansion of government and the power and “aristocracy of our moneyed corporations”. On both these counts I suspect they’d consider their successors to have failed them.
Haven’t quite delved into that when pitching a job opportunity to a Texan. Nor has the person on the other end of the phone. But the fact that they don’t pay state income tax.has come up a few times.
Silly even for a dinosaur.Don’t murder anyone in Tx and you are home free.Not a more liberal city in America than ATX.
It’s Madison at his finest, although it was published pseudonymously (real names are so 21st century!).That Eli Pariser riff ties in nicely with “The Elusive Big Idea” and the various anti-intellectual clap-trap that’s become trendy in some political circles. Proper discourse. We need it.