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Jack is a graduate of Rutgers University where he majored in history. His career in the life and health insurance industry involved medical risk selection and brokerage management. Retired in Florida for over two decades after many years in NJ and NY, he occasionally writes, paints, plays poker, participates in play readings and is catching up on Shakespeare, Melville and Joyce, etc.

Friday, October 28, 2011

Wealth Redistribution and Keeping your Computer Safe

A few days ago, I posted a lengthy item concerning my feelings toward Classical South Florida.  If you wish to review it, just check the posting dated October 26, 2011.  If you missed them, I encourage you to go back and read the past postings.  They are always available.

Also, as of this writing, Jack’s Potpourri was viewed by folks in ten nations over the past seven days.  Ninety-two were in the United States, 28 were in the Netherlands (a teacher must have found that posting on Miro and made a class assignment out of it), two each were in Germany, Kenya, Russia, Singapore and there was one hit each in Hong Kong, Indonesia, South Korea and Moldava.  We get around.

Sixty-eight percent of viewers used Internet Explorer to get here and 16% used Mozilla Firefox.  Windows was the operating system of choice, being used by 83% of viewers while 11% used a MacIntosh operating system.


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Economics 201 – Wealth Redistribution

Planet Earth is a fortunate planet, endowed with a multitude of riches.  Natural resources abound.  Rich soils and agreeable climates produce food for its inhabitants.  The human race has been able to build and develop the planet in a positive manner over the centuries so that, in effect, the sum is worth far more than its parts.  Resources such as straw and mud baked in the hot sun were combined to make bricks in ancient times.  And a brick hut is worth more than mere mud and straw, just as steel girders are worth more than the iron ore and coal from which steel is made.  And that added value can be moved around from person to person. The Egyptian who built that brick hut may have exchanged it for more than the worth of the mud and the straw, and suddenly he had money in his hand to spend on food and clothing, for which he no longer had to scrounge for himself, or even on more straw and mud to build more huts.  And from humble beginnings like these, all of our economic systems developed.

There is plenty of wealth in the world.  Economic problems, in Europe, in Africa, in Asia and of course, in the United States, stem from how that wealth is distributed among the planet’s population.  There are many ways that this can be accomplished.  If this were an ideal world, the Marxist concept of taking “from each according to their abilities” and giving “to each according to their needs” might work. But this isn’t an ideal world and people don’t like to see the fruits of their labor given away to those who for one reason or another didn’t work as hard as they did, or receive less than others for all the work they did because their need was not as great as that of others. Communism works for brainless automatons, but not for real people.  That is why it eventually fails wherever it is tried, as is the case of all kinds of totalitarian socialism.  Its fault is that people will only accept it if it is forced upon them with an iron fist.

The free enterprise system, capitalism, whereby wealth is derived from hard work and putting money to work developing resources, creating profits and increasing the wealth of the world, just like that early Egyptian who had a thriving sun baked brick business did, is another example of how wealth is distributed.  Unfortunately, it often results in situations where there are two kinds of people, “haves and have-nots.”  Often, governments step in to look out for the welfare of the “have-nots,” and with such dependence on government, liberties are diminished. Sometimes, because of the extreme success of the “haves,” the planet’s wealth becomes concentrated in their hands.  On its voyage there, some of it is skimmed off by governments to care for the “have-nots” and some is skimmed off by the banks and the financial industry which acts as custodian for all of this wealth, handles its continual moving around, and cultivates its growth.  But wealth really isn’t necessary for growth to occur in our economic system. The vision of future wealth is sometimes enough to create credit which, for the short run anyway, can accomplish some of the same things real wealth does.

But things can go wrong with this system.  Credit can be granted which cannot be repaid.  The underwater mortgage problem in the United States is an example of this. Remembering that we can have “have” and “have-not” nations as well as individuals, the fragile economies of Greece, Italy, Spain, Portugal and Ireland are examples of this.  Only when these countries started to have trouble paying their bills (interest on the bonds they issued) did the term “sovereign debt” come into common use.  Right now, the world has more wealth that it ever had but it is not in the right places. Too much of it is in the hands of a very few people or controlled by financial institutions and governments which do not want to risk letting go of it.  In Saudi Arabia and some of the Gulf states, a very, very few profit from control of the world’s major source of petroleum.

Redistribution of wealth is what the Arab Spring was all about.  The people who rebelled aren’t ending up with any more liberty than they previously had, but they are looking for a chance to personally get their hands on a bit more of the world’s wealth than they previously had.  The Occupy Wall Street demonstrators in New York, claiming to be the 99%, object to the amount of wealth in the hands of the 1%.  In the eyes of some, we have a socialist system looking out for “banks too big to fail” as well as the truly impoverished with the government guaranteeing a measure of wealth in both situations, while everyone else works within a capitalist system, working or fighting for what they feel is their fair share of wealth. Tea Party adherents basically want less of the wealth in the care of the government and more in the hands of those who worked for it.  Full employment, of course, assures the transfer of wealth to working people in the form of wages and salaries.  Unemployment hinders it.  Where the wealth is and who controls it have been the causes of most of the wars in the history of the planet.  And obviously, It is the reason for bank robberies and burglaries, locally and internationally.

Solving the world’s economic problems comes down to how we are going to redistribute the world’s wealth.  It has to be done, or everything will come tumbling down like a house of cards.  When Europe bails out Greece, enabling that country’s debt to be paid off to some extent, that amounts to redistributing debt from more solvent nations to an impoverished one. And if that redistribution involves bonds held by United States banks, that transfers some of our wealth as well.  United Nations and United States aid to poor third world nations does the same thing. International trade moves wealth around as it has done in the relationship between the United States and China.  When our country’s subprime mortgage problem is ultimately solved, wealth will be transferred from the government and the banks to mortgagors, some deserving and most undeserving of it, whether we like it or not.

The chief economic problem of the next few decades is whether wealth redistribution in the United States and the entire world will take place in an orderly, well thought-out and organized manner or in slipshod, scattershot ways which probably will create even more problems, including wars, than we have now.  The fellow who made bricks from mud and straw never realized the mess he started.

Jack Lippman

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After reading all of that dull stuff, you deserve a break, so here's another of those wonderful girls painted by Alberto Vargas during the 1940s and 50s with some advice for you.


How to Protect Your Computer
(Taken from a Special Advertising Section on this subject in Bloomberg Business Week of October 24)
1.    Keep Your Firewall On:  Firewalls protect your computer from hackers who try to gain access to crash it or steal information.  Software firewalls are widely recommended and come prepackaged.
2.    Install or Update Your Antivirus Software:  Antivirus software is designed to prevent malware from embedding on your computer.  If it detects malicious code, like a virus or a worm, it works to disarm or remove it before it can do serious damage.
3.    Install or Update Your Antispyware Technology:  Spyware is surreptitiously installed on your computer to let others peer into your activities on the computer.  Some spyware collects information about you without your consent or produces unwanted pop-up ads.  Antispyware combats these intrusions.
4.    Keep Your Operating Systems Updated:  Computer operating systems are periodically updated to stay in tune with technology requirements and to fix security holes.  Be sure to install the updates.
5.    Be Careful of What Your Download:  Carelessly downloading email attachments can circumvent even the most vigilant antivirus software.  Never open an email attachment from someone you don’t know, and be wary of forwarded attachments even from people you do.
6.    Turn Off Your Computer:  Many of us leave our computers on 24/7, but a computer that is always turned on is more susceptible.  Beyond firewall protection, which is designed to fend off unwanted attacks, turning the computer off effectively severs an attacker’s connection – be it spyware or a botnet.

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                                               Can anyone tell me what’s a botnet?

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