Not too far away from Graham County is a casino that provides entertainment, food service, lodging and gambling. Total revenue from these operations exceeds $500 million annually.
The entire resort is packed with masked-up, socially-distanced and temperature-cleared folks, having a good time. The casino is owned by the Eastern Band of Cherokee Indians and operated by Caesars Entertainment, a company with $10 billion in annual revenue.
A bit further away is another casino, known as the New York Stock Exchange.
The 226-year-old institution lists approximately 2,400 companies with a market cap approaching $35 trillion. That is 18 times the recent $1.9 trillion COVID relief bill passed by Congress. There are hundreds of millions of shares traded daily.
To keep this simple, the stock exchange is a casino of extraordinary proportions. Thirty years ago, this columnist attended a breakfast sponsored by Northern Trust Bank. The speaker prophesied that the Dow Jones Industrial Average daily closing – which was then just breaking $1,000 – would be $30,000 in our life time. We all scoffed and laughed.
Well guess what? The average closed at nearly $33,000 a few days ago. That gamble paid off, if you could risk a lot of ups and downs along the way.
Most of the serious downs were not caused by the fundamentals of our capitalist system. The financial crises which led to the greatest drops were caused by diminished regulatory authority. We ignored the causes of the savings and loan crisis until banks started to fold. We did the same thing with mortgage bundling, wherein garbage loans were wrapped up in few good ones.
Here’s the rub. Until recently – when the stock market casino goes bad – members of Congress of both political parties step in a bipartisan way to save the day allegedly for the common folk. Trillions of taxpayer dollars are allocated to save jobs, stave off bankruptcies, avoid evictions and keep food on the table.
This is called socializing losses. It means that taxpayers eat the cost of the bailout. Yet, when the stock market inevitably recovers, the owners of those stocks reap the gains and pay nowhere near a fair share of taxes. This is called privatizing gains. It is how we have allowed ourselves to be governed over the past four years.
Maybe that’s why so many people are angry about everything. No one they support at the polls has stepped in to socialize their losses.
In fact, they were unanimously opposed.
Roger Carlton writes a bi-weekly column for The Graham Star. He can be reached via email, rcarlton57@hotmail.com.