Socialism is evil. Tell my why I am wrong. (and let's keep it civil)

[Vort]

12 minutes ago, Godless said:

Yes, I'd rather make $20K a year than $2M a year because that way I don't have to pay as much tax. Do you have any idea how ridiculous that sounds?

Good thing I said nothing even approaching such mendacity.

[David13]

11 minutes ago, Godless said:

 

Yes, I'd rather make $20K a year than $2M a year because that way I don't have to pay as much tax. Do you have any idea how ridiculous that sounds?

 

 

 

I have no desire to tax the rich into poverty. A higher tax rate for the wealthy isn't going to prevent them from making exponentially more money than me. All I'm saying is that if I'm going to take 15% of someone's income, it makes more sense to take it from the millionaire than the janitor. The millionaire can pay that and still be rich. The janitor would have to scrounge up two or three months worth of rent payments to meet that demand.

Maybe you know about making $20k a year, but obviously you don't know anything about making $2M a year.

And secondly, oh, so you don't believe everyone should pay their "fair share"?!

That seems a bit unfair, doesn't it?

dc

[Guest MormonGator]

9 minutes ago, David13 said:

The other problem they never address is, there is no such thing as equality.  No one is ever equal to any one other. 

Totally agree on this. That's why my college football career never took off. Athletically speaking, I am not equal to Johnny Manziel. 

A sign of maturity is realizing that not everyone is equal in all skills and abilities. 

[unixknight]

14 minutes ago, Godless said:

Objectively speaking, it makes more economic sense to place a higher tax burden on the wealthy simply out of virtue of the fact that they can afford it.

I find a statement like this to be fallacious, and to be honest there's nothing objective about it.  My income puts my family in the 3% of earnings in this country.  When I was complaining about how my healthcare costs rose after Obamacare became law, I was told "you can afford it so stop complaining."

Just what, exactly, gives anyone the right to decide what I can afford, much less make a blanket statement like "they can afford it?"  It's another one of those meaningless marketing statements.  No, I actually CAN'T afford the increases.  I live in an apartment that's too small for my family, but the area I live in is expensive.  My car is a 1995 Chevy Lumina.  It's literally old enough to drink, if it were a person.  I commute an hour each way to work, and I pay for health care not only for myself and my wife, but our 2 kids as well as the 3 I have from a previous marriage.  Oh, and I'm helping my 2 oldest with their college expenses as well.  My last 3 raises were below the cost of living increases which means my buying power is less than it was 4 years ago despite my making more money.  I can't afford to buy new parts for my CPAP machine because they're ridiculously expensive, and to get my healthcare to cover part of them I have to go do another sleep study and get another prescription for another machine.  I have a broken tooth that my dental coverage will pay $350 toward a $5,000 bill on so I've been chewing my food on just the left side of my mouth for about 3 years now. 

I don't just hope Bernie Sanders doesn't get elected, I PRAY for it.  The tax increases he would trigger will break me. 

Do millionaires have these same problems?  I doubt it, but I'm still not comfortable presuming that people can just afford arbitrary tax hikes just to make my sense of "social justice" feel better and take the sting out of what is, essentially, institutionalized class envy.

14 minutes ago, Godless said:

Because of this, I'm actually not fond of the "fair share" term. That implies equal, which I'm not necessarily in favor of. I'm all for allowing the rich to stay rich, but to expect them to share a proportional tax rate with a household bringing in $20K a year is unrealistic, imo. The system has to be rigged against someone, why not the ones who can afford to pay a little more?

Why?  At a 15% tax rate, a person who makes $20,000 annually pays $3,000.  A person who brings in $2M would be paying $300,000 in tax.  I fail to see the problem.  The rich person is already paying 100 times more tax dollars, and they're not paying enough?  This is bizarre to me.

14 minutes ago, Godless said:

People say that this is punishing people for being rich, or disincentivising people from trying to reach higher tax brackets. But I challenge you to find anyone in my tax bracket who wouldn't love to be in Warren Buffet's tax bracket. If I had a mansion and a private jet, I doubt that you'd hear me complaining about having to pay more taxes than someone in the middle class.

Out in the real world, nobody faces an actual opportunity to jump from the middle class to Warren Buffet.  There is a disincentive.  I've known people who have turned down promotions at work because the pay raise would put them in a higher bracket and bring  minimal additional benefit to their income with a huge increase in stress and workload.  When people do get an opportunity to do better, it's in baby steps.

And it's absolutely punishing people for being rich.  It isn't just the additional money they pay, it's the fact that nobody acknowledges that guys like Warren Buffet generate jobs and keep money moving, which also allows for banks to do things like give mortgages and car loans.  Where do you think that money comes from?  Aunt Jeannie's retirement account?  No.  It comes from accounts held by rich people and corporations.  That money is used to start businesses, buy houses, keep the economy growing.  I'd say the rich are doing plenty as it is.  It isn't just about taxes paid.  Does a middle class earner contribute anything to economic growth on the scale the rich do?  Do the poor?  Of course not.  And we don't expect them to.  The rich do a lot more than people realize just by being rich, whatever their intentions are, and still politicians win elections by promising to hurt the rich to make the middle class and the poor feel better.

[NightSG]

13 minutes ago, unixknight said:

Out in the real world, nobody faces an actual opportunity to jump from the middle class to Warren Buffet.  There is a disincentive.  I've known people who have turned down promotions at work because the pay raise would put them in a higher bracket and bring  minimal additional benefit to their income with a huge increase in stress and workload.  When people do get an opportunity to do better, it's in baby steps.

And therein lies the problem; eventually one of those baby steps pushes you just into the next tax bracket, or out of an assistance bracket, and for a long time (assuming you're able to stick with it long enough to push upward through it) you're working harder to be less well off than you were.  That's a very strong disincentive to improve by any normal means, and for some reason, people who hit big lottery wins or other windfalls very rarely seem to remain at even the most basic level of wealth it should afford them.  (1% of $1M is $10,000, so a $5M after-taxes windfall, invested even fairly poorly-but-safely would be a return of $50k/yr.  Not a bad income for not working, and assuming there's even another half mil in there to spend immediately, you should be able to eliminate personal debts, buy a good house and car, and provide for a fair amount of other needs...remember; your income is now entirely independent of location, so you don't need that house to be in the DC suburbs, and the car isn't going to have to commute daily either.)

This, IMO, is where a flat tax and a smoothly adjusted exit from assistance programs would remove these disincentives.  I've known people who would lose $2,500 in benefits if they earned $1,000 more in a given year.  Much more productive to split the difference and have them receive $0.50 less in benefits for every additional earned dollar; increasing their earnings would then reward their work by always allowing them to have more while still meeting the same needs as before, and simultaneously wean them off the benefits.  The same for people hovering right at the top edge of a tax bracket; flat tax would eliminate the penalty for earning more.

[Sadliers]

1 hour ago, NightSG said:

More to the point, socialism is at base, an economic concept.  Economics deals only with scarcity and want.

That may be the case but one cannot overlook the other factors of reality. It is those factors that make socialism a very poor choice for economics. Those factors include the existence of God, that we are here to try to return to Heavenly Father and help others do the same, and that each person is unique with thoughts, feelings, and a root motivating belief that causes them to behave differently.

For example, what happens if one person decides they don't care about anyone else and so they'll try to hord everything they can while their neighbors starve to death? Who is to determine and define that it is wrong for them to do so? "Because you have to care for others". Who said? Who is to determine what is right and what is wrong? Why should one care what the wants and needs of another are? And, more importantly, who believes they are the ultimate authority to make that determination when they are only another face in the crowd? By itself any economic concept cannot exist alone in the human world without defining what is right, wrong, proper, or improper. But then who makes that determination? Why should one, or many, think they have authority to determine that for another? Without having established a basis for right and wrong then there is no wrong in letting another starve to death and there is no wrong in depriving another of those things that are scarce even if they are essential for life. There is also no wrong in using socialism to enrich one's self at the peril of the rest that are forced to be a part of it.

You mentioned law enforcement. How can there be laws unless right and wrong have been defined? Yes, that's what laws attempt to do but what makes one think they are above another in order to make the laws? So right off the bat we see there is no true equality in socialism since someone will believe they are somehow more superior than others and that should qualify them to dictate how the others are to behave.

[David13]

It's important to have a God.

And it's important for us to know that we are not that God.

Most of us know and understand that.  But some have to be told.  "There is a God, and you are not him."

dc

[LeSellers]

1 hour ago, NightSG said:

socialism is at base, an economic concept.

Economics is a subset of Praxeology.

Both study the intelligent actions of men, the intelligent, purposeful actions of men. So, to say the socialism is an economic concept is not quite accurate, it is a praxeological concept.

Socialism does not exist in an economic vacuum. It must exist in a society (hence the name), only part of which is economic.

Even if we ignored that, everything associated with economics affects those things beyond its narrow reach. if I buy a newspaper, that 25¢ becomes an education for the newsboy, a new pair of shoes for the editor's wife, and a contribution to the writer's church. Shoes are economic things only at the sales counter.

Lehi

[Guest]

2 hours ago, Godless said:

Objectively speaking, it makes more economic sense to place a higher tax burden on the wealthy simply out of virtue of the fact that they can afford it. Because of this, I'm actually not fond of the "fair share" term. That implies equal, which I'm not necessarily in favor of. I'm all for allowing the rich to stay rich, but to expect them to share a proportional tax rate with a household bringing in $20K a year is unrealistic, imo. The system has to be rigged against someone, why not the ones who can afford to pay a little more? People say that this is punishing people for being rich, or disincentivising people from trying to reach higher tax brackets. But I challenge you to find anyone in my tax bracket who wouldn't love to be in Warren Buffet's tax bracket. If I had a mansion and a private jet, I doubt that you'd hear me complaining about having to pay more taxes than someone in the middle class.

1) I've known people who simply do not want a higher wage because they'd have to pay more tax.  They somehow feel like they are willing to pay a certain percentage of their wage.  But over a certain amount, they figure, "why bother? I'm not getting much for my work after taxes." 

Yes, I'm very aware of how ridiculous that sounds.  But there are indeed people who think like that.

2) Other people I've known don't want a higher wage, not because of tax bracket per se, but because of certain tax incentives that get lost at higher wages.  I myself have lost the child tax credit because I'm beyond that wage line.  But I did other things to offset that.

3) The lack of understanding of the disincentive is tremendous among those who believe in the progressive tax structure (meaning, progressively higher percentages with higher incomes).  Understand this:

• The poor work to earn enough, so they can spend until they can't spend any more and then spend a bit more.
• The middle class work to not lose.
• The trust fund child (I'm using the term loosely) just relaxes and does whatever they want as long as the money lasts.  Some go broke despite the trust fund.
• The wealthy work to win.

The wealthy mindset is not just about having lots of money so they can finally relax.    The wealthy mindset is about constantly being driven and getting that edge over the other guy.  This can be done in a very Darwinian manner, or it can be done in a sense of fair competition.  But it is always about doing more, doing better, to ultimately get more and be better.  The successes like Buffet and Gates are perfect examples of this.  They keep going and going and going.  There is a drive there that will not be stopped simply because "they've made it".

That is why so many celebrities go broke.  They still have a poor person's mentality with a huge bank account.  Think like a poor person, it doesn't matter how much you make.  Think like a rich person and you will always get more.

They keep going to win.  But when we have a 70% tax bracket (France) how many are going to be driven to get that much more edge when most of it is going to the government?

Will Smith was talking about how much he supported a progressive tax system.  Tax the rich!!!  But he was being interviewed on french television where they informed him that his tax bracket would be 70% in France.  He was absolutely stunned, declaring,"70%!!! uhm. duh. err.  God bless America!"

 

Edited April 12, 2016 by Guest

[Guest Godless]

1 hour ago, NightSG said:

And therein lies the problem; eventually one of those baby steps pushes you just into the next tax bracket, or out of an assistance bracket, and for a long time (assuming you're able to stick with it long enough to push upward through it) you're working harder to be less well off than you were.  That's a very strong disincentive to improve by any normal means, and for some reason, people who hit big lottery wins or other windfalls very rarely seem to remain at even the most basic level of wealth it should afford them.  (1% of $1M is $10,000, so a $5M after-taxes windfall, invested even fairly poorly-but-safely would be a return of $50k/yr.  Not a bad income for not working, and assuming there's even another half mil in there to spend immediately, you should be able to eliminate personal debts, buy a good house and car, and provide for a fair amount of other needs...remember; your income is now entirely independent of location, so you don't need that house to be in the DC suburbs, and the car isn't going to have to commute daily either.)

This, IMO, is where a flat tax and a smoothly adjusted exit from assistance programs would remove these disincentives.  I've known people who would lose $2,500 in benefits if they earned $1,000 more in a given year.  Much more productive to split the difference and have them receive $0.50 less in benefits for every additional earned dollar; increasing their earnings would then reward their work by always allowing them to have more while still meeting the same needs as before, and simultaneously wean them off the benefits.  The same for people hovering right at the top edge of a tax bracket; flat tax would eliminate the penalty for earning more.

It seems unlikely that we could ever create a flat tax that would be a minimal burden to the poor AND create positive national revenue. If I'm wrong, I'd love to see the numbers. Maybe the solution is to raise the upper threshold of the lower brackets. Maybe we should decrease the rate of increase in those lower bracket transitions. Maybe we should do both. Again, I don't pretend to know the perfect tax solution. It seems like someone will lose to some extent regardless of what we do.

And to clarify, I'm not opposed to corporate tax credits that encourage job growth (especially if it discourages overseas outsourcing). I'm not saying that corporations should receive no tax credits, but I want to make sure that they're receiving them for the right reasons, not just because they helped Senator X get into office. I'd also love to see some tax incentives for small businesses. On the local level, small businesses are a vital stepping stone for workers entering a new trade (and yes, I'm probably a bit biased because I work for one). 

[zil]

10 hours ago, zil said:

Yes.  Do you think that in that day, anyone will be compelled to participate?

I want to change my answer. As Vort pointed out, United Order is not the same as Law of Consecration.  When I said "yes", I was thinking of the Law of Consecration.

[Str8Shooter]

On 4/12/2016 at 10:28 AM, anatess2 said:

Before this topic gets too deep in the weeds, you first need to define Socialism.  There are many ways to implement it and a lot of times, that's what people refer to - a certain method to implement its principles instead of the principles themselves.  So, what exactly are you referring to when you say Socialism?

Let's define it for this discussion as the form of government kind of socialism.  Socialism as in this country is socialist and that country is not.  I feel that is what most of the church leaders that I listed were referring to.

Edited April 14, 2016 by Str8Shooter
clarification

[Str8Shooter]

11 hours ago, Vort said:

Capitalism is the law of the jungle. It is heartless, ruthless, cold-blooded, and it leaves in its wake a bloody trail of mangled bodies. It is the strongest prospering, the weakest getting eaten, and everyone else trying to stay out of the way. Those who think that capitalism is some celestial law deceive themselves. Capitalism is the ultimate embodiment of competition. And don't count on capitalism being "fair". It is nothing of the sort.

I look at capitalism as the law of people with morals.  It works perfectly when you have God fearing people with high morals.  When you have people that are ruthless, cold-blooded, etc, then yes, it is a jungle.  The lack of God, the lack of morals, is the root of the problem.  Capitalism cannot work without real charity.  It simply will not work, and then socialism begins to ooze in like The Nothing.

[Guest]

DEFINITION: Socialism is the government control of "non-public goods".  When taken to the ultimate level, it becomes something similar to Fascism or Nazism because it requires that man exercises force on man to take his goods and/or services and provide them to another.

Some will say that is the same as the United Order is a form of socialism.  To an outsider, possibly.  But to us who believe in the Prophetic mantle, it is a theocracy.  The difference is that God owns everything to begin with.  So it is perfectly within His rights to take some of it back to give to others as He sees fit.  The government does not own our stuff.  So to take it by force is theft.  That single principle is what makes the difference between a moral and righteous system and an immoral and evil one.

PUBLIC GOODS: What is a "public good"?  In an economic sense, this does not simply refer to a desire to benefit society (that's a sociological sense).  It refers to goods and services that by their very nature benefit much more than the single person who wants it.  Military defends an area, not just an individual.  Defending borders means that everyone in the nation is automatically defended without regard to individual needs, desires, or characteristics.

NON-PUBLIC GOODS: Socialism is invoked when government has increasing control over goods which primarily benefit an individual.  Medicine is one such.  While one can argue secondary effects and so forth, the PRIMARY beneficiary of health care is the individual receiving it.  Thus government control of healthcare is socialism.

THE CONSTITUTION: I also believe that there can be some things that are still non-public goods, but there is overwhelming practicality to the point it's almost a need to have the government run it.  Such items should be so carefully thought out and meet with such overwhelming approval that it should only be done through a long and difficult process such as passing a Constitutional Amendment.  The Constitution initially set up post-roads and mail service as a government function.  And I have no problem with such roads being left open to the public for driving on.  SCOTUS justified it in other ways which I thought were ridiculous.  It is much simpler to say that it is a post road and when not being used as such, the public can certainly travel on it because it belongs to the public anyway.

Such items can change over time.  During Franklin's time, it was considered a civic duty to come out and be part of the fire bucket line if a building in town caught fire.  Later he created the volunteer fire department.  Gradually government took that role instead of asking for volunteers.  With more money, new more efficient methods of fighting fires were invented.  Now that technology has brought some prices down and the economy has grown, new private fire departments grew.  And many of them are much more effective than public fire departments.

Mail is being squeezed out by FedEx, UPS, et al.  

NATURAL MONOPOLIES: One school of thought says that so called "natural monopolies" should be socialized.  The other school of thought says that there really is no such thing as a natural monopoly (nor any monopoly of any kind) except those that are government sponsored to begin with.  I'm about 80% leaning towards the 2nd school of thought.  I'm finding more and more that those things I used to think of as natural monopolies really were that way only because they were government sponsored.  But I'm still having difficulty believing it about roads.

In Texas, electricity is on a brokered system and keeps the power on with very low rates.  Water is now being run on a similar system in many areas of the country.  So, there are many things that really aren't natural monopolies after all.  The one common characteristic of truly natural monopolies is when it is a service that requires property or specialty.

EXAMPLES:

1) When there was a change from vacuum tubes to transistors, then to integrated circuits, there were methods of manufacture that were trade secrets.  Some were simply better than others who tried to reverse engineer it.  So, for a time, there were natural monopolies.  As the secret got out, there was still a lag (however brief) between knowing the secret and applying the secret.

2) I own a pipeline that delivers water to a subdivision.  Because I own it, you cannot claim that pipeline as a public good.  But how are you going to get water to the subdivision without my pipeline that was laid at the initial construction of the subdivision?  You'd have to dig up the road (get govt involved) then route around everything that is underground and install new pipes.  Are you going to do that for just one customer in a subdivision?  No, you'd have to have an entirely new system that supplied it to most or all of the houses.  If you own the pipeline, do you own the property that the pipeline sits on?  If so, how is anyone going to route their pipes around it?  

The pipeline situation is a difficult one to get around without government regulation of something -- even if it is simply the requirement to "sell" an easement.  So, until technology figures something out, this is going to be a highly regulated good or it will be a natural monopoly.

The only other argument I've heard is that piped water still has to compete with water trucks or other methods of water delivery.  I say that's like saying that Ford (in 1900) doesn't have a monopoly on transportation because there are bicycles and trains and carriages...  I see it as valid, but a poor argument.

Edited April 13, 2016 by Guest

[anatess2]

6 hours ago, Str8Shooter said:

Let's define it for this discussion as the form of government kind of socialism.  Socialism as in this country is socialist.  I feel that is what most of the church leaders that I listed were referring to.

Well, see... this doesn't make sense.  Because Socialism is not a form of government.  Communism is a form of government that is based on Socialist Principles.  Socialist Republics is another and Democratic Socialist is a different one too.  There are a whole bunch more different ones including Socialism in a Dictatorship.

If we refer to Socialism as the Economic Principle that is juxtaposed with Capitalism as the Economic Principle... then we might get closer to clear.

Nobody ever refers to Capitalism as a form of government.

 

[anatess2]

1 hour ago, Carborendum said:

DEFINITION: Socialism is the government control of "non-public goods".  When taken to the ultimate level, it becomes something similar to Fascism or Nazism because it requires that man exercises force on man to take his goods and/or services and provide them to another.

 

And here's a definition...  But that's not all Socialism.

Socialism is separate from a political government.  Of course, one can use the society's political government to manage the system but they don't have to.  So you can pretty much have Socialism with ANY form of government, including a Theocracy.

 

And this is why I think Socialism in this discussion HAVE TO be defined.  Because, for some reason, in America, words seem to have different meanings than the rest of the planet.  Socialism like Liberalism and Feminism are all used very very differently around these parts.

Now, it would be fine if you put forth an "American" definition of Socialism and we can stick with that.  But, when you're only redefining Socialism and then compares it to Capitalism which didn't get the same redefinition treatment, it becomes very very confusing.

Edited April 13, 2016 by anatess2

[unixknight]

15 hours ago, Godless said:

It seems unlikely that we could ever create a flat tax that would be a minimal burden to the poor AND create positive national revenue. If I'm wrong, I'd love to see the numbers. Maybe the solution is to raise the upper threshold of the lower brackets. Maybe we should decrease the rate of increase in those lower bracket transitions. Maybe we should do both. Again, I don't pretend to know the perfect tax solution. It seems like someone will lose to some extent regardless of what we do.

I think if we want the national revenue to stay in the green the first step is to start making a serious effort to reduce waste and unnecessary spending.  As long as the Government can keep going back to the well and raising taxes,  they'll never make any real effort to reduce waste and eventually, when it's impossible to raise taxes further, there'll be a collapse.

15 hours ago, Godless said:

And to clarify, I'm not opposed to corporate tax credits that encourage job growth (especially if it discourages overseas outsourcing). I'm not saying that corporations should receive no tax credits, but I want to make sure that they're receiving them for the right reasons, not just because they helped Senator X get into office. I'd also love to see some tax incentives for small businesses. On the local level, small businesses are a vital stepping stone for workers entering a new trade (and yes, I'm probably a bit biased because I work for one). 

Agreed.

[Sadliers]

When one speaks of "the rich" there is inherently an issue of coveting going on. The wealth of one is if no concern to another, and when they make it their concern it is because they are coveting the wealth. That is a direct violation of the commandments. And the sin is exasperated when they attempt to have the wealth taken from that person through various means, especially by the government.

[unixknight]

9 minutes ago, Sadliers said:

When one speaks of "the rich" there is inherently an issue of coveting going on. The wealth of one is if no concern to another, and when they make it their concern it is because they are coveting the wealth. That is a direct violation of the commandments. And the sin is exasperated when they attempt to have the wealth taken from that person through various means, especially by the government.

Good point, and I think that cuts right to the core of it.  Socialism isn't a form of government but it is a way of using government force to control wealth.

[Vort]

1 hour ago, Sadliers said:

And the sin is exasperated

It's so exacerbating.

Edited April 13, 2016 by Vort

[Sadliers]

42 minutes ago, Vort said:

It's so exacerbating.

Gotta love autocorrect!

[Traveler]

Let’s get one thing straight - governments are not evil.   In fact governments are given for the good of mankind.  It is the leaders that abuse authority that are evil - the powers of government are only the vehicle for evil or good men.  But it is my personal observation that those that want to hold positions of responsibility in government tend mostly towards those with evil intent.

 

The Traveler

[Traveler]

Conservatives claim big government is bad but think big business is good???  Big business and big government is just the different sides of a coin in the pocket of very evil men.

Liberals claim to want to help the poor – but their programs have failed badly and they do not care; proving that their programs and the power and influence to control programs are more important to them than is any actual helping of the poor.

Sadly I think the best candidate is a socialists.  I did not say that the socialists is a good candidate – far from it.

Should business be regulated – yes!!!  If a company has a layoff – the CEO should be fired and at least no raise and management should not be allowed bonuses – any bonuses or management pay increases under such conditions should be taxed at 110%

 

The Traveler

[unixknight]

17 minutes ago, Traveler said:

Conservatives claim big government is bad but think big business is good???

Yep, all Conservatives believe the exact same things.

17 minutes ago, Traveler said:

Should business be regulated – yes!!!  If a company has a layoff – the CEO should be fired and at least no raise and management should not be allowed bonuses – any bonuses or management pay increases under such conditions should be taxed at 110%

Who fires him?  The Government?  The owners?  What if the owners don't want to fire the CEO?  What if it isn't the CEO's fault?  

And how do you tax something beyond 100%?

[anatess2]

40 minutes ago, Traveler said:

Should business be regulated – yes!!!  If a company has a layoff – the CEO should be fired and at least no raise and management should not be allowed bonuses – any bonuses or management pay increases under such conditions should be taxed at 110%.

And here's another one.  Painting all CEOs as a cardboard box character.  This is just another flavor of wealth envy.

I'll give you a real-life example:

Winn-Dixie Grocery Stores hired Peter Lynch as the CEO and a few years later filed for Chapter 11 Bankruptcy.  Peter Lynch got millions of dollars for bonus.

The Florida newspapers excoriated Lynch, employees - especially the ones that got laid off - went screaming to the press, etc. etc.

Well, guess what.  Winn-Dixie got in the mess they were in from years and years of not being able to adjust to the demographics of their customer base.  This is not just a CEO thing... This is a Board of Directors thing and a market competition thing.  Publix takes the niche of the upper crust and Walmart SuperCenters took the lower crust.  Winn-Dixie was squeezed in the middle - not quite good enough to be Publix but not quite big enough to get Chinese products to compete with the price guarantees of Walmart.

So, they hired Peter Lynch to solve the problem and offered him $10 Million bonus if he can bring them back to black after years of being red.  Peter Lynch took the job, analyzed the situation, decided the best way to do so is to lay off a bunch of people then file for Chapter 11 to stay the creditors as he cleans up the place and reorganizes.  It took 3 years but Winn-Dixie remained in business even as they closed some stores and opened others.  They went in the black while still in bankruptcy and Lynch got his bonus per contract.  The press screamed and Lynch told Winn-Dixie they can keep his bonus until he gets them completely through the bankruptcy.  They got out of bankruptcy with a leaner and profitable profile, the Davis' who owned the place lost a bunch of money, Lynch got his bonus which he took a bunch of and invested in Winn-Dixie stocks as he believed in its profitability in the future.  The Davis' then decided to sell Winn-Dixie to Bi-Lo which crashed their stocks.

Peter Lynch earned every singly penny of that bonus and deserves a whole bunch more and it is so sad that his good name and character got skewered by a sensationalized media who has no desire to understand what it takes to run a business... or a bunch of liberals who like to skewer CEOs because they're rich.

Edited April 13, 2016 by anatess2