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Originally Posted by Cuepee
Gross.
So the middle class tax payer again provides a subsidy to the uber rich corporations and their owners by making the price gauging more palatable.
What a great con as corporations say to Politicians, 'oh don't worry about the high prices and our profits, just use medicare money to pay most of it'. And they do.
(I could not access your link FWIW)
No, prices are set by what people will pay. The various government subsidies mean they can pay more. They could not charge it, if people were not able to pay it. Oddly, your doctors visit is cheaper if you pay cash, but the obsession over catastrophic health issues has led people to pay insurance companies, and subsequently you have an entire block of voters who now want that subsidized, then complain about high prices.
I don't get the obsession with Scrooge Mcduck. Like, very few companies and people are "uber rich". Most of their wealth is entirely on paper, and dependent on what someone will pay for the stock they own. Further, and for the most part, an enormous amount of "profit" it is reinvested/spent. That means is being filtered back into the economy. You can talk about evil corporations, one of most effectual US corporations, spends 97% of its revenue (Wal-Mart). In other words, that money is going to people other than the company, or it's shareholders. United Health Care has a net profit margin of 3-5%, so 95-97% of its revenue is being spent. This is the case for an overwhelmingly large amount corporations. This is the benefit of capitalism. Also, the "subsidies" actually allow companies to spend more of their revenue. A business plan operates on percentages. In other words, Walmart will reinvest/spend 97% of its revenue, no matter what. It could be one dollar, or one trillion. The people receiving that revenue are the ones really getting a subsidy, which are mostly the small cap companies, or small business types, or, upper middle class. Finally, unless a company issues a dividend, most of the profits are also reinvested. Investors typically don't like a large cash balances, because it's not earning anything. They rather have the company spend that money to grow the business. Most investors make money by the price of the stock, not the profit a company makes, not directly anyways. Investors want scale and growth, at 3-5% net profit margins. That's what makes their stock increase. In mature companies, most investors don't care about an increasing profit margin, and look more towards revenue.**
This is where you need to take a look at institutional investors, i.e. 401K runners, which in most cases, are just investing money for the middle and upper middle class.
**Tech companies are an exception to this, i.e. Apple. It's one of my prime examples of a spoiled culture. Like, 45% of all US smartphone users, have one the highest priced cell phones on the market. This is where the subsidies are going. The iphone in your pocket, or any other number of consumer goods and services that improves your standard of life. They allow you to afford those things.
Last edited by itshotinvegas; 07-01-2020 at 10:50 AM.