patrick.net

RayAmerica says

they’ve turned to Hollyweird to “plug the hole.”

typical of the confusion circulating among wingers -- James Cameron has more practical experience with deep submersibles than anyone without a Top Secret classification [edit: clearance].

Honest Abe says

The sad thing about socialism is that if there honest money systems, low taxes

also known as "high land values".

When I was doing research on Norway over the weekend I was quite amazed at the general competence with which its technocrats are running their partially-socialized economy.

The existence and real-world unqualified success of Norway's Eurosocialist system utterly destroys your thesis as you present it here. Even Alberta is trying to learn from the Norwegian example:

"The dismal state of the Heritage Fund is seen by many here as the result of years of mismanagement by successive Conservative governments. 'In some ways, they've had a bit of a bad rap, and in some ways, they deserve a bad rap,'"

http://www.theglobeandmail.com/report-on-business/article972257.ece

and:

"'Alberta would be better served,' said Todd Hirsch, chief economist with ATB Financial, 'if the government laid out a long-term plan of how we're going to deal with the surpluses, and not just for the current budgetary cycle.'

Instead, the focus remains short-sighted -- on keeping taxes low and using the energy windfall to fuel expenditures instead of saving and investing it. Economic booms do end -- as this one will one day. And sadly, Alberta will have nothing to show for it."

http://www.canada.com/calgaryherald/news/calgarybusiness/story.html?id=3eee7692-6b32-45b9-aa79-69078dd10673

Granted, running an economy of just 5M well-educated people with a 3m bbl/day oil production capacity is easier than a nation of 300M poorly-educated idiots scattered from sea to shining sea.

Singapore and Hong Kong are also examples of semi-socialized economies with long-term economic success.

If you want to ruin an economy, just lower taxes. One would think the recent Bush tax cuts of 2001-2003 would be of sufficient demonstrative power.

Does anyone remember the fable of the grasshopper and the ant?

Let's see we've got Honest Abe and RayAmerica in this corner and tatupu70 and simchaland in that corner. Do we need government? I think we can all agree that yes we need government: military, police, firemen, etc. I think the real argument here is do we need a big government nanny welfare state? I'd like to hear tatupu70 and/or simchaland provide a logical argument for it without using your already demonstrated inclination towards sarcasm.

Um, yeah, I'm not for a big government nanny welfare state. I am a Liberal and I like our form of representative democracy and I want it taken back from the corporations. I do believe in having a basic social safety net because we all need a little assistance sometimes. And I believe in workers having rights and being paid a living wage for good work. I also believe in some protection for the environment because, well, I'd like to continue living and eating and breathing and drinking clean water.

And why wouldn't Abe Babe and Rayray have to prove their side with a logical argument? I've yet to read anything logical or rational from either of them supporting their insistence that we should have no government.

So, jkingeek when Abe Babe and Rayray ever pony up and provide rational and logical arguments about anything, I'm game. But don't hold your breath, it may take a while...

There you go again with the sarcasm, you just couldn't post a response without putting in a jab. "don't hold your breath". The whole point of this thread was to point out (I think, correct me if I'm wrong Honest Abe) that the current system is unsustainable. The only way it has gotten this far is by debasing the purchasing power of our dollars with the stealth tax (inflation).

If the system is to be maintained how is it going to be paid for?

jkingeek says

Let’s see we’ve got Honest Abe and RayAmerica in this corner and tatupu70 and simchaland in that corner. Do we need government? I think we can all agree that yes we need government: military, police, firemen, etc. I think the real argument here is do we need a big government nanny welfare state? I’d like to hear tatupu70 and/or simchaland provide a logical argument for it without using your already demonstrated inclination towards sarcasm.

No sarcasm? Now, where's the fun in that?

But seriously, your question is already loaded and shows your bias. No one wants a nanny welfare state. So, if you ask it like that, then it's a strawman.

jkingeek says

There you go again with the sarcasm, you just couldn’t post a response without putting in a jab. “don’t hold your breath”. The whole point of this thread was to point out (I think, correct me if I’m wrong Honest Abe) that the current system is unsustainable. The only way it has gotten this far is by debasing the purchasing power of our dollars with the stealth tax (inflation).
If the system is to be maintained how is it going to be paid for?

What "system" are you refering to?

People who prefer limited governmernt seem to prefer autonomy, good will, mutuality, initiative, industry, self-reliance and seek from a competent government protections that insure freedom of opportunity, freedom to live by his own choices and the ability to relate to others by mutual consent without oppressive government intervention.

Others seek a dominant governments's guaranteed safety, security and dependency over their enitre lives. They demand through the power of the state to redress all trama, injustice, helplessness, and humiliation. This is achieved through countless laws, rules, statutes, civil codes and regulations that indulge their impulses yet exempt them from the proper obligations of a mature adult. They seek a society that is heavily regulated, controlled, shaped, manipulated and administrated by the Modern Parental State (aka the Nanny State).

The state gains traction by daming "villians" for exploiting people yet deny they are manipulating people. They become ruthless while appearing innocent, devious while appearing truthful, obstructive while appearing helpful.

Their over-riding thought appears to be: "TO MAKE THE WORLD HAPPY, WE MUST INFORM THE MASSES AS TO WHAT IS GOOD FOR THEM, AND REGULATE THEIR LIVES FOR THEIR OWN BENEFIT", because they must be incapable of doing so for themselves.

Federal debt tops $13 trillion mark
Spending reaches an alarming $4.9 Billion per day
By Stephen Dinan
9:38 p.m., Wednesday, June 2, 2010
The federal government is now $13 trillion in the red, the Treasury Department reported Wednesday, marking the first time the government has sunk that far into debt and putting a sharp point on the spending debate on Capitol Hill.
Calculated down to the exact penny, the debt totaled $13,050,826,460,886.97 as of Tuesday, leaping nearly $60 billion since Friday, the previous day for which figures were released.
At $13 trillion, that figure has risen by $2.4 trillion in about 500 days since President Obama took office, or an average of $4.9 billion a day. That's almost three times the daily average of $1.7 billion under the previous administration, and led Republicans on Wednesday to place blame squarely at the feet of Mr. Obama and his fellow Democrats.

tatupu70 says

The entitlements such as welfare, social security, medicare, etc. are overwhelmingly supported by the general public

"Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history. There is a tiny splinter group, of course, that believes you can do these things. Among them are H. L. Hunt (you possibly know his background), a few other Texas oil millionaires, and an occasional politician or business man from other areas. Their number is negligible and they are stupid." -- Eisenhower

RayAmerica says

At $13 trillion, that figure has risen by $2.4 trillion in about 500 days since President Obama took office, or an average of $4.9 billion a day.

We're only 9 months into his first fiscal year, which began Oct 1. Way to lie with statistics, Ray.

At any rate, budgets can't be turned around on a dime.

Public debt was $8.5T on June 1, 2010 and $7.5T on Oct 1, 2009, a rise of 13.3% over the first 9 months that Obama is on the hook for.

Over the previous nine months, from Jan 1 2009 thru Sept 2009, public debt rose nearly 18%.

So Obamanomics has already reduced the run rate nearly 500bps or over 25%. Praise the Lord!

While the above numbers are true, they don't really explain things.

The Bush tax regime established 2001-2003 really f---ed up this country's finances. Bush inherited a public debt of $3.3T in 2001 and ran it up to $6.3T on the day he left office (with that other $1.2T waiting to hit as his last budget year unfolded over FY09). His fiscal policies managed to more than double the public debt. Golf claps around for that managerial brilliance.

Publically-held national debt, real terms in ( )

1961: $238B ($1.7T)
1969: $278B ($1.6T) -- Kennedy/LBJ lowered the debt
1977: $550B ($1.9T) -- Nixon/Ford raised the debt
1981: $790B ($1.8T) -- Carter lowered the debt
1993: $3.25T ($4.76T) -- Reagan/Bush raised the debt
2001: $3.3T ($4.01T) -- Clinton lowered the debt
2009: $7.5T -- Bush raised the debt

Granted, the respective Congresses deserve a great deal of the blame/credit for the growth/decline of the national debt

Interested thread.

I live in a region that is solidly conservative, probably has plenty of people who are firm supporters of the Tea Party movement and politicians in the makings of Ron Paul.

When i listen to them, there is merit in some of what they say and I can respect that, but what I find most interesting is that these same types, mainly farmers and ranchers who are the grass rooters or america, are the same ones who are the first in line when a government farmer welfare program comes along, and you better get out of the way or you would darn near get ran over when the line forms by them.

People love to sing the praises of limited government, programs, etc. until it comes home to hit there wallets. How many of those Tea Party types at the rallies protesting government involvement in there lives don't find it kind of ironic that they are receiving Medicare at the same time, and would fight tooth and nail to not have it repealed or have the age for Social Security raised?

I also find it kind of funny that all this "hatred" of government spending didn't seem to go into full wacko mode until Obama came into the office. I figure those types were probably too busy at the time waiting for there government checks during the Regan and bush years...

Cain, you're right in a lot of what you say, IMHO. Thats part of my point - government subsidies, farmer welfare, hand-outs, write-offs, etc. should be limited to safety net standards only. Why on earth, for example, pay people NOT TO GROW CORN, or wheat, or anything else for that matter. See what I mean? Too much of the government's nose in other peoples business - most always with the opposite result as intended (aka "unintended consequences").

In my opinion there was an ample outpouring of anger (rightfully so) on Bush's fiscal mismanagement. However Obama QUADRUPLED (if I'm not mistaken) the spending of Bush. Thats probably the origin of today's current "unhappiness".

Honest Abe says

However Obama QUADRUPLED (if I’m not mistaken) the spending of Bush

LOL. What do you think the chances of you being mistaken on this assertion are?

You'd probably be way wrong about that, too!

Bush took the $300B defense budget of 2001 and turned it into a $700B monster.

Bush recklessly added Medicare Part D in a brazen pandering to seniors and price support to Big Pharma.

Bush took the $640B of discretionary spending of 2001 and left us with a $987B request for 2009, plus another $800B cherry-topper to patch the f---ed up financial system his minions had allowed to wreck itself 2002-2007.

Bush's last budget called for $3.1T in government spending plus the bailout resulted in a $3.9T expenditure.

Obama's first budget calls for a $3.6T expenditure.

Thats probably the origin of today’s current “unhappiness”.

yup, never underestimate the power of agit-prop on fools.

Obama-Bush-Obama-Bush..... I'm so sick of it. Politicians are politicians! The point here is that government spending is spiraling out of control. I think just about everyone reading this agrees. If you don't, I'm sure you'll speak up.

Well, I googled: OBAMA QUADRUPLES BUDGET, the very fist article was titled "After Tripling Deficit in 2009, Obama On Track to nearly Quadruple Bush Deficit in 2010". So apparently my memory did serve me correctly. As bad as Bush was, Obama is even a bigger spender. Yup, that's probably the origin of a lot of today's current unhappiness.

What's that TV Quiz show, "Are you as smart as a 5th (6th?) Grader"? I bet all the kids would be able to answer this question correctly: CAN YOU SOLVE A DEBT PROBLEM WITH MORE DEBT?

I would say this: Never underestimate the stupidity of Congress - none of them is as dumb as all of them.

Honest Abe says

Well, I googled: OBAMA QUADRUPLES BUDGET, the very fist article was titled “After Tripling Deficit in 2009, Obama On Track to nearly Quadruple Bush Deficit in 2010″. So apparently my memory did serve me correctly. As bad as Bush was, Obama is even a bigger spender. Yup, that’s probably the origin of a lot of today’s current unhappiness.

Well, if the interwebs says so, then it must be true...

tatupu70, I'll let you have that one.

Honest Abe says

CAN YOU SOLVE A DEBT PROBLEM WITH MORE DEBT?

http://en.wikipedia.org/wiki/Triffin_dilemma

you may get your gold regime someday, Honest Abe : )

Awesome! $250 Billion SDRs "created" and distributed by IMF....

Honest Abe says

Well, I googled: OBAMA QUADRUPLES BUDGET, the very fist article was titled “After Tripling Deficit in 2009, Obama On Track to nearly Quadruple Bush Deficit in 2010″. So apparently my memory did serve me correctly. As bad as Bush was, Obama is even a bigger spender. Yup, that’s probably the origin of a lot of today’s current unhappiness.

The budget and the deficit are not the same thing. The budget is what is spent, the deficit is the shortfall between spending and revenue. Read what you posted again. Obama quadrupled the deficit not the budget.

Obama and Bush both are out of control spenders.

Troy says

We’re only 9 months into his first fiscal year, which began Oct 1. Way to lie with statistics, Ray.

I love the way you lefties always accuse people of "lying." Uhhh, I copied and pasted the article, so it wasn't me that said anything. Furthermore, he says nothing in it about "fiscal year" as you claim. What he does say is that we, I mean Obama, is spending at a $4.9 BILLION per day clip. I really wish you people would READ and try to comprehend what is being said before you rush off and call someone a liar. It would go far in establishing at least some semblance of credibility on your part.

bob2356 says

but his spending is still outrageous

how so? Be specific.

Was it the $50B bailout of GM?

Obama inherited a system that was in total meltdown Jan -> Mar 2009. What the RayAmericas of the world intentionally refuse to understand is that the nation pushed up a $5T plus debt bubble on itself 2002-2007, and this debt bubble was fueling CONSUMPTION 2004-2006 to the tune of $400B or more a year.

It's still all going to blow up badly. The government has some power in determining when, where, and how we crash, but not if.

Anybody who thinks they have a workable answer to the problem is talking out of their ass.

OK, here are some ideas for fixing America:

(1) Prohibit deficit spending

(2) Make it easier to start and operate a business

(3) Put an absolute restriction on money growth

(4) Privatize all government entities that are operating at a loss

(5) Eliminate all redundant government programs

(6) End the Federal Reserve System

(7) Reestablish sound money

(8) Outlaw stimulus and bailout plans

(9) Reduce military spending to no more than 5% higher than China's military budget

(10) Only taxpaying US Citizens should have the right to vote.

Plus I've got at least 25 more ideas to add to the 10 above.

Political leaders are the ones that need regulation. America needs a rigid structure of fiscal responsibility built on a solid foundation of truth, trust, the rule of law, and sound money principals. Unfortunately, our morally weak leaders (and those that support them) would much rather make policy that erodes our financial stability and passes the financial burden to future generations who are too young to vote or haven't even been born yet. I think that is unacceptable and morally bankrupt.

Others will think that is perfectly acceptable...those are the ones who are OK with the socialization and destruction of America as we know it. UGH !!

Interesting thread. I have a hard time envisioning the end of fiat money, as the government requires taxes to be paid with dollars. If you go totally grey market in your personal economy, I suppose its possible. A couple of thoughts:
1. Local currencies. These usually boil down to a base unit of the currency being equivalent to a man hour of work. This, of course, does not account for specialization and differentiating between more valuable outputs from the work being done. At the same time, it's very applicable to every day life. I've never hired a babysitter, but my wife and I go out a least once a month. We have an informal co-op with two other couples and rotate babysitting duties. This exchange of services is not taxed (Yet!). But imagine, if you will, plugging into the more formal structure of organized co-operatives throughout the world. Now imagine, instead of their 'accounting' system being just internal to the co-op, there is a hierarchy that allows an interchange between co-ops (using the Intertubez). At a certain point, you can imagine the flow of both goods and services without fiat money changing hand (at which point, I'm sure, the gov't steps to value those goods and service and get their cut).
2. BTU dollars. This, I don't think, has been practical because of mankind's ability, in the past, to exploit increasingly concentrated stores of energy. In another words, EROEI (energy returned on energy invested) has steadily increased as humans progressed from an agrarian culture to an industrial society. At this point, though, its hard to envision EROEI getting any better than the soon to peak Ghawar oil field in Saudi Arabia. We've got a lot of fat to cut with efficiency measures, but, I could imagine (at a certain point in the future) when 'energy units' are no longer an inconsequential part of goods and services produced. In another words, the value of an energy unit rises to the point where a 'BTU dollar' could become a medium of exchange. No idea what that looks like, though. But hey, if we're telling the majority world to cook with biogas from their waste, no reason households here couldn't become energy producers. Perhaps this looks like charging our neighbor's electric car with solar panels (or a fuel cell) and getting a credit in a networked accounting system (instead of on our PG&E bill).

Cool. But, I don't see where it says she's grossing $500K a year...

I see. Not bad for re-selling Chinese made plastic. Assuming the stuff is made in China as nearly everything is these days.

http://www.zerohedge.com/article/guest-post-extend-and-pretend-guide-road-ahead

thoughts?

jkingeek says

Assuming the stuff is made in China as nearly everything is these days.

Chinese are trying to move up the ladder and avoid having to make this meaningless plastic crap. . .

http://www.nytimes.com/2008/08/01/business/worldbusiness/01factory.html

jkingeek says

thoughts?

I agreed with the apparent need to monetize about $5T in present dubious assets held by the banking system.

People here by now are probably aware of my shorthand analysis I take from the Federal Flow of Funds Report:

L.100 Households and Nonprofit Organizations -- Home mortgages

Q301: $5.264T
Q407: $10.538T

That is a clean doubling in mortgage debt yet prices are back to 2001 levels in many if not most bubble areas, even though interest rates are at historical lows and Federal insurance limits are around double what they were in 2001.

This tells me that there's $5T of bad debt still out there. That sounds like a lot but it's $100K over 50M households.

http://research.stlouisfed.org/fred2/series/CMDEBT?cid=97

This ZH opinion quickly falls into the libertarian rubbing of hands about the coming collapse and either overextension into state socialism or the destruction of the modern welfare state and return to rugged-individualist minarchy.

Both of those are certainly possible futures, the third is that we continue bumbling on. The one great thing about the immense inefficiencies in our health care system is that there is still immense savings to be wrung out of it, on the model of Canada or Japan, should we manage to "lose freedom" on his simplistic chart and actually start cracking down on the theftastic margins medical providers are running on us.

We also need the return of the Clinton tax brackets. These start coming back soon enough I guess.

We're likely to get smushed by our need to buy oil in a future with declining production and rising consumption by China, a China that can easily double its buying power by revaluing the RMB rate. Alaska's oil is basically earmarked for China's consumption now, and if & when they do a 2X revaluation they'll get twice the oil for the money. Twice the iron ore and coal from Oz, twice everything from everywhere. The average Chinese person may not have a pot to piss in still, but the top 300M people in that economy have got it made, and I'd rather be them than us at this juncture I think (assuming I could be one of that top 300M).

I'm leaning toward the thesis that the 2001-2002 recession was trying to tell us something about the sustainability of offshoring our productive base, and we used the housing boost juice to put off the pain, said pain we are feeling now.

It is a complicated picture, a mess, and I don't think anyone has any idea where this is going to go this decade.

"Americans are least supportive of government when it redistributes income and penalizes success. An April, 2009 survey by polling firm Ayers-MaHenry, asked registered voters which of the following statements came closer to their view:

(1) Government policies should promote fairness by narrowing the gap between the rich and poor, spreading the wealth, and making sure that economic outcomes are more equal.

(2) Government policies should promote opportunity by fostering job growth, encouraging entrepreneurs, and allowing people to keep more of what they earn.

Whereas 31% opted for (1), 63% chose (2). Even when explicitly offered more government services, Americans prefer less government." The Battle, How the Fight Between Free Enterprise and Big Government Will Shape America's Future - by Arthur C. Brooks

We've been brainwashed good, no denying that. Meanwhile,

http://research.stlouisfed.org/fred2/series/CMDEBT

and

http://research.stlouisfed.org/fred2/series/FYGFDPUN

$11T bubble since 2001 can fake a lot of people out about how close prosperity is for them.

It's all downhill from here. 'Tis sad, but a people get the government they deserve. As for us, we are largely a nation of self-absorbed idiots.

Well, you appear to be truely disturbed. Review the post on "WHAT IS A DOLLAR" Fri, 11 Jun 2010 at 4:48pm. The description of PERSONALITY DISORDERS sounds a lot like you.

It describes irrational liberal thinking, feelings of envy, jealousy, inferiority, revenge, and victimization. Other traits are obsessive pursuit of control and regulation as well as infantile claims to entitlements and compensation. Personal responsability is absent.

Obviously the Nanny State is your utopia...MOMMY.

Nomograph says

A person who starts name calling is a person who has run out of ideas. You sound like a six year old child.

Perfect illustration of liberal/leftist hypocrisy. Thanks for your contribution Nomo.

Honest Abe says

It describes irrational liberal thinking, feelings of envy, jealousy, inferiority, revenge, and victimization.

Very well put. Another wise man once summed it up by saying "liberalism is a mental disorder." You're both on the same page.

Do you have anything to contribute beyond your hatred of liberals?

Troll.

Utopia only exists in the mind of irrational liberals. The beauty of freedom is equality of opportunity, not equality of results. Thats why libs hate freedom, the results are not equal. MOMMY -ITS NOT FAIR - HE'S GOT MORE THAN ME !!!

Honest Abe says

The beauty of freedom is equality of opportunity, not equality of results. Thats why libs hate freedom, the results are not equal. MOMMY -ITS NOT FAIR - HE’S GOT MORE THAN ME !!

LOL. Statement 1 contradicted by statement 3, separated by a strawman.

Quality argumentation there, Tex.

I hate freedom? No. I do, however, dislike trolls who believe that they know how I think just because they've branded me as a lib. I also wonder why, if abeabe likes freedom so much, he hasn't felt free to set up his own forum upon which he and like-minded people can further their agenda without having to deal with us pesky free-thinking types.