The Long Cold Winter

[can't sit still]

It's long been accepted that taxes have a 3X negative multiplier on the economy.

[ygmir]

yeah, that tax debate......

It's a good illustration, between the mindset of "freedom vs socialism", IMHO.

those that want gov. to be the source of all things, know their only source of revenue is taxes.......and so, want more, so, gov. can give more away......but, they want the taxes paid by someone else.
But, it gives them the feeling of being "safe", and, at times, the self gratification of thinking "their taxes" are helping others less fortunate.
They don't see, that, taxation diminishes the reward/work relationship for entrepreneur types....and, they are the ones who drive the economy.

Those who want to be more self sufficient/responsible, see the taxes as interfering with their ability to provide for themselves, and, (at their discretion), help others less fortunate.
They see taxes as punishment for success, and, then, tend to find ways not to pay taxes, and, at times, just give up, between taxes and regulation.

all the above, is merely my opinion.....that, and 2.69 will get you a cup of coffee....

[Trishntek]

I firmly believe people would be willing to pay taxes if two major things happened.

First, and I agree with you 1durphul that spending must stop! If the citizens see responsible frugality with public funds they are willing to contribute to the effort.

Second, the Federal tax system should be based upon spending. A sales tax makes much more sense, because it encourages saving and is spread throughout society based upon ability to buy instead of ability to earn.

People are willing to come together when there is a mutual goal. Look at the frenzies displayed in sports! The same objectives can be achieved with public projects when the taxpayers see and actually experience a benefit.

[1durphul]

A few posts ago Trish you said (I'm just gonna sum it up with tongue in cheek.)

ZOMG Reaganomics were teh awesomez.

Reagan's tax philosophy was a good short term fix to an immediate problem. There are problems with trickle down economics though, very real problems that 30 years later are now tearing at the fabric of our society.

I firmly believe people would be willing to pay taxes if two major things happened.

First, and I agree with you 1durphul that spending must stop! If the citizens see responsible frugality with public funds they are willing to contribute to the effort.

Wouldn't that be wonderful?

Second, the Federal tax system should be based upon spending. A sales tax makes much more sense, because it encourages saving and is spread throughout society based upon ability to buy instead of ability to earn.

People are willing to come together when there is a mutual goal. Look at the frenzies displayed in sports! The same objectives can be achieved with public projects when the taxpayers see and actually experience a benefit.

Wouldn't it be wonderful if the government could say "Hey, we want to build a national high speed rail system. In order to do it we could spend 2 Trillion, or even better we'd love to see every American volunteer a week over the next two years to help build the safer portions. If we get your support it would only cost 700 billion."

So back to trickle down economics. The problem is that (can't-sit-still has pointed out) under Reaganomics the wealth has become highly concentrated at the top. Let me suggest instead that Government needs to be treated more like a balancing act. Too much wealth goes to any one side and you're going to see a collapse. Currently way to much wealth has gone to the top 1%, and they are not sharing (ie, trickling down) their wealth.

Now, normally in our Free Speech loving society this wouldn't have been able to happen to the degree that it has happened today. Under normal conditions sometime around the mid 90s when the real effects of globalization were being seen on the manufacturing workers there would have been a loud outcry by the working class, and voting box revolt against those politicians deemed to be sending their jobs overseas.

In 1985 the Fairness Doctrine (http://en.wikipedia.org/wiki/Fairness_Doctrine) was repealed by the FCC. The result has been a working class that has been fooled into believing a very pro-corporate agenda by a corporate owned media. Men like Rush Limbaugh, and Sean Hannity who, due to the end of the Fairness Doctrine, are on 24 hours a day, and are the only broadcast source of political opinion in some places, have managed to create an entire ecosystem of conservative ideology. They promote TV (Fox News), Websites, and Books that back up erroneous, false, or fabricated statements. The websites, TV, and Books, reciprocate by promoting the conservative radio talkers.

In the end the result is that we don't have a large enough portion of the middle and working class that knows anything other than what they hear all day through the radio in their car. Now you can tell me that the media is "liberal" but that just tells me you're parroting what you've heard from the circular logic platform the conservatives have created. Seriously, next time you are near a radio count the number of "conservative" talk stations on the AM dial, and then count the number of "liberal" talk stations on the same AM dial. Chances are it is going to be a ratio on the order of (conservative:liberal) 40:1. In many places you'd have to aggregate multiple markets to get even one liberal station bringing that ratio closer to 100:1. Even worse in those 100:1 markets you might find 5-10 stations simultaneously playing Rush Limbaugh, or Sean Hannity. Now clearly there is no real need for 5-10 affiliate stations all playing the same radio show at the same time, yet, that is what we have today. Conservative radio owners are willing to split their audience by 5 to 10 ways, how could that possibly be more profitable than being the only station for 300 miles playing the highly rated Ed Shultz show? The answer is that it isn't more profitable, it does however service the conservative radio network owner's personal agenda of indoctrinating those who are hurt the most by conservative ideology.

So in the early 90's when there should have been an outcry, instead the working and middle class said "please sir, pay me less, use me until you find a way to toss me aside for cheap third world labor." All because starting 5-7 years earlier radio stations on the AM dial became platforms for exclusively conservative thought. And since AM is the farthest reaching of the two radio bands, that meant the rural areas which were naturally conservative to start, were now not getting -any- balance, and hadn't been for several years. Twenty five years later and that eco system of conservative ideology means we have a large percentage of the population (double digits) that probably haven't read or heard a fully factual news report since the mid 1980s.

[ygmir]

1durphul:

hhhhmmmmmm, how can the wealthy not be "sharing"?.....do you mean as in "charity" or, do you mean by buying houses, cars, electronics, etc? What, then, are they doing with their money, if not spending or investing it? Are not such actions, exactly, what drives the economy, and creates (private sector) jobs?

What is the alternative, to "trickle down"? (I don't know much about economics, so, this is a serious question).

as to radio:
If, one assumes most stations are "for profit", and, if one type program, brings them the most revenue, why wouldn't they play that? I don't see it as a "vast right wing conspiracy" of radio station owners. I see it as "more listeners, equals more advertising profit". Just business.
(no, I don't think ALL decisions there are based on profit, I'm sure ideology comes into play, but, if it didn't make money, I don't think they'd do it as big as you imply)

The dial is free to turn.

And, certainly, there is plenty of left wing television, movies, and, printed media?
If, the "Ed Schulz" show is so highly rated, why is it not played?
I'd say, it's not so popular, that's why.

And, if radio is the most effective media (by your implication), then, I'm sure there are plenty of left leaning "rich" people that would use it as a platform, in the same manner you describe

People want to always make it a "us vs them" thing.......and, I suppose, it sort of is. But, I'd also submit, it's the manifestation of two (or more) ways of viewing and dealing with issues. Two people may well see a problem, and, have completely opposite ideas as to how to address it.
And, both may well be workable.
It doesn't make one or the other "bad", for differing.
And, to me, the interesting thing is that they are both, often, after the same outcome.......

......"Now you can tell me that the media is "liberal" but that just tells me you're parroting what you've heard from the circular logic platform the conservatives have created".......

How is that "parroting", any more than:

......."Seriously, next time you are near a radio count the number of "conservative" talk stations on the AM dial, and then count the number of "liberal" talk stations on the same AM dial. Chances are it is going to be a ratio on the order of (conservative:liberal) 40:1. In many places you'd have to aggregate multiple markets to get even one liberal station bringing that ratio closer to 100:1. Even worse in those 100:1 markets you might find 5-10 stations simultaneously playing Rush Limbaugh, or Sean Hannity. Now clearly there is no real need for 5-10 affiliate stations all playing the same radio show at the same time, yet, that is what we have today. Conservative radio owners are willing to split their audience by 5 to 10 ways, how could that possibly be more profitable than being the only station for 300 miles playing the highly rated Ed Shultz show? The answer is that it isn't more profitable, it does however service the conservative radio network owner's personal agenda of indoctrinating those who are hurt the most by conservative ideology.".......

is parroting "liberal view points"?

The idealism you profess, is nice, but, seems unworkable.

[Trishntek]

Sooooo why did AirAmerica fail financially if the people are so hungry for a left-sided view? They had the same opportunity and the backing of many of the 1% of which you speak. Yet they did not get the audience necessary to be viable. One would think if there is a demand, there would be sufficient financial support.

But then I'm sure you believe the success of the right-leaning radio guys is based upon corporate donations and not the viability of the programing due to demands. The beauty of the free-market system is,,, given the choice,,, people support the sponsors of what they want to listen to on the radio. Kind of a vote with their business. Here locally, other left-leaning radio programs have been offered when certain shows were discontinued. They simply did not succeed because nobody listened to them.

[1durphul]

Sooooo why did AirAmerica fail financially if the people are so hungry for a left-sided view? They had the same opportunity and the backing of many of the 1% of which you speak. Yet they did not get the audience necessary to be viable. One would think if there is a demand, there would be sufficient financial support.

Funny you should ask. Ed Schultz actually had a discussion about this once on his show. Apparently many radio stations that picked up Air America had formerly been right wing talker stations. None of the station's employees changed, and neither did their ad sales tactics. Since we're talking about "profit" that is the first place we should be looking. Air America's biggest issue was an inability to sell ads, not listener numbers. It turns out that these ad sales teams would go to Republican fundraisers, and events, to find potential local ad buyers. And they continued to do this even after becoming a liberal station. It turns out that you have to retrain your ad sales team to transition from conservative, to liberal, talk radio.

But then I'm sure you believe the success of the right-leaning radio guys is based upon corporate donations and not the viability of the programing due to demands. The beauty of the free-market system is,,, given the choice,,, people support the sponsors of what they want to listen to on the radio. Kind of a vote with their business. Here locally, other left-leaning radio programs have been offered when certain shows were discontinued. They simply did not succeed because nobody listened to them.

Trish this goes back to the ad sales team for a conservative station trying to sell air time to conservative business owners during liberal shows. Of course it failed. In addition, why would a station with 22 hours of conservative talk shows expect 2 hours of liberal to do well. What is the lead in? How does that 2 hours impact the following conservative show? It would be stupid for a program manager to try and run a liberal show in the middle of a 20-22 hour day of conservative talk.

Let's imagine this scenario with music instead:

It turns out that LIVE105 the local alternative rock station, has decided to air soft jazz for two hours a day, from 10-11 and from 4-5. How big an audience do you think that soft jazz show is going to get? Do you think the LIVE105 ad sales team is going to be able to sell ads during those two hours when all their normal advertisers are geared to 18-25 year olds?

How about another scenario:


LIVE105 decides to go 100% soft jazz. Yet keeps it's sales team, and the ad sales team isn't told they should start attending jazz festivals to make new contacts. Instead they continue going to alternative rock events put on by record labels promoting new artists. Do you think they're going to sell many ads?

---

Since we're talking about "market demands" we need to consider that the market is not the size of the listening audience, as much as it is the ability to sell ads. If your ad sales team doesn't adapt to the new format, you can be certain it isn't going to be a profitable change despite listener numbers.

Hell, you see the same sort of thing with websites. If you have a website with huge traffic flows, unless your ad team knows how to sell an ad, they can still go under.

[Trishntek]

Sooooo why was Air America not viable on satellite? They were 24/7 there and still had no audience.

Of course the evil business environment is to blame! They actually exist to make a profit. Profit is made by offering something in demand. It is difficult for me to understand how anyone going into business will cast blame on everyone but themselves for failure. Whathisname needs to simply suck it up and accept the fact that the audience didn't exist.

[1durphul]

Sooooo why was Air America not viable on satellite? They were 24/7 there and still had no audience.

Of course the evil business environment is to blame! They actually exist to make a profit. Profit is made by offering something in demand. It is difficult for me to understand how anyone going into business will cast blame on everyone but themselves for failure. Whathisname needs to simply suck it up and accept the fact that the audience didn't exist.

Profit in this case means offering something in demand to businesses willing to advertise on the content you're providing.

Air America wasn't on Sirius, that I know for sure. I bought a Sirius satellite radio because their literature explicitly stated they would have Air America. Once I got the radio running, guess what, they didn't. That really pissed me off.

I can only imagine that starting a radio network is an expensive undergoing. And it isn't one that is failure proof, no matter which format.

So, I live in San Francisco. Even here in SF there is ONE and ONLY ONE liberal AM talk radio station. (There is one other AM station which I would classify as moderate.) So I found this http://www.sfgate.com/cgi-bin/article.c ... io_am2.DTL 960 is the one liberal station.
There are about 30 stations on that list, and here is the breakdown:

Christian/Conservative talk: 13
Liberal: 1
Misc (foreign language, pers dev, news only): 10

Now you cannot tell me that in the bay area there are more conservatives than liberals. Especially not 13 times as many.

[can't sit still]

YGMIR, there was mention of the rich not spending their money. Imagine if Bill Gates found himself with a cool $ billion in his piggy bank. he could;
1. invest it inequities where it would be put to work as productive capital.
2. loan it to startups that would produce new products.
3. build himself a expensive house
4. invest it in the bond markets where the money would multiply but, essentially be removed from the productive economy.
5. invest in GOV bonds that would pay GOV parasites who produce nothing.
If the money is removed from the productive part of the economy, it doesn't trickle down.

Our GDP is only $ 15 trillion but, "we" have several hundred $ trillion in bonds and instruments. They are outside the productive economy.
The most extractive problem is interest. There is little understanding of the effect of compounding interest. Both the Congressional Budget office, the BIS and the IMF agree that debt service will take 100 % of the U.S. budget.
Here is a series of vids from a professor that very clearly explain the effects of compounded growth. He is speaking about pop growth, but it is equally valid in speaking of interest growth.
There is NO exit from the problem. Even a default will wipe out the investments of the bond holders. There is NO possibility of payment.
http://www.informationclearinghouse.inf ... e25458.htm
I should have added a link. http://towneforcongress.com/economy/the ... pictures-1

[ygmir]

but, why is money, invested anywhere, taken out of the "productive market"?
In that, at some point, people make their profit, and, buy stuff......invest, or, build stuff.......don't they?
All these thing "rich" people buy, employ us "lower echelon"
dwellers, it seems to me.

I'm not saying, to further enrich, the wealthy, by any other than fairness.......
if, they do something well, and, make a bundle of money, well, good for them.
They'll buy the house, that, I make the stone work for.......

I don't understand, why, "trickle down" doesn't work.
And, don't see how you could "trickle up" money.
Other, than, to just give it to people who can't or won't earn it, and, let them buy stuff...........
The problem I see with that (communism), is, it seems it'd take the incentive to do well and take risks, to get "ahead".

I'm very much the economics neophyte.........

[Trishntek]

Sooooo why was Air America not viable on satellite? They were 24/7 there and still had no audience.

Of course the evil business environment is to blame! They actually exist to make a profit. Profit is made by offering something in demand. It is difficult for me to understand how anyone going into business will cast blame on everyone but themselves for failure. Whathisname needs to simply suck it up and accept the fact that the audience didn't exist.

Profit in this case means offering something in demand to businesses willing to advertise on the content you're providing.

Air America wasn't on Sirius, that I know for sure. I bought a Sirius satellite radio because their literature explicitly stated they would have Air America. Once I got the radio running, guess what, they didn't. That really pissed me off.

I can only imagine that starting a radio network is an expensive undergoing. And it isn't one that is failure proof, no matter which format.

So, I live in San Francisco. Even here in SF there is ONE and ONLY ONE liberal AM talk radio station. (There is one other AM station which I would classify as moderate.) So I found this http://www.sfgate.com/cgi-bin/article.c ... io_am2.DTL 960 is the one liberal station.
There are about 30 stations on that list, and here is the breakdown:

Christian/Conservative talk: 13
Liberal: 1
Misc (foreign language, pers dev, news only): 10

Now you cannot tell me that in the bay area there are more conservatives than liberals. Especially not 13 times as many.

I have no idea why, if those numbers are accurate, there is the imbalance you claim. Are those descriptions your opinion? Or do those stations actually define themselves as you have related? There are many levels of liberalism and conservatism. I'm just wondering if it isn't more of a relative comparison. Those numbers you state do indeed demonstrate an imbalance. But radio stations pay big bucks to know what audiences want. It is simply too competitive of an industry to ignore the preferences of the listener.

[1durphul]

I have no idea why, if those numbers are accurate, there is the imbalance you claim. Are those descriptions your opinion? Or do those stations actually define themselves as you have related? There are many levels of liberalism and conservatism. I'm just wondering if it isn't more of a relative comparison. Those numbers you state do indeed demonstrate an imbalance. But radio stations pay big bucks to know what audiences want. It is simply too competitive of an industry to ignore the preferences of the listener.

My point is more that it is less about the preferences of the available audience, and more about the preferences of the people purchasing ads. There are plenty of magazines, publications, and clubs in the world that owe their existence to an advertiser that prefers to advertise with them over another publication that has a larger audience. Talk radio is no different.

As for the radio stations, I have listened to them all. I enjoy the occasional listen to right wing christo-facist nut radio, especially if I'm getting sleepy while driving and need something to piss me off enough to stay awake.

[1durphul]

I don't understand, why, "trickle down" doesn't work.
And, don't see how you could "trickle up" money.
Other, than, to just give it to people who can't or won't earn it, and, let them buy stuff...........
The problem I see with that (communism), is, it seems it'd take the incentive to do well and take risks, to get "ahead".

I'm very much the economics neophyte.........

In one scenario you are giving money to people capable of moving that money off shore and outside the US economy. [trickle down]

In the other scenario you are giving money to people who can only spend it within their local communities, and at worst at a corporate chain store. [trickle up]

If you really want to dump money into the economy you'll tax the wealthy and then give cash to the poor. The poor aren't going to save it, they're going to buy things, and services. That is why they are poor. And all those things and services they buy mean profit for the people at the top. Profit they actually have to earn by manufacturing goods, and employing people. Don't want to give it to people who aren't working? Fine, give them the money in the form of tax free wages for people making less than 150k per year. That would really flood the US local and national economies with cash.

It is somewhat laughable that you equate people who live off of trust funds and investment banking as "earning their money" but people who work hard grunt labor as not earning it.

[ygmir]

thanks for that quick primer on economics.......I see, that, both "up" and "down" trickling, could work, or not.......and, neither is perfect.

I don't see where I equate "rich" with trust funds and investment banking,
and, I don't see where I said people who work hard don't earn their money
I think, or tried, to imply, that, if you get rich, by working hard, nothing is wrong with that.

...........I'd propose, "the rich" are a varied group. And, if a person makes a ton of money, however they do it, in business, or, winning the lotto, and decide to invest....is that "bad"? You seem to think so.
Is not investing, a way to put money into other businesses, allowing them to grow and prosper, and, all that goes with that? Should a person not be allowed a "return" for investing, or risking money on them?
Even "trust funds".........well, if you made a ton of money, would you not want your kids to benefit?........Sure, some "trustafarians" are pieces of crap......but, find a group where no one is..........

[thisisthatwhichis]

In one scenario you are giving money to people capable of moving that money off shore and outside the US economy. [trickle down]

In the other scenario you are giving money to people who can only spend it within their local communities, and at worst at a corporate chain store. [trickle up]

Wow, I'm not an Economist, but that was the strangest bastardization of trickle-down economics that I have ever heard......


This is kinda fun to watch.............Carry on.....

[can't sit still]

You have to look at trends to see how much wealth the banking sector has withdrawn from the producing economy. The banking sector used to be a small component of the economy. Lately, it's been growing like crazy. How can the financial sector grow disproportionately to the productive sector?
http://en.wikipedia.org/wiki/File:NYUGD ... lShare.jpg
The financial sector doesn't produce wealth,, it only deals in debt. Due to increases in efficiency, prices are generally falling. Also, due to wage arbitrage from low-wage countries. Why would a mature producing economy need a fast-growing debt sector?

Look at agriculture. It is FAR more efficient; http://www.gourmetspot.com/know/farmerfeeds.htm
Manufacturing is far more automated too. There is no justifiable demand for the huge amounts of credit /debt that the financials have created.
Fractional reserve banking and Keynesian economics demand an ever-increasing supply of credit / debt. The bankers create it and set it aside as instruments. There is NO way to infuse that much debt into the economy. That doesn't stop them from trying. Why do you think that they actively pushed the "liar loans"?

The M.O. of the banks was to make bad loans to satisfy the demands of Keynesian credit growth. Then, they insured those loans with CDOs and other BS. That all blew up because they overdid it. Now, that they have no interest in making bad loans, credit is frozen. There is a mountain of about $ 750 trillion that is held off to the side. With a $ 14 trillion domestic economy, it couldn't be absorbed anyway.

The bankers held all the profits off in instruments to multiply them as fast as possible. The productive economy is just to slow and inefficient for them. That is why the financial sector has grown so disproportionately. But, in the end, it's all vapor if it can't realistically be redeemed.

GOV et all idiots continue to pursue Keynesian BS even though it can never work. Amazingly stupid and blind. Same as great depression 1.0 ,, great depression version 2.0 is showing a huge money supply contraction;
http://www.telegraph.co.uk/finance/econ ... mulus.html

[Trishntek]

I don't understand, why, "trickle down" doesn't work.
And, don't see how you could "trickle up" money.
Other, than, to just give it to people who can't or won't earn it, and, let them buy stuff...........
The problem I see with that (communism), is, it seems it'd take the incentive to do well and take risks, to get "ahead".

I'm very much the economics neophyte.........

In one scenario you are giving money to people capable of moving that money off shore and outside the US economy. [trickle down]

In the other scenario you are giving money to people who can only spend it within their local communities, and at worst at a corporate chain store. [trickle up]

If you really want to dump money into the economy you'll tax the wealthy and then give cash to the poor. The poor aren't going to save it, they're going to buy things, and services. That is why they are poor. And all those things and services they buy mean profit for the people at the top. Profit they actually have to earn by manufacturing goods, and employing people. Don't want to give it to people who aren't working? Fine, give them the money in the form of tax free wages for people making less than 150k per year. That would really flood the US local and national economies with cash.

It is somewhat laughable that you equate people who live off of trust funds and investment banking as "earning their money" but people who work hard grunt labor as not earning it.

As far as the foreign placement of American dollars, you would have to consider the $45 Billion per year immigrant workers export each year.

Giving money to the rich? I was always under the impression that money was earned (i.e. time and effort). Giving money to the poor does nothing but keep them working less and asking for more. When everyone has an interest in public funding, everyone has an appreciation for the investments made.

When those who pay see only those who receive wanting more, it causes resentment and a conflict of interest for everyone. The only difference is those who pay are seeking ways to pay less and those who receive are seeking ways to receive more.

The rub is when those who receive cultivate a sense of entitlement. Those who pay cultivate a sense of resentment. For both parties it encourages less productivity. The poor say, "Why work when I can ride the gravy train?" While the "rich" say, "Why work when my money is just being thrown away by gubmint handouts?"

When speaking of the working poor and less fortunate, that is the purpose traditional charity based organizations. The wealthy will gladly support such organizations voluntarily if they handle the funds responsibly. Certainly they waste it less than gubmint does because they have to earn the trust of their contributors.

Look, before the Federal Reserve existed, money had the backing of tangibles like gold and silver. Some argue there's not enough precious metals in the world for the money in circulation. That is nonsense! I say precious metals are under-valued if that is the case. But in those days, the United States produced 80% of the world's goods with 5% of the population. Since the Federal Reserve was established and entitlement programs have begun, it has been a one-way slide toward bigger gubmint, more debt, less productivity, higher taxes and, bottom line, less liberty and increased tyranny.

[1durphul]

||alot about giving money to the poor being bad||

As I said, give it to the bottom 95% of people who work in the form of not taxing them. That way you aren't handing anything out other than government provided services, like roadway upkeep (good for everybody since it gets workers to work, and allows goods to be delivered), firedepts, police, etc... If I weren't taxed on my wage income I would have an additional $1000-2000 /mo I could spend, starting this month.

(P.S. I do like your salestax idea)

Look, before the Federal Reserve existed, money had the backing of tangibles like gold and silver. Some argue there's not enough precious metals in the world for the money in circulation. That is nonsense! I say precious metals are under-valued if that is the case. But in those days, the United States produced 80% of the world's goods with 5% of the population. Since the Federal Reserve was established and entitlement programs have begun, it has been a one-way slide toward bigger gubmint, more debt, less productivity, higher taxes and, bottom line, less liberty and increased tyranny.

Trish, you're right, of course it is ridiculous that people think there is not enough precious metals on the planet to back currency with. Since the cost of precious metals are variable the minute it became the currency would be the same minute it found it's new sky high value. (Probably overshoot in value actually.)

Now back to the government. We have a HUGE country. We are the third largest country (sq miles, behind russia and canada.) We have lots of shoreline, and interior land, we also have territories, and an international military infrastructure even during peace time. In addition we have a huge national highway infrastructure that benefits everybody. It is no surprise that we have a HUGE government.

I sometime think "we should cut our military" but then I realize that now would be the absolute wrong time to do so. Clearly we are facing a future of scarcity, and with our weakened economic position in the world, our guns are our last resort for maintaining our supremacy and supply.

Add in come the clowns in the form of the Tea Bagging idiots and their call for revolution. You're going to see politicians thinking long and hard about how to get people of fighting [revolution] age off our soil. Last I checked China had a different problem: By 2020 there will be 24 million men without available female mates to marry. That makes 24 million bored men. 24 million men sublimating their sexual urges. 24 million men who the chinese government is going to see as needing to be killed off in a war before they can turn on the government as malcontents. Russia and China's military have been working together a lot lately. An army of 24 million men, even poorly armed, could probably dominate the world. And remember, the Chinese leadership is going to want those men to die, and aren't going to care much how powerful their enemy is.

http://shine.yahoo.com/channel/sex/chin ... ng-566408/

[Trishntek]

When I talk about Big Gubmint, it has nothing to do with physical size of the country and everything to do with the glut of money squandered with no apparent accountability. That is no longer the essence "of the people, by the people and for the people." The hubris of most of our elected officials is without precedent, many of them have never had a job in the private sector or run a business of their own, and they seem to represent lobbyists more than the citizens who elected them.

China has been able to create a million-man army of EIGHTEEN-YEAR-OLD males each year for the last several years. If we aren't careful, we will all be learning Chinese soon.

[can't sit still]

Difficult post to organize. Time marches on and processes evolve.
Slavery was the norm at one time. Wage-slavery was discovered to be more efficient.
Before birth control, large-scale invasions to gain living space were the norm.
As the economy became more consumptive, most wars were for resources, rather than living space. In the carbon age, energy became all-important. Wars for ideology and living space were reduced. Wars for resources, especially energy increased.

The British empire always had a long view of things. They saw that coal would be replaced by oil. It was easier to work with, cleaner and more efficient. They tried early-on for control;
http://www.oilcompanies.net/oil1.htm

The wars for resources are gradually morphing into power grabs of strategic areas. This isn't anything new. Roosevelt couldn't very well declare war on japan so, he blockaded their energy supplies [an act of war] to get them to attack the U.S.

China will never invade the U.S. Like everybody else, they want markets for their products. They can get what they want far more efficiently by out-competing us.

Look at the example of the virus. It attacks a bacteria and does not try to ingest or eat it. It simply injects it's DNA into the bacterium and causes it to produce more virus.
http://textbookofbacteriology.net/phage.html
Nature too works for efficiency.

If the U.S. doesn't have enough of a productive economy to do exports then, it can't very well import. We borrowed to maintain our life style when we should have gone broke from inefficiency. We aren't competitive in production. There are other sectors of the economy but, if they can't generate exports, we have a net deficit related to imports.
The borrowing has reached the limit. The CBO and the GAO say that loan service will take 100 % of the GDP.

How did we get here? In one word,,, INTEREST
50% of the cost of any item is for finance. GOV spends almost 40 % of the GDP. Everything that moves accrues interest [debt] Our debt increased $185 billion last month. That doesn't include private debt.

There is no possible way that the U.S. will ever be competitive in manufacturing if the price of everything is jacked way up by finance and tax.
China doesn't need to invade. It is far more efficient to just keep their finance and tax costs very low until we implode.
The sons of Sun Tzu only needed to keep their finance and tax costs low,,, knowing that natural greed would do the rest.

The problem is that the West has too much debt. To fix the problem, GOV / Banks are going to infuse even more debt. Son-of-stimulus is next. As long as our competition keeps their overhead lower than ours, we'll never escape our import deficit. Every day that the deficit accrues interest is one more day of blood-letting.

Look at the banking sector. They only way that they can have any chance of survival is to have interest-free money. ZIRP. Sooner or later, it will become obvious that the general economy can only survive with interest-free money.

GOV always destroys the money eventually. Interest kills it. Inflation kills it. It always turns to shit eventually;
http://dollardaze.org/blog/?post_id=00405
Ellectronic money is just a more efficient way to kill a currency.

[thisisthatwhichis]

Nice geo-political economic post, CSS.......

Two points I'd like to raise.......

1) Interest is a good thing for a growing economy, unless it's miss-handled, like we have just experienced. You can't rob interest beyond a sustainable means without collapse (and all of those companies should have gone under, IMHO)......

2) China, being Communist, (and the Middle East, being dictators), don't have to play by the Global economic rules of the West....... That might be scarry, one day.............

[can't sit still]

TITWI, I won't disagree with you but, there are still some immutable economic laws.
The U.S.S.R. tried to have a "command economy". Mises predicted about 40 years ago that it would fail. Some of the basics like supply-and-demand,,, motivation,,, efficiency,,, competition,,,, risk,,, etc. These things can't very well be eliminated from the market.

Americans go into Wal Mart and buy stuff without thinking about domestic job reductions. How many Americans listened to Ross Perot when he warned about the giant sucking sound? Now, China is sucking up jobs everywhere;
http://www.thenation.com/article/new-gi ... king-sound

How many Americans went ballistic when "we" gave most-favored-nation trading status to china? When containerized shipping was perfected, it caused almost all manufacturing to be susceptible to global wage arbitrage. How many economists pointed this out? We just stumble along blindly on the path to efficiency and the cheapest price.

BRIC can just bide their time and vacuum up all the manufacturing that is susceptible to global wage arbitrage. China has over $ 2 trillion in their SWF. They don't have much need for our financial services.
They buy our movies and the CIA sells them drugs. What else can we sell them? Even drug sales are suffering; http://www.upi.com/Top_News/US/2010/05/ ... 273752025/

BRIC justs needs to keep working hard. They don't have to do anything sneaky. Congress is on a spending spree.They'll crash things for sure without any outside help.
http://www.foxnews.com/politics/2010/05 ... ing-spree/

[thisisthatwhichis]

Some of the basics like supply-and-demand,,, motivation,,, efficiency,,, competition,,,, risk,,, etc. These things can't very well be eliminated from the market.

Yes, and only if remembered, can a free society dwell with these economics. Many "free societies" forgot some of these truths, to their demise.... so could we......

Americans go into Wal Mart and buy stuff without thinking about domestic job reductions. How many Americans listened to Ross Perot when he warned about the giant sucking sound? Now, China is sucking up jobs everywhere;
http://www.thenation.com/article/new-gi ... king-sound

Don't be afraid, my friend. It's acually a good thing for us. The same thing happens today in America with illegal workers, black markets, but, more importantly "Technology&Productivity". It's in one of your principles above. The difference is the political environment surrounding sucking nations. There is nothing getting to those "Verkers". And their Governments get increasingly stronger with the worlds available resources.

We just stumble along blindly on the path to efficiency and the cheapest price.

Again, see your principles above......


Very solid point of risk, IMHO, with these Western economic failures is it leads un-warranted strength to the countries that can wipe out the economic basis, in a heart-beat, stroke of a pen, and put us in a very uncompromising way.... so to speak...........

[can't sit still]

By "uncompromising way", do you mean,,, over the proverbial barrel?

[thisisthatwhichis]

Well, in some ways, "bend over" comes to mind........


I don't know....... I've seen some kinda bad times, and some really good times...... My crystal ball on this one is as foggy as anyone else's....

[can't sit still]

TITWI, your crystal ball may be foggy. Others are not quite so foggy. Here's a sampling.
"I would recommend you panic" http://www.zerohedge.com/article/hugh-h ... -you-panic

An NBC commentator; Dollar collapse by June http://www.cnbc.com/id/37349789/
Dow ends worst may since 1940. http://www.bloomberg.com/apps/news?pid= ... gUzNgFGKLA

Bond sales fall, worst in 10 years. http://www.businessweek.com/news/2010-0 ... rkets.html

Credit crisis indicators going bonkers. http://www.moneyandmarkets.com/credit-c ... ches-39253

You get the general idea.
Look at Japan. Look at Argentina. There is NO painless way out of this. Those of you who have substantial capital or savings are going to be forced to pay for this. The poor are just going to get poorer. They will lose proportionately less. If you have investments, you would do well to move them to emerging markets. They have far lower credit-abuse exposure.

There is a credible claim that the price of gold will go WAY up to reflect the new LOWER value of currency;
http://fofoa.blogspot.com/2010/05/reflection.html
GOV has proved itself to be incompetent. Banks have proved that greed conquers reason.
Y'all better get serious about about radical preparedness.

[can't sit still]

Well,,, as we flirt with WW III, there is more bad news in the financial world. There is a report that China is in a RE bubble. In China, RE is purchased with CASH. They won't have a RE market crash that is anything like ours.
http://www.bloomberg.com/apps/news?pid= ... qqQA&pos=2

As the focus is shifted from private debt to sovereign debt, this calls into question the viability of paper money;
http://theinternationalforecaster.com/I ... Collapsing
At the same time, people are starting to ask; who will rescue the rescuers?
http://online.wsj.com/article/SB1000142 ... 00816.html

Just to make it more interesting, the charts seem to indicate that a renewed crash is imminent; http://www.safehaven.com/article/16971/ ... e-thought-
"markets appear to be drawing close to another 2008 style meltdown, there will be some big differences between the collapse in 2008 and the one that is looming. In the first place it could be considerably worse"
Bill Gross of PIMCO made a fast exit of the U.S. T-bond market. He has $ 1 trillion under his control. Now another big guy has cut-n-run from the same market;
http://www.bloomberg.com/apps/news?pid= ... uGkE&pos=4

Commercial credit is drying up even worse. That will lead to more layoffs,, sorry.
Now that the "smart money" has run for the exits from treasury paper, there will undoubtedly be many others. It won't be long before the only buyers at treasury auctions will be the FED passing "money" where the ink isn't dry yet.... and the Carribean banks with Cardboard Tecate boxes stuffed full of cash.
Y'all can head for the exits. You know how this movie ends already.

[can't sit still]

This article has a lot of interesting info. At the moment, investors are looking for any kind of safe haven. China is growing and will continue to do so for quite a while. In an effort to attract investors, they have instituted a "Panda" bond;
http://www.businessweek.com/news/2010-0 ... ate1-.html
This is a direct attempt to attract money that is trying to leave the collapsing West. China is also opening it's futures market to foreigners;
http://english.peopledaily.com.cn/90001 ... 02046.html
If the East appears to have a more solid financial foundation than the West, the capital will move. The East is wooing the Eurozone. This will also expedite a power-shift;
http://english.peopledaily.com.cn/90001 ... 01488.html
Things are slipping away fast. Even Wal-Mart is having trouble making money.
http://neithercorp.us/npress/?p=512

It's become painfully obvious that austerity measures shrink the economy and result in lower economic activity and tax revenues. So, the austerity measures impoverish everyone but don't make it easier to repay bonds. Spain is the latest country to learn this fact. The economies have been hollowed out and the banks want their pound of flesh.

[Ugly Dougly]

Xie-xie! Should I move to Shanghai or Beijing then?