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What Is The Economic Future of the United States?

By pb in Op-Ed
Mon May 23, 2005 at 05:59:48 PM EST
Tags: Help! (Ask Kuro5hin) (all tags)
Help! (Ask Kuro5hin)

Anyone can predict the future, but we can't all be right. Some people see a rosy economic future; I fear a bleak one. But all we can do is hope for the best and prepare for the worst. I'm interested in what you think the economic future of the US will be, and here are some of the major issues to take into account; comment on what you see the outlook for the future being, and on any and all of these issues. Also, please add in any issues that impact our economic future, that I may have omitted. Try to be realistic, civil, and correct in ten years.
 


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Issues and Considerations
  • The Trade Deficit - large
  • The National Debt - growing
  • Interest Rates - slowly rising
  • Wages - not keeping up with inflation
  • Job Growth - not meeting population growth
  • China and their currency - shrinking the trade deficit may also mean higher interest rates, i.e., more expensive debt payments
  • Government Expenditures vs. Income - expenditures exceed income; balancing this requires more tax revenue, less spending, or both.
  • Taxes and Tax Reform - One tax reform proposal that is up for consideration: the FairTax
  • Social Security - long-term solvency issues; fixing this may require higher payroll taxes or lower future benefits
  • Defense Spending - supplementals for Iraq and Afghanistan aren't included in the deficit numbers; other defense spending is rising as well
  • Transportation - the increased price of gas slightly increases the cost of goods, and decreases the amount of capital the average American spends
  • Health Care - increased health care costs have similar effects on businesses and people--giving them less money to spend
  • Energy - long-term maintenance and improvement of the grid will require more nuclear, coal, gas, and/or alternative sources of energy
  • Infrastructure - past neglect will necessitate future improvements - new roads, new refineries, etc. This affects energy, transportation, and no doubt other sectors of the economy.
What follows is one (example) scenario. I consider it to be a baseline prediction of what could likely happen without a major shift in US policy, and barring unforeseen events. The best case would be much better, and the worst case would be much worse.

While Social Security reform is addressed for the moment, rising health care costs are not. Interest rates and housing costs increase, further squeezing the consumer. China slowly revalues the yuan, slightly lowering the trade deficit, but pushing the national deficit up. The Chinese economy continues to boom, pushing up commodity prices as they secure energy reserves for their manufacturing industry. The US eventually leaves Iraq, but continues to fight terrorism abroad, saving some money, but with other defense costs slowly increasing. Government and consumer debt increases, and the economic dominance of the US gradually wanes. Not sustainable.

What's your scenario?

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Poll
What Is The Future of the United States?
o Dominant In The World, Forever 3%
o Doomed To Crash And Burn, Hard 16%
o To Move From Bubble To Bubble 8%
o Replaced As A Superpower 6%
o Forced To Share Superpower Status 17%
o Already Not A Superpower Anymore (shh don't tell them!) 4%
o The Next Germany (1933) 22%
o The Next Iraq (1979) 0%
o Back To The 30's! 3%
o Back To The 50's! 0%
o Back To The 70's! 1%
o Back To The 80's! 0%
o Back To The 90's! 1%
o Bread and Circuses! 11%
o Mu. 8%

Votes: 100
Results | Other Polls

Related Links
o FairTax
o Also by pb


Display: Sort:
What Is The Economic Future of the United States? | 141 comments (128 topical, 13 editorial, 0 hidden)
Foreign Affairs (3.00 / 2) (#4)
by srutis on Sat May 21, 2005 at 07:48:34 AM EST

In the Jan/Feb volume of Foreign Affairs, there are two articles about that .. .one rather positive and one negative but both very interesting.

economic future (3.00 / 8) (#5)
by adimovk5 on Sat May 21, 2005 at 08:09:45 AM EST

The Trade Deficit - The US has positive trade balances with some countries and negative trade balances with others. These numbers are mostly meaningless in a world of global trade between multinational corporations. Trade has grown beyond the ability of nation-states to control or calculate accurately.

The National Debt - Congress is addicted to spending other people's money. The debt will continue to float at around the same percentage of GNP.

Interest Rates - Interest rates will remain relatively low. The Federal Reserve is following the old West German model of using interest rates to control growth with inflation as the key indicator. As the economy grows, the Fed will increase rates. There's a limit to how much interest the economy can take. As the economy slows, the Fed will reduce rates to keep the economy warm. This neither hot nor cold approach has kept interest rates reasonable and the economy fairly steady. Alan Greenspan et al have either been very lucky or very talented.

Wages - Wages will continue to drop in the manufacturing sector as the economies of China, Eastern Europe, and India industrialize. Any product that requires no special knowledge will shift to those countries. The US will be left with companies that add high value, produce niche goods, or compete based on qulaity plus speed since they are local. Wages will drop in the tech industry as the labor pool increases. The large salaries of the past will become more in line with other labor intensive sectors. India will be at the forefront of this change. The drop will be gradual since the cheaper labor pool will not be large enough to satisfy demand. People who innovate will continue to receive larger salaries.

Job Growth - Jobs will lag population growth as the society ages. Entrepreneurs will realize the mostly untapped market in care for seniors and schools and jobs will follow.

China and their currency - China will not change its policy soon. It is already too large for the US to control. It will continue to play greedy corporations and governments against each other. No one will want to induce the sanctions necessary for fear of losing money to the others. China will not relax its policy until its GNP is equivalent to the US.

Government Expenditures vs. Income - Expenditures will continue to exceed income at the same rate unless a major catastrophe occurs.

Taxes and Tax Reform - Some form of sales tax will be adopted by the federal government as the main form of income. The governement will still continue to collect income taxes.

Social Security - The system will remain unchanged until a major third party candidate campaigns on the issue and draws support from the every growing percentage of the population that is near and over 65. This will happen much closer to the date that distributions exceed income. The result will be more government power.

Defense Spending - W will continue the slight-of-hand that allows him to pretend Iraq and Afghanistan aren't part of the Defense budget. The next president won't be as lucky. The next president will be faced with the drawdown in both countries and rebuilding the exhausted military.

Transportation - People will adjust to the higher costs associated with more expensive gas. Europeans have lived with higher gas prices for years.

Health Care - The current HMO driven system will fade and be remembered as a failed attempt to keep prices down. Newer efforts will arise such as hospital centered programs and doctor centered programs. You will choose health insurance just as you choose car insurance.

Energy - The cost of petroleum will continue to rise gradually. Research and development will increase as alternatives become cost effective by comparison. New methods of using current energy sources will arise. There's also the strong possibility that an known non-energy source will become an important energy source. Consider the fact that petroleum was known long before it was used to power the world's economy.



Hmm (none / 1) (#14)
by pHatidic on Sun May 22, 2005 at 12:15:06 AM EST

I think entrepreneurs have already realized the value in schools, although I agree that it is still largely untapped. If I were in a contest to make a million dollars as fast as possible, I would develop a product to sell to public schools, as they basically exist to drain the taxpayers money to keep the citizens working at their jobs.

[ Parent ]
job growth revised (none / 0) (#18)
by adimovk5 on Sun May 22, 2005 at 06:48:46 AM EST

Sorry, I was unclear.

From...
Job Growth - Jobs will lag population growth as the society ages. Entrepreneurs will realize the mostly untapped market in care for seniors and schools and jobs will follow.

To...
Job Growth - Jobs will lag population growth as the society ages. Entrepreneurs will realize the mostly untapped market in care for seniors. Entrepreneurs will develop schools that focus on care for seniors and the needs of seniors. Jobs will follow that support the schools and the students emerging from them. Eventually, the 65 plus market will be large enough to rival the coveted 18-35 year old sector.

[ Parent ]

Here's my predictions (3.00 / 8) (#6)
by Betcour on Sat May 21, 2005 at 08:25:17 AM EST

The real estate bubble will end up bursting (as every bubble eventually does), as interest rate rise and as people realize that no crappy 3 bedroom house is worth $1.5 million. All those who bought with variable rates loans or interest-only loans will rush to get rid of their depreciating property, only to increase the speed with which prices will crash.

This will create a lot of bankrupty and bad loans, which in turn will create a major economic recession. The dollar value will fall further, China and Japan will prove unable to stop it and US interest rates as well as inflation will go thru the roof.

At this point the oil producers will likely switch to Euros for trade. Used SUVs will be plentyful and cheap. The US will wake up with low purchasing power and no industrial base left to get back on its feet (it has all been moved to China already). Its world influence will be vastly reduced as it is unable to pay its expensive army by borrowing anymore money.

If you'd like a good mental picture (2.50 / 8) (#7)
by Kasreyn on Sat May 21, 2005 at 01:37:08 PM EST

of the economic future of the United States, I suggest you go into the bathroom, look straight down into the john, and watch closely while depressing the lever.

Once the Baby Boom generation finishes dying off in pampered comfort, the rest of us are going to be looking around and realizing we've been sold down the river into Third World-dom.


"Extenuating circumstance to be mentioned on Judgement Day:
We never asked to be born in the first place."

R.I.P. Kurt. You will be missed.
No Change (and thus, No Story) (2.57 / 7) (#8)
by thelizman on Sat May 21, 2005 at 04:36:50 PM EST

The Trade Deficit - large
And mostly meaningless. I guarantee Wal*Mart doesn't buy jack shit from you, but that you buy stuff from Wal*Mart. Trade deficit: 100%. Does that mean your economic future is bleak? No.

The National Debt - growing
And always will grow, according to inflation. It's percentage of GDP is still nowhere near a level to be concerned with.

Interest Rates - slowly rising
See the next item

Wages - not keeping up with inflation
In market economics, rates of inflation are pegged to wage growth. Wages are a lagging economic indicator. If wages weren't growing, then interest rates wouldn't rise significantly. The fact that interest rates are rising indicate that more cashflow exists in the market. Interest rates are used as a predictor of wage growth, and recent trends indicate wages are growing, and doing so faster than inflation.

Job Growth - not meeting population growth
True - Expect tighter controls on immigration over the next few years.

China and their currency - shrinking the trade deficit may also mean higher interest rates, i.e., more expensive debt payments
uuuuh...yeah...whatever.

Government Expenditures vs. Income - expenditures exceed income; balancing this requires more tax revenue, less spending, or both.
Expenditures have almost always exceeded income. In fact, the social security payments have been shoring up the Federal Budget for decades, which is one of the reasons so many politicians are fighting so hard to preseve the system as it is, instead of modifying it (for better or for worse). Irregardless, the budget deficit isn't growing as fast as predicted thanks to Bush's liberal tax policy and the growing economy it's fostered.

Taxes and Tax Reform - One tax reform proposal that is up for consideration: the FairTax
And...what...do you have a point?

Social Security - long-term solvency issues; fixing this may require higher payroll taxes or lower future benefits
...or it may not. By allowing people to divert a portion of their SSI to private funds, the government will lessen the burden of individuals on the government and allow them greater flexibility in planning. I'll take the 114% five year growth of the average fund manager over the -5% loss over the same period SSI provides.

Defense Spending - supplementals for Iraq and Afghanistan aren't included in the deficit numbers; other defense spending is rising as well
Probably because the money hasn't been spent. You don't debit money until it's spent. The prior supplemental won't be depleted for a few more months.

Transportation - the increased price of gas slightly increases the cost of goods, and decreases the amount of capital the average American spends
No, it doesn't decrease the amount of money you spend. It increases the amount of commodities and goods you purchase. There is no problem with transportation. This falls under "Energy" at the bottom.

Health Care - increased health care costs have similar effects on businesses and people--giving them less money to spend
That's all part of inflation. The 'health care crisis' in this country is largely imagined, however.

Energy - long-term maintenance and improvement of the grid will require more nuclear, coal, gas, and/or alternative sources of energy
Energy prices are a primary contributor to inflation, which is why we need a comprehensive energy policy that encourages domestic renewable resources like biodiesel, nuclear power, and clean coal. If all this sounds familiar, it's because Bush has been harking on it for years, but the obstructionists in congress (democrat and republican) have other priorities.

In all, you seem desperate to know that America is on the verge of crashing, but it's not going to happen. Change is certainly desirable, but the long term outlook is just fine, thanks.
--

"Our language is sufficiently clumsy enough to allow us to believe foolish things." - George Orwell
An interesting take on things, as usual... (3.00 / 4) (#11)
by pb on Sat May 21, 2005 at 07:04:27 PM EST

First, I should say--if you end up being right on this, I will be quite relieved. Of course, we will both eventually learn the truth.

You'll notice that at the end of my analysis, I said 'not stustainable'; that means that in the long term, we can't just keep doing the things that we're doing wrong now, much less at an accelerated pace.

The trade deficit--while not by itself an entirely meaningful number--shows how much more we consume than produce. All other things being equal, I don't think that is sustainable in the long term.

As it stands, the national debt 'always growing' is also not sustainable. Last I checked, debt payments grow at about 4.4% a year, whereas right now we have 2% inflation. Of course, rising interest rates won't help.

Your link about wages was good--it acknowledged that wages were 'at bottom', and would hopefully start to rise. i.e., real wages have been falling. "Economists say the trend has fallen well below the pace of inflation."

Tighter controls on immigration--I'm aware that a majority of the American people want this, but to date, a majority of both political parties don't want this. Are you expecting a third party to come along, shades of H. Ross Perot, to stop that 'sucking sound' from Mexico?

If China revalues the yuan to depend less on the dollar and more on, say, the euro, among other currencies, that means that China's central bank will need to buy less dollars and more euros. This trend may already be happening in Asia. This will require increased interest rates to make the dollar more attractive to investors, and to service our debt. You do realize that the US requires $2 billion dollars in foreign investment every day to keep things running, right?

Expenditures didn't exceed income for the three years prior to George W. Bush taking office. It's interesting that you mention Social Security, because saving the expected budget surplus was to be the means of saving Social Security. Instead, we got 'tax cuts'--a short-term bonus at the expense of a long-term deficit. Then Bush noticed that we suddenly had a Social Security crisis. Bread and circus economics doesn't work.

The FairTax would greatly simplify the tax code, and should make US goods more competitive at home. I'd like to see it studied more extensively to get an idea of what other effects we could expect. Also, I think it could be made a little more progressive. But all in all, I think it's a pretty clever proposal, and unlike whatever tax reform ideas you might have, Congress has already talked about it as an option.

If you believe George W. Bush on this one, private accounts should have no effect on the long-term solvency of Social Security. As to your "114% in 5 years" figure--I'll take it! Where can I sign up?? Perhaps I should mention that even a 53% increase in five years would be a very rosy estimate, the sort of rosy (mis-)estimate that has recently cost pension funds billions of dollars.

My point wrt. the military supplementals is this--it deceives people as to the size and scope of the deficits. You mentioned the same wrt. the Social Security surplus. Adding in those two factors, or including them in projections, tends to make the deficit roughly 50% larger--which is something people should know about.

Perhaps I should be more clear; increased gas prices decrease the amount of money the American consumer has available for everything but gas. It's a budgeting issue, and gas is an inelastic commodity. People who commute, still need to commute just as far. People with delivery jobs still need to drive around. Or they may end up having to quit their jobs, which also doesn't help things.

So you honestly think that health care costs are rising 2% a year? Would that it were the truth. Health care costs have recently risen at 5 times the inflation rate, 8 times the inflation rate... Seriously: it's not 'all part of inflation'. The increasing number of uninsured Americans are not 'imagining' a health care crisis. I'm sure they wish they were imagining it.

Do you think that Bush's energy plan, now or as planned 4 years ago, would honestly fix the energy infrastructure of this country in the long term? Which part does it for you--is it the part where it doesn't address CAFE standards, or the part where it continues our dependence on fossil fuels instead of taking inherently cleaner alternatives more seriously?

Actually, you're entirely wrong about this last point: I'm desperate to know that the long-term outlook is just fine. Unfortunately I don't find your assessment of it to be credible. I sincerely hope that I'm very wrong about this, and that your biggest mistake will be to underestimate the rampant success that we will have in the coming years.
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]

Health care (3.00 / 2) (#23)
by rusty on Sun May 22, 2005 at 11:08:00 AM EST

The health care crisis in the US is very unevenly distributed right now. If you live in, say, California, then you probably have no idea what people are complaining about. When I lived there, I had no trouble getting independent insurance for a couple hundred bucks a month.

Here in Maine, I have my choice of any insurance company I want, as long as it's Anthem BC/BS. Individual insurance would cost me over $1200 a month. My wife went back to work part time solely because she works for a state university and it's the only way we can afford to have health insurance for the family. The state recently unveiled a state-funded plan to improve health insurance coverage, but it's run by the very same Anthem and the prices are about the same.  

Compared to the average income here, we're well into the upper middle class, and there's no way we can afford to insure ourselves. How much worse do you think it is for the average, say, independent carpenter?

There is a health care crisis in the US, and it's real bad. It just isn't everywhere yet.

____
Not the real rusty
[ Parent ]

Hundreds of dollars? (none / 1) (#28)
by lucius on Sun May 22, 2005 at 02:39:49 PM EST

I was looking into private health insurance a while ago (in Australia, it seems the prudent thing to do, with the decay of our free public system), and insurance for a young, single and relatively healthy person goes for maybe $40 a month. This covers a certain amount of dental work, physiotherapy (physical therapy?) and other stuff like naturopathy etc.

How can it be that you people have to pay hundreds? Are your doctors that much better? Richer?

If prices here approached half of those in the US there'd be mobs in the streets.


[ Parent ]

You have free public health care, right? (none / 0) (#29)
by rusty on Sun May 22, 2005 at 02:59:05 PM EST

We don't. So private AU insurers are presumably competing with free, and maybe offering coverage just for stuff that isn't covered by the government? I don't know much about the aussie health system, so this is basically speculation.

My guess is that what you're buying would be called "supplemental health coverage" here, and covers stuff that is uncommon or not covered by primary health plans. It probably costs about the same here, but if it was your only coverage here you'd be screwed.

Besides that, the lack of a government-funded public system here also raises prices because those who can pay end up paying for all the people who can't pay. So if me and someone else both go to a hospital and each incur a $100 bill, and I'm covered and the other guy isn't, on average my insurance company is going to get hit with a $200 bill. The more people aren't covered, the higher the costs are for the shrinking number who are. We're well into that spiral by now, and again in some states it's much worse than in others.

We also get to subsidize drugs for lots of other countries. So, our drug companies export drugs to, say, Canada where prices are controlled by the government. Whatever they don't make from Canadian sales they make up by raising our prices.  Meanwhile our supposed leaders mumble drugco talking points about the cost of developing new drugs, and convenietly don't bother to find out exactly how much of these prices go to marketing and profit (i.e. most of it).

The core problem with our health care system, as with so many other things, is that the United States is a fundamentally corrupt country at this point. We The People don't actually control it anymore. That's probably not as clear to people in the rest of the world as it is for anyone actually living here.

____
Not the real rusty
[ Parent ]

To the contrary (none / 0) (#30)
by mikepence on Sun May 22, 2005 at 04:01:01 PM EST

The only denial about the US being corrupt seems to exist in the heartlands of the US. The rest of the world knows.

[ Parent ]
oddly enough, (none / 0) (#32)
by pb on Sun May 22, 2005 at 04:10:10 PM EST

They rely on a lot of money that comes from other states, too. You'd think that more people in the heartlands would be upset at the extent to which they are dependent on the federal government for help.
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]
They don't know it (none / 0) (#50)
by rusty on Sun May 22, 2005 at 10:31:47 PM EST

Corruption grows best in the soil of ignorance. And the American heartlands are spread thick with it from sea to shining sea. They know themselves to be tough, gritty, independent people, and the lies of the liberal Hollywood elites aren't going to sway them.

____
Not the real rusty
[ Parent ]
I meant to say... (none / 1) (#43)
by lucius on Sun May 22, 2005 at 08:47:44 PM EST

That is covers physio, chiro etc. in addition to private hospital costs, ambulance costs, emergency expenses, specialist consultations and so on. General Practitioner costs are generally borne by the government though. I see what you're saying about competition - the public health system creates a strong incentive not to insure, especially for the young and relatively healthy, the exact people who an insurance company wants to have on their books. More important than competition, I'd say, is our govt's regulation of the insurance industry. They have been trying for years to increase incentives for private health insurance by forcing lower premiums and giving rebates.

The funny thing is, even with all the state fingers in the pie, our system has been shown to be more efficient than the American one per dollar spent (as has just about every other socialised health system). I really think there's some antisocialist bigotry at work in US society.

[ Parent ]

Antisocialist bigotry? (none / 1) (#48)
by rusty on Sun May 22, 2005 at 10:18:10 PM EST

My goodness! That couldn't be! :-)

____
Not the real rusty
[ Parent ]
Slight disagreement (3.00 / 2) (#53)
by godix on Mon May 23, 2005 at 01:43:59 AM EST

The fundamental problem with American health care is not that Americans are greedy but rather that America as a country is wealthy enough to pay for it and Americans as individuals don't think of health care as something they personally pay for.

Spending falls into four catagories.

  1. You can spend your own money on something for yourself in which case getting value for your money and getting something you like is important. Waiting for a sale to buy yourself a new computer would be an example of this.
  2. You can spend your own money on something for someone else in which case price still matters but you aren't that concerned with what the person recieving it thinks. Any kid who's gotten underwear for Xmas or any man that's gotten a tie for fathers day can tell you about this catagory.
  3. You can spend other peoples money on stuff for yourself in which case you grab everything you want no matter what the price. There aren't many real world examples of this but there are plenty of fantasys about it.
  4. And finally you can spend other peoples money on things for other people in which who gives a damn how much it costs and fuck the reciever if he doesn't like it. Most government spending falls under this.
With the way the health care system is currently funded most people fall into catagory 4. They don't need health care, at least not on the hospital level, often and most people get insurance through work so don't view it as something they pay for. The attitudes of people our age towards seniors is a perfect example, throw some money at health care so those old folks aren't guilt tripping us but who cares if it actually helps or how much it costs. Some people fall into group 3 in which case no matter how much it costs they demand to be made healthy. The seniors that demand expensive drugs and expensive surgerys that they can't afford is a good example of this. So what you end up with is a system designed to garner votes amoung the small group pushing for coverage no matter what the cost while the majority don't care as long as they aren't being pestered and no one cares about the cost of it all.

The other factor is that we can afford such a wasteful system. If you have $100 and you're overcharged $10 it's a big deal and you yell and scream to fix the problem. If you have $10,000 and you're overcharged $10 it doesn't matter much and probably isn't worth the effort to argue about. America is wealthy enough that our inefficent system that vastly overcharges us doesn't matter enough to bother with. Especally since the common view is that it isn't us that's getting overcharged, it's the insurance companies and who gives a fuck about them?

The good news is this is changing. The people in group 3 are growing larger and demanding more. Which makes more and more people realize that while it might be the insurance companies getting overcharged we're the ones paying the insurance company to begin with. Situations like yours are also becoming more common and draw attention to the fact that health coverage is your money and not someone elses. I hope things come to a boil and people demand an overhaul of the entire system. I expect things will come to a boil and politicans will paper over the problem with yet another inefficient program, similar to how high drugs costs has been papered over with the perscription drug plan rather than fixing the root problem.

So anyway, health care is a real problem but it isn't a matter of corruption; it's just a matter of the people who need it aren't paying for it, the people who don't need it aren't worried about it, and the people paying for it don't think of themselves as paying for it. Don't attribute to corruption what can be explained by common greed and indifference.


- An egotist is someone who thinks they're almost as good as I am.
[ Parent ]

Other categories. (none / 0) (#55)
by pb on Mon May 23, 2005 at 03:31:13 AM EST

When the people involved actually do care about what the person receiving it thinks. Or, you know, actually want their money spent efficiently, to maximize the benefits and minimize the expenditures. (I'm sure that all sounds like a foreign language in the context of health care, or insurance companies)

Incidentally, I'd say insurance companies are in your category #3, as are most businesses and greedy people that can get away with it. And as far as I'm concerned, that is the very definition of corruption, as well as gross negligence.

Unless, you know, inflating your own enormous salary, stock options, and/or stock price beyond any sane economic valuation counts as 'increasing shareholder value'. Please.
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]

Ah, that catagory (none / 1) (#70)
by godix on Mon May 23, 2005 at 02:30:21 PM EST

When the people involved actually do care about what the person receiving it thinks.

You mean the 'So small it's totally unimportant' group. I wish it were a large group but AFAIK there's probably less than 1 in 100 that fall under it. Of course many will claim they care but if you look at their actions you'll realize they're lying.
Unless, you know, inflating your own enormous salary, stock options, and/or stock price beyond any sane economic valuation counts as 'increasing shareholder value'.

You skipped my favorite trick, the 'We're one of the most profitable companies in the US but we'll beg the government to help pay for WTC, huricanes, and other disasters that we sold coverage on' trick.

I have no love of insurance companies and after having worked for one of the largest I'm of the opinion they're the dumbest most inefficient and most worthless organization since the Dept of Transportation. However the final blame rests with the people who think it's ok to be charged thousands of dollars for a simple test because it's the insurance company paying not them. Catagory 3 is a killer in costs and our system shoves almost everyone in it through insurance, medicare, or just plain not paying your bill (an ever popular health care method these days).


- An egotist is someone who thinks they're almost as good as I am.
[ Parent ]

$1200 a month? (none / 0) (#47)
by Delirium on Sun May 22, 2005 at 09:20:07 PM EST

Geez, I can get one for like $50/month, and I live in Texas. Just go for a high-deductible plan (like a $5,000 deductible), and then pay for the minor stuff out of your own pocket. The health-insurance companies have actuaries who work out the math better than you likely can, so there's rarely a benefit to getting insurance to cover small stuff: They're just going to charge you the expected cost of that small stuff, plus a profit and overhead surcharge. Better to just pay it yourself and cut out the middleman, and keep insurance only for catastrophic illnesses you wouldn't be able to pay for.

[ Parent ]
The high-deductible plan (none / 1) (#49)
by rusty on Sun May 22, 2005 at 10:27:20 PM EST

would be $430 a month for my family. That's with a $5,000 deductible, and the insurance company pays for pretty much nothing until we reach that deductible. I don't have $5,000 lying around against the day my daughter gets sick, so that's just not going to work.

Just for kicks, I looked up all the rates. The regular plan, with a $250 deductible and 20% coinsurance would be $1,452.98 per month, and $250 deuctible with 40% coinsurance is $1,261.55 per month.

Anyone still think there's no health care crisis in this country? Move here if you're so sure.

____
Not the real rusty
[ Parent ]

dear lord (none / 0) (#51)
by Delirium on Sun May 22, 2005 at 10:44:16 PM EST

Maybe that's what happens when you live in an uninhabited frozen tundra. =]

I don't really have any other explanation for how rates could possibly vary by a factor of 10 between Texas and Maine...

As for having $5,000 lying around, the idea is that you save the money you would've paid to premiums and stick it in a tax-free Health Savings Account (HSA), to basically self-insure yourself. I do the same thing with my car insurance: I raised my deductible from $500 to $2000, which saves me about $500/year, so pays for itself as long as I don't get in more than one accident per three years. I put the $500/year in the bank, so if I do get in an accident, I'll have that extra money to pay towards my deductible part.

Basically, you can't come out ahead with a low-deductible insurance plan of any sort unless you use it much more often than the actuaries setting the rates expect.

[ Parent ]

In this country, no. (none / 0) (#85)
by thelizman on Mon May 23, 2005 at 05:28:44 PM EST

In Maine, yes. Move south where State-level economic policy is a little more liberal. I would pay (individually) $120/mo for full coverage, no up-front costs save for the $50/$20/$10 copay through BC/BS North Carolina. A family of three would be about $350. Just do it man. Auction off the yacht, stop buying that high priced monacle polish, and come-on down.
--

"Our language is sufficiently clumsy enough to allow us to believe foolish things." - George Orwell
[ Parent ]
I don't think gas is inelastic (none / 0) (#46)
by Delirium on Sun May 22, 2005 at 09:17:58 PM EST

Gas may be only marginally elastic in the short term, but even there people do things like not take as many unnecessary trips, or car-pool more often. In the long term, people will be encouraged by high gas prices to buy more fuel-efficient cars, and perhaps even to live closer to work.

[ Parent ]
Shadenfreude (none / 0) (#84)
by thelizman on Mon May 23, 2005 at 05:23:54 PM EST

Your link about wages was good--it acknowledged that wages were 'at bottom', and would hopefully start to rise. i.e., real wages have been falling. "Economists say the trend has fallen well below the pace of inflation."
It's worth nothing that having a minimum wage artificially bouys (or depressed, depending on your analysis) this estimate.
Tighter controls on immigration--I'm aware that a majority of the American people want this, but to date, a majority of both political parties don't want this. Are you expecting a third party to come along, shades of H. Ross Perot, to stop that 'sucking sound' from Mexico?
Politicians are politicians precisely because they do what they need to do to survive. The media spectacle around the Minute Man project has already raised the issue to such a visibility that they're having to take the issue head on. I'm sure many senators are glad the fight over judicial nominees is going down now to take the heat off them from immigration.
You do realize that the US requires $2 billion dollars in foreign investment every day to keep things running, right?
The converse is that several countries worldwide would experience broad socialeconomic and political collapse virtually overnight if the US government alone stopped making foreign aid grants. Theres a degree of reciprocity going on roughtly equivalent to Nuclear Mutually Assured Destruction. That is, fundamentally, what economics is all about.
Expenditures didn't exceed income for the three years prior to George W. Bush taking office.
That's patent bullshit. There's only two years during which the treasury recorded receipts in excess of expenditures for that fiscal year, and those windfall amounts were less than a few hundred million. That was just pure democrat talking-points memo there, and I'm disappointed to see it.
The FairTax would greatly simplify the tax code, and should make US goods more competitive at home.
So would a flat tax. The only problem I see with the fairtax is that it would not work if all forms of other taxation weren't first abolished. There are 50 statest that'll have that much more reason to raise their income tax rates if a fairtax were enacted.
So you honestly think that health care costs are rising 2% a year? Would that it were the truth. Health care costs have recently risen at 5 times the inflation rate, 8 times the inflation rate... Seriously: it's not 'all part of inflation'. The increasing number of uninsured Americans are not 'imagining' a health care crisis. I'm sure they wish they were imagining it.
Hello. I'm uninsured. I paid $50 last week to have a funny mole removed. So, I didn't get to buy a new CD, go see Star Wars, and drink beer with my friends. Life is about sacrifices, and if I wanted to get a good PPO plan, I could do it for less than the cost of two moles a month. It was benign, thanks for asking : )
Do you think that Bush's energy plan, now or as planned 4 years ago, would honestly fix the energy infrastructure of this country in the long term? Which part does it for you--is it the part where it doesn't address CAFE standards, or the part where it continues our dependence on fossil fuels instead of taking inherently cleaner alternatives more seriously?
In the long term, yes. In the short term, no. We've been living off a fat diet of middle eastern crude for years now, paying energy costs that haven't kept up with inflation. Scarcity, high prices, and political instability are facts of life. Until the investments in technology improve, we will have to be dependant on fossil fuel. Had Bush's energy plan not been obstructed for so long, we'd be that much closer to an environmentally friendly infrastructure that doesn't place us at the whim of 2/3rds of the worlds unelected dictatorships. And to be reasonable about it (which some people don't seem capable of reason where Bush is involved), Bush's proposals center largely on hydrogen and "new clurr", neither of which are "fossil fuels".
Actually, you're entirely wrong about this last point: I'm desperate to know that the long-term outlook is just fine. Unfortunately I don't find your assessment of it to be credible. I sincerely hope that I'm very wrong about this, and that your biggest mistake will be to underestimate the rampant success that we will have in the coming years.
I don't think I am. You're perhaps not conscious of it, but most of your line of questioning is predicated on assumptions of doom and gloom. That doesn't mean change and reform is not needed, but to posit that total collapse is emminant because one or two minor factors is very... chicken little. Your rhetoric also riddled with shadenfreude that is not particularly demonstrative of hope.
--

"Our language is sufficiently clumsy enough to allow us to believe foolish things." - George Orwell
[ Parent ]
Fahrvergnügen (none / 1) (#87)
by pb on Mon May 23, 2005 at 06:20:07 PM EST

Re: minimum wage -- it's also worth noting that $5.15 an hour is nothing nowadays. In real terms, the minimum wage would have to be raised at least $2 to account for inflation.

As for immigration--sure, that's a contentious issue, but frankly we have a lot of contentious  issues facing us nowadays, and they all need to be addressed. Senators gain nothing by delaying any of them, although I can see why some Senators might want to delay specific (state-dependent) issues past '06.

That's an interesting scenario you mention regarding foreign aid--the US' current investment situation is very much like a country receiving foreign aid. Except that we really should be able to get by without it. Our foreign aid budget amounts to less than a week of our borrowing from others to make ends meet. And although I'm sure some would suffer without our aid, I'd argue that about as many would suffer without Japan's aid. Far more would suffer without Europe's aid.

Re: bullshit -- I'll notify the CBO that they've been hacked by George Soros, moveon.org, and whatever other elements of the Vast Left-Wing Conspiracy. :P

You're right, the Fairtax does depend on abolishing most if not all of the other taxes we have. To say that that would be a politically contentious matter would be an enormous understatement.

Congratulations on the mole; I did the same years ago, I don't remember how much it cost. I pay more than that $50 in insurance coverage every month. On the other hand, if something unexpected and serious did happen to me, I'd be covered -- I'd be only somewhat broke instead of very broke. Of course, some people need insurance more than you or I do at the moment.

From what I've seen of Bush's (enacted!) plans, excuse me if I'm skeptical of his alleged environmentally friendly nature. The skies and forests aren't buying it, despite what he'd have them believe. And burning coal to produce hydrogen doesn't strike me as a shift away from fossil fuels.

I have intended for these discussions to be grounded in a realistic list of economic realities. Where do you see this excess doom and gloom? My opinion is that change and reform is needed, but oddly enough I haven't posited "total collapse" at all. I suppose that would happen given no changes at all, over a long enough period of time (compound interest is a bitch). But hopefully it won't come to that.

You want to see hope? Tell me about how great things are going. Let me know that the economic statistics for the past few years have been revised upwards. Talk about how great we're doing in Iraq (the latest I've heard today is that more people are dying because we're winning...), and how much it'll pay off in the end. I'm all for it, as long as it ends up being true.
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]

Mooooole (none / 0) (#109)
by thelizman on Tue May 24, 2005 at 01:08:59 PM EST

Re: minimum wage -- it's also worth noting that $5.15 an hour is nothing nowadays. In real terms, the minimum wage would have to be raised at least $2 to account for inflation.
It's also worth noting that the minimum wage is just that - a minimum. It was never meant to be a living wage, but a basic sustanance amount. People who earn minimum wage tend to be low/no skilled workers with little or no formal education. The work iself isn't very demanding either - stock boys, sales clerks, fast food workers, et al. It also doesn't apply to some people - waiters for instance, who usually deserve more (and typically get it through tips, which can be kept off the books and usually are), or farm workers who get more because the work is harder. The minimum wage is really a joke of an entitlement, and fosters a wage slave mentality which keeps millions mired in financial doldrums by removing natural market forces from the picture. You're right, the Fairtax does depend on abolishing most if not all of the other taxes we have. To say that that would be a politically contentious matter would be an enormous understatement.
Congratulations on the mole; I did the same years ago, I don't remember how much it cost.
It's not strictly a mole, mind you. I think they call it a skin flick - a mole-like lump of flesh that protrudes from the skin. I had about six of them. I cut the other two off with scissors because I thought they were unsightly. I had the professional handle this one because it changed colors. Turns out it was just the lack of blood supply. They're packed with vessels, which is evident when you just chop them because they bleed like crazy.
From what I've seen of Bush's (enacted!) plans, excuse me if I'm skeptical of his alleged environmentally friendly nature. The skies and forests aren't buying it, despite what he'd have them believe. And burning coal to produce hydrogen doesn't strike me as a shift away from fossil fuels.
How many times does he have to mispronounce 'nuclear' here. Nuclear is the only option we have for reducing our dependance on fossil fuels. And Coal is the only short-term solution for reducing our dependance on foreign oil and controlling energy costs. We can build new coal plants in less time than we can drill new oil wells in the Gulf or ANWAR, suprisingly enough.
You want to see hope? Tell me about how great things are going. Let me know that the economic statistics for the past few years have been revised upwards. Talk about how great we're doing in Iraq (the latest I've heard today is that more people are dying because we're winning...), and how much it'll pay off in the end. I'm all for it, as long as it ends up being true.
Truth has no role in politics. Only propaganda. Does 6 million people being free and living in a democracy count for anything? If numbers of killed are important, then count mass graves. Saddam did far worse as a matter of course than we've done with all due caution.
--

"Our language is sufficiently clumsy enough to allow us to believe foolish things." - George Orwell
[ Parent ]
I don't believe you brought that up. (none / 1) (#116)
by pb on Wed May 25, 2005 at 04:18:38 AM EST

If numbers of killed are important, then count mass graves. Saddam did far worse as a matter of course than we've done with all due caution.

First, I'd like to mention that the "we're killing people slower than a brutal dictator" is incredibly lame, whether or not it's the truth. Which is better, drano or cyanide? Pardon me if I drink orange juice instead.

However: I'd like to see an accurate and in-depth assessment of 'mass graves' in Iraq. It would be nice to know who killed who, when. The policy of the US is generally not to count how many dead Iraqis it is responsible for--and most of the time that works pretty well for them. However, they love to count how many dead Iraqis Saddam Hussein is responsible for. At least, they love to now that he's the enemy.

As to who and how many people could be in those mass graves: the US and Britain toss around figures like 300,000 or 400,000 people, but no one knows for sure. About 5,000 people have been found so far. They could be there for a number of reasons, including: (a) the Iran-Iraq war; (b) the first Gulf War; (c) the intervening period of sanctions; (d) The present conflict; (e) Saddam being a brutal dictator. Now, a-d alone already add up to more than 400,000 deaths. So, yeah, I'd like to see some research on this.

Meanwhile, millions of people starved in North Korea over a much shorter period of time. Maybe they have mass graves there.
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]

Blame Bush, not Kim Jong Ill (none / 0) (#135)
by thelizman on Fri May 27, 2005 at 02:45:34 PM EST

Meanwhile, millions of people starved in North Korea over a much shorter period of time. Maybe they have mass graves there.
I'm sure that's all Bush's fault too.
--

"Our language is sufficiently clumsy enough to allow us to believe foolish things." - George Orwell
[ Parent ]
Clinton, actually. (none / 1) (#139)
by pb on Mon May 30, 2005 at 12:21:55 AM EST

I think it started in 1994, or 1997, or so; not sure when we knew about it. Ancient history, unlike 1991. However, if Bush had really wanted to overthrow a brutal dictator, to liberate people from tyrrany, well... I'll let him speak for himself.

"Look, Kim Jong-il is a dangerous person. He's as man who starves his people. He's got huge concentration camps. And, as David accurately noted, there is concern about his capacity to deliver a nuclear weapon. We don't know if he can or not, but I think it's best when you're dealing with a tyrant like Kim Jong-il to assume he can." -- George W. Bush

Fair enough. He knows what's up. Tough-talking George W. Bush isn't going to stand idly by while someone actually develops nuclear weapons, and starves people, and sets up concentration camps...

"That's why I've decided that the best way to deal with this diplomatically is to bring more leverage to the situation by including other countries." -- George W. Bush, two seconds later

...or not...
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]

Trade deficit (none / 1) (#22)
by Betcour on Sun May 22, 2005 at 11:03:01 AM EST

I guarantee Wal*Mart doesn't buy jack shit from you, but that you buy stuff from Wal*Mart. Trade deficit: 100%. Does that mean your economic future is bleak? No.

You don't seem to understand what a trade deficit is : it's the sum of all purchase and all incomes (for an individual : all expenses as well as incomes - not just some expenses as you seem to believe)

[ Parent ]

*sigh* (none / 1) (#78)
by thelizman on Mon May 23, 2005 at 04:46:27 PM EST

It was an illustrative example, Captain Obvious.
--

"Our language is sufficiently clumsy enough to allow us to believe foolish things." - George Orwell
[ Parent ]
Walmart does tarde with us (none / 0) (#60)
by blackpaw on Mon May 23, 2005 at 06:31:42 AM EST

The Trade Deficit - large And mostly meaningless. I guarantee Wal*Mart doesn't buy jack shit from you, but that you buy stuff from Wal*Mart. Trade deficit: 100%. Does that mean your economic future is bleak? No.

It purchases our labour, raw products and taxes.

[ Parent ]

Certainly (none / 0) (#77)
by thelizman on Mon May 23, 2005 at 04:44:41 PM EST

..but not from you. Wal*Mart hasn't bought jack shit from me, but I've probably spent about $5,000 with them this last year. Granted, they do purchase $4 billion from businesses in my state, but I'm not one of them. Hence, my trade deficit with Wal*Mart, and everyone else for that matter is still 100%. One of my clients is offering a sweet deal on leasing an office building with an upstairs loft that I can use for an apartment. That'll help my trade deficit.
--

"Our language is sufficiently clumsy enough to allow us to believe foolish things." - George Orwell
[ Parent ]
I agree with alot of what you say except. (none / 0) (#76)
by mpalczew on Mon May 23, 2005 at 04:44:02 PM EST

>  The 'health care crisis' in this country is largely imagined, however.

While I agree that health care isn't in crisis, in general people are paying more every year and getting less coverage.  I have personal experience with this.  

> domestic renewable resources like biodiesel, nuclear power, and clean coal

nuclear and coal are not renewable.  Coal still polutes tons of CO2.  Nuclear, wind, solar, hydro, would be my choices, though some technologies aren't there yet.

> No, it doesn't decrease the amount of money you spend. It increases the amount of commodities and goods you purchase.

I think you meant decreases in the second sentence. If you spent your money on transportation you won't have as much for other things.  

and lastly

> The Trade Deficit - large
And mostly meaningless. I guarantee Wal*Mart doesn't buy jack shit from you, but that you buy stuff from Wal*Mart. Trade deficit: 100%. Does that mean your economic future is bleak? No.

not gonna argue that this is bad.  It seams that by buying more we are encouraging growth in other countries that will be able to buy our stuff later.

However you probably are getting paid by someone else in your analogy and therefore your total trade defficit should be in your favor(at least if you are saving for your retirement).
-- Death to all Fanatics!
[ Parent ]

The US has a long way to go (2.81 / 11) (#9)
by godix on Sat May 21, 2005 at 05:06:30 PM EST

before we're all that bad. Even if we take a dive, and I think we will somewhat, we'll STILL be better of than most. For example, the US current has 5.2% unemployment, contrast that to Germany which has 12.5%. That's a lot of people losing their jobs until we're as bad off as Germany nevermind the real economic shitholes of the world. Or compare GDP (pdf link). The US could lose half it'd GDP value and STILL be #1 in the world by a margin greater than the entire GDP of Canada. So before everyone trots out the doom and gloom scenarios keep in mind we have a LONG way to fall before we'd be nothing more than equal to the rest of the world.

Anyway, on to your issues:
The Trade Deficit - Large but not a huge problem. People who think the trade deficit is a huge problem need to realize that wealth isn't a zero sum game. To illistrate, you can give your local bum $10 every single day without ever running out of money as long as you make $10.01 or more every day. The same is true of the US, it can send out billions a day forever provided it makes billions + 1 cent at the same time. I don't see problems with the trade deficit, much of what the US imports are luxery goods and if times got tough people would quit buying the luxery goods therefore the trade deficit would lower itself. If the US was like Japan where it MUST import raw materials then there might be a problem if things got bad but we aren't, the US is capable of sustaining itself if it ever needed to.

The National Debt - Growing but much of the problem is related to military spending which will fall as we withdraw from Afghanistan and Iraq. Most of the rest is related directly to social security, medicare, and other entitlement programs and nothing serious will be done to those until Amerians get smart and realize we either need Europe like tax levels to fund Europe like social programs or we need to drop the social programs. Somewhere in the future a USian will either be paying much more in taxes or will quit relying on the government for handouts. Probably we'll settle for higher taxes but I'd like to think Americans have enough spark of independence and resonability to ditch the redistribution handout model.

Interest Rates - Are pretty damned trivial as a way of measuring the economy or an influence on the economy. Greenspan has been raising them as the economy raises so if anything raising interest rates is a good sign but overall there's much better indicators and influences.

Wages - not keeping up with inflation ...amoung low skilled labor. Education is the key to good jobs but unfortunately a large segment of the population doesn't realize that. The problem is education not financial here.

Job Growth - The US has what is, historicall speaking, a low unemployement figure. Not much to worry about here.

China and their currency - While this will, and does, cause problems I personally expect China to enter into the same type of labor problems that the US did in the early 1900's and when that happens they will be replaced by other third world shitholes for cheap no skill labor products.

Government Expenditures vs. Income - This is the national debt with a different phrasing. Same answer as I mentioned in the national debt

Taxes and Tax Reform - As I said, either the US is heading to HUGE tax inceases or we're heading to massive cuts in entitlement programs. If it's the first then any tax reform will be just a way to disguise a tax hike. If it's the second I could actually see a situation where the poor and middle class pay no taxes and only the upper middle class and rich do.

Social Security - It's either going away and we'll have to provide for ourselves or we're getting our taxes raised. Bush's plan is, basically, a very small baby step in the first direction and looking at how much shit he's getting for it I kinda doubt there will be a second step.

Defense Spending - will go down after Afghanistan and Iraq. The number of men in the military will drop signifcantly and they will be replaced with high tech devices which are expensive but not nearly as expensive as a platoon of soldiers. The US will retool it's military to be designed for small tactical strikes against enemies rather than overwhelming WWII like battles. We were already heading in that direction before 9/11.

Health Care - I HOPE the US will go to a somewhat European like system where the federal government direct finances basic health care but advanced or unneccesary care will be suplimented by individuals. Insurance will still be around and still be an employement perk for this advanced care but it won't be the sole finacing for most Americans. This is what I hope. I EXPECT we'll slap minor patches on the semi-free market semi-socialized health care system we have now that takes the worse of both systems and tosses out the best of them.

Energy - Two posabilities. Either oil will continue to rise while alternative energy falls and there will slowly be a switch as those prices come closer together. Energy prices will slowly go up as those prices converge then when alternative energy becomes cheaper than oil real energy prices will fall as the economies of scale kick in on alternative energy. I am including cars when I mention alternative energy, as oil goes up the hybrid cars will be much more popular.
Posability #2: Someone finally gets the enviromental pussies to shut the fuck up and we can use nuclear power and provide much more energy than we currently do for far cheaper. Unlikely to happen, the US is rich enough to afford higher energy prices to keep enviroidiots happy and will probably continue to do so.

One that you didn't mention, the EU. If the EU pulls together it will become a powerful force and may eventually resemble the US as far as structure and economics goes. I doubt it'll pull together through. Racism, nationalism, and self interest will keep the EU from really unifying it's members economys. Just look at the naysayers in the French EU Constitution vote to see exactly what I mean.

My baseline prediction: The US economy keeps growing. There will be problems and people will react to them as if the world was ending but really they'll be minor blips. China will have economic problems, perhaps even a full revolution, and will no longer be our major trading partner. Some other shithole of the world will quickly take their place. Unskilled low paying labor in the US becomes rarer and the lower class gets hit. Politicians use that as a guilt trip to increase federal entitlements. The US tax rate slow raises until it's more in line with what you see in Europe. The high tax rate severly limits US growth in the future but it takes decades for any country to catch up to the huge gap betweent he US and everyone else. US military transforms itself and future military actions will rely even more on technology than we already have. Occupations are unlikely although we would be able to occupy one country with the same sort of problems we're having occupying two now.


- An egotist is someone who thinks they're almost as good as I am.

RE: Trade deficit (none / 0) (#131)
by vectro on Thu May 26, 2005 at 11:38:52 AM EST

I think you don't quite understand what the trade deficit is. By definition, it's a net figure -- so the total amount we're taking in is less than the total amount we're paying out. Normally, this would be adjusted by a change in currency valuations -- making our imports more expensive and our exports cheaper -- but due to currency shenanigans in other countries, trade barriers, and more international politics, the currency can't adjust as much as it should.

This is a problem. It means we are borrowing our imports from foreign countries, and one day they're going to come knocking. The only solution then will be massive inflation.

The proper solution to this problem is to increase the savings rate, which will counteract the US's status as a debtor nation. The best way to increase the national savings rate would be to cut the government budget deficit, but more savings in the private sector would be welcome as well.

“The problem with that definition is just that it's bullshit.” -- localroger
[ Parent ]

Heartwarming theory on national debt (2.75 / 4) (#10)
by StephenThompson on Sat May 21, 2005 at 06:27:01 PM EST

Microsoft's stock value is 30 times higher than its income. This is considered a measure of the company's value, a sign the company is healthy and powerful. The US's national debt is the same. Consider: the US is widely considered one of the most healthy economies and most powerful contries, and yet, it also has the highest debt of any country. A nice correlation. Tell yourself this when you go to sleep at night. Feel good about it. It'll be good for your stress levels and make you happier.

Yes (none / 1) (#13)
by pHatidic on Sun May 22, 2005 at 12:09:28 AM EST

But is it true?

[ Parent ]
it's true in terms of summarizing opinions (none / 0) (#54)
by Delirium on Mon May 23, 2005 at 02:10:36 AM EST

It's clearly the sum opinion of the global bond markets that the U.S. is an exceptionally reliable creditor, so much so that they're willing to buy our debt at relatively low interest rates (around 4%) even though we already have an enormous amount of outstanding debt. If they expected our economy to collapse, they would be demanding more than 4% interes to buy our debt.

[ Parent ]
US Infrastucture (3.00 / 5) (#12)
by cronian on Sat May 21, 2005 at 10:02:45 PM EST

America's physical infrastructure is crumbling. With all the wasted federal spending on military, wars, and corruption the US has been neglecting the proper maintenance of roads, trains, schools, water sanitation, parks, and other basic things. These things are the backbone of sucessful culture and commerce.

According to the American Society of civil engineers american infrastructure received a 'D'. Likewise, the CIA World Factbook states "Long-term problems [for the United States] include inadequate investment in economic infrastructure".

Other problems can be dealt with. Loans can be repudiated or forgiven. New technologies can emerge. However, it takes time build up infrastructure. The United States shouldn't have third rate infrastructure.

We perfect it; Congress kills it; They make it; We Import it; It must be anti-Americanism
added, thanks! [nt] (none / 0) (#15)
by pb on Sun May 22, 2005 at 04:03:04 AM EST


---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]
Maybe - Is there anywhere without such a crisis? (none / 0) (#16)
by sien on Sun May 22, 2005 at 05:34:33 AM EST

Is there a country where someone is not saying there is an infrastructure crisis? Seriously, there is one in Australia and one everywhere else, all the time.

Why, you'd almost think the people building infrastructure might have an interest in getting more money by drumming up a crisis.

[ Parent ]

The roads in Louisiana... (3.00 / 2) (#20)
by gr3y on Sun May 22, 2005 at 10:23:29 AM EST

are so bad that the state maintains a network of public schools that have such small classes they graduate one or two seniors a year, every year, because otherwise the buses can't deliver all the students to the school on time, and they start picking them up before dawn.

The roads in my own beloved Hampton Roads are in terrible condition, maintenance is horribly managed by the Virginia Department of Transportation, and their condition is only worsening. The local communities want a half-cent sales tax increase to build a new "third" crossing, making more road to maintain, but have no plans to overhaul VDOT, which has steadfastly failed to maintain the road that exists.

I've driven across the United States three times. Bridges that were built as part of the Eisenhower Interstate System are crumbling. ALL Major interstates are infested with interstate trucking. In Hampton Roads, a few drivers trying to meet a delivery schedule routinely kill a few people every year by failing to yield on I-64 near the Patrick Henry Mall exit, where the road narrows. When four lanes become three, and then three become two to cross the Appalachians or Rockies, there is almost always a truck going fifty miles an hour in the left-hand lane passing the truck going forty-eight in the right-hand lane because adding a lane to interstate in the mountains involves removing tons of rock and is so expensive no sane community will even consider it.

And we are shipping all our steel and concrete to China to fuel their economic expansion.

No. The infrastructure "crisis" is very real. The separate states are allowing contractors to get away with murder, overruns, and piss-poor project management because they know they have no choice.

I am a disruptive technology.
[ Parent ]

VDOT (none / 0) (#64)
by wiredog on Mon May 23, 2005 at 08:36:02 AM EST

Thank you George Allen for the car tax reductions, which starved VDOT of money. It's pretty bad here in Fairfax, too.

Wilford Brimley scares my chickens.
Phil the Canuck

[ Parent ]
Same story in Oklahoma (none / 0) (#124)
by partialpeople on Wed May 25, 2005 at 03:39:34 PM EST

One of the main legislative issues facing Oklahoma is the funding of massive project to update hundreds of ancient bridges.  The money just isn't there for the long-term.

These bridges have been neglected for 50 years.

Three years ago an Oklahoma bridge collapsed after a boat collided with it, a collision that wouldn't be a problem for more modern structures.  Several people were killed.

http://www.tripnet.org/OklahomaBridgeMay2002.PDF

Our nation's infrastructure just isn't discussed enough.

[ Parent ]

Frankly... (none / 0) (#127)
by gr3y on Wed May 25, 2005 at 07:51:41 PM EST

I expect very little of government, which is perhaps an indictment of our system of government. Maintaining the roads is one thing only the government can do. Speak not to me of the foolish libertarian notion that each road should be a toll road. I also expect the government to maintain a reliable system of communication, like a postal service.

One of the things that has made every great civilization great is a reliable system of roads to move goods and people, and a reliable system of communication to move ideas. This country has neglected these basic needs because money is the overriding imperative of America's ethic: the business of American is business.

It was not always so, but it is now. Combined with the rising cost of health care, the retirement from the workforce of the boomers, Social Security insolvency, the increased pace of operations-other-than-war, and capital flight of American industry and labor overseas, and the future is not looking as bright for America as it was in 1946. There will not be a second American century.

The thought depresses me. I, however, can do nothing about it. The overriding imperative I referred to earlier is firmly in control of our elected officials.

I am a disruptive technology.
[ Parent ]

Europe (none / 0) (#24)
by MSBob on Sun May 22, 2005 at 11:12:26 AM EST

I lived in western Europe prior to coming to Canada. The roads in Europe are much, much better maintained than here in Canada or in the States. The roads here are more akin to impoverished countries of Eastern Europe like Ukraine or Belarus than that of a leading economy.
I don't mind paying taxes, they buy me civilization.

[ Parent ]
Really? (none / 0) (#129)
by sien on Thu May 26, 2005 at 12:20:17 AM EST

Roads I saw in Croatia and Poland were much worse than roads in the US. I can only imagine the Ukraine and Belarus are substantially worse. How many 4+ lane highways do they have? As for other industrialized countries you should come and check out Australian roads. We are years behind the US. No major Australian city has a ring road the way almost ALL major US cities do.

[ Parent ]
I'm not talking about layout (none / 0) (#132)
by MSBob on Thu May 26, 2005 at 04:12:08 PM EST

I'm talking about the condition. Polish roads are typically narrow and crowded but at least they aren't riddled with potholes every 10 yards like Canadian ones.
I don't mind paying taxes, they buy me civilization.

[ Parent ]
Actually, that's not all we can do. (3.00 / 3) (#19)
by skyknight on Sun May 22, 2005 at 09:28:48 AM EST

We could also hope for the best and prepare for the best. Suicidal though that may be, it would seem to be the strategy under which most people labor. The hope is that it's their grandchildren who will be bled by their fiduciary chicanery, or better still, that pennies will rain from heaven.

Also worth considering: cosmic justice does in fact not exist; the world economy, as it is presently configured, could not tolerate the loss of the US and consequently will not allow it to happen, thus the efforts of other countries to prop up our currency.

I think that the US is in the middle of a painful transition from being the world's industrial leader to being the world's knowledge production leader. This will be a very unpleasant transition for those who planned their lives around an industrial world and now find themselves in a sea of computing technology. Oh well. The people who weaved things by hand fared ill when mechanized looms arrived on the scene, and if the job you presently perform can be performed by either an accounting program or robotics, then you are in for a world of hurt. Evolution takes no prisoners in the natural world, and at best it puts prisoners in extermination camps in the economic world. So it goes. Adapt or die. If America does not adopt such a hard-nosed strategy, then some other nation will, and will consequently exploit it to America's disadvantage.

The health care system is whack. The US spends more money on health care than any other country on the world, but somehow manages to see less in the way of total services. This is because there are enormous inefficiencies regarding the way the system is configured. We spend an enormous amount of money on the act of passing the buck, and thus when the rubber meets the road, or the physician meets the patient, much of the health care dollars have already been burned on outrageous administration costs. However, that being said, I am adamantly against state run health care. Monopolies are a bad thing, whether they are in the public or private sector. If things become corrupt within an organization, as they inevitably will, and there are no other players on the field, there is no competitive pressure exerted to correct the deformities. As a good first step, I think we should decouple employers and health care payers. People should be able to buy reasonably priced health care without it being tied to their job. Our present system is an anachronistic carry-over from the government fixing wages during WWII and employers finding ways to hack around the limitations of the system to compete for employees.

Social Security, as run by the government, is just a bad idea. It was a bad idea when it was instituted, and now we're trapped under its weight. It would be incredibly cruel to make people who have paid into it for their whole lives go without benefits now, and it is incredibly cruel to make young people pay into it now without any hope of ever seeing return. The simple matter of fact is that when you add everything up, there is no free lunch, and seeing as the initial recipients of the system were given such a lunch, it's likely that someone is going to end up paying for lunch and going hungry, subsidizing someone else's lunch and getting none of their own. The only way you can avoid this is to bleed rich people who don't need social security payments to pay for those who do.

A simplified tax code would be a huge boon for the economy. At 7.5 million words, the US tax code is out of control. There's no reason a good tax code could not be fully described on a few sheets of paper at a reasonable font size. As it stands, all of this bloat serves to favor corporations with a lot of pull who can get laws written specifically for them, rich people who can afford tax lawyers and accountants, and the tax lawyers and accountants who cash in on the tragedy. The US tax code should be burned to the ground and re-written from scratch.

The US military is in a bit of a pickle... On the one hand, it wants to be able to fight asymmetric warfare against terrorists. This means having a light and nimble force that can reach any corner of the globe within hours by air transport, instead of juggernaut-style forces that can roll over anything but have to be shipped via boat and take weeks to arrive. On the other hand, the US needs lots of conventional forces for two reasons. Firstly, if you're going to address the roots of terrorism, that means nation building, and nation building needs lots of boots on the ground. Grunts patrolling the streets of hostile regions aren't much helped by precision guided ordnance. They need lots of fellow grunts to spread the work, they need really good armor on their Humvees to deal with the people who want to kill them, and they need language skills to deal with the people who don't want to kill them so that they don't humiliate them, causing them to transition to the other team. Second, the US needs large conventional forces to deal with the rising threat of China. Simply put, China is building a huge navy, and that absolutely has to be countered in some way or other. If China has an armada of boats, the US needs an armada of boats. The real problem here is that the US has two conflicting goals, both of which are very expensive, and a ham-strung budget at home making every expenditure very painful.

Energy management is going to become an increasingly intractable problem. Not only are the present supplies already troublesome given their geographical location, but China and India are rapidly developing an insatiable appetite for energy. Unless the US wants to find itself in a bloody and protracted war over the world's energy reserves, it needs to find a way to attain energy independence, and it needs to do it quickly. I don't have a good feel for what the time line on this ought to be, but I would hazard a guess that things are going to be really bad if we haven't tackled the majority of this problem by 2020.

Perhaps the biggest problem in my mind that you have neglected to mention is that of education. As someone who has been through a lot of education in the American system, something that I find striking is that a lot of people don't seem to harbor a sincere and mature devotion to learning. They want to get their piece of paper, get out into the work force to make mad bling bling by tapping into that piece of paper, and they don't much care about possessing a tangible store of knowledge. Increasingly, American schools are becoming paper mills. It's a lucrative industry, and it's unsustainable because it's a fraud. There is far too much focus on airy credentials from accredited universities, and an alarming amount of focus on arbitrary metrics and the consequent "teaching to the test" in grade school. The result is a bunch of freshly minted college graduates with an entitlement syndrome, no idea of how what they have done in school might be applied to the work force in a meaningful way, and an utter disdain for the pursuit of knowledge.

In the end, a sense of entitlement is the kiss of death. It's a dog eat dog world. You'd better be a big and crafty dog, or you're on the menu.



It's not much fun at the top. I envy the common people, their hearty meals and Bruce Springsteen and voting. --SIGNOR SPAGHETTI
Mirage. (2.60 / 5) (#34)
by Znork on Sun May 22, 2005 at 05:32:37 PM EST

"I think that the US is in the middle of a painful transition from being the world's industrial leader to being the world's knowledge production leader."

The very concept of a knowledge economy is a mirage. The ties to demand are far too weak and the manpower requirements are nowhere near what they used to be for industrial production. Even the current employment capacity of the 'knowledge' sectors is mostly driven by monopoly inefficiency derived from intellectual monopoly legislation, not from demand.

Frankly I suspect we've reached a point where productivity increases has production outstripping demand in general, while market monopoly distortions are preventing the falling prices we should be seeing in many sectors.

No, I think it's a more difficult transition ahead. It's not a transition from the fields to the looms or from the looms to accounting. It's a transition from accounting to the sofa, where the evolution ends.

[ Parent ]

I wish you'd elaborate (none / 0) (#38)
by jongleur on Sun May 22, 2005 at 06:47:17 PM EST

in a diary or official piece. Or at least, is there one book (I'm lazy) to read on the subject?
--
"If you can't imagine a better way let silence bury you" - Midnight Oil
[ Parent ]
Social rearrangement (3.00 / 2) (#61)
by Dievs on Mon May 23, 2005 at 07:31:49 AM EST

There is the idea, that the number of people needed to cover basic needs keeps decreasing.

In medieval times, the number was about .95 - meaning that no more than 5% of people could be working on anything other than food/clothing/shelter.

Currently the ratio is varying wildly between countries - between nearly .3 for USA (if you don't count all the service industry, 'knowledge industry', entertainment industry into this, but do count the remains of heavy manufacturing, like car factories), and the same .95 for parts of Africa.

But it's shrinking.
So there will be much less demand for workers in the future. And there is a limit on how much resources there is in the world.
  So, the 'haves' who will control the resources will be facing a huge class of 'have-nots' whose labour is not needed at all - where the 'haves' would be better off just eliminating the others, so that more of the resources are left for their consumption - where will that go ?
  In past times, the ruling class NEEDED the peasants to grow the food. To support a million aristocrats of medieval times, the whole 6 billion of the world would not be enough.
  But if, in the near future, a million of 'Alphas' can be supported by half of them working 2-3 hours a day because they like it, plus a million of either human, genetically engineered 'Betas' or robot servants - then most of world's population will just be a disturbance for them...

[ Parent ]

That's when the revolution comes (none / 1) (#63)
by Have A Nice Day on Mon May 23, 2005 at 08:11:47 AM EST

or hopefully the transition to another state of existance. No, I don't mean transhumanism, I mean a state where technology supports all humans and work becomes unnecessary.

Have you read "Robotic Nation" ? It deals with two possible outcomes, one is your situation where the elite own everything and everyone else is seen as a burden. The other ("The Australia project") details a sort of future communism, where nobody works (unless they want to). I know where I'd rather be, even if I was one of the rich in the US.

--------------
Have A Nice Day may have reentered the building.
[ Parent ]
Theory... (3.00 / 3) (#66)
by Znork on Mon May 23, 2005 at 12:01:08 PM EST

Dievs summarizes the theory pretty well, I think, and I'm sure there's been something serious written somewhere about it, but I think it's the last decades with new phenomena like the internet and its distribution, information and competetive enhancing capabilities, globalization, the leaps forward in production automation and supply management that have made it more apparent. Before that many of the indicators suggestive of such changes (for example, the entire free software phenomena) would have been impossible.

Basically it boils down to the number of manhours needed to come up with, produce and distribute the goods for which there is a demand. Food as the basic unit, various comfort items ranging from housing through housework automation, and after that, entertainment and 'knowledge'. The recent advances have rapidly cut into the costs of these factors.

Worst case, an ever shrinking number of people still involved in actual value-creating work (directly or indirectly involved in creative and development work, unautomatable service work, production and productivity enhancing measures) will have to support an ever growing number of unemployed or artificially employed (government make-work, a fair amount of various areas of the legal profession, many marketing related jobs, and similar where there is no actual demand for the product of the work itself, but it becomes viable or necessary through market distortions like the protected monopolies derived from intellectual property) through taxes, ever more expensive social security and insurance systems and vastly overpriced products of the protected sectors.

In that case I'd expect a certain level of, shall we say, social discontent, from both sides.

Best case, in my opinion, and similar to changes during the shift from agriculture to industrialized society, we spread the work around a bit more evenly instead, thus lowering the costs of the social systems (unemployment, retirement, stress-related disorders, etc), and reap the fruits of our ever increasing productivity by working fewer hours instead, and getting more time to actually consume.

Maybe I'll write it up more throughly and coherently eventually, but I'd have to throughly go through some more legitimate research then.

[ Parent ]

Yes, between 'everyone works' and 'noone works' (none / 0) (#95)
by jongleur on Mon May 23, 2005 at 11:43:59 PM EST

is a hard-to-deal-with transition period. It falls between two appealing ways of looking at things and we've never been in this position before. I wonder whether we'll need some new revolution (seriously!) to ring in a new sensibility, going from many poor & a few rich, to everyone pretty well-off. Not necessarily of course, but when money == power it won't necessarily be smooth.
--
"If you can't imagine a better way let silence bury you" - Midnight Oil
[ Parent ]
True... (none / 1) (#99)
by Znork on Tue May 24, 2005 at 04:17:52 AM EST

... and the system is rigged to exacerbate the pain. As long as the economic system directly rewards more work, and only indirectly takes away those rewards through taxation, insurance premiums and high product costs it will definitely appear to be profitable to increase working hours, and it might, depending on tax and cost structures and the value of what one were doing on the free time, also actually be profitable for the individual to do so. And that's completely disregarding things like personal satisfaction and self-esteem tied into work. That system worked great as long as there was more than enough to do, but it's starting to exhibit certain problems.

It's not unsolvable, but it's a very complex problem when you figure in other issues like globalization, as the competetive nature of our system almost makes it impossible to cooperate about something like resetting the competition at a less antagonizing level. It's also very easy to get caught up in related, but only symptomatic, sub-problems and blame things like outsourcing, labour rigidity, minimum wages, slacking youth, etc, and come up with counterproductive solutions like make-work, artificially cheapening labour, and unrelated protectionist measures.

I dont think there will be a 'revolution' really, as long as some remenants of democracy remains, but various extremist philosophies can easily gain traction in strongly polarized societies.

[ Parent ]

You can't think Indians & Chinese are dumb (none / 0) (#39)
by jongleur on Sun May 22, 2005 at 06:54:14 PM EST

so, what's going to keep the US the leader? We're fat, dumb and happy, the Chinese are hungry (though perhaps their culture isn't so conducive to creativity yet). But I don't see any reason we'll stay ahead; we've been both failing to keep up (support for research diminishing AFAIR, losing our attractiveness to foreign students), and even squandering our lead (companies giving intellectual capital to China in order to do business there). Nothing says we'll stay ahead.
--
"If you can't imagine a better way let silence bury you" - Midnight Oil
[ Parent ]
They certainly aren't dumb... (none / 1) (#79)
by skyknight on Mon May 23, 2005 at 04:47:21 PM EST

However, their legal systems are light years behind that of the United States. The consequences of that are crippling. Corruption is rife, at a level that makes the worst of what happens in the US look like child's play.

It's not much fun at the top. I envy the common people, their hearty meals and Bruce Springsteen and voting. --SIGNOR SPAGHETTI
[ Parent ]
Soviet Union counter-example (none / 0) (#111)
by jongleur on Tue May 24, 2005 at 11:15:50 PM EST

They didn't have our free market + rule of law, but totalitarian govts can direct energy wherever they want. They're not a competitor now but they were for most of the 20th century. Too, the lid may come off the Chinese, though what that would look like I can't guess. I get the sense that it's conventional wisdom that the direction is equalization between the rest of the world and us. Both of those cultures value education, and the govts are willing to take special steps to encourage high-tech industry. You make a good point about our system though.
--
"If you can't imagine a better way let silence bury you" - Midnight Oil
[ Parent ]
Think about what kept the Soviet Union running... (none / 0) (#121)
by skyknight on Wed May 25, 2005 at 01:03:08 PM EST

They had a massive and ruthless secret police organization that made the FBI look like high school dance chaperones by comparison. They had slave labor on an enormous scale, largely fueled by political prisoners, a system that makes the US's prison-industrial complex look like a cottage industry by comparison. And in the end, it wasn't even sustainable. The whole thing was shrouded in lies, fraud and accounting scandals that made Enron look like a saint. The Soviet Union only worked to the extent that it did because of the terror campaign unleashed by the government on the citizenry, and such a thing cannot work in the long run, at least my heart hopes that it can't.

It's not much fun at the top. I envy the common people, their hearty meals and Bruce Springsteen and voting. --SIGNOR SPAGHETTI
[ Parent ]
Also worth adding... (none / 0) (#122)
by skyknight on Wed May 25, 2005 at 01:12:35 PM EST

is that a major problem with such totalitarian systems is that, while they can direct energy wherever they want, they tend to put all their weight behind whatever decision is made. If it's a catastrophically stupid decision, then the results are, well, catastrophic. In free market systems there is duplication of effort, and there are dumb ideas put forth, but the fact that there are competing ideas means that stupid ideas will (usually, hopefully, when the system is not corrupt) be punished. As such, in free market systems ideas follow an evolutionary path. In totalitarian systems, no such evolution is possible. If the government settles on something really stupid, then that's that. The thing is, the initial ideas and concepts for anything are primitive and stupid. Complex problems need iterative, evolutionary solutions if a reasonable measure of success is to be attained.

Consider, for example, some of Stalin's more ridiculous engineering projects. There was some canal project, whose name I forget, that is famous for having taken forever, cost a fortune in money and lives, and ended up being completely useless. The only reason it wasn't abandoned was that Stalin thought it was a good idea, and nobody in their right mind would have told him otherwise, as to do so would have meant death or life in a labor camp, perhaps ironically working on precisely such an idiotic project. Another good example is the stagnation of Chinese scientific progression. For a long time scientific and economic progress was occurring in China at a decent clip. This was occurring while "China" was a collection of frequently warring states. However, as soon as things became incontrovertibly solidified, progress stagnated as the result of stupid decisions by a single all powerful emperor.



It's not much fun at the top. I envy the common people, their hearty meals and Bruce Springsteen and voting. --SIGNOR SPAGHETTI
[ Parent ]
lol. (none / 1) (#130)
by pb on Thu May 26, 2005 at 02:21:18 AM EST

There was some canal project, whose name I forget, that is famous for having taken forever, cost a fortune in money and lives, and ended up being completely useless. The only reason it wasn't abandoned was that Stalin thought it was a good idea
Was it called 'The Big Dig'?
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]
I don't think you quite appreciate... (none / 0) (#136)
by skyknight on Sun May 29, 2005 at 08:25:18 AM EST

the scale and madness of Stalin's projects, or you wouldn't make the comparison.

It's not much fun at the top. I envy the common people, their hearty meals and Bruce Springsteen and voting. --SIGNOR SPAGHETTI
[ Parent ]
no, I do... (none / 1) (#138)
by pb on Mon May 30, 2005 at 12:08:31 AM EST

Obviously many more people died under Stalin--but if you had instead paid those people minimum wage over that duration, I The Big Dig ends up being quite a bit more expensive. My only point here is that America's economic system isn't immune to the sort of ridiculous excesses that you decry. However, it's nice to not have people dying in our construction projects, even in the way they did when, say, Chinese laborers were building our railroads.
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]
WIPO: (3.00 / 5) (#21)
by localroger on Sun May 22, 2005 at 10:59:41 AM EST

The Handmaid's Tale

I am become Death, Destroyer of Worlds -- J. Robert Oppenheimer
Hell yes (none / 1) (#25)
by spasticfraggle on Sun May 22, 2005 at 12:02:53 PM EST

That would be a poll option deserving of a <blink> tag and giant neon signs pointing at it whilst a choir of silver ring wearing cherubims with disconcerting red eyes sing "You voted for our Lord and Master - Twice".

--
I'm the straw that broke the camel's back!
[ Parent ]
[o] (none / 0) (#69)
by Spendocrat on Mon May 23, 2005 at 02:17:27 PM EST

Summary

[ Parent ]
Ok chickenlittle... now what?! (none / 1) (#37)
by neozeed on Sun May 22, 2005 at 06:46:54 PM EST

Of course we are on a collision course with disaster... but do what?! How did the romans deal with their inement collapse....?

-----------------------
Unless you're alive you can't play. And if you don't play, you don't get to be alive.

They didn't. (none / 0) (#68)
by Nosf3ratu on Mon May 23, 2005 at 02:03:25 PM EST




Woo!
[ Parent ]
do not worry about the future, citizen (none / 0) (#41)
by SIGNOR SPAGHETTI on Sun May 22, 2005 at 07:32:27 PM EST

we will open new wounds the better to take our minds off the old ones

--
Stop dreaming and finish your spaghetti.

Back in the game. (2.75 / 4) (#45)
by Ryan Singer on Sun May 22, 2005 at 08:55:30 PM EST

I'm not sure I like the assumptions I am guessing you are starting with, but I'll bite and talk about your issues.

The Current Accounts Deficit - This is not a trade deficit, because such thing is theoretically impossible.  Remember that dollars are effectively the same thing as treasury notes, if you sell things for dollars, and then put those dollars under your mattress, the US benefits.  So, every year of the Current Accounts deficit, we have, by definition a Capital Account surplus.  Basically, we only have a Current Accounts deficit because everyone invests in (purchases with foreign currency) United States Dollars, so we buy goods with that foreign currency.  Once the rest of the world decides to stop investing in America, the CA deficit will go away.

The National Debt - Scary.  The public sector is incapable of making the kind of investments that would make borrowing money worth it.  We should stop entirely, and start paying it off.  The only expense that the public sector needs to invest in is security, lets divest ourselves of social programs.

Interest Rates - are under the direct control of the fed, and are not really an indicator of anything such as they are.  Interest rates are going up because the fed wants them to in case of inflation.  Not scary at all.

Job Growth - Do your part, start a resteraunt.  Job growth is driven by small business, not government.

China and their currency - China would see huge gains from floating their currency, because they wouldn't have to spend to maintain the peg.  We really don't care.  The Exchange rate with china and the trade in Chinese goods will be determined by supply and demand, if chinese goods are too expensive there are starving people elsewhere willing to make our sneakers without it costing too much more.  We have a CA deficit before China embraced free trade.

Government Expenditures vs. Income - Again, Government is incapable of investing in value.  They need to back off to the things that have a need for them, like defense.

Taxes and Tax Reform - Good idea.  A consumption based tax would kill the wasteful tax avoidance industry and encourage investment instead of luxury consumption.  This is thinking on the right path.

Social Security - The problem is that the Social Security Trust Fund is invested in treasury bonds, it's like investing in your checking account.  This needs to be invested elsewhere, either in stocks or in foreign bonds.

Defense Spending - This is governments job, we should argue for transparency, but I am much more concerned about the more wastefull things the government does.

Transportation - Ouch!  Nobody spends capital.  If you are spending it, it's money.  Capital is invested.  Gas is expensive enough that I am considering a Hybrid vehical.  That is how the market handles things.  This is not scary, it is just supply and demand.  I am scared of the government trying to fix it though.

Health Care - The Government has really fucked us here by building a third party payer system in America.  This needs to be dismantled.  Perhaps people should keep health savings accounts instead of insurance?

Energy - Over-regulation is a huge problem here.  We need to regulate the pollution aspect in a measureable way.  Stupid bias against Nuclear energy keeps horrible fossil fuels when Nuclear power is cleaner and cheaper.  Once pollution is regulated, preferably with Cap and Trade, and then the other government regulations are repealed, I have no doubts that supply will meet demand.

Infrastructure - The government sucks at this.  Let roads be finianced and built like the Dulles Toll Road near DC.  Energy should be the province or energy providers, just like cable infrastructure is the province of cable providers.  Have you ever heard of rolling cable blackouts?

In short, I am optimistic about the future of the American market.  I will feel better if the government takes more of a regulatory and less of an active role.  I am not scared by police or military spending, it's why we have a government.

you know... (3.00 / 2) (#52)
by pb on Mon May 23, 2005 at 01:40:23 AM EST

Although I'm intrigued by your response, I don't really see how all the pieces would fit together here. Maybe you could clarify a few points for me. Also, thank you very much for taking the time  to elucidate your views.

"Basically, we only have a Current Accounts deficit because everyone invests in (purchases with foreign currency) United States Dollars, so we buy goods with that foreign currency.  Once the rest of the world decides to stop investing in America, the CA deficit will go away."

That's one of the things that worries me. Let's say other countries decide that dollars are a bad bet, and they stop investing. What happens to the dollar--rampant inflation? Where do we get the extra $2 billion dollars a day?

"The National Debt - Scary.  The public sector is incapable of making the kind of investments that would make borrowing money worth it.  We should stop entirely, and start paying it off."

Let's say we do stop entirely and start paying it off (we were, briefly) -- where do we get the money from?

"The only expense that the public sector needs to invest in is security, lets divest ourselves of social programs."

I think that would hurt far more than it would help. However, I suppose it would be a quick and easy way to raise income inequality, and push the US closer to third world status.

"Interest Rates - are under the direct control of the fed, and are not really an indicator of anything such as they are."

Maybe they are now, but that doesn't mean that they always will be. See the first point about "Once the rest of the world decides to stop investing in America".

"Job Growth - Do your part, start a resteraunt.  Job growth is driven by small business, not government."

lol. I would if I could. Not that restaurants tend to be terribly successful. No, another failed restaurant just means that someone else managed to pay people for a while at the expense of a bank loan gone bad. Sort of a microcosm of a lot of issues that we face.

"China would see huge gains from floating their currency, because they wouldn't have to spend to maintain the peg.  We really don't care."

Well maybe you don't, but I do. Again, this goes back to the first point. If China floats their currency, they won't have to buy dollars from us, and fund our debt. Maybe other people will buy the yuan instead.

"Government Expenditures vs. Income - Again, Government is incapable of investing in value.  They need to back off to the things that have a need for them, like defense."

What makes you think that the government makes good investments in defense? That seems like one of the most corrupt and overvalued sectors we have, precisely because of government involvement. Their accounting was so bad that they literally couldn't account for $3.4 trillion dollars over a two year period of reviewing the books. Where did that money go? We have no idea.

"Taxes and Tax Reform - Good idea.  A consumption based tax would kill the wasteful tax avoidance industry and encourage investment instead of luxury consumption.  This is thinking on the right path."

I think so. Although I would like to be sure that whatever consumption tax is chosen is progressive enough to not tax the lower and middle classes more than they already are being taxed now, the FairTax is at least nominally a progressive one.

"Social Security - The problem is that the Social Security Trust Fund is invested in treasury bonds, it's like investing in your checking account.  This needs to be invested elsewhere, either in stocks or in foreign bonds."

Actually it's more like an IOU to the government in the form of a regressive tax--but that's just because the Social Security 'surplus' goes into the general account. Investing it elsewhere may or may not help depending on the investment, but it'll ultimately just create another bubble--we'd have a big problem when the baby boomers cash out.

"Defense Spending - This is governments job, we should argue for transparency, but I am much more concerned about the more wastefull things the government does."

I guess I covered this one already--defense spending can get pretty wasteful. It accounts for far, far more money and pork than the "non-defense, non-discretionary spending" that was recently cut (not even adjusting for inflation).

"Gas is expensive enough that I am considering a Hybrid vehical.  That is how the market handles things.  This is not scary, it is just supply and demand.  I am scared of the government trying to fix it though."

I don't see why--often, markets need encouragement to do the right thing. The very reason that CAFE standards aren't helping our gas consumption as much as they used to are because of the exemption for 'light trucks' (then jeeps, now also SUVs) that allowed car companies to be both more profitable and less fuel efficient. Instead of the government 'fixing' things, you end up with corporations lobbying for ways the government can 'break' things in their favor. Free market? The market doesn't always magically look out for your best interests.

"Health Care - The Government has really fucked us here by building a third party payer system in America.  This needs to be dismantled.  Perhaps people should keep health savings accounts instead of insurance?"

The whole point of insurance is to be there for you when you can't afford it. I might come out ahead on a health savings account; someone else might come out woefully behind. It's no guarantee of security. No, the problem here is the cost itself--especially for the uninsured--which has been pushed up a great deal by the insurance industry.

"Stupid bias against Nuclear energy keeps horrible fossil fuels when Nuclear power is cleaner and cheaper."

I think that's true to some extent, although nuclear energy is more expensive in the long run than you'd think--it has large up-front costs, and serious waste-disposal considerations. However, while the plant is running, it is quite cheap. Also that Three Mile Island thing spooked people; I'd hate to see less safe nuclear power plants come online.

"Energy should be the province or energy providers, just like cable infrastructure is the province of cable providers."

Aren't they both essentially local monopolies?

"In short, I am optimistic about the future of the American market.  I will feel better if the government takes more of a regulatory and less of an active role.  I am not scared by police or military spending, it's why we have a government."

Let's hear it for optimism. I'm fine with the government taking a regulatory role to keep things moving along smoothly, and taking an active role when something really needs fixing. Of course, the goals here are, "don't fix it if it ain't broke", and, don't break it even further than it already is. Which isn't always achieved, but I think that sometimes the government does get a bad rap for the things it does that actually do turn out ok.

As for military spending--I'm all for having a military, but I think we need to seriously look at the spending. All too often it just looks like a blank check, with no accountability. I doubt we'd have to spend much on auditing to recover billions here, and hopefully put procedures in place to keep saving that much and more in the future.
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]

too much faith in the cable company (none / 0) (#80)
by mpalczew on Mon May 23, 2005 at 04:58:34 PM EST

> Have you ever heard of rolling cable blackouts?

yes.  Do you live in some kind of magical land where  cable tv never goes out.  

I wish we could have some competition between electric companies but it ain't gonna happen, just like there never was competition between cable companies untill satelite.  You can't beam electricity.

I think the government neads to stop pandering to big business.  Small business is where it's at.
-- Death to all Fanatics!
[ Parent ]

I love seeing people deny the obvious (1.66 / 6) (#56)
by Peahippo on Mon May 23, 2005 at 04:30:09 AM EST

As long as society assumes the mantle of Fascism, the destruction of the middle class will go almost unnoticed. It'll be kind of like when a working middle class neighborhood goes Black. All of a sudden, a generation passes and it's Crackhouse Lane with crowds of Blacks. The few oldster Whites remaining on the street will lament "what happened?", but all the mobile yuppies will be too busy catching new STDs to ever notice them ... until they end up in their own newly-made ghettoes, saying the same "what happened?" in the same high-pitched whiny voices.

America is slowly but firmly sinking into the mire of Fascism. It's the most natural thing in the world. First you have the Republic, then it decays out of fear and greed, and then people get jailed for virtually anything stupid you can think of. It becomes an Empire, and must flex its military dick since it has no prosperous economy to fall back upon otherwise.

And then it ends. All Empires collapse. It can be a bang or a whimper, but one day people will have as little concern for the "United States Government" as they do for Andorra's government. The onus for World Leadership will pass to another fucking Empire, like China.


I agree with the fascism part of your post (none / 0) (#62)
by Have A Nice Day on Mon May 23, 2005 at 08:03:21 AM EST

but other than that you're a racist fuckhead.

--------------
Have A Nice Day may have reentered the building.
[ Parent ]
I knew that ... (none / 0) (#115)
by Peahippo on Wed May 25, 2005 at 01:51:49 AM EST

... I'd be able to troll a liberal piece of shit by ever bringing up ghettoization -- which I can watch any time I please in my hometown, Toledo ... or is merely observing such "racism"?

The liberals have thoroughly discredited themselves by destroying the environment for discussing racial issues. So, go ahead and wallow in the stupidity of your own making. I stand by my statements 100%. Ghettoization is real, and Blacks are at the forefront of it ... although Whiggers are playing an important part.


[ Parent ]
Your experience... (none / 0) (#123)
by mbmccabe on Wed May 25, 2005 at 01:18:39 PM EST

Peahippo,

I would not attempt to deny your experience as I don't have a basis for doing so.  Hard to imagine anyone else here does either unless you have acquainences or neighbors hanging out here.

Further, I like the implicit attitude of being anti-PC at least for the sake of discussion (even if that's all).

What you're talking about has another word as described from the other side:  White flight.

There's no mystery about whether the two happen or have happened..it's a fact.  It's where we got suburbs!

All that said, your material criticism (would like to see more depth of explanation, additional examples other could possibly relate to better) seem to be slanted to blaming the victims.

Whatever role the victims (all sides) surely played in their own outcomes, it probably doesn't help us much knowing about it without knowing about the driving factors in the environment.  

Complaining about the effects (white flight, ghettoization, etc) without understanding the cause(s) (racism, telecom boom, changing economy, etc) seems hollow.

Knowing and talking about both causes and the effects is one way we learn about ourselves and grow.

So...from your experience, knowledge and perspective, what were/are the factors playing into the ghetto-ization in Toledo?

[ Parent ]

please post examples (none / 0) (#81)
by mpalczew on Mon May 23, 2005 at 05:03:06 PM EST

> First you have the Republic, then it decays out of fear and greed, and then people get jailed for virtually anything stupid you can think of. It becomes an Empire, and must flex its military dick since it has no prosperous economy to fall back upon otherwise.

Ok, this happened to the Romans.  Please show other examples.  

I can think of one, the British, and they ended up just fine.  
-- Death to all Fanatics!
[ Parent ]

That you could not ... (none / 1) (#113)
by Peahippo on Wed May 25, 2005 at 01:43:02 AM EST

... immediately have produced the example of the Weimar Republic, only emphasizes how you refuse to think of the United States as an Empire. So, go away. I refuse to be baited by people pulling the "history doesn't prove that" MYTH.


[ Parent ]
ror nt (none / 0) (#120)
by mpalczew on Wed May 25, 2005 at 12:26:00 PM EST


-- Death to all Fanatics!
[ Parent ]
My God! (none / 0) (#107)
by Jazu on Tue May 24, 2005 at 12:23:07 PM EST

Black people are fascism! Of course! It all makes sense now!

[ Parent ]
Bzzt! (none / 0) (#114)
by Peahippo on Wed May 25, 2005 at 01:44:50 AM EST

FALSE ASSOCIATION. You failed the logic test. Go to college for a few more years and come back when you are actually able to THINK in the face of "racial trigger words". Dolt.


[ Parent ]
If this article get voted up (1.12 / 8) (#57)
by ljj on Mon May 23, 2005 at 04:38:41 AM EST

Then this site is dead. How is this 'op-ed'?

--
ljj

What would you suggest? (none / 0) (#65)
by pb on Mon May 23, 2005 at 09:33:51 AM EST

Personally I think this site has been stillborn for a while now. However, if you had wanted to contribute to its life, you could have done so in the 24 hours when this article was in the Edit Queue.
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]
If parent comment is not zeroed (hidden) (none / 1) (#73)
by NaCh0 on Mon May 23, 2005 at 02:56:01 PM EST

Then this site is dead. How is this editoral comment posted topical?

--
K5: Your daily dose of socialism.
[ Parent ]
Cracks in the Empire. (3.00 / 3) (#58)
by RobRoy on Mon May 23, 2005 at 04:55:28 AM EST

A greater depth of the economic stability of a power can be inferred by the desperation of its foreign policy, and the paranoia of its internal security.

At the end of World War Two, every other power in the world had undergone significant infrastructural damage and there was nothing that could have stopped the USA from taking over the world.

However at that time it was not on the agenda. In 1956 the USA forced an end to the British and French invasion of Egypt with diplomacy and economic threats.
How differently we see USA now. Very brutal invasion of the Afghanistani route to the oil and gas of the Caspian sea, and followed by a unashamedly illegal invasion of Iraqi oil-fields. Nothing resembling the Geneva Convention is even given lip-service when prisoners are taken and internal freedoms of movement and speech are rapidly eroding.

We seeing a country fighting for its life, even if we don't understand what the immediate threat is.

The decision to let the value of the greenback slip, (probably in response to the Chinese pegging the Quai to the Greenback at 8.22), is going to have an intellectual toll as the best of the best move to Europe where the pay is better. I don't see China acquiescing to USA pressure to float the Yuan though. History shows that the world's two biggest powers go to war, so in the medium term, a policy that weakens America's economy is just as good for China as one that strengthens its own.

However, USA is a great place to run a business. Employee's have much less protection than in most countries, and the limits of the welfare state and the public education system ensures the existence of a local underclass, in this peculiarly American thing, the tenement house, that can provide inshore cheap labour.

There cannot be much doubt that the next 20 years will show a drop in the median standard of living in America. Strong-arming of increasingly ridiculous copyright laws throughout the world will slow the decline, but not halt it.

However a drop in the mean standard of living probably won't affect the middle classes much.
And 10 years will still see a strong and cohesive America;
just entering a new cold war with China (or possibly India, but I doubt that because they will not have efficiency towards the small business until they find a system to centralise the corruption similar to the American way), and continuing to struggle with Europe for royalties and licence monies, on increasingly dated technologies. (And cartoon mice).
Foreign debt will still be growing cheerfully.
Social Security will be a little eroded, and America will be concentrating its increasingly burdensome armed forces in the resource-rich parts of the globe. Perhaps an invasion of Iran.
Unemployment will not sky-rocket, but the mean wage will slump a little in response to slightly increasing unemployment.
America has spectacular infrastructure. Probably the best in the world. It can slip a mountainside and not directly affect Americas place in the world.
Holding out against the Kyoto Protocol will keep road transportation cost down to the lowest in the first world. This will work for 30-40 years before it significantly affects you trade agreements.

China the world power (3.00 / 2) (#59)
by nebbish on Mon May 23, 2005 at 05:57:36 AM EST

Doesn't anyone realise that as a dictatorship China probably faces a lot of destabilising political turmoil in the future?

---------
Kicking someone in the head is like punching them in the foot - Bruce Lee

Singapore (none / 1) (#67)
by RobRoy on Mon May 23, 2005 at 12:22:48 PM EST

Hasn't hurt Singapore yet.

[ Parent ]
singapore is one small city (nt) (2.50 / 2) (#71)
by circletimessquare on Mon May 23, 2005 at 02:39:15 PM EST



The tigers of wrath are wiser than the horses of instruction.

[ Parent ]
but it is a fine city (none / 1) (#125)
by Phssthpok on Wed May 25, 2005 at 04:05:11 PM EST

get it "fine" lol
____________

affective flattening has caused me to kill 11,357 people

[ Parent ]
It's not a dictatorship (none / 1) (#106)
by ghjm on Tue May 24, 2005 at 09:43:10 AM EST

It's much more authoritarian than the U.S. has traditionally been, and it can't really be described as democratic, but a dictatorship? Who's the dictator supposed to be?

China is an example of one-party rule in an otherwise reasonably functional constitutional process. If the U.S. Democratic Party continues its collapse, the next generation of Americans will get to experience this first-hand.

-Graham

[ Parent ]

the only problem with this analysis is that (3.00 / 2) (#72)
by circletimessquare on Mon May 23, 2005 at 02:45:37 PM EST

the us is so plugged into the the world economy that it begins to be such that you can't talk about one without talking about the other

such that where the us suffers, the world suffers, and visa versa

and that is the way it should be, really, and should be for all world societies: less war is the result of more interdependence

now you COULD extrapolate to the future where the us economy is a lot weaker than it currently is

except that the only problem there is you are forgetting another trend: the further and further interdependability off the world economy

my point being is that as the us might grow weaker, at the same time the new trend of further and further interdependability offsets that

so the fate of the us economy is the fate of the world economy

so there is no reason that you can talk about one without the other

and not that this is an american-centric observation: you could say the same thing for every other major economy in the world

and this is not a bad thing: globalization is not bad, it's good

one economy, one standard, leads to less mismatch in standards of living from one society to another, and therefore less inequality and less geopolitical conflict

rich democratic societies with strong economic interdependence don't really have any reason to fight one another


The tigers of wrath are wiser than the horses of instruction.

Globalization is reversible (none / 1) (#75)
by srutis on Mon May 23, 2005 at 03:56:48 PM EST

As demonstrated in early 20th century before WWI. And, I believe that even today it could happen. It's a basic reflex to close down the borders when things go to hell, irrelevant of how the economy will be doing after that.

[ Parent ]
what globalization before wwi? you're nuts (nt) (none / 1) (#88)
by circletimessquare on Mon May 23, 2005 at 07:03:27 PM EST



The tigers of wrath are wiser than the horses of instruction.

[ Parent ]
That was (3.00 / 2) (#100)
by tetsuwan on Tue May 24, 2005 at 05:16:51 AM EST

national agents in an international market. While it is true that the economy in the late 19th was globalized to quite an extent, it was mainly trade with colonies. This continued in the early 20th century. The end of th 19th century also saw a tremendous nationalistic industrial effort, so that almost every western economy started to produce the same high tech products such as trains, cars, telephones and (later) radios.

I don't think this can be done in the same manner with the high number of multinational agents. Also, a lot of countries are not nearly self-reliant on foodstuff and energy.

Njal's Saga: Just like Romeo & Juliet without the romance
[ Parent ]

You're right (none / 1) (#83)
by bradasch on Mon May 23, 2005 at 05:18:10 PM EST

You're right when you say that a bad turn in the economy of the US will bring down the economy of the rest of the world, and simply because the US are a supereconomy, and a lot of countries are very dependent on that. It's my opinion that this situation is a bad thing.

But a weaker US economy would be beneficial to to rest of the world, simply because it would balance the interdependability. Today, the scales are off, and that's why a recession in the US causes so much trouble in the world (well, certainly it causes more ripples on the world than, say, a recession in Brazil).

"one economy, one standard, leads to less mismatch in standards of living from one society to another, and therefore less inequality and less geopolitical conflict"

That is true, but for that to happen it would be necessary for us humans transcend nationality. I don't see that happening too soon.

"rich democratic societies with strong economic interdependence don't really have any reason to fight one another"

And that's why you don't the US bombing Canada, or France, or any other rich democracy. But that isn't inclusive enough to make the world as a whole richer, nor to diminish the discrepancies between rich and poor.

A good solution would be to be to equalize the economies in the world, increase and balancing the economic relationship between countries. Extrapolate that and you would have only one economy, with even dependency between any given unit in the world.

But I guess this is too socialist for today's reality, unfortunately.

[ Parent ]

the problem with your approach (none / 1) (#86)
by circletimessquare on Mon May 23, 2005 at 05:38:51 PM EST

the point is not to drag down the rich economies to the levels of the poor economies

the point is to pull up the poor economies to the levels of the the rich economies

in order to do that, the most amount of work and effort required is by those in the poor economies

now i can give $1 trillion dollars to a poor country

but at the end of the day, that leaves us with a bunch of corrupt officials with large villas, and not much change in the countryside

in order to narrow the gap between rich and poor, the most amount of effort that has to be done is by those in the poor country

no amount of money from the rich countries will change that fact, however unpalatable that fact remains to you


The tigers of wrath are wiser than the horses of instruction.

[ Parent ]

Correct (none / 1) (#90)
by bradasch on Mon May 23, 2005 at 08:29:58 PM EST

"but at the end of the day, that leaves us with a bunch of corrupt officials with large villas, and not much change in the countryside"

I know that. But you see, it's much easier to get richer than to get rich. So we need to find is a way to develop poor countries without giving them money. This is not what we are doing today.

"the point is not to drag down the rich economies to the levels of the poor economies"

That would be the ideal. But how much could we drag down just to eliminate waste and opulence, without really affecting the the rich? It's far fetched, I know, but I've always wondered that. And I'm talking about the internal discrepancies of a poor country, not between a rich and a poor country.

You see, I know corruption is the worst plague to infect any humanitarian effort, but even corrupt social programs benefit a lot of people. In a perfect situation, all money would be put to good use, and maybe that's what we really should look for, what we should aim to.

So, that's the problem with your approach: while the poor strugle with their limited capabilities to make something better (and a lot really fight for that), rich usually say "well, he would expend it all in beer anyway", and do nothing.

Doing nothing never makes anything better.

[ Parent ]

very true (none / 1) (#103)
by circletimessquare on Tue May 24, 2005 at 08:28:34 AM EST

but you are talking about the spirit of charity, not governmental policy

the ideal situation is that the rich would give to charity freely

they don't: people are shallow and self-centered, rich and poor

so the government comes in and taxes the rich at a higher rate

but unfortunately, the rich have MONEY which means they can buy freedom for their money: put it in another country

you can't tax the rich to a high extent in small national petri dishes: the rich just flee their money to a more rich-friendly dish... bermuda, the caymans, bahrain, etc.

so that is the beauty of globalization

nowhere for the rich to run to ;-)

we should see in the future at some future date the ability to throttle the rich: some sort of upper limit on personal wealth, and lower limit on personal wealth (well, that's hard to enforce, so really what i mean is stronger social safety nets)

in a more tightly knit global environment, you can begin to talk about such things

you can't even being to talk about such things with nationalism: the rich just leave and take their money

in an ideal (global) society, a rich man's grandchild and a poor man's grandchild should turn middle class at equal rates

and also in an ideal society, a rich man should never be 100x richer than the same (global) society's poor man... within reason, some people are just hoplessly destitute, but we're talking about the able minded able bodied poor who desire to better themselves, whose impediment is nothing but their own ambition or lack thereof


The tigers of wrath are wiser than the horses of instruction.

[ Parent ]

i hate to say it (2.00 / 2) (#117)
by bradasch on Wed May 25, 2005 at 08:06:13 AM EST

but i happen to agree with every word you said.

*ducks and run for protection*


[ Parent ]

opulence (none / 1) (#108)
by Jazu on Tue May 24, 2005 at 12:30:49 PM EST

That would be the ideal. But how much could we drag down just to eliminate waste and opulence, without really affecting the the rich? It's far fetched, I know, but I've always wondered that.

Advertising is tax deductable as a business expense. Advertising creates false needs in people's minds, so they buy things they never would want or miss without the advertising. The media probably contributes, by encouraging fear about crime, terrorism, or health problems, and providing more stupid needs for people to satisfy through buying.

If our consuption was suddenly limited to things that there is a real benifit to having, the economy would tank.



[ Parent ]

what bullshit (none / 1) (#110)
by circletimessquare on Tue May 24, 2005 at 05:29:23 PM EST

you attribute blame to advertisers attributes of basic human psychology

your mode of thinking about the human condition is the same kind of "the devil made me do it" bullshit with blaming videogames for violence or pornography for rape

as if in 1000 BC no one raped or murdered anyone

get a grip retard: WE BUY SHIT BECAUSE WE WANT TO, ADVERTISED OR NOT

look at your fellow man: you find in his heart- nature, not nurture, the root of the evils you see in advertising

wake up

The tigers of wrath are wiser than the horses of instruction.

[ Parent ]

Not really (none / 1) (#118)
by bradasch on Wed May 25, 2005 at 08:12:25 AM EST

Everyone has responsabilities. Advertising is not a way to exempt yourself from thinking.

The problem is that modern society accepts exagerated consumption as a model. Everyone wants to be rich so they can buy 4 expensive cars, even though you only need a cheap one.

If consumption was limited no needful things, economy would provide better, cheap needful things.

[ Parent ]

different mode of taxation (3.00 / 5) (#82)
by fourseven on Mon May 23, 2005 at 05:10:03 PM EST

here's an idea.. since voting doesn't really work anymore in america, and taxes are a) a fucking bitch, b) misused by those whom the "voting process" puts in power to do so, how about considering a scenario that fixes both issues by putting them upside down and mixing thoroughly?

let us vote with our taxes. each year around tax time, everyone eligible receives a big fat form full of options. you get one for federal taxes, and one for state taxes. maybe even one for local (municipal, whatever) taxes. on each form, you have a long list of items, and you can put dollar values next to them. the shtick is, you have to give up a certain percentage of your wages (yes, i know, that's halfway to slavery, but one step at a time please), but you get a choice as to where your money goes.

you don't want war? you give the defense department $0 this year. you'd like to see independent energy produced locally? you put some of your tax money towards that. you choose your politicians by how much money you give to support them. maybe you even get to "vote" on key issues with your dollars and cents. forget congress, these fuckers have been bought long time ago. how about each invidual person slugging away at their day job gets to decide what floats and what sinks? don't like the patriot bill? don't give it any money to live off of. you'd like to see a certain piece of legislation pass? you donate to the cause, help make it happen faster.

yes, yes, this would be complicated. how would you keep track of who contributed where and what services should they be awarded/denied? there would have to be some regulation still.. you could not give $0 to the local fire department -- they still have to come and put out your house fire to protect others. but some key things would improve beyond belief.. heavy corporate lobbying and campaign contributions would not have as much effect anymore. people would pay more attention to issues; chances are we would feel more in control of things. stupid fucking shit would go bankrupt, because noone would put their tax dollars towards it.

seems like money does all the talking these days.. might as well put all that talk to a forum that matters.. give everyone a voice equal to their economic contribution, spread out the infuence, hear all the voices. hell, you'd probably see people volunteering to pay more taxes (especially the rich) to get what they care about to the front..

I've considered this before... (2.80 / 5) (#92)
by pb on Mon May 23, 2005 at 11:26:33 PM EST

Although it'd be interesting, I have a feeling that without some level of coordination, some necessary services would be drastically underfunded, at the expense of other things which would be vastly over-funded. Worse, you'd probably just see corporations and perhaps even government institutions funding ad campaigns to tell the average taxpayer what's important. As interesting as that would be to get personally pandered to by special interests for once, I don't think it would be a healthy situation. One final problem (what you allude to at the end) -- we'd end up with a representative plutocracy, essentially one dollar one vote. Therefore, those who control the dollars control the votes.
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]
I've liked this idea... (2.66 / 3) (#93)
by Shajenko on Mon May 23, 2005 at 11:34:12 PM EST

But I wouldn't make it 100% of taxes. I'd make it much lower, since there are a lot of important portions of the government that nobody ever thinks about. Maybe even as low as 1%. It would still be a huge amount of cash that would be directly controlled by the taxpayers.

[ Parent ]
Better idea (none / 1) (#140)
by Nyarlathotep on Tue May 31, 2005 at 05:58:56 PM EST

Your idea is quite radical, so I'm free to discuss an equally radical idea.

Have an absolute constitution which strictly limits the government's power (no giving away money to farmers or airlines), but let the government create other DIRECTLY elected side governments to handle them.  Side governments would get powers to raise money with "user fees," and the federal government would allocate a portion of tax money to all side governments.  Now your idea steps in and adjusts the exact funding.

Its messy to choose the categories for taxpayer allocation, but the situation is simple if the categories are independent ellected bodies.  Such ellections would also make it harder to have too many side governments, i.e. too many governemnt agencies.

Interesting side effects:
1) states could opt out of some side governments.  
2) powerful directly ellected officials in the millitary.
3) war would be VERY unpopular, if the millitary had a "user fee" (tax).

BTW, tax payers would be too unstable for direct control, so I suggest the following system:  Each year each side government gets a precentage of the money.  Next year everyone's "ballot" has that precentage as teh default, but they are allowed to modify it slightly.  So popular side governments work their way up slowly, and unpopular ones work their way down slowly.  Emergencies would be paid for by "temporary national user fees," i.e. the war tax.
Campus Crusade for Cthulhu -- it found me!
[ Parent ]

Cool idea. (none / 0) (#142)
by Kadin2048 on Wed Jun 01, 2005 at 02:10:19 AM EST

I've thought about this before also. I think it'd be a great idea, the only thing I can't quite figure out is how you'd keep different government agencies from wasting vast amounts of income on advertising in order to ensure their funding next time around.

I think you'd generate a staggering amount of waste, because in order to succeed, an agency would need to devote a large portion of it's income to advertising, just because there would be so many things for potential taxpayers to pick from every year...and frankly, people are stupid and would probably neglect lots of things that they use constantly but don't think about if they weren't pointed out to them.  So you'd need to allow advertising in order for the thing to work (or else all the 'assigned' tax contributions would just go to the little special-interest things that people think about), and that would just lead to an 'arms race' wherein agencies competed to out-advertise each other for next year's revenue.

In theory though I love it: it's the most direct application of the free market to government that I've heard of that still retains a Government as such.

[ Parent ]

The big D (none / 1) (#89)
by dageshi on Mon May 23, 2005 at 08:23:34 PM EST

Recent History. Since the .bomb crash the Fed has been printing money at a staggering rate, I believe at the fastest pace in the history of the US. This has had some obvious effects primarily asset prices have continued to appreciate while at the same time all that printing has devalued the dollar. By asset prices I mean stocks, bonds, houses, commodities the works pretty much. All the while during this period the US has been running a large trade deficit, something else which has been contributing to the decline of the dollar, now this is o.k as long as the rest of the world is happy to invest in America. And they have, pretty much every month enough capital has flown into the US to buy shares, bonds and other bits of paper in order to keep everything balanced. I believe the figure is that the US needs to attract 2 billion dollars per day in foreign investment in order to keep things balanced. Now the majority of that buying came from foreign central banks, specifically China and Japan. To put this into context China as of Jan 2005 held 194 billion dollars of US Treasuries and Japan held (wait for it...) 701.6 billion dollars. The Present. Japan and China have stopped buying. Infact they are perhaps slowly selling or letting their Bonds cash out without renewing them. And who's taking u p the slack?? "Caribbean Banking" Otherwise known as hedge funds. Domiciled in the Caribbean for tax purposes, have been buying lots and lots of treasury bonds for the last couple of months. Why is that scary? Because hedge funds move with the wind. They are in and out of markets like "locusts" as and when the chance offers itself. Now China and Japan themselves could if they decided to sell at once (either of them) do a fair job of screwing the US Gov by selling their bond holdings all at once. They havn't so far because its not in their interests (can't exactly sell stuff to the US if you've just bankrupted the US Gov) So now it's a game of chicken, who is going to break first and sell off their holdings, because the first entity to do it might get some of their money back, the rest... well perhaps not. Lets just hope those hedge funds don't all decide to pile out at the same time. Really lets hope.

money supply inflation (none / 1) (#94)
by pb on Mon May 23, 2005 at 11:40:24 PM EST

I've heard about the hedge funds; I've even heard further speculation that their trading behavior (and the sums of money involved, and the amount that they would likely have lost already) doesn't look like hedge fund activity. One conspiracy theory is that the US government is covertly inflating the money supply (printing dollars, or whatever it takes) to shore up its own situation. Of course this is entirely speculation, and I don't know enough about hedge funds and the alleged secret life of the federal reserve to know one way or the other. But conspiracies aside, it still doesn't sound like a healthy situation, even if it is just hedge fund activity.

So. My question is, given the money to invest, what would be the better bet. Euros, I-bonds or TIPS, commodities, gold, what. I'd want something safe and/or diversified, guaranteed to hold its value, and easily redeemable. Personally I'm thinking of doing some of each, in small increments, as I can. Investing in the yuan (if possible) might be interesting as well, as it is currently pegged to the dollar, but likely won't always be.
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]

DUEED (none / 0) (#101)
by dageshi on Tue May 24, 2005 at 06:13:48 AM EST

I've also heard the speculation about the Fed being the ones doing the buying. If it is, and they get find out the dollar will tank like no ones business. At any rate as to where to stash your cash. There are two probably scenario's I can see at the moment. 1) The dollar continues its current rally and crucifies absolutely every other investment going. To nick a phrase from Mr Chen at http://worldmarkets.blogspot.com this is known as DUEED (Dollar up everything else down). And its likely on the cards. In which case cash (in dollars) and any inflation matching bonds are the way forwards. 2) Scenario one is about to happen but the Fed just can't let it happen and try and inflate their way out of it. Result probably is dollar down, and the rest of the markets trading sideways. If this happens, then Gold and foreign currencies are probably your best bet. As for the yuan question. To be honest I'd go with an Asian TIgers CD from everbank. It doesn't have yuan in it but it has every other asian currency that is currently freely floated, and if the Yuan does float the others will ride up with it, simply because they've been keeping their currencies low in order to stay competetive with China. On the other hand a general mix of everything (currencies, bonds, gold, commodities e.t.c) is not a bad idea. More a case of wealth preservation than creation.

[ Parent ]
Sources? (none / 0) (#105)
by ghjm on Tue May 24, 2005 at 09:30:21 AM EST

Do you have any sources for any of this information?

[ Parent ]
When in doubt, blame the hedge funds... (none / 0) (#119)
by dilaudid on Wed May 25, 2005 at 10:43:11 AM EST

Evidently he doesn't have any sources. In the 70s whenever anyone didn't understand something they would say it was caused by the rich oil sheiks taking positions in the market. Nowadays people say that it is caused by hedge funds.

However hedge funds are too small (at c.$1 trillion invested - mainly in equities, corporate debt, commodities) to affect the treasuries market significantly (c.$7 trillion). According to this article if there are problems in the Hedge Fund market then treasuries (and gold) will do very well.

[ Parent ]

Sources (none / 0) (#126)
by dageshi on Wed May 25, 2005 at 04:35:34 PM EST

http://www.ustreas.gov/tic/mfh.txt You'll notice Japan has decreased somewhat, China is steady and UK has been knocked from it's #3 position by "Caribbean Banking Centers".

[ Parent ]
Critical issue you're missing (3.00 / 2) (#91)
by mckwant on Mon May 23, 2005 at 10:16:49 PM EST

What happens when the Euro becomes the default currency for international finance?

Don't laugh.  One reason the trade imbalance doesn't matter is that the US can always print enough money to get out of it.  Will it cause other problems?  Of course, but the debt will be brought under control.

So what happens when the default currency is the Euro?  Now, the US can devalue the currency all it wants, but the debt won't change.  It's an issue.  not now, but maybe 10 years from now.

BTW, all this screaming about China is a little overrated.  There are already reports of people communicating over cell phones to find the best factory jobs.  The worst factories are having a tough time finding workers.

Sure, the Chinese are inexperienced at capitalism, but they're not idiots.  They'll go through the same growing pains that every other proto-capitalist society has, albeit a little more slowly.

good question. (none / 1) (#96)
by pb on Mon May 23, 2005 at 11:49:31 PM EST

Since our debt is denominated in dollars, any fall in the dollar also ends up being a fall in our debt. On the other hand, that's just another reason for foreign investors to dump dollars. Therefore, they do have some encouragement to switch to other currencies (and the euro done well against the dollar).

Of course, the other side of this is that the rising euro hasn't helped the European export market. However, at least that doesn't matter to them when trading within Europe. And, they also can get cheap imports from China.

The issues with China that I see are two-fold: the trade issue, and the debt issue, and the two are interrelated. Whenever I go over any of these currency issues, it seems to me that without a clever solution, someone is going to get squeezed. But the Chinese are definitely in a position of strength right now.
---
"See what the drooling, ravening, flesh-eating hordes^W^W^W^WKuro5hin.org readers have to say."
-- pwhysall
[ Parent ]

The clever solution... (none / 1) (#137)
by Hatamoto on Sun May 29, 2005 at 05:18:46 PM EST

... is that all the major asian banks have formed a Bellagio group and are moving forward with an ostensibly unified policy. That policy is to slowly divest greenback holdings in such a way so as to not trigger a 'panic sale'. In a panic sale situation everyone loses... but in a slow divestiture, local currency fluctuations can be compensated for by countries in the east asian bloc lending and borrowing cash from each other. The ultimate goal, I believe, is to remove the asian countries from having to be in the situation requiring them to finance american debt in order to stay in a net positive trade position allowing their own growth. This is, of course, a very bad thing for the US, which depends very heavily indeed on those countries to finance consumption. I'm not enough of a prognosticator to clearly see where the US will be in 10 years, but if another catastrophic fiscal failure like the current administration takes over, I suspect terms like 'insolvency', 'runaway inflation' and 'debt spiral' will rapidly become household terms.

--
"Innocence is no defense." - Federal District Judge William H. Yohn (People v. Mumia Abu-Jamal)
[ Parent ]
Euros don't matter (none / 1) (#102)
by NaCh0 on Tue May 24, 2005 at 06:20:24 AM EST

Because as bad as the US economy is doing, Europe is far worse. Unless you think double digit unemployment doesn't mean anything.

--
K5: Your daily dose of socialism.
[ Parent ]
It doesn't mean what it means in the U.S. (3.00 / 2) (#104)
by ghjm on Tue May 24, 2005 at 09:27:56 AM EST

There are two issues to consider when comparing U.S. and European unemployment numbers.

1. The numbers aren't the same. The U.S. reports as unemployed only those people who are actively communicating with a state unemployment office. European countries, generally, report the difference between the number of currently held jobs and the number of potential workers. The two systems result in numbers that are just not comparable.

2. By and large, European countries are more socialist than the U.S. Without debating the merits of socialism, it does at least mean that unemployed people can enjoy a reasonable quality of life. For this reason, widespread unemployment is not nearly as much of a threat to European stability as it would be in the U.S.

There is a lot to criticize in Europe, but widespread unemployment is not their biggest problem. Also, if you're looking at the numbers for Europe-as-a-whole, consider that Germany skews the figures; this is a continuing problem resulting from the reunification of East and West Germany. If you look at other leading European nations (e.g., France, Spain, UK) and adjust for the different reporting methods, you find that unemployment is not materially different from the U.S.

-Graham

[ Parent ]

Your job is toast. (none / 0) (#97)
by crustacean on Tue May 24, 2005 at 01:52:41 AM EST

Mickey D's is starting to tinker with having its orders processed by call centres. What? Yes. You think that they aren't screwing up enough of your orders as it is? Right now, there are Mickey D's in the states where you do not speak to someone in the restaurant when you're giving your order; you speak to someone in another town or state. While they are waxing poetic in their enthusiastic PR spin of this bold development in crappy fast-food service (citing a saving of eight man-hours per franchise per day and call-center workers "elevated communication skills"), it is a smokescreen for the obvious endgame. Your Big Slack order will soon be taken by someone in a Calcutta slum, or Chinese prison. When the North American Blue Collar Working Person complains about jobs moving across the ocean or the border, politicians and economists talk about a changing economy with an increased focus on the service sector and new jobs created by technology. Well, guess what? Big corporations are going to find ways to send even crappy service sector jobs to someone who'll work for ten bucks a week. So if you thought that flipping burgers for five bucks an hour was a bleak but stable future, just wait 'til robots are extruding our mcspewie nourishment and the person at the other end of the speaker doesn't understand the phrase "You f***ed up my order again!" (even if you do reach the same call-centre slave).


Will take to the forest before the oil overlords annex Canada.

As long as they speak English. (none / 0) (#141)
by Kadin2048 on Wed Jun 01, 2005 at 01:59:14 AM EST

People bitch about those Indian tech-support hotlines, but I've never called one and gotten anyone that wasn't totally polite, well-spoken, and competent.

I can't say I've run into anyone recently at a McD's that meets those three qualifications. In fact the last time I went into one (it might have been a BK, I forget), the "Calcutta slum" you talk of was in the back by the fryer. Except I don't think it was Calcutta, it was more like Central Africa, but you get the point. Anyway, much pointing and ordering-by-numbers was involved, because of the language gap between myself and the staff. If someone there spoke fluent English, they sure didn't step up.

If McDonalds can outsource its order processing to India and get me someone I can talk to that speaks English and always says "Good morning," I'm all for it.

It's a sad day when you need an international phone call in order to order a burger, but it doesn't surprise me in the least that we're almost there.

[ Parent ]

Rebuild the tax code to start... (2.50 / 2) (#98)
by Gooba42 on Tue May 24, 2005 at 02:39:17 AM EST

A flat percentage of income tax is fair and reasonable.

It's entirely supportable that the upper tax brackets now receive the majority of the benefit of the government through various forms of corporate welfare, protection from prosecution and legislative favors so I don't see any real problem with the top end of the scale.

At the bottom end of the scale the people with the least disposable income could actually have more money to spend thus stimulating a stagnating economy with more disposable income and making it less difficult to live on a lower wage.

With a simpler tax code the IRS, all associated bureaucracy, and administration costs would be cut out of the loop saving more revenue.

Rebuild the tax code from the ground up, starting with zero exemptions/credits and moving up from there. Offer no room for loopholes or tax dodges.

Once you have the revenue stream sorted out, address spending on a ground-up basis.

Audit our military budget for any "quirks". We're paying for upkeep on unused bases and even upgrades to retired bases now, this sort of thing must be cut out of the budget.

Audit our welfare system both domestic and "refugee". A family in my neighborhood declares $300/mo income from the father's dentistry practice and has a BMW waiting in the garage for when their 3rd grader can drive. They receive these benefits because they are refugees from somewhere in East Asia. Why am I paying for someone else's BMW?

Audit our purchasing and aquisitions system. Open all processes up to competitive bidding and public scrutiny, if necessary creating an approved vendor situation in cases of national security.

Put congress and the president on timecards. Make them accountable to their constituents as much as we possibly can. Eliminate riders on all bills or require the entire process to be restarted with the introduction of a rider, help eliminate corporate feasting on the citizenry's tab by exposing it at every stage.

We can't control the world's demand for our goods or competition for raw materials but we can focus on doing the best, most efficient job possible with our own country and resources. Freeing up some resources in the form of increased revenue and less wasteful spending would go a long way towards making us more independent and allowing us to maintain and/or reform social security and other ailing systems.

Hell, we might even be able to pay for some of these unfunded mandates to go to Mars, to invent some objective way to rate teachers and teach children.

My, you ARE an optimist... (none / 1) (#112)
by tassach on Wed May 25, 2005 at 12:32:42 AM EST

If you think even one of your proposals would actually be adopted.

There are too many people making too much money off the status quo for anything substantial to change, and the people making the money are the ones who are controlling the policy.  Unfortunately these people are either short-sighted or foolish and don't realize that the status quo is unsustainable.

People are stupid.  When the volcano starts smoking, most people look at the plume of smoke, shrug their shoulders, and go on with their lives.  Only a very few will heed the warning, especially if it means inconvieniencing themselves.

There are several different trends (social security, national debt, peak oil) which all look like they're all going to reach the crisis point within a few years of one another.  My gut feeling is that the shit is going to hit the fan somewhere between 2015 and 2020.

"The tree of liberty must be refreshed from time to time with the blood of patriots & tyrants" -- Thomas Jefferson
[ Parent ]

Idealism is important... (none / 1) (#133)
by Gooba42 on Fri May 27, 2005 at 02:09:23 AM EST

If you have no ideals of your own, you'll only wind up living by someone else's.

We must start from nothing and work our way towards perfection, doing it the other way is suicide.

[ Parent ]

Note (3.00 / 2) (#128)
by vectro on Wed May 25, 2005 at 11:06:55 PM EST

that the IRS itself is quite lean; it costs about 15 cents for every $100 that is brought in. The real cost of the income tax is in the private sector; there is an entire industry dedicated to helping individuals and corporations comply with the tax code.

“The problem with that definition is just that it's bullshit.” -- localroger
[ Parent ]
The tax code? (none / 1) (#134)
by JohnLamar on Fri May 27, 2005 at 02:33:27 PM EST

The first thing that needs to be done is revoking the corporate charter of multinational countries. These things have grown out of control and they should be stopped. Their reach into the American political system has made it so you get administrations that are beholden to a few sectors of industry and then we switch every four or eight years. It maybe Oil, Farmers, Steel, whatever. They push their externalities on the governement and we pay up. And by the way, taxes are not the primary source of income for the American governement.

The economic future of America doesn't depend on what the government does, it depends on what they don't do. Well, kinda. We must break up these corporations. Legally they are people and people don't live forever. Divest and sell off their assests. Then we get our government back. Spurs new business.

We are being raped by McDonalds, Wal-Mart and ExxonMobile!

They have to much influence into markets which they shouldn't control. Their lobbies have pushed capitalism on the back burner.

Sorry, I'm a little off today.


The worst thing you've ever seen
[ Parent ]

What Is The Economic Future of the United States? | 141 comments (128 topical, 13 editorial, 0 hidden)
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