Inability to fill appointed positions

[shortridge]

Right now we're admittedly conductin' a big uncontrolled experiment with da economy. Have been since 2008. Anybody who claims to know anything with absolute certainty is just foolin' themselves.

 

Aren't we always conducting giant experiments with the economy? I'm no economist - my eyes began glazing over skimming this thread, to be honest - but it seems to me that no one knows for sure what the economy is going to do, or what unintended consequences an action will have. There are never guarantees - there aren't now, and there weren't back during the days of Hoover and Roosevelt.

 

All we can do is study, guess, bet and pray.

[Beavah]

However, the majority of the country agrees with me in saying that our government is doing too much and needs to shrink. The very fact that they cannot afford their own budget spending every year is evidence of this. The result is that we're buried in a debt none of us will see resolved in our lifetimes.

 

Right now, I reckon it's hard to really claim what a majority of da country thinks.

 

With the Clinton-era tax rates, we were running a surplus. So if yeh just take away the cost of two (now 3) unfunded wars and one unfunded prescription drug plan for seniors, we would be back to affording our own budget spending every year.

 

Does that seem reasonable to you? Go back to the 1990s tax rate (which was lower than the taxes during the 50's economic boom), drop or find alternate funding for Rx drugs, and agree to pay for wars with taxes?

 

I'm all for that.

 

Otherwise, yeh have a choice. Yeh can eliminate Medicare and cut Social Security. Yeh can eliminate the entire defense department and cut Medicare, or yeh can eliminate social security and halve the defense department or Medicare. Nuthin' else matters. To live within our means at the current tax rate yeh have to do somethin' like this. And then yeh still have to raise taxes to pay for the two unfunded wars.

 

So which do yeh choose?

 

The FED is unnecessary. Government was able to fund itself through excise fees, tarriffs, etc. with no income tax for most of our history.

 

Well, for about half of our history. Back then, of course, we also clear cut forests for fuel, strip mined for coal, subjected workers to robber-barons, had such poor sanitation that we had to reverse the flow of rivers to avoid poisoning cities, had no standing army, and traveled on horses along dirt paths.

 

Yeh can return to that if yeh want. Just move to any of a dozen second- or third- world nations. Try Pakistan. You'll get no income tax, no fed, government funding itself through excise fees, a strong military that isn't interfered with by the government, strong religious-based moral values, states that are functionally independent from the national government, the works.

 

We may have avoided a Great Depression II, but we've inherited something far worse. We've inherited a system that is not entirely sustainable in the long term and have gone down the road of borrowing our way into poverty.

 

I'm sorry, I don't see long-run risk as "far worse" than immediate catastrophe. Did yeh really mean that?

 

I agree with yeh, the Fed's balance sheet is preposterous and poses real risks, as does da nation's. But we could solve it by lettin' the Bush tax cuts expire, putting a reasonable excise tax on gasoline, and making reasonable fixes to Social Security and Medicare, especially now that the "Obamacare" plan is pushin' younger people into the insurance pool to reduce costs. Of course I think there are a lot better ways than those, but it's definitely addressable.

 

So in the end what happened is the Fed bought us time to work on the problem, eh? The problem was already there. Rather than accept immediate catastrophe, they bought us time. That's a good thing, if we use it well. Right now, though, the tom-fool idiots in the congress seem to be hell-bent on pursuin' a policy of catastrophe. Better to take the nation down in flames than act like statesmen.

 

Personally I think if the debt ceiling isn't raised by the end of the month President Obama should immediately suspend all business subsidies and social security payments. Tell each member of congress that if they aren't willing to put together a package that combines revenue with cuts then he's suspending all federal funds to entities in their district. Stop fiddlin' around with accounting tricks to hide da congresses' lack of action. Let constituents feel the real pain of what partisan inaction entails.

 

Beavah

 

 

 

 

 

 

 

 

 

[BS-87]

"Let constituents feel the real pain of what partisan inaction entails."

 

How very compassionate of you...

 

In the interest of keeping this short to avoid making anyone else's eyes glaze over. I'll put it simply.

 

The policies undertaken by our government to recover the economy ever since the 1930's have led us to our current point.

 

It is a wound, a big one. The FED has been acting like a bandaid with no disinfectant applied first. The wound is beginning to fester because the bandaid we applied was corrupt and infected because this type of bandaid will always be corrupt and infected. We cannot slowly peel this off, it needs to be in one swift movement which ends up hurting a little bit. We then can look at just how bad our wound really is. Odds are what we'll see is that no nation is meant to monopolize as much of the world's resources as "peacefully" as we do...

[Beavah]

Huh?

 

I don't get the bandaid thing or the 1930s thing. Are yeh referring to Social Security?

 

I think yeh did hit the nail on the head, though, in terms of this thread. Most Americans allow their "eyes to glaze over" whenever it comes to anything that requires expertise. As a result, they're susceptible to charlatans who offer punchy, easy-to-digest slogans that sound good. Some even actively dislike experts who tell 'em things they don't want to hear. They prefer snake oil to medicine.

 

Beavah

 

[BS-87]

I think Social Security could be a great thing! That is if it was run as private accounts instead of a Ponzi scheme. It's really the role of churches and families and communities to pick up the disabled and downtrodden.

 

What I mean is that ever since the New Deal worked for some short term successes and made some great and needed additions to infrastructure, we've had this mentality that the government can always just throw money at any problem and that will solve the problem.

 

You're right though. Americans are perfectly happy to sit back and let their eyes glaze over. The debates on issues today revolve around how people are immediately effected by policy or issues. It's all very selfish and shows that we're the "best entertained and least informed" of any people in the world.

 

When you add it all up, I'm appalled that a guy like JFK with the right idea of "What can you do for your country?" has given way to the idea that wins elections today, "What can your country do for you?"

 

I don't think I'm unfair in saying that we've degraded to that level either.

 

I think we all saw the Obama Zombies on the day after he won the presidency crying and exclaiming how they wouldn't have to pay for anything ever again...

 

 

 

I'm proud that we're all part of a program that teaches the young men and leaders of the next generation of Americans self-reliance and to be the positive force for change in their communities who do not wait around for someone else or their government to make their community a better place to live in.

[Beavah]

I think Social Security could be a great thing! That is if it was run as private accounts instead of a Ponzi scheme. It's really the role of churches and families and communities to pick up the disabled and downtrodden

 

Yah, it should be, eh?

 

But that requires da whole populace to live according to the biblical code, eh? Including tithing 10% of your income to charity. We're nowhere near that, which is why prior to social security such a large percentage of the elderly members of our families lived in poverty.

 

Right now, much of America has switched to private retirement accounts in da form of IRAs, 401Ks and the like. How's that workin' out for most of 'em? If you've been constantly invested in da S&P for the last 10 years your account has gone nowhere. Probably down, actually, given fees. And as more folks retire and draw on those investments, the likelihood of general capital appreciation for da average American is small, eh? So private accounts, too, can be naught but a demographic Ponzi scheme. And that's before yeh get into bankers and hedge funds playin' games at the expense of da average investor, or folks doin' mortgage fraud.

 

These are hard, complex questions, eh? I'm a strong supporter of more local and personal charity and responsibility, and I believe that nations are judged by how they treat widows and orphans and the sojourners in their midst. But da average American gives much less than the tithe demanded by God, fears loss and insecurity more than most other nations, and saves much less than the percentage demanded for providing for their own needs as seniors, or even for da education of their own children.

 

Beavah

[BS-87]

Then the question is ideological then Beavah.

 

Will we improve our situation by giving incentives folks who save, give to charity, and volunteer;

 

Or will we learn best by giving incentives to those who are stuck in less than perfect situations yet make no real effort to pull themselves up by their bootstraps?

 

Surely taxes are seen as a punishment so if we go for punishment should we punish those who save, give to charity, and volunteer; or should we punish those who show no real propensity or will to exist as much more than a ward of the state?

 

We definitely need safety nets, but the safety nets need to be strict without being degrading. If you are in dire straits, there are things you can do to make yourself more marketable as a worker and productive member of society. There is no excuse to expect a free meal from the government. Your local soup kitchen should have more compassion should you continue making bad choices.

 

Taxpayers need to seed government aid as an investment. Consider student loans. There are loans heavily subsidized by the government, but it's an investment because there will be a return with interest.

 

I'm getting long-winded again so I'll boil it down.

 

I don't like the idea of punishing anyone for their situation. Taxation should feel the same to someone who is wealthy as they do to someone who is not. Everyone should expect a certain percentage to be the government's. I do like the idea of giving incentives to those who are the leaders and volunteers and the charitable givers. I do not think it should be a tax relief, but I do feel it should be some form of significant standing. (which when you consider it, the government doesn't even need to give because most strong leaders and volunteers receive ten-fold the kindness and goodwill they share with others)

[Beavah]

Surely taxes are seen as a punishment so if we go for punishment should we punish those who save, give to charity, and volunteer; or should we punish those who show no real propensity or will to exist as much more than a ward of the state?

 

I don't consider taxes a punishment. I can't even imagine an American citizen thinking of taxes as a punishment. Just as we teach the scouts, I consider taxes part of the responsibility of citizenship. I have a duty to pay for the civil society I enjoy and to contribute to its betterment.

 

Yah, it's easy to imagine that there's a lot of folks just achin' to be a ward of the state, eh? Hard to fine 'em IRL, though. Da problem with poverty is that often it doesn't leave yeh with boots, let alone bootstraps.

 

What's an impoverished 75 year old with medical problems to do? A depressed young man struggling with addiction or other mental illness? An underinsured family whose son is severely injured on a scout campout where the only parent has been out of work for a year? A person in Section 8 housing who was never taught by family or school how to save or hold any job other than temping at a fast food joint?

 

Sometimes folks just need help, eh? Nursing care out of pocket costs six figures per year. Medical expenses for a serious injury can exceed that. Life can sometimes exceed a person's or family's ability to cope. And if yeh think the average church congregation takes in enough to assist its members on its own, take a look at their balance sheets.

 

Now, philosophically I actually agree with yeh. But all things in balance, eh? It's important to understand this stuff is complex and there's a fair chance any of us are wrong. And even though I'm a free market, small government fellow, I reckon it's OK that sometimes we pay taxes for things we don't use just because it strengthens the country. Yah, I suppose we could expect rural folks to pay 100 times as much for phone service or electricity or to do without. There just aren't enough customers in rural areas to make it profitable to build out that infrastructure. But I really don't mind da universal service taxes. I want all my fellow Americans to have access to modern services. Yep, that's muckin' with da free market a bit. Probably it's not a good investment in economic terms or da private sector would have done it. But sometimes yeh do somethin' just because it's a good investment in social terms. Yeh just feel it's important for all fellow citizens to have access.

 

Beavah

 

[Beavah]

Yah, SeattlePioneer, I don't think I've said anywhere here that I supported any spending program, other than that I don't mind payin' universal service taxes so that folks in rural areas can have electricity and phone service. Of course, as a scouter, I find myself makin' use of rural and remote phone service on occasion.

 

But I disagree with your notion of taxes as theft. Not paying taxes is theft, eh? In fact, we send people to jail for it. Why? Because taxes are the price we pay for liberty. Freedom is not free. It demands sacrifice, and not just by young men and women in uniform while you and I and da rest sit on our arses. It is an honor and a duty as a citizen to pay our share. In fact, just like we teach the boys, an honorable person not only does his share for the group, he gives extra. Those who want to lead should be an example of generosity and service.

 

Now I get that some whacko survivalist nut-jobs will go "off the grid" and claim to be self-sufficient. But we all know that's bunk. From the guns and tools that they take with 'em to the fact that the U.S. military defends their freedom to be nuts, they are the beneficiaries of a society, and that comes with costs.

 

An honorable man pays his dues to society. On time, and in full, without whining or complaint. If we'd done that with the last two wars instead of expecting our young people and our grandchildren to shoulder the burden with no sacrifice from us, the nation would be much better off.

 

Beavah

(This message has been edited by Beavah)

[BS-87]

"Now, philosophically I actually agree with yeh. But all things in balance, eh? It's important to understand this stuff is complex and there's a fair chance any of us are wrong. And even though I'm a free market, small government fellow, I reckon it's OK that sometimes we pay taxes for things we don't use just because it strengthens the country. Yah, I suppose we could expect rural folks to pay 100 times as much for phone service or electricity or to do without. There just aren't enough customers in rural areas to make it profitable to build out that infrastructure. But I really don't mind da universal service taxes. I want all my fellow Americans to have access to modern services."

 

You're right that projects like this are a good thing, however SeattlePioneer raises a good point in his reply.

 

The people will decide whether or not such projects are necessary by voting with their own pocketbooks. This is why special projects should be paid for through bonds instead of just raising taxes or borrowing from a central bank. You're more than welcome to be an advocate for everyone to have access to modern services, but I still drive out on rural dirt roads. People out there don't get high speed internet, and probably won't for quite some time until the private sector can make it cost efficient. What has been made cost efficient is satellite, which is fast enough to make dial-up a thing of the past and cost effective enough for many rural folks to get.

 

I'm sure if it came up to vote for a sales tax increase or bonds being sold for a project to bring them high-speed internet it would get shot down because nobody really has a value on those things out there. They don't even put a high enough value on paving their roads yet!

 

The private sector really isn't as maniacal and diabolical as the left would have you believe. All in all, they're just people who want to serve other people and sustain their own life in the process.

 

Even when folks get rich, they end up doing nice and charitable things. My example is that there just aren't Rockafellers and Carnegies anymore, and it's because government feels it's their job now to save all of us and bring all of us to the future together. Truth is, many folks are just as well and content sitting on the porch of their old farm home on a dirt road with their dog and having lemonade with their neighbor. Simple living people aren't really concerned with anything other than the government just letting them live their life.

[SeattlePioneer]

>

 

 

 

In this society people have no obligation to pay any more taxes than they are required to pay. Paying taxes isn't "dues." It's a legal duty that may be fair, or may be unfair.

 

 

But taxes are money or property taken by force or the threat of force. If it weren't legalized, it WOULD be robbery!

 

Keep in mind that the money taken can be used for bad and evil purposes. Most people can point to government spending they object to, and other spending they approve.

 

I don't agree that taxes are a moral good. They are a fact of life and a necessity that people pay because they must.

 

Taxes inescapably remind me of a guy being held at gunpoint while his wallet is taken. In the case of taxes that is legal to do and necessary to some extent, but I simply don't see it as a virtue either for those holding the gun or the person who has his wallet taken.

 

Sorry.

[Beavah]

Nope, SeattlePioneer. Payin' for societal services is a moral and civic duty.

 

Yep, I've no doubt that there are folks out there who feel that only other people should pay, and would happily freeload if given da opportunity. They'd use the roads but not pay for 'em, benefit from an educated populace in their workplace or community but not pay for education, have lower insurance costs because of fire and police protection and not pay for it. And of course send other people's kids off to fight a couple of wars to protect 'em but not pay for those either.

 

So yah, while taxes are a moral and civic duty, an obligation of citizenship that requires every good citizen to pay for the common expenses of society, we do have to respond to those who are selfish and would take advantage of the group for their own benefit. That's why we have laws against theft and fraud, and enforce them with guns and prison. And that's why we have laws against tax evasion, and enforce them with guns and prison. Because while most citizens understand and recognize that paying taxes honestly and fully is a civic obligation, there are some folks who try to steal, or would steal if there weren't an enforcement mechanism. Maybe that's you. It isn't me.

 

Of course if everyone were in Boy Scoutin' and were taught their rights and responsibilities as a citizen and kept to their Oath, then yeh wouldn't need tax evasion laws. Or many others, for that matter.

 

Beavah

 

[Beavah]

This is why special projects should be paid for through bonds instead of just raising taxes

 

Yah, hmmm....

 

Yeh do understand what a bond is, eh?

 

It's a debt obligation that's paid for by raising taxes.

 

Yeh need to build a school, but everybody in da neighborhood can't fork over $10K each to pay for a school in cash.

 

So yeh authorize the school district to pay an investment bank help it issue bonds, which in turn are mostly purchased by banks or insurers or pension funds who might in turn be borrowin' from the Central Bank. The bond means that you agree to a tax increase which will pay the amount borrowed back, with interest, over the course of some period of time.

 

So when yeh authorize a bond, you are both increasing taxes and in all likelihood borrowin' from the Central Bank. In fact, that's how the Central Bank helps the economy, eh? By making funds available to borrow that wouldn't otherwise be available, so that builders can be employed building your school, so that teachers can be employed to staff it, so that kids can be educated, so that the economy will expand.

 

Beavah

 

[BS-87]

Beavah - The problem you fail to point out is that the Central Bank should not be purchasing the bonds.

 

When people and businesses and banks in the community buy bonds, they are putting money up front for the project which will be paid back to them in taxes. This prevents the community from having to save up money for an immediate need and instead commit to pay back over time the bond to its purchasers.

 

It's not a commitment to raise taxes, it's a commitment to mandatory spending to pay off the loan to creditors when the government doesn't have the lump sum available.

 

It's when these bonds are sold to foreign holders, including foreign governments, and to central banks that we have a problem. Certainly some foreign investors have an interest in our infrastructure, and so I'm more apt to allow foreign investment than a central bank.

 

When a central bank is purchasing, they're purchasing with debt (or money which doesn't really exist and is in risk of default). When these loans default (like in the housing crisis) the money which never existed cannot be recouped. This means there's a certain amount of our national debt which was never really acquired wealth and so our bailing out that defaulted wealth essentially DOUBLED DOWN on that debt. The problem is that the Central Bank borrowed the money to the govt for those bailouts, meaning that the wealth used to bail out the debt that came from wealth that didn't exist doesn't exist either!

 

It comes down to the money multiplier effect. In theory it allows a small reserve of real wealth make large sums of borrowed wealth possible. It's a disgusting abuse of fiat currency that will only continue giving us bubbles and bursts and every single time more wealth is transferred to the government in these bursts.

 

I know I start sounding like a broken record, but if we can't tie wealth to something like gold (because it'd stagnate our economy or cause inflation) what can we tie it to that grows at the same rate as our economy? Because right now, the US dollar is devaluing everybody's wealth.

 

 

Edited to add: Didn't realize this thread was going to turn into "Economics and Citizenship with Beavah and BS-87"(This message has been edited by BS-87)

[Beavah]

Nah, that's all a muddle again, BS-87.

 

Yah, you're right, I was simplifyin' a bit. There are government bonds that can just be issued by government bodies (city councils, university boards, etc.) in anticipation of future revenues. But you were talkin' about people voting on special projects, eh? Somethin' like building a new school. And in those cases, the people are both authorizing the debt and increasing property tax to service that debt. So da tax increase comes with the bond authorization.

 

Now let's say a bank can borrow money from da Fed at 1%, and they can buy your school-building bond which returns 4%. So they can borrow money from the Fed and use it to buy your bonds, even though they otherwise wouldn't have the reserves. When yeh pay off your bonds, you pay 4%, the bank gets 3%, and the Fed gets 1%. The Fed printed money to make the loan, but in the end they took back in (and destroyed) more money than they printed.

 

When a Central Bank is purchasing, it's not purchasing with debt. It's either purchasing with dollars (created out of thin air), or with its reserves (gold, foreign currencies, etc. that it has). You're mixing it up with the government. When the government is purchasing, it might be purchasing by issuing debt (U.S. Treasury bonds). With quantitative easing, the Federal Reserve is buying Treasury Bonds with dollars (created out of thin air), that the government must repay with interest (which will make more dollars than were created disappear). The Fed holds those Treasury Bonds in its reserves, and can sell them to investors to diversify its reserves.

 

None of that has anything directly to do with mortgage or bank bailouts. It's a wild and crazy mechanism for keeping interest rates low and introducing more money to the system so as to prevent deflation/depression. If instead the central bank were limited by a gold standard, then what would happen in a panic like this is that people would demand gold for their dollars, wiping out the central bank reserve, and the central bank would not be able to control interest rates. So in a high risk environment like 2008-09, interest rates would skyrocket, lending would cease, and you'd have Great Depression II.

 

So da absence of a gold standard saved us from economic catastrophe.

 

I'm not sure what your objection is to selling bonds to foreign banks or individuals. That's routine stuff. It provides foreign banks with dollar-denominated reserves which allow them to loan money to their citizens which in turn allows their citizens to buy American-made products. Why do yeh object to that?

 

And of course debt is leverage or a "money multiplier effect". That's how all modern economics works. If yeh want to buy a house, you take out a mortgage. For a small down-payment yeh suddenly get control of a large amount of cash which allows you to buy the house. That cash in turn goes to boost the economy by paying a realtor and the builder and his employees, which causes them to employ more people, which grows the economy, which helps you earn what you need to pay off your mortgage.

 

Now, in the end, da value of any asset is only what people will exchange for it. Doesn't matter whether it's gold or dollars or barrels of oil. If yeh increase the supply of dollars faster than the growth of the dollar-denominated economy then yeh would expect some devaluation/inflation. But only if it's in circulation, eh? Not if it's in da mattress (or a bank reserve). If yeh stuff it in a safe, its value increases because there's less supply in circulation. That's why da employment figure matters.

 

No different for gold, eh? Da value of gold has crashed in da past, as has the value of oil. Right now the value of gold is hyperinflating because people are hording it. Certainly the fiat-currency dollar has fluctuated, but nowhere near as much as gold. So based on da objective data, tying a currency to a less stable commodity like gold doesn't make much sense at all.

 

Yep, it's all a house of cards when yeh get right down to it. Da modern world uses a token, a chit, to represent value in order to make commerce work. The token is really just a piece of paper. It's a crazy system in a way, but it sure beats the heck out of bartering chickens for medicine and labor for electricity.

 

Beavah