Politicians are continuing to promise trillions of dollars in free education, housing subsidies, universal health care and other programs. Recently, BET founder Robert Johnson called for $14 trillion in reparations alone. Kamala Harris has a $10 trillion climate plan. On the Republican side, President Trump has shown little restraint in spending throughout his term while cutting revenue (and borrowing at a record rate). It is not surprising therefore that, last month, the United States passed the long-discussed red line for economists. Our debt is now greater than than our gross domestic product. In June, we passed $25.5 trillion in debt and this figure may be overly conservative. It is now roughly $27 trillion. Yet, neither party seems a bit concerned as this political ship of fools floats toward a collision with economic reality.
The federal debt has ballooned with pandemic spending but Congress and the White House was already spending with abandon before anyone even heard of Covit-19 or the Wuhan wet market.
Just consider this simple fact. In December 2019, we were $17 trillion in debt (an alarming figure discussed on this blog as 80 percent of the gross domestic product. The fear of government analysts was that debt would approach 100 percent of GDP by around 2030. We reached that point at the end of June with $25.53 trillion, or 106 percent of GDP.
Yet, politicians are still throwing around trillions of dollars like they are bargaining chips like Speaker Nancy Pelosi recently expressing frustration that the White House does not simply reach an agreement with it going up a trillion and the House going down a trillion on the next stimulus package.
We have a new mindset that makes Sen. Everett Dirksen look positively frugal when he famously said “A billion here, a billion there, pretty soon it begins to add up to real money.” Now it is a trillion here, a trillion there and it still does not seem like real money.
It is certainly true that large economies like the United States can hold huge debt without spooking investors and triggering a rise in interest rates on debt. We have passed the 90 percent mark a few times in history as with World War II. However, there is every reason to be concerned. World War II also was followed by an expanded industrial base and booming economy. That does not seem in the works to the same extent. In addition, we will be looking at increased annual deficit funding to meet these commitments without substantial increases in taxes, which do have an impact on investment and employment rates. Debt and deficits are often confused but the ledger is not good in either category.
No one is suggesting clarity on how such trends play out but it would be comforting if there was some indication that either party was taking this ballooning debt seriously.
I might be interested if the entire formula had been used but as is bupkiss may be a miss spelling using the p. However when I see
GDP minus (COP + COG) = NDP and half the government is on vacation with their work left undone I can see why the working class of government got the bump. Never mind asking Piglosillyni or the rest of the AWOLs math is not their strong suit.
Try National Debt minus cancellation recall of Piglosis two trillion plus one trillion more from the first go round means the working class of Government refused to be blackmailed and strong armed and just went a long with it to see if the left really thought they could get away with their fluffact nonesene part II.
Step one vote for the three. Step two change the majorities to Citizens choice and more Citizens choice. Step Three repeal everything the socialist regressive andti Constitutionalist did.
Why is it so hard for Turley to blame Trump for anything? He is the President. He told us tax cuts for the rich would pay for themselves. He has never proposed or stuck by a reasonable plan to cut anything. He is proud whenever he increases military spending.
In the latter years of Obama, the deficit was going down. Under Trump, it has skyrocketed; particularly when Republicans controlled Congress. Then the pandemic hit. There is no plan for cutting the deficit under Trump. He just wants more money to do things like build the wall.
How hard is it to blame Trump? His colossal failures of leadership are there for all to see.
One thing about Trump that cannot be seriously disputed: he is fiscally irresponsible. He knows how to spend, but that’s all. His father supported him well into his forties. His father kept the Trump Companies going by shifty maneuvers to move around money and evade income taxes, including the Trump Foundation, which is nothing more than a slush fund, plus other tax-evasion schemes, like a fake building supplies company. Even when little Donnie went out on his own and started casinos, which immediately began failing, Pa Trump sent emissaries to purchase millions of dollars worth of chips that were never going to be cashed in, which in reality is either a loan (that they didn’t want to show up on the books, so Donnie could appear successful and keep borrowing), or a gift, which would have been subject to the gift tax. He cheated contractors: getting them to agree to provide goods or services at an agreed upon price and then refusing to pay, forcing a lawsuit which would force a settlement to avoid expensive attorney fees. Trump has been sued thousands of times. Trump praises himself for this maneuver, which he believes shows how smart and savvy he is: he gets goods and services at a lower price. Then, there are the multiple business bankruptcies.
I agree that Turley tries very hard to spread the blame around, but the scales are not equal. As to stimulus money, economists agree that it is money well spent as it avoids foreclosures, bankruptcies and evictions.
here is Natacha to contribute the usual non-sequitur, irrelevant insults about Trump to any conversation.
Here is Kurtz saying nothing.
In contrast, Natasha’s has content one can challenge or not. Kurtz seems to have the same problem with women as Trump does.
hey,. If Trump has trouble with women, give me that kind of trouble. that’s the kind of trouble only the top can afford.
my level of trouble has been pretty great however, i am lucky’
my issue with Natacha is her obnoxious and irrelevant harridan drivel, not her looks, nor her sex. I have no clue what her looks are like. I take her at her word she is female, of course you realize book that in this day and age people think biological sex is just an illusion and they can “pick their own pronouns”
again, the problem with this obnoxious and irrelevant troll, is that she is obnoxious and irrelevant.
How very like a Democrat pundit to drag sex in where it has no relevance.
But I am sure you are feeling flush from a week of binging on the DNC informercial
I only tuned in for Pete and then Joe. Seems like nobody is talking about that, if you have relevant and timely observations, feel free to share them
that would be more welcome commentary than another boring copy and paste set of insults about the one that Bug more amusingly calls “floptop” aka orange man bad
We’ve seen Natacha’s content. Over and over. For about five years now. Everyone’s answered her point by point at some time or another.
Let’s rephrase that. You’ve avoided and deflected her points continuously and resorted to insults because you have no answer for her.
She cannot even offer concise insults. Imagine encountering her in meatspace.
I suspect she’d shatter your infantile ideological constructs to your face and leave you staring at the floor in shame. Thanks for the image though, it totally brightened up my afternoon.
Nat: Your abstract generalizations are nonsense. I could lay out a litany list of the accomplishments DT has accomplished as POTUS, , but your radical tunnel visioned channel locked brain would finalize the frozen kool-aid process.
“Accomplishments” of DT? What on earth could counterbalance the truth: 1. the US unemployment rate is the highest it has been since the Great Depression. About a million new people each week lose their jobs. 2. At least one thousand Americans die every single day from the coronavirus that Trump said would magically disappear in April. I won’t go through the laundry list of statements downplaying the seriousness of the virus, the lies about availability of testing, or the lack of any cogent national policy to address the virus, the irresponsible demands to open schools and businesses even though the virus is not controlled, so infections are spiking, or how Trump has promoted unsafe and ineffective treatments (the latest is oleander, which is highly toxic [there’s even a murder mystery movie called “White Oleander”, starring Michelle Pfeiffer]); 3. The overt racism: Mexicans are “animals, murderers, rapists and criminals”. He cages young children and separates them from their parents as a deterrent to others who might want to migrate to the U.S. Jeff Sessions admitted this was the reason; praise of White Supremacists at Charlottesville, insulting the Kizer Khan family, a Gold Star family; 4. then, there is the endless list of broken promises and lies: “Mexico will pay to build the wall”, “I created the most-successful economy in the history of the world” (total lie), “No one else but me can do ______(fill in the blank)”; “I’ll have a better health care plan than Obama (well, it’s been 3 1/2 years now and not only is there no health care plan, Trump is in court trying to do away with Obama care. which would throw millions of Americans off of health insurance when they need it most, due to unemployment and coronavirus cases continuing to go up; 5 How about the fact that he’s the laughingstock of other countries; 6. pulling the US out of the Paris climate accord and treaties, leaving the US less safe 7. How about the deference to that murdering former KGB officer, Putin, including removing troops from Germany, which makes all of Europe more vulnerable to Putin; 8. How about getting impeached by the House of Representatives and 38 US Senators voting to remove him from office because he tried to leverage aid to Ukraine in exchange for them ginning up lies about Joe Biden?
This is just for starters.
Correction: 48 US Senators voted to remove him from office.
Word!! And good call back to White Oleander.
The real danger is that an anonymous cryptocurrency like Bitcoin will supplant the US$. That would negate 40 years of law-enforcement evolution that deter financial crime through bad-actor traceability through the banking system. Few appreciate the connection between the US banking system and anti-corruption. When tens of millions of Americans are being extorted by foreign cartels anonymously, they will, but it will be too late. You never give organized crime the upper hand — the cost of taking it back are just too large to fathom.
U S Constitution Article I Sec 8: Congress shall have the power “To coin money, regulate the Value Theron,and of foreign coin”. If you believe the Fed Gov’t is going to give up that power, I would believe you are delusional. All the other fiat monies would therefore be considered ponzi schemes. Even Liberal Maxine Waters has thrown down the gauntlet on the fictitious pseudo coins, that it will not be tolerated.
The US Federal Gov’t, many states ans cities are undeclared Bankrupt. But the US has a superficial facade of seemingly to be in position to be a somewhat safe harbor. The other fictitious crypto (pseudo-currency) is truly a cosmic particle just swinging in the wind, and Nothing to backs those.
The Federal Gov’t could not even pay the difference in an increase in interest rates. That is another reason the interest rates are retained so low.
The Federal, State, Cities and many individual retirement plans, are very under funded and that is a part of the coming implosion. Wasn’t it NJ this past year, owed their State Retirement Plan about $1.5 Billion and paid into the fund about $700,000? Implosion is pending, the old can is now in the cul-de-sac, and can no longer be kicked down the road.
People, the retained earnings of corporations generally account for about 11% of gross domestic product. There isn’t some untapped cash cow there.
You can tax people in their capacity as income recipients, in their capacity as producers and consumers, in their capacity as property holders. Each way has implications for pareto efficiency and distribution.
There’s no grand reason to run a deficit most of the time. You can use fiscal and monetary policy to modify the tempo of the business cycle. It’s not going to be effective at much more than that because ultimately how much you produce depends on technological innovation, maintenance and extension of human capital, and avoidance of deadweight loss from processes. Avoiding deadweight loss from regime uncertainty suggests predictable, rules-based fiscal and monetary policies and mindfulness in crafting and maintaining regulatory regimes. In truth, the net increase in the nominal public sector debt between 1953 and 2008 should have been close to nil. General mobilizations and banking crises should be occasions for l/t public sector borrowing. Betwixt and between, you should balance your budget over the course of the business cycle and take on long term debt only for capital projects (which are going to be the work of state and local government for the most part).
We’re in very peculiar circumstances right now so borrowing is appropriate, as it was in 2008-09. Just wish our balance sheet had been in better shape before we elected to do it. Our political class is always somewhere in the gray area between comical and vile.
The corporate income tax rate is 35%. in the U.S. This does not include their assessed portion of the payroll tax. While it is easy to demonize corporations and generalize about the evils of their not paying their fair share, it is not accurate to tar all with such a broad brush. A more accurate argument would be aimed a the tax loopholes that allow the conglomerates to shield income. Not all corporations enjoy the benefits that the lobbyists provide to the likes of the Forbes 500. Unlike the Federal government many try to be fiscally responsible and pay their taxes accordingly.
21% Cindy.
Jonathan Turley does not understand economics.
Neither do you, Sundown David.
Absurd, you poor little bitter moron. Even Allan has more integrity than you.
End our military and the expense now.
Another “what have you got to lose” promise from Trumpy bear. He’d blown up deficits pre covid with his tax breaks for the upper brackets.
Suggest eliminating said tax breaks for the top end, middle class stimulus to put money back in the economy, and moving forward to the shift into sustainable energy. Not even a question this is the path forward.
Dick Cheney was famously quoted as saying deficits don’t matter. As with many things Cheney, he was wrong about that. But the repub shift into supposedly GAF about fiscal responsibility only when dems hold the oval office is ridiculous. Let’s hope november holds the loss of McConnell’s seat as well sir floptop.
By the way, Jon. Like the tone of the post! It signals you coming to grip with a Trump loss in November and shifting your talking points into attack of the winning dems territory. Good to see the Koch and ALEC money shifting its focus!
The hatred for DT is so exceptional, that most of the Libs are willing to see America taken down through Socialism, any thing to remove him. Will have to sleep in the bed you prepared.
Yeak, go Socialists. That resolves, solves all issues doesn’t it. Green funds, Climate warming, free medical, free educations, free housing, et al, and defund the Police, defund the Military, that is some really winning items, isn’t it. Biden, Schumer, Pelosi been there 40 + years each, and that is why we (US) is now into dire straits. They whine and clown, and contend they are for the little guy. They don’t give a rat’s rearend about the little guy.
The only thing they want is power, and this time if they win, it is they be the Potentates. If DT had not won, the small lifting of the door to their Coup corruption (FBI, CIA, DOJ, AGs,et al) would not have been disclosed as little as has been. As Strozk said; “We have an insurance policy”. Yep, said policy expired. If Biden wins, he will be removed via the 25th Amendment very shortly after being sworn in.
Oh look at all those little nightmare creatures jumping around your head. It’s like the guy who loads the teleprompter at fox is spraying graffiti on your brain.
“The hatred for DT is so exceptional”
Hear hear!
Well deserved!!
Republicans, wake up and take an object lesson. HATE is a valuable social organizing force.
Nobody is better at HATE than Democrats. Because, they are very skilled at social and political organizing. Any fool knows “hate” is a tool in the box that has many uses.,.
Now I am not mocking them. I am scolding Republicans. You need to learn to let the fear and hate roll down like waters from the mountaintop, and the righteous justice will come as an ever-flowing stream.
FEAR the harm that they intend to do to you. Pete Buttigig said: “witness the changes from 2010 to 2020– imagine what we will do by 2030!” YES IMAGINE INDEED THE NIGHTMARE IF PETE BUTTIGIG FOLLOWS ON THE HEELS OF A BIDEN-KAMALA WIN.
TOTAL MISERY BY 2030 AND OPEN WARFARE ON US THAT WILL MAKE THE BLM INSURRECTION LOOK LIKE PATTYCAKE!
another 20-30 millions “new Americans” imported from South of the border!
CCP the biggest and most technologically advanced society on Earth, and US in hock to them forever!
these are some of my “imaginations” that leaped to mind when I heard Pete’s speech
So YES, HATE the bigs who have set these tools and pawns and mercenaries into action. Don’t hate your common fellow Americans who are all down here on the bottom with us, mislead as they are by poor education and bad upbringing. NO — RESERVE THE HATE FOR THOSE WHO DESERVE IT AT THE TOP
“GEORGE SOROS
Party: Democrat
Presidential Candidate: Soros told the NY Times in October that he will support the eventual Democratic nominee.
Total donations: $6,304,000
Soft money donations: $6,285,000
Hard money donations: $19,000
Net worth: $8.3 billion
Soros built his fortune leading Quantum Fund, once the world’s largest hedge fund. …
Soros donated over $20 million to Democrats in 2018, Business Insider previously reported. The former financier’s donations in 2019 have been to numerous Democratic groups, including the North Dakota, Michigan, Iowa, North Dakota, Hawaii, and Oklahoma Democratic Parties, FEC data shows”
— SOURCE BUSINESS INSIDER NOVEMBER 2019
UPDATE: TOP INDIVIDUAL DONORS TO DEMOCRATS FIRST HALF 2020 GEO SOROS AND TOM STEYER
———————
So. Yes, Feel the hate indeed.
let your fear and righteous anger guide you and activate you, and do not fail to vote for the one the richest men on Earth hate– DONALD TRUMP!
together, our hate may save our skins, if we act soon enough! and dont worry bug and book, it may just save your skins, too.
the solution to all social problems is government spending. i think that’s in the oath taken by congress.
If you watched speeches at the DNC or the hearing today with the Postmaster General, our politicians are living in a fantasy world of their own creation. They just talk about the giant Utopia they already have created, or are going to magically bring about. They have their fantasy and no truths will get in the way. I just watched several Senators huff and puff and blow the Post Office down and when the Postmaster General tells them that their angry tirade is a fantasy of their own creation and no basis in reality, they just continue their tirade as if the refuted partisan tirade has not been refuted. It is the ost bizarre thing I have seen in my lifetime. I get why Baghdad Bob did what he did but the fantasy the left is selling is so bizarrely fantastic that it defies explanation and I worry about the people because they are stupid enough to buy the fantasy world.
Cady: the only ones living in a fantasy world are you Fox News disciples. Trump admitted that he was withholding funds from the USPS to try to stop voting by mail. Never forget that he blew handling of the pandemic, which makes it risky to vote in person. He claims, despite a mountain of contrary evidence, that voting by mail would lead to widespread fraud, even though he and Mikey Pence vote by mail and states, like Utah, for example, have had voting by mail for years with no major problems or fraud. The only one engaging in election fraud is Trump. The real reason he’s trying to stop voting by mail is that more Democrats than Republicans would like to vote by mail, so he’s trying, once again, to defeat the will of the American people to hold onto power he cheated to get in the first place. He appointed a mega-donor with no post office experience, and who has companies that either compete and/or contract with the USPS (which is an absolute conflict of interest) as Postmaster General. He immediately took steps to slow down mail processing, such as removing mail collection boxes, eliminating overtime (even though the USPS has had a hiring freeze for years and relies on overtime to get the mail processed and delivered), and scrapping automated mail sorting equipment in larger postal hubs that can handle 35,000 pieces of mail per hour. THESE ARE FACTS. DeJoy has no doubt been coached on how to lie or spin his way past these facts, but the evidence is overwhelming. I’ve seen proof in my own community.
Again there is no “left”, a moniker Fox News tries to use to describe those opposed to Trump, which is most Americans, including a growing number of former Republicans. Ever heard of the Lincoln Project?
You are so full of it, Natacha, your eyes are brown.
let me pick from this verbal dungheap left steaming from Natch, something to consider
“there is no “left””
in some sense this is true. The old Marxist/ pro Labor Left, around 1968 became obsolete in favor of fhe newer left, which was all about destroying natural human social attributes like race, ethnicity, religion, sex, the family, etc., all as vague forms of social oppression. See at that point they stopped caring about the workers, in favor of courting radical students and lumpenproletariat agitators (blm is this generation’s lumpen flag bearer) ….. and that much more important business of absorbing themselves into bureaucracies.
So as they took over universities and government employment blocks and even corporate bureaucracies, it was natural of them to stop worrying about low pay, because at that point, between all the affirmative action type quotes, government patronage opportunities, and various forms of welfare, the poverty problem was no longer all that bad. The “Left” needed a new bogeyman once it came clear that as an economic system, communism provided no operating alternative.
And also they then became beholden to global financial elites, who much prefered them to focus on “Racism” and sexism and all that jive, instead of the concrete matters that real labor organizations care about. So all the “equality” schtick kept them busy with work that did not threaten the George Soros types out there.
And, in Bill Clinton’s time, the supposed left wing Democrats, became “free traders” with NAFTA, and with the bombing of Serbia, marked their new belligerence courting the “military intelligence complex” too
From Bill clinton, through Bush, to Obama, not much changed except for odious domestic mutations such as “gay marriage”
And then, the orange swam, Trump. The unexepected winner who changed the Republican and National policy from free trade to fair trade. And tried to cut the immigration water off too. This attacked 2 key goals of globalization: more free trade, and more migration. Both which serve the interests of the richest men on Earth, like Geo Soros or Mikey Bloomberg or Jeff bezos. These ultra rich centibillionaires, activated their agents inside all the agencies to try and unseat him with the Russia narrrative. and that having failed, called on the shock troops of BLM to activate the insurrection.
The beneficiary of the insurrection, they hope, will be the Democrat candidate. Whose true purpose will not be to “reform health care” or any other fiddlesticks. But it VERY MUCH WILL BE to bring back the FREE TRADE ie opportunity to use Chinese slave labor, and the IMMIGRATION ie, importation of millions more of new low wage workers from central america to keep wages low in America. Oh how these two polices alone will pay back all their tens, hundreds of millions in donations to the Dem outfits in spades!
So yes: there is no left. There is a fake left, which is really just a pawn of global financial interests. Right now TRUMP is farther left than BIDEN if by Left you mean, politicians who elevate the worker’s interests over those of finance.
Plus, he is not a war powers stooge. Boy when this guy tried to pull troops out of Syria and Afghan, it was a bipartisan group of Republicans and DEMOCRATS who could not act fast enough on behalf of their Pentagon buddies to stop that one! Wow. So much for “Commander In Chief.” And I hear Esper thinks he’s allowed to mutiny so Trump’s got that to think about. Well, that may be sauce for the gander one day too.
PS oh let’s not forget Tulsi Gabbard although we notice the DNC did. Yes, this is what happens when a Democrat speaks out against war plans. She gets the boot! So yes Natch “there is no left”. There is only PRO GLOBALIST DNC PARTY….. and the PRO AMERICAN PARTY of TRUMP
Convene an international body, cancel the Debt. Creditors should never be allowed to destroy society. You see: easy. But we have to talk about it first, and not assume the supremacy of money.
Let’s be real. The percentage of the population that ever cared about the deficit and debt is very small- they’re called Austrians(or “austerians” by the Keynesians). If you think there are no consequences then you are a fool, but you have lots of company.
Ivan, what are the consequences for the Japanese?
None of the following is news…
We are all caught in a debt trap. Each crisis requires a greater and greater response from the governments and their central banks in order to keep the credit economy from imploding. The consequences of this are many, but the end result is reduced productivity growth which is the lifeblood of all economies, and greater wealth inequality as those with first dibs on the liquidity splurge gain economic advantage on everyone else. Companies that should go bankrupt don’t. This leads to stagnation as economic resources are misallocated. Capitalism without bankruptcy is like Christianity without hell…someone said this.
This can all be summed up as the “socialization of credit,” but it’ important to note that the initial phase of credit socialization was aimed at giant corporations…otherwise known as “corporate welfare.”
A consequence of all this is a global economy that can not withstand an average recession without having to resort to emergency measures to stop asset prices from falling and the liquidation of debt. It’s a credit doom loop that requires ever more amounts of credit and money printing to keep going.
The known consequences are bad enough, but it’s the unknown that we should really fear. In my view, it’s that “unknown” that triggers WW3.
Chauncey Gardner(Peter Sellers) in “Being There” explains economics and politics: our economy is like the seasons. The problem is that we are attempting to outlaw winter. Mother Nature will have her revenge.
Ivan,
i never saw this movie but its on my list now. Martin Heidegger’s term “dasein” translates roughly to “being there,” or in some contexts, existence
I see the movie start with a nod to Kubrick’S 2001, with the score playing Thus Spake Zarathustra. And yet, instead of monkeys before the monolith,
you have african american “urban youths” loitering in the streets of the Capitol. So Ivan., ha ha, this coded message is so very RACISSSSSS
this video makes the analogy without my added “color” which I submit in honor of the riot squads of BLM
I thought “Being There” sucked
Um, thanks. I’ll take that under consideration if I ever get the time to see it.
It’s comedy so it fries his circuits.
It’s not funny at all. It’s a dead bore and pointless as satire, in my opinion. You want something funny and old school, watch “Pee Wee’s BIg Adventure” or The Jerk”.
I prefer Harold and Maude in the Ashby portfolio myself.
Different strokes I guess. I didn’t like that one either. Recently saw Nickelodeon from that era by Paper Moon director Bogdonavich – liked both. Annie Hall was funny.
Love both Nicolodean and Annie Hall. Classics.
My bad: Nickelodean**
I did see the Jerk and I love it. But you two guys are older than me and obviously more sophisticated too. My idea of a comedy when I was younger was “Stripes” or “Caddyshack” or “Fast Times at Ridgemont High”
Pre-“more cowbells” Christopher Walken in AH was great – one of many great scenes. Nickelodeon had beautiful timing sight gags.
**FAST TIMES AT RIDGEMONT HIGH**
Awesome flick.
Sean Penn hosting a virtual table read for the script sometime soon.
Today is the 20th anniversary of the original “Bring It On”
Kurtz, I never saw Caddyshack – maybe too old, though I’ve seen plenty before and since. Best Bill Murray film – and I expect, no demand, no argument on this – is Groundhog Day. Painstakingly making the moves on Andie McDowell is great – from “French poetry! What a waste of time” to:
https://youtu.be/5OEIYdcUu18
That was the sentiment back when it came out…I was too young to understand. I was more of a fan of the Pink Panther movies…Cato!
Great movie, Kurtz.
OK, that’s it bug. We’re not friends anymore.
Ha! I agree the pacing was odd in Being There. It’s more one I liked through looking back on it — and the cinematography was amazing. Ashby got his start as an editor before directing. It shows in every one of his films.
Maybe i should re-watch it. It’s been 100 years.
We have a disaster is Iowa that will take a bit of money to clear up. I saw a Tik Tok video for a young lady who is caught in it. Huge. Make NOLA look like a toy store, except for the dead bodies.
There are fires in CA, AZ and CO that are out of control. And the economy has been shut down. So, do you print money to help, or let everyone die?
“So, do you print money to help, or let everyone die?”
Governments should never let everyone die…that seems counterproductive. They could borrow money if they haven’t saved up for a rainy day to do what needs to be done to stop everyone from dying. They don’t have to print it. If the fires are beyond the control of the state, then they should declare an emergency and ask for help from the Federal government which can also borrow money. They don’t have to print it.
The answer for the shut economy is to open it and only start imposing restrictions if hospital resources are reaching their limit. The closing of the economy is a self inflicted wound. We had two choices: one bad, the other catastrophic. Our governments chose the latter.
Ivan, as studies have shown, the economy has shutdown primarily due to fear, not government edict. The 3rd and smart way was to respond with controls and resources – masks and distancing, testing and contact tracing – which would allow people to continue their lives with confidence. The only way this could have been achieved would have been with competent leadership from the president. No one else has the power to provide a clear and steady message on how we should behave, to marshal resources to produce needed supplies and technologies, and a controlled distribution system with those resources going to areas of most need, not the highest bidder.
This ain’t rocket science and there is no mystery why we have gone from a world leader in these types of crises, to a pitiable example of how not to do it that is also trying to sabotage international efforts. We can’t get rid of this guy fast enough.
The shutdown of business and travel by governments is what is causing the catastrophe. We have lived through pandemics before without governments forcibly shutting down business. As a society we hardly blinked an eye. No masks, no travel bans, no shutdown at all.
That’s false Ivan.
“The collapse of economic activity in 2020 from COVID-19 has been immense. An important question is how much of that resulted from government restrictions on activity versus people voluntarily choosing to stay home to avoid infection. This paper examines the drivers of the collapse using cellular phone records data on customer visits to more than 2.25 million individual businesses across 110 different industries. Comparing consumer behavior within the same commuting zones but across boundaries with different policy regimes suggests that legal shutdown orders account for only a modest share of the decline of economic activity (and that having county-level policy data is significantly more accurate than state-level data). While overall consumer traffic fell by 60 percentage points, legal restrictions explain only 7 of that. Individual choices were far more important and seem tied to fears of infection. Traffic started dropping before the legal orders were in place; was highly tied to the number of COVID deaths in the county; and showed a clear shift by consumers away from larger/busier stores toward smaller/less busy ones in the same industry. States repealing their shutdown orders saw identically modest recoveries–symmetric going down and coming back. The shutdown orders did, however, have significantly reallocate consumer activity away from “nonessential” to “essential” businesses and from restaurants and bars toward groceries and other food sellers.”
https://www.nber.org/papers/w27432
These are the same people who created the economic debt monster that was the beginning of this thread. Thanks for bringing it round.
Don’t get your comment Ivan. The study shows that fear, not government orders, is what is mostly driving the economic problems.
“While overall consumer traffic fell by 60 percentage points, legal restrictions explain only 7 of that. Individual choices were far more important and seem tied to fears of infection. “
I agree. They should have set priorities and adapted in response to new data. The experience we’ve had has really made the public health establishment look like sh!theads.
It will go down in history as a time when the health establishment put emotions and politics over science and data. I’ve heard this said a number of times now by top epidemiologists…the last one was the prof from Yale?
We are all caught in a debt trap. Each crisis requires a greater and greater response from the governments and their central banks in order to keep the credit economy from imploding.
Congress could have balanced the budget after 2009, with Obama’s co-operation. They did so during far more inclement circumstances during the period running from 1945 to 1949. Congress and Obama chose not to do so.
Yeah, that austerity thingy worked so well in the UK.
.
The US and Germany led the rest of the world out of the Great Recession.
Funny how TIA thinks we should have balanced the budget when liquidity was none existent, revenues were tanking due to the crash, and the feds were among very few sources of economic activity. He doesn’t mind Trump blowing up the budget with the fat rich guys stimulus bill of 2017. That sugar high – during a period of already growing – lasted a year while the indigestion will last 10. By the way, deficits under Obamadeclined year after year after the crash, with a slight uptick in 2016. They’ve done nothing but go up since Trump took office and he had both houses of Congress for the 1st 2.
Again, the results studies of the multipliers associated with fiscal stimulus produce results which vary quite a bit but generally cluster around a value of 0.6. As a rule, output is just not that sensitive to fiscal stimulus one way or another. Monetary policy is the way to moderate the business cycle. “Austerity” in fiscal policy is not a coherent concept, btw.
Funny how TIA thinks we should have balanced the budget when liquidity was none existent,
If liquidity had been non existent, the government would not have been able to borrow.
Larry Summers and the rest of the establishment at the time were saying that we were suffering from a savings glut.
Doofus – people and other governments – Hellooo Peking! – will loan to the government when they won’t anyone else. Read a f..king book sometime you stupid fool.
“The US and Germany led the rest of the world out of the Great Recession.”
And where did they lead us to? How much extra debt was added to the system and how much growth did it buy us? The numbers are ugly. The actions of the US and Germany have made the problem worse. Entities that are too big to fail/jail have gotten much larger while debt has exploded. This story of continuously growing debt beyond the growth rate of the underlying real economy has been going on for many decades under both Democrats and Republicans. The price will be a prolonged zombie economy/stagflation or much, much worse.
“The US and Germany led the rest of the world out of the Great Recession.”
This is a nonsense statement.
Led as in 1st place. As in kicking ass and taking names (like Sleepy Joe last night), like seeing the UK (an austerity country) in the rear view mirror. Until the virus, they were still there – whoops, still are.
My response is below. The headline numbers offer no support for what you’re saying.
Ivan, they led us out of the recession and into what was the longest period of sustained US growth EVER!
Do you imagine wallowing in a longer recession would have been smarter? See what they’re doing in the UK, because that’s essentially what they did.
Dude, I’m in business. Sometimes you have to spend money to make it. Anything we spend now – including that $600 a month the GOP shot down – will be cheap compared to what will happen if we keep going down into the abyss and have to dig out.
Again, the growth rate in per capita product for the US was 1.29% per annum over the years running from 2009 to 2016. That for the UK was 1.20% per annum. Not an argument for spending like a drunken sailor.
WW2 ended the recession. Too bad it cost 50M lives.
World War II occurred more than 60 years earlier. If you’re talking about the Great Depression, no. Most occidental countries began to recover in 1932. The U.S. and some others began expanding in 1933. A few stragglers like Italy began growing again in 1934.
Economic collapses often lead to war. I’ve feared this for years. There are too many politicians on both sides that are quick to vote for sending troops to far off places for no good reason.
Economic collapses often lead to war.
They don’t. There was no ‘economic collapse’ in Europe or the Far East 1938-39, there was none in 1913-14, and economic historians studying that run of years have yet to find evidence of one in Britain, France, or other powers during the period running from 1789-92.
A zombie economy, in short.
That’s a nonsense concept.
No, they’re not called ‘Austrians’. Austrians are adherents to contentious conceptions in both macro and micro economics and are a tiny minority among economists. (Austrians tend to favor and updated version of the gold standard called a ‘currency board’. Sir Alan Walters, Margaret Thatcher’s principal economic policy guru referred to gold bugs as ‘crackers’).
Everyone concerned about the implications of stress in bond markets cares about this massive borrowing and about national balance sheets. We’ve more margins than others because our debt is denominated in our own currency. Still, doesn’t mean we have to use that margins.
if interests bump up, it sure will matter more than it does not. maybe it will be a while, or maybe not
I could predict futures like that, I wouldn’t have time to chat with you guys because I would be swimming off the deck of a yacht in the Aegean sea right now instead of sitting at a desk in flyover eating a footlong tuna from subway
Tuna is for cats to eat.
Women make things with tuna as part of their ongoing passive-aggressive war with their families and with youngsters in their charge.
Soak the rich.
Don’t just sprinkle.
😐
My comment about Japan won’t post.
Japan has a debt to GDP ratio of about 2.345 and manages just fine.
Japan is stuck in a rut. But its a complicated story. There is not a precise analogy between government debt and household debt. That is a propaganda piece that certain people have advanced over time which is comparing apples to organges. Debt matters far less for government, than households, and in America, while the reserve currency status of the dollar holds, it matters far far less. So the concerns about debt are muted along the spectrum.
However it still not good to have more. Although perversely the mountain of US debt has leveraged the reserve currency posture of the dollar. It’s complicated.
As to Japan— I will give you the very best work on the subject David if you really want to know how they got to where they are
https://www.youtube.com/watch?v=p5Ac7ap_MAY
“Princes of the Yen” a documentary based on the book by Richard Werner, one of the top economic consultants for Bank of Japan in the relevant time periods
this book is highly recommended books by the many very successful traders
Japan’s problem is a secular decay in the quantum of human capital due to their population aging. The way out of that is to procreate.
Absurd, that is definitely a very dire problem for Japan. It’s touched on in the film, and the enthusiasts of Werner’s work often remark the same.
Wonks have some plan, https://qz.com/1646740/japan-wants-to-raise-its-fertility-rate-with-new-perks/ …
what did mike tyson say about plans? everybody’s got one, until they’re punched in the face
an “herbivore man” if punched in the face, cries and runs home to his mommy. that’s the level of masculinity in Japan now
that’s what they call their low testosterone youths. we call them “soy boys”
Japan has a debt to GDP ratio of about 2.345 and seems to manage just fine.
They have all that debt because they bought into the idea that their problem could be addressed by fiscal stimulus. What they needed to do was clean up the balance sheets of their banks (it took them about 15 years to get around to it), loosen their monetary policy, and breed the next generation.
I think you might enjoy “Princes of the Yen” too. It’s worth it, give it a taste and you will see. dont be put off by the historical prologue, the meat comes after
JT, I agree with your concerns. I’ve felt uncomfortable for a long time. Whatever happened to the Tea Party, besides being kneecapped by the Obama administration IRS? There’s no fiscal sanity at all.
And the Fed is going way beyond the nasty stuff they did for the quantum easing/bank bailouts since 2008. The Fed should let the interest rates alone — this will greatly affect the debt (painful for us, similar to the Fed Volker times, but will help brake future spending). And Fed shouldn’t be buying corporate debt, especially junk bonds.
And the Fed is going way beyond the nasty stuff they did for the quantum easing/bank bailouts since 2008.
The Fed didn’t do any nasty stuff in 2008-12. The inadvisable things done were the auto industry rescue (which raped secured creditors in order to pay off Democratic constituencies), financing the deficits of Fannie Mae and Freddie Mac in lieu of a debt-for-equity swap, the porkulus, raising the minimum wage, Dodd-Frank, and Obamacare. The Fed was not the author of any of these policies. The rescue of AIG was an anxiety-provoking judgment call.
The auto bail out saved GM, but more importantly the auto industry – Ford and Chrysler applauded the move – including the various parts manufacturers throughout the area, and the upper mid west’s economy.
The auto bail out saved GM, but more importantly the auto industry – Ford and Chrysler applauded the move –
Totally not necessary. The auto industry required a restructuring of its liabilities and an allocation of costs among various stakeholders, something bankruptcy courts do routinely. The auto rescue was about paying off the UAW. Everything the Democratic Party does is about using government power to sluice benefits to its clientele and using government power to abuse and injure people not part of its clientele. It’s a gangster organization.
That’s false. There were no 3rd party buyers and loans were non-existent. UAW payments were a small part of the deal and they made conssessions. TIA lives in a pretend world of GOP talking points, and actually believes them. These were the guys preaching austerity, a tactic which sunk several European economies for years. Once they got into Trump’s presidency and the longest running growth economy since WWII – ever before he f..ked up the virus – they and he have no problem with deficits and stimulus spending when we don’t need it.
TIA lives in a pretend world of GOP talking points, and actually believes them.
Thanks for the projection. Been an education.
Again, what had to happen and would have happened in the ordinary course of affairs was that various stakeholders would have taken haircuts and the secured creditors would have been last in line for haircuts. This was unacceptable for Democratic Party clients.
TIA typically defines what would happen to the guys he and the GOP care about – investors. Meanwhile, the auto workers and diner dishwashers would take more than a haircut, but hey, the oxycontin makes it all alright.
Tom Steyer and Geo Soros and Mike Bloomberg call the tune for the Democrat fiddlers like Pelosi and Biden– not autoworkers. That is an illusion.
Now if we get into the specifics about the Dem candidates for POTUS it’s obvious you have the multinationals securely represented with Biden and Kamala
https://act.represent.us/sign/top-donors-leading-democratic-presidential-candidates/
organized labor favored who? Bernie. read the facts and don’t kid yourself, book
Organized labor favors BIden against Trump. Don’t kid yourself.
What they organize nowadays is government employees, especially school teachers.
Slightly more than 1/2 of union members are in private industry vs public, though membership rates of public employees is much higher than in private. Private union membership has declined with manufacturing declines and the success of mostly GOP politicians and their anti-union policies. This trend has contributed to the stagnation of wages, which have failed to track with increased productivity, and to the increased inequality in America.
Anyone who thinks Trump and the GOP are for workers needs to explain these facts, as well as their continued rewarding of the richest through the tax code, and continued attempts to limit safety net programs, failure to have any plan for universal health insurance and continued war on the ACA, as well as their on again, off again war on SS and Medicare. Trump recently renewed this attack by promising to lower or end payroll taxes.
PS GOP opposition to minimum wage increases – we are stuck at a figure from 11 years ago – is another example of their class warfare as the rate influences not just the very bottom, but all wages in the lower to low middle classes. It is estimated to directly affect over 1/4 of all workers wages.
PS GOP opposition to minimum wage increases – we are stuck at a figure from 11 years ago – is another example of their class warfare as the rate influences not just the very bottom, but all wages in the lower to low middle classes. It is estimated to directly affect over 1/4 of all workers wages.
Again, your talking point mill is lying to you. Minimum wage laws do one thing, which is to price some labor out of the market in return for a small increment to the benefit of those one ratchet up. When you have grossly excessive minimum wages (as you did for a time just prior to the 2d World War) it does noticeable injury to the labor market.
A “grossly excessive minimum wage” would no doubt create other problems, by definition. The impact of increasing the minimum wage on jobs is inconclusive, with numerous studies showing increases. The impact on wages is more predictable and as I noted would cause increases for about 1/4 of the workforce over time. Given the stagnation in wages, the decline – or murder – of unions, the failure of wages to increase with productivity, the cutting of safety net programs by GOP led governments, the war on universal health insurance by the GOP, and the growing inequality in the US, an increase in the federal minimum wage is way overdue. It was last raised in 2009 when Democrats controlled both houses of Congress and the presidency. If Trump is really a populist, as people like Kurtz continue to believe against all evidence, he should stand up and ask for an increase in the minimum wage.
The impact of increasing the minimum wage on jobs is inconclusive, with numerous studies showing increases.
Your talking point mill is still lying to you.
Pension funds and insurance companies buy bonds. So do older individual investors.
You know what professor…..when Trump and the Republicans decided that tax breaks for billionaires were a good idea they blew a hole in our national budget big enough for Putin to March right through. Those tax breaks and “incentives” have caused the mess about which you are now complaining. Republicans always talk about deficits after they’ve caused them and then go after the human centered programs that didn’t. It’s nothing new. It’s the same old pattern.
We need to close the billionaire loop holes and start making corporations pay their fair share.
Yeah, let’s make the corporations “pay their fair share.” Because when we do that, they jump overseas. Been there, done that. Corporations are no different than individuals when it comes to avoiding taxes (just look at all the New Yorkers moving to Florida). Think more creatively than that instead of repeating mistakes.
Greed will ultimately sink us.
You know what it’s time to stop the craziness about how wonderful corporations are. Corporations are happy to take money from the taxpayers. They suck up federal contracts and grants. They take bail outs and tax breaks and shovel money into their CEOs pockets and they furlough workers and buy back stock. It’s time to be serious about corporations. The founders expected corporations to contribute to the common good. They expected them to be controlled by the state not the other way around, Corporations that don’t pay taxes should be barred from receiving government contracts, bail outs and any other government benefits direct or indirect. Corporations who move production overseas should also be barred from any government contracts or support.
No more hand outs to corporate welfare queens. Enough is enough.
I don’t see any mention of state-controlled corporations in any founding documents. That doesn’t sound like capitalism at all. There are many products that require scale that a little mom-and-pop shop could never do. And who thinks corporations are wonderful?
+10
They expected them to be controlled by the state not the other way around, Corporations that don’t pay taxes should be barred from receiving government contracts, bail outs and any other government benefits direct or indirect.
Do you have a citation that states the framer’s expected that? As far as corporations not paying taxes, are you suggesting they should voluntarily pay more taxes than the tax code requires? I do taxes for a living. How long would I remain in business if I changed the name of my firm to Pay Your Fair Share tax preparation?
Here’s a novel idea; identify and eliminate federal government programs that should be done at the state level or by the private sector. I’ve done Activity-based Costing for federal agencies and the waste, fraud and abuse within these agencies is astounding. They don’t budget based on efficiency. I have yet to discover a leader in these agencies that submits a budget for less than the previous year. They’re incentivized to grow their agencies through increased funding and manpower. If you read their bio’s, they highlight the size of the budgets they manage and the number of workers on their payroll. They climb the ladder if they are successful in that process, not because they are efficient or even effective at managing the processes under their control. This mindset rolls out into the contracts issued by the government. Corporations and other private-sector companies that aren’t feeding off of government contracts have to operate on a different model; one of efficiency and effectiveness.
The bottom line is this: corporations are not the problem. Too much government is the problem.
No more hand outs to corporate welfare queens. Enough is enough.
Have you cleared this with Gainesville? He seems to fancy crony capitalism is da bomb if the UAW is on board.
This argument comes up every time the notion of making the rich pay their fair share is propounded. The same argument is made against stock transfer taxes on the NY exchanges (“They’ll just move to New Jersey!”). Then let them go. Then the U.S. can start rebuilding its own economy from the ground up without these tax dodging behemoths messing with every aspect of economic and political life in perpetuity. Where are the balls to hold them accountable?
It will be hard at first but then, like most everything else, it will become second nature, whereupon the possibilities that we have been denied while being ground into the dust by the rich will appear like a great renaissance. The alternative is to allow them to hold the country hostage to rampantly unsustainable and unjust economic policies forever.
The counterpart to this solution, although it cannot be counted on, is to draw up international tax dodging rules prohibiting this kind of hopping from one country to another (or from one state to another), so businesses that should be paying taxes cannot evade the responsibilities that everyone else has to shoulder.
The notion that companies will move if they get hit by taxes they are supposed to pay. Many take advantage of loopholes and tax deferments to bring their tax down to almost nothing. Yet expect to benefit from what this country has to offer. Let them leave. They won’t enjoy the protections from the constitution or military might of this country or access to this economy which they profit from. You can always impose an “exit fee” if they want to move operations outside the country. You want to make money by outsourcing? It’s gonna cost you. Want to base your corporate office in the Cayman Islands? It’s gonna cost you every year. It’s perfectly legal for congress to impose such fees or taxes. You want to enjoy all the benefits of this country? You better be paying for it if you want it. Basic free market stuff, right? Corporations expect to pay a little as possible or nothing at all to enjoy the benefits everyone else is paying much more for. Sounds like they are the welfare queens Reagan loved to exploit.
NOTICE TO WARTBERG AND SVELAZ:
you seem to be proposing “Capital controls.” I will have you know, that the centi-billlionaires who call the shots for your party like Soros and Bloomberg, are international financiers who object to any sort of national boundaries on the “THE FREE MOVEMENT OF CAPITAL.,”
Just as they object to national restrictioins on TRADE like what TRUMP did with tariffs on imported chinese goods
just as they object to national restrictions on LABOR ie migration as Trump has done
So sorry guys, you can say what you like, but the DNC is in their pocket and they will NOT be entertaining “restrictions on the free movement of capital”
that one is a NO CAN DO
might as well have expected Eric Holder to have prosecuted the financiers engaged in massive fraud in securitizing mortgages back in 2008
we see how many small fry he got and not one big name at all. That’s your Dem Party– party of INTERNATIONAL FINANCE. LIKE IT? VOTE JOE and if you think he’s gonna upset the apple cart for any of the big boys then you may one day find yourself sorely mistaken
might as well have expected Eric Holder to have prosecuted the financiers engaged in massive fraud in securitizing mortgages back in 2008
That would be the management of Fannie Mae and Freddie Mac, drawn from the Democratic insider nexus. NB, Paul Krugman was defending these outfits in print in 2008 and 2009.
What is their fair share? Right now the upper 50% pay almost the taxes. The bulk of it is paid by the upper ten percent. I notice the temporary exemption for the lower middle class put Piglosi in the no tax paying bracket. along with most of Congress. NO income tax is fair it’s a socialist fascist tax from start to finish. The only one that should be in effect is the end user consumption tax with no other taxes at any step of the production chain. Add to that the Right To Life Exemption as the only exemption meaning that which is needed just to survive. Then make total welfare of all types limited to two thirds of base pay. What’s the catch? None except government would then have to live within it’s means doing the jobs stipulated by the Constitution and not all this extra non essential crap.
Freeze congresses salaries now! When the inflation hits and their wages are worthless, maybe then they will see the irreparable harm they have caused the US.
Cut Congressional salaries and make them work from their home district. And put all government jobs out to contract, nationwide, from home.
This is very sad.