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Our Coming Age Of Austerity

fmw said:
No it isn't. The CEO is one person. The employee roster could be tens of thousands.
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And a 1 million dollar raise for a CEO could give 1000 employees a $1000 raise. Or a $10 million raise for ONE CEO could be used to give 5,000 employees a $2000 raise. Which have they been choosing? Which would help our economy grow faster?
 
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Shooterman35 said:
I did not realize I was interpreting the Constitution in any fashion other than what the words say one of the duties of the Congress is; To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;

I gather you don't like that interpretation so please express yours.



I presume we would be in agreement if I state a dollar is supposed to be money. We may not agree that money is supposed to have intrinsic value, that is, a substance or amount of work that has made it valuable. What is the value of a piece of paper and a dab of ink? By changing the number on a piece of paper doesn't make it more or less valuable.

Money is also supposed to be pretty stable and long lasting. For thousands of years, gold, silver, precious metals, diamonds, etc. were considered money until man, in his infinite wisdom within the last 50 to 60 years, made paper, by fiat, the monetary standard. An ounce of gold or silver refined 2000 years ago will still be and ounce of gold or silver today.

While true, over the history of Man, other items have been considered money, but like the Dodo Bird, they have all passed into oblivion. Gold, silver, platinum, etc have not made that same passage.
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The value of gold has fluctuated wildly over the centuries. When gold was brought back to the new world to Spain, it caused huge inflation, as the value of the metal fell. There is nothing intrinsicly valuable about that shinny yellow metal. It is only as valuable as man makes it. Paper dollars or even the dollars transferred electronically have value, as I can use them to buy goods and services that I desire.
 
JohnfrmClevelan said:
You said that it is unconstitutional for the U.S. to print their own currency. I think the opposite.



But currencies based on precious metals have. Is there a single gold-convertible currency still in existence?

The gold standard was so untenable that the U.S. had to give dollars away to keep the world's economy functioning. So much money was coming into America after WWII that other countries would have been stripped of their gold, had we not simply sent them dollars back in foreign aid. And today, were we still on a gold standard, other countries would have to send us aid, because so much gold would be flowing to any nation that chose to keep its labor force in poverty for the sake of obtaining gold. Do you think the Chinese would be willing to just hand us our gold-convertible dollars back to us, in order to keep the wheels turning? I highly doubt it.

If you like gold, go out and buy some. That's more than you could do during the gold standard days.
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You mean that is more than what I could do after FDR stole America's gold.
 
iguanaman said:
And a 1 million dollar raise for a CEO could give 1000 employees a $1000 raise. Or a $10 million raise for ONE CEO could be used to give 5,000 employees a $2000 raise. Which have they been choosing? Which would help our economy grow faster?
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That would be a good thing to do if the board of directors is sure that the action would retain the CEO (assuming an effective one.) Good CEOs don't have a big problem finding jobs that pay more.
 
Shooterman35 said:
By Patrick J. Buchanan

“Are the good times really over for good?” asked Merle Haggard in his 1982 lament.

Then, the good times weren’t over. In fact, they were coming back, with the Reagan recovery, the renewal of the American spirit and the end of a Cold War that had consumed so much of our lives.

Yet whoever wins today, it is hard to be sanguine about the future.

The demographic and economic realities do not permit it.

Consider. Between 1946 and 1964, 79 million babies were born — the largest, best-educated and most successful generation in our history. Bill Clinton and George W. Bush, both born in 1946, were in that first class of baby boomers.

The problem.

Pat Buchanan
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The Reagan recovery was NOT a recovery. It was simply more deficit financed stimulus driven by military/industrial spending as Reagan enlarged the armed forces.

And the Clinton and GW Bush booms were artificial dot com and real estate bubbles both of which finally burst once the stimulus was cut off.

Prosperity has been fairly artificial for the world ever since the WW2 militarization and mobilization against Adolf and Tojo.

If you lived through it, you actually have Adolf and Tojo to thank for world prosperity from 1941 through about 1968 while times were artificially good.

Starting with Nixon inflation began to come knocking resulting in his price controls programs.

Inflation was rampant during the Carter era, but slowed down somewhat during Reagan.

Since 2008 inflation has been nonexistent throughout the great recession, but of course Janet Yellen is paid to start worrying about it again.

The point being that every stimulus to the US and world economies since 1941 have been artificial.

There has been no real intrinsic growth in the USA or world at all.
 
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Riveroaks said:
The Reagan recovery was NOT a recovery. It was simply more deficit financed stimulus driven my military/industrial spending as Reagan enlarged the armed forces.

And the Clinton and GW Bush booms were artificial dot com and real estate bubbles both of which finally burst once the stimulus was cut off.
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All understood.
 
Shooterman35 said:
You mean that is more than what I could do after FDR stole America's gold.
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Any numismatic base is going to either retard growth when the metal is in short supply or overinflate it when the metal becomes readily available.

Pegging your nation's currency to treasure is foolishness.

The modern Federal Reserve System works quite well to allow economic growth.
 
MTAtech said:
The value of gold has fluctuated wildly over the centuries. When gold was brought back to the new world to Spain, it caused huge inflation, as the value of the metal fell. There is nothing intrinsicly valuable about that shinny yellow metal. It is only as valuable as man makes it. Paper dollars or even the dollars transferred electronically have value, as I can use them to buy goods and services that I desire.
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Gold has very little true value. It is a speculation device only.

You can use it for electronics, like silver, and you can use it in making reflective insulational glass for high rise buildings.

But it is not good for anything else except jewelry.

It is merely a speculative commodity such as platinum.

Silver and copper are infinitely more useful than gold, although oddly they are "valued" lower.
 
longview said:
Well the first problem is that both of them only produced 3 children between them.
Part of what fueled our economic expansion, was our population expansion, and all
those baby boomers wanting the American dream, and willing to work for it.
There is still a possibility for the US to be great, but we are consumed with internal noise.
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You are only looking at the demand side of the economic equation however.

On the supply side, there needs to be reasonably priced goods and services produced locally at marketable prices so that everyone can have a job and participate in the economy with each other.

There is also the education side. American schools are failing badly in teaching the American youth anything. Thus foreign English speaking workers from India, Pakistan, and China are being imported in boat loads to do the sophisticated high tech work here in the USA. American kids cannot compete here at home for these high paying jobs because they spend their lives ill taught, while they escape into dope, alcohol, and teenaged sex -- compounding their problems even worse.
 
JohnfrmClevelan said:
From the article:

"But there is nothing left in the till to do big things. One sees only deficits and debt all the way to the horizon."

Pat Buchanan should try looking backwards, too. Because he would see deficits and debt all the way to the other horizon, too. Debt and deficits obviously don't prevent the country from doing big things. In fact, they enable big things.
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Arent there downsides to too much debt though? If not, shy don't we just run trillion+ dollar deficits all the time?
 
fmw said:
That would be a good thing to do if the board of directors is sure that the action would retain the CEO (assuming an effective one.) Good CEOs don't have a big problem finding jobs that pay more.
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You are not saying they deserve those $20 million salaries only that the market has pushed them up and up. If they were paying 80% tax on everything over a million a year do you think the market would have pushed salaries of CEO's to such astronomical heights? Do you think any person "needs" over a million $ a year?
 
Fletch said:
Arent there downsides to too much debt though? If not, shy don't we just run trillion+ dollar deficits all the time?
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The danger is too much demand for our economy to handle, which would lead to inflation. So, no, you can't just spend trillions of dollars without inflation. But our economy could certainly handle far more business than it does now.
 
Riveroaks said:
Ok so what's your solution?

Is there a solution?

Or is the solution merely austerity then?
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I believe austerity is coming whether we like it or not. Sooner or later the Piper must be paid.

Households can't continually run deficits amassing humongous debt. Why in the world should we expect government to be able to?
 
Shooterman35 said:
I believe austerity is coming whether we like it or not. Sooner or later the Piper must be paid.

Households can't continually run deficits amassing humongous debt. Why in the world should we expect government to be able to?
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Households cannot do that, you are correct.

Borrowings are simply a temporary boost in economic possessions.

For the longest time people thought they could borrow on their houses and condos, then someone else would come along and eventually assuredly take the mortgage off their backs. This thinking was very popular and all the rave back in 1975 to 1980 and beyond.

A lot of those people are homeless now. But the earlier crowd checked out and made a profit that way.

Best thing to do is get a good education, paid for by scholarships or by the US military when possible, then get a good civilian job, or retire from the military and get a second job, save at least 10% to 25% of your pay annually, and stay out of debt, living within your means.

If you call this "austerity" and that's what you really mean then it is simply a change from the 1975's and 1980's generation of high school and college grads -- late baby boom and post baby boom -- who have been riding the debt wave since they got their first jobs.
 
iguanaman said:
You are not saying they deserve those $20 million salaries only that the market has pushed them up and up. If they were paying 80% tax on everything over a million a year do you think the market would have pushed salaries of CEO's to such astronomical heights? Do you think any person "needs" over a million $ a year?
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Need and deserve have nothing to do with anything in business.
 
fmw said:
Need and deserve have nothing to do with anything in business.
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Correct. Which is why public regulation of business is so important. Otherwise we would be back to the days of the robber barons before you could shout, thief!
 
iguanaman said:
You are not saying they deserve those $20 million salaries only that the market has pushed them up and up. If they were paying 80% tax on everything over a million a year do you think the market would have pushed salaries of CEO's to such astronomical heights? Do you think any person "needs" over a million $ a year?
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It's not the market driving up CEO salaries, it's the incestuous relationship web between management and boards of directors. The only check on that power comes from fund managers that control large blocks of stock.
 
Shooterman35 said:
I believe austerity is coming whether we like it or not. Sooner or later the Piper must be paid.

Households can't continually run deficits amassing humongous debt. Why in the world should we expect government to be able to?
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Because households cannot create their own currency. Because households don't have central banks. Because households don't last forever. Because governments don't borrow from banks. Etc., etc....

Wray: The Federal Budget is NOT like a Household Budget – Here’s Why | naked capitalism

Why the federal budget is not like a household budget

Why the federal budget can't be managed like a household budget | Money | The Guardian

The Federal Budget Is Not a Household Budget - US News

Why The Federal Budget Is Not Like A Household Budget | Lifehacker Australia
 
Shooterman35 said:
I believe austerity is coming whether we like it or not. Sooner or later the Piper must be paid.

Households can't continually run deficits amassing humongous debt. Why in the world should we expect government to be able to?
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You spend, governments redistribute.

You have no control over macroeconomic trends, many (major) governments do.

Your expenditures are a one shot deal, hopefully to your benefit (but not within your personal control).

Large scales spending beyond current resources could, and historically has, provided long term benefit for society. The same for yourself will likely result in only debt.

The comparison of household debt to public debt is another form of spin put out by those that have the most to gain by such statements. Can you guess who that might be?
 
JohnfrmClevelan said:
Because households cannot create their own currency. Because households don't have central banks. Because households don't last forever. Because governments don't borrow from banks. Etc., etc....
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State and municipal governments can't create their own currency. And they don't have central banks. The Alaska budget is being destroyed by low oil prices. Alaskan cities and boroughs can't fund their depreciation, relying instead on a lot of state grants for capital infrastructure investment, which now have basically ceased to exist. What other option is there for states and cities like ours that wouldn't meet the monetarists' definition of austerity? It would be great if there were more federal money for infrastructure, but it seems like the whole effing federal budget goes to DHHS, SSA and DoD.

This is why I can't understand why the monetarists apparently care not at all whatsoever how federal money is spent, only that it is in fact spent, and seem annoyed when spending priorities are brought up.
 
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Neomalthusian said:
State and municipal governments can't create their own currency. And they don't have central banks. The Alaska budget is being destroyed by low oil prices. Alaskan cities and boroughs can't fund their depreciation, relying instead on a lot of state grants for capital infrastructure investment, which now have basically ceased to exist. What other option is there for states and cities like ours that wouldn't meet the monetarists' definition of austerity? It would be great if there were more federal money for infrastructure, but it seems like the whole effing federal budget goes to DHHS, SSA and DoD.

This is why I can't understand why the monetarists apparently care not at all whatsoever how federal money is spent, only that it is in fact spent, and seem annoyed when spending priorities are brought up.
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Kind of a jumbled, mixed-bag post here.

Does your recognition that state and local governments are under real budget constraints also mean that you understand that the federal government is not? If so, terrific, you understand that the federal government is able to deficit spend for the benefit of the private sector.

I think you have your economic schools of thought mixed up. Monetarists (Milton Friedman et al) believe that you can control and maximize the economy by controlling the amount of money in play. That was the genius thinking behind the euro. They hate deficits.

The idea that deficits do not matter is certainly not the mainstream view. If it was, good policy might include federal grants to states, to alleviate their budget problems.
 
JohnfrmClevelan said:
Kind of a jumbled, mixed-bag post here.

Does your recognition that state and local governments are under real budget constraints also mean that you understand that the federal government is not? If so, terrific, you understand that the federal government is able to deficit spend for the benefit of the private sector.
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Yes, but what concerns me is that some seem to stop caring beyond this point, and have no apparent interest in the very disparate ways and degrees in which the spending benefits the private sector. "Someone gets the money, which gets circulated and that stimulates growth so all is fine." Naive or apathetic, one of the two.

I think you have your economic schools of thought mixed up. Monetarists (Milton Friedman et al) believe that you can control and maximize the economy by controlling the amount of money in play. That was the genius thinking behind the euro. They hate deficits.
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I was thinking monetary theorists, thanks for the terminology correction.

The idea that deficits do not matter is certainly not the mainstream view. If it was, good policy might include federal grants to states, to alleviate their budget problems.
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It's not just budget problems, I mean it is, but more of a general welfare problem. A lot of places can't afford their basic infrastructure maintenance. Should they be deprived and encouraged to pack up and head to the cities?
 
Neomalthusian said:
Yes, but what concerns me is that some seem to stop caring beyond this point, and have no apparent interest in the very disparate ways and degrees in which the spending benefits the private sector. "Someone gets the money, which gets circulated and that stimulates growth so all is fine." Naive or apathetic, one of the two.
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I don't think that's true at all. I certainly have my own ideas about how the government should spend money. But I'm not going to bother geting into those details when people still don't understand (or accept) that governments can and do spend without going into real debt. First things first.
 
They did not "compete" with slaves.

We do.

So guess where that leaves us. All post 1965 people. *******ED
 
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