This page has been archived and commenting is disabled.
Please read my latest entry and post your comments here:
http://pensionpulse.blogspot.com/2010/05/end-of-welfare-states.html
Thank you,
Leo Kolivakis
- advertisements -
Contact Information:
Tips: tips [ at ] zerohedge.com
General: info [ at ] zerohedge.com
Legal: legal [ at ] zerohedge.com
Advertising: ads [ at ] zerohedge.com
Abuse/Complaints: abuse [ at ] zerohedge.com
Suggested Reading:
Make sure to read our "How To [Read/Tip Off] Zero Hedge Without Attracting The Interest Of [Human Resources/The Treasury/Black Helicopters]" Guide
It would be very wise of you to study our disclaimer, our privacy policy and our (non)policy on conflicts / full disclosure. Here's our Cookie Policy.
Well said Leo.
This is one of your very best Posts.
Thx for the Paste of Hudson's Counterpunch Article.
Brilliant in its quick historical summary!
3 Chord Sloth
Quit revising history to suit your narrative... The Ponzi schemes are results free-market ideologies. All you have to do is look at history: Reagan his attempt at gutting the idea of big government while his government overspent creating largesse. Does anyone here remember that in 1980, we were the biggest creditor in the world and after a few short years we became the largest debtor nation... How did this affect our debt? hmmmmm
Let's see, lets sell the public on the notion that government is too big. Let's fail to deliver crucial services so politicians will be viewed with antipathy. Let's get rid of the usury laws and de-regulate industry so we can turn finances into a Ponzi scheme... Simultatenously, lets send the message that people need MBA'S and Phds in the Arms of Race of accreditation and education.... Let's offer people access to billions of dollars of credit while selling consumption all during a period where financial literacy education did not exist... Let's make it more complicated for them with teaser rates, payday loans and predatory tactics. let's sell social darwinianism so no one has to feel bad about screwing over the collective whole because it is every 'man' for himself.... Oh yeah, this does not have anything to do with an agenda to dismantle the New Deal... right....
You confuse the capture of the agents of state by corporations with some sort of convoluted belief that states have no responsibility to assist their weakest members... And by suggesting that all people just need to work hard or pull themselves up by the bootstraps does not take into consideration how people actually live (as well as power, ethnicity, gender and cultural imbalances) that promote the very intergenerational transfers you argue against....
You convolute the issues to conform to world view.. not uncommon but not accurate
Sorry, I have to disagree. Government does not create any wealth, it merely redistributes it. there are some functions of government that we are willing to collectively pay for, and most of those are clearly delineated in the Constitution. Pray tell, what crucial services are the obligation of the State to deliver to its weakest members, that were curtailed by Reagan or any other 20th Century President? The obligation is not one of the State, it is an obligation of those caring individuals in society. There are churches, charitable institutions, and philanthropists that have in the past, and continue today, to fund these "obligations". Just because you think they are underfunded doesn't give you the right to vote yourself my money to fund your folly. And that's what this is, the folly of voting the wealth of future generations for others to enjoy today. The day of reckoning is here. No more funding from the future.
Pot, meet kettle.
Reagan, like most presidents, was an actor.
He had no principles and no ideology.
Well-said.
and the real problem is the FED.. since they keep printing, all these social funds can't just sit and let themselves dissolve vs. inflation so they have to be part of this casino investing game and then they get ripped off as sitting duck money
but if we stood on a solid backed currency - then the money can sit and things can be planned with more reason
Yep. It's like I always say:
The welfare state depends upon getting the workers to treat their own earnings like pieces of paper, numbers in a ledger. If dollars were still exchangeable for gold the welfare state would collapse.
Giving someone a government check for a thousand dollars seems easy... tossing them a Krugerrand seems wrong.
nice analogy - seems like gold can't decide whether to do this morning, parabolic advance on news or prepare to fund liquidation.
The Chicago School is dead, Leo.
It has no more living champions. They are discredited. Friedman attempted to accommodate Keynes and von Mises. He failed. He enabled the United States Government and its insanity, creating an intellectual framework and tax structure that lasted from the post-War period until now.
But now it's failed.
Even Nouriel Roubini, in his latest interview with the Financial Times, admits that the Austrian school is ascending: http://www.ft.com/cms/s/2/2cb543cc-595b-11df-99ba-00144feab49a.html
"These days he is “centrist” on economic issues, since he believes that governments need to spend money in a crisis to support the system, in line with Keynesian economic ideals – but he believes that when a crisis is over, they should revert to free-market approaches, reflecting the so-called “Austrian school” of economics. “There is this big debate between the Keynesian school and the Austrian school. But I am pragmatic and eclectic. It is all about timing.”
Larry Kudlow's still on board.
Are you kidding? The American Enterprise Institute...The Heritage Foundation...etc ad nauseam
The asshat zealots of deregulation are legion in the US. Hell, the TeaPotDomeExpress is giving their golden-boy from Mass a drubbing for voting for what piddling financial industry reform was left in the bill before congress.
Roubini is correct. Keynes, Hayek, etc...all useful toolsets for different economic problems. It's just that they all insist that their tool is the one to be used in all circumstances.
Good luck getting the government to ever admit "the crisis is over". Roubini may think this approach is "pragmatic", but it's actually quite idealistic in presupposing that the government hacks who run the "Department of Fixing The Crisis" won't find new "crises" to "fix" once the old ones are fixed.
One of the reasons I love the free market is that when push comes to shove, you take care of your business and I take care of mine and never the twain shall meet, except voluntarily. It's the "good fences make good neighbors" perspective applied to economics.
La Guillotine shall claim her bloody prize!
Blankfein is just a psychopath. Congress was the gatekeeper. The psychopath was not elected ergo our wrath should be applied in November.
RICO ACT folks!
The king shall kneel, and let his kingdom rise?
Chicago brought us EMH and Fama. Let's go to Austria for some real economic theory and solutions. How Benoit Mandelbrot bought Fama's thesis is beyond me--he must have been delusional at the time since he has now become much more illumined into the fractal nature of markets vs the fictitious EMH.
But back on topic of the real gist of the story, nothing unfunded lasts forever. Welcome to 2010. If only I had been born in Greece in 1925, became a hairdresser in 1942, and retired in 1975. I'd be 85 years old now and not really giving a shit since overall, it was a good life. A great life actually, until those morons created the EMU.
That was quite a rant against the 'Chicago School' and rentiers but what does it have to do with unaffordable welfare programs?
Is there some system of economics ( other than ponzi) that would allow workers to retire at some significant fraction of their pay at 55 or 60 financed with nothing more than future tax revenue?
Yes, how about living below your means and saving a significant portion of your earnings? But that's hard to do when the entire planet is borrowing and bringing the next 20-30 years of production into the present to simply consume.
Welfare programs are not unaffordable. Forget "unexpected", time to switch to "little noticed". Green shoots! http://legalinsurrection.blogspot.com/2010/05/little-noticed-is-new-unex...
I find it just too convenient and over-simplified to say that the so-called Chicago School is at fault or plotting some paradigm shift. That is purely "sour grapes" and an intellectual dis-honesty of the followers of the defeated Keynesian (infidels) and their "Multiplier" fantasy.
Global macroeconomics is not a zero-sum game. The Austrian approach will gain more credibility when this is over, but no theory (Austrian, Chicago, or other) or followers of a theory become the "winners."
Rather, I think you mis-read this point of time and course of events in history, Leo.
Life goes on, and a lesson needs to be learned...that sovereigns (governments at all levels) cannot continually borrow from the future to continually attempt to live the good life today. All resource use comes with a cost, borrowing to fund that cost further increases that cost (because then you are paying for both original resource AND capital usage), and there is no free lunch.
So, keep your accounts in order.
That means you, Greece.
The invisible hand
Is slapping down socialism again just as it did to the Soviet Union
Adam Smith did not say that the Invisible Hand existed only in capitalism. Adam's father was a clergyman. his book prior to the Wealth of nations Was "Moral Sentiments -- And he meant moral - as moral was defined in the 1760's.
The invisible hand giveth and the invisible hand taketh away.
It depends on how you treat you neighbor -- beware if you plunder -- steal from your neighbor --- beware if you use false scales ---beware if you naked short ---beware if you require your neighbor to buy carbon credits
What he is saying here is that debt crises (real or perceived)
have been manufactured. This is the final phases in a long term plan to gut
entitlement or the pejorative "welfare" programs. Seen in this way, one can
understand why fear, panic, gold, fiat currencies, stock markets and hyperinflation
have new meaning... These are structural problems that have been allowed to fester
for decades, but now is a great time to sell fear to finish off the last vestiges of New Deal
and help capital ascend to its 'natural' place in the Darwinian pecking order... Hence
free-markets, de-regulation and privatization.... Your final question assumes that taking
care of all people has fostering dependence... Some might suggest that context matters...
Presently, the whole globe is deleveraging from all of their commitment as commodities
will skyrocket, world population sustainability and natural resource access...
The article above is not a rant, but probably a decade or more of reading about economic
history, real lived experiences of people and realizing where the ideology began that led
us to where we are now...
The article is a rant.
The basis of the article is a valuation of "birthright". As you are born in a certain political jurisdiction you attain the "birthright" to have the rest of the world fund your affluent lifestyle.
Go ask the Chinese what they think about this "revolutionary" thesis...
yes but it requires that you let your grandmother live with you til' she dies...
That is one of the great tragic mistakes of my life. No one deserves to die in a nursing home if they have family. Even if other family members demand for you to leave them you shouldn't let them make the decision. sorry, so somber, anyone have a really kick-ass you tube video or joke. A merry heart is good like a medicine. I need a transfusion!!
Sure, but the peeps won't like the up-front involuntary savings plan that would be required to make social security fiscally balanced much.
And, politicians would just spend the "involuntary savings" NOW. They would pass a law deeming them "not spent." Much like the 'social security trust fund reduces the deficit" scam that LBJ started. Getting more money to the government is not a solution to anything. It just spawns more spending without paying off anything.
Then that is an issue with the politicians - not with people who paid into social security in good faith, believing it was being stored/invested for them as the govt promised to do.
Yeah - the politicians, all of them, all the time. What does that say about Government in general?
Then that is an issue with the politicians - not with people who paid into social security in good faith, believing it was being stored/invested for them as the govt promised to do.
Nope!
I think you mean euros and not pounds?