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Guest Post: R.I.P, Homo Economicus: On the End of Ubiquitous Poverty and the Beginning of Universal Abundance

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Submitted by Free Radical

R.I.P, Homo Economicus: On the End of Ubiquitous Poverty and the Beginning of Universal Abundance

“I draw the conclusion that, assuming no important wars and no important increase in population, the economic problem may be solved, or be at least within sight of solution, within a hundred years. This means that the economic problem is not – if we look into the future – the permanent problem of the human race.” – John Maynard Keynes, Economic Possibilities for Our Grandchildren, 1930, [author’s emphasis]

There have of course been some “important” wars (though in truth they were, and remain, mere installments in a Long War that is by no means over).  And there has of course been an “important” increase in population (the abreaction, for the most part, of the premodern underbrush that was uprooted amid the modern nation-state’s relentless campaign of unification, centralization, and consolidation).  But let us give Keynes his due for imagining a time, in the not-too-distant future, when “the economic problem” – which is to say, the scarcity that impels all economic endeavor – will at long last have been solved, and universal abundance is at hand.  Let us do so, however, with no illusions about who the man was, fully acknowledging that he was “a charming but power-driven statist Machiavelli, who embodied some of the most malevolent trends and institutions of the twentieth century” – so malevolent, in fact, that one is left to wonder what Keynes might have had to do with the fact that, eighty years later, a solution to “the economic problem” seems more out of reach than ever.

After all, standardizing for population growth since 2005, the chart below would now indicate that fully 5.5 billion people live on less than ten dollars a day, while nearly a billion live on less than a dollar a day:

And while America’s poor appear to be quite well off by world standards, the fact is that they now represent nearly 14% of the U.S. population and that their numbers are skyrocketing, as the real unemployment rate surges toward 25%:

And not surprisingly, food stamp use is also skyrocketing:

 

Which is to say that Americans in general are an ugly mix of Stanley Johnsons so buried in debt that their toys have either already been taken from them or soon will be,  their spending now in freefall, as it returns to its historically sustainable level (after, in all likelihood, overshooting it):

All of this happening as income inequality rises to extremes not seen since 1929:

But this was to be expected, after all, as the fascism inherent in the U.S. banking system reaches its apotheosis in the privatization of profits and socialization of losses, such profiteering, regardless of how it manifests itself, being standard operating proce-dure for the state.  For while it “is almost universally considered an institution of social service,” the state is really nothing more than “the systematization of the predatory pro-cess over a given territory.”  Why?  Because

the state cannot even exist without committing the crimes of extortion and robbery, which states call taxation; and as a rule, this existential state crime is but the merest beginning of its assaults on the lives, liberties, and property of its resident population.

And simply put, these assaults – whether perpetrated by the U.S. fascialist state or variations upon this theme elsewhere around the world – have so impoverished the masses (why else would they be the masses?) that to contemplate an imminent solution to “the economic problem” admittedly seems absurd.

Nonetheless, let us return to Keynes meditation thereon and, in particular, to his ob-servation that the historically “slow rate of progress, or lack of progress, was due to two reasons – to the remarkable absence of important technical improvements and to the failure of capital to accumulate.”  For surely this is so, not just because the state’s “predatory process,” century after century, has so hampered capital accumulation as to stunt technological advance but because, in the last century, the state’s predations were fully systematized.  And they were systematized in no small part because of Keynes’ absurd belief that “there are no intrinsic reasons for the scarcity of capital.”  For just as there is not (there never was, nor will there ever be) any genuine capital accumulation that is not the result of savings – specifically, the saving of productive work of one form or another – so is there an inherent limit to capital.  And as savings are nothing other than deferred consumption, it is clear that one cannot simultaneously consume that which one defers the consumption of, which is to say, one cannot have one’s cake and eat it too.

This is precisely what Keynesianism attempts to do, however, facilitated by the attendant notion that money is not a good used as a medium exchange but simply a medium of exchange that, being irredeemable for any good, can accordingly be generated without limit.  No wonder, then, that with both capital and money thus unhinged from economic reality, governments, in thrall to this alchemical fantasy – would systematically plunder their countries’ economies to the point of grinding them to a halt:

A major part of the growth in the last 100 years and especially in the last 40 years has been built on an unsustainable build-up of debt levels. These debt levels will continue to swell for another few years until the coming hyperinflation in the West leads to a destruction of real asset values and a debt implosion.

We have hell to pay for the sins of Keynesianism, in other words, the only question being what level of hell we descend to.  And as this is largely a function of how long the journey takes, it is in turn a function of how “successful” governments’ extend and pretend policies are, meaning that the longer they delay the onset of economic reality, the deeper into hell we will descend.

So again, under the circumstances – that is, given governments’ unremitting deter-mination to exacerbate the devastation that their Keynesian folly has already caused – how can we even contemplate a solution to “the economic problem,” much less postulate an imminent solution?

We begin by considering what our lives would be like if we hadn’t been subjected not only Keynesianism but to its indispensable precondition – that is, if we had lived all this time within the liberating confines of sound money, which by definition has two complementary and vitally important aspects: (1) “It is affirmative in approving the mar-ket's choice of a commonly used medium of exchange,” and (2) “It is negative in ob-structing the government's propensity to meddle with the currency system.”  And since gold has manifested these two aspects for over five thousand years, we assert without equivocation that a sound monetary system is a 100-percent-reserve gold standard that accordingly “secure[s] the economic system against the evils both of inflation and of de-flation/depression.”

And let us also assert that however beneficial this twofold security would be, such a monetary system would do much more than that.  For “the typically modest increase in the quantity of money and volume of aggregate spending that takes place under a gold standard is accompanied by actually falling prices [author’s emphasis],” the greater production and supply of a good (or service) being a result of the greater efficiency that is expressed as Total productivity = Output quality and quantity / Input quality and quantity.  That is to say, as input quality rises and input quantity falls, both output quality and quantity rise, resulting in the increased productivity that is reflected in the ability to offer the same product (or service) for less or, alternatively, a better product (or service) for the same price.

And we have of course been experiencing this very phenomenon for many decades now, as the cost of computing power has fallen precipitously, the industry’s productivity increasing in accordance with what has come to be known as Moore’s Law:

The computer/electronics industry, in other words, has accomplished what the rest of the economy has not – i.e., an increase in productivity sufficient to offset government-induced inflation – the point being that in a truly sound-money economy, the gain in purchasing power would be across-the-board.  That is, increased productivity would result, over time and in all sectors of the economy, in falling prices that would not be deflationary for the simple reason that they would not be the result of a monetary contraction, the difference between the two being all the difference:

What this means is not only that in a sound-money economy, prices would fall as productivity rises; it also means that in an increasingly computer-driven, nano-technological, sound-money economy – where computing power rises as machine size falls – productivity would grow exponentially, not only driving prices down at a similar rate but ultimately driving them to the vanishing point , which is to say, to zero. 
For example:

We are awash in energy (10,000 times more than required to meet all our needs falls on Earth) but we are not very good at capturing it. That will change with the full nanotechnology-based assembly of macro objects at the nano scale, controlled by massively parallel information processes, which will be feasible within twenty years. Even though our energy needs are projected to triple within that time, we’ll capture that .0003 of the sunlight needed to meet our energy needs with no use of fossil fuels, using extremely inexpensive, highly efficient, lightweight, nano-engineered solar panels, and we’ll store the energy in highly distributed (and therefore safe) nanotechnology-based fuel cells. Solar power is now providing 1 part in 1,000 of our needs, but that percentage is doubling every two years, which means multiplying by 1,000 in twenty years.

Let’s say that by “extremely inexpensive,” we’re talking about the solar equivalent of dollar-a-gallon gasoline in 2030.  We are then talking about a less than one-cent-gallon equivalent seven doublings later and less than a tenth of a cent three doublings after that, meaning that by 2050 the world’s energy needs would be met at virtually no cost. And simply put, to apply this same logic to the economy as a whole is to understand how “the economic problem” stands to be solved and how universal abundance therefore stands to be achieved.  Not eons from now, not millennia, not centuries, but decades.

While Keynes had only a faint notion of this hyper-productivity dynamic, we can at least give him his due for imagining that it wouldn’t be long before man would be “faced with his real, his permanent problem – how to use his freedom from pressing economic cares, how to occupy the leisure, which science and compound interest will have won for him, to live wisely and agreeably and well.”  For that “science and compound interest” are nothing other than the exponential growth in technology that, aided and abetted by sound-money’s inherent price-reducing proclivity, do in fact have the power to free man “from pressing economic cares.”

Unfortunately, however, we must also give Keynes his due for helping to postpone that day, his contempt for what he perceived as a barbarous relic leading to FDR’s confiscation of the people’s gold in 1933 and thus the end of what remained of the gold standard in the United States (the world gold standard ending in the Nixon Shock of 1971).  For with no further restraint on the international banking cartel, the full fury of the stealth tax would be loosed upon the world and vast swaths of its people (most notably the American people) sold into debt slavery, the supreme irony being that “the eco-nomic problem” could well have already been solved, had a sound monetary system been in place during the near-century that the cartel’s foremost member has held sway.  For the pseudo-productivity of much of the U.S. economy would have been genuinely so, as would the rest of the world’s.  And the wars that could not have otherwise been funded would not otherwise have been fought, nor would our socially debilitating welfare programs have had the wherewithal to entrench themselves, the combined depredations of which have sapped incalculable amounts of humanity’s time, talent, energy, and imagina-tion.

Even so, such is the ordinary man’s inborn ingenuity that despite those depreda-tions, he may yet find himself, in 2030, confronting the fact that “his real, his permanent problem” isn’t a problem at all.  For what Keynes didn’t envision is that the ordinary man a century later, having decades before begun to internalize his machines, would be quite extraordinary, empowering himself to the point of not only boldly going where no man has gone before but of becoming what no man has ever been before.  No longer having to struggle with the problems of tired old homo economicus, that is, a vibrant young homo abundus would be charting a course that would have been beyond his predecessor’s wild-est dreams.

But as those dreams may yet be shattered, we will postpone further examination of homo abundus until we’ve taken full measure of “the predatory process,” beginning with my next submission: “The Twin Pillars of Civilization.”

 

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Wed, 11/24/2010 - 21:59 | 753948 Treason Season
Treason Season's picture

Hitler's plan to save Ireland

http://www.youtube.com/watch?v=ryqaGPMWFMM

Thu, 11/25/2010 - 05:25 | 754333 Shylockracy
Shylockracy's picture

Exceedingly funny, thanks.

En passant, there are two countries whose names are derived directly from the Indo-European word "Aryan", namely, Ireland and Iran.

Iran is already doing its bit by not playing ball with the international crime syndicate that rules the US, Canada and Europe. This is Ireland's chance to revolt, give a big fat finger to the bankster syndicate and recover her dignity. The Irish would be forever remembered and thanked as the saviours of whatever is left of Western civilization.

Thu, 11/25/2010 - 11:37 | 754563 -Michelle-
-Michelle-'s picture

Ireland comes from the Gaelic name "Eire" and the Germanic "land."  Eire was the Irish goddess of the land.

Iran derives from the Persian "Eran."

Aryan itself derives from the Sanskrit word "arya."

 

Thu, 11/25/2010 - 21:57 | 755297 Rusty Shorts
Rusty Shorts's picture

The Irish people are one of the 13 tribes of Israel, who were enslaved and carried off to Babylonia (Persia) and became one the lost tribes.

Fri, 11/26/2010 - 04:08 | 755565 Anton LaVey
Anton LaVey's picture

Yes, and my name is Napoleon, and I am the Emperor of the French.

Seriously, people, how much nonsense can you post on ZH in 24 hours?

Fri, 11/26/2010 - 22:44 | 756791 Rusty Shorts
Rusty Shorts's picture

"There is a theory that the Irish, or that Insular Celts as a whole, are descended from the Ten Lost Tribes. Proponents of this theory state that there is evidence that the prophet Jeremiah came to Ireland with Princess Tea Tephi, a member of the Israelite royal family.[54] Proponents of this theory point to various parallels between Irish and ancient Hebrew culture. For example, they note that the harp, the symbol of Ireland, also plays a role in Jewish history, as the musical instrument of King David. Some maintain that the Tribe of Dan conducted sea voyages to Ireland and colonized it as early as the period of the Judges under the name Tuatha Dé Danann.

Aspects of this theory are also sometimes cited by adherents of British Israelism, as one possible explanation of how the Ten Lost Tribes might have reached the British Isles. However, British Israelism takes many forms, and does not always use this hypothesis as its main narrative"

 

http://en.wikipedia.org/wiki/Ten_Lost_Tribes

 

 

 

 

Wed, 11/24/2010 - 21:59 | 753950 doolittlegeorge
doolittlegeorge's picture

And a Happy Turkey Day to you, too.  Never forget "this day had nothing to do with the Pilgrims and everything to do with a Civil War."

Wed, 11/24/2010 - 23:02 | 754028 jeff montanye
jeff montanye's picture

thanks for the history lesson.  see where fdr gave it a little more shopping time before christmas. 

Fri, 11/26/2010 - 09:59 | 755694 boooyaaaah
boooyaaaah's picture

George Washington's 1789 Thanksgiving Proclamation

Whereas it is the duty of all nations to acknowledge the providence of Almighty God, to obey His will, to be grateful for His benefits, and humbly to implore His protection and favor; and Whereas both Houses of Congress have, by their joint committee, requested me to "recommend to the people of the United States a day of public thanksgiving and prayer, to be observed by acknowledging with grateful hearts the many and signal favors of Almighty God, especially by affording them an opportunity peaceably to establish a form of government for their safety and happiness:"

Wed, 11/24/2010 - 22:00 | 753952 gwar5
gwar5's picture

He sounds like a marxist there. I wonder if Keynes really envisioned deficit spending and debasement as a permanent condition, or, just 'priming the pump'. Would he approve of Bernanke?

I know what Krugman thinks.

 

 

 

Wed, 11/24/2010 - 22:30 | 753996 nmewn
nmewn's picture

Keynes economic theories stem from a deeper core set of beliefs.

If you trace it back it merges with a belief system that there will always be a statist elite class...to support them, the worker class...then the bottom class.

At it's core is eugenics...something the bottom class has never heard of.

Thu, 11/25/2010 - 10:44 | 754511 zaknick
zaknick's picture

Exactly!

Thu, 11/25/2010 - 11:39 | 754566 -Michelle-
-Michelle-'s picture

Oh, they've heard of it.  They just called it "Planned Parenthood."

Thu, 11/25/2010 - 12:47 | 754678 boooyaaaah
boooyaaaah's picture

After WW1

The War That started in trenches where the US Civil war ended, and ended with tanks and bombers.

Then the farms used deisel powered Combines, Harvesters displacing unskilled farm hands, And the plow horse industry.

http://en.wikipedia.org/wiki/Mechanised_agriculture

Prices especially food dropped , and the now unemployed farm hands became a burden to feed.

And this lead to the great deflation (depression)

Today the mechanization of India and China, the easy transformation and exportation of creative ideas is likewise causing prices of everything to drop and unemployement in the high priced West

Displaced labor in the West adds to the problem as politicos try to cure it through deficit spending and buying votes.

One article I read on ZH noted that once polititians realized that deficit spending could be finaced through money creation -- rather than taxation -- our society was doomed.

How many union telephone operators, linemen,installers, paper manufacturers, map publishers, book printers, newspaper printers, encylopedia salesmen etc etc are now unemployed  because I have a smart phone for $200 plus a montly fee -- which because of inflation is getting lower and lower.

The solution of Printing Money to rebalance the economy does seem criminal, but rapidly dropping prices , which does spread from one industry, farming, to others, auto production

Tyler is a beneficiary of the changes and is clamoring for the preservation of money's old value. Because he is making more and doesn't want it depreciated.

Ask Tyler if he wants to work for a old fashioned Newspaper --- a company,and a tycoon, that had the financial wealth to purchase the presses and hire the labor to keep them rolling. This wealth, formerly required, has been dispersed so a smart kid like Tyler can be independent of the cigar smoking Tycoon.

So the cost of publishing has fallen, but Tyler wants the same dollar in his pocket that the Tycoon of 1900 had in his pocket.

Doesn't work that way Tyler you big cry baby.

Why dosent Tyler figure a way that the dollar of today's publishing can be related to the dollar of the last Century's publishing.

I know if it took a million dollars to get a paragraph out a century ago -- Building, Presses, Paper, Ink, Workers, Delivery Boys, ----

Then today after a few minutes on a lap top, a few cute assistants, and the almost free internet --- it takes 100 dollars -- and dropping -- to publish a paragraph.

That is why the value of money changes

Tyler should figure how to effect a change with the now useless buildings, equipment and workers. Rather than ranting that he wants to continue to be paid in Tycoon dollars.

He would not know how manufature or run a press or fold a newspaper

And for that matter he only knows how to use the internet not how it works.

His value is much less that the Tycoon of the 1900's. And inflation maybe the only way to pry dollars from the grip of the Tycoon so people like Tyler has a chance to fullfill his destiny.

Remember Spain Got the Gold thinking it was wealth.

England got Shakespeare and Francis Drake 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wed, 11/24/2010 - 22:38 | 753997 snowball777
snowball777's picture

On the 'permanent condition':

"To dig holes in the ground", paid for out of savings, will increase, not only employment, but the real national dividend of useful goods and services. It is not reasonable, however, that a sensible community should be content to remain dependent on such fortuitous and often wasteful mitigations when once we understand the influences upon which effective demand depends."

On the Bennie and the Inkjets:

Lenin is said to have declared: "The best way to destroy the capitalist system is to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens."

By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become 'profiteers,' who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.

 

Wed, 11/24/2010 - 23:40 | 754078 jeff montanye
jeff montanye's picture

re: lenin.  as you know it is keynes's magnificently prescient book about the end to ww1 (the great war), "the economic consequences of the peace" that, approvingly, is the most cited source of the lenin observation.  

keynes is a far more complex mind than many on this site seem to think.  what we have and are experiencing is not keynes's keynesianism.  he was not a fool.  he advised saving resources in fat times to spend them in lean.  

in moments of impatience with the uncomprehending world he used patently absurd examples (burying jars of money then paying working people, not bankers, to dig them up) to "jar" people's minds into seeing what he saw (and, to a degree, what good princes and kings have seen for millennia): save in fat, spend in lean.  the modern nation state's monetary system (not to mention global trade and food preservation) made this easier than storing grain, what with the wheat ergot and all.  

what we have experienced and are experiencing is keynes stood on his head: deficit spending and wild federal debt expansion in prosperity and (soon if the imf, ecb, et. al. have their way) austerity in scarcity.

Wed, 11/24/2010 - 23:47 | 754089 snowball777
snowball777's picture

Agreed, but it's well-nigh impossible to get the predisposed who frequent these parts to consider such subtleties. It's a pleasant surprise to run across someone who has actually read Keynes' work; doubly so on ZH.

Thu, 11/25/2010 - 03:09 | 754272 traderjoe
traderjoe's picture

TD posted a decently long article on Keynes a few months ago that went further into his beliefs, and argued that even Keynes would be turning over in his grave right now. I think most people on this site realize his name has been attached/co-opted to an over-simplified version of his theories/writings. 

Thu, 11/25/2010 - 12:19 | 754635 Dick Buttkiss
Dick Buttkiss's picture

I take it, then, that you take issue with Rothbard's appraisal, as cited in the first paragraph of FR's post:

http://mises.org/etexts/keynestheman.pdf

If so, I'd like to hear more about Keynes' "subtleties."

Thu, 11/25/2010 - 00:04 | 754110 nmewn
nmewn's picture

The problem...of course...is his "theory" relied on others to "perform"...human action.

They don't...and never will...because they can't in a "free economy"...ergo...works best under despots & dictators...who would of course loot the treasury for their own personal needs & desires.

Again...Human Action...completely outside the bounds of mathematics ;-)

I think close to a century of failure is enough.

Done.

SeeYa

Fri, 11/26/2010 - 20:23 | 756588 chopper read
chopper read's picture

I think close to a century of failure is enough.

 

keynesian economics, at its best, succeeds in punishing the saver and investor (never allowing for falling prices) and rewards reckless borrowing and rabid consumption at the expense of conservation.

worse yet, these keynesian apologists continue to enable the thievery with cries of,

"THEY'RE JUST NOT DOING IT RIGHT!"

After 54 years of communism in Cuba, are they "just not doing it right"?

...and since Keynes and FDR had to take 8,000 tons of our gold in order to enact this grand scheme of looting, can we please now have our gold back since it is a dismal failure?

 

next time, we do not give up our gold.  

i've got loads of friend all over the midwest who are stockpiling guns, and have silos of corn and fields full of livestock.  we're well aware these keynesians will be coming for it when they do not get their SDR one-world currency.  We intend to stand between them and the last bit of stuff still controlled by common people in America.  

Fri, 11/26/2010 - 22:21 | 756756 nmewn
nmewn's picture

I'm with ya chopper...we haven't quite formed cells yet...LOL...but the discussion with friends & family is the same...even among my "liberal" friends...we have withdrawn our consent to be governed by these clowns even as we try through peaceful means to change it back to some semblence of reality.

Something is clearly stinking and it's coming from DC & NY...everyone smells it.

More to your point...in my view, Keynesian "theory" was taken up by the statists (and thus elites everywhere) because it comports with their world view of desiring domination over the seething masses...it gave them a sense of control.

Yes, by saying gave, I'm speaking in the past tense...it's in it's death rattle I believe.

Of course, socialists/communists/fascists have now begun to use the soft term for these variants of anti-individualistic thinkers...called "progressive"...but it is the same thing.

That dog won't hunt...LOL.

Great post below by you by the way...it's well worth others time to drop down and read it...or they can skip to here;

http://www.zerohedge.com/article/guest-post-rip-homo-economicus-end-ubiquitous-poverty-and-beginning-universal-abundance#comment-756653 

 

Thu, 11/25/2010 - 05:02 | 754324 AnAnonymous
AnAnonymous's picture

he advised saving resources in fat times to spend them in lean.

 

Nice. But in a consumption game, this way of doing is probably the least effective of all. People who save in a game consumption only spare resources for people who do not save.

Running debt all the times is the best to capture an optimum of resources.

We are in this paradigm. Debt is only a tool to justify present consumption by the promise of repleting it in a near future. That story on energy is just part of the scheme. The west is consuming like mad energy sources that are known to be limited but in return, promise to come with new energy forms that will dwarf the previous ones.

Debt is simply a way to capture as much as possible of the current amount of resources.

Saving is stupid in the current framework. The whole stuff has always been about getting deeper in debt to consume even more, not about how to pay back the debt.

We have been defaulting now for decades and people in charge know that it is highly likely that the consumption brought from the future (debt) into the present will not meet an equivalent in the future.

 

By the way, the new paradigm (among the four) will be to run deficitis in good times (to fatten the soon to be extorted) and then run austerity programs in harsh times (to cut off dead wood)

Thu, 11/25/2010 - 05:28 | 754335 Popo
Popo's picture

Great quote.  It's one of the best to describe our current situation.  It's the last part of that quote that is so frequently ignored:

" As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery. "

And there you have 2011, in a nutshell.


Thu, 11/25/2010 - 02:00 | 754227 midtowng
midtowng's picture

Keynes sounded like any utopian. Nothing to indicate marxism.

Thu, 11/25/2010 - 08:10 | 754417 bigelkhorn
bigelkhorn's picture

Krugman, isnt he just another elitist trying get in the way of the truth.

Bernanke is either the dumbest idiot or the smartest genious the way he is carrying on and making it look like the fed failing is a mistake. comon think about it....no matter what the others say. I saw a good post on it over at http://www.forecastfortomorrow.com/news

Wed, 11/24/2010 - 22:17 | 753974 Belrev
Belrev's picture

42 million Americans on foodstamps? That is news to me. Everywhere I go I see illegal mexicans and pakistani taxi drivers flashing their foodstamp and medicaid cards. How many of those counted as "Americans" are actually legal residents?

Wed, 11/24/2010 - 22:33 | 754001 snowball777
snowball777's picture

Wow, you can tell the illegal Mexicans from the legal ones?

Nice hood; very chic.

Wed, 11/24/2010 - 23:48 | 754092 Goldilocks
Goldilocks's picture

pfft, illegal whatever ... they are human beings.

Wed, 11/24/2010 - 22:19 | 753978 William F. Dulle
William F. Dulle's picture

Population is as overstated as any other important government statistic. It's a ruse, get it? 170,000,000 in '58, but 300,000,000 now? What a joke.

Population numbers are as inflated as the dollar.

Well, maybe not. That would mean there are only 30,000,000 U.S. citizens.

My guess is that there are about 200,000,000 citizens, and population is on the decline.

Thu, 11/25/2010 - 22:07 | 755307 Rusty Shorts
Rusty Shorts's picture

Interesting, go on, please tell how you came to this conclusion?

Fri, 11/26/2010 - 23:57 | 756927 mkkby
mkkby's picture

Who cares about your opinion? Support it with facts or buzz off.

Wed, 11/24/2010 - 22:26 | 753989 BigJim
BigJim's picture

I like sound money as much as the next man.

But I think assuming this would lead the entire economy to grow at the rate postulated by Moore's 'Law' is a bit of a stretch. 

Wed, 11/24/2010 - 22:33 | 754003 snowball777
snowball777's picture

The most ignorant assumption is that an economy based on a hard gold standard would have managed to come up with computers in the first place.

 

Wed, 11/24/2010 - 23:00 | 754023 GoldSilverDoc
GoldSilverDoc's picture

There is a medical term for that type of thinking - it is called "flight of ideas" (disconnected logic), and is common in schizophrenics.

You might want to check that out.

Wed, 11/24/2010 - 23:18 | 754043 snowball777
snowball777's picture

Sure...everyone who disagrees with your chosen viewpoint is schizotypal. Uh huh.

So how would you see the billions in capital required for an ion beam lithography plant being generated in an economy with an inelastic currency?

 

Thu, 11/25/2010 - 01:23 | 754190 StychoKiller
StychoKiller's picture

Your argument makes sense only if the price of Gold is FIXED. A lot
of people are snowed by the $50 denomination on the current Gold Eagle coin
(1 Troy ounce of 24karat Gold), whereas in reality, Gold is trading at

the price of $1,380/ounce (more or less).  What if the $/Toz were $500,000/Toz?  Would your argument still be valid?

Thu, 11/25/2010 - 11:38 | 754565 snowball777
snowball777's picture

That would still be money backed by gold (soft standard), not gold as money (hard standard), which was the premise I slammed.

The "death of the dollar" implies $/Toz would no longer be a valid concept.

 

Thu, 11/25/2010 - 23:22 | 755385 RockyRacoon
RockyRacoon's picture

To become a standard comparable to the meter and the gram, gold would have to be moved from the economic/political arena to the scientific, openly and unanimously declared world-wide as THE sole true-wealth reference against which all other wealth is compared, and once and for all disconnected from economic and political influence and control of any kind, just like any other scientific standard. Only then would the relative values of currencies and monetary policies become transparent and resolve in proper perspective with each other and with goods and services.

http://fofoa.blogspot.com/

Fri, 11/26/2010 - 12:47 | 755879 snowball777
snowball777's picture

If we're going to wax scientific, then let's propose using energy itself as currency.

Like gold, it's impossible to fake, but is much more abundant and easily metered. Sure, people would be able to 'counterfeit' it with a bicycle and some coils, but we could justifiably blame anyone who was still poor for their own condition.

 

Thu, 11/25/2010 - 03:16 | 754275 traderjoe
traderjoe's picture

I don't see your supposed attachment of innovation and the quantity of money supply, or the number of zeros printed on a note. Lots of innovation and inventions occurred under the gold standard. And maybe an ion beam plant wouldn't cost "billions" but millions because there was one less zero on the end. 

We aren't on the gold standard. There's no way to discuss what could or wouldn't have been invented. That's like saying 2 million jobs were saved from the stimulus package. 

But linking innovation to the quantity or type of currency is not consistent with historical facts. 

Thu, 11/25/2010 - 11:40 | 754568 snowball777
snowball777's picture

Point out any successful culture which used or is using gold as money (no dollars, no zeroes) which accomplished anything in the absence of slave labor.

Fri, 11/26/2010 - 21:09 | 756653 chopper read
chopper read's picture

keynesian economics, at its best, succeeds in punishing the saver and investor (never allowing for falling prices) and rewards reckless borrowing and rabid consumption at the expense of conservation.

worse yet, you continue to enable the thievery with cries of,

"THEY'RE JUST NOT DOING IT RIGHT!"

After 54 years of communism in Cuba, are they "just not doing it right"?

view the expansion of outright global enslavement as keynesian debt-based monetary systems have been exported from Great Britain and the United States and gripped the globe.:

http://www.economist.com/blogs/dailychart/2010/11/government_debt?fsrc=s

who do you believe is receiving these interest payments? Why are we paying a private organization to circulate a private currency? why has this currency removed itself from any asset-backing against all presidence in relation to the past 5,000 years? 

Why do we pay interest to a private banking cartel simply so we can trade with each other? Further, our massive treasury bond market is grossly front-ran by the International Banking Cartel, including your good buddies Goldman Sachs and JP Morgan Case. How can you or anyone be apologetic on behalf of this fraud? How is this moral?

Do you have ANY IDEA what is taking place in Europe right now? Are you recognizing how Ireland is going the way of Jamaica, DR Congo, South Africa, and Turkey as it is "saved" by the IMF? Of course, this is not for free, is it? Any ideas who the IMF will "save" in the future?!!

WHY NOT introduce Kennedy's asset-backed silver certificates and Lincoln's population-linked greenbacks?

WHY NOT allow multiple means of paying Federal taxes beyond a paper note of a private corporation?! Is not our current system insane? Has this not caused major suffering since the Federal Reserve Act of 1913?!! Did we not have our very own Gilded Age prior to this debt-based monetary system which brought 8,000 tons of gold to our shores that sits in Fort Knox today?!! How do you believe that America became so prosperous?!!

 

DO YOU WISH TO KNOW WHY WE REVOLTED AGAINST THE BRITISH (ROTHSCHILD'S BANK OF ENGLAND) FROM THE START?

“Capitalism is organized crime and we are living in an usury-market economy, not a free-market economy. It is by design that the rich get richer and the poor get poorer, not by accident. ”- George Washington

"We began planning the Revolutionary War in order to issue our own money again ...and keep King George III and Bank of England from enslaving us with debt, and making Americans their financial slaves." ~ Benjamin Franklin, 1790.

YOUR KEYNESIAN APOLOGETICS ENABLE THESE LUNATICS!!!

http://www.youtube.com/watch?v=jgCDsjfGd

WAKE UP!!! we are getting PLAYED!!!!!!

Consider this excerpt from Bill Bryson's book, "At Home" (pages 233 - 235). It highlights the period in America where there was no income tax or other major 'redistribution of wealth', and there was no centralized (communist) policy for money planning allowing for a private monopoly on 'legal tender', but rather both competing and single asset-backed currencies at various times in various regions.

Ideas and wealth were pouring into America with this more favorable business environment. The "gap" between the wealthiest people and the poorest was, of course, boundless, but the additional wealth creation came in from overseas via massive exporting, and, in addition to the entrepreneurial "rich" creating manufacturing jobs, they threw parties and built homes that created jobs, and they funded universities and hospitals to secure their legacies (as the mega-rich very often do). They also brought art and worldly treasures to our shores that sit in our museums today.

Importantly at this time, ambitious immigrant workers were certainly no less "exploited" than anywhere else in the world and, unlike the restrictive class barriers and lack of upward mobility in Europe, new and existing Americans were becoming millionaires by the tens of thousands.

This growth was not agrarian via slavery (this ended in 1865) or cotton, but rather industrial via steel and ingenuity and, most importantly, via the power of property rights (including virtually no taxes, i.e. "right to your own wealth") and free markets. This unprecedented growth happened decades before "the roaring 20's" of easy credit created by the private Federal Reserve Bank.

Read for yourself:

"The Eiffel Tower was the most striking and imaginative large structure in the world in the nineteenth century, and perhaps the greatest structural achievement too, but it wasn't the most expensive building of its century or even of its year. At the very moment that the Eiffel Tower was rising in Paris, two thousand miles away in the foothills of the Appalachian Mountains in North Carolina an even more expensive structure was going up - a private residence on rather a grand scale. It would take more than twice as long to complete as the Eiffel Tower, employ four times as many workers, cost three times as much to build, and was intended to be lived in for just a few months a year by one man and his mother. Called Biltmore, it was (and remains) the largest private house ever built in North America. Nothing can say more about the shifting economics of the late nineteenth century than that the residents of the New World were now building houses greater than the greatest monuments of the Old. 

America in 1889 was in the sumptuous midst of the period of hyper-self-indulgence known as the Gilded Age. There would never be another time to equal it. Between 1850 and 1900 every measure of wealth, productivity and well-being skyrocketed in America. the country's population in the period tripled, but its wealth increased by a factor of thirteen. Steel production went from 13,000 tons a year to 11.3 million. Exports of metal products of all kinds - guns, rails, pipes, boilers, and machinery of every description - went from $6 million to $120 million.

The number of millionaires, fewer than twenty in 1850, rose to forty thousand by century's end. Europeans viewed America's industrial ambitions with amusement, then consternation and finally alarm. In Britain, a National Efficiency Movement arose with the idea of recapturing the bulldog spirit that had formerly made Britain pre-eminent. Books with titles like The American Invaders and The 'American Commercial Invasion' of Europe sold briskly. But actually what Europeans were seeing was only the beginning. 

By the early twentieth century America was producing more steel than Germany and Britain combined - a circumstance that would have seemed inconceivable half a century before. What particularly galled the Europeans was that nearly all the technological advances in steel production were made in Europe, but it was America that made the steel. In 1901, J.P. Morgan absorbed and amalgamated a host of smaller companies into the mighty US Steel Corporation, the largest business enterprise in the world had ever seen. With a value of $1.4 billion it was worth more than all the land in the United States west of the Mississippi and twice the size of the US federal government if measured by annual revenue. 

America's industrial success produced a roll call of financial magnificence: Rockefellers, Morgan’s, Astor’s, Melons, Morgan’s, Frocks, Carnegies, Gould’s, du Pont’s, Belmont’s, Harriman’s, Huntington’s, Vanderbilt’s and many more basked in the dynastic wealth of essentially in exhaustible proportions. John D. Rockefeller made $1 billion a year, measured in today's money, and paid no income tax. No one did, for income tax did not yet exist in America. Congress tried to introduce an income tax of 2 per cent on earnings over $4,000 in 1894, but the Supreme Court ruled it unconstitutional. Income tax wouldn't become a regular part of American life until 1914, and in the meantime any money that was made was kept. People would never be this rich again."

http://www.zerohedge.com/forum/how-do-we-arrive-eve-our-collapse-0

 

Thu, 11/25/2010 - 10:19 | 754497 Temporalist
Temporalist's picture

How did civilization ever come about without FRNs?!?!

Thu, 11/25/2010 - 11:40 | 754569 snowball777
snowball777's picture

Slave labor and mercantilism.

Wed, 11/24/2010 - 22:33 | 754002 William F. Dulle
William F. Dulle's picture

What use is it to rail against Keynes? From what I have read, he was tolerant of alternative viewpoints. It might be that he would have taken a different stand in today's economic conditions. And who gives a shit? If he was the voice of reason, nobody in today's political establishment would listen to him. That's the operative factor, I think.

"Key Largo" is today's America in microcosm. If you haven't seen it, see it. If you have seen it, see it again. The only problem is that heretofore there is no Humphrey Bogart to lead us out of this mess.

Wed, 11/24/2010 - 22:45 | 754015 nmewn
nmewn's picture

"What use is it to rail against Keynes? From what I have read, he was tolerant of alternative viewpoints."

Well I guess it all depends on whose alternative viewpoints he was tolerant of.

You be the judge.

"The theory of aggregated production, which is the point of the following book, nevertheless can be much easier adapted to the conditions of a totalitarian state [eines totalen Staates] than the theory of production and distribution of a given production put forth under conditions of free competition and a large degree of laissez-faire."

http://tmh.floonet.net/articles/foregt.html

Wed, 11/24/2010 - 23:06 | 754030 snowball777
snowball777's picture

From 'The General Theory of Employment, Interest and Money', Chapter 24:

"But, above all, individualism, if it can be purged of its defects and its abuses, is the best safeguard of personal liberty in the sense that, compared with any other system, it greatly widens the field for the exercise of personal choice. It is also the best safeguard of the variety of life, which emerges precisely from this extended field of personal choice, and the loss of which is the greatest of all the losses of the homogeneous or totalitarian state. For this variety preserves the traditions which embody the most secure and successful choices of former generations; it colours the present with the diversification of its fancy; and, being the handmaid of experiment as well as of tradition and of fancy, it is the most powerful instrument to better the future."

You really ought to read the book yourself, Mewn, instead of regurgitating the expurgated nonsense of others.

Wed, 11/24/2010 - 23:20 | 754046 nmewn
nmewn's picture

And you really ought to proof read what you throw up in Keynes defense.

"if it can be purged of its defects and its abuses"

That's quite the qualifier there eh snowball?

This is exactly the issue I stated above that you no doubt junked...elitist, eugenic, control freakish bullshit.

Will you or someone else be deciding what is defective & abusive? Perhaps a committee should be convened? Comprised of whom? Maybe a politburo to ease contentious debate would be better? 

Wed, 11/24/2010 - 23:24 | 754055 snowball777
snowball777's picture

Anarchy or nothing? That's quite the childish "excluded middle".

Is Lloyd's 'individualism' an abuse?

Or should we shy away from judgement for fear of being labelled as eugenicists?

Wed, 11/24/2010 - 23:49 | 754094 nmewn
nmewn's picture

"Or should we shy away from judgement for fear of being labelled as eugenicists?"

As long as your judgement is...I can do with my life & my funds as I please you can expect to be treated the same by me.

When you start advocating/passing laws saying I must live or look or eat or drink or say or associate or read or smoke or spend or travel a certain way for the benefit of all society...you risk being labeled a eugenicist or statist.

The above has nothing in common with being an individualist...it has everything in common with state control.

It comes with the territory you map out for yourself snowball...I selected my path a long time ago ;-)

Thu, 11/25/2010 - 00:00 | 754108 snowball777
snowball777's picture

And if "what you please" is to rape small children, for example?

I think we both place the same value on freedom, but "the tip of our noses" brings extra complications that are not easily solved by individuals. There is a balance to be struck between the ideals of personal freedom and what might be characterized as the freedom from other people's freedom adversely affecting you.

Thu, 11/25/2010 - 00:10 | 754115 nmewn
nmewn's picture

Now your just being ridiculous.

Both of my kids would kill anyone who tried that...anything left over for me would be ground up and fed to my dogs.

Cost efficiencies are all around and easily found ;-)

SeeYa

 

Thu, 11/25/2010 - 07:50 | 754405 BigJim
BigJim's picture

The 'what you please' also applies to the preferences of small children - ie, raping small children violates their rights, and thus is clearly not what mmewn was advocating.

Thu, 11/25/2010 - 08:41 | 754440 Peace is the x-axis
Thu, 11/25/2010 - 09:25 | 754467 nmewn
nmewn's picture

"The 'what you please' also applies to the preferences of small children - ie, raping small children violates their rights, and thus is clearly not what nmewn was advocating."

Precisely.

It's exactly why I called it ridiculous.

Whenever you find yourself engaged in a debate with a socialist/statist you can be assured of several things.

Two of which are, no matter how many strawmen you burn down in front of their eyes they will erect still another without commenting on the why the last one they made was so shoddily constructed and is in ashes...and at some point, usually toward the end, a plea to emotion will be made involving children. 

The first act of loving parents is to protect them. Depending on the individual child's intelligence, maturity & development they are then taught to protect themselves. 

By the parents. 

Ran across this in my "browsing" this morning before the feast...LOL.

"Long before the failure of modern socialism, the earliest European settlers gave us a dramatic demonstration of the fatal flaws of collectivism. Unfortunately, few Americans today know it.

The Pilgrims at Plymouth Colony organized their farm economy along communal lines. The goal was to share the work and produce equally.

That's why they nearly all starved."

http://www.realclearpolitics.com/articles/2010/11/24/happy_starvation_day_108049.html

Happy Thanksgiving to all!

Thu, 11/25/2010 - 11:47 | 754581 snowball777
snowball777's picture

Whenever you find yourself engaged in a debate with a conservative (for lack of a better label to toss around) you can be assured that they will oversimplify all arguments into an "every man for himself" meme despite the rather obvious impossibility of any society based upon this foundation.

One might note that we're still here. And the reason?

The 'socialism' of the Native Americans (who had survived just fine for centuries using exactly that sharing model until they were wiped out by conservative, imperialist Christians).


Thu, 11/25/2010 - 13:26 | 754746 Husk-Erzulie
Husk-Erzulie's picture

The 'socialism' of the Native Americans

Was a socialism of individual choice, not a statist, imposed, socialism.  Two very different things.  The free individual/ tribal socialism  model was wiped out by statist, imperialist christians.

Thu, 11/25/2010 - 14:18 | 754820 snowball777
snowball777's picture

Nice try. The Wampanoag helped the Plymouth settlers as a tribe, not isolated individuals.

 

Thu, 11/25/2010 - 20:48 | 755246 nmewn
nmewn's picture

Hmmm.

I wonder...did the "tribe" actually vote on this action or did the chief just pull a Jean Luc Picard and say make it so you little triblings? ;-)

Thu, 11/25/2010 - 22:02 | 755302 snowball777
snowball777's picture

"The Wampanoag were organized into a confederation, where a head sachem, or political leader, presided over a number of other sachems. The English often referred to the sachem as “king,” a title that misled more than it clarified since the position of a sachem differed in many ways from that of a king. Sachems were bound to consult not only their own councilors within their tribe but also any of the “petty sachems,” or people of influence, in the region."

Not exactly a bicameral legislature, but not exactly tyranny either. 

Fri, 11/26/2010 - 06:16 | 755601 nmewn
nmewn's picture

Well snowball ya got me on the injuns.

I readily admit that socialism, as it was practiced by the Indians of North America, was pretty benign. However, my point has always been, when you start imposing socialism on larger & expanding populations it morphs into something else...communism or fascism. All material value flows toward the top. All edicts & law flow in the other direction.

Just as William Bradford observed collectivism (socialism/communism) will not "work" unless compelled to...pun intended ;-)

He chose a different compulsion/motive after a disastrous "collectivist harvest"...he chose to allow profit of their own labor which led to a bountiful harvest instead of the soul crushing bane of collectivism.   

Rummaging still deeper toward the back of the fridge for leftover Thanksgiving fare...it has just come to my attention that what we were taught in government schools is false (or at least misleading) that is, that the purchase of Manhattan Island was a fraudulent sale perpetrated by the natives on the Dutch...those sly dog savages...before you go into a snit (on the word "savages") I have Creek blood coursing through my veins...anyways...

The tribal chief/elders of one tribe misrepresented their ownership of another tribes land in the deal and swindled the "white man" out of valuable goods by claiming false title...on first blush I assumed it to be the Goldman Sach's or Citigroup tribe native to the area...LOL...but on further research it appears to be the Canarsies.

Fri, 11/26/2010 - 13:15 | 755927 snowball777
snowball777's picture

Maybe it's something in the Manhattan water supply; at least the 'savages' didn't package it into securities and use OPM.

In my world view, capitalism and socialism are toolsets that are variously useful in different contexts. Deciding who gets to live by the ocean? Markets, baby. Fire services for a town? Collectivism makes much more sense (why should your house burn down because your neighbor neglected to pay his fire company?). Attempting to use either to solve every problem is as useful as always using a hammer or always using a screwdriver regardless of the task at hand.

The 'material value' (also 'power') up, edicts down phenomenon is true of any hierarchical system of government, IMHO.

http://www.youtube.com/watch?v=xTPVm8gv8fM

Fri, 11/26/2010 - 19:28 | 756502 nmewn
nmewn's picture

"Deciding who gets to live by the ocean? Markets, baby. Fire services for a town? Collectivism makes much more sense (why should your house burn down because your neighbor neglected to pay his fire company?)."

In a socialist society I can foresee the day when you will not be allowed to live by the ocean...made impossible to common people by high property taxes and burdensome regulation...it's happening in Fla. now...that is not "market forces". 

By the way...my town has a volunteer fire department...perhaps could be termed "collectivist" but no taxes are levied on any neighbor for it ;-)

Fri, 11/26/2010 - 21:44 | 756708 chopper read
chopper read's picture

+1

Fri, 11/26/2010 - 23:14 | 756831 snowball777
snowball777's picture

Show me the regulation that says one person can buy a beachfront property while another cannot.

And has your town burned down? No.

So....collectivism works (when you use it on the right problems).

Sat, 11/27/2010 - 09:15 | 757226 nmewn
nmewn's picture

Throughout this entire thread you have;

Defended statism as somehow virtuous, virtue now being defined as what I may or may not do with my property.

Defended Keynes' discredited theory as mathematically plausible even though it takes human action in the form of tyranny (monetary or rights usurpation) to allow it to be viable.

Defended socialism as a government object instead of a familial object where it properly belongs.

Defended collectivism, not of working together toward a common goal by individual choice, but enforced at the point of a gun.

"Show me the regulation that says one person can buy a beachfront property while another cannot."

Another strawman argument...that is not what I said...this is what I said;

"In a socialist society I can foresee the day when you will not be allowed to live by the ocean...made impossible to common people by high property taxes and burdensome regulation...it's happening in Fla. now...that is not "market forces"." 

I said common people...and I did take note you dropped any argument of taxation in favor of a labyrinthine trip through governmental archives in search of the offending regulation...LOL.  

It has a cumulative affect snowball.

I realize it would be hard for someone such as yourself to ever stop and look at the reams of dead tree's bound together and stacked in warehouses that make up all regulatory codes but I can assure you there are many bureaucrats who are paid good money to pump them out daily, weekly, yearly. 

I'll leave you and this thread with a true story of a good friend of mine...who just happens to be a liberal...not a progressive. No names of course.

He lives on Maderia Beach and when his parents passed away they left him title to the family beach house...built in the early 1950's if I recall.

Time goes by and the inevitable development comes to his doorstep (more properly his side window) as developers want his property for condo's. A handsome offer is made (without solicitation) and he could have retired somwhere else quite well off at a very early age but he declines, saying it's not for sale and never will be for sale.

The next day code enforcement is standing on his doorstep...you can be the judge as to the coincidence of timing. This was a miniature Kelo vs. New London long before they became so brazenly gluttonous for tax revenue that something made it to the Supreme Court.

What the bureaucrats & developers had not factored in was his tenacity. And I should also mention a large trust left to him.

The battle was fought over many years but finally a massive condo was indeed built but commercial road frontage property had to be purchased by the developer for their parking lot.

The little beach house could not have been held on to by a common man snowball, but my friend (in spite of his peculiar political views) is most definitely not common...LOL.

The little beach house is still there to this day and whenever I visit I always make sure to save enough urine up when I leave...it has become my habit to leave a little something for the condo dwellers on the way out ;-)

SeeYa

 

Sat, 11/27/2010 - 09:28 | 757236 snowball777
snowball777's picture

That was a great deal of verbage which could've been summed up with 'eminent domain'.

Sat, 11/27/2010 - 10:18 | 757258 nmewn
nmewn's picture

Imminent domain is for the betterment or better general welfare of the public...which I also believe strongly is wrong as some things can have no price fixed upon them (the seller may not want to sell for any price)...in this example (my friend) there was a developer (private entity) working in concert with government (public entity) to rook someone (an individual) out of their property by using regulation as a weapon.

It is/was crony capitalism.

The city didn't want valuable (from a taxation standpoint) road frontage commercial property used for a parking lot and the developer didn't want to pay the extra (higher purchase cost) of the commercial property.

So they came after the individual...my friend & his residential property.

They lost. The individual won.

I'm sure this distresses you to no end...as a statist...which is why I shared it with you...you can thank me with a junk ;-)

SeeYa

Wed, 11/24/2010 - 23:16 | 754038 CrackSmokeRepublican
CrackSmokeRepublican's picture
American Keynesianism by Jewish Talmudics in the 1930s http://theinfounderground.com/forum/viewtopic.php?p=50240

I have little doubt that Keynes shared the anti-Semitic attitude of his upper middleclass English milieu as well as that turn-of-the-century (and later!) Cambridge. . . but what should we do with the kind of expressions `Jew boy . . . [who] has had his bottom many times kicked, and expects it' and similar ones in his unpublished piece on Einstein (JMK12, pages 382-84)? That's anti-Semitism of the gutter. On the other hand, there were his close relations with Richard Kahn and the warmth of his two concluding paragraphs in his essay on Melchior. . . . I certainly have no thought of starting a 'was Keynes anti-Semitic' debate.
Skidelsky (2003) readdressed these matters when he revised his three volume work to produce a one volume abridged version of the biography. In many ways a stronger narrative emerged as the later materials could be woven into the earlier chapters. In that new volume, Skidelsky addressed the anti-Semitism issue via examination of Keynes's essay ?Economic Possibilities for Our Grandchildren? which essay had contained Keynes's remark about Jews and the principle of compound interest. Skidelsky wrote:
[There] are a few other references to Jews in Keynes's writings which would now be construed as anti-semitic. In A Short View of Russia he had doubted whether communism 'makes Jews less avaricious'. After a visit to Berlin in June 1926, he depicted Germany as under the 'ugly thumbs' of its 'impure Jews', who had 'sublimated immortality into compound interest'. This was for a talk to The Memoir Club, published only posthumously; it was his most prejudiced utterance on the subject, but it falls a long way short of the murderously flip remakes which even someone like Dennis Robertson was capable of making.11 (373-374)

Skidelsky went on to say that
[Such] stereotyping of Jews was common in Keynes's circle, and the stereotypes were usually unfavourable. Keynes's letters are mercifully free from personal abuse – not so Lydia's, or those of some Bloomsberries. Individual Jews were exempted by the devices of exceptionalism or non-recognition of their Jewishness. Thus was decency reconciled to prejudice. But the occasion for decency did not often arise. Although Virginia Woolf married a Jew12, and Sraffa and Wittgenstein were half-Jewish13, there were very few Jews in Keynes's world in the 1920s…meanwhile, stereotyping could flourish, and there was no need to mind manners…Keynes's own stereotyping took place on the philosophical, not vulgar, plane. (374)

 

(HERE'S THE IDIOT JEW TALMUDIC PUNCHLINE FOR THE GOYIM) -- Laugh like Bernanke -- CSR

Skidelsky characterized Keynes's views as grounded in the idea that Jews embodied the spirit of capitalism, which was associated with an abstract love of money. He argued that Keynes distinguished between pure or religious or intellectual Jews and money loving Jews. In this discussion Skidelsky noted a letter of complaint to Keynes by University of California Professor Max Raden about the Economic Possibilities essay, where Raden had told Keynes that not only was immortality unimportant theologically for Jews, but that Jews were not especially concerned with the accumulation of money. In his reply to Raden Keynes apologized for having been thinking along 'purely conventional lines' (ibid.). But he was reluctant to give up his fancy: 'I still think that the race has shown itself, not merely for accidental reasons, more than normally interested in the accumulation of usury.' (Like... "F'N Jews"...under Rothschild-Schiff-Warburg control in the 1930s??? Remember that Keynes had served in India and had seen Jewish Manipulation of the fledgling Bombay Stock Market...CSR ) This correspondence took place in the autumn of 1933.? (374) Skidelsky concluded this discussion by remarking ?Keynes anti-Semitism, if such it was, was little more than a theological fancy: expression, perhaps, of some unresolved conflict about his own Non-Conformist roots. There is no evidence that it influenced his personal conduct.? (374-375)

Wed, 11/24/2010 - 23:23 | 754051 arkady
arkady's picture

Gee, that is a nice site there - what's next, you are going to start posting sections of Mein Kampf?

Wed, 11/24/2010 - 23:27 | 754060 CrackSmokeRepublican
CrackSmokeRepublican's picture

No I'd rather flame idiots like yourself...

Thu, 11/25/2010 - 00:19 | 754127 arkady
arkady's picture

I am an idiot because I pointed out that you are copying and pasting from hate sites?  Solid logic.   Why is that financial burdens always brings out the anti-semites and why is ZH filled with jew bashers?  Running out of other ideas?

Thu, 11/25/2010 - 07:57 | 754406 BigJim
BigJim's picture

What's your point? That Keynes displayed the typical mild anti-Semitism of his time, place and class? I don't see what that's got to do with the article - please explain.

Wed, 11/24/2010 - 23:26 | 754057 CrackSmokeRepublican
CrackSmokeRepublican's picture

 

A lot more than most Lame-assed-Idiot-Jews on Z.H. have ever done...--CSR

---------------

Keynes and India, 1909-1913: a study on foreign investment policy

Carlo Cristiano
Abstract

Keynes's work on India before the First World War concentrated on analysis of the gold exchange standard and the stabilization of the rupee external value. Indian monetary arrangements were framed into a plan for foreign investment, implemented by the India Office in London. This policy, which was a typical example of public control over investments, occasioned Keynes's first job as an applied economist. Although neglected by Keynesian scholarship, this learning by doing experience is likely to have played a significant role in the young economist's training and education.

 

http://www.informaworld.com/openurl?genre=article&doi=10.1080/0967256090...

Wed, 11/24/2010 - 22:37 | 754007 arkady
arkady's picture

Ent-irely possible.

Wed, 11/24/2010 - 22:59 | 754022 Atomizer
Atomizer's picture

Tyler, we see what is happening oversea's. US will not accept austerity without a fight.

History repeats.

While the American history books tell us the Germans were entirely to blame for World War II, further study shows that the Nazi party was created as a response to what happened when the Soviets killed 10 million Christians in the Ukraine, in the late 1920s and early 1930s. The American media doesn't tell us this, they try to incorrectly blame Germany for everything

http://www.youtube.com/watch?v=TELIMHvaB5g

 

Wed, 11/24/2010 - 23:10 | 754037 RobotTrader
RobotTrader's picture

Gary Kaltbaum discusses the big movers today.

Market wrap is 18 minutes into the podcast, then more at 32 minutes.

http://archives.warpradio.com/btr/InvestorsEdge/112418.mp3

One example of a stock he discusses:

 

Wed, 11/24/2010 - 23:25 | 754056 Atomizer
Atomizer's picture

RobotTrader. I follow you on another site. You offer great info. However, some of us were lucky before Lehman Brothers collapse.

Lets hope you don't take a cruise anytime soon. Your Government is now controlling the Internet. Have a look in the past.

Wall Street Crash / RMS Berengaria

http://www.youtube.com/watch?v=7pYaG0qfP2o

Wed, 11/24/2010 - 23:22 | 754050 Bob
Bob's picture

I just love this radical vision of love, peace and understanding.  Does anybody see an underlying problem with sharing gains, regardless of the monetary system?

Wed, 11/24/2010 - 23:26 | 754061 Goldilocks
Goldilocks's picture

... the economists.

Wed, 11/24/2010 - 23:37 | 754073 Bob
Bob's picture

When such progress inevitably makes human labor practically obsolete, are the "capital holders" really gonna want to support their "undeserving" asses? 

We all know how this tune goes.

Thu, 11/25/2010 - 01:51 | 754217 Dr. Acula
Dr. Acula's picture

>human labor practically obsolete

You fail to take into account Ricardo's Law of Comparative Advantage.

Even if computers/robots have absolute advantage - i.e. are superior at every task like creating music and poetry and paintings and doing interior decorating and giving massages and DJ'ing and serving mixed drinks, human beings will still have value.

And computers/robots will NEVER have absolute advantage for those who prefer dealing with real human beings and not with computers.

People have feared progress since time immemorial. It is an ancient economic fallacy. Let's smash all our machines and tie all our hands behinds our back. Then there will be almost unlimited work for everyone. Instead of people flying in airplanes, we'll push people and cargo around thousands of miles via handcarts. Imagine the utopia we'll usher into existence.

 

Thu, 11/25/2010 - 08:00 | 754412 BigJim
BigJim's picture

Yes, I sometimes wonder why people claiming that technology is making human labour redundant, don't advocate banning the wheel.

Thu, 11/25/2010 - 09:31 | 754471 Bob
Bob's picture

Have you read Vonnegut's Player Piano?  Not his best work, but his vision of a mechanized world seems to have been prophetic.  Do you know how many jobs have been eliminated by robotic manufacturing? It only increases from here.  Much of the outsourcing we rue has been simply the result of amazingly cheap labor in third world countries that required relatively little hard capex.  Catch a few shows on robotic manufacturing on the History Channel and you'll see what it's about. 

I don't see a world of abundance and charmed leisure for the common man here in a service economy.  We've already seen how that goes. 

This wonderful vision of a future of plenty is great . . . until you see how the bounty is divided.  Even the notion of "dividing" the products is intensely inflamatory to Americans--particularly the "haves."  You can read it here at ZH day in and day out.  Really, its a "socialist" vision and we all know how that plays. 

Thu, 11/25/2010 - 16:10 | 755001 Dr. Acula
Dr. Acula's picture

"Do you know how many jobs have been eliminated by robotic manufacturing?"

Only those ignorant of economic science cling to ancient fallacies. Have you read Economics in One Lesson by Hazlitt? Here, I've given you a free link: http://www.hacer.org/pdf/Hazlitt00.pdf

Millions of people are employed in building and designing the robots and electronics. Improved technology allows people to do bigger and better things. If you'd prefer being a Luddite, no one's stopping you.

 

Thu, 11/25/2010 - 17:30 | 755101 snowball777
snowball777's picture

And an order of magnitude more workers have been displaced by their efforts. A good, in terms of progress, but cold comfort for the lathe operators of yesteryear. What company would switch to automated manufacturing if it required more workers?

Perhaps this reduces prices enough to increase the market cap of an industry (as in the exampes from Hazlitt's "Curse of Machinery") to the betterment of many, but that isn't a guaranteed outcome. Sometimes, improved technology only enables the same things to be done with better margins, plebes be damned.

 

Thu, 11/25/2010 - 18:12 | 755142 Dr. Acula
Dr. Acula's picture

"but that isn't a guaranteed outcome"

Congratulations, you pointed out something utterly trivial: progress can "destroy" jobs, temporarily. I'm not sure what you are suggesting - perhaps that we should ban the manufacturing of cars on behalf of the buggy whip manufacturers.

There is still no theoretical basis for believing that new jobs can't be created. In fact, it is the opposite that is true. Your own career as a software developer would be inconceivable 100 years ago and your job is possible thanks to previous progress. And if a machine is made that automatically writes flawless software according to the dictates of a designer, thus destroying your job, then you can always write books on pseudoeconomics or something.

From Human Action by Ludwig von Mises:


"The substitution of more efficient methods of production for less efficient ones does not render labor abundant, provided there are still material factors available whose utilization can increase human well-being. On the contrary, it increases output and thereby the quantity of consumers’ goods. “Labor-saving” devices increase supply. They do not bring about “technological unemployment.”"

 

Thu, 11/25/2010 - 22:20 | 755318 snowball777
snowball777's picture

I believe I stated that it was a 'good', I'm sorry if that was somehow too ambiguous for your comprehension.

I'm sure Babbage could conceive of computing devices and the need for software to control them almost 200 years ago. Anyone who has spent time attempting to accomplish all but the most trivial of tasks with a computer knows that software to flawlessly write software is on par with sentient AI with respect to difficulty. It was not by accident that I chose a profession unlikely to be obsoleted in my lifetime; it also happens to be something I'm predisposed to do and enjoy.

As for writing about pseudo-econ, why not? It worked for Mises and Rothbard. The "assume an eternal supply" (of material inputs) fallacy is little beyond a clever form of "let them eat cake".

Fri, 11/26/2010 - 15:00 | 755981 Bob
Bob's picture

I have no criticsm of robots--they do exactly what they're meant to do. I see nothing wrong with that in any way.  They're nothing but admirable, imo.

You would seem to be saying that robotics has eliminated zero jobs (net) because of all the industrious elves those robots in turn require . . . that if people are no longer working on product production lines, they're now equally employed either in the robotic machinery industry or some "higher" pursuit. 

Two suggestions come to mind: Consider the purpose of robotics (eliminating human workers in this context.)  And then check your math.  

Alternatively, you might look at the real world around you . . . most of those "liberated" from actual labor have not been meaningfully repurposed.  I'm hard-pressed to think of any group in society that is not aware of this, although many mistakenly point to China or idleness itself as the cause (missing forest for trees at best.)  I don't know any Luddites, however, so I cannot speak for them.  The Artists are as unemployed as ever. 

I definitely missed that education of Econ in One Lesson.  To think of all the time I could have spent not in Econ class en route to that undergrad degree--but then I would have had to go with an alternative major that would have taken way more time and effort (even if I hadn't taken so many of those courses in the grad school), so whatcha gonna do?  For better or worse, what's done is done.

But your comments read like something out of a breathlessly visionary "Futurist" book from the mid-1970's, Doc.   

Hey, I like the idea!  Very much.  It just hasn't worked out that way.  And it doesn't look like that's gonna change. 

Which brings us back to my original comment upon the core issue of sharing in this post-industrial economy.  Sadly, it seems to me that even famed cynic Kurt Vonnegut over-estimated collective goodwill :

http://en.wikipedia.org/wiki/Player_Piano

 

 

Thu, 11/25/2010 - 09:37 | 754474 Bob
Bob's picture

Ricardo's "Law" is a great idea, but the reality of human nature has tested it pretty harshly.  Look around at post-industrial America. 

Of course, human nature is arguable.  But what it means in America is not . . . unless you wanna channel Marx's dreams. 

Thu, 11/25/2010 - 16:11 | 754990 Dr. Acula
Dr. Acula's picture

>Ricardo's "Law" is a great idea

It's also a law.

>but the reality of human nature has tested it pretty harshly.  Look around at post-industrial America. 

Most theorems in economic science are qualified "ceteris paribus". Meaning, you can't depend on Ricardo's Law to make you rich when you print trillions of dollars for corporate welfare and commit unjustified invasions of other countries and errect military bases all over the world.

Thu, 11/25/2010 - 01:58 | 754222 Dr. Acula
Dr. Acula's picture

>Does anybody see an underlying problem with sharing gains

Human nature.

The Zeitgeist / Venus project activists talk about abundance but never talk about how they'll have to raise an army of thugs to beat people into submission and prevent subjective appraisals and voluntary exchanges, i.e. the market price system. They can never explain how they'll suppress the spontaneous emergence of a most-marketable commodity, i.e. money.

 

Thu, 11/25/2010 - 07:59 | 754409 BigJim
BigJim's picture

++

Wed, 11/24/2010 - 23:24 | 754052 Goldilocks
Goldilocks's picture

Thank you very much Tyler, interesting read.

Step aside "homo economicus" ... make way for "homo abundus".

... let's get this party started quickly, let's get this party started right.

Wed, 11/24/2010 - 23:24 | 754053 Ted K
Ted K's picture

Instead of everyone wanting to be the next Taleb or Einstein of finance, how about just giving us a accurate 6 month prediction on inflation?? 'Cus you can't even do that.  Much easier to "wax on" pathetic.  So impressed.    Cocksuckers. And by the way monetary policy is not Keynesianism, fiscal policy spending is Keynesianism.  Let us know when you have that simple definition figured out Radical Boywonder.

Wed, 11/24/2010 - 23:50 | 754095 snowball777
snowball777's picture

Easy, unabombastic.

Do some harmonic equations to calm yourself and try to get out of the shack now and then.

Thu, 11/25/2010 - 04:43 | 754317 Ted K
Ted K's picture

suck it.

Thu, 11/25/2010 - 11:48 | 754584 snowball777
snowball777's picture

Suck what? Oh....you poor, poor man...better get that looked at.

Thu, 11/25/2010 - 00:11 | 754116 Caviar Emptor
Caviar Emptor's picture

I know that it's ZH-orthodoxy to bash Keynes, and I share the zeal on most points. 

But what we see in the US economy today is the result of Chicago School Monetarism (Milton Friedman and his spawn including Volcker, Greenspan and Bernanke) grafted onto Keynesianism. 

Richard Nixon, an absolutely key figure in forming the economics of today, was the first US president to embrace monetarist concepts after a long line of post-FDR presidents who were clear Keynesians (culminating in the JFK/LBJ great society programs of the 1960s). 

Nixon irrevocably killed the gold standard and devalued the dollar inciting the first wave of inflation of the 1970s. Nixon terminated Bretton Woods (Keynes' baby). Nixon started Chimerica. And Nixon pushed policies that Friedman directly recommended at the time, including turning Chile into a capitalist state (through a CIA coup) and extending giant farm subsidies, telling farmers to "get big or get out", which started the first major supply-side experiment in the US. 

We live in the shadow of these critical decisions and policies. They shaped today's economy.

Taking the dollar off the gold standard marked the coming of the "printing gone wild" era which we live in now. Nixon's dollar devaluation and floating exchange rates initiated the 'great inflation' of the 1970s. Opening up trade with China has created Chimerica, the trading arrangement which dealt the death blow to America's industrial and manufacturing might. Farm subsidies and overproduction of corn lead directly to the ethanol program and production of high fructose corn syrup.

Every successful macroeconomic philosophy fails over time because the world evolves because of and in spite of the implemented policies. The policies inspired by Milton Friedman and the 'supply-siders' are failing now because they too have run their course and are creating aberrations. 

 

Thu, 11/25/2010 - 01:01 | 754165 Dr. Acula
Dr. Acula's picture

"Every successful macroeconomic philosophy fails over time because the world evolves because of and in spite of the implemented policies"

Some do not fail: the apodictically true theorems - derived from a priori and/or empirically true axioms; viz. Austrian economics.

 

Thu, 11/25/2010 - 01:23 | 754191 snowball777
snowball777's picture

A farmer, an engineer, and a mathematician are each given 100 yards of fencing and told they can have whatever land they can enclose with it.

The farmer creates a 25x25 pen and proceeds to till.

The engineer creates a circular enclosure to maximize the area within.

The mathematician wraps himself in the fence and declares himself to be outside the fence.

Guess which one of these guys is most like an Austrian economist...

Thu, 11/25/2010 - 02:04 | 754212 Dr. Acula
Dr. Acula's picture

Do you hate all sciences? Or is it math and economics you disdain?

IIRC you are involved with Blizzard but I'm guessing you aren't a software developer. Software developers can envision complex systems and understand how changes affect their behavior. They can more easily see how policies can affect economies and societies, and how government intervention and socialism/fascism (modern "liberalism") destroy the fabric of civilization.

"A man who chooses between drinking a glass of milk and a glass of a solution of potassium cyanide does not choose between two beverages; he chooses between life and death. A society that chooses between capitalism and socialism does not choose between two social systems; it chooses between social cooperation and the disintegration of society. Socialism is not an alternative to capitalism; it is an alternative to any system under which men can live as human beings." - Ludwig von Mises

 

Thu, 11/25/2010 - 02:24 | 754246 snowball777
snowball777's picture

I love science, but we're talking about Austrian economics.

And, yes, I am a software engineer and worked at Blizzard between '98 and '05 before moving on to development for the PS3.

But do carry on with your sophistry worship. It's quite amusing.

Thu, 11/25/2010 - 08:27 | 754429 Dr. Acula
Dr. Acula's picture

>I love science, but we're talking about Austrian economics.

I see. Are you saying AE is false? Which parts are false exactly?

>yes, I am a software engineer

Then AE should be easy to soak up for your kind of mind. But if you want to wallow in ignorance, I guess that's a valid choice, too.

 

Thu, 11/25/2010 - 11:56 | 754596 snowball777
snowball777's picture

Yes, AE is based on invalid axioms and faulty logic.

For example, "humans take conscious actions towards goals". Bristol Palin?

Anyone who bases their belief system of axioms that can't be questioned or validated and states that there is no way to check their hypotheses may as well be writing angst poetry.

Thu, 11/25/2010 - 15:12 | 754911 Dr. Acula
Dr. Acula's picture

>Yes, AE is based on invalid axioms and faulty logic. For example, "humans take conscious actions towards goals".

Yes, but which part is invalid? That there are humans, or that they take conscious actions, or they their concious actions are goal-directed? Note that humans in a vegetative state aren't considered economic actors.

I'll agree the axiom wouldn't be true if the universe were devoid of human beings. Say, like the universe 1 billion years ago. If you want to study economics in that cosmic era, then go for it.

>Bristol Palin?

No one said that consciously acting humans are smart or "rational" (in the colloquial sense of the term) or think with foresight. But they are rational. Even Jeffrey Dahmer can be said to behave rationally, if it's freezing victim's bodies that brings one pleasure.

>axioms that can't be questioned

The axiom you gave as an example can be questioned, but of course in doing so you are seeking the goal of disproving it, thus simply reinforcing that axiom.

Other axioms are empirical (such as "humans value leisure") and can be accepted or rejected at your pleasure. You can also choose axioms that result in 1+1=3 if its something you enjoy.

>[Anyone who] states that there is no way to check their hypotheses may as well be writing angst poetry.

Are you some kind of positivist? Perhaps you believe only ideas that can be checked experimentally result in valid knowledge. Of course, that's a metaphysical dogma itself that can't possibly be checked in the laboratory. Hence it's self-contradicting and therefore false.

Perhaps you believe the human mind has no role in determining what knowledge is, but rather that the brain is merely a lump of matter and an element of natural science? If so, then ideas produced in the brain can not be true or false ideas any more than gall produced in the liver can be true or false gall. When positivism designates the human mind as a lump of matter, it destroys knowledge and science.

Fri, 11/26/2010 - 01:35 | 755505 snowball777
snowball777's picture

"The Austrian praxeological method is based on the heavy use of logical deduction from what THEY assert to be undeniable, self-evident axioms or irrefutable facts about human existence."

So 'conscious' does not imply (colloquial) rational thought and 'goal-directed' does not imply foresight? If that's the case, then what, pray tell, is praxeology attempting to assert anyway? People want things (goal) and attempt to take the most economical path to same ("economically rational"), I presume?

This is probably assertable without question for the average libertarian, but no one ever performs any non-economical action (entering a burning building to save others, for example) or does anything without an explicit goal? No one ever makes impulse buys (don't tell the marketing guys)? No one is ever swayed by emotional rhetoric?

I suppose it's possible the Austrians are just seriously misunderstood, but they haven't done much to help themselves in that respect.

As for my epistemological predilections, reading Goedel has made me a bit of a fallibilist, but I have difficulty escaping critical rationalism and the search for falsifiable assertions (despite Munchy's Trilemma).

 

Fri, 11/26/2010 - 05:00 | 755575 Dr. Acula
Dr. Acula's picture

>THEY assert to be undeniable, self-evident axioms 

Not everyone view them this way. Rothbard views the axioms as empirically true facts about the universe (which happens to contain human beings).

>So 'conscious' does not imply (colloquial) rational thought

I think we actually agree here and I'm just differentiating between technical meanings of words and common meanings. For example, I can be concious and can carve slits into my wrist, and most people would say I wasn't rational. But if it helps relieve psychological uneasiness, then it really is rational. Every concious action is rational in this sense. If my goal is to fly then jumping off a building may be a rational choice - assuming I don't understand anything about gravity or don't have the intellectual capabilities to foresee the disasterous consequences.

>no one ever performs any non-economical action (entering a burning building to save others, for example)

Of course people do those things. Perhaps the hero wants publicity, or he simply values others' lives, or maybe he wants to entertain a death wish. The logical analysis of human action is known as praxeology - see Human Action http://mises.org/books/humanaction.pdf.

>No one ever makes impulse buys

Of course they do. If I value a gravy boat lighthouse http://www.youtube.com/watch?v=z03E084Zhmc more than I value having $1999.99 then I will buy it. I may of course regret it at a later time when my subjective value scale is different. Note that AE deals with real human beings, and not idealized financial computers.

 

Thu, 11/25/2010 - 05:10 | 754328 AnAnonymous
AnAnonymous's picture

The mathematician uses the wood to bonify the soil, and increase return rates, the farmer prefers to stick to the old way, fences his yard and uses the fact the mathematician did not fence his pen to rob from him at night. The engineer uses the wood to design weapons and extort the mathematician into working the engineer's field in addition of his and force the farmer into being farmed so the farmer yields a percentage of his crop he reaps from his and the mathematician's.

Engineer wins.

I know though that Austrians, just like other economists, feign to ignore that side of the problem.

Thu, 11/25/2010 - 09:30 | 754431 Dr. Acula
Dr. Acula's picture

>I know though that Austrians, just like other economists, feign to ignore that side of the problem.

Not at all. Austrian economists deal with real human beings.

For example, consider "the praxeology of coercion": http://www.freedomsphoenix.com/Article/043046-2008-12-22-why-is-social-coercion-wrong.htm?EdNo=001&From=

Also http://www.praxeology.com/praxeology.cfm

You are right, the primary focus is usually on economics: markets comprising voluntary transactions and entrepeneurial action. But there are obviously necessary prerequisites, for example a government and/or private providers of the functions of security and arbitration.

Your scurrilous attack suggests you don't understand AE yet have some alterior motive for criticizing it. I'm curious what that might be. AE proper is wertfrei, a value-free objective science, and not a collection of prescriptions.

Thu, 11/25/2010 - 01:15 | 754180 snowball777
snowball777's picture

I'd offer that LBJ's profligate spending on the Great Society and, more importantly, Vietnam, was anything but Keynesian due to the fact that we were nowhere near a state of deflation (the inflation went from ~1% in '63 to ~6% by 70).

 

Thu, 11/25/2010 - 08:16 | 754421 BigJim
BigJim's picture

Nixon didn't have much choice when it came to closing the gold window, because by then, there were something like 126 dollars in existence for every ounce of government gold in US vaults, which was being priced at $35 an ounce. Gold was draining away from the US overseas at an increasing rate and the US dollar would have collapsed.

Yes, this was partly because of his inflationary policies, but mainly because the US had been spending like drunken sailors on things like wars and 'the Great Society' in the decades running up 'til then.

Don't get me wrong - I'm not holding a candle for tricky Dick - but to blame him solely (rather than him and all his predecessors) for where we are today is just wrong.

I haven't read Friedman, but my understanding is that he was a real free-marketer (except, ironically, when it came to the money supply). Did he REALLY advocate state subsidies for farming?

Thu, 11/25/2010 - 08:54 | 754449 johny2
johny2's picture

Good point about Nixon, Friedman, Greenspan and Bernanke and their likes having plenty of responsibility for today's state of things.. It seems to me that Volcker is a bit better than most of them though. 

 

Fri, 11/26/2010 - 17:17 | 756301 Ted K
Ted K's picture

Let me explain what "ZH orthodoxy" is.  When Reagan was in office cutting taxes and spending us into oblivion Tyler was telling anyone who would listen that brand of Keynesianism was awesome, when guys like Clinton or Obama said people in higher income brackets would have to pay for it, Keynesianism instantly became a shitty idea.  That's "ZH-orthodoxy"  

Sat, 11/27/2010 - 01:04 | 757000 chopper read
chopper read's picture

Ted, you're a partisan whiner.  grow up.  There's an International Banking Cartel that has you in their crosshairs.  

Thu, 11/25/2010 - 00:59 | 754149 Dr. Acula
Dr. Acula's picture

Scarcity is an immutable property of the universe and the human condition.

10,000 years from now, when my cryogenically frozen body is ressurrected, I will be greatly disturbed that I only own 2 neutron stars while the Jones's have 3 black holes. Why would I settle for experiencing 1000 virtual reality hours per second of real time, when I could have 2000? A two-pound brain is lame; I wanted it augmented to 20 lbs.

I agree things like food and shelter will be abundant one day. And people who gorge themselves on food or build ridiculously large houses will be viewed as boorish. People will instead aim at higher pursuits, like gathering friends, artwork, experiences, talents, music, etc. And self-augmentation through technology. I want quantum computer neural implants, nano-fiber muscles, and a fusion-powered engine. Why even own a house or eat food when I can upload myself to VR.

Even if human beings are extinct and replaced by super-intelligent sentient computers, there will be scarcity. Only in a universe devoid of purposeful action and sentient beings will economic scarcity cease to exist.

Keynes is a crackpot and a fool. His pseudoscientific theories - or rather, tangles of fallacies - were unravelled long ago, for example by Hazlitt. 

Thu, 11/25/2010 - 05:30 | 754339 AnAnonymous
AnAnonymous's picture

Scarcity is an immutable property of the universe and the human condition.

 

The universe has developped self consciousness now?

Scarcity like abundance are human developped concepts to apprehend certain issues and should be treated as such.

Thu, 11/25/2010 - 08:44 | 754443 Dr. Acula
Dr. Acula's picture

You are correct. I mis-spoke.

Sat, 11/27/2010 - 01:22 | 757015 chopper read
chopper read's picture

Dr, we went to the moon because those on the top of the food chain were bored, not because nobody was starving in the world, as they always will be.  You see, the mega-rich need starving people striving for food in order parcel their (the working poor's) laborious wealth creation upward via 'temple tax', 'tithe', or 'remittance'. Its a fancy way of describing jungle law.  

Unfortunately, humanity suffers, because the mega-rich do not have a monopoly on good ideas, but rather quite the opposite.  This is why, when we remove the oppressive overlording of taxation without 'benefitation' (or something), then we are, in fact, able to freely trade ourselves to Gilded Age riches. That is, until the feudal lords manoeuvre themselves back on top of our necks and backs. 

 

Thu, 11/25/2010 - 00:50 | 754153 Turd Ferguson
Turd Ferguson's picture

 

"R.I.P, Homo Economicus: On the End of Ubiquitous Poverty and the Beginning of Universal Abundance"

 

What the fuck?!?! How about a headline in English?!

 

Thu, 11/25/2010 - 16:39 | 755039 Dick Buttkiss
Dick Buttkiss's picture

OK, little one, here you go:

"Nighty-night, Those Who Have Previously Had to Work for a Living: A Story About Why There Are So Many People Who Have So Little and How We Can Make Them All Better"

Thu, 11/25/2010 - 02:35 | 754251 Coldfire
Coldfire's picture

You will always have the poor among you... . Matthew 26:11

Thu, 11/25/2010 - 12:50 | 754688 Dick Buttkiss
Dick Buttkiss's picture

Poverty is one thing; "ubiquitous poverty" is another.  Or are you suggesting that a world poverty rate of 80% is natural, rather than a product, as FR maintains, of the "predatory process"?

Thu, 11/25/2010 - 02:35 | 754252 Coldfire
Coldfire's picture

You will always have the poor among you... . Matthew 26:11

Thu, 11/25/2010 - 03:13 | 754255 chopper read
chopper read's picture

poetry, bitchez. 

 

you know, Pol Pot would have had you killed for making this much sense.

Thu, 11/25/2010 - 04:18 | 754306 tony bonn
tony bonn's picture

it is a verity that falling prices do not mean anything ipso facto. they must be compared with other economic phenomenon....prices must be free fluctuate and fuck the tard who thinks that they must always rise or fall....fighting price movements is a fool's errand and a sure way to constipate and destroy an economy....

of course the biggest fool is the fed who is trying desperately to sustain the value of its crappy 2.5 trillion usd portfolio of swiss cheese quickly melting into burnt fondue.

it is also a verity that the lord uses pressure to create diamonds and so in our pressure cooker we may discover the means of vastly eliminating want and scarcity. but god help those to whom he has given much who do not divest themselves of their riches to aid the poor and beleagered.....lord have mercies on us all.

Thu, 11/25/2010 - 05:30 | 754338 Anton LaVey
Anton LaVey's picture

Yes, yes, yet another rant against Keynes. Is this me, or is it getting a very tired refrain here on Zero Hedge? *Yawn*

 

Oh well, let me try and deconstruct a few of the major mistakes in this post:

That is to say, as input quality rises and input quantity falls, both output quality and quantity rise, resulting in the increased productivity that is reflected in the ability to offer the same product (or service) for less or, alternatively, a better product (or service) for the same price.And we have of course been experiencing this very phenomenon for many decades now, as the cost of computing power has fallen precipitously, the industry’s productivity increasing in accordance with what has come to be known as Moore’s Law

Ah, yes, Moore's Law. In other words, a highly complex statement, that should be parsed and completed with many caveats and footnotes. But most people choose to interpret it just as it is (more or less) introduced in this post: "UNLIMITED EXPANSION"!.

As anyone who has studied computing and digital technologies knows Moore's Law does NOT apply to everything under the sun (far from it) and certainly does NOT apply to, let us say, foodstuff, precious metals or raw materials. Ditto for Oil, Drinkable Water and other natural resources. In other words, unlimited expansion is, at best, a dream, at worst a gigantic Madoff-style Ponzi scheme... And scarcity is here to stay. Sorry.

In other words, the author of this post present magical thinking ("Sound money is the solution to all of our problems!") and its (no less magical) conclusions: Sound Money = unlimited expansion, and unlimited productivity. Oh, and Keynes = BAD and I want a pony. Here is just an example of this, taken straight from the article:

[...] productivity would grow exponentially, not only driving prices down at a similar rate but ultimately driving them to the vanishing point , which is to say, to zero. 

Except, of course, anyone can notice the hole in this flawed reasoning: computers are not cars (for instance) -- otherwise, everyone living now would have access to a flying car, or, at least, a car that would get 2500mpg -- and even if cars and computers, they would still require, at the very least, painfully slow and tiring natural resources extraction. Cars, like computers, require plastics, for instance, which are based on petroleum, which need to be pumped out of the ground and, again, what was all the hoopla about that thing named "Peak Oil"?

So, no unlimited expansion. Scarcity is here to stay. And that is totally independant of both "Sound Money" and what Keynes did -- or did not -- advocate. Hmmmmkay?

But wait, there is more nonsense in that post:

[...] the supreme irony being that “the economic problem” could well have already been solved, had a sound monetary system been in place during the near-century that the cartel’s foremost member has held sway.  [...] And the wars that could not have otherwise been funded would not otherwise have been fought, nor would our socially debilitating welfare programs have had the wherewithal to entrench themselves, the combined depredations of which have sapped incalculable amounts of humanity’s time, talent, energy, and imagination.

Yet more example of magical thinking: a return to the Gold standard (or, at the very least a "sound money" system) would have prevented wars? Excuse me? Here is a little quote from a very interesting article:

It has been a commonplace of history for nations on a gold standard to abandon it in times of war, so they could finance their military efforts without constraint. Most combatant nations got rid of their links to gold in World War I and in the Napoleonic Wars, for instance.

(Source: http://www.advisorone.com/article/gleam-gold)

In other words, Gold/Sound money is a constraint when it comes to conflict or difficulties. Surprise, surprise. Also: even if you are on a gold standard, you'll abandon it pretty freaking quickly if you are at war (see: Great Britain, France, WWI).

Now, don't misunderstand me: there is a lot to criticize in Keynes' ideas. But what Keynes simply said is that, in the worst possible case (= economic depression, war, conflict, etc), the State should be the "Lender of Last Resort" to kick-start the economy back into activity. In that respect, yes, just like in time of war, a Government should be free to leave the Gold Standard behind, and run deficits, at least for a while.

But Keynes, as far as I know, never said deficits should be permanent, or that "Sound Money" should be given up forever. On the contrary, I believe he advocated implementing sound fiscal policies, a balanced budget (except in times of crisis), and sound, reasonable social programmes.

The truth is, contrary to what this article posits, sound money or Keynesian policies are not the problem: the problem is corporate welfare ("Let's privatize profits and socialize losses!"), reserve money status of the US$ and the militaro-industrial complex grip on the US economy. Not to mention the "capture" -- and corruption -- of US institutions by private interests and the absurd policies pursued by both major parties of the USA.

The major problem of the current crisis is not so much "sound money" (even though this is definitely part of the problem) but the deregulation of the financial sector, and of the TBTF banks first and foremost. The problem is not so much "Keynesian" policies as it is an amazing, complete and utter corruption of all the institutions of the United States of America, and most other wealthy nations. I believe these institutions, from top to bottom are now pretty much in the hands of the very people who -- through greed and incompetence, and not design or conspiracy -- started this whole mess.

Accusing Keynes for all the problem of the world today is nothing more than poorly thought-out sound bite: it may make you feel better to scream at poor Lord Keynes until you are blue in the face, but it won't solve any of the problems we are facing today. Here is a hint: pollution, over-exploitation and exhaustion of natural resources (here is that pesky Peak Oil again!) and global warming are all very real problems that are going to cause major sufferings... And none of them were ever on the radar of John Maynard Keynes.

Food for thought.

All in all, a poorly worded attack on poor dear Lord Keynes. And no, I don't really think people like Milton Friedman or Ludwig Von Mises would do much better than Keynes in the present situation. Desperate times call for bold, courageous measures, and both boldness and courage -- not to mention intelligence -- are in very short supply today.

 

 

Thu, 11/25/2010 - 09:21 | 754461 Dr. Acula
Dr. Acula's picture

>over-exploitation and exhaustion of natural resources (here is that pesky Peak Oil again!) and global warming are all very real problems

"Over-exploitation" is a problem? What is the right level of exploitation of natural resources? Is it the level directed by market forces and speculators acting to conserve the resource by buying futures? Or is it a different level?

Global warming is a problem? When you deduced this, did you hide the decline? I think it's been renamed to "global climate change" now, or some other such nonsense. BTW what is the optimal temperature of the Earth? Should the Earth be hotter, like it was a decade ago, or should it be cooler than it is now?

Fri, 11/26/2010 - 04:17 | 755566 Anton LaVey
Anton LaVey's picture

"Over-exploitation" is a problem?

If a natural resource disappears, and is lost forever, then, yes, you can talk about over-exploitation. Example: over-fishing results in the disappearance of wild tuna populations: this is over-exploitation. And tuna is disappearing in some regions of the world. In the same vein, cutting down all trees in a forest result in desertification, then, yes, there is over-exploitation and it is a problem. See Haiti for a striking example of deforestation (resulting, I might add, in massive poverty).

Global warming is a problem?

Yes, it is. I know this is very much a taboo subject on ZH, but it is a problem, it is real, and it will result in massive problems and destruction. This is not an article of faith: unlike many here, I have tried to go through the evidence, and it is compelling.

And I can't help but note that you did not address the main point of my argument: that unlimited expansion/growth/progress is simply a pipe dream. Instead, you chose to (weakly) pick on two of my assertions, the one that probably offend your libertarian sensitivities.

Thu, 11/25/2010 - 09:43 | 754476 Withdrawn Sanction
Withdrawn Sanction's picture

"But what Keynes simply said is that, in the worst possible case (= economic depression, war, conflict, etc), the State should be the "Lender of Last Resort" to kick-start the economy back into activity."

OK.  That sounds like a fair representation of Keynes's argument.

His assertion makes a couple of intertwined (and incorrect) assumptions.  (1) That cleansing process of bankruptcy serves no useful purpose (thus depressions should be stopped by the lender of last resort).  The reallocation of resources that occurs in depression is painful but necessary.

(2) Even more importantly, it assumes the state not only knows the correct course to take but that it will do so.  IOW, the state-based saviors are not themselves s/t the same issues of self-interest and error that afflict the rest of us.

While individual error tend to be locally confined, state based errors affect many more.  So even if one accepts a benign interpretation of Keynes (which deals w/the first problem), the type of persons it requires for implementation do not exist.

Fri, 11/26/2010 - 05:18 | 755581 Anton LaVey
Anton LaVey's picture

His assertion makes a couple of intertwined (and incorrect) assumptions.  (1) That cleansing process of bankruptcy serves no useful purpose (thus depressions should be stopped by the lender of last resort).  The reallocation of resources that occurs in depression is painful but necessary.

By "His" I suppose you mean "me". So, here are my answers, since John Maynard Keynes is not among us to defnd himself. First of all, bankruptcy definitely has a purpose and it is definitely part of a recovery (contrary to the statements you put in my (and Keynes?) mouth). However, a depression is a completely different beast: in a depression, bankruptcies are "unending" and create a negative feedback, resulting in more bankruptcies, which end up destroying pretty much the entire productive capacity of an economy. This is why Keynes suggested the Governement as "lender of last resort": to prevent the collapse of an economy in a Depression.

However, what Keynes did not ask for, was for the Governement to be a permanent lender to the economy - as far as I know, the role of lender of last resort was to be strictly confined to the periods of deep economic crisis or depressions. While I am no expert in Keynes, I also strongly suspect he would have approved of the re-allocation of resources and capital that happen in a depression. What he was concerned about was the runaway, negative spiral destruction of a depression.

(2) Even more importantly, it assumes the state not only knows the correct course to take but that it will do so.  IOW, the state-based saviors are not themselves s/t the same issues of self-interest and error that afflict the rest of us.

This is pretty much standard libertarian tripe, totally unjustified, and pretty much contradicted by history and logic. Not everyone is compelled by issues of self-interest. Some people are motivated by the common good and by purposes higher than simple self-interest.

On the other hand, the valid part of that statement is that Government does not always know what would be better for the economy -- which is exactly why Keynes proposed that infrastructure should be the focus of Governement intervention in the middle of a depression. Infrastructure investment, usually massive in scope, are both a perfect way to kick an economy back to life, and, once economic growth is back, to sustain this growth in the medium- to long-term.

Right now, I believe that few would dispute that the US infrastructure is in a dire state of disrepair. One example is that high-speed train links exist in Europe, and are practically unknown in the USA. Another example would be renewable energy and energy independance, which is probably crucial for the years to come (that pesky Peak Oil thing again!), etc... etc...

Unfortunately, investment (lending of last resort?) spending by the US Governement in these different areas has been woefully inadequate. I suspect it is because the same US Governement is -- as I stated in my first post -- pretty much corrupted and controlled by the financial and industrial/military oligarchies and has been running DEFICITS (something Lord Keynes never advocated) for decades now. But these deficits do not benefit the economy at large, simply the TBTF banks and the insane profits of the military/industrial complex... All of this is definitely inefficient, given the great "successes" of the US military in Iraq and Afghanistan... (Food for thought: where is Osama Bin Laden right now?)

In other words, while Government may be efficient as a lender of last resort -- something I admit could be disputed -- a CORRUPTED Governement does not stand a chance. And the reason for this is because a corrupted Governement will always redirect public money to its masters.

Keynes even suggested (in jest) that Governement intervention could be limited to burying money deep in the ground and paying people to dig up the money. I suspect even this "solution" would be a better use of public funds, at this stage, than giving those to either Goldman Sachs & JP Morgan or to Boeing & General Dynamics. But I digress.

While individual error tend to be locally confined, state based errors affect many more.

This statement is ridiculous: when the TBTF banks make, shall we say, "individual" "mistakes" (such as fraud and market manipulation), the entire world economy craters and we all suffer. When (millions of) individual citizens make poor financial decisions -- such as taking on too much debt and not reading lending contracts, the massive indebtness result in systemic risks, the economy craters, and we all suffer. Ireland is a perfect example of this. Wall Street is another one.

While you are correct in saying that state mistakes affect a lot of people, I would also say that, in a democracy, the correction is very simple: simply vote against the politicians who made the mistakes and created the problems in the first place and for politicians who offer sensible solutions to the problem. But, again, this is assuming the rule of law and the democratic process work as they are supposed to work!!... Which brings me back to my main argument, and also the reason I believe Keynesian policies do not "work" right now: the state has been corrupted and only work, right now, for a small posse of (very) rich people.

Correcting the present situation, therefore, means first of all restoring the integrity of Government, and its independence from the wealthiest. It means restoring the rule of law and the enforcement of global rules. This is, I believe, where Keynes falls short: he never envisioned a state as weakened and corrupted as the present Governement of the united States. Clean up Government, restore the rule of law, stop propping up bloated and inefficient industries (Wall Street comes to mind) and then, and only then can we discuss the validity of Keynesian policies.

Do not misunderstand me: there is a place for private enterprise, and there is a place for governement intervention. But Governement intervention corrupted by private enterprise is definitely the worst of both worlds. And this is something Keynes never envisioned -- and who can blame him for this?

Sat, 11/27/2010 - 01:26 | 757026 chopper read
chopper read's picture


keynesian economics, at its best, succeeds in punishing the saver and investor (never allowing for falling prices) and rewards reckless borrowing and rabid consumption at the expense of conservation.

worse yet, you continue to enable the thievery with cries of,

"THEY'RE JUST NOT DOING IT RIGHT!"

After 54 years of communism in Cuba, are they "just not doing it right"?

view the expansion of outright global enslavement as keynesian debt-based monetary systems have been exported from Great Britain and the United States and gripped the globe.:

http://www.economist.com/blogs/dailychart/2010/11/government_debt?fsrc=s

who do you believe is receiving these interest payments? Why are we paying a private organization to circulate a private currency? why has this currency removed itself from any asset-backing against all presidence in relation to the past 5,000 years? 

Why do we pay interest to a private banking cartel simply so we can trade with each other? Further, our massive treasury bond market is grossly front-ran by the International Banking Cartel, including your good buddies Goldman Sachs and JP Morgan Case. How can you or anyone be apologetic on behalf of this fraud? How is this moral?

Do you have ANY IDEA what is taking place in Europe right now? Are you recognizing how Ireland is going the way of Jamaica, DR Congo, South Africa, and Turkey as it is "saved" by the IMF? Of course, this is not for free, is it? Any ideas who the IMF will "save" in the future?!!

WHY NOT introduce Kennedy's asset-backed silver certificates and Lincoln's population-linked greenbacks?

WHY NOT allow multiple means of paying Federal taxes beyond a paper note of a private corporation?! Is not our current system insane? Has this not caused major suffering since the Federal Reserve Act of 1913?!! Did we not have our very own Gilded Age prior to this debt-based monetary system which brought 8,000 tons of gold to our shores that sits in Fort Knox today?!! How do you believe that America became so prosperous?!!

 

DO YOU WISH TO KNOW WHY WE REVOLTED AGAINST THE BRITISH (ROTHSCHILD'S BANK OF ENGLAND) FROM THE START?

“Capitalism is organized crime and we are living in an usury-market economy, not a free-market economy. It is by design that the rich get richer and the poor get poorer, not by accident. ”- George Washington

"We began planning the Revolutionary War in order to issue our own money again ...and keep King George III and Bank of England from enslaving us with debt, and making Americans their financial slaves." ~ Benjamin Franklin, 1790.

YOUR KEYNESIAN APOLOGETICS ENABLE THESE LUNATICS!!!

http://www.youtube.com/watch?v=jgCDsjfGd

WAKE UP!!! we are getting PLAYED!!!!!!

Consider this excerpt from Bill Bryson's book, "At Home" (pages 233 - 235). It highlights the period in America where there was no income tax or other major 'redistribution of wealth', and there was no centralized (communist) policy for money planning allowing for a private monopoly on 'legal tender', but rather both competing and single asset-backed currencies at various times in various regions.

Ideas and wealth were pouring into America with this more favorable business environment. The "gap" between the wealthiest people and the poorest was, of course, boundless, but the additional wealth creation came in from overseas via massive exporting, and, in addition to the entrepreneurial "rich" creating manufacturing jobs, they threw parties and built homes that created jobs, and they funded universities and hospitals to secure their legacies (as the mega-rich very often do). They also brought art and worldly treasures to our shores that sit in our museums today.

Importantly at this time, ambitious immigrant workers were certainly no less "exploited" than anywhere else in the world and, unlike the restrictive class barriers and lack of upward mobility in Europe, new and existing Americans were becoming millionaires by the tens of thousands.

This growth was not agrarian via slavery (this ended in 1865) or cotton, but rather industrial via steel and ingenuity and, most importantly, via the power of property rights (including virtually no taxes, i.e. "right to your own wealth") and free markets. This unprecedented growth happened decades before "the roaring 20's" of easy credit created by the private Federal Reserve Bank.

Read for yourself:

"The Eiffel Tower was the most striking and imaginative large structure in the world in the nineteenth century, and perhaps the greatest structural achievement too, but it wasn't the most expensive building of its century or even of its year. At the very moment that the Eiffel Tower was rising in Paris, two thousand miles away in the foothills of the Appalachian Mountains in North Carolina an even more expensive structure was going up - a private residence on rather a grand scale. It would take more than twice as long to complete as the Eiffel Tower, employ four times as many workers, cost three times as much to build, and was intended to be lived in for just a few months a year by one man and his mother. Called Biltmore, it was (and remains) the largest private house ever built in North America. Nothing can say more about the shifting economics of the late nineteenth century than that the residents of the New World were now building houses greater than the greatest monuments of the Old. 

America in 1889 was in the sumptuous midst of the period of hyper-self-indulgence known as the Gilded Age. There would never be another time to equal it. Between 1850 and 1900 every measure of wealth, productivity and well-being skyrocketed in America. the country's population in the period tripled, but its wealth increased by a factor of thirteen. Steel production went from 13,000 tons a year to 11.3 million. Exports of metal products of all kinds - guns, rails, pipes, boilers, and machinery of every description - went from $6 million to $120 million.

The number of millionaires, fewer than twenty in 1850, rose to forty thousand by century's end. Europeans viewed America's industrial ambitions with amusement, then consternation and finally alarm. In Britain, a National Efficiency Movement arose with the idea of recapturing the bulldog spirit that had formerly made Britain pre-eminent. Books with titles like The American Invaders and The 'American Commercial Invasion' of Europe sold briskly. But actually what Europeans were seeing was only the beginning. 

By the early twentieth century America was producing more steel than Germany and Britain combined - a circumstance that would have seemed inconceivable half a century before. What particularly galled the Europeans was that nearly all the technological advances in steel production were made in Europe, but it was America that made the steel. In 1901, J.P. Morgan absorbed and amalgamated a host of smaller companies into the mighty US Steel Corporation, the largest business enterprise in the world had ever seen. With a value of $1.4 billion it was worth more than all the land in the United States west of the Mississippi and twice the size of the US federal government if measured by annual revenue. 

America's industrial success produced a roll call of financial magnificence: Rockefellers, Morgan’s, Astor’s, Melons, Morgan’s, Frocks, Carnegies, Gould’s, du Pont’s, Belmont’s, Harriman’s, Huntington’s, Vanderbilt’s and many more basked in the dynastic wealth of essentially in exhaustible proportions. John D. Rockefeller made $1 billion a year, measured in today's money, and paid no income tax. No one did, for income tax did not yet exist in America. Congress tried to introduce an income tax of 2 per cent on earnings over $4,000 in 1894, but the Supreme Court ruled it unconstitutional. Income tax wouldn't become a regular part of American life until 1914, and in the meantime any money that was made was kept. People would never be this rich again."

http://www.zerohedge.com/forum/how-do-we-arrive-eve-our-collapse-0

Thu, 11/25/2010 - 05:32 | 754340 Azannoth
Azannoth's picture

A quote I found on the Internet

 

"The danger to America is not Barack Obama but a citizenry capable of entrusting a man like him with the Presidency. It will be far easier to limit and undo the follies of an Obama presidency than to restore the necessary common sense and good judgment to a depraved electorate willing to have such a man for their president. The problem is much deeper and far more serious than Mr. Obama, who is a mere symptom of what ails America. Blaming the prince of the fools should not blind anyone to the vast confederacy of fools that made him their prince. The Republic can survive a Barack Obama, who is, after all, merely a fool. It is less likely to survive a multitude of fools such as those who made him their president."

Thu, 11/25/2010 - 06:53 | 754377 Manipulism
Manipulism's picture

Nice.

Cn you give us the link?

Thu, 11/25/2010 - 09:08 | 754455 Dr. Acula
Dr. Acula's picture

Ouch

Sat, 11/27/2010 - 01:28 | 757027 chopper read
chopper read's picture

truth stings, eh?

Thu, 11/25/2010 - 13:37 | 754768 Husk-Erzulie
Husk-Erzulie's picture

Beautiful...Oh so link-a-belle.  Linky poo?

Thu, 11/25/2010 - 14:20 | 754826 snowball777
snowball777's picture

Replace Obama with Reagan, Bush, or Clinton...same difference.

Thu, 11/25/2010 - 14:58 | 754899 cosmictrainwreck
cosmictrainwreck's picture

+10 Yup. I keep ranting at all the partisan knumbskulls around me that IT DON'T MAKE NO FUUCKIN' DIFF who occupies a mansion at 1600 Penn. Don't they get it that other humanoids/entities run the damn show? One of my faves was when Bark called the big Banking summit, and the 3 or 4 dudes sudeendly "couldn't make it" cause of travel conflict or whatever. HA

Thu, 11/25/2010 - 23:42 | 755404 RockyRacoon
RockyRacoon's picture

Rebuttal "found on the internet":

When they say "depraved electorate", do they mean like the people that voted twice for president a frat boy who served his country drunk and AWOL from his cushy REMF statesides posting while maligning the service records of American veterans who were wounded while serving their country underfire in Vietnam, and then started two failed wars? Do they mean the same people who twice voted for president a retired actor suffering from Alzheimer's disease whose greatest professional moment came while playing a supporting actor to a chimpanzee?

Is that what they mean by "depraved electorate"?

Thu, 11/25/2010 - 07:50 | 754404 tradewithdave
tradewithdave's picture

The deception found within scarcity is true if you believe it is true.  Indeed it manifests itself within abundance as we allow it.  Just picture the homeless person sleeping on the heat grate outside of a bank headquarters.  The very wall he is leaning against for protection is the same wall that protects the vault filled with so-called valuables.  That's real and it's a choice we all participate in.  We use the bank, we carefully step around the cardboard box.  That's scarcity, no? 

But there's a more powerful force at work within what would otherwise be a dark room.  A small candle is lit.  Where's the darkness.  It's still there, but it was a lie.  It had no power.  You had the power.  Creation had the power.  You lit the candle.  You made the candle.  You dipped it and taught others how to dip it.  The ingredients were there all along.  The wax, the honey bee, the flint, the steel.  Who's going to start the fire? 

You can hide in your McMansion or you can hide under your cardboard box, or behind your screen name, but you can't hide from abundance.  It demands to be heard in the birds outside my window, it demands to be seen in the acorns cracking open and their green stem reaching down to the earth, it demands to be felt in the warm sun beating down on my shoulders.  You can run from abundance.  You can hide from abundance.  You can even deny abundance.  Each of us was given that mighty choice to deny its existence and to believe that we are the creator and not the created. 

We can love scarcity.  We can embrace Sartre's No Exit because that's what we deserve.  He was right, in our own power there's no escape and Hell is other people.  The one truth found in the denial of a priori and the existentialist view is that it is a perfect example of our free will regardless of your belief in its origins. 

Look out your window.  Look at your plate.  Look in your child's eyes and tell me there is no abundance.  Tell me and it is true for you.  The problem for me is not seeing the abundance, but accepting it.  Undeserving.  Flawed.  Failure.  Why are these gifts for me?  Why am I forgiven?  Why does the child's eye glisten with love?  There's only one possible answer.  Grace. 

Dave Harrison

www.tradewithdave.com

 

Thu, 11/25/2010 - 08:24 | 754427 Azannoth
Azannoth's picture

Reads like ramblings of a schisophrenic

Thu, 11/25/2010 - 18:02 | 755141 tip e. canoe
tip e. canoe's picture

“Capitalism is schizophrenia, insofar as the society-structure cannot support the production of ‘schizo.’” - felix guattari

Thu, 11/25/2010 - 11:18 | 754535 honestann
honestann's picture

I mostly agree.  Unfortunately, we also have an extreme abundance of predators and leaches.  Those of us who can oh so clearly see the endless abundance, and the endless ways to organize the abundance into wonderful configurations, are sought out and enslaved or destroyed by those who prefer to be predators or leaches and not producers.

One huge problem is also part of the fundamental nature of existence --- destruction is inherently and metaphysically vastly more potent than production.  A simple example makes this utterly clear.  Consider how much time, effort, skills, experience and resources are required to build a beautiful, wonderful modern home.  Now consider how much time, effort, skills, experience and resources are required to destroy that home.  Hint: A low grade moron with $1 worth of gasoline and free matches can start the fire in one minute that will burn down the home.

The predators know this.  They know they need merely threaten destruction, and producers will pay them to "go away and not destroy".  This is called "protection money" if the mafia does it, or "taxes" if the government does it, or "ransom" if a kidnapper does it, etc.

So I agree with you, but honest, ethical, productive, benevolent humans need to put their foot down and refuse to be enslaved this way.  Otherwise evil wins.

Thu, 11/25/2010 - 08:36 | 754438 Slartibartfast
Slartibartfast's picture

And Greed and Corruption have had no role to play in all this (besides the primary role)? Remember, Keynes lived in a time when personal honour meant a whacking great more than it does today. His biggest mistake was in not considering that our personal habits and philosophy could be corroded to such a degree as we see today.

Thu, 11/25/2010 - 08:49 | 754447 Peace is the x-axis
Peace is the x-axis's picture

"Personal honour/habits/philosophy"? Keynes?? See post and link above.

Sat, 11/27/2010 - 01:38 | 757031 chopper read
chopper read's picture

exactly.  he was a complete lunatic with just enough time and misguided intelligence to construct a self-serving economic lie to empower his employers with more thuggish might.  he was paid handsomely for his fraudulent rhetoric, and probably had some nice celebratory weekend romps.  keep in mind, in order to enact this farce, gold was taken from free-traders at gunpoint by the 'letter of the law'.  does this not tell us everything we need to know?  

he was not a patriot to individual ruggedness and liberty, but rather a traitor to fellow Americans, and his ideas still cause us suffering today. 

 

fuck keynes.  he was wasted talent, at best. 

Thu, 11/25/2010 - 08:58 | 754448 Dr. Acula
Dr. Acula's picture

Are you kidding me? Do you honestly think human nature was any different in the past?

"How Venice Rigged The First, and Worst, Global Financial Collapse... 30 million people died in Europe in the ensuing Black Death, famine, and war" - http://www.schillerinstitute.org/fid_91-96/954_Gallagher_Venice_rig.html

Keynes' theory is full of fallacies through and through, as was shown when Hazlitt disected it. Keynes' theories are false because they are logically false, not because of the time period he lived in or because of the time period now.

What has changed is that today's Austrian economics is vastly superior to the economic knowledge of the past. But unfortunately, because economics relates to politics, as does climatology, it is influenced by big money and the profession is swamped by pseudoscientists and crooks.

 

Thu, 11/25/2010 - 11:09 | 754524 honestann
honestann's picture

Well, depending on what you consider part of "human nature", I would say "yes".

People 100+ years ago were vastly more "grounded".  Try to pull convince a family farmer (even today) to believe some abstract scam agrument.  Good luck!  They are directly connected to reality in almost everything they do, and much more often recognize an abstraction wielding wise-mouth city-slicker and his scams.

Today, almost all humans are literally, clinically and technically insane, probably because they deal with carefully crafted bogus abstractions far more than physical reality.

In the past (the longer the better), humans created their mental-units (ideas/concepts) because they encounted similar real, physical existents or phenomenon in reality, and therefore had very good utilitarian reason to form a mental-unit to identify that existent or phenomenon.  Thus, their mental-units were "grounded" and "reality based".

Today, most humans get their mental-units from parents, school, church, friends, television - in the form of language.  In other words, the name-label of the mental-unit is provided first (when they hear the word/term), then the contents are inserted into the mental-unit when as listen to other humans spew more words and terms supposedly associated with that mental-unit.

Today, kids (and adults) have exactly zero reality or grounding for their mental units for a long time, and often forever.  To be sure, they sometimes do observe real existents that some of these mental-units refer-to, and thereby gain some reality or grounding for them, but even then most of their content is pure assertion via language (not first-hand observation or first-hand inference).

Worse yet, the brains of most humans today are absolutely chock full of bogus abstract mental-units that are 100% baseless --- they are 100% fake, fraud, fiction, fantasy... but are inserted into their minds nonetheless.  In most humans, these bogus mental-units have just as much power to motivate as reality-based mental-units.  Unless a human becomes totally clear in his own mind that a mental-unit does not refer to anything real (is a fiction), that human will behave as if the mental-unit is valid, and does refer to real existents.

Hence, today probably 99.9999% of humans believe that totally bogus mental-units are utterly, totally, completely legitimate... very crucial mental-units, like "government" and "corporation" for example.  Even though all organizations, including these, are called "fictitious entities" in fundamental law, most humans wander around their entire lives thinking and behaving on the basis that these hundreds of bogus, fraudulant mental-units are legitimate.  This 99.9999% of human are therefore insane, in the most fundamental way possible --- they are incapable of distinguishing reality from nothing.

I don't think the current trend toward complete insanity and complete enslavement of humans by the predator class shows much sign of reversal.  Even liberty advocates often refer to "what the founding fathers said", and thus base their argument on "their authority"... as if that is any kind of fundamental argument against "today's authority".  They never seem to wonder, "Hey, I never signed any of those documents (declaration of independence and federal/state/local constitutions), so therefore they have zero to do with me or my behavior, except by coincidence".  They never ask whether government exists, or whether government even can exist (it can't).  It is a fiction just as completely as the ToothFairy or SantaClaus.

So yeah, in some ways I do believe "human nature" has changed from the past.  Unfortunately, the changes are almost 100% negative.  Humans were formerly [mostly] sane (other than their religions), and now they are almost completely insane --- even most of the supposedly "most intelligent" of them.

The "modern monetary problem" is a perfect example of this.  Only a complete fool would accept a worthless piece of paper in exchange for real, physical goods that required much time, effort and resources to produce.  Yet 100% of modern "money" or "currencies" are absolute, complete, utter fiat, fake, fraud, fiction, fantasy (as "value" but not as "paper").  The entire "monetary system" today is 100% detached from reality.  But how many "smart folks" recognize this is an important and fundamental part of the problem with the world economy today?  Sigh.

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