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Understanding Unintended Consequences
As you get older and start thinking more, you realize there are more layers to even seemingly straightforward problems. When you are young, solutions are simple: If drugs are bad, we should make them illegal and put people in jail for using them. Or if we need to raise revenue, we should raise taxes on everyone, especially the rich. Perhaps this is the logic behind the saying, "If you are young and not liberal, then you have no heart; but if you are old and not conservative, then you have no brain." Once you've been around the block and seen enough shenanigans, you realize things aren't so simple. When you're young, you're what I like to call a do-gooder; you don't even realize there is such a thing as unintended consequences.
Unintended consequences come in many forms. There are unintended consequences in our foreign policy, such as those that came from the CIA-led overthrow of the democratically elected Prime Minister of Iran. We put the brutish Shah of Iran in power, making the Iranian people suffer for 26 years, which led to the radical movement there and the instability in the Middle East. Unintended consequence. The average person my age thinks I'm making these kind of things up because they don't read. I let them wallow in their ignorance- these are generally accepted historical facts that you must know and accept to peer into the future. If you don't have the ability to objectively view history, then you will not be able to see what's coming; you are too biased.
Then there are finance and economics-related unintended consequences. For example, if our leaders fear a stock market crash, they ban short selling. Little do they realize that short sellers are the only buyers in a panic and that stocks fall like a rock without short sellers. Or better yet, we overregulate markets with Sarbanes-Oxley to the point that new companies don't want to do business here. Solutions like these evidence a complete lack of knowledge of markets. This is the hallmark of government- they graduate with degrees in law and think they can preside over an economy. Who are they fooling?
Our leaders are clueless and you will be hard-pressed to find one politician, besides Ron Paul, who saw this crisis coming. Most politicians have their focus on the wrong problem. The debate now is whether we should raise taxes on the rich or not. Well let me tell you, the rich happen to be the movers and shakers in the economy who create jobs; they can easily take their businesses abroad if they have to. By raising taxes in the hopes of boosting revenue, we will likely do the exact opposite. Instead of attacking domestic capital, we should worry about the problem of sending hundreds of billions of dollars abroad annually to service our debt to foreigners. It is the debt that is going to bring this ship down.
The worst is yet to come because our leaders don't know how to deal with this debt crisis. Cut spending and you will see a dramatic rise in unemployment from the public sector and civil unrest. Raise taxes and you will see rising unemployment, slower economic growth, and a flight of capital abroad. Print money and kick the can down the road and you will see most assets, including stocks, go to record highs. Because this cycle will be one where people generally lose their faith in government, gold is going to rise even higher in percentage terms than most assets. I feel like this is 2007 all over again: the storm clouds are painfully obvious, I'm warning everyone around me about what's coming, but people are too apathetic to prepare or they flat-out don't believe me. Fine. Let's see how this plays out; I am positive the magnitude of this crisis will be shocking.
Article taken from Expected Returns Blog.
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The only thing that bothers me about gold, is that it isn't much use in itself.
This article was utter carp and junked by me for one. It is news to me that the uber rich would create jobs if left untaxed that is utter bollox as all the evidence shows, it just gets offshored.
Tax should fall heaviest on unproductive wealth. Investment banks need taxing to within an inch of their sorry lives. Why TF are Iraq,Afghanistan and Libya being invaded?
Invade Switzerland and the Cayman Isles it'll pay for itself a trillion times over in about half an hour.
How about we invade you?
Pathetic, unproductive, wannabe THIEF.
It is news to me that the uber rich would create jobs if left untaxed that is utter bollox as all the evidence shows, it just gets offshored.
Tax should fall heaviest on unproductive wealth.
+1
Switzerland is not a good idea. They are the most armed country per capita in the world. Like Israel, every living person must join the military, and every household is armed.
Caymen, well, go ahead. Take those dollars. Enjoy your campfires with them.
i doubt the usa could take on the swiss national guard myself. sure the first week might look one sided. but then they would get bogged down in the house-to-house and surrounding countryside.
Heard that argument, usually about a civilian put-down. It ends by description of force multipliers and Apache death from a quarter mile.
Who's bogged down, the group using a handful of choppers and limited ground troops to control hundreds of thousands, or the guerrillas?
Apaches have limited range and are highly susceptible to Swiss force multipliers. The US should stick mountainous, small arms filled populaces that it can easily control, like Afganistan... where it isn't going to get bogged down.
War sucks, but the US has demonstrated that it sucks at winning wars.
Okay, it just grates me when I hear how raising taxes will decrease jobs. It may be true at this point in time because the whole stupid free trade train that keeps on rolling along. Without free trade it would not be true. Without free trade, it is completely logical that higher taxes on the rich stimulates the economy. The reason for this is pure human nature. If the taxes are high enough, the rich work hard to avoid them. They do that by investing in their businesses. That way their net worth increases, but their income decreases and they are taxed less. By increasing their investment in their businesses, they create more jobs. The people with the jobs pay more taxes and use less social services, so the economy is stimulated.
With free trade though, they can avoid the taxes by growing businesses in other countries. Since they don't have to pay import taxes, they still avoid the taxes when they import the goods. Free trade is the problem to creating jobs in a place that has a higher standard of living than hell hole China where they live in dorms, work all the time and have to sign contracts saying they won't kill themselves to get the job.
You go girl. Math works whether they understand it or not. And they tend not to be particularly bothered with reality.
They lowered the tax to on the wealthy to create jobs to kick-off the turn of the Century. Jobs created didn't keep up with population, then the jobs that were created, literally vanished, probably for good.. unless a big part of your job was pimping Supersized Meals.
Because it was finally ruled illegal to provide particular incentives to create jobs in foreign countries, they had to come up with The American Jobs Creation Act. In this plan, US based Corps were given 2 years to build/expand their businesses in foreign countries. At the end of the period, their incentive was to repatriate these newly found earnings at the one time discount of a 5% Corporate tax. They would then capex new production in the US and create US jobs.
On the Day of Bounty, my folk at PFE repatriated somewhere $15-20B. Had a hiring freeze except for fieldforce, and laid off 5000 US later that year. On the day of the press release, American Instrument announced their take$, and their plan to lay off 3000US in the same press release.
We bailed the failed Banks (and their failed business models), failed businesses (and their failed business models), and the the creditors who had made failed investments. That certainly has worked out well.
There is an obscure footnote in the Sacred Scrolls of the Neo-Classical-Neo-Liberal-Freetraders. The great equalizer defending against the Wealthy and Private Equity being in a position to buy the Statue of Liberty, Independence Hall. and YellowStone Park is that when their cheap-money Bubbles break, they are supposed to get hit the hardest.
So the strategy was to create their cheap-money Bubble of pleasure, then make sure their capital didn't get destroyed.
It worked for them.
So how's that workin' out for you (us)?
Here's the irrationality of the Wealthy "creating jobs".... besides the evidence of 10+ years of practical evidence.
Fuck 'em. Let them go ahead and move. Where should they set up their new "Free Market" Mansions and Corporations?
China?
Honk Kong?
Taiwan?
Indonesia?
Brazil?
Ireland?
Greece Italy Portugal Spain?
France?
They fret over Taxes, Socialism, Regulation, Nationalization, Government, and National Debt? Go ahead pick up your marbles and move.
Germany would probably be best. But the German People have a way of handling that. Worldclass retail modeller WMT, built their 85th Mega-Store in Germany just in time to to close and sell them as their largest writedown in the past 10 yrs.
Britain might be Ok. But they are about to re-instate their version of Glass-Stegall. ANd a bunch of other clamps on the bnaks, who would have to lead the way. Oh, and they tax the shit out of unearned income compared to the US.
What? No takers?
There is no place on Earth where they have it better, with less risk.
For openers they would have to pay more to buy the governments. They have been at it a lot longer than us, and the tolls are higher.
Um.. BTW, their friendly Fed will not be over there with his world Reserve Currency.
And when the riots get to their Mansions, they'll want to make sure the gov't wants to save them, and not prefer to want do a redecoration after the fighting and they move in.
"There is no place on Earth where they have it better, with less risk"
That was true a quarter century ago, today, not so much.
The U.S.A. has never been at this inflection point where it was so deeply in debt, so broadly betrayed by forces within, with such a small % of the population self-sustaining (not living on a farm and knowing how to raise crops and livestock) and so completely deluded about its susceptibility to collapse and conquering forces from within via lustful greed and betrayal.
The moral hazard of the bailouts, and the unintended consequences, are that the formerly patiriotic heart of the country doubts, disbelieves, and is furious about the rape of the sacrifices of previous generations.
I can't think of a modern epoch where so many good people were sold out and parasitized so quickly, so completely, and so quickly as the working class responsible American middle class families of the past century.
It is nearly unbeleviable, and breathtaking, to comprehend such a tradedy taking place before our eyes.
Tragic, astoundingly tragic.
This is about the best synopses I've ever read on ZH to sum up my feelings. It's just too bad that you're correct.
+1000
I have never begrudged success to anybody. It inspires me, challenges me. And self-ego envy is the biggest waste of mental time you can make.
I just resent the motherfuckers who have jumped up the ladder by virtue of the (unsupported) largess of the US citizens, and are now trying to pull the ladders up behind them.
I am enjoying reading your posts ... +++
"with such a small % of the population self-sustaining (not living on a farm and knowing how to raise crops and livestock)"
The powers that be are making it hard for people to change to a non-parasitic way too. Thankfully I live where there were no questions asked about planting a garden in our front and side yards, and the chickens were legal here too, but we did get turned in for having dwarf goats. Still thankfully, they allowed us the permit for them after the fact. We talked about how we needed them because our daughter had so many food allergies, so they gave in. One old guy on the city council talked about raising his kids on goat's milk, and won the day for us.
Anyway, I live in a very rural place, so it has worked for us, but for others they can't have any of this stuff. They are forced to live in the typical suburban way.
Another self-congratulating indoctrination victim: secular pastor.
"Instability" is a technical term for justified military intervention. I see much more "stability" in the Middle East, US military controlled oil reserves and dictatorships.
It's such proud hollowness that the youngsters quease at, Mister.
+1
My wife thinks I'm nuts because of food stocking. When dates have less
than 1 year left, I donate to food bank. Have donated some already
and replaced it with 4 times amount. I have children and grandchildren.
I told her to humor me, besides we are Christian people and donate to
food banks anyhow.
+++
I have also been canning my own foods, strawberries were great this year picked 140 pounds at local upick (if you want the best jam, you got to make your own) and blueberries are going to be a bumper crop...
I plant a big garden and give my excess produce to the food bank, same with eggs from 23 hens.
Went to Costco this weekend for some more beans n rice. Found two 50lb bags of rice, no beans. Asked little old lady where the beans were, she told me of another store to go to. As I pushed my cart away she eyed the bags of rice, leaned toward me and said "stocking up are you?" with a very knowing look. I said, "Yes, ma'm are you". "Oh, yes guns, too", she said. My wife found this really funny, me having only recently convinced her this was a solid plan. Then she realized just how serious it's getting.
i like your style, and you structure your thoughts well. In spite of both the former and the latter, I gave you three stars: we're well past solution. Pretend and patty-cakes are fine when there's no wolves at the door in the dead of winter -- little girls can't be suddenly mustered for defense against man-eaters. So you've got a good politician. God bless him. They've got a whole system perfectly articulated to prevent men like Dr. Paul from seizing the septer to begin with; I advise him to speak Truth to power and remember how fate is very chummy with bravery.
We're in some serious, serious trouble.
All that needs to have been said, has been said on this site over the last year...
We now just need to wait... and continue to buy PMs and stock up on food... and "protective" products...
Lets see. The war on drugs has increased the availability and decreased the price. The war on illiteracy has created whole new generations of illiterates. The war on poverty has created more poor than ever. Nixon's war on cancer never produced anything. The subsidies for housing rendered housing unaffordable. The subsidies for college education raised the cost of a college education so high a whole generation is going broke affording it. Government efforts for affordable healthcare has raised medical rates so high we're going bankrupt over it. Why the opposite effect?
Physics!! Newton's 3rd Law: For every action there's an equal and opposite reaction.
"I'm warning everyone around me about what's coming, but people are too apathetic to prepare or they flat-out don't believe me."
DITTO!
My parents are clueless, too. It takes a mental shift that they're not ready to make. Amazing to me since they (Boomers) are the children of parents who lived through the Depression. My grandfathers were adamant about never holding debt and I never knew why until my eyes were opened. We've all been sold a great lie--that each generation will be better off than the next. It's hard to swallow for many. I'm struggling with the fact that because I will be prepared with PMs, guns, and food stores, etc. I may be the one caring for my parents who are far better off than I in the fiat world. In a post fiat world I will be the one they run to.
We've lived in a fantasy world so long, we forget about the enduring human condition of struggle. We just can't imagine that it isn't so. We'll be forced to face that reality soon enough.
God, I hope I'm wrong, yet my gut tells me I'm not. I'd love to believe I am for I truly don't want to see it all go to hell. Sad, but so predictable.
I told my 67 year old mom in Florida that I am "stocking up" on non perishables which might go up in price due to inflation. She said "I don't want to hear any of your Armageddon theories." They are not ready for things to change in the slightest way down there.
My parents and brother have been quite open to it and have all stocked up like me. I have approached them all with the attitude that I can't know for sure, but better to be safe than sorry.
Ike has it under control.
We'll send in the Marines.
Walter Cronkite says everything is fine.
We're the greatest and we've never really lost before so carry on.
What's the matter with you? Conspiracy theories? What do you mean we aren't the world power anymore? Deficit? Oh yeah, been there before. War bonds and a victory garden, all will be well.
I'm going to buy an new Chevy next month.
God I love this country.
Can't wait for the World Series.
Did you hear that Joe Dimaggio is selling those new-fangled "Mr. Coffee" machines on Television?
What the hell is your child carrying, it looks like a communicator from that new-fangled science fiction show "Star Track" or something like that.
Yeah...God Bless them...they don't want to see that the sun is already setting on that nice little place they remember from their childhood...
Glory days...
Thanks, EB
It is still the 1950's-----never changed----never gonna change
My Ma in Law thinks I'm the biggest idiot to walk the face of the earth for stockpiling food.
I'm saving the special grey-meat for her treats later.
My folks have the hands clamped to thier ears yelling I CANT HEAR YOU LALALALA while you bitch about 9.70 coffee versus 4.50 a year ago.
Start talking to them about the $6 silver you own and watch the eyes roll.
Much more fun.
24 big cans of coffee
out the shed ...check..
2 acres of coffee trees. check
Sad, I have the same issues with my sister refusing to listen and wake up. I feel pity. "I let them wallow in their ignorance"
I sat carefully through the entire Obama Speech and questions.
I turned off the teevee with a migraine and a need for some motion sickness medicine because the words are so... plentiful in bulk but never really saying anything.
There isnt any more plans to attend such a wasteful speech in the future over something that will happen one way or the other. What can I... as a nobody do about it?
I personally feel that the entire 4 years of his Presidency will be a story of Medoricity followed by a high light speech consisting of three words "We got Him."
How does one sit carefully?? Milestones
So Moses... will congress keep the debt ceiling where it is?
Do you believe globalization is good for average workers?
We have been globilized for years and decades.
And the debt ceiling will be raised at the 59th minute in the last hour by a weeping, tearful congress announcing just how much they regret taking such a step.
They will blindfold the pro temp speaker as he calls for a aye, nay vote. 10 People all freshmen will roar AYE into amps while the Nays are sprouted by the sick but still serving members.
Ayes have it, gavel bangs. Senate follows moments later followed by a autobot sign machine carted to the room for that occasion.
As long as the People keep in mind that Since 2008 we have blown through enough money to support the entire western free world since the time Christ was Born.
There's a book out there called Unintended Consquences by John Ross. Quite a read.
It's those dam speculators that got us in this mess. They probably had
something to do with global warming and the earthquake in Japan too.
I realized today on my now third month of funemployment, that I am actually much smarter than the average bear. I have to take the Compass placement for mathematics tomorrow and based on the little bit (2 weeks) of pre-studying preparations, my math skills far exceed the ones running Spain or any other country in the world that is in dire fiscal triage. I feel much better now, actually the best that I have felt in weeks knowing my basic math skills apparently far exceed TPTB. How can Spain be off double their projected deficit? They get a Zero in my book and even though I have never been strong in math, I have yet to get a zero on a Math exam...even 20 years out of school.
I used to think that I was smarter than the average bear - as I've aged, I realize now that I'm barely smarter than the average picnic basket...
Good chuckle! From the 40's , 50's , 60's--------------Wow!; Time flies while you're having fun!! MIlestones
That may be true, but that is not the "qualificatin" they want. Then need liars, spinners and corrupt dishonest people.
You obviously have a big problem, because you can think, anc add, and apparently are honorable and try to tell the truth.
Good luck with that!
Me too Expected, me too. Popcorn ...check!
If we don't let the rich people have the lowest tax rates they might leave?
Let them fucking go then! They aren't creating jobs or paying enough taxes, so let some other country put up with their bullshit.
Think of the break-even mathematics of the top 1% leaving-
If you are not one of the top 1%, and you think you they should be paying higher taxes, and you think you shouldn't be paying higher taxes, and you don't care if they leave, then you are careless or stupid.
"The “Heart” act of 2008 (a bill whose main intent was to increase benefits for veterans and families of deceased military members) included for the first time an “exit tax” on American citizens who renounce their citizenship. The law passed Congress by a unanimous vote."
You may want to do a little homework before you start calling other posters "careless or stupid"........
http://www.renunciationguide.com/Exit-Tax-on-Renunciants.html