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Putting The Cart On Top Of The Horse, Or Why Heaping Fiscal "Stimulus" Upon "Stimulus" Is Suicide For America
Every time someone mentions fiscal stimulus (and specifically the failure thereof), the conversation, after repeated empirical demonstrations that said stimulus virtually always ends in tears, will veer to the Economics 101 textbook definition of the savings-investment identity, in which Investment = Private Saving + Government Saving + Current Account (the simplistic argument goes that a surge in Government Savings, i.e. austerity, means a plunge in net investment as the private sector is unable to step up), which more than anything, seeks to provide the last possible goalseeked explanation of why Keynesian assumptions still work in post-modern monetary environments, in which monetary policy has passed into the twilight zone of global central planning (i.e., money printing is rampant and thus textbook definitions of "savings" in a ZIRP environment are completely irrelevant). The irony, as so often happens, is that those who invoke this identity (which John Hussman has done a very admirable explanation of here) mix apples and oranges, and use, incorrectly, a monetary flow concept to explain what is fundamentally a production efficiency and labor (and post facto: consumption) phenomenon. That many of said proponents also make the gross mistake in assuming that in some perverse post-Keynesian universe a reserve currency issuer (however temporary, because there is no such thing as permanent reserve) can issue an infinite amount of debt, which by implication would result in the grotesque lim interest rate=0 as debt issuance ->infinity is inconsequential: this may work in a black box vacuum, but most certainly does not work in a globalized world in which currency, and yes, binary reserve status (consisting of 1s and 0s), is fungible with a keystroke (ref: the historic August 22 start of Renminbi futures trading which the CME today disclosed the margin requirements for). What this lengthy preamble tries to say is that feeding the government monster is, contrary to what Krugman and other Keynesians will tell you, in the current regime of coincident monetary irrigation, an exercise in futility. Perhaps nobody does a better job to explain said futility than Bill Buckler in his latest edition of The Privateer, which we urge everyone, and most certainly the POTUS who just requested more fiscal stimulus, to read in order to take a step back from theoretical, and wrong, textbook formulations and to see the stimulus forest for the burning trees.
Putting The Cart On Top Of The Horse:
For a human lifetime, since the 1930s in the US and across the developed world, the health and “growth” of an economy has been “measured” by how much has been consumed. Part of this consumption, it is true, is the natural result of prior production. But over the decades, an increasing proportion of it has been done by means of borrowed money. Worse still, the calculations of economic “growth” have included consumption by government. Government, by its nature, produces NOTHING. Any government, even one which is limited to protecting life and property and issues no debt whatsoever, is a cost on the economy. The fact that this cost is necessary does not negate the fact that it is a cost.
It is one thing to measure this cost in terms of money. It is another thing entirely to measure it in terms of the real wealth which has been consumed by government. The ONLY way to increase the wealth of an individual or a nation of individuals is to produce MORE than is consumed. The difference - which is SAVINGS - can then be used to produce more real wealth with more efficient means and thus less real effort. This is the only way that an economy can genuinely “grow”. This is what transformed the US from an all but untouched potential into a continent-girdling economic powerhouse. It was not done by means of currency manipulation. It was not done by means of government borrowing. It was not done by all encompassing rules and regulations. It was done by means of political AND economic freedom.
It cannot be done in any other way. Increasing the units of the medium of exchange will NOT do it. Increasing the debt burden on generations to come will not do it. These things will do the opposite. They will and have inexorably led to capital consumption. The results of capital consumption are visible all over the world today - but in few places is the evidence more stark and obvious than it is in the US.
The century-long experiment of putting the cart on top of the horse has all but killed the horse. There is no way that the genuine productive capacity of the US economy can keep up with the government’s stampede into unrepayable debt. In reality, the US government has destroyed the productive capacity of its people. If they refuse to realise it - the economy and the markets will do it for them.
That process began on August 4 when US stock markets had their worst tumble since February 2009.
When all the wooden philosophers, tenured academics, ivy league economists and constitutional lawyers understand the message in these 5 simple paragraphs, then, and only then, can America maybe resume its way to prior greatness.
Until then, we are merely digging our way out of very deep hole, increasingly "faster" and "faster."
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The first thing this lady does is defend 'defense' spending. I am not disputing her claim that entitlement programs are a serious issue but wtf is it with everyone giving 'defense' a blank cheque of support?
Cuts across the mother fuckin board!
Because a large portion of "defense" spending is in fact corporate welfare: private contractors and security firms have multiplied around the DC area to feed at the trough. And taking after Mary Meeker's theme, the purchase of their product is never up for public review or commentary.
Same story as always: insiders and cronies get nearly unlimited support, unquestioned access to 'sacrosanct' public funds. But when Granny asks for some of her own money back from SS, there's a hue and a cry of foul.
Don't be fooled by numbers, at the root it's all political.
go granny GO Beach Boys - (It's The) Little Old Lady From Pasadena - YouTube
gold $1786.17...silver $40.08
houston, do we have freaking ingnition, or not????? L0L! Ohhhh NoooooOOOO0000! Jan and Dean - Dead Man's Curve - YouTube [where james dean had 1 very fatal spin-out]
I got a chuckle out of the statement about the founding fathers surprise at the debt. I bet they would be surprised at alot of things. I always had this fantasy of showing someone from 200 years in the past around the neighborhood, and taking them for a ride on the freeway!
Regarding the amount of govt. spending on healthcare. The govt pays less to the providers, so they bill the private insurers. And PRIVATE INSURERS are the way to control costs??!!
Medical costs have inflated over the years as a result of the ability of the customer to pay. And we would not have made the huge strides in medical practice if the customer could NOT pay.
gh
i'm no expert, but as far as the gross income and sales of the medical profession and community, as well as tax deferentialism, corporate pass-thru and deducting leased BMWs and interest thru the pass-thru, please don't disregard the power of the lobby known as The American Medical Assn
if it weren't for malpractice insurance, all the surgeons would be fabulously wealthy. just ask them. and yet, at the same time, the doctors of medicine insist on enforcing their own strict and unforgiving standards for malpractice upon the states' licensing rights to "practice"
these people went to school for so many years, how tf can any mortal being question anything they want, say, or do?
Zorba, excellent! On any level that is called BANKRUPTCY. Wow, TD, that is gonna make for some insomnia reading material. Excellent and scary, but thorough indeed. Anyhoo, it's still called BANKRUPTCY
What part of this don't you people get??? The guy says "Investment = Private Saving + Government Saving + Current Account." True if and only if the government isn't borowing large amounts of money to fund wars. So what the man proposes is that we all go live in his fantasy world where the United States is not struggling with everything the elites have to maintain their world hedgemony. This is also the same reason why the mention of Ron Paul's name is Verbotten. He is against the continuation of the empire and speaks of it openly.
CURRENT ACCOUNT. Don't forget that!
gh
The US shot its load on the Banks! Anymore debt generated spending to stimulate the US corpse will only lead to dollar and country destruction.
Here is an elegant little solution to the Euro crisis i just read - the Euro ponzi could be about to do a Jesus Christ and rise from the dead...which could make that gold bubble seem at least temporarily plausible.
http://www.ft.com/cms/s/0/d64f5702-c768-11e0-9cac-00144feabdc0.html
The commentary to the article is hilarious.
All i worry about is that they keep those Euro pairs floating, if they stay up for another few years, then im a happy man.
“Mr. Obama said in Iowa that when Congress returns from recess in September he will put forward 'a very specific plan to boost the economy, to create jobs, and to control our deficit…'” WSJ
“In reality, the US government has destroyed the productive capacity of its people…” The Privateer
Neither the President nor the Congress intends to solve the U.S. unemployment and wealth production problem that is contributing to the sag of the American economy. Else why would they have created the problem? For created it they did – in collusion with U.S. multinational corporations.
Since China joined the World Trade Organization (WTO ) in 2001, the United States has lost an average of 50,000 manufacturing jobs per month. In addition, according to Gordon T. Long, 46,000 factories were transferred from the U.S. to Asia over the same 10 year period.
50,000 jobs lost per month! 50,000 jobs lost per month!! And continuing... 46,000 manufacturing facilities closed permanently!!! Within 10 years!!!!
Trade Newswire reported on April 28, 2011: According to the U.S. Commerce Department, U.S. multinational corporations added 2.4 million new jobs overseas during the first decade of this century. But during that same time frame U.S. multinational corporations cut a total of 2.9 million jobs inside the United States…
“Ten years ago, the U.S. economy was three times as large as the Chinese economy. At the turn of the century the United States accounted for well over 20 per cent of global GDP and China accounted for significantly less than 10 per cent of global GDP. But since that time our share of global GDP has been steadily declining and China’s share has been steadily rising…”
Accidental? Absolutely not!
It’s the deliberate bankruptcy of the United States of America created by manipulative false leaders who cover their totalitarian solutions in a fog of double-talk. It’s the deliberate takedown of America’s free enterprise supply and demand economy, to be replaced with the economic subjugation of all mankind via socialism – all laid out at the 1944 Bretton Woods (NH) International Monetary Conference.
We could have used those disinflationary years since WTO/China to our benefit by keeping our interest rates high and slowing consumption with higher taxes. Then we would have our "entitlements" paid off. We could have had all those chinese working for low wages, and kept them off guard by restricting our appetite for those imports. THAT would have been the way to conduct our economic colonialism, but we didn't have the backbone to see it through by our lack of self-discipline and frugality.
Did you vote for those candidates that wanted to raise taxes to balance the budget? LOL!
gh
And the govt. is the head on our body. Now that we are in trouble, we want to shoot ourself in the head!!
gh
Why take more money from the people to give to the government to do the consuming while Big Government self-perpetuates itself by building an economic control over the nation, at the same time arranging for the economic impoverishment of the people? Government and nationald debt do not create jobs; industry and the people do… That’s what a productive private market economy is all about.
I agree with Ron Paul that “the problem is runaway government spending, not the American people having too much money.”
Here’s how Paul put it today in S&P States the Obvious: “Politicians did not get much time to pat themselves on the back for supposedly rescuing the economy with the debt limit deal last week. The ink was barely dry when Standard & Poor's downgraded the US debt ratings anyway, roiling world financial markets. Anyone who has taken an honest look at the government's fiscal situation, taken into account how Washington works and the direction it is going would have a very difficult time arguing with S&P's decision, although a strong case can be made that this was too incremental a downgrade and that it took far too long for S&P to admit the obvious.
"Nonetheless, the administration nitpicked over a $2 trillion 'mistake.' S&P rejoined with the fact that $2 trillion here or there hardly makes a difference in the time frame under discussion. That, if nothing else, should tell you the magnitude of the problem. $2 trillion has become a drop in the bucket.
" S&P cited Congress's inability to act like grownups and make necessary, meaningful cuts, which is true. I must take issue however, with their suggestion that tax increases are part of the answer. Taking capital out of the private sector, where it can create real value in the form of new jobs and products, and instead giving it to Washington to waste and squander is not the solution. Tax increases may seem penny-wise to some, but in reality they would be very pound-foolish. The government currently takes in $2.2 trillion in taxes per year, which is far too much already. It spends $3.7 trillion, which is ridiculous and criminal. The problem is runaway government spending, not the American people having too much money…” August 17, 2011
http://lewrockwell.com/paul/paul759.html
Our nation faced one simple choice.
Either force bondholders to eat their bad bets or force everyone else to suffer through years of inflation and poverty.
We know the choice that was made.
What we don't know is how long it will be before social unrest takes hold.
I see social unrest taking hold after Step 1 and prior to Step 3.
Step 1.) The people will move from one leader to the next in search of a savior who will promise them anything, deliver to them nothing, and take from them everything. He or she will take everything because as the people get weaker they will become more desperate. And in their desperation they will waive any right or dream for any small semblance of security.
Step 2,) Once leadership fails to deliver, those that fight will get a swift and stern response from their elected officials. Much like in the UK and Greece, the poor will be held to a strict moral code and they will be told to suffer in silence.
Step 3.) Everything not nailed down (or defended) will be looted not by the poor but buy the powerful.
You said it. This isn't Keynesianism any more than what was before was capitalism. It's all rigged to transfer wealth. The banks should have been left to fail, a temporary lending structure put in place, and a liquidation. Massive shock, yes. That's when you launch a massive infrastructure program while the price discovery happens. But of course that's not going to happen, because the elites will be the last to suffer, and it's going to get a lot worse for grandma before LVMH feels any pain.
Tyler, unfortunately you've missed the boat big time with this one. While this post makes some good points in its criticism of Keynesian economics, on a more fundamental level, it is just soooo soooo wrong, and ironically, extremely hypocritical.
I encourage all economic theorists, both Keynesian and Austrian, to step outside their comfort zone of charts and theories, and put a little effort into understanding how the REAL WORLD works. They might find it highly illuminating.
"When all the wooden philosophers, tenured academics, ivy league economists and constitutional lawyers understand the message in these 5 simple paragraphs, then, and only then, can America maybe resume its way to prior greatness."
Do you not realize that you too are one of those wooden philosophers, just of a different tree?
You and your guest state:
"Government, by its nature, produces NOTHING. Any government, even one which is limited to protecting life and property and issues no debt whatsoever, is a cost on the economy."
and, "the US government has destroyed the productive capacity of its people."
Not really. The mistake you are making is in assuming that labour has productivity. That is incorrect. People produce absolutely nothing. People consume. This is the fundamental misunderstanding that all Austrians share, because they believe that private enterprise and people can, if left to their own devices, "produce" things and thus contribute to an economy based on free and efficient trade. Conversely, government, through taxation, stifles that "productivity" and therefore is a drag on the productive capacity of the economy. This is false. Tyler, you are arguing for the existence of perpetual motion machines, which of course do not exist outside of Austrian or Keynsian imaginary thought experiments. You seem like a pretty straight shooting guy; I'd hope that you would be able to understand this.
It is false because of the critical fact that all economists miss -- that only plants can produce. It might sound like hippie talk, but it is not. Every single thing that our economies "produce" was actually produced by the natural world, and most of that by plants via photosynthesis. All we do is take and transform that which plants produce and then turn that into other things that we then trade in our economies.
Therefore, it can be seen that a real definition of what parts of our economy "produce" things is those which protect and enhance the ability of the natural world to continue to produce goods sustainably -- food, energy, and minerals.
And using this lens, it becomes apparent that private eneterprise can do great damage to economic productivity when it destroys the environemnt through lax government regulation (eg overfishing for a classic example). So, despite what this post says, government is not necessarily in any way a drain on productivity. Only government that serves its corporate masters (oil and finance) rather than the people who elect it, and that does not take care of the environment that it is charged with, is a government that is a drag on economic productivity.
I have explained these issues in much greater detail in my link below, and I'll excerpt a portion of it here:
http://markbc.wordpress.com/thermodynamics-for-economists/
"Believe it or not, but virtually everything that exists in any economics textbook (including the one referenced above) which is based on the premise that labour “produces” things … is false. Here’s a challenge — name one thing that labour produces. Anything. You can probably think of many things. Now take any one of those things and analyze how labour actually “produced” it to begin with. You will see that in every case, labour needed more things to make that product, than that end product contains, in terms of energy and raw materials that had to be taken from the natural world. I guarantee it, 100%. There’s that pesky second law of thermodynamics popping up again.
Here are some things that we humans actually produce:
That’s about it for physical things. Do any of those have economic value? The only one which does is forces made by our muscles. Therefore, this is what labour “produces”. We produce services, not goods. The planet is what produces goods. All we do is take and transform those goods (minerals and energy) into something else which we call economic goods, and we do this within the bounds of the laws of thermodynamics. We don’t even really “produce” services either, because we had to eat energy first in order to be able to move our muscles. Therefore, from here on out, if I ever say that labour or our economy has “productivity”, I use that term loosely and you should know why. Some other less tangible things you could also say we produce:
Mark,
Excellent post!
I continue to believe that the woes of this country are not caused by govt policy, but by lack of effective govt policy. Our current account deficit is how the wealth we have created out of our natural resources leaves the country. If we elected and expected our govt to incentivize energy conservation and to promote less consumption, and more savings, whether public or private makes no difference, as it is only in the distribution that matters, we would not have the financial problems that beset US today.
gh
Thanks sellstop! Totally agree. One thing that seems ridiculous to me is the widespread idea that the way to help the economy is to stimulate consumption, to buy more things (which the above article correctly points out is false). This makes absolutely no sense. If the economy is completely 100% supported by the natural world which produces the things we consume in our economy, then how can depleting those resources be good for the economy? Only in a ponzi scheme economy like the one we are curently suffering through could this be the case.
I also totally agree that it is in the distribution that matters. I actually think that the government could and should be significantly larger than it is (but of course, not within the current economic system of spiraling debt and government spending). This is for two reasons: one, to employ people to protect the environment, to pick up garbage and enhance fish stocks, etc etc. Two, we need to find work for the people that are currently unemployed because the economy is no longer gorwing, and likely never will again due to resource constraints. All those previous construction workers are going to be unuemployed, and need a job. Otherwise, the work week will have to shortened to spread the remaining work around more. Probably a bit of both is required -- increase government, and decrease the work week.
If the government printed its own money then the problem of government debt would by definition instantly vanish. People could use gold, silver, or government fiat money, whatever they want, for money ( for transactions and / or for storage of wealth).
When people criticize government, they really need to be careful and realize that our governments are nothing but puppets for the big boys -- the banks and the oil and coal industries that control them. Once we get rid of the banks, then government can once again be accountable to the people, and I believe that central banking should be explicitly banned in the constitution to prevent this situation from ever happening again. I hope someone will have the guts to do that after the collapse. Getting rid of the oil industry manipulation is going to be a little tougher though.
Excellent post and points Mark. i like the way you think. A kindred spirit in deed and word.
ORI
i don't like the way he thinks, ORI. why not? b/c much as humans DO produce these things:
they also produce tools, baskets, and shelter, and carve flutes lutes, and straws for toots.
no, humans are not at the top of the scale of BEing, but messers durden and buckler do NOT seem to slewie to be discussing labor and its sacred poo-poo, altho the word "labor" is used: once by tyler in the orig intro, nunce in the buckler paste; and nunce by tyler in #1567821 for a grand total of once, and as an example of an error in thought, or something, by t.d.
if ya ask me, they are speaking, broadly, of production, public/private, and wealth.
so to say they are talking about labor is a bit disingenuous, to me. a cheap shot, really. yes people produce pollution, too, or is that something india is gonna deal with after they straighten out everybody's heart after centuries of shitheaded thought based on some "authority's" ability to say you are "attached" to something, and therefore not thinking straight? of course you are attached to the maya of your own 'self' but the fact that you may have heard about that and joe didn't or something doesn't mean that a) joe is wrong all the time, or b) you get to make up shit that doesn't apply to what is actually being said, by people here.
tyler is talking about liquidation of insolvent enterprises in #1567821 after, above, the definitional moronicism involved in "reserves" for fiat and possibly also "backed currencies" mutatis mutandis, not sure and don't want to put words into the mouths of two people here, (d & b) who seem much more able to speak for themselves that you two shitheaded morons, especially the one to whom this is addressed.
as always, the "what he said" & "feels good" fall short of zH crieria for discussion. please be advised. ORI, you do this shit all day long @ http://aadivaahan.wordpress.com/2011/08/16/pre-cursor-2-and-currents/ why do it here? you can do better. i wish you would.
yes, we fail at circumscribing "reality" with words and symbols, ok? given that, imho, all you guys are demonstrating is that you have not understood what tyler is trying to get toward, here, and that this isn't perfect, so let's take it down. wow. nice!
which i think is kinda too bad, b/c he seems to have worked quite hard at trying to get it to you and your kindred spirit in deed and word, mark, who seems to have responded with a "download" of a rant about "labor" which is neither relevant nor honest. just b/c some people choose to worship the "buddha nature" of a dog, does not make human nature somehow less than or = to the object of their idolatry, ontologically. unless, of course, it does. right? if you and mark have a warped and erroneous view of the innate, essential dignity and place of human nature, especially your own, please do not project it onto others, if you can begin to help yourselves, at this point. thanks, guys!
oh well, shit happens. if you actually think that mark has succeeded in showing how: Tyler, unfortunately you've missed the boat big time with this one, perhaps you should keep working at your own website, because the artistic sophistry of making an argument which is N/A and not noticing it is pitiable, indeed, in spite of (or perhaps even b/c of) the fact that i can relate to that, no sweat.
as always, dear ORI, please feel free to respond directly if you wish...
You're in desperate need to see Milton Friedman describe what a little miracle it is just to make a simple pencil: ?Power of the Market - The Pencil? - YouTube
"The butcher, the baker, and the beer maker don't do what they do so you can eat, they do what they do so they can eat." --Unknown, describing how the invisible hands in a free market system produces things for others whiile working in their own self interest.
The lifework of the average person each produces $2 million worth of goods for society, while their consumption is considerably less. Higher college degrees have higher lifework earnings. Career criminals each take away an average negative $2 million in lifework earnings from societal productivity. Perhaps we just have too many criminals working in Washington to balance the budget.
"Marxism never sleeps..... so I carry lots of valium." -- Unknown freemarketer
First let me say I can not argue with the basic premise of what it is you have stated. It was clear and concise and simple enough for my daughter to understand.
I am curious to know the term you use for turning minerals in the ground that alone have no use or value and taking human energy and turning them into something useful. I was under the assumption that was what was implied when someone says productivity. It is true that humans don't create the parts needed to make a concrete mixture but to imply that humans do not increase the value in regards to the materials they started with is quite silly. Maybe you didn't intend on implying that. Maybe you just felt the need to state given knowledge that even Krugman or Obama could understand. That being man does not create things out of thin air.
If that was your intention I congratulate you on elaborating on something we all already knew. If it was not your intention than was your intention to make yourself seem smarter than any other person who has ever lived by explaining the inferred meaning of a word commonly used is not correct?
I am just curious as to what natural occurring phenomenon turned these innocuous minerals and materials into this iPad I am currently typing on. Without human productivity (in the sense of taking useless materials in and of themselves and turning them into so ething that allows me to ask you for the 1 minute of time in my life back after having wasted it reading you illustrate we are humans who expel energy to transform useless shit into useful shit and the course of doing so we have always termed productivity and you seem he'll bent on making a new word for it. So please enlighten as to which word you would prefer us to use so we can stop future readers from wasting their time reading your useless and pointless expansion on common thought.
Not trying to be an ass but I couldn't resist because I can tell you believe you deserve a Nobel prize or some shit for drawing out a detailed explanation that could have been more easily summed up by just saying something like I don't know
WE AIN'T WIZARDS BITCHEZZZ
What a great response, thanks for doing that.
Let me also state emphatically that the level of intelligence on this website has dropped in direct proportion to the rise in popularity of said website. When I started reading here I loved the articles for news and the debates underneath for all sorts of angles and methods to discern the news. It seems that intelligent debate has been replaced with racist rants and a bunch of people who have nothing worthwhile to say but seem to think posting their 4 sentences of worthless blabber on a website somehow makes them smarter than the economists they ridicule even though die be willing to admit less than 10% of current posters have ever read Keynes general theory or hayeks road to serfdom let alone non famous treaties and papers from less known economists.
My only point is it seems to me that as more and more people post stupid useless crap the less we get intelligent postings. The debate that used to take place under tylers articles was often just as informative and important as the articles themselves.
I never posted much because I rarely felt I had much to offer or add to the conversation. It now seems that myself trav and cd and ori and a few others must pick up the slack from all those who have left or who have quit posting.
I will finish by saying that I do agree that buying and holding copper, silver or even toilet paper you will see said asset wealth rise with inevitable inflation we will continue to see into the indefinite future not one of those 3 things will make you rich. I know a lot say they don't buy silver to be rich but to hedge their future of a devaluing dollar but that is complete crap. CB's own gold and regular people own silver. Guess which one those who control the price of each are going make sure is worth the most.
Man plans and god laughs
Arab proverb
Let me also state emphatically that the level of intelligence on this website has dropped in direct proportion to the rise in popularity of said website.
ok, as long as we can also allow that you are, essentially, speaking of yourself, you viscious, little cunt.
"I never posted much because I rarely felt I had much to offer or add to the conversation."
OK. I get that. Is your addition to or discssion of the post that if we all buy toilet paper, copper and silver we'll all be rich? Just curious. Also, consider this my ignorant post without ever having read "Keynes general theory or hayeks road to serfdom let alone non famous treaties and papers from less known economists".
I'm just one of those ignorant mud hut dwellers that owns their hut and is self sufficient in life. While my reading list may not be on your approved list I would venture that it is quite expansive. Pehaps that's why I enjoy this site. Many opposing viewpoints from all walks. Kind of leads to that most dangerous of diseases that you don't suffer from.... critical thinking.
Great post. Plato would have loved you! You take us back to the beginning of things. That's where we should be now collectively, as the production/productivity "fallacy" is made clear to all by Peak Oil etc.
You are very wrong. Humans produce many things which is easliy provable by the fact that humans change one form of capital, like a resource, into another, like a finished product. To believe plants are the only organisms that produce things is laughable as plants require resources and energy from the sun in order to produce anything, in your own view that would make plants simply consumers and unproductive.
As a matter of fact the way you describe productivity everything in known existence would be unproductive and simply consuming, if that were the case we would not be here nor the rest of existence. I suggest you rethink what it is you are trying to imply. What we mean by the government produces nothing is that it adds no value into the market place. Or rather it adds an unknown value, because after all it is valuable to have rule of law that enforces contracts to ease the flow of commerce. I think however that most people would agree that beyond that basic function, which is impossible to determine the value of, government does not add value, so anything beyond court systems, law enforcement and national defense are a drain on society.
Name one thing my tomato plant produces. Anything. You can probably think of one thing. Now take that one thing and analyze how its metabolic processes actually "produced" it to begin with. See what I did thar?
You will see that in every metabolic process, the chemical reactions needed more things to make the end product, than that end product contains, in terms of energy and raw materials that had to be taken from the natural world. I guarantee it, 100%
The Sun is your God. Bow before its mighty productive illumination!
So, which blade of the scissors does the cutting?
“Let the bankers have their gold, silver is for revolutionaries.”
www.silverrevolucion.com
Spending is not GDP. Spending borrowed money is certainly not GDP. Selling financial paper is not GDP.
America's true GDP is about -5%. The true productive economy is shrinking about 5% a year.
But the money supply is growing about 10% a year (then 15% when full blown QE starts back up).
-5% GDP with 10% money supply growth = 15% inflation.
And thats about what we're seeing. 15% loss of dollar purchasing power each year. 15% rise in prices each year.
... except real estate. Real estate demand is collapsing about 20% a year. With 10% money supply growth you get net 10% drop in real estate prices, about what we're seeing.
http://www.amazon.com/Ecotechnic-Future-Envisioning-Post-Peak-World/dp/0...
Hey guys - as long as we are talking about the post-peak world, this is a very interesting book from John Michael Greer. He happens also to be head of an order of American Druids (can't wait to join) -
As we transition from the geological equivalent of sugar (oil) and obesity (hyperinflation) we need to kinda focus on home economics and quality of our daily lives and interactions
well said & agreed, though there is another place to buy the book for those who are not interested in further fattening the bloated pockets of Jeff Bezos:
http://www.newsociety.com/Books/E/The-Ecotechnic-Future
yes, it's $6 more, but i'd be willing to buy anyone that buys it here a beer to make up for it. just remember, Amazon.com is not your friend, no matter how much they try to seduce you that they are with the Super Saver Shipping.
The USA has created a shit load of new weath over the last 30 years. A large majority of it has gone to the top 10%, while the 17% at the bottom are on Food Stamps.
Labor has had nothing added to its hourly rate for the last 40 years. It has all gone to CxO pay and corporate profits.
So who really needs more economic growth when hardly any of the new wealth goes to ordinary Americans? Corporate profits become maximal, yet corporations do not employ more labour or raise hourly worker earnings.
It's a scam. Gubbermint has got to be about building society not about 'building wealth'.
what you say is not unreasonable, at least to me
IF goobermint is NOT about "building wealth" who is, or should be? and, how does said wealth relate to/ dovetail with "building society" if at all?
in political science, there is the sticky little wicket of "rewards and deprivations" among/betwixt/between different "interests" in the "society" or if this has also been somehow magically changed by the postmodern confusion, please advise
what does "building society" have to say about people's wealth and who gets what, and who or what is the "final" arbiter of such old-fashioned, meaningless bullshit-thought?
Wealth has always been one measure of success in society. But just as important: the qualities of learning, of leadership, of civic duty, of generosity and compassion.
Since that nuance has collapsed down to just wealth and consumption, the metrics of life have been simplified to promote a two dimensional culture in society.
"what does "building society" have to say about people's wealth and who gets what, and who or what is the "final" arbiter of such old-fashioned, meaningless bullshit-thought? "
The wealth (capital) of the commons has got to be recognised, valued and built up. "Who gets what" should be determined by individual need, hard work and talent. Yet a day in a working man's life can never be 100x more valuable or important to society than that of another working man's day. So the system of pay, recognition and rewards should reflect that. Who is the final arbiter than? The mechanisms, rules and regulations that society chooses use in order to reflect its values.
yes, and well said, as usual
values come in very small packages, really, don't they? and yet they "distort" everything, being both somewhat emotional and also quite learned, in general
so the post-modernism of bottom-up "evolution" due to its "lawful" place in that "reality" stands against a "top-down" metaphysic of conditioned value systems?
yes and no, i think. yes, in the obvious sense: maybe that's kinda where we're at.
no, in that the system of values, like "the kingdom" from which they must be gleaned, are within you?
or what?
maybe the "opposite" of evolution is neither devolution nor "creation"
maybe the opposite of "evolve" = create! who knows?
A lot depend on how much someone bothers to listen to their conscience; also their capability for self-deception. I know people who rank both very poorly on the former and very highly on the latter: scary individuals those.
i know. and where many teach that conscience is by "nature" pure, others point out that our experience of it can also be "conditioned" and if we do not realize that, we are merely "listening" to a recording someone downloaded into our "minds" which is where we started. no words can save us.
to me, that is just the way it is; my fears? i guess that those who see where "evolution" is taking us become so freaking hopeless that they are incapable of thinking creatively about all the fun we are having, or how the fuk we break outa the slammer, here.
i'm not saying we can do it, just that i'd sure like to try. wouldn't you?
"So who really needs more economic growth when hardly any of the new wealth goes to ordinary Americans?"
Well at least the ordinary American can share in the externalities of growth; crowded highways and neighborhoods, pollution, etc.
Eat your peas.
edit. found it.
if anyone has savings then they aint being taxed hard enough
Zero Hedge blasphemers! I'm just, I'm not going to take this anymore.
Everyone needs to understand that supply-side issues, the whole gamut of them, canot be solved with supply side answers of production/consumption, value-creation and the rest.
While some feel deep discomfiture at the thought, this entire kit and kaboodle has to come down. The only question is this, can we do it without crashing, booming, pain and general dislocation, or can we apply genuine in-genuity to the issue at hand?
I'll re-iterate my support for what Mark from BC has said above, at least broadly. To think of the world we have "created" around us as some sort of crowning achievement and triumph of the human spirit is a faustian bargain.
The economic mess that everyone here spends endless key-strokes moaning about is fractally very much a part and parcel of the same system. End the FED eh? Well, end everything then. It's all linked-in. ;-0
This far into the game, you are better off knowing when the final whistle is going to blow and play accordingly. For some it is full steam ahead, for others it's just time to pull back. I hope we've chosen our sides well.
ORI
There's still 5 minutes of the game to go...and who knows we might get some overtime if the ref is gentle.
part of me want to ask how much you charge to take it up the ass
but i don't think i will...
You are way out. Debate is NOT diatribe...
that to which you are responding is neither, so let's just disagree, there, ok? unless you are not being disagreeable with that, which would not surprise me f_p
now, if you would like to debate me about anything i have said, here, please go ahead.
or, if not, i understand: why subject yourself to diatribe when you are way out, too? better to test; if he fails, then we know, for sure!
L0L
right, f_p_ma?
hahah
Done above : for content and substance. As for style...its beyond debate...it's just fate, or bad taste. Yor choice.
no, actually, those are your choices
trust me
whether you can glimpse this, or not, i'm discussing other choices and issues, here, from your infatuations, i am pretty damned sure, at this point. asswipe.
You say shit all in substance, though, sorry to point this out. You are just a pile of negative ad hominem play based on your self proclaimed sacred mantra "he who disagrees with me is ass wipe"...can't get more totalitarian in thinking than that. Go pray in your church. Alone.
i shall let otherz decide between us on substance. tyler knows what has been said, here, i wld imagine. at least 1/2 dozen other zHeads, and,...
and yield to you on your soaring "mirroring" posts which admit to the disageement here, as well as the disagreeableness, while failing to address it (the disagreement), in any substantive way, but oh, so "stylishly" by actually not missing the obvious: that we have stylistic differences, too, which apparently you pride yourself around. fine.
people who have read my copious and frequent rants may take issue with your conclusions, puddin-head.or, they may take your side, if they wish
i do not, usually, gratuitously insult people for disagreeing with slewie. even you, in the past, have gotten the nod from me for a point well made against me, or around me. as has ORI, and others here.
i have spent a lot of time and energy around two main themes, on this page, or i have tried:
1) the ideas, as broached in the given essay & tylerisms, re the productivity of the public sector: what does it grow, what does it mill, what does it bake? what does it mine, smelter, strengthen, and shape? does it "produce" security? for all, equally? or truly, for some, thru illusion for others?
2) the recurring and v. popular idea that thing & we are soooo screwed that there is no reason to reason. we shld understand our gestalt mythically, not rationally. my point, possibly even well-made, is we should strive for both types of insight and inderstanding, and possibly even one or two more. why not? too "blocked"?
the obvious fact that i am aggressive, interpersonally here, apparently leads some to simply see me flailing away, blindly, with blade or a club. the idea that i may also be tossing sharp, pointed, well-aimed dartz at others' "thought balloons" in writing, right here, simultaneously and in Real Time, well, that's something they may only see later, if at all. and, yes, the same to me too, ok?
over 8,000 views of what is here, falak. perhaps slewie is not so "alone" as you might, again, fantasize. so let them weigh what we have said about these themes, and decide between us. why not? what did slewie say re: 1)? what did falak say? about 2)? slewie v. falak. you might even try it, if you are able, now. not that there are only 2 subjects, here.
there is no shame or crime to being hopeless and depressed from time to time. i intuit you there, and i wasn't "kidding" or being facetiously "ad hominem" in that. many are "battered in BEing" by these days and events, and the near-incomprehensible gobbledy-goop coming from "authorities" and the double-speak nonsense we are asked to digest in order to perceive our world/gestalt. at my age, i trust myself in these perceptions, even tho they're not always accurate.
the "fact" that i am (hopefully) ready willing and able to beat the living shit outa you, logically and emotionally, here, does not mean i don't care about you, no matter how i perceive you. if you are down, you are not alone. but maybe you will get an inch away from that, as you continue to read along today, tomorrow, and so on. but only if i "guessed" right of course. i don't disagree that we are in a world of hurt, together, pretty much every zero who isn't just a polyanna is hurting through these madmad daze. i am no stranger to self-pity; hell, i'm not inhuman. but my type is optimistic. what can i do? i love this shit! it is fabulous for me! but not always, just in case you didn't know that, somehow. as i said elsewhere here, if we're locked down together, shit, man! let's bust out! and maybe we'd all stand a better chance at it if you and ORI and mark, and others, come to see it, somehow, as a worthwhile quest, no matter how slim our chances be. now, that may not be much, but it's not nothing, is it?
your ass is grass, toy-boy, no matter how you wipe. you failed to address the actual zH dialogue here, imho, while unfailingly flinching, as a coward, from the substance, you also unfailingly failed to perceive any "method to my madness" which, unfortunately, for you in this forum, i would opine, will be seen quite easily by others who are capable of thinking thru these themes, even if they don't see them my way. what more could i ask for? so be it.
amen.
hey, thanks, ORI
1) perhaps you need to understand that "consumption and value-creation" are not necessarily just "supply-side" issues. your sloganeering is appalling, sometimes.
2) I'll re-iterate my support for what Mark from BC has said above, at least broadly. To think of the world we have "created" around us as some sort of crowning achievement and triumph of the human spirit is a faustian bargain. again. the "unconscious" twist, in that, to me, mark did NOT say or even imply this, or anything coming close to the "faustian bargain" but if you want to pretend that now, so you can continue to "agree" with him, fine. suit yourself. again. i'll stipulate that we have immense delusions about ourselves and that we really do fart. will you agree that this doesn't say everything about the situ? jeeez!
3) if you both keep referring to your own websites, does this mean that what the fuk you shitheads say here doesn't matter?
4) this entire kit and kaboodle has to come down. yes, all the great cycles begin and end. the mountains will be washed to the sea, and blahblahfukingblah. yes, and if it happens now, you are right and others are wrong, which is also wonderful, apparently, for you. maybe it does. but b/c ORI sez so? really? has to come down? this entire kit and kaboodle. why? b/c everything is connected and you said "fractal"? you're entitled to your opinion, ORI, but that does not make you the ORI-cle of zeroHedge, dude. it just doesn't. maybe you are right. but b/c there is some dry rot in the bathroom, the whole house hasta come down? or, if the whole house is rotten, we need to raze the "hood? and so on. so, jesus is coming? or shiva? so what? we "move thru the zodiac" so therefore you must be right?
5) again ORI i would invite you to re-read what tyler and his essayist put here. please.
6) THIS is what mark said: Tyler, unfortunately you've missed the boat big time with this one. While this post makes some good points in its criticism of Keynesian economics, on a more fundamental level, it is just soooo soooo wrong, and ironically, extremely hypocritical.
7) you agreed with him, dude.
8) "you are better off knowing when the final whistle is going to blow and play accordingly" so please, 0 ORI-cle of zH, tell us when the "final whistle" is going to blow or else, according to your logic, we are "worse off"
9) you think we are "choosing sides" but we are really trying to share ideas about tyler's subject(s) here, are we not?
if i were to try to explain what i see happening, anal-ytically: you are trying to sound rational while responding with the emotional mind. you are caught up by the mythic dimension, as am i, "tyler" and many very cool people here. and, the emotional mind and its symbols and processes, its rapidity and surety of perception, can, hopefully, inform our joint endeavors, ok? but it is not a substitute for the human intellect, even tho without it, the intellect is totally insane: nebuchanezzar, the "mad king"; pharoah; the chairsatan; slewie; everybody. and yes, this "dualism" is itself incomplete.
so it is not that you are "wrong" to me, but that tyler is "right" and your "righteousness" does not encompass his intellection, here. my opinion. but that doesn't mean it is incorrect, does it?
again: please try to grok his point(s) and purpose, and the possible scope of what he is saying, if it is, indeed, there (up to you, isn't it?). this may not change your "feelings" about it, but you may find that with a little more effort of a certain kind to understand tyler here, even if you don't agree with him, you might begin to value what he has said here, almost in spite of yourself and not agree with mark, as to his extreme hypocricy, if you catch my drift.
oh 1 question, should i buy gold or silver?
silver ... check this .. http://dont-tread-on.me/money-banksters-and-august-2011-%E2%80%93-the-co...
"Let the banksters have their gold, silver is for revolutionaries!"
The economic collapse is being done on PURPOSE!
Meanwhile Obama is warning of a terror attack on 9/11!
http://theintelhub.com/2011/08/17/obama-warns-of-norway-style-lone-wolf-...
Ocean Algae anyone? Renewables are what makes the world go round. Man will never match nature's innovative genius. All we can do is nurture it. Or perish. Consumption/ Thermodynamic's sword of Damocles/Entropy as time's arrow, its final masterpiece.
And the natural circle recommences after each man-made fall.
right. we know.
and smurfs are blue; everybody knows that, too; but thank you for chiming in with those who think what tyler said here is irrelevant.
where do you stand, f_p? it sounds like on the "perish" team. b/c of consumption and "time's arrow" we are at a "final" man-made "fall" and then AFTER that, the "natural circle" will RE- commence! i sure hope we don't have the 2nd biggest false dichotomy of the day, here!
sweetheart, you and ocean algae belong together, tonight!
thank heavens for falak the s-s-s-seer perceiving that the circle wil "re-commence". doing what? being the "natural circle"?
well, nothing for you to do, forever, then, is there?
carry on, shithead!
where do I stand : I think I've posted enough on that. SHit head is more reflection of you mind set.
no. i am saying, precisely, that you are a shithead b/c of where you stand. shithead. i don't expect you to agree with me. everything seems to be required to be presented in terms of false dualities by you. yes. that is my perception; so, i'll actually own it (gasp) p.s.: i know i am a real shithead! where i = slewie
do you know what your head is doing? i honestly don't see that you do?
it may seem long ago, but as i recall, you jumped in here on me with a bunch of fuking weirdness about something which is of absolutely no concern to me, nor has 1 iota of substance as to what was being discussed, here.
am i wrong? i understand that this particulart string leads back to you, but, i am talking of your prior sortie, above.
after that bullshit, this bullshit is about your fuking bullshit in #1568191
and, yes, not only am i a shithead, you are a pudding-headed moronic asswipe of a fuking fool. and your mother is a whore, too!
any questions, einstein?
you evidently love talking to your mirror image. I'll leave you to it. Great soliloquy. You get an Oscar for it in my book.
you know, falak, i don't disagree that much "happens" and that it is often both beyond our control, and much bigger than one person, for sure, in scale.
i guess i object to the post-modern fatalism or whatever it is; accepting the "hopelessness" rather than struggling against it, and trying to infect others with that shit b/c "what else is there?"
if you were in a nice, wide river, placidly floating downstream, headed for a falls, the idea that it is hopeless to try to swim against the current to angle to the shore in time is pretty far out, really. especially when you can hear the fuking falls!
how long have you been depressed?
Ever since I saw Marilyn going down the "river of no return"...and then dying in Niagara falls...i've aways felt poetically despondent for not having tasted her peachy cheeks...as like most people 'I like it hot!', and it' not just 'A seven year itch'. I'm a stoic, and an epicurean, depending on the moment, so don't worry about my 'depression'; its more 'irrepressible lightness of being' often, alas, not enuff, fed on chardonnay. But next time you charter a boat for a trip down Niagara, keep in mind, a smile and a laugh and a good scrap at fight club, where we all AIM above the belt! Right? Irrespective of whats up ahead...
no, sir.
you are unfair, here, not me. don't throw a bunch of troll nonsense at me and then call it "good scrap". who tf do you think you're dealing with? not slewie, perhaps, you little shithead.
you are not up to this, toy boy. you belong somewhere else.
trust me.
But also pretty far out would be the notion that the sound of the falls was was an outdoor Justin Bieber concert and that maybe you ought to keep floating toward the sounds of Justin.
I just upped my Paxil from 7 1/2 to 10. Nice.
RE; Subject artifcle.
Garbage. Hopeless anal drivel. Should buy better wine.
no shit. who cares?
now, read what tyler has written, above and below. same verdict?
yes? no? choose one.
night-night (Au $1791; Ag $40)
What is up with these yahoo libertarians insisting that gov't produces nothing and is just a cost? So if the gov't collects the garbage nothing of value had been created. But if we privatize "sanitary engineering services" we've got some bonafied wealth creation happening! By true, non-parasitic patriots to boot!
The lack of basic logical thinking in these ZH forums beggars disbelief.
Generally the reference is to Federal goverment and the libertarian perspective is that centralized planning with lack of competition is always more costly, deprives people of rights and most likely reduces productive employment.
Are people's wages better employed passing through the IRS and through Congressional committees to be allocated through crony capitalism or to be directly employed for goods and services in a competitive environment????
My parents have a summer home on a lake. That area is served by at least two and maybe three garbage companies and people have a choice of which company to choose. The companies provide both regular weekly pick-up service and per bag service (stickers are purchased from local stores for a price and then put on each bag). People have a choice and none of the companies have gone out of business in the last 10 years.
Common sense and common law ... not some fascist oligarchy where money and cronyism determines who is protected and who is persecuted, as we have now. Get rid of the yellow fringe on the flag, FOREVER!!
Maybe if the president had to ask for donations from the people to support foreign wars of aggression and foreign military bases the world would be a better place for our children. Don't have any delusions that we attacked Iraq, Afghanistan, Pakistan, Libya, Somalia and Yemen (the last 4 are presidential dictated kinetic actions) because we are nice guys defending our homeland and the people want to be at war. Some BOZO at the top decided he wanted to do it to support some globalist agenda (such as putting Basel controlled central banks in every country of the world) and lied to create an environment where he could.
yes, it IS an extreme argument. PRODUCES nothing. please, pay attention.
what could possibly be the value of pushing it so hard?
to see where tf it stops being true might fit...hmmm...? some kinda a social contact about garbage collection? really?
1) what are the legitimate functions of goobermint?
2) what do they have to do with actually producing anything?
what if these questions need to be addressed, but trolls simply.will.not.permit.it. it's just too threatening! not to me. but i don't "work" for the goobermint! maybe the answer to 2 isn't "nothing". if so, what is the answer? everything?
are you sure tyler & buckler are completely screwed up, here? yep. well, good for you!
If your only goal or purpose was to create a global empire how would you go about it? I am sure the plans have morphed many times over the years and may do so again. However, given Zbignew Brzinski's statement that it is easier to kill a million people that control a million people (as if CONTROLLING is the solution at all), one can envision scenarios where certain assumptions would be made leading to our current situation.
JMHO, ALL of the moves made are for power and control and have nothing to do with anything else. Taken in that context they can make sense, even though they will most likely fail.
when I read this statement: Government, by its nature, produces NOTHING,
I kinda decides to ignore the concept of market failures and tragedy of the commons, which are all well researched. There are functions that would be done by private industry in theory, but why would that all of a sudden mean it is producing something. The government can provide health services, or private. What is the difference. If health and welfare, clean food, patent law, law enforcement, all provide economic benefit to society. All one has to do is look at somalia and places where there is no government to see they do very poorly economicly.
And therein lies the question. Do you want to live in a fascist nanny state that is built for the benefit of crony oligarchical capitalists and enslaves the majority of people to debt or welfare for their lives or would you prefer freedom and an environment where the benefit of people's labor went to them instead of bankers and crony politicians who parasiticlly decide how to divide other people's value adding work between themselves.
How much do you actually know about the condition, causes and implications of Somalia? Or, are you guessing or regurgitating something that you were once told by the globalist controlled mainstream media? Just asking.
again, even tho the "nothing" seems very emphatic and important, please try "produces" too.
do you think these people are advocating total destruction of government? or does it just "feel" that way? dude: "enforcing contracts" may not be quite the same as producing anything? and maybe the enforcement of contracts could be better done by fifth graders, at this point, throwing darts or using a migic 8 ball @ 1/25,000,000 th of the "cost". absurd?
i'm not entirely sure. but, perhaps these writers are trying to get at the idea that we need a centrally-planned system of everything? and this is what the fuking goobermint is s'posed to "produce"? b/c i don't think they would agree with that. offhand. do you really think that anything else = somalia? do you hear that you may be being warned that this fallacy is what is leading us to become more somalia-like?
too risky to change course? too much to "lose" by re-tailoring the damned goobermint at least to something we can afford, by cutting it back the criminality, waste, and militarism to where it isn't breaking us and causing perpetual crises?
if you don't understand what their point is, please stop trying to interpret it for people, ok?
i am guessing. that is my best guess. fuk all you shitheads and tyler durden & buckler too! it's good to be a pi-rat, BiCheZ!
Well what is the point of all of this goobermint hating? Do the writers feel there is a contingent of stubborn statists lurking on pages of zerohedge who can be hammered into submission with hysterical rhetoric about the total evil of gub'mint. Of course the rest of us know that they just mean that maybe a 90% marginal tax rate might be a wee bit to high. Hyuk hyuk
No point in priming the pump on a dry well.
"I am for a balanced budget;Do we need to change the constitution to do it? We haven't in years."
Fuhrer in 'The Situtation Room' with Zionist Wolf Blitzer 8.16.2011
http://youtu.be/UE9kvOnh2sc
http://youtu.be/AKdIlDz2erw
The Political theater move from the melodrama of the debt ceiling to pure comedy.