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30 October 2016

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Zed

No, as the joke goes, *dual* loyalty is an improvement.

MRW

@Tyler, darlin’,

“They want their gimmedats.”

Enough with the gimmedat sneers. Beneath you.

It is the federal government’s JOB to provide for the “general welfare” of the people. Read the fucken preamble to the Constitution. It’s right there in black & white; provide for the general welfare of the people.

The federal government does that by *buying* goods and services from the private sector, **creating jobs**. It doesn’t “spend,” it BUYS stuff from the private sector to provision itself. It does it through the aegis and power of Congress—again, a power reserved only to Congress through the Constitution—something Congress has neglected to do for the past 30 years, leaving it to the Federal Reserve to attempt to accomplish it thru monetary policy (its mandate) instead of using fiscal policy (Congress’ JOB).

Businesses do NOT create jobs. Businesses are sitting on $2 trillion of cash waiting for Households to get their income back to increase sales. Households account for 70% of all spending in this country. Businesses? Only 12-14%. If these households don’t have the income to buy plane tickets, hire gardeners, buy construction materials, hire tutors, employ architects, buy cars, feed their kids, buy gas, get a new frig or tv, whatever—what is called “goods and services’ in the dry language of accounting—then businesses are not going to invest in hiring more people. Why should they?

No businessman in his right mind would hire people for the sole purpose of providing jobs. Period. Ain’t gonna’ happen, Tyler. No restaurant owner hires busboys to help the economy. They hire waiters and busboys because customers are streaming into their establishments, over-extending their capacity to serve their customers who have money to spend.

You need to rearrange your idea of unemployment. And what causes it. Drop the small-mindedness. It’s beneath you, because you’re a sharp guy who can think logically most of the time.

If you put a 100 dogs in a room with 95 bones, a minimum of 5 comes out without bones. (Some dogs might find two or more bones.)

No amount of education, re-training, peddling your rich family name, your inside relationship with your local congressman, or your exalted class, is going to change that outcome. Only 95 dogs max can come out with bones.

This isn’t rocket science. Unemployment is a matter of dogs and bones.

And only the federal government can provide those jobs in a downturn, per its constitutional charter, per its power to issue the currency (taxes don’t pay for this shit, you think $2.5 trillion annually in federal taxes pays for anything?), and per its JOB to take care of the society for the benefit of everyone. Public fucking Purpose.

MRW

CORRECTION!!!

Should read: " There ain’t no factory in downtown china manufacturing USD that we borrow. It’s counterfeiting. If you believe that, I have a bridge to sell you."

MRW

Charles,

"In Canada Banks are firing computing divisions after Indians are brought in to be trained in the work before it is shipped off for good. Canadian government abets and gives incentives expressly for it.”

They’re doing that now? Any possibility you have a link?

Tom Cafferty

MRW, excellent MMT (Modern Monetary Theory) analysis. You are so correct, with a fiat currency at the Fed level, any real attempt to balance the budget would be catastrophic. That debt is more about the money supply. And it can always be paid back in dollars which the Fed can take care of with a few computer key strokes...just as they are doing with QE.
Clinton may be a hick from Arkansas, but according to Warren Mosler, he does understand MMT and the difference between state and federal economies. He told Mosler that MMT could not be accepted politically. Cynical grifter.
Hell, Nixon understood it, I think when he finally took us off the gold standard. Cheney "deficits don't matter" understands it as he was in the Nixon administration at the time.
The conservative mantra of "balance the budget" has been distractive nonsense to promote right wing social agenda, at least since 1971 when Nixon dropped the gold standard.

MRW

@GulfCoastPirate,

"The equations that govern the electromagnetic waves that make your computing devices work are the same equations which govern economics.”

Maybe so. But they sure as hell don’t govern double-entry accounting. And ALL FEDERAL GOVERNMENT TRANSACTIONS--operationally--are recorded in double-entry accounting. (Actually it’s quadruple-entry, but I ain’t ‘splaining that.)

Do you know that understanding accounting, taking a real accounting course, is not a requirement for a PhD in Economics at MIT, Harvard, Yale, the Univ of Chicago, and Stanford? Furthermore, advanced accounting students at the graduate level have a hard time wrapping their heads around how the federal government quadruple-accounting system really works.

Let me give you an example of this stupidity.

Everyone quotes the NYC Debt Clock. The $20 trillion. Where the hell is the Asset Clock that represents the other half of the ledger? Double-entry accounting DEMANDS both sides of the ledger. And where are those assets parked?

Wanna’ know? They are in the people’s pension funds, university trusts, grandma’s Savings Bonds, corporate savings accounts, and individual savings accounts, not to mention foreign govts, banks, and investors. Because the federal government hired the private sector during the course of provisioning itself.

Ante

There's just so much of the country where there is no economy. All those places voted sanders in the DNC primaries and seem to vote republican overall. People just want to be able to work decent jobs and live decent lives. That's a bridge too far for the parasitic financial looting class.

America shouldn't have to be like Nigeria, where everyone has to crowd around the big cities in hopes of getting any employment. There's no reason for things to be so bad for so many.

Zed

@Tyler

People not affected by diversity have the luxury of voting for things like, well, the most vexing problems of their libtopias, such as: global warming, racist cops in Ferguson, MO, Christian bakers not making gay wedding cakes in Gresham, OR, etc.

turcopolier

Ante

What you say is true concerning the lack of income in the red counties, but there is also a lot of pure anti-blue cultural feeling even in places where income is pretty good. pl

turcopolier

MRW

In the context of the time of its adoption the framers had in mind to create a more efficient government than that of the Confederation under the Articles. "Provide for the welfare of the people" had nothing to do with improving their economic lot in life. pl

Sam Peralta

Col. Lang

This is the error that all the economic determinists as well as the keynesian cargo cult, the socialists and the big government types always lean back on. In their minds "promote the general Welfare" means that the federal government is RESPONSIBLE for the economic well being of each citizen. In my reading of the federalist papers the framers believed that was the responsibility of each citizen.

MRW keeps at this canard that government spending is the ONLY means for economic prosperity in these United States. Note his comment to Tyler - "Businesses do NOT create jobs." Ludicrous on the face of it!

In an earlier thread (IBD/TIPP Presidential Tracking Poll) he had the thesis that he claims as gospel truth with the same cut and paste that he always places on threads here at SST, which is that whenever the federal government runs a budget surplus or balances the budget the US has an economic depression. In looking at a simple chart of federal government debt which is the best data series as it takes into account the net deficit after all accounting gimmicks, it is clear to even a high schooler who has taken statistics, that there is no correlation, let alone causation, between federal government budget surplus/deficit and economic growth or median household income. There are periods of varying length of time when the federal government debt has remained steady or declined or increased. During these periods we've had both growth as well as declines and no mathematical relationships can be derived.

We find many instances of recessions when the federal government runs deficits and periods of great growth when the federal government runs balanced or surplus budgets.

The chart of federal government debt since 1945 is self explanatory.

https://fred.stlouisfed.org/series/FGDSLAQ027S

This is the net deficit that the federal government has run since 1945. As is clear the government debt was flat from the 50s through the 60s. Yet we had really good growth in GDP and household incomes. However, since the mid-80s, federal debt has exploded and has even gone parabolic since the 2008 financial meltdown. Yet, we see several recessions and the weakest post-war economic recovery after the 2008 recession.

To quote billionaire money manager Paul Singer, just making observations of data:

"Between 1870 and 1913, the real GDP of the United States rose from $20 billion to $131 billion (1958$). That gain of 4.3% per annum compounded over 43 years is the highest real GDP growth on record for a continuous equivalent period of time.

But here's the wonder of it. During that golden age of growth and prosperity, the US had no central bank and not even one episode of fiscal stimulus!

If you allow for population growth from 39 million in 1870 to 97 million by 1913 ...real GDP rose from $480 to $1,350 per capita or at a 2.5% annual rate. That, too, was never again exceeded over a continuous four decade interval.

During the most recent 43-year period, for instance, the growth rate of real per capita GDP was only 1.6%; and since the eve of the financial crisis in Q4 2007, it has dropped to just 0.3% per annum....

Compared to the last 9 years when we have had a tsunami of stimulus, both fiscal and monetary, how did we get 8X more per capita growth in real GDP during the 43-year period ending in 1913? After all, the almighty Fed did not even open its doors for business until the fall of 1914?"


MRW and others like him are cultists, who call anyone that don't agree with their clear nuttiness that infinite government spending is the only means to prosperity as idiots. Just read some of his posts on this topic and what he calls people who call him on his BS. Look at him sneer at Tyler with all that superiority on this thread. Yet, he can't point to any mathematical relationship between federal government deficits and GDP growth rates and median household incomes!

Fred

MRW,

I live, I deserve, where's my check? That's a new one. You left out the "secure the Blessings of Liberty to ourselves and our Posterity,"

Illegal immigrants are not our posterity. The learned helplessness of yet another generation knowing nothing other than life on welfare is not a "blessing of liberty".

different clue

Abu Sinan,

The question is: is White a Race? Or is White a Way? A Way of Being?

Babak Makkinejad

The US Democratic Party is the oldest political party one Earth. To what do you attribute its longevity?

Herb

Both sides need to figure out a way to bridge the divide. Can some adults somewhere step up? Broader gulfs have been negotiated.

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