Sunday, May 23, 2010

Its A Cold, Cruel World (Compilation)

I compiled the "Its a Cold, Cruel World" series into a single essay. The originals were published during the first week of March, 2010 and are complete with links to my sources - this essay is published without those links.

Without further ado....

Its a Cold, Cruel World

"Mutually Exclusive Events and/or Outcomes": any event or outcome that by definition precludes another event or outcome (this is my definition - if someone has a better one.... post in comments and I will edit).

There is a very good reason that our politics are failing us here in the U.S. and the West. Every single one of us (ok, that's an exaggeration) exploits the "sound bite" and ability to speak out of both sides of our mouths even when confronted with powerful facts contradicting our positions.

Allow me to point out some examples:

Peak Oil and Fossil Fuels -vs- Atmospheric Carbon Projections...

Well....... if we have limited Fossil Fuels (Carbon) to burn, then we cannot have unlimited Carbon entering the Atmosphere... now, can we? Yet ALL, YES ALL, of the climate change projections assume unlimited supplies of Fossil Fuels to burn - meanwhile EVERY peak oil doom prognosticator (besides me) I can find on the web always seem to mention fossil fuel depletion and climate change as 2 sides of the same coin. There is simply no Universe in which that makes sense.

Peak Oil will happen, so will Peak Coal and Peak Gas... and they will happen LONG before the earth has 1000 ppm of Carbon in the atmosphere. It will happen LONG before the earth has 500 ppm of Carbon in the Atmosphere. We are already at 383 ppm. I am not a climate scientist, and I am not denying climate change is quite possible and probably not a desired outcome (to say the least). What I AM saying is that obfuscating any FACTS or TRUTH does not help the debate - yet that is EXACTLY what I see going on here (probably a good strategy to gain funding or grants).

Economic Growth -vs- Pay-As-You-Go Social Programs (Social Security & Medicare)...

Many on the Left have caught onto the idea that "Future Growth is Not Possible". As properly defined I firmly agree with them (more on that definition in a future post). Well that means the end of any and all government sponsored Ponzi schemes, doesn't it? Meanwhile certain groups decry the U.S. military from enforcing US$ hegemony while scooping money out of the Washington troff with both hands (and feet). You can't get a little bit pregnant.

Economic Solutions to make things "Fair" -vs- Resource Depletion...

There is not a Socialist/Left web site that does not blow out of one side of its mouth that the argument that the world's 6.5 Billion people can all live like American's with our current resource consumption is complete Bull Sh*t (and that is absolutely true)... and then goes on to argue that all of the poor need a middle class existence to be happy or to make life fair. We can't have it both ways. If the physical resources are not there, why do people make that argument? For political gain. If everybody had a personal jet, there would not be a drop of oil left on the planet. Jets are an extreme example. What would happen (don't worry, it CANNOT happen) if every family of 4 on earth lived in a 4000 square foot McMansion and drove a SUV? Same outcome, only worse. There wouldn't be a square meter of ground for growing food - it would all be covered by houses and parking lots.

In 100 years ALL of the world's oil will be gone... nothing we do now will change that outcome - the question is can we and should we use government agents with GUNS to make life more fair? I mean, there will always be a surplus of goose stepping jag offs willing to beat and shoot you at a particular government's behest, no questions asked. History is replete with examples. Is that really what we want?

What I am getting at is this:

Be careful what you ask for, you may just get it.

And...

You can't have it both ways, and it is very, very non-constructive to pretend or argue that we can.


IF/THEN:

IF... yes IF...

Guys and gals like me, Jimmy Kuntsler, Dmitri Orlov, Jeffrey Brown, Sharon Astyk, John Michael Greer, Robert Rapier, Gail Tverberg, Jay Hanson, Saif Lalani, Mike Shedlock and Web sites like LATOC, TheOilDrum, and EnergyBulletin, et al, are correct and we are in the beginning throws of energy decent... and that the painful contraction in the economy is at least partly due to this, as well as the end of credit expansion, and that this will continue over the next decade or 2 until we are essentially out of "common use" oil...

THEN...

It makes no sense to extend unemployment benefits or the housing credit, or to enact another stimulus plan... people living in the West, particularly America and Europe need to accept what jobs there are - be they picking strawberries or shoveling snow; need to accept that they may need to live with roommates or family rather than by themselves in spacious and private homes or apartments; need to accept public transportation, walking, and car pooling, gardening, no health insurance etc... especially "health insurance". What would make you think that we can have free healthcare and free unlimited end of life care while going through the End of the Age of Oil? Does that make any sense whatsoever?

Many of the folks I mentioned have been publishing for years that this was in the cards. Yet when I read many of their posts (not all are guilty... Orlov and the MS have no problem telling you are going to be making some adjustments) and articles many continue to blame the (fill-in-the-blank) rather than tell their readers that, speaking in the Macro, we are all just better off getting used to the new environment. That would mean ending government programs that do nothing but delay the inevitable at GREAT expense.

Because IT is HAPPENING!! The level of denial from the folks that predicted this IN THE FIRST PLACE is really quite astounding. Continuing to rail against the "rich" or the Republicans or Wall Street or greedy CEO's as we see the Liberal Media and the Left doing... is silly. They are going to get wiped out, too! Here's why: All that money that folks "owe"? They ain't paying it back! And guess who they "owe" that money to? The "rich". Well, the "rich" are no longer "rich" if everybody defaults on the bonds the "rich" own. The new "rich" will be folks that own different assets than today's "rich" own, though we might argue what they might be or how much would be necessary to be classified as rich.

The decline in Oil imports that the U.S. has experienced over the last 3 years, about 2.5 million bpd, simply are not coming back. We have a serious problem in Nat Gas coming, and Oil imports are going to continue their inexorable decline. As a result, the economy is going to contract in "real terms". Period. There are going to be more people living in a home than has been the case in 40 or 50 years. Fewer people are going to have access to a car. More people are going to have to accept jobs that are not terribly rewarding, however you define that, and get over their resentments, and plenty of folks will have no job at all until they accept the new reality - which for many folks means taking whatever you can get.

Did I mention that sometime in the next year California is going to default and need a massive Federal bailout? And that Illinois and New York are right behind them?

These dots are right there for you to connect. It is my opinion that many big insiders, like Senators Bayh and Judd, are quitting and distancing themselves from the coming political conflagration. Actually, that's not correct... that is not an opinion… that is a fact - as was stated by both Senators when the announced their retirement.

No, you won't be able to tell which day "IT" happened. "IT" has already happened to millions of folks and many of them don't even know it. "IT" is here, and "IT" is going to grind its way through to each and every one of us. Fighting "IT" won't help any more than swimming away from a sinking ship a thousand miles from land... where you going, anyway?

If you have the resources this is the time to trade them for the things that will have value. If you don't have the resources, get used to the environment I mentioned above.


It is a cold, cruel world. And as it turns out, "Peak Credit" (the term coined by Mike Shedlock) is likely as big a problem in the West as "Peak Oil", and likely will be for another few years... we shall see just how correct folks like Me, Jeffrey Brown, Saif Lalani, Ken Deffeys et al have been with our export/import models soon enough - by the end of 2011, I should think.

Right now, while the "financial system" has been stabilized, it certainly has not been fixed. I am going to speak of the U.S. economy, for the most part, and its effects on the American people and the ROW. This is going to be a brutal, politically incorrect assessment of where the U.S. finds itself, and what the U.S. is going to be like post purge - because that's what's up, the U.S. is about to purge: major gastro-intestinal distress with a release coming from both ends.

How did we get here? Glad you asked. Sooooo.... here comes MY definition:

We got here because "WE" wanted to reconcile an unfair and unjust world with the fair and just G-d that our people were purported to believe in, but Who just seemed to be falling down on the job (otherwise why play G-D?). After all, as George Carlin famously quipped:

G-d is all knowing, all powerful, all seeing, and all wise... he just can't handle money. He always needs money!

Just kidding.

Anyway, since life was not fair, and we all agree that it is not, and we wanted to show what kind of society we were... the nice folks in the FDR administration came up with what we now know as Social Security et al (by et al I mean all of the myriad state and federal transfer payment programs). From the Wikipedia Social Security site:

U.S. Social Security is a social insurance program funded through dedicated payroll taxes called Federal Insurance Contributions Act (FICA). Tax deposits are formally entrusted to[3] the Federal Old-Age and Survivors Insurance Trust Fund, the Federal Disability Insurance Trust Fund, the Federal Hospital Insurance Trust Fund, or the Federal Supplementary Medical Insurance Trust Fund. The main part of the program is sometimes abbreviated OASDI (Old Age, Survivors, and Disability Insurance) or RSDI (Retirement, Survivors, and Disability Insurance). When initially signed into law by President Franklin D. Roosevelt in 1935 as part of his New Deal, the term Social Security covered unemployment insurance as well. The term, in everyday speech, is used to refer only to the benefits for retirement, disability, survivorship, and death, which are the four main benefits provided by traditional private-sector pension plans. In 2004 the U.S. Social Security system paid out almost $500 billion in benefits.[4] By dollars paid, the U.S. Social Security program is the largest government program in the world and the single greatest expenditure in the federal budget, with 20.8% for social security, compared to 20.5% for discretionary defense and 20.1% for Medicare/Medicaid.[5] Social Security is currently the largest social insurance program in the U.S., constituting 37% of government expenditure and 7% of the gross domestic product[6] and is currently estimated to keep roughly 40% of all Americans age 65 or older out of poverty.

You can read the above link yourself, you don't need me. You can see the years where the coverage was expanded, and the steady increase in the tax rate, and the expansion into healthcare in 1965, and the many adjustments to the system thereafter...

Now, superimpose the timeline in the above link over the Oil production and export/import timeline for the U.S. In 1935, the year Social Security was enacted, the U.S. was the world's largest exporter of Petroleum. In 30 years, 1965, when Medicare was enacted, the U.S. was only 5 YEARS from the peak of its production, and within an additional 35 years, imports of Oil into the U.S. were DOUBLE domestic production. In other words, in a time span LESS THAN A HUMAN LIFE Social Security went from enactment to insolvency and the U.S. went from the world's largest Oil exporter to largest Oil importer. When Social Security was enacted in 1935, the presumption was that the U.S. would be able to expand its Oil production forever - and that presumption has turned out to be quite wrong. There was also the presumption that Social Security benefits, and later Healthcare (Medicare) could continue growing at 2X or 3X the rate inflation or GDP - and that presumption has turned out quite wrong.

So here we are, its 2010 and Medicare and Social Security, 2 programs growing exponentially and that have entered their terminal apogee at the extreme NE quadrant of a quadratic table:



This is the graphical representation of "e". Conceptually, anything growing exponentially will grow to infinity, or have the slope of the line go vertical. Since Medicare and Social Security cannot GO vertical... well, we all know what has to happen.

BUT!!!

Addicts have no idea about graphs, and slopes, and exponential functions... they only know that they need their fix - the government check in the mail, cheap oil to drive 40 miles each way to work, credit cards to assuage depression brought on by long commutes, expanding waste lines and boring love lives... by consuming sh*t we don't need and forcing us to work at jobs we hate to continue to do so, not to mention to pay off those student loans... and, boy! Was the Government ever successful at addicting millions of people to years and years of idle time funded by the demographic tail end of that graph...

So, here we are... with demographic time bombs going off all around us... otherwise known as California, Illinois, New York, the Federal Budget.... and crazy people educated well enough to know better insisting that the above sloped line is NOT true - pay no attention to that man behind the curtain! - none of us has any responsibility at all because all we have to do is tax the "rich"! AND mock people living in fly-over-land because they had the inability to see the simple logic that the elites know better...

Now the time has come... soon the check WON'T be in the mail... because the international bond market won't let Uncle Sam get to the post office (they're broke, too)... Soon... lunch won't be free, love won't be free (whoever said "free love" clearly had never been married and divorced), and healthcare certainly won't be free...

Americans will be forced to save money and live within their means! Can you believe THAT? We will actually question taking on 200k in debt for aLiberal Arts education! We will pack lunches, cook dinner at home, buy things second-hand, wear hand-me-downs, work until we die, and pay for our own mistakes with our own money. The first generation going through this won't like it one little bit, but those that come after won't know any other way. Some people will still get rich, and others will not. Some people will be good looking, while most will be as plain as Abe Lincoln. Some will live long, while others die young. We WILL get over the idea of trying to legislate LUCK away. Luck will always happen to a few, and not to the rest and we will give up trying to make life fair by hiring government thugs. People who call themselves "Liberals" or "Humanitarians" won't be much of either unless they can do it with their own money, but they won't have much money so that won't be an issue.

Old people that have no family and that have been relying on the government are in for an incredible experience - and not a positive one. Most recent college grads will be fortunate to find menial work having nothing to do with their training for pay that will leave them living on top of each other Manhattan style - but with none of the benefits of living in Manhattan. Each and every one of us will be forced to actually produce something/perform a service or go hungry. On a happy note, divorce lawyers will starve to death, along with Feminism…

The Great Recession and the Great Deflation are going to be bigger than Peak Oil for the near future, and they are going to humble Great and Small alike.

You see, the 17% "real unemployment" is not "real unemployment", either. To make accurate comparisons as Oil and energy become less and less available on a per capita basis is the real issue. (Here's something to think about... Oil consumption in kilocalorie terms per person, or per capita, in the U.S. is down about 5 or 6 % since 2005... more people, and less kilocalories....) we as a society have to start telling ourselves THE TRUTH. The 40 million folks over the age of 65 should not be excluded from the employment calculations because they sure as h*ll did not pay into the system what they are extracting (otherwise, we would have a surplus, right?), and they sure as h*ll are not producing members of society.

Same goes with young adults. People in college are an enormous consumption drag on our output. The entire college population that is not working should also be counted into the employment numbers.

There are a few other groups - prisoners, the disabled, welfare and food stamp recipients that are not employed et al, and when you add seniors and college students et al... the remaining producers and tax payers simply cannot support the government services these groups require by NOT WORKING! (Yes, you can argue that education is an investment, and in a large minority that is true... so we will have to discount for that portion - while once again subtracting for the 23 to 30 year olds that live on their parent's couch playing video games.) The non-working spouses of folks making a good living and NOT taking care of the home unassisted (those with domestic help and nannies) must also be added this number.

Unfortunately, and I want to say this gingerly and with respect… we would need to calculate all military personnel as well.

ALL, that's right, ALL of these folks are consuming from the tax pool or disposable earnings pool that the tax payers are paying into, and there are simply too many people drawing from the pool and not enough people paying into the pool... now add to this equation the fact that Oil subsidizes the efforts of those paying into the pool and reduces the requests from those drawing from the pool.

Up until this point we have had the international bond market to fund this absurd cluster f***, particularly China and Japan, but now it appears that they are choking on the paper, and the Federal Reserve has had to step in and monetize the debt. The good news, if you want to call it that, is that the deflation in non government debt has outpaced the printing presses, and will for some time to come. Still, the Administration is NOT making noises about "jacking the social security retirement age" just for the fun of it. They got some guys there (Volker) that can count, too.

Of course, these pools of tax dollars for social programs have the perverse effect of creating more and more dependent people, another exponential function to calculate (in Dr. Bartlett's famous speech he speaks of a local politician that says he grasps the "e" function, but does not believe that it applies on the local level... to which Dr. Bartlett amusingly replies: "Oh, great. We have a local politician that believes that the laws of Mathematics do not apply in Boulder County, Colorado... worse, he has a degree from this (Univ. of Col. Boulder) institution... how embarrassing!") Certain members of the political establishment can see clearly that Americans are addicted to Oil, but CANNOT seem to see that American's are addicted to unfunded and teetering "social programs" (free money).

In the end, "It's a Cold, Cruel World" and the world will make the adjustments for us because as I have said a GAZILLION times before: There is no macro solution to any of this. The mass of folks believing in, and addicted to (and hence unable to provide for themselves) these entitlements is just too f*&^%ing large to be overcome (thank you, FDR) politically. You can see this in the price of Gold, Oil, the employment situation et al...

Speaking of employment... all of the absurd regulatory overreach (as well as the not so absurd) will come apart in the near future. Sexual harassment policies, discrimination policies, government worker's unions, etc... were all creations of the age of cheap and abundant energy, along with a long list of social and political "isms". Feminism? Gone. Liberalism? Say good night, Gracie. The NAACP? Gay Rights? Who cares? We won't have any money to fund any of this stuff. In a resource constrained world nobody is going to care who you are sleeping with (especially if it simply cannot result in a pregnancy) or what you are angry about.


Liberal economic policies have blown their constituent's belief systems out of the water. By increasing the number of people receiving government assistance, whether it be for rent, heat, food, healthcare, etc... doesn't matter. The fact is that the exponential function applies to liberal economic policies the same way it applies to human populations or weeds in a building lot - if the number of "tax receivers", (those receiving NET government assistance - which means plenty of "tax payers" are really "net tax receivers") continues to rise steadily then by definition anyone with a calculator can apply the exponential function, determine when the slope goes vertical and the system fails. Pretty simple, really. EXCEPT... we are talking politics. The same folks that grasp ERoEI (Energy Returned on Energy Invested) go f*@&^ing deaf, dumb, and blind when "e" is applied to any of their core beliefs.

But the "Cold, Cruel World" doesn't give a good fart WHAT you believe. In fact, the only reason we are even having this debate is that these belief systems have caused the outcome that mathematics predicted with certainty would come to pass.

I read a lot of the writings from folks on the other side of the aisle around the blogsphere. Kuntsler has some amusing commentary about complexity in his most recent post, not all of it very consistent. I watch in fascination as MILLIONS of folks on the Left support a 2,000 page healthcare bill that recasts one of the largest and most complex systems in the history of mankind... EVEN THOUGH THEY HAVE NOT READ IT! Is that hysterical?!

I watched in morbid fascination the debate on going to War in Iraq. A nation that had just witnessed, and was appropriately appalled by the murder of 3,000 non-combatants on 9/11/01 was supporting the idea of dropping half-ton bombs on population centers!!

Sometimes I think I am the only normal person left.

Think of the "Green Revolution". Did it alleviate world hunger as promised? Of course not. Did it encourage an explosion of population (think Haiti) that only increases the number of people starving? I leave that to you.

Did the social programs in the U.S. alleviate the suffering they were charged with? Or did they only increase the number of people that will endure tremendous suffering in the future? If you answered no to the first question and yes to the second...

I want to emphasize a point I made earlier: Energy in general, and Oil in particular has MAGNIFIED, or LEVERAGED the ability of the productive members of our society to produce enough goods and services to have supported the non-productive. Please think about that. How "productive" will these people be in a world of declining energy availability? How would it be possible to confiscate enough of their production to satisfy the demands, given the fact that we are running enormous deficits to fund this cluster f***, of all of the "tax receivers"?

Tell me how that can be done.


Today's quote:

"You know the difference between a terrorist and a do-gooder? You can negotiate with a terrorist." - Unknown. Brilliant, but unknown...


Some have turned to free clinics. It’s just one indication that the health care crisis is really an economic crisis. And for the boomers it’s only going to get tougher, according to Harvard financial historian Niall Ferguson.

“If they’ve done their homework, then they’ll be afraid,” he said. “Very afraid.”

Ferguson says it won’t be easy to care for a generation with ailing bodies and many more years to live.

“The baby boomers have set us on a path towards a massive fiscal crisis,” he said. “Which is going to hit as the baby boomers retire.”

The recession, though devastating, will pass. But rising health care costs as boomers age may bring lasting harm to this generation’s financial well-being. By the time all boomers are 65, the senior population will have grown from 40 million now to about 72 million. Who will pay their medical bills?

“This thing is going to blow up,” said Ferguson, “because A: The number of retirees is about to zoom upwards just the way the number of teenagers once zoomed upwards in the ’50s, ’60s and ’70s; and B: Because the costs of these systems are completely out of control.”

The strain that the burden of caring for aging boomers will put on the health care system could overwhelm the economy.

If current trends continue, in 20 years almost a third of everything we spend on goods and services will be spent on medical care.

“The cost of health care for the elderly has been explosive,” said Ferguson. “And that is the crisis which seems to be the really big crisis lying ahead of us. We simply don’t have an answer as a society to the problem of a very large number of relatively unhealthy people who live into their 80s.”
And so it goes and will go and go and go until the mushroom cloud climbs over the horizon, blowing up what had been a noble experiment because a bunch of do-gooders really thought they could change the Facts of Life, or that there would never be an unintended consequence to their do-gooding, or that as long as you meant well its ok if you bring down the world's great Liberal Democracy...

Great nations are destroyed from within... by sloth, greed, unrestrained extravagance, arrogance, pride, boastfulness... of their people. They are not destroyed by their enemies nor by the frugal, modest, reasonable, and rational. Our foolhardy attempt to remove personal responsibility from the lives of our citizens and its celebration in our sh*t-for-brains media and pop culture has led us to this sorry state of affairs.

Doubt this? Let me ask you a few questions:

Was our society harmed by:

People starting businesses and employing people?
People saving their money and living within their means?
Parents providing for their children and making sacrifices to provide for themselves?

Not a shot.

Our society has come to this unhappy place because of the unholy alliance between a political elite that sold out the people mentioned above, pandering to those that did not or would not and expanding their numbers with the confiscated resources of the productive portion of society to the point that our financial system is unraveling.

I am sure to get ridiculous anecdotal data points about Ken Lay and Enron... or whoever. I could reply that Bernie Madoff was one of the New York Liberal elite's biggest financial contributors. But this is unimportant. All of us under the age of 60 have already been ripped off, the proceeds of the Ponzi scheme have already been distributed by the political elites, and there is no way to get it back - but the expectations remain.

"And therein lies the rub..."

23 comments:

bureaucrat said...

Nice "bottling of the message." But how many times has the world come to an end in the past, and then, strangely, today, it didn't.

1) Europe: same number of people, just as old, no oil, high taxes, nowhere near the debt the U.S. and Japan has, and yet, they have functioning socialist states -- many people even have basic health care.

2) Old people -- contrary to what the baby boomers think, you are going to get old, you are going to die, and therein lies the inevitable end to the trillions of dollars of benefits you are expecting. Year 2040: almost all of you boomers are off the government teat. *whew*

3) If you are a new fan of Shedlock, you know he is of the mind that all the money we need to borrow to fund the government is right here in America. U.S. Treasuries can be (and will be) sold to Americans -- once they are either compelled to buy them or the stock and rest-of-bond markets become so awful to invest in -- that we now have new buyers of our debt: Americans.

4) The state of Illinois has a $13 billion deficit, the second worst state. You know how much I'm suffering? Nada. And almost everyone else is enjoying the beautiful, warm day today. Unless you are in the education, health delivery or disabled care industry, we couldn't give a damn if Illinois goes bankrupt.

5) All those baby boomers who are going to bankrupt the governments were teenagers once. They entered as a gang the colleges, the housing market, the car market, the marriage market, the baby-making market, the job market, and somehow we got thru that adventure ok.

All we need to do is consume less, waste less, live less and expect less. Oil was a wonderful gift. Now it's time for phase 2.

PioneerPreppy said...

Good essay.

As for Bur's baby boomers entering, breeding etc. they did so without all the social spending we have today. In fact they allowed it to happen so although the economy had the wherewithall to soak them in it hasn't had it to digest all the damage they have done.

I am also unclear about Ill. employees having to suck it up but next door here these employees have lost holidays and some benefits already and it is only going to get worse.

In the end you are right with your predictions. It's not the end that concerns me however but the moves of desperation the government(s) will enact to keep from shrinking. Wars, lawlessness, brutal taxation, riots.

We are not a moral Christian country any longer I am afraid like we were in the 1930's.

It's going to get bad...

Stephen B. said...

Bur, you are too comfortable with everything.

I have learned in life, THAT is the very time to take a better look around.

k said...

The cops can make up for decreases in wages and benefits by extortion and robbery. I wonder, what % will do so and when will the USA ought to be called the United States of Afrika?

Dextred1 said...

Jeffers,

Awesome!! You pretty much put together everything that is rattling around in this blog\comments for the last yr.

Bur,

Things never change until they do. Europe is a terrible example to use. They count on us for much of their defense costs and hence get to spend another 4-8% of GDP on social programs and debt payments (most likely more, but I stayed conservative). Most of the majors there are approaching 100% of debt to GDP. They have exported most of their manufacturing because of cap and Tax and need less energy than a normally functioning economy and the bond market has provided the needed breathing room, but not any more. The shit is hitting the fan there and quickly.

bureaucrat said...

Defend Europe from whom? :)

The Feds have paid me every 2 weeks for 21 years. Blue Cross via the Feds paid for a $150,000 medical prob I had ($5,000 out of pocket for me) They deserve some credit for that.

Something bad happening? Pshaw! :)

Greg T. Jeffers said...

Bur:

The "Feds" didn't pay you or for your "medical problem". THey used armed thugs and treats of force, violence, and incarceration to extract money from the population to give you something that is not available to the private sector.

Anonymous said...

B,

This piece was dedicated to you.

peace

bureaucrat said...

I have no prob with open discussion. I would rather bring everyone up to my level of relatively nice pay and benefits that to "Shedlock" everyone down so that a few ultra-rich people Lord over 99% of dirt poor America.

I used to think there was no money for pay and benefits for everyone, but as 2008 shows, there is LOTS of money available. It is just being hoarded.

There will come a day when a "Hitleresque" figure will start telling the people what they want to hear: that America is being destroyed by jobs being shipped overseas. Then we'll have someone to blame. Then we can bring out the torches and pitchforks. The white people still have all the guns in America. I'd prefer it not come to that.

Anonymous said...

Bur,

You and the rest of the Socialists think it is just about the money. Just pass it out and everyone will be well off... Think. The wealthy DO NOT have hoards of nice clothes, cars, and 1/2 acre lots with nice houses on them, nor cages full of doctors and nurses waiting to be set free to cure the sick world.

The rich own stocks and bonds and T-bills. You can't eat them. They won't protect you from bad weather. You can burn them, but they have low heating value. It is a matter of productive capacity to provide all of the extra stuff. It does not exist. Passing out cash will not bring it into existence.

Making the rich poor does not make the poor better off. It just adds to the number of poor. What did they find when they cut the goose that laid the golden eggs open? Goose guts. The stuff is just not there. I'm all for stopping the elite from gaming the system. I'm all for catching the crooks. But this class warfare crap has to stop.

If your enemy is everyone making $5000 more than you, how many enemies do you have? How many consider you to be the enemy? Be careful what you wish for.

Regards,

Coal Guy

bureaucrat said...

But stocks, bonds and T-bills pay dividends & interest (usually :)), and there are millions of rich people in America earning money this way. You just can't see them.

The people with the big cars, McMansions, living it up, are NOT the rich in America. All these people have is CREDIT. (I'm sure you've all read the book "The Millionaire Next Door". Explains pithy sayings like "Big Hat, No Cattle :)).

You and I and everyone else knows "gaming the system" is exactly what is happening. If it all weren't so disgusting, Jeffers wouldn't have left Wall Street and he wouldn't be railing against college graduates. :)

The rich people in America are like my parents. Born during the "silent generation" (born 1930-1945), watching the fallout from the Depression (and who become tea baggers), they live in a basic 3-bed house in the suburbs, had three children (who had very little spent on them), drove old Buicks, and dad had a boring job downtown just like I do now. These are America's truly rich.

TAX THE HELL OUT OF THEM! They are HUGELY benefitting from our free-spending government.

Anonymous said...

These are NOT the people you're looking for. the ones you're looking for are the elites in the Harvard club that run the banks and the government. The people that busted their hind ends all their lives to have a couple million in the bank, a paid-off house and a secure old age shouldn't have it confiscated by the government. They worked. They earned it. It is theirs not yours and it should stay theirs. We encourage my mother in law to spend it while she's alive, and enjoy the fruit of her labor. Earn your own. That's what I'm doing.

Regards,

Coal Guy

bureaucrat said...

There are millions of people like my parents, and only a few thousand "Harvard yarders." The parents haven't given me hardly any of the family money (what they inherited) as of today, so I say even louder ...

TAX THE HELL OUT OF THEM!! :)))

Anonymous said...

The government should not go around taxing the hell out of anybody. Why bother to make any extra effort if the government is going to take it? It is counterproductive on so many levels.

I got from my parents as much as anyone could ask for. They brought me up to be a responsible adult. Anything beyond that is just icing on the cake. For everything beyond that I'm thankful. I am certainly not entitled to anything that they had, and the government even less so.

That incestuous pack of a few thousand elites is the bunch that is gaming the system. They are tilting the playing field in their favor, to the detriment of everyone else. I am very doubtful that they will be stopped. Creating a bigger more powerful government is just what they want. What's good for the government is good for Government Sachs and Government Motors. Raise taxes? Bahhhh!

Regards,

Coal Guy

Greg T. Jeffers said...

Coal Guy:

Politically, and I fall into this category, the few people that simply worked their a$$ off, sacrificed, saved, invested, and succeeded in what I call the Middle Class Millionaire effort, put a few million in the bank, educated their kids, drove a modest car and paid off a modest house in order to provide their family with financial security are DESPISED by the union worker and the government worker and the folks on the dole and elite. How and why those groups coalesced together for this purpose is another story...

For whatever reason, a police officer retiring at 40 with 20 years on the job with a $100k annual pension is NOT hated as the Middle Class Millionaire is...

I don't know why this is, but it is... Jealousy, maybe? Who knows. And it is really, really sad. Because that WAS the American dream.

I am not "rich" in the Steve Jobs Bill Gates sense of the word. I never took a company public, or invented an anti-gravity machine... I merely showed up every day at whatever it was I was doing with my PBJ sandwiches and my worn out suits - and yes, I did make million's of $$, and yes, I still have a few of them left... And more than once I was BROKE, with no pension, no guarantee, and one hell of a lot of stress... AND NO, I don't think it is fair that I should have 90% of my interest and dividends confiscated... or have 55% of my assets that I want my children to inherit confiscated when I die...

In the mob's effort to kill the aristocracy (that would be Government Sachs et al), they appear quite willing to demolish guys like me, as well.

Greg T. Jeffers said...

As Woody Allen famously quiped:

"80% of life is just showing up."

bureaucrat said...

We aren't talking about the hard workers in America. We're talking about the people who game the system FOR REAL. We are talking about the rich buying Bush (and Obama) and demolishing the regulatory state. Obviously those damn bureaucrats don't know how to do anything right (except make social security and medicare payments, win WW2, etc.), and then further compounding the problem by bailing out those rich snobs who own all the stocks and bonds when their high-risk antics cause their losses to threaten the average American's financial life.

There are lots of people who get up at 5:30am to go to a job they hate for the last 21 years. I honor myself for that. :) We are talking about well-off people who steal and sponge off the system and think they don't owe the government anything in taxes. I beg to differ.

Everything above $100,000 in inheritance should be taxed 100%.

bureaucrat said...

From John Mauldin, a financial writer ..

"The greatest systemic risk, therefore, is not an economic concept but a political one. Systemic risk emerges when it appears that the political and legal protections given to economic actors, and particularly to members of the economic elite, have been used to subvert the intent of the system. In other words, the crisis occurs when it appears that the economic elite used the law's allocation of risk to enrich themselves in ways that undermined the wealth of the nation. Put another way, the crisis occurs when it appears that the financial elite used the politico-legal structure to enrich themselves through systematically imprudent behavior while those engaged in prudent behavior were harmed, with the political elite apparently taking no action to protect the victims."

Greg T. Jeffers said...

Bur:

OK. I got it. You ARE a communist and a "True Believer."

There is no point in continuing the discussion. I AM a "True Believer" of sorts, too, I guess.

I truly believe I should not have the power to F**k with people. You truly believe you should have the power to f**k with me.

Greg T. Jeffers said...

And in the final analysis that will absolutely lead to armed conflict at some point. Millions of Americans DIED fighting your belief system... unfortunately, it does not appear that that was enough.

bureaucrat said...

I'd rather talk about oil. :)

Joseph said...

@bureaucrat
The parents haven't given me hardly any of the family money (what they inherited) as of today, so I say even louder ...

TAX THE HELL OUT OF THEM!! :)))


Everything above $100,000 in inheritance should be taxed 100%.

Ok, now you're just making fun. Can you even say some of this stuff with a straight face? If you would bless us with knowing the net worth of your estate? 100K, 500K, 1M?

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