Wednesday, November 3, 2010

SAR #10307

The American people want to hear that better times are ahead – they don't need to believe it, they just need to hear it.

The Obvious:  It’s the economy, stupid. It is always the economy. Obama and the Democrats were doomed from the beginning by the obstructionist Republicans.

G'way, Y'bother Me:  How is it possible that consumer spending is back and the economy is nearly fully recovered while unemployment hovers around 10%, foreclosures are mounting, poverty has reached a 15-year high and great parts of the public are struggling with debt? Because the richest 5% account for 37% of all consumer spending. Sorry, but most of the American public simply don't matter.

Manchurian Candidates:  Okay, a secret ballot is a good idea.  But it'd be nice to who is pulling the candidates' strings.

Trick or Treat:  Ambac, the bond insurer that has been on the ropes since before Lehman collapsed, says that it will not make its regularly scheduled interest payments and is seeking to restructure through bankruptcy proceedings. About time.

Who's Next?  Is the US in for the same deep budget cuts the UK is undergoing?  A lot of candidates who ran on 'deficit reduction' and 'smaller government' have been elected – is there any chance they'll actually do what they promised, or will they simply trim a little off the top and call it a day.  Let's hope it's the latter.

Paying the Band:  We have spent three decades wallowing in a standard of living never before seen in the history of the world – and not because we were the wealthiest, most prosperous nation ever, but because we were accumulating the biggest pile of IOU's in history.  We have now been living beyond our means for so long that we consider it to be completely normal.  The only way the US can continue to grow is through even more borrowing, ever more debt.  And that's not going to happen.  It's payback time, and we owe over $50 trillion.

Ownership:  Wouldn't it be refreshing to hear a self-described fiscal conservative outline a concrete proposal that would have a significant impact on the deficit?  They can't, because they are just mouthing the words.  Pretending.  Lying.

On Schedule:  According to Fitch Ratings it will take over 3.5 years to sell off the 7 million houses that now make up the shadow inventory – and those numbers will only grow as time passes.  The more foreclosed/REO/vacant houses there are, the further house prices will decline and the greater the losses on mortgage-backed securities – and that’s the important part, investment losses.  To hell with the homeowners.

Redefining The Goal:  In case you had forgotten, Social Security exists to keep the truly old – think 85 and crippled – out of poverty.  Its only purpose is to prevent people from outliving their means of supporting themselves.  "The evidence indicates that most Americans could work longer and would benefit from doing so."   Raising the retirement age and forcing most of the elderly to work would help Social Security finances somewhat and, more importantly, would be a big boost for the rest of the budget as they would keep paying payroll taxes.  The End.   And that's the reasoning from the right.

Porn O'Graph:  No thanks, no more, I'm full.

7 comments:

Anonymous said...

@ redefining The Goal

Assuming of course there are actually jobs available for them to have.....

CKMichaelson said...

I included 'Redefining the Goal' because I thought it was one of the best self-hoisting petards I had ever seen by a SS doomster explaining away the problem by redefining the whole debate.

Jobs is just the first problem - jobs an older person can do for 40 hours a week that would pay a living wage are far harder to find & the co0mpetition for them is already daunting.

But wait, do unemployment benefits top SS payments? Especially for early retirees?

Anonymous said...

CKM

Wasn't a criticism, just confirming the message. And of course, any income REDUCES the SS benefits.

I really look forward to SAR every morning....thanks for the efforts.

OSR said...

There most certainly is a better way and it is so astonishingly simple, I'm surprised it hasn't been suggested.

lineside said...

CK

Couldn't help but notice a rather gaping contradiction between "The Obvious", wherein you seemingly endorse Krugman's lament that the stimulus package wasn't big enough, and "Paying the Band", where you (correctly, in my opinion) state that "We have now been living beyond our means for so long...The only way the US can continue to grow is through even more borrowing... And that's not going to happen. It's payback time..."

Until we purge the bad debt out of the banks, and let their shareholders and bondholders eat the costs (instead of the taxpayer, courtesy of both parties), no amount of stimulus will fix the economy. And until we get our fiscal house in order, one way or the other, same goes. It will be painful but it cannot be avoided. Krugman's recurring delusion of free lunch is as valid as belief in the tooth fairy.

Cheers

CKMichaelson said...

lineside - like many, I don't let my inconsistencies bother me too much. Yes, I think we should have undertaken some extensive infrastructure repair with the stimulus money. Probably should have put a great deal more money into projects that would have prepared us for the alternative energy future by not funding more highways but by emphasizing 'green' conservation projects.

At the same time I know we've got to pay the piper for 30 years of a credit-card delusion. But I'd like to make sure that those who drug us to the dance pay up first and most.

So we should have had more stimulus and more debt, if only on the vain hope that we could slowly work out this mess - instead of plunging head-first into tragedy.

Speaking of tragedy - OSR, are you making A Modest Proposal?

SPECTRE of Deflation said...

"The Obvious: It’s the economy, stupid. It is always the economy. Obama and the Democrats were doomed from the beginning by the obstructionist Republicans."

ROFLMAO! The Democrats had the Presidency, the House and the Senate, and they ran the Debt from $9 Trillion to today's $13.7 Trillion. You have to have a twisted mind from the spin you are putting on a good ole' ass kicking the socialists took last night. Repudiation is a real be-atch! LOL!!

Tonight it's a good single malt and a fine cigar to celebrate Barry's policy repudiation by the American electorate. Party on dude.