Tuesday, July 26, 2011

SAR #11207

Where's Robin Hood?

Ten Years and Counting: Back off and put the angry words down. What we're fighting over isn't worth fighting over. The big deal seems to be cutting this, cutting that, taxing this more or taxing that less. But is there really a monster under the bed? As best we can estimate (Having let the CBO do the figuring) if nothing is done but march on ahead, the by 2021 the federal budget deficit would be $729 billion – after paying $800 billion in interest. Not great, but not worth all the hair shirt and ashes routine either. If we stopped fighting 2 or 3 wars, we could easily be close to break even, even. However, if we do not let the Bush/Obama tax cuts expire and/or we adopt the gang of six's $1.5 trillion in tax cuts, then of course it'll be time to buy granny's cat food by the case.

Lest Ye Forget: Only 56% of Americans are covered by employer-provided health insurance. The rest of us are on Medicare, Medicaid or are dependent on free clinics and emergency rooms.

Miracle Whipped: A return to a 6% unemployment rate in 4 years is a nice goal. Unattainable, but a nice goal. To do it, the US would need to create just under 250,000 jobs per month for four straight years. This has – at best – a 1 in 10 chance of happening. Getting it down to 8% in 4 years is a 50/50 proposition. Don't hold your breath.

Deciphering Doom: Cutting government spending takes money that used to re-enter the economy in the form of wages, social transfer payments and government purchasing and gives it to paying off the debt. This cuts consumer demand and the economy shrinks. As the economy shrinks (and parts are carted away via privatization) tax revenues fall and the government cuts more workers, makes ever smaller transfer payments, and so on, reducing even more the income of the consumer and depressing the economy further. But the banks must be paid, so taxes on the struggling workers must rise. Rinse and repeat. Then show surprise when it doesn't work as advertised.

Asked & Answered: Can urban agriculture – by which they mean growing food in humongous indoor farms in the midst of cities – feed the world? Yes, but only after they come up with an infinite supply of energy. Oh, and find some phosporus.

Point of View: The Republicans claim the Democrats are unnecessarily stirring up class warfare over government spending. Unnecessary because the rich have already won the war.

Assigned Reading: 'Do The Math' an article by Tom Murphy. It considers the place of energy in our universe and our place in the universe without it.

Been Down So Long: We think the recovery has been slow (or non-existent), but when compared to previous serious downturns, the current recovery is pretty average – the problem is not the rate of recovery but the depth we have to recover from.

Planning Plans: Boehner claims he's got a budget proposal that will cut government spending $3 to $4 trillion over 10 years. Call it $350 billion a year, or about what a second-rate hedge fund guru makes in a year. And he'd take it all out of entitlements. It this what all the noise has been about? $350 billion? We gave AIG almost that much...

Qui Bono? If the Bozos in Washington want to cut something, cut the funding for the War on Drugs, a colossal failure at home and abroad which has done nothing to stop drugs nor drug abuse. Time to step back, decriminalize and start behaving rationally. Of course there is far too much money on both sides of this charade for those in power on either side (or those in power at the top on both sides, which probably are the same people) to accept an end.

Porn O'Graph: Where the boys are.


OSR said...

Asked/Answered: Of course, urban agriculture can feed the world, much like there will always be enough oil. So long as the human population halves itself, there is plenty for everyone.

OSR said...

Qui/Bono: Actually, the War on Drugs has been a spectacular success once you realize it's true purpose.

Anonymous said...

RE: Been down so long

Fascinating! Someone should send it to Kudlow.

RE: Planning Plans
Pretty sure your thinking of millions not the billions. Or are you just being sarcastic and I owe you an apology?


CKMichaelson said...

Well, you most likely owe me an apology for one thing or another, Bill, but I was thinking billions because it comes out to be billions. If you are stumbling over the cost of the AIG bailout - you're right that I exaggerated. It was not $350 billion.

It was only $182 billion.