3 votes

Here's The Real Problem With The Economy

There's a lot of sturm und drang these days about who wrecked the economy. And there is a lot of yelling about how to fix it. But the economy is complicated, so it's easy to get fooled by someone who is yelling persuasively, especially if they play for your favorite political team.

Lots of things are wrong with the economy, but the main problem can be summed up with two simple facts:

Corporate profits are at an all-time high, and American wages are at an all-time low.

Some people argue that the way to fix the economy is to give tax cuts to the highest-earning Americans--the "job creators"--so that they can invest in new companies and create jobs. Well, we'd all like to pay fewer taxes, but unfortunately, the "tax cuts for the rich" approach almost certainly won't work. Here are a few reasons why:

The richest Americans and companies already have plenty of cash. The reason these rich Americans and companies aren't investing and "creating jobs" is that most American consumers (customers) are broke. Rich Americans actually don't "create jobs"--the whole economy creates jobs. We've been trying the "tax cuts for the rich" approach for three decades, and it is making the inequality problem worse, not better.

Now, some other people are arguing that the way to fix the economy is to increase taxes on the rich and companies and "redistribute" this wealth to American consumers. We will probably need to raise taxes on everyone a bit to reduce the budget deficit (even if we reduce spending--the gap is that big), but this "wealth redistribution" approach also almost certainly won't work. Here are a few reasons why:

The key to creating a sustainable economic recovery is to get the private-sector cranking, not the public sector. Having the government collect taxes and write checks to more than half the country to make things "fairer" will understandably ruffle the feathers of those who are paying those taxes. Class warfare won't help anyone. This is America: We solve our own problems in this country--we don't wait for someone else to come along and give us a handout.

So, then, if the answer isn't cutting taxes for rich Americans and companies, or raising taxes on the rich and giving the money to the poor, what's the answer?

Let's go back to the problem:

Corporate profits are at an all-time high, and American wages are at an all-time low.

If we want to fix today's ailing U.S. economy, we need many of our large corporations to share more of their vast wealth with their rank-and-file employees.

If the companies don't eventually see the benefit of doing this and do it voluntarily, the government (an extension of the people) will likely the mandate that they do it--either through taxation or by radically increasing the national minimum wage.
And given that government solutions are often terrible solutions, it would be best for everyone if we persuaded corporations to do this voluntarily. So what follows is an initial effort to do that.

Read more:
http://www.businessinsider.com/henry-ford-salary-increase-20...

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.

Are booms and bust cycles built into our monetary structures?

Here are some excerpts from 'Is Our Monetary Structure a Systemic Cause for Financial Instability? Evidence and Remedies from Nature', by Bernard Lietaer. This essay interestingly enough talks about the error of assuming that growth in the size of the economy is a sufficient measure of health AND it points out a remedy which allows for diversification in types of currencies, specifically through complementary currencies.

Why is the financial crisis of 2008 treated as if it were the first? The World Bank has identified more than 96 previous banking crises and 176 monetary crises since President Nixon introduced the floating exchange regime in the early 1970s (Caprio and Klingebiel, 1996). Even before this period, financial booms and bust cycles were, in Kindleberger’s words, a remarkably “hardy perennial” (Kindleberger, 1978); he inventories no less than 48 massive crashes between the 1637 tulip mania in Holland and the 1929 crash on Wall Street. In short, it may be tempting to consider financial and monetary instability as a given, as part of Schumpeter’s “creative destruction” of capitalism. But Schumpeter was referring mainly to the rise and fall of business units, not the monetary system. Could it be that a bug in the monetary system keeps crashing the operating system of capitalism, and that this has generated financial instability during the entire Modern capitalist era? Our view is that such repeated breakdowns, in very different countries and times, under different regulatory environments, and in economies with very different degrees of development, signal some underlying structural problem. If such a deeper mechanism is involved, it could explain why each new set of regulations achieves, at best, only a reduction in the frequency of banking and monetary crises, without getting rid of them and their horrific economic and socio-political consequences.

Fundamental laws govern all complex flow systems, including natural ecosystems, economic and financial systems. Natural ecosystems are practical exemplars of sustainability: enduring, vital, adaptive. The sustainability of any complex flow system can be measured with a single metric as an emergent property of its structural diversity and interconnectivity; it requires a balance in emphasis between efficiency and resilience. The urgent message for economics from nature is that the monoculture of national currencies, justified on the basis of market efficiency, generates structural instability in our global financial system. Economic sustainability therefore requires diversification in types of currencies, specifically through complementary currencies.

Until recently, total throughput and efficiency have been the only means for us to identify the relative success of a system, whether in nature or in economics. For example, in ecosystems, as in economies, size is generally measured as the total volume of system throughput/activity. Gross Domestic Product (GDP) measures size this way in economies and Total System Throughput (TST) does so in ecosystems. Many economists urge endless growth in size (GDP) because they assume that growth in size is a sufficient measure of health. GDP and TST, however, are both poor measures of sustainable viability because they ignore network structure. They cannot, for example, distinguish between a resilient economy and a bubble that is doomed to burst; or between healthy “development,” as Herman Daly (1997) describes it, or explosive growth in monetary exchanges simply due to runaway speculation.

http://www.scribd.com/doc/26248658/Is-Our-Monetary-Structure...

-
"Stand up for what you believe in. Even if you stand alone."
~ Sophie Magdalena Scholl
"Let it not be said that we did nothing."
~ Ron Paul
"You must be the change you want to see in the world."
~ Mahatma Gandhi

Liars or dupes?

If there is malicious intent to deceive, so as to gain at the expense of the intended victims of the lie, then it is called by many names, not making it any different, it is the same thing, one name of it is malice aforethought.

Why focus on half the truth?

If the lie perpetuates due to repetition, as people who are born into the lie, knowing nothing better, parrot the lie, the lie remains in FORCE.

Boom is intentionally followed by bust, and the lie that "they" are trying to sustain growth is half true.

"They" are sustaining the growth of their POWER at the expense of the victims.

The total sum of POWER can't be allowed to go ballistic, become ungovernable, for if that was allowed to happen, then POWER would be abundant, and "they" would be out of a job that "they" create as "they" make POWER abundant for them alone, and they exclude their victims from POWER abundance, as they make POWER scarce for those who actually create that POWER.

Focus on the BOOM and then claim that the BUST is a "natural" consequence of idiots who think that they can keep booming the economy forever?

That is half true?

The Business Cycle (Psycho) can be illustrated with an internal combustion engine where reciprocal motion (up and down) is turned into rotational motion (one way).

Add POWER (power to purchase or "money" and it isn't money if here is not power to purchase) and the cylinder goes one way, turning a hamster wheel, moving POWER from those who create it, ONE WAY, to those who steal it, so follow the money to that source, and find those who "give" out "our" money, to us, and thank them for the POWER, that BOOMS, while "they" get paid back the entire sum borrowed, plus interest, and "they" may pay a lot of people a decent wage along the way, but "they" get the actual "profits", during the BOOM.

"They" borrow from those who actually produce POWER, and "they" call you the borrower.

That is half the story, as the piston in the cylinder is driven down by the BOOM, and "they" loan only to those who play the game their way, exactly their way, no other way possible.

They have a way to keep POWER flowing ONE WAY.

From those who produce POWER to those who steal it, and use it to steal more.

The Monopoly way.

That BOOM is then followed by the "unfortunate" bust, as they continue to try to fix things, but fail, each time, every time, same fix, same problem, same fix, same problem, and they are too stupid to know that their solution to "our" problem is insane, since it never works, and since every time it is tried "our" problems is worsened.

They are so stupid.

Each time.

Then "we" all suffer, as Economic Collapse happens to "us", because they are so stupid?

But, the fine print is uncovered, and it is soon found out, if you care to look, that they also BOOM on the way down, as their POWER grows as much, or more, on the way down, as the way up, just like that hamster wheel in the engine, turned the same way, through an ingenious device, such as a crank shaft, or a one way bearing, just so long as POWER keeps flowing from those who create it, to those who steal it, so that the loot can be spent on stealing more, or all, in any case.

A crank case?

I'm called a monetary crank?

Really?

By who?

Why?

In whose interest is it to vote me down?

Have you read about the parasite city yet?

Consider someone, anywhere, having an interest in keeping you away from this information:

http://www.the-portal.org/mutual_banking.htm#4

The explanation of a Parasite City is 2 paragraphs long, not too costly, depending upon who measures the account, and by which method.

Joe

Is there a bug? No. Coin of the Realm fails by & by.

Three thousand years of monetary failure. Generally our world is awash in faith based currency... Modern "legal tender" is known as cash, credit, etc... No intrinsic value.

Search: "Coin of the Realm"

Giving any man privilege to make "Coin of the Realm" ... Be him King, Czar, Sultan, or Emperor... ends in nothing. Coin may be first made of Gold or Silver. Over the years, the coin gets spirited away, lighter, debased... With no intrinsic value... as confidence wanes, "Coin of the Realm" value goes to zero.

What commonly circulated "Coin of the Realm" is itself more than faith & confidence? Since 1971, the US Dollar lost it tenuous convertibility to gold.

For a more rational approach to business, please read: James 5. Further study: Leviticus 25.
____________________________________________________________________
__________________ Glossary of Economic Nonsense __________________

Gross Domestic Product = Sum of national accounts ... a measure of what was spent in a year, in a nation.

National Debt = Balance on national line-of-credit .... created out of thin air)

"Fiscal Cliff" = Line-of-credit limit ... a fearsome mythological beast w/o form nor substance

money, recursive supply of : see money, recursive supply of

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul

Bwa ha ha!

Solve the economic problems today with a libertarian approach! Sweet!

"Moderation in temper is always a virtue; but moderation in principle is always a vice." -- Thomas Paine

use the K.I.S.S principle.

what is the "economy" and why do we need one? does that even make sense?
what is this thing and why does it HAVE to grow? is that a wise course for humanity?
while I understand your points, and they are valid ones. I also think free, cheap clean energy is right around the corner....and I think we could have already had it....
it is only the "economy" that is the problem.
free energy would destroy the "economy"
we are living in very interesting times.....

Commerece may continue.

Commerce may continue with or w/o war, petulance or famine. With or w/o sound money. With or w/o honesty, integrity or valor.

Energy is contained with in every atom. From the lightest... to the heaviest.

  • #1 Hydrogen || The Sun
  • #2 Helium || The Hindenburg
  • #92 Uranium ||Hiroshima
  • #94 Plutonium || Bikini Atoll

This whole idea that energy must come from digging up carbon... Paying with carbon notes (paper-money) & credits (C+O2 thin air) may as well be fool's gold. Why build castles with ash piles. Carbon is element #6. Why is price so much based on carbon?

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul

The Hindenburg was filled w/ hydrogen when it burst into flames.

Airships used Helium when available as it was less volatile. The US was the major supplier of the day. The US blocked the sale of helium to Germany. Politics.

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul

The carbon tax

is mostly benign. No, I'm not saying that those at the top aren't using it to promote their agenda. I'm saying that the majority of those throughout the lower ranks are doing it because they genuinely believe it's the right thing to do.

This really isn't so much different than the bad economic players in the lower ranks who are making similarly bad decisions on the macro level just to survive on the micro level.

Both systems are designed very intentionally to have exactly that effect. Because of scarcity of wealth (at his level), anyone from the bottom up 9/10ths of the social ladder cannot give in and do something that might harm his future net worth path. Similarly, those who see the really devastating climate info are just going along with the carbon tax because they don't know of an alternative that could work.

The good news with both these problems, is that the solutions can come from the ground up and as they begin to be adopted, the entire system sees exponentially increasing benefits. Just like sound money will help the inflation problem, distributed and renewable energy will help the oil cartel monopoly problem.

We definitely need to kill the carbon tax scheme, just like the fiat/debt monetary scheme, but "end the fed" isn't going to do it in time. We need to show the world all the ways we can get off our perpetual 'monthly rent of services' model and begin trading them for a 'buy once, own and benefit forever' model.

Oh, and btw, the Hindenburg was Hydrogen #1.

Of course, the Hindenburg was Hydrogen #1. Thanks for noticing.

Sound money is key. Sound money trades for real value.

Managing our current Federal Reserve system of "legal tender" credit is but promissory notes chasing goods & services. No money. This is badly managed; carbon credits are a derivative on top to badly managed "legal tender." I suggest we rid ourselves of both. No Fed Notes. No carbon credits.

Why waste money buying & selling a new form of thin air? Carbon debits & credits?

The promise of paper Dollars pretending to be backed by gold... gold certificates... ended for US citizens in 1933~ 1934. Paper Dollars pretending to be backed by silver ended completely in 1965. gold certificates for foreign central banks ended in 1971 (See President Nixon speech: US temporarily closes gold window ).

Neither faith based paper-money nor carbon trading coupons will have intrinsic value. They are promises that someone else will pay. Both continue the racket of allowing someone to monetize a promise out of thin air.

Inflation is the increase of the money-supply. Every Dollar (whether loaned or carbon credited) into existence is inflation. If goods & services expand at the same rate as money-supply few realize those creating the money (by printing, crediting, or carboning) get a free ride.

Yes. The Hindenburg was filled with Hydrogen #1. Helium, as with all other elements, has vast potential energy. The US cornered (controlled) the Helium market. Helium is preferred for airships as it is less volatile compared to hydrogen. Interesting story.

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul

It Has To Grow Because The Population Grows

But you're right. I hate when people refer to the financial "system" or the banking "system." It's a subtle way of making it sound more complicated than it really is. The economy or "economic system" is just a bunch of vountary exchanges.

___________________________________________________________________________
"Bipartisan: both parties acting in concert to put both of their hands in your pocket."-Rothbard

Right, so the real question is....

how long can we continue to increase our population? if we have a monetary system that demands growth, and we keep trying to grow the economy......
we humans are really not very smart it would seem.

If you look at the RATE of change in population growth

it's been declining for a while now. It's also declining at a faster rate itself. If this trend continues (which numerous countries are set to wipe out their 6-10 for a 1-2 soon), then in 25 years or so, we'll be stagnant. The problem is that negative rates are nearly impossible to turn around. (Think of being told to bring a kid into this world during a war.)

While that doesn't sound bad, nor does the following reduction rate of 1.7 ish, what that means is that we could lose 15% of our population every 19 year generation. When you run that math, it puts us back under 500M in another 35 years.

Rates are using defined as being stagnant at 2.2 child being born per female to cover mortality.

Thank You

I think this subject might warrant its own thread.

In any case, I appreciate the information because I knew there was a decline--and a problem--but I wondered about the actual data.

___________________________________________________________________________
"Bipartisan: both parties acting in concert to put both of their hands in your pocket."-Rothbard

Understanding "The Cantillon Effect"

Written some time around 1730 Richard Cantillon's Essai sur la Nature du Commerce en Général (Essay on the Nature of Trade in General) was considered the first complete treatise on economics.

In this essay, Cantillon reflected upon how the increase and decrease in the quantity of money (and the interest on money) led to an inequality of wealth distribution that was in favor of those closest to the source of the new money.

This is the main foundation of "The Austrian Theory of the Trade Cycle" explored by the second generation of Austrian economists.

In order to understand the reasoning behind some of the arguments that may come your way as a result of this post, it would stand you in good stead to study these subjects and reflect on it's conclusions.

Much of your post points out the undeniable truth that somehow - by some hidden means - there has been an unequal and unfair distribution of wealth from the poorest in society up to the richest and most politically connected. On this we all agree!

But before any of us can suggest the best way to correct this most evidently abhorrent wealth transfer, we must first reveal the hidden mechanism behind it and be sure to prevent further repercussions.

As Bastiat wrote:

Men naturally rebel against the injustice of which they are victims. Thus, when plunder is organized by law for the profit of those who make the law, all the plundered classes try somehow to enter — by peaceful or revolutionary means — into the making of laws.

According to their degree of enlightenment, these plundered classes may propose one of two entirely different purposes when they attempt to attain political power: Either they may wish to stop lawful plunder, or they may wish to share in it.

Woe to the nation when this latter purpose prevails among the mass victims of lawful plunder when they, in turn, seize the power to make laws! Until that happens, the few practice lawful plunder upon the many, a common practice where the right to participate in the making of law is limited to a few persons. But then, participation in the making of law becomes universal. And then, men seek to balance their conflicting interests by universal plunder.

Instead of rooting out the injustices found in society, they make these injustices general. As soon as the plundered classes gain political power, they establish a system of reprisals against other classes. They do not abolish legal plunder. (This objective would demand more enlightenment than they possess.) Instead, they emulate their evil predecessors by participating in this legal plunder, even though it is against their own interests.

It is as if it were necessary, before a reign of justice appears, for everyone to suffer a cruel retribution — some for their evilness, and some for their lack of understanding.

~Frédéric Bastiat

The Law:
http://bastiat.org/en/the_law.html

If you do take the time to look into the subject matter presented in this reply, please let me know your thoughts.

I think we are all trying to solve the same problem, the only difference is the approach.

Great write-up Swifty.

You've better articulated what I well understand, but was impatiently unwilling to put down so thoroughly in my own post. Bravo!

Legal Competiton

I've spent over 2 decades teaching myself Political Economy and therefore any sincere effort by anyone to discussion Political Economy is an opportunity for me to test the validity of my perspective relative to theirs.

If enough Liberated people, in their own minds, decide to stop using the Legal Fraud Money produced by The FED, sanctioned by the criminals hired to run the National Government, and have ready competitive Legal Money to use instead of the Fraud Money, and do so by July 4th 2013, or a date sooner, or a date later, then, up to, and on that day, and on into the future, the problems currently associated with political economy, in this country, will be remedied.

If you see something I am not seeing, please let me know.

Joe

The first step doesn't have to be to stop using their fiat money

We can easily set up businesses that operate on their money (initially) but are designed ground up to operate without debt. That will yield vast prosperity which will begin to balance the inequality.

It will also yield the downfall of companies which operate based on debt, as they will no longer be near as profitable as those that aren't.

After that reaches some point, however, that is when we must begin using non-fiat currency for our transactions, as so much paying off of debt will inevitably restrict the supply of money.

First steps

May be false steps.

What is the first step?

Which business isn't subsidized (non-competitive) through the Legal Money Fraud?

Joe

Any business we start

where we use non-bank, non-vulture capitalist money to start it up. Look in to crowd funding and coop systems. There are many ways to do it these days but the key is to get sound money minded and non-debt minded people to start 'em. The profit then becomes self sustaining to the point that they're virtually unstoppable.

Confused

Using competitive money is not using Fraud Money, it is the same thing.

1.
Stop using Fraud Money
2.
Start using Competitive (higher quality and lower cost) Money
3.
Do so by a certain date

I thought I made that clear, but my words are often confusing to other people, and this is strange to me, as I have no problem understanding what I think, and write.

So...if one business (many people or a few people or even one person acting cooperatively) can start using a competitive money (no longer using the Fraud Money in that case), then who else uses that competitive money?

Anther individual, a family, a business, a family business, a neighborhood, a town, a city, a county?

What date does one switch from fraud to competition?

Three examples:

http://utopianist.com/2011/01/stimulus-writ-small-tiny-calif...

http://endthefedarkansas.com/docs/arbuck-circular.pdf

http://utahsoundmoney.org/home/index/78/0

Joe

I should have laid out my point better

I was not suggesting we need to switch to a different type of money (a la competitive vs. fraud or fiat). I was suggesting that our first step should be to not worry so much about what money we use but to instead, change where we get it.

If we get it from a bank or investor, the business we start up is in debt and will forever stay there. The costs of paying interest (sic) on that debt will keep said business forever in times of tough competition.

If we, for example, started our business from a co-op or crowd funding round, there is no long term debt. There is no administration control over how things are done so overhead is reduced. There is a sense of community and local prosperity so marketing is reduced (especially in a local based business). There are lots of expenses that virtually go away when you don't have a board of directors and a hoard of shareholders. This means you can cut both prices and raise wages - both things that foster yet more business and community. This is how the mom&pop shops have ran for centuries. They went away when a) they got suckered into going public and b) when their customers opted for long distanced quantity products over their local quality ones. Without debt based financing, businesses like this can return.

This process can be started by a single individual in a community and the prosperity he brings to himself, his employees and his customers will make it easier for the next person to do the same. I believe this would be much easier to get going than to persuade lots of people to start using JoBucks in place of dollars.

Personal Experience

"This is how the mom&pop shops have ran for centuries. They went away when a) they got suckered into going public and b) when their customers opted for long distanced quantity products over their local quality ones. Without debt based financing, businesses like this can return."

I do not know from which your perspective is founded, but mine is on much study and personal experience. My wife runs a Real Estate business, she is the entire enterprise, she is a Mom, her son is now a Real Estate Agent, and I help when I can, I also have a license.

We are a mom and pop enterprise in fact.

If we use Federal Reserve Notes we are playing the Monopoly Game and if we don't we are out of business.

If you do not understand that, or if my perspective is wrong, then there may be a way to resolve either condition.

I don't know, but your words appear to be contradictory to me.

As in:

"I was not suggesting we need to switch to a different type of money (a la competitive vs. fraud or fiat). I was suggesting that our first step should be to not worry so much about what money we use but to instead, change where we get it."

The FED is the source of Federal Reserve Notes, that is the single legal producer of the only Legal Money allowed within the reach of Unites States Incorporated (Limited Liability), and there are extreme costs associated with the connection between anyone working to produce anything of value in the Country (and much of the rest of the world) and what goes by the name The Dollar Hegemony, Wall Street, The Military Industrial Complex, Washington, The World Bank, The United Nations, The International Monetary FUND, or whatever False Front works best to hid the criminals behind their Fraud Money and Extortion Racket, and those costs are paid, so how can you use those Federal Reserve Notes and at the same time, in your words: "change where we get it"?

I do not understand the point. If you use Federal Reserve Notes, or if you are in any way connected to those criminals by their Legal Money Monopoly Power, using any dollar denominated asset, then either you are victim to the Fraud or you are investing in a potential return as an accessory to Fraud.

"I believe this would be much easier to get going than to persuade lots of people to start using JoBucks in place of dollars."

In my reality there was a Mom and Pop business working during the Boom and now there is a Mom and Pop business being busted, and the connecting medium is The Dollar, from personal experience, I know the root cause of our trouble, and if you do not, then all I can say is more power to you. I hope that you manage to work things out better than I can.

Joe

Cyril's picture

Fast forward to 17min 20sec - breathtakingly beautiful charts

Fast forward to 17min 20sec - breathtakingly beautiful charts :

http://www.youtube.com/watch?v=GitCvGFXi2M

Links to the sources are provided below his homework video.

Enjoy. (If I dare say.)

That's what we're up against. A Giant Ponzi Scheme.

"Cyril" pronounced "see real". I code stuff.

http://Laissez-Faire.Me/Liberty

"To study and not think is a waste. To think and not study is dangerous." -- Confucius

Listening to the Silver Link

I got to the part where the speaker suggests that "they" are stupid; meaning that the "central planners" or PTB are stupid, making mistakes, etc.

I stopped listening after that; how wrong can a person get if a person thinks that the most powerful people are "making mistakes" each time "they" try to fix the problem?

How does that work in a person's mind?

"They" have earnings, surplus wealth, credit, debt, whatever you want to call, or accurately measure the POWER flowing from those who produce it to those who steal it and then use the stolen loot to steal more, that "they", yes "they", "they" are trying to fix that problem where "they" keep filling their bank accounts up with more and more zeros, while "they" keep draining the bank accounts of everyone else, and "they" are trying to fix that problem?

"They" can't seem to ever find the right way to fix that problem as their bank accounts keep growing larger and everyone else has bank accounts that are growing smaller.

"They" appear to be going the wrong way, each new attempt to fix the problem results in the problem getting worse, where "they" have their bank accounts filling up even faster and everyone else has their bank accounts draining faster.

"They" can't seem to fix this:

http://www.usdebtclock.org/

"They" are too stupid to fix that effectively, measurably, so as to employ what power they have to accurately remedy that problem?

Really?

Joe

Cyril's picture

I agree with you this is mostly criminal

I agree with you this is mostly criminal.

But this is also religious (or superstitious) in bizarre ways :

have you heard about the Keynesians ? Mr. Paul Krugman ?

Those are "the thinkers" of the "money makers" (Bernanke et al).

See, their academia is rotten too :

http://www.dailypaul.com/264947/bunker-bear-kicks-keynesian-...

http://www.dailypaul.com/263316/dimensions-and-economics-som...

"Cyril" pronounced "see real". I code stuff.

http://Laissez-Faire.Me/Liberty

"To study and not think is a waste. To think and not study is dangerous." -- Confucius

Deception in Political Economy is not new.

How about this quote - for example:

_____________________________________
"But Hamilton wanted to go farther than debt assumption. He believed a funded national debt would assist in establishing public credit. By funding national debt, Hamilton envisioned the Congress setting aside a portion of tax revenues to pay each year's interest without an annual appropriation. Redemption of the principal would be left to the government's discretion. At the time Hamilton gave his Report on Public Credit, the national debt was $80 million. Though such a large figure shocked many Republicans who saw debt as a menace to be avoided, Hamilton perceived debt's benefits. "[I]n countries in which the national debt is properly funded, and the object of established confidence," explained Hamilton, "it assumes most of the purposes of money." Federal stock would be issued in exchange for state and national debt certificates, with interest on the stock running about 4.5 percent. To Republicans the debt proposals were heresy. The farmers and planters of the South, who were predominantly Republican, owed enormous sums to British creditors and thus had firsthand knowledge of the misery wrought by debt. Debt, as Hamilton himself noted, must be paid or credit is ruined. High levels of taxation, Republicans prognosticated, would be necessary just to pay the interest on the perpetual debt. Believing that this tax burden would fall on the yeoman farmers and eventually rise to European levels, Republicans opposed Hamilton's debt program.

"To help pay the interest on the debt, Hamilton convinced the Congress to pass an excise on whiskey. In Federalist N. 12, Hamilton noted that because "[t]he genius of the people will ill brook the inquisitive and peremptory spirit of excise law," such taxes would be little used by the national government. In power, the Secretary of the Treasury soon changed his mind and the tax on the production of whiskey rankled Americans living on the frontier. Cash was scarce in the West and the Frontiersmen used whiskey as an item of barter."
______________________________________________

That is found in this book:

http://www.amazon.com/Reclaiming-American-Revolution-Kentuck...

Or here:

_________________________________________
"When President George Washington ordered an army of 13,000 men to march west in 1794 to crush a tax rebellion among frontier farmers, he established a range of precedents that continues to define federal authority over localities today. The "Whiskey Rebellion" marked the first large-scale resistance to a law of the U.S. government under the Constitution. This classic confrontation between champions of liberty and defenders of order was long considered the most significant event in the first quarter-century of the new nation"
________________________________________

From here:

http://www.amazon.com/Whiskey-Rebellion-Frontier-Epilogue-Re...

Or this:

_________________________________________
"A number of characters, of the greatest eminence in this country, object to this government for its consolidating tendency. This is not imaginary. It is a formidable reality. If consolidation proves to be as mischievous to this country as it has been to other countries, what will the poor inhabitants of this country do? This government will operate like an ambuscade. It will destroy the state governments, and swallow the liberties of the people, without giving previous notice. If gentlemen are willing to run the hazard, let them run it; but I shall exculpate myself by my opposition and monitory warnings within these walls. But then comes paper money. We are at peace on this subject. Though this is a thing which that mighty federal Convention had no business with, yet I acknowledge that paper money would be the bane of this country. I detest it. Nothing can justify a people in resorting to it but extreme necessity. It is at rest, however, in this commonwealth. It is no longer solicited or advocated."
_____________________________________________

Word of the day competition?

How about ambuscade?

How about going back to the Day to Day Ratification (RAT-ification) to find this:

____________________________________________
Mr. GEORGE MASON. Mr. Chairman, whether the Constitution be good or bad, the present clause clearly discovers that it is a national government, and no longer a Confederation. I mean that clause which gives the first hint of the general government laying direct taxes. The assumption of this power of laying direct taxes does, of itself, entirely change the confederation of the states into one consolidated government. This power, being at discretion, unconfined, and without any kind of control, must carry every thing before it. The very idea of converting what was formerly a confederation to a consolidated government, is totally subversive of every principle which has hitherto governed us. This power is calculated to annihilate totally the state governments. Will the people of this great community submit to be individually taxed by two different and distinct powers? Will they suffer themselves to be doubly harassed? These two concurrent powers cannot exist long together; the one will destroy the other: the general government being paramount to, and in every respect more powerful than the state governments, the latter must give way to the former. Is it to be supposed that one national government will suit so extensive a country, embracing so many climates, and containing inhabitants so very different in manners, habits, and customs? It is ascertained, by history, that there never was a government over a very extensive country without destroying the liberties of the people: history also, supported by the opinions of the best writers, shows us that monarchy may suit a large territory, and despotic governments ever so extensive a country, but that popular governments can only exist in small territories. Is there a single example, on the face of the earth, to support a contrary opinion? Where is there one exception to this general rule? Was there ever an instance of a general national government extending over so extensive a country, abounding in such a variety of climates, &c., where the people retained their liberty? I solemnly declare that no man is a greater friend to a firm union of the American states than I am; but, sir, if this great end can be obtained without hazarding the rights of the people, why should we recur to such dangerous principles?
_______________________________________________

http://teachingamericanhistory.org/ratification/elliot/vol3/...

Call it anything but Crime made Legal, and to me you help cover it up with yet another False Front.

I'm just a nut case conspiracy theorist, though, and so to me it was a great help to find a fellow in the same light as Ron Paul one fine day in the 1980s, so I'm not alone - thanks.

1
End the FED (Monopoly Legal Fraud Money)
2.
End the IRS (Extortion made legal or "Direct Taxation" Monopoly)
3.
Bring the Troops Home (not to enforce one and two on the victims that are falsely called "tax payers" and "consumers" of FRAUD made legal)

Joe

Cyril's picture

Very interesting. Thank you for these pointers.

Very interesting. Thank you for these pointers.

"Cyril" pronounced "see real". I code stuff.

http://Laissez-Faire.Me/Liberty

"To study and not think is a waste. To think and not study is dangerous." -- Confucius

Not sure of your point.

That central banks can't buy silver is an important piece of info but not very relevant to what I was advocating. I don't know why I can't get this topic started on any post, comment or DP original, but IMHO, OUR first step should be to level the playing field at least enough to be able to stand upright without our assets being confiscated. That means that for us as individuals and as small business startup owners, we need to eliminate our debt. That single first step gains us so much ground that the next steps become very palatable.

Yes, indeed. It is one giant ponzi scheme.

Cyril's picture

Sorry I wasn't explicit

Sorry I wasn't explicit enough.

You wrote :

"It will also yield the downfall of companies which operate based on debt, as they will no longer be near as profitable as those that aren't."

This makes sense and is honorable. In fact, this is pure common sense to whoever understands money and free markets.

But you can't heal anything by striking at the symptoms only and postponing forever the treatment of the actual causes.

Yet again, this is very well simply explained here - http://www.laissez-faire.me/Economics

As long as we're stuck in this money-printing-driven ponzi scheme, not only for the (so-called) "legal tender" (just cottonware, actually) but now also including metal commodities with shorts over 100:1 if not 1000:1 ... we won't fix anything.

Interests rates DO serve this important signal function to businesses : invest when they give clues that consumers are saving, and lower costs, augment productivity when they give clues that consumers are spending and saving less - resp., when they rise or go down.

That is the fundamental self-regulating set of gears that run inside the supply-demand engine when you have sound money.

That makes up for two necessary pre-requisistes : sound money AND non-rigged, non centrally regulated (manipulated) interest rates - the exact opposite of what makes fractional reserve banking "work" ...

FOR THE THIEVES and CRONIES.

'HTH,

"Cyril" pronounced "see real". I code stuff.

http://Laissez-Faire.Me/Liberty

"To study and not think is a waste. To think and not study is dangerous." -- Confucius

Half credit?

Please, just as you state, be reasonable. What you suggest would reduce the chances of lost collateral. Collateral secured by debt is for the benefit of those that make you believe you own them. Some you do.

For those that create credit "out of thin air" ... They refer to it as "legal tender." It is difficult to avoid owing in their make-believe world of finance. That is, if even the very cash used to create your business... the cash you accept in payment for your goods & service is said same "out of thin air" promissory notes... If our government continues to authorize money-printing" ... funding out of thin air, "We the People" become ever more debtors. The current administration is funding our government in 100% promissory notes. Bank notes. Notes we print, then gift to the Fed, buy Treasury Bonds. Over half is covered in the return of promissory notes (tax payments). The other near half if simply piling on more National Debt.

Your suggestions are good. No argument against them. Half credit.
Our debt-money is not. No soundness to it.

Drop a silver coin on a counter. Listen to the difference between what is sound or not.

"Fiscal cliff" is rhetorical. Ain't worth a dime. It is but a bad sales campaign to remove the Fed credit limit. Legalizing "legal tender" to infinity. Hogwash w/o the hog.

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul