I hav spent the past 15 years attacking perpetual deficit spending. Economists and leftists all go "no, you just don't understand! Deficits run by governments aren't like deficits run by people!"
They're right, but they're also wrong.
Unlike debt run up by humans, governments are immortal. Governments generally don't go bankrupt. Also, governments don't really make their own money. They take your money.
Like debt run up by humans, it has an interest rate. If you get an introductory rate on a credit card of 1% and you run it up, then the rate becomes 30%, then you're on the hook for that 30%. You pay a lot more money to the bank, but you don't pay down your principal any more.
So here's what I see coming next: interest rates are rising. That's not avoidable. That means more of the budget will be sent to bankers and not spent on goods or services. Taxes will have to rise (you can't increase debt into a high interest rate environment without further increasing interest rates), services will have to collapse, and everyone will be screaming "austerity!!!" Like they know what they're talking about.
But it won't be austerity, it'll just be the laws of physics in action. Eventually you run out of someone else's money.
The accumulated debt, in the meantime, will be there after we're all dead. Our kids will pay for it, and our grandkids, and our great grandkids, because the state doesn't die and it doesn't go bankrupt. This is why I call long term government debt slavery, stealing from unborn generations who never got a choice as to whether their great grandparents got a stimmy check they paid for or not.
Some people think I'm crazy for thinking this way, but I think anyone worried about future generations who doesn't think this way is crazy.
They're right, but they're also wrong.
Unlike debt run up by humans, governments are immortal. Governments generally don't go bankrupt. Also, governments don't really make their own money. They take your money.
Like debt run up by humans, it has an interest rate. If you get an introductory rate on a credit card of 1% and you run it up, then the rate becomes 30%, then you're on the hook for that 30%. You pay a lot more money to the bank, but you don't pay down your principal any more.
So here's what I see coming next: interest rates are rising. That's not avoidable. That means more of the budget will be sent to bankers and not spent on goods or services. Taxes will have to rise (you can't increase debt into a high interest rate environment without further increasing interest rates), services will have to collapse, and everyone will be screaming "austerity!!!" Like they know what they're talking about.
But it won't be austerity, it'll just be the laws of physics in action. Eventually you run out of someone else's money.
The accumulated debt, in the meantime, will be there after we're all dead. Our kids will pay for it, and our grandkids, and our great grandkids, because the state doesn't die and it doesn't go bankrupt. This is why I call long term government debt slavery, stealing from unborn generations who never got a choice as to whether their great grandparents got a stimmy check they paid for or not.
Some people think I'm crazy for thinking this way, but I think anyone worried about future generations who doesn't think this way is crazy.
They aren't necessarily bankers, but bankers are going to be very likely to have the capital and the need for them. We will be sending more money to bankers.
The money printer I think will stop being an acceptable solution, we're seeing Japan as to why. As usual, their economy is ahead of the curve.
I don't think we've seen peak oil. I think we've seen peak fake green. The humanitarian crisis we'll see will get everyone investing in oil and gas, and anyone opposing it will find themselves unemployed.
The money printer I think will stop being an acceptable solution, we're seeing Japan as to why. As usual, their economy is ahead of the curve.
I don't think we've seen peak oil. I think we've seen peak fake green. The humanitarian crisis we'll see will get everyone investing in oil and gas, and anyone opposing it will find themselves unemployed.
Oil had been a victim of massive central planning and social engineering. As a result there's been a massive dearth of investment around the world except in authoritarian dictatorships where pretending to do something isn't on the menu.
The problem is that alternatives aren't alternatives, and we're seeing that now and we'll see it more moving forward.
The "magic environmentalism boxes" overwhelmingly work to make people feel good but don't produce power. We use overwhelming amounts of natural resources including fossil fuels to create these feel good boxes in authoritarian regimes then ship them over and increase electricity rates massively to produce virtually no power.
We can keep pretending we'll make power in winter with solar panels, and the mass graveyards will be a testament to how good we should feel about ourselves.
The problem is that alternatives aren't alternatives, and we're seeing that now and we'll see it more moving forward.
The "magic environmentalism boxes" overwhelmingly work to make people feel good but don't produce power. We use overwhelming amounts of natural resources including fossil fuels to create these feel good boxes in authoritarian regimes then ship them over and increase electricity rates massively to produce virtually no power.
We can keep pretending we'll make power in winter with solar panels, and the mass graveyards will be a testament to how good we should feel about ourselves.
I didn't realize how correct you are until I checked the M2 money supply and realized the federal debt is significantly larger than the entire money supply. Hoover up every free dollar and there'll still be more debt than the federal government had in 2008.
That's not true -- Judging from how much I paid for my 100 trillion dollar bill, Zimbabwean dollars are beating inflation!
The evidence to me that they are snickering behind our backs is the fact that practical sources of energy are still being actively stymied.
Hydroelectric has been a viable source of energy for a century, and instead of pushing for more hydro dams that actually stand a chance of fundamentally changing the energy make-up of many places, we're fighting for more magic boxes.
I don't think Nuclear is perfect for various reasons, but it does work on massive scales, and it hasn't even been looked at for 50 years.
The other thing I think matters is that instead of developing carbon resources in the first world, we're buying it from saudi arabia and putin instead. Those spots aren't special. There's oil and gas all sorts of places, but for some reason instead of developing resources in places with human rights, we keep shovelling money into authoritarian regimes. We just don't like human rights that much, I guess.
Hydroelectric has been a viable source of energy for a century, and instead of pushing for more hydro dams that actually stand a chance of fundamentally changing the energy make-up of many places, we're fighting for more magic boxes.
I don't think Nuclear is perfect for various reasons, but it does work on massive scales, and it hasn't even been looked at for 50 years.
The other thing I think matters is that instead of developing carbon resources in the first world, we're buying it from saudi arabia and putin instead. Those spots aren't special. There's oil and gas all sorts of places, but for some reason instead of developing resources in places with human rights, we keep shovelling money into authoritarian regimes. We just don't like human rights that much, I guess.
You owe 30% of 1.7976931348623157 × 10^300 dollars. Your interest is.... 0!
The plan is so crazy it just might work!
The plan is so crazy it just might work!
That's a really good point. They like Keyenes when his idea is to spend more money, but then the good times come and they're like "Oh, we should spend more money!"
I don't understand why the hatred of Hayek. Ultimately it wasn't Hayek but Keynes ideas that built the economic system for the next century. The unlimited spending and money printing is a criticism and prediction made by Hayek against the establishment, so the biggest problem is one he was explicitly against before it was widely understood.
So could you clarify somewhat?
So could you clarify somewhat?
- replies
- 1
- announces
- 1
- likes
- 1
The federal reserve was created in 1913. The real fiscal irresponsibility happened after Nixon "temporarily suspended" the convertibility of the dollar to gold, ending the Breton woods system that had been the global economic system since world war 2.
Now that isn't to say that Nixon or Reagan or any of the people after them were the very first people to be big spenders. FDR famously threatened the supreme Court in order to get his various social programs through, and many people point to Lyndon Johnson's Great society platform as the beginning of the end. Eisenhower warning us about the military industrial complex ended up being more important than we thought, not just because the military did end up with a inordinate amount of power, but because the perpetual wars and trying to pay for them ended up becoming one of the impetus for the elimination of the gold standard and ultimately the perpetual debt machine that we live in.
That being said, I think that neoliberalism and it's close friend neoconservatism ended up becoming the ideological base from which the military industrial complex was really able to ramp up. America might have been able to support strong social programs, but it couldn't support strong social programs at the same time as trying to support a military larger than the next 20 countries combined and bases in 97 countries.
Now that isn't to say that Nixon or Reagan or any of the people after them were the very first people to be big spenders. FDR famously threatened the supreme Court in order to get his various social programs through, and many people point to Lyndon Johnson's Great society platform as the beginning of the end. Eisenhower warning us about the military industrial complex ended up being more important than we thought, not just because the military did end up with a inordinate amount of power, but because the perpetual wars and trying to pay for them ended up becoming one of the impetus for the elimination of the gold standard and ultimately the perpetual debt machine that we live in.
That being said, I think that neoliberalism and it's close friend neoconservatism ended up becoming the ideological base from which the military industrial complex was really able to ramp up. America might have been able to support strong social programs, but it couldn't support strong social programs at the same time as trying to support a military larger than the next 20 countries combined and bases in 97 countries.