HAt Tip: Tigerhawk
Fat, blunt, funny, a northeast kind of guy, street smart, articulate, an attitude you find in the corridor from Philadelphia to New York City, Chris Christie is surprising folks by doing what he promised and that is trying to cut New Jersey politicians and public unions down to size.
Christie put forward a plan to eliminate $10.7 billion from New Jersey's massive $38 billion budget for 2011 -- a cut of nearly 30 percent. He has taken on the state teachers union, demanding that teachers take a one-year pay freeze and begin contributing something to their state pensions and health benefits. When the union balked, Christie called on New Jersey voters to send a message by defeating local school budgets at the polls. Voters responded by rejecting 54 percent of the school spending plans, the most since 1976.
You have to go to 1:10 and hear what he said about John Corzine. Below is what New Jersey was offered and took a pass on.
Once again, in the midst of our current depression (let's call it what it is) the debate heats up between the supply-siders and the demand-siders.
ReplyDeleteChristie represents the supply side as he derides "Bigger government, higher spending, more taxes." In a previous thread Rufus had a great link to a short Q&A with James Galbraith, the son of the legendary John Kenneth Galbraith, heir to the mantle of John Maynard Keynes, the father of demand side economics.
It's fascinating to watch an epic drama playout as characters like Obama and Corzine and Christie enter and exit the stage. It couldn't be any richer. The plot is pure classic; good v. evil, white v. black, demand side v supply side, Friedman versus Keynes. Free market democracy v. big government socialism.
We're witnessing a power struggle worthy of Shakespeare. Even the cast of characters is surreal. Look at Corzine, the man's a former CEO of Goldman Sachs! Even if his is a bit part, it serves to remind us that the issue at hand transcends the pettiness of political parties. Corzine walks across the stage in the shadows to remind us that Goldman has pulled the strings of all parties and principles. Could Shakespeare have written a better plot and penned a better villainous name than Goldman and doesn't Corzine look as though he came out of Central Casting?
Meanwhile, even as characters like Goldman exit stage left, new ones like Chris Christie enter stage right.
This story we're watching is so deep on so many levels that it is truly "a riddle wrapped in a mystery inside an enigma." It's fascinating and entertaining and thrilling with it's intrigue and hints of misstep, betrayal and disaster.
Oh, that it were Shakespeare.
And, the thing is, for James Galbreath's theories to be true you Must have the Chris Christies.
ReplyDeleteI'm sure that, over a beer, JK would tell you that, although a little deficit won't kill you, a few too many Corzines, and Obamas definitely will.
One thing the JKs of the world miss is: Our 30 year is only 4.5% because the bondholders are pretty confident that when things start getting "too far" out of control we'll find some Reagans, and Christies to step in and get things turned around.
ReplyDeleteSo far, they've been right.
"Fat, blunt, funny, a northeast kind of guy, street smart, articulate, an attitude you find in the corridor from Philadelphia to New York City"
ReplyDeleteLower Acela corridor: Trim, cagey, serious, worldly, maxed the Verbal. Oh, yeah. We've got you've people beat.
I'm siding with rufus, because I'm struggling to establish some cred as a liberal. I've got the burn barrel ready to go for Hayek, Mises, Friedman and suchlike. Freeing up space on the shelf for Keynes and Company.
Don't burn'em, Trish. Just don't worship'em. One more time. Repeat after me; Find a niche in the middle.
ReplyDeleteIn the end, it comes down to what your daddy always told you: Credit is a Wonderful thing; Just don't abuse it.
Roll out the barrel...we'll have a barrel of burn.
ReplyDeleteHappy Days are here again.
Keynes Rules!
NOT!
James Galbraith seems to ignore the fact that the economic stimulus amounts to the efforts of a old man with emphysema trying to inflate a big balloon. He can blow and blow for a long time before inflation.
The consequence of the demand side argument is wealth redistribution and a 23% VAT.
Wealth redistribution is the underlying agenda.
ReplyDeleteDon't forget it.
Of course it is, Whit. Some "Wealth Redistribution" is absolutely necessary to keep a Democracy going.
ReplyDeleteYou can argue against the "theory" of it until the cows come home, And Win. It doesn't matter. You've gotta have it.
"Austrianism," is like "Libertarianism." Great Theories, Absolutely Irrefutable Theories. But, they have to be tempered with the compassion of a little "wealth redistribution" to make the Mare Run.
We have the most successful Economy in the history of the world; and, although ours is basically a "Capitalist System," we have a fair amount of "socialism" built into it.
Power, whit, more so than wealth.
ReplyDeleteMoney & property are only measures, of success, not the whole game, in and of itself.
Power being exemplified not from the "level" playing field, but the ability to level it.
ReplyDeleteAnd that, amigo, is irreversible.
We are amongst the audience, and all the whirled is a stage.
"Repeat after me..."
ReplyDeleteThere can be no middle of the road, rufus; no acceptable Third Way or fundamental compromise. Slippery slopes, moral hazards, creeping mandates, blah, blah, blah. Before you know it, we're the DDR.
I did read National Review for about fifteen years, you know. The mindset which dictates stark either-or's - which vilifies the moderate - is a hard one to shake.
The wealth demanded from the Federals, to maintain themselves in power along with the continuation of the Military Industrial Complex economy we've created, enough to bankrupt our 310 million residents.
ReplyDeleteWhit, damd good writing.
ReplyDeleteWell, Trish, if your "job" is to draw "Readers," or "get votes" there Can Be NO "middle way;" that is a fact. You will become poor in the first instance, and be "unelectable" in the second instance. One Must "excite" someone.
ReplyDeleteBUT, for me, and thee, it's different. We're neither Pundits, nor Politicians. We have the luxury of thought.
It doesn't accomplish much, but it fills the day.
Because, there is not one tank, one aircraft carrier battle group, nor even an M16A2 that has any productive economic value.
ReplyDeleteEvery dime spent on our nuclear capacity, wasted, from an economic growth perspective.
The US borrows and spends wealth in the pursuit of military security, that, if what we have in already stock is insufficient to the task, can never be achieved.
We've gone from being concerned about the Russian Bear, the Warsaw Pact, to fretting over border bandits in Pakistan.
ReplyDeleteWhile the cultural fear level is higher now, than ever before, here in the USA, with much, much less reason.
There is no credible military threat, to the "West", nor US.
Yet we continue to fear the foreigners and "arm up".
The audience unwilling to look behind the curtain to see the next stage sets being prepped.
You can make Galbraith work. The problem is allowing the inordinate aqmount of holding of US bonds by foreign governments especially China and emerging mercantilists.
ReplyDeletePlow money into bond financed infrastructure, the bonds being retired by the user fees generated from the infrastructure, the bond holders being domestic entities, keep developing until you have full employment and pull back when you reach full employment, and you can spend as much money as you want.
I don't know, Rat. The siren song of investing in a Country that is committed to being the Strongest Nation, Militarily, in the World, Many Times Over, is very enchanting.
ReplyDeleteIt's got to be worth a "couple" of ticks in the price of a bond.
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ReplyDeleteSome "Wealth Redistribution" is absolutely necessary to keep a Democracy going.
ReplyDeleteThe question is which form of wealth redistribution is more preferable.
A redistribution which occurs through the market exchange of goods and services or that which occurs through taxation and social spending. You're right about the need for balance, but right now, we need a constant vigilance against leftist usurpers, the hyenas, who sense an opportunity in the crisis.
We're up to our necks in crooks, we don't need the envious, dysfunctional left bringing us to dystopia.
"One Must 'excite' someone."
ReplyDeleteSo many Elmer Gantry's. Fuck the lot of 'em.
We have that, already, rufus.
ReplyDeleteThere is no need for "more".
Exemplified by the F22, a fine piece of technology, but unneeded in the real whirled.
Nice to have, perhaps, but we already have them. You'd "like" more of them. But there is no compelling need, there is no threat that they meet.
And technological progress has already made them economically obsolete. UAVs can and will do the same job, on the cheap.
When 42% of every dollar spent is borrowed, spending more effectively is paramount.
Pardon my English.
ReplyDeleteIf I were going to try to teach one of my kids "Economics," (That would be an adventure) I would start with Adam Smith, and the Austrians. Spend a few minutes with Uncle Miltie.
ReplyDeleteThen a bit of Samuel Clemons, and finish up with just a touch of Galbreath, and Keynes.
The goal, a worthy one, to build infrastructure , a legacy to future generations and generate wealth for current American workers.
ReplyDeleteWhy are we pouring billions into failed banks at 0% interest because they got into trouble when we do just the opposite to an American worker.
If he loses his job because a bank failed and some greedy fools on Wall Street, the system increase his credit lines to 30% interest or withdraws them completly. That goes on his credit report , increase his insurance rates, keeps him from getting a job or financing a car.
0% for the banks and money wizards and speculators and credit scores and 30% penury for the shlubs.
WTF
That would be the first week. The next 26 days would be to start with 1920 and spend a day on every year until 1945. Actually, if you did that you could probably skip the first week.
ReplyDeleteWhile having a nuclear military capacity, and spending outrageous sums to obtain it, did not help South Africa reach economic independence.
ReplyDeleteNor did it help the Soviet bond ratings.
Not at all.
Whirled military dominance, well it bankrupted England.
Eventually destroyed Rome.
Plow money into bond financed infrastructure, the bonds being retired by the user fees generated from the infrastructure...
ReplyDeleteDemand siders insist that the best spending is the Big Government spending on the big domestic public works projects. I don't deny that we need the infrastructure spending, but I don't know if we can afford it or if it will be a repeat of the prolonged Great Depression.
Sounds like NRA, New Deal, WPA all over again.
Nobody said it wuz easy.
ReplyDeleteThe bankers, Deuce, are 'Boners', the vast mass of shlubs, they are not.
ReplyDeleteThe Federals look out for their own, like any other tribal subset.
Ronald Wilson Reagan was a "New Deal" Democrat, until the day he died, so no worries.
ReplyDelete"If I were going to try to teach one of my kids 'Economics'"
ReplyDeleteFunny, one of our kids is an economics major - and began with Hazlitt in high school - and insists that the great, still largely unexplored realm of behavioral economics is where it's at.
Majoring in Economics with an emphasis on behavioral economics.
ReplyDeleteMay as well throw in a year of astrology. :)
No Whit, the key is the issuing of the bonds for the project and retiring the bands from the user fees. All projects become self funding. That is entirely different from what happens now.
ReplyDeleteThe US government issues bonds to refinance existing bonds. The bond holders are foreign governments that take the cash stream from the bonds and use it to finance their mercantilism.
The Chinese can issue their own infrastructure bonds and finance their infrastructure bonds with the cash stream from their US bond holdings.
None of the economic benefit flows into the US economy. There is a huge difference with my proposal. My proposal works. The treasury funding and refunding existing US debt to finance current government spending is a tax on US workers with the cash flow transferred to the Chinese bond holders.
No Whit, the key is the issuing of the bonds for the project and retiring the bands from the user fees.
ReplyDeleteI like it!
Our financial system is a mess. The "Big" banks have become almost worthless to the economy. Basically, just gambling houses.
ReplyDeleteIt's going to be impossible for the Congress to punish them "too much" in my eyes. I keep thinking of "Tar and Feathers."
The "Big Banks," and Brokerages are the only things that really, honestly, Scare me. If we have an Achilles Heel, as a Country, it's there. They are So powerful that I doubt that they can ever be reined in. I truly believe the government should take an axe to them, and cut them within an inch of their lives. In fact, I'd like to see a couple (and, I don't care which ones) arbitrarily Shut Down.
Capitalism doesn't work without fear. Those people have nothing to be afraid of. We really, really need to give them something to be "afraid" of.
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ReplyDeleteThat is how the Chinese fund their infrastructure.
ReplyDeleteRat is correct about what we use our wealth on.
The Chinese way is sustaianble as long as we are stupid and ours is unsustainable because by all accounts we will remain stupid well into the distant future.
Interesting economics argument. I wish I had more time at the moment to read them thoroughly and respond in kind. In short beware anyone who writes "If the markets thought..."
ReplyDeleteIn short I think the whole deficit/debt thing revolves around how much of the deficit is monetized. How many bonds are sold to the public to cover the deficit versus the central bank 'buying' the bonds? If you need to roll over the existing bonds and issue new ones to the public you are subject the what the 'bond market thinks'. If the fed mops up any surplus then you have to watch inflation. Currently, it seems, so much money has 'disappeared' that inflation still doesn't seem to be that much of a risk. Greece, nor Spain, don't have the luxury of their 'fed' mopping up the bonds - the ECB has jumped in and said it will now...
In the end, though, the bond markets are to be feared and compliant central banks necessary, but rampant inflation can be awful.
gotta fly...
By the way, after watching that clip for at least five times with Christie untethered to a teleprompter, how would you like to see him debating Obama in a presidential race?
ReplyDelete"May as well throw in a year of astrology."
ReplyDeleteActually, it's the s'marvelous University of Chicago which has done the ground-breaking in that area.
But for the present she's pushing econ into the background and piling on yet more French. Determined to make her way back overseas. Deutsche Bank or (wait for it) the UN. It's a tossup.
Hard to go wrong with, either, Deutsche Bank, or the U.N.
ReplyDeleteTwo Excellent Career Paths.
I just wish to hell Christie had a full term under his belt.
ReplyDeleteThat could be a show.
Deuce, I saw the video of the press conference, elsewhere; but do you have a link for the second video?
ReplyDelete4 U, rufus
ReplyDeleteRufus. Go to the basement. Open one of those old pretzel cans, unroll a few of those rolled Franklins and buy yourself a Mac. In the meantime:
ReplyDeleteGO Here PAL
That worked well, Rat's is the second video, my link is the first.
ReplyDeleteI slipped in a post Drugs and Murder on the Border which has some interesting background on the recent murder of a rancher in Douglas, Arizona.
ReplyDeleteThanks, guys.
ReplyDeleteWhat does he mean, "he hauled off?" Where did he "haul" it to? Why didn't he call the DEA? The Border Patrol? The State Police?
ReplyDeleteWhy was he "helping" illegals, instead of calling the authorities? Would the "authorities" not respond?
I still feel like we're only getting a part of the story.
"Why didn't he call the DEA? The Border Patrol? The State Police?"
ReplyDeleteMaybe he did. Or maybe he didn't want to call federal attention to his property as a storage and transfer point. That can be thorny.
They can't secure their own property and unless things have changed in a few short years, there's nothing down there in Cochise (apart from the entry at Nogales) but a concertina'd fence running through wide open country. And unlike the last time we lived there - almost eighteen years ago now - the hills are littered everywhere with the cast-offs of illegals. It's a little creepy.
That he and others would be targeted for messing with someone's cache, is absolutely believable.
ReplyDeleteIt's a damned if they do/damned if they don't situation.
ReplyDeleteThe more sand that has escaped from the hourglass of our life, the clearer we should foresee through it.
ReplyDeletehttp://www.redstate.com/users/miguel2mcguire/