“Soft despotism is a term coined by Alexis de Tocqueville describing the state into which a country overrun by "a network of small complicated rules" might degrade. Soft despotism is different from despotism (also called 'hard despotism') in the sense that it is not obvious to the people."

Thursday, January 29, 2009

Who is to blame?

Some very very smart people are very very worried, and they should be.

Too many people that should have known better did not do their jobs.

Tax codes, regulations, lack of regulations, social engineering, a disproportionate and insane investment in residential real estate, a war we never needed, a prescription medicare program paid for by borrowing from the Chinese. Buying with borrowed money and leveraging our homes all as if it would all never end.

The Republicans now are piously seeing too much government spending. What did I miss over the last eight years?

News Corp.’s Murdoch Says No Hiding From Credit Woes

By Christine Harper and Kristen Schweizer

Jan. 28 (Bloomberg) --
News Corp. Chairman Rupert Murdoch said there’s no hiding from the worsening global economic crisis, and stressed the need for quick and “drastic action” to turn the tide.

People worldwide are “depressed and traumatized” to see their life savings, including homes and pension funds, disappearing, Murdoch said at a press briefing in Davos, Switzerland, today.

“It would be very foolish if we said here we are, we had a crisis, and how do we get out of it quickly,” he said. “The crisis is getting worse. When you get to the real economy, values are still going down.”

New York-based media company News Corp. in November reduced its fiscal 2009 profit forecast because of reduced ad sales at its newspapers and Fox television.

“You have world financial markets, it doesn’t really matter where you’re talking about in the world,” Murdoch said. “There’s no hiding place, the world financial markets are in a great state of disarray.”


  1. Tax breaks are not going to fix this problem, neither is creating more government entitlement programs based on foreign financing. Denial that there was even a problem has taken a very serious toll.

    The Democrats are tempted to implement their social spending lists and call it a plan for recovery. We may have missed the time frame where this can be controlled. If that is the case, we may yet see something that no living person ever has. Economists like to call it creative destruction. Neat phrase but not in implementation.

    Get used to seeing this:

    "The gloom surrounding this year’s World Economic Forum descended into confrontation yesterday as international labour leaders launched a withering attack on the 1,400 business executives and 41 heads of government at Davos over what the labour leaders alleged was their failure to respond effectively to a deepening crisis of their own creation.

    Guy Ryder, the general secretary of the International Trade Union Confederation (ITUC), said that the current financial turmoil had triggered a social timebomb that would lead to deepening civil unrest and soaring crime."

  2. How can a decrease in capital gains tax do any good in a market where people are not investing? Who is going to buy what you are selling?

    I doubt there are one in ten in Congress that really understand economics, and they are the ones steering the ship.

  3. The financial system as currently set up needs growth to sustain it. Loans + interest. With peak oil and peak resources now at force, growth is replaced with decline. We need a system that can better handle this.

  4. This will solve the problem:

    "The price of oil has to rise to between $60 and $80 a barrel to safeguard investments, according to the bosses of oil cartel Opec and top energy firms.
    The downturn had resulted in "dangerous demand destruction", said Opec Secretary-General Abdalla El Badri.

    He said Opec would cut production further, if prices did not recover."

  5. Oil is a dead end. The faster the transition from an oil economy, the better.

  6. Thorium reactors for base load could be something to look into. Bob?

  7. How quickly could a nuclear power plant be built if a common design were used and if they were put on military bases minimizing the legal impediments? Say you authorized 100. That would be infrastructure with a serious long term return on investment.

  8. CWP class cancelled, dang, was looking forward to another good video.

    That debt chart looks bad, but it needs a lot a adjustment for the growth in the size of the economy in all those years.

    I've often wondered how, and been surprised that, a modern, highly complex industrial economy works at all. This isn't grandfather's world.

    I don't think anybody really has much of a clue what to do. Sooner rather that later Obama will be owning this problem, and with justice too. From Fannie and Freddie to nixing any sane energy solution, they are at the heart of it.

  9. I would bet they could be built for $2 billion each. $800 billion would pay for 400.

  10. First off, those numbers include the Soc Sec hocus-pocus (money the right pocket owes to the left pocket.)

    The real national debt (that money that we owe to bond-holders) is a bit south of 6T.

    To put the chart into perspective you'd have to juxtapose it onto a chart of GDP. Remember, all charts go parabolic, eventually. It's a function of non-logarithmic graphing.

    Anyhoo, Debt Service is less than 3% of GDP. No biggie.

  11. The "common design" is only common because it is used to produce nuclear weapons. Thorium is far more abundant than uranium-235, but thorium reactors do not produce the material used for nuclear weapons. Thorium reactors are safer to operate, producing little radioactive threat outside their shielding, and cannot experience a catastrophic meltdown.

  12. Dr. Bill has said there are some sites already approved much earlier, and never utilized, still just sitting there waiting.

    Don't know about a time scale actual building, but most of the time is taken mucking around in the process and law suits. You got to get the couty commissioners, of all people! to approve, you know.

    I'd bet the actuall construction would only take 3, 4 years. Who knows, maybe less.

    To open up the military bases, the Commander in Chief would have to approve, would he not? What are the chances of that?

  13. Eh, probably more like $20 Billion, each, Deuce. The latest price on those two they're wanting to build in Fl are around $17 B, and they're not "first of a kind."

    Anyway, we're okay for "Electric," pretty much. It's the liquid fuel that's going to keep us in, and out of, recession for the next ten, or twelve years.

  14. Debt Service is less than 3% of GDP

    What is it in terms of a percentage of gov income?

  15. I guess around 10% of Current government income, Mat. Remember, though, government income tends to rise with Nominal GDP (on average around 5.5%, I guess,) whereas we tend to increase our debt about 1.0 to 2.0%, annually.

  16. Blogger Mətušélaḥ said...

    "The financial system as currently set up needs growth to sustain it."

    yeppers, smartest thing you've ever posted in my view. That's been a stick in my craw for a long time - everything is based on growth. If we have low growth or, god forbid as we have now, negative growth, my my the gnashing of teeth. At the heart of it lies population growth. As we reach the saturation point for population growth so to do we reach the limits of economic growth. In fact, we in the western world have plenty to eat and some sort of roof over our head in times of negative growth. No new flat screen TV but enough to eat, no problem.

  17. Also, don't get too excited over "$800Billion Stimulus," and such. A lot of this money was going to get spent, anyway; plus that amount that really does get spent will get spent over, in some cases, ten, or twenty year.

    Lots a' Sturm n' Drang, and high-level "Politik'n" goin on, right now.

    So far, we're in kind of a garden-variety recession. Not nearly as bad as the ones in the early 80's.

  18. It is a bizarre concept that we must always have a growing population in order to prosper. The operative word should be productivity. That requires innovation, capital and savings.

  19. I think I will buy Rufus a drink.

  20. I Garuntee you, Rufus will Drink It.

  21. Deuce, it's not only "bizarre," it's quite obviously, Wrong. I don't know where this particular theory got started, but I can find no rationalization for it, whatsoever.

  22. Mat, Ash, Duece, Rufus and Bob all agreeing on something? Hell, I can't believe it.

    Drinks all around.

  23. This fellow, duece, agrees that savings are important, but that we're past the point of a savings meltdown. He sidputes rufus's point that it was worse in the 1980's, I'd have to agree. It is worse here, now, than it was then.

    Because even as the government tries to get consumers to spend more, there's a powerful force making them spend less—a force we haven't had to contend with in other recessions. To understand this force and just how powerful it is, you need to understand the savings deficit and its repercussions.

    Through most of the postwar years, Americans saved roughly 9 percent to 10 percent of their incomes. During the last two decades, that number steadily went down, until sometime around 2005—the exact point depends a bit on how you measure savings—when the U.S. personal savings rate hit zero, another way of saying that Americans spent pretty much every cent they earned. The moment was a two-day story in the papers, which generally noted that this was the only time in 20th-century history that an industrial country had negative savings in a period of economic growth and the first time the U.S. savings rate had hit zero since the depths of the Depression.

    It takes but a moment of thinking to see why savings rates would have hit bottom in the Depression: In times of economic trouble, people take money out of their savings instead of putting it in. We all get that. Savings are a financial cushion, and having savings that can be withdrawn and turned into spending gives us a natural "stimulus package" that evens out the economic cycle.

    With this in mind, you can start to see just how extraordinary the zero savings rate of the last few years was. Because if American consumers saved nothing when the economy was good, what are we to do when the economy is bad? Spend even more?

    When we start with a savings rate of zero, finding a way to keep up consumer spending is much, much harder.

    In this sense, our situation is actually worse than that of Japan in the ‘90s, when it suffered an extended period of slow growth and economic stagnation. Japan's savings rate then was generally in the range of 10 percent or more. The Japanese had plenty of room to cut their savings and spend more, and as they did, the economy picked up (Japan's savings rate is now a quite low 2 percent). Japanese consumers had the option of saving less and spending more. We don't.

    Savings and MoanAmericans are finally stashing more money away—and that’s a bad thing.
    By Mark Gimein

  24. As we reach the saturation point for population growth so to do we reach the limits of economic growth.

    Getting rid of the 1.5 billion useless Islamists will go a long way to alleviate that.

  25. Drinks all around.

    A toast to see the 1.5 billion dead Islamists!

  26. In the 1980s the Germans came to town with money to spare.
    In the midst of the US downturn, other economies flourished.

    There are no Germans this time around. Not a single Jap or Chinese investor. The Canadians are even staying home.

    The export market has collapsed, exemplified by the downturn at Catapiller, where 20,000 workers were just laid off.

    Also exemplified by the stories of the cargo ships, sitting empty in Singapore, while oil tankers are used as floating storage facilities at sea.

  27. There are a lot of little neo-commies that are praying that this will be the "blow-up" that sends Capitalism to the dust-bin of history.

    About 90% of them comment, and post over at the oil drum. That's where I first ran into the theory that capitalism is dependent on credit growth. I guess they've extrapolated credit growth out to "population" growth.

    It's all, basically, silliness. We will have "growth," of course, due to the exponential increases in science, and technology.

  28. Lewis Clark State College has record enrollment this spring. Enrollment never goes up in the spring, but it did this time. I don't know about the figures for U of I or WSU yet.

    Our universities are usually countercyclical to the business fortunes of our country.

    On the other hand, funding has been cut back in many programs, and there are other belt tightening policies going into effect around the state. Idaho's state budget has been cut back alot.

    One business in little Genesee, Idaho ,that used to make some kind of matting for soil erosion control, used in and around building projects, folded not too long ago. Much other cutting back going on around too.

    So it is definitely hitting here.

  29. This deal did have the potential of being a "Horrible" Depression. If the Big Banks had gone under it would have been a "Crash" of Biblical Proportions.

    They didn't, and now we're just waiting to see how long it takes to unravel the whole idiotic mess.

    It's all bout housing (as are most recessions.) We'll probably level off (at the bottom) in the second quarter, but it might take another two, or three quarters (or more) before we actually start "growing" again.

    Rat, I was thinking about the National Unemployment Rate. I'd have to look it up, but I seem to remember it was up around 10%, maybe a touch less, in the early 80's.

  30. Acting finance minister Patrick Chinamasa said scrapping foreign exchange controls was necessary to tackle hyperinflation, last measured at 231 million per cent. Although the central bank has slashed 13 zeroes from the Zimbabwe dollar over the past three years, the currency is virtually worthless; the newest banknotes carry face values of up to $100 trillion.

    Chinamasa acknowledged in his budget speech yesterday that there was already a huge black market trade in foreign exchange.

    Workers from teachers to doctors to bus drivers have all staged strikes to demand salary payments in South African rand or US dollars. But Chinamasa said that, while civil servants' salaries would be adjusted for inflation, they would still be paid in local currency.

    Zimbabwean Currency Worthless

  31. If the Big Banks had gone under it would have been a "Crash" of Biblical Proportions.

    Some argue that they've been zombiefied. And that we still face cascading failures as long as our society is arranged around oil and NG.

  32. Headline: "Global confidence in innovation holds despite weak economy"

    Of-course, none of that scientific innovation will come from dar al islam.

  33. The Australian share market is lower after a night of heavy falls on overseas markets.


    Miners were lower after the Reuters/CRB Jefferies commodity price index eased 0.4% overnight.

    BHP Billiton lost 65 cents, or 2.1%, to $30.00, while Rio Tinto was down $1.54, or 3.8%, at $39.17.


    The big banks were all lower. The Commonwealth Bank was down 91 cents, or 3.4%, at $25.99, while NAB was recently trading at $18.38, a fall of 30 cents, or 1.6%.

    Stocks Cut Losses

  34. Of course, none of that scientific innovation will come from dar al islam.

    Right about that, unless it's some new and innovative torture techinique, or new unprofitable way to exploit women and children.

  35. For Sam, in case you missed it--

    You're in a cold spell, Sam.

    And, what's 156 degrees Fahrenheit in comparison to attaining androgyny?

    "When the boys have died their death to childhood and survived their painful metamorphosis into incarnations of the original androgynous being, they are told that they have no further operations to fear.....

    The great festival of initiatory rites at the conclusion of which the double tjurunga is exposed is known as the Engwura ceremony, and the detailed account of its pantomimes in the work of Spencer and Gillen occupies more than 100 pages. The ceremonies are conducted by a number of tribal groups, which have come together with some eighteen or twenty young men to be initiated, and the festal spirit, growing greater and greater from week to week, keeps the whole company, by some miracle of the gods, from collapsing in sheer fatigue. The daytime temperature at times reaches a broiling hundred and fifty-six degrees Fahrenheit;(*83--Spencer and Gillen); nevertheless, the rites go on unabated, and if anyone dies of sunstroke the blame is placed on the black magic of some alien tribe."

    Joseph Campbell "The Masks of God: Primitive Mythology" The Imprints of Experience

  36. When one of the mosques gets a visit from the security service AIVD, who follow the youth, they are called in by the administration and warned.


    Removing the feeling of injustice by groups of Muslims would help in the struggle against radicalizing youth. Also it is important to promote the relationship of immigrants with their surroundings, offer Muslim youth democratic alternatives and pay more attention to their question for their identity.

    Additionally the researchers warn of isolation. "That the youth are kicked out of mosques for fear of a bad name and for fear of the AIVD, is from that point of view not a good development.


  37. Thanks, Bob. I did miss it.

    156'? Where's that?

  38. Kewl :)

    Researchers cool CPUs with nano-size fridges

    Intel, RTI and ASU are developing a micro-refrigerator that can be mounted on chips

    Eric Lai

    January 29, 2009 (Computerworld) Cramming ever more transistors into CPUs has not troubled chip makers Intel Corp. and AMD Inc. The problem, rather, has been how to handle the extreme heat generated by the movement of so many electrons in such a tiny space.

    With heat sinks and fans not up to the task of cooling the 100 degree Celsius and greater chips, makers stopped trying to raise processor speeds several years ago and moved to building multi-core CPUs instead.

    Gamers and performance fanatics responded by usingwater, liquid nitrogen and other exotic liquids to cool their overclocked CPUs.

    And it's not just overclockers pushing the envelope. AMD has gotten into the act, this month enabling its new Phenom II desktop processor to run at a record 6.5 GHz by cooling it with liquid nitrogen. And liquid cooling is even gaining interest from the far-more-conservative server and data center crowd.

    However, the danger of mixing liquids with electronics remains, despite containment efforts.
    Chip cooling's next generation

    Now, a more elegant solution is on the horizon. Researchers at Intel, RTI International and Arizona State University have developed a micro-refrigerator that can be easily mounted on chips to draw heat from hot spots with surgical precision.

    That would allow these nano-scale (10 micron) systems to be smaller and use less electricity than conventional heat sinks, fans or liquid setups, said Dr. Rama Venkatasubramanian, a senior researcher at RTI and a co-author of a paper published this month in the scientific journal Nature Nanotechnology.

    The refrigerator in your kitchen uses a mechanical heat pump to compress and circulate a coolant liquid that absorbs heat inside the fridge and dissipates it outside.

    The micro-refrigerator is quite different. It is a super-thin film made from thermoelectric molecules such as Bismuth telluride and Antimony telluride.

    Thermoelectric materials such as these convert heat into electricity. In other words, "you're using electrons to pump heat away," Venkatasubramanian said.

    Venkatasubramanian and the other researchers have been able to reduce heat on a simulated CPU by 15 degrees Celsius. But he is optimistic that by using more thermally-conductive materials on the silicon chip, such as improved solder or even carbon nanotubes, the micro-refrigerator could help cool a chip by as much as 40 degrees Celsius.

    Such a drastic reduction would allow a chip to run faster or a chipmaker to cram even more transistors onto single or multiple cores.

    Another advantage of a micro-refrigerator would be its efficiency. Each cooler would be targeted at hot spots on the rear of the chip and use only between 2 and 3 watts when active.

    "This is cooling on demand," Venkatasubramanian said.

    The closest analogy is to the ice packs that marathon runners wrap around their necks during races, he said. "Because of the large amount of blood supplied to your head and neck area, you can bring your core body temperature down quickly and continue racing."

    Cooler CPUs on the horizon
    Funded via DARPA grants, the technology is being brought to market by an RTI spinoff, Nextreme Thermal Solutions Inc., where Venkatasubramanian served as CTO for two years.

    It might already be used by Intel or AMD if they hadn't gone the multi-core route, he said. Venkatasubramanian predicts that within 3 to 4 years, chipmakers won't be able to continue boosting CPU performance without seeking alternative solutions such as with micro-refrigeration.

    Graphic chip makers have also "shown interest in our hot-spot cooling technology as well, as they do get hot in some selective areas when they are running at blistering speed," Venkatasubramanian said.

    For all their promise, Venkatasubramanian said that thermoelectric solutions like this aren't intended to replace heat sinks or fans, but complement them.

    As the micro-refrigerator draws heat, it also generates electricity. But Venkatasubramanian said the technology would not work like a hybrid car such as Toyota's Prius. The devices are hampered because with the more heat they draw, the less electricity they are able to generate. "You can't get something from nothing. You can't violate the second law of thermodynamics," he said.

  39. Right about that, unless it's some new and innovative torture techinique, or new unprofitable way to exploit women and children.

    Or blood libel propaganda copied from dRat.

  40. Madoff can get something from nothing.

  41. The prospect of a military defeat of the Liberation Tigers of Tamil Eelam is becoming more real as troops close in on them from eight directions. The navy is patrolling the coastline to prevent the Tiger leadership from escaping by sea and to stymie attempts to smuggle in weaponry.


    The current options for the LTTE are to fight to the last, which is very unlikely; surrender to the advancing army, which is unlikely; or to merge with civilians and look for safe passage to government-controlled areas after caching their arms. The last avenue seems very likely where ordinary cadres are concerned, but difficult for the Tiger leadership to pull off.


    There is much speculation now about what Velupillai Prabhakaran will do. Some say he has already escaped the army and fled the country.

    Military Defeat

  42. 2164th,

    Went to a barbeque last weekend. Stopped off at the grog shop and picked up a 6'er of Imperial. First time I've had it. Not bad. Nothing special. It's o.k. Goes down good ice cold on a hot day.

  43. Didn't say, Sam, but must be somewhere in the interior, away from the coasts. Maybe inland a ways from the coast of Northern Australia. These rites make the Catholic Mass look a little tame:)

  44. He goes on to quote Spencer and Gillen to the point that the abos, after someone in the clan died, would be required to 'disremember' the person, never mentioning them again, a result of being hunter/gatherers, not planters, and seeing death as always coming from the outside, not as naturally, at the end of a ripe old age, as the planters more normally do.

    "Among the Australian Aranda, according to the detailed account of Spencer and Gillen, the village where a death has occurred is burned to the ground, the person's name is never mentioned again, a number of painful and awkward ordeals are imposed on the widow and nearest relatives to ensure that the dead man shall regard himself as properly mourned, and finally, a dance and wild commontion of shouting, ground-beating, and mutual mayhem is enacted by the relatives on the grave itself, so that the deceased may know that he must not come back in such a way as to frighten people any more--though he may still watch over his friends if he likes, visit them gently in dreams, and guard them from evil. We may say that in a cultural atmosphere of this sort death is interpreted as terminal, as far as the relationship of the deceased to his society is concerned, and its mystery is in a sense denied and defied, feared yet challenged, never having been assimilated either psychologically of philosophically. Old age then leads to an attitude of resistance and to a pattern of thought and feeling that may be called that of the plucky old warrior, fighting to the end.

    For the planting folk of the fertile steppes and tropical jungles, on the other hand, death is a natural phase of life, comparable to the moment of the planting of the seed for rebirth."

    Mention of this not speaking of the dead ever again was made in the movie "Australia" somewhere, I noticed.


    Not sure I'm believing his 156, it's possible it's a misprint, for 136, or 126. I've never seen my author intentionally pull anyone's leg, however.

  45. Costa Rican beer is drinkable. The one I drink is Bavaria Gold.

    My fav beer is Pilsner Urquell from Plzen (Pilsen) Czech Republic.

  46. Who is to blame?

    The boomers.

    The economic guru Harry Dent says the boomers have reached the end of their spending, getting too old to do much other than play cards, and their resultant lack of spending is figuring large in all of this. No relief in sight, until the 'echo-boomers'--sons and daughters of boomers-- come on line, in their big spending years around their age 40 or so, around 2020.

  47. Here is a partial list of the current Voices of Doom--

    Harry Dent

    Gerald Celente

    Nouriel Roubini

    Peter Schiff---
    ("The government will create another Great Depression, but worse, because the cost of living will go through the roof.")

    Jeremy Grantham

  48. An absolutely amazing English beer was brewed in Ipswich, England called Tolly Cobbold. The beer was delivered to the local pubs in wood barrels and was hand drawn. It was startling good. Of course the money guys had to snatch up all the little breweries and like most other massive corporations, reduce the product to the lowest common denominator.

    Here is a little info about it from wikipedia:

    "Tolly Cobbold is a former brewing company, with strong roots in Suffolk, England.

    The original Cobbold brewery was founded in Harwich, Essex in 1723. The name Tolly Cobbold is an amalgamation of the two family run brewers the Tollemache Brewery owned by the Tollemache family and Cobbolds Brewery owned by the Cobbold family in 1957. In 2002, the brewery was acquired by Ridley's brewery.

    In 2005 Ridley's was bought by Greene King and dismantled, before, many claim, the recipes for the traditional Ridley's beers could be sufficiently recorded by their new owners.

  49. I watched something the other night somewhere--ah, heard it on the radio--about the last wooden cask maker in England. A cooper. A cooperer. Ah! Here It Is

    Guy's looking for an apprentice.

    Actually, beer making is doing ok around here, there are three or four micro breweries that I can think of.

  50. Utah Micros

    Polygamy Porter
    Patrons waiting for tables gazed at huge stainless steel fermenting tanks, and deeper inside the pub, others studied a hall of fame chronicling Wasatch’s clashes with politicians over names, labels and ad campaigns. The staff was delivering plates of fish and chips or buffalo burgers.

    The server at the table where a friend and I were sitting brought a flight of Wasatch creations, including Polygamy Porter, which has sultry, malted, espresso notes, and a smooth and slightly spicy Evolution Amber Ale.

  51. Just touch the 'blood flag', mat, that'll protect you from all types of libel.

    But not from Obama, Mitchell & Clinton

  52. "Compared with a car built during the 1970s, a 2009 model year car produces virtually none of the noxious combustion byproducts (chiefly unburned hydrocarbons) that combine to form smog and reduce air quality. In fact, less than 2 percent of what comes out of the tailpipe is other than water vapor and carbon dioxide -- neither of which have any effect of air quality.

    But California regulators -- and now Obama -- want to go after that remaining 1-2 percent. No matter how expensive. An economist would call this pursuing diminishing returns. But Obama is not an economist; he is a politician -- and he knows that people (most people) will like the sound of what he is proposing. "
    Moron Demagogues @ the controls.
    (Arnold and Obama)

  53. rufus said...
    Also, don't get too excited over "$800Billion Stimulus," and such. A lot of this money was going to get spent, anyway; plus that amount that really does get spent will get spent over, in some cases, ten, or twenty year.

    Lots a' Sturm n' Drang, and high-level "Politik'n" goin on, right now.

    So far, we're in kind of a garden-variety recession. Not nearly as bad as the ones in the early 80's.
    Rufus persists in maintaining his record of being 100% wrong.
    But, almost always optimistic.

  54. Think "Baseline Budgeting," gang.
    or, more simply, ask yourself how many times govt domestic spending has been CUT year over year, in your lifetime.

  55. This comment has been removed by the author.

  56. "And in what may prove to be the biggest stimulus-package hurdle of all, news reports suggest that Team Obama is contemplating as much as $2 trillion in TARP additions to rescue the banking system in one form or another. That would be $2 trillion on top of the nearly $1 trillion stimulus package.

    Government spending, deficits, and debt creation of this magnitude is simply unheard of. So the added TARP money will surely imperil the entire stimulus package as taxpayers around the country begin to digest the enormity of these proposed government actions. Financing of this type would not only destroy the U.S. fiscal position for years to come, it could destroy the dollar in the process. What’s more, the likelihood of massive tax increases — which at some point will become front and center in this gargantuan funding operation — would doom the economy for decades.

    By the way, Scott Rasmussen’s latest poll shows that already — before the new TARP money is included — public support for the humongous stimulus package has dropped to 42 percent.

    - Kudlow

  57. Fox: GOP Congressman Intros "Rangel Rule"

    The legislation calls for the creation of what he calls the, "Rangel Rule," -- drawing attention to the recent legal issues of House Ways and Means Committee Chairman Charlie Rangel, D-N.Y., enabling citizens who fail to pay taxes on time to do so later with no additional fees.

    Rangel, who writes the country's tax policies, acknowledged last fall that he failed to pay thousands in real estate taxes for rental income he earned from a property in the Dominican Republic.

    As of September 2008 the Harlem Democrat reportedly paid back more than $10,000 in taxes but that did not include any IRS penalties.

    "Your citizens back home should have the same rights and benefits that come to you as a member of congress. You shouldn't be treated any differently under the law than your citizens back home," Carter said.

    He added that citizens should receive the "same courtesy" that the IRS is allegedly granting Rangel and Treasury Secretary Tim Geithner, who also recently acknowledged a failure to pay taxes.

    Carter penned a letter to Rangel earlier this month requesting that he either pay the IRS fees or join him in co-sponsoring the legislation establishing the rule.

    "As Chairman of the House Ways and Means Committee, I believe you set an example for all American taxpayers in your dealings with the IRS, and that you must do so in a way that enforces blind justice without regard to wealth or status," he wrote in the January 6th missive.

    WT: Stimulus Has Pork for Dem's Son

  58. This comment has been removed by the author.

  59. This comment has been removed by the author.

  60. I would say, rufus, that with the increases in productivity that have been made, since the 1980's, that 7.5% unemployment, today, is a greater indicator of economic crisis than 10% unemployment was, then.
    A quick search found this tidbit for Canada, I'm sure that the US has had similar gains

    From 1980 to 2005, Canadian labour productivity increased by 37%.

    If unemployment reaches 9%, now, with the productivity gains factored in, that'd be proportional to 12.33% unemployment, then, by a measure of lost productivity.

    At 7.5%, we already are at a proportional loss of productivity that would equal an unemployment rate of 10.275%, in 1980

    This based again upon productivity of the labor force, now compared to 1980.

    One thing about mat and wi"o", hey'll wrap themselves in the flag of victimhood at any opportunity.

    A lot like Jesse jackson and Al Sharpton in that regard. Trotting out that tired horse whenever the itellectual arguments fail them.

    Just another version trying to define the acceptable parameters of the debate to exclude any real dissent by the demonization of the ideas.

  61. Dr: One thing about mat and wi"o", hey'll wrap themselves in the flag of victimhood at any opportunity.

    A lot like Jesse jackson and Al Sharpton in that regard. Trotting out that tired horse whenever the itellectual arguments fail them.

    Just another version trying to define the acceptable parameters of the debate to exclude any real dissent by the demonization of the ideas.

    Once again rat you just showed how full of crap you are...

    Your nonsense about "that 7.5% unemployment, today, is a greater indicator of economic crisis than 10% unemployment was, then." shows how you love to look at meaningless numbers to a conclusion any 3rd graders on crack could come up with....

    You do not understand macro economics, you do not allow for the changing work patterns that we infact promoted using nafta..

    You just take a number multiple by whatever factor sounds reasonable and POOF you have an answer...

    Your odd rant about mat and I "wrap themselves in the flag of victimhood at any opportunity." is as well quite out of the park..

    Might I suggest your in need of a MD visit to check your blood levels? Maybe some Prozac or Lithium?

    Suggesting that "A lot like Jesse jackson and Al Sharpton in that regard. Trotting out that tired horse whenever the itellectual arguments fail them.

    Just another version trying to define the acceptable parameters of the debate to exclude any real dissent by the demonization of the ideas."

    No rat, every discussion doesnt need to hold dear your blood libels, your distortion of the Jooos, the flat earth theory, the 911 troofers theory, the holiness of the UN & it's resolutions against Israel (and ignoring the bias that the UN has shown historically)

    Rat your bias against Israel and yes THE JEW is well documented..

    It's you that pulls out a flag of victimhood LIKE al sharpton and jesse jackson for every issue under the sun somehow it's israel's fault or it's a Jooo

    try arguing any issue under the sun and NOT mention israel or Joos...

    go ahead give it a try....

    (oh check under your bed 1st there may be joos hiding there)

  62. Blogger 2164th said...

    "Costa Rican beer is drinkable. The one I drink is Bavaria Gold.

    My fav beer is Pilsner Urquell from Plzen (Pilsen) Czech Republic."

    It's funny, as I was scrolling the comments I was getting ready to ask you about Costa Rican beer. It seems your tastes tend more toward the Pilsners though. Personally I'm more partial to Ales. I even like Stout with my fav being Guinness. Are there any Costa Rican ales you'd recommend?

    Re: Productivity growth countering slowing population growth. At least we agree that our society is addicted to growth but I'm not so sure productivity growth is sturdy enough to counter our dependence upon the easy growth associated with population growth. If you take a look at the majority of 'investment' schemes it appears to be heavily weighted to growth that is non productivity related. Social security being the elephant in the room that is totally set up to function based upon the young paying for the old. Insurance in general is dependent upon actuarial tables with the money stored in vehicles that are supposed to grow. Once that growth stops...uh oh.

    Rufus mentioned it all comes down to Housing as all past recessions. Well, I beg to differ. Most historical crashes have to do with over leverage and we've witnessed that in spades in this current, ummmm, downturn. The leverage extends from over-leveraged home owners right up the chain through the banks right to the top - governments. Debt piled upon debt all predicated on the premise that one can grow out of debt. That's the basis of debt- I borrow 100 bucks at a cost of 5 bucks a year and I make that 100 bucks earn 10 bucks netting a profit. If that doesn't happen...dang! Back to productivity - how does increased productivity help housing grow? You can be more productive building the suckers but you need MORE PEOPLE to live in those newly built homes.

    Anyway, I understand that growth is not entirely built upon population growth but it is a very very strong component of growth and we need to reassess our dependence upon growth to support our livelihoods. Hoping that the magic bullet of science and technology will pull us out of the downward spiral is misguided I think and the leveling off of population growth will be a strong drag on the markets going forward in the long term. The increasing velocity of boomer death will hurt the market overall but, of course, there will be bright spots. Picking them will be a challenge though. Hey, we can (and are already doing) print money to create the illusion of growth.

  63. Global trade wars or voter revolt? Let Obama's difficult decisions begin


    From Friday's Globe and Mail

    January 30, 2009 at 4:23 AM EST

    WASHINGTON — The toxic "buy American" provisions in the economic stimulus package currently before the Senate pose a crucial test for Barack Obama's young administration.

    To prevent a cascade of tariff protection that would ultimately hurt his own workers and his own country's economy, Mr. Obama must find some way to strip the protectionist clauses that infect the American Recovery and Reinvestment Act.

    Yet, politically, that might be impossible. Mr. Obama owes his presidency to the votes of blue-collar workers in the industrial Midwest, many of whom are out of work as a result of the slowdown.

    "Buy American" violates the North American free-trade agreement, but Mr. Obama has vowed to renegotiate or, failing that, rip up NAFTA, so has little stake in coming to its defence.

    And he would be overriding protectionist provisions put in the bill by his own Democratic Party.

    The President has said the time has come to make "difficult decisions." This is one of them.

    Even economists who strongly support the stimulus package are dismayed by the protectionist measures contained within it.

    "It looks like a very bad thing in the bill," said economist Brad DeLong, who worked on trade issues in the Clinton administration and teaches at University of California, Berkeley.

    "Pressure from the Canadian government saying, 'Do you really want to do this?' is important."

    Canadian officials have, in fact, been working behind the scenes to keep protectionist measures out of the economic stimulus package.

    But they failed to stop the House version of the bill from including a provision banning the use of anything other than American-made iron and steel in projects funded by the stimulus package.

    The Senate version of the bill would require that everything it funds use only American products.

    The White House could try to convince the Democratic leadership to strip the anti-trade measures from the bill, both before it is voted on by the Senate and during the conference to reconcile the House and Senate versions of the bill.

    If that fails, then Mr. Obama could issue what is called a signing statement saying the "buy American" provisions of the bill violate treaty obligations. That might effectively veto the measures, though Daniel Ikenson, associate director of the Center for Trade Policy Studies at the Cato Institute, believes the measures would go ahead regardless.

    Mr. Ikenson, who calls the "buy American" provisions "stunningly ridiculous" and bound to incite trade wars, believes Mr. Obama must either convince Congress to drop the provisions or acquiesce.

    "He has to strip it or sign it," he said yesterday in an interview.

    Canada could ask for an exemption from the provisions, based on the integrated nature of the continental economy. George W. Bush exempted Canada from steel tariffs imposed in 2001. But the trend since the Sept. 11, 2001, attacks has been in the opposite direction, and there are early indications the Obama administration might accelerate that trend.

    Days after she was sworn in, Homeland Security Secretary Janet Napolitano ordered an urgent review of the Canada-U.S. border.

    "Members of Congress and homeland-security experts have called for increased attention to the Canadian border," the directive reads.

    "What are the current vulnerabilities, the overall strategy for reducing those vulnerabilities, the requirements, the programs, the budget, and the time frame for improving security along this border and what level of risk will remain once the programs are completed?"

    Various agencies, including Homeland Security, Customs and Border Protection and the Coast Guard have until Feb. 10 to prepare an oral report, with the final report due Feb. 17. Any recommendations, once implemented, could further impede the free flow of goods and people across what used to be the world's longest undefended border.

    Suddenly, Mr. Obama's Feb. 19 visit to Canada has turned into a meeting to address the growing list of protectionist measures directed toward Canada by his administration.

    Throughout the 19th century, the United States pursued a policy of erecting high tariff walls, while pressing trading partners - especially the weaker, more dependent ones - to open their markets to American goods.

    After the Second World War, the United States led the push for ever freer trade in goods and services, though protectionist backlashes - usually emanating from Congress - were a constant irritant.

    The 111th Congress is showing every sign of being more than an irritant. How he handles the "buy American" provisions of the stimulus will tell a lot about Mr. Obama's determination, or lack of it, to resist congressional efforts to close the American border.

  64. Rufus persists in maintaining his record of being 100% wrong.
    But, almost always optimistic.

    Well, at least I'm not bickering, interminnably, about the Joos and the Palis. :)

    I don't know, the economy grew at a 1.3% rate in 2008, and, I predict, will more or less flatline this year. Maybe down a touch, maybe up a touch.

    Unemployment, the last I looked was 6.7%, not great, but not nearly as bad as the eighties.

  65. Actually, tariffs and protectionism are a good thing, Ashley. Companies that sell abroad should be required to pay double rate on that taxable income. There's absolutely no reason for American taxpayers to be subsidizing international corporations that sell goods and services to foreigners.

  66. Mat, 1/3 of all the jobs in the U.S. are in some way connected to "Exports."

    Smoot-Hawley Caused the Great Depression.

  67. hahaha, funny guy mattie. I'm sure you can regale us with the logic behind your assertions. Double taxation of income earned from sales abroad - hehehe

  68. Mat, 1/3 of all the jobs in the U.S. are in some way connected to "Exports."

    That's irrelevant.

    The great beneficiaries "free trade" are the Multinationals who have turned the local labor markets into slave markets and the environment into a poisonous sewer and dumping ground.

  69. hahaha, funny guy mattie.

    Thank you, Ashley. You've just confirmed that I'm 100% correct.

  70. The great beneficiaries ^of "free trade" are the Multinational..

  71. Go take a nap, and sober up, Mat. You're becoming unhinged.

  72. No, Rufus, I think I have a VERY sober grasp of what's going on. The remedies might seem radical and unhinged to you, but that's because you don't know any different.

  73. Mattie, you are starting to reveal the logic behind your assertions and it appears to be quite childish- multi-national corporation = bad therefore all bad things must be because of multi-national.

    You are a big fan of Israel are you not? How do you think Israel would fare with a completely closed command economy that you envision? Currently half of their GDP is dependent upon the import/export market. I know what your answer will be without you needing to state it - "They'll do great! Full stop." Pronounce away but the only one you seem to be convincing is yourself.

  74. Mat, 1/3 of all the jobs in the U.S. are in some way connected to "Exports."

    There's more to life than Jobs. There's quality of life. And people living like beast of burden in the service of Multinationals while holding 2 or 3 jobs aint gonna cut it.

  75. You are a big fan of Israel are you not? How do you think Israel would fare with a completely closed command economy that you envision?

    That's not what I envision and what I propose. What I propose is localism and accountability thru the diminution of Multinationals. The multinationals are unaccountable and have subverted the role of government. My intent is have this reversed.

  76. like beasts of burden..

  77. Mat, I do know this: We have the most free trade policies in the world; and we have the highest per capita income of any major, or semi-major nation in the world.

  78. All we got to do to control population growth is control immigration, cause that's where it's all coming from, according to all I've read.

    So the dems give us birth control money, and we don't need it, and lax on immigration, which we don't need.

  79. Mat, I do know this: We have the most free trade policies in the world; and we have the highest per capita income of any major, or semi-major nation in the world.

    And yet your cities and towns are the ugliest and most alienating in the world. How do you explain that?

  80. So we're gonna spend money on everything we can think of, revive Smoot-Hawley, raise taxes, inflate the currency, legalize the illegals, not drill, not build nukes and cave to Iran,and go crazy on global warming, er climate change. And tax cigarettes. Happy Days are here again.

  81. And yet your cities and towns are the ugliest and most alienating in the world. How do you explain that?


    They're much like those in Canada, s few sprawls to the contrary. Better than those in Central and South America, better than those in most of Europe(to my mind anyway) better than most of China, way ahead of India and most all of the moslem world, and better than Africa.

    Our country was industrialized early, some of the infrastructure is old. Obama's gonna fix that.

  82. mat wrote:

    "And yet your cities and towns are the ugliest and most alienating in the world. How do you explain that?"

    Urban planning is not practiced very well in many US cities.

  83. Popular Science slipped Pittsburg into its List of the world's ten worst cities. There must be some political motive here, as I can think of a lot of places worse than Pittsburg, around the world.

  84. Ugly and alienating?

    Because that's the way we like it.

    As I said before, you don't get around much.

  85. Ugly, and Alienating?


    You act like no one on this blog has ever been anywhere.

    If you mean modern, clean, air-conditioned, and loaded with every consumer item you could possibly ever want, at a price you can afford to pay, then I guess you're right.

  86. Everybody tries, though, Ash. So far, I'm the only one hasn't had any real input into the planning of my own, and last, upcoming development. We've got traffic circles, parks and green strips the park department doesn't have the money to take care of and the people don't use, we've got sprawl because of recent unrealistic and absurd traffic count requitements, and no neighborhood business district. Each set of neighbors has a different demand, depending on their particular outlook and needs. Some want me to go away, others want me to build access streets to them, so I make them rich, as they can develope their land too. We're gonna have five different zones in the area when I asked for one. And nobody knows what the demand is.

    I'm thinking of saying the hell with it, and making it a gated community with one acre lots, and letting it go at that.

  87. Ah, Lagos, Nigeria, my kind of town.

  88. Horseshit!

    That's exactly what 90% of the US looks like. Mass produced shit that's been shited out thru a brainless gigantic asshole.

  89. Yeah Bobal, from what I can see there is a wide variety of planning going on ranging from next to nothing to very detailed oversight. In most cases though the planning seems to emanate from local politics as opposed to conforming to a strong theoretical base. Ironically the very local haphazard nature of much US planning seems conforms to Mats ideological desire for it to be "local".

  90. One city council wanted the high density apartments concentrated near the University. This makes sense.

    Then the next city council came in and granted some high density zoning way out by the cemetary, which didn't make any sense.

    Now, we've got a new group. reputed to be pro-business, but, the requirement(theft of parkland) for parkland is the highest it's ever been, and the money in lieu of clause has been dropped, so of course the planners want to say where it has to go, all the while the park guy is still saying he's got too much park land. And it's true too, we have acres of parkland sitting around going to weeds. And the functioning parks are really very little used, not at all in the winter.

    What the town needs is a good clean brothel!

  91. My wife has pointed out that a lot of people don't want to live near parkland, many older folks don't. Parks are used mostly by folks with kids, just for a few years, and, in bigger cities, for doing drugs, drinking and whatnot, so I've heard.

  92. Mat's World:

    \ No income taxes
    \ No property taxes
    \ 1% sales tax and 10% flat tax on businesses to finance government
    \ Fixed 50% levy on all foreign goods and services
    \ No subsidies or gifts of any kind to or from businesses
    \ True multi party democracy
    \ No federal government services other than regulatory laws and national army
    \ No borrowing of money to pay government expenditures, including wars
    \ No military bases abroad
    \ No foreign aid
    \ No UN
    \ No NATO
    \ No foreign treaties and No international memberships and No long tern obligations of any kind
    \ White color crime and corruption to be punished by confiscation of all family property down to the grandkid's and a minimum 30 years imprisonment with hard labor for those directly involved

  93. Fixed 50% levy on all foreign goods and services

    This includes new immigrants.

    A minimum of 20 years mandatory waiting period to become a citizen. Persons found to be employing illegal aliens to lose their citizenship and all family property.

  94. I see from a quick reading of your fantasy world that you've already dumped your idea of double taxation on income earned from abroad.

  95. and draconian punishments just like the Taliban...

  96. I see from a quick reading of your fantasy world that you've already dumped your idea of double taxation on income earned from abroad.

    I figured it was too difficult enforce. The other provisions pretty much cover the same ground.

  97. and draconian punishments just like the Taliban...

    You can call me Mat the Dragon.

  98. MS-13 And Related Groups Prove Immune To The Recession

    Secret of their success? Guile, violence, brazeness, all the old tried and true tactics of the past.

    Coupled with a permissive society.

    Solution: Turn Mat, and a thousand good men and true of his choosing, loose on these groups.

    Problem solved.

  99. Did you know that a wombat drops a distinctive cubic turd?

    I thought not.

    They are not commonly seen, but leave ample evidence of their passage, treating fences as minor inconveniences to be gone through or under, and leaving distinctive cubic faeces.

    Wombat From Wiki

    Perhaps these could be permanently harded, and used as dice, when shooting craps in Vegas?

  100. Solution: Turn Mat, and a thousand good men and true of his choosing, loose on these groups.

    First thing Mat would do is send Ashley to solve the problem. And if she comes back and the problem still persists, it's up against the wall and a bullet to the head for Ashley.

  101. Well, Ash wouldn't be a potential crime victim any longer, so you'd have protected him.

    Off to a good start.

  102. "Some very very smart people are very very worried, and they should be..."

    Speaking of "smart people". An interesting quote from the book "Empire of Debt" by William Bonner and Addison Wigginin:

    "When we were young, we were a lot smarter. But as the years go by, many of the things we thought were smart don’t seem so smart anymore. And now we realize that no matter how smart we think we are, we are never quite smart enough. We think stocks are going up, we think we can build a better world in Mesopotamia, we think we can tell the fellow down the street how to discipline his children or decorate his house. But what do we know? It is easier to be smart than to be good; that’s why there are so many smart people, and so few good ones. Smart men get elected to high office. They run major corporations. They write editorials for the newspaper. Pity the poor good man; he goes to parties and has nothing to say that is not mocking and cynical. Others talk about their smart deals, their smart ideas, their smart plans and successes. Women crowd around them; a smart man grows taller as he speaks. The good man shrinks. We bring it up here just to argue with it. Because we think it is virtue, not brainpower, that really pays off."

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