So while we all hoot at the convention in Tampa...

[Anonymous]

maybe we can pause a beat to get serious?

Jack Mintz is a respected Canadian economist. Here's a link and some excerpts
http://opinion.financialpost.com/2012/08/21/u-s-worse-than-europe/


...the U.S. is in far more trouble than Europe.

This was brought home by calculations presented by Larry Kotlikoff of Boston University at a lecture held at the International Institute of Public Finance, the biggest gathering of public-finance experts in the world. Greece may be bankrupt, but the U.S. looks like a giant Ponzi scheme.

Kotlikoff’s calculations show that U.S. unfunded liabilities total US$222-trillion, the highest of all major OECD countries (12% of the time value of U.S. GDP) once accounting for monetary public debt, Social Security deficits and public-health-care unfunded liabilities

The U.S. reflects the most extreme case of intergenerational inequality. Generation after generation has participated in a Ponzi game, leaving younger taxpayers to pick up the tab for money effectively borrowed by older generations to spend on unfunded benefits. Kotlikoff labelled such practices as “child fiscal abuse,” a rather strong term but not far from the truth.

The United States should be ashamed. While many experts criticize the Europeans for not pulling together politically, U.S. indebtedness is far greater and more dangerous to the world economy.

Very simply, current policies are totally screwing our kids. The data is there. Although it's really fun to blame one party or the other, or to get nasty about earrings or speeches or birth certificates or tax returns, I share the author's puzzlement over our inability to grapple with this intelligently. I don't blame the pols..they do what we ask. Clearly we're asking them to duck and they continue to do so and win elections.

The first poster to say "oh yeah? well (fill in your party) is trying but the other guys won't" gets sent home until he/she can learn to play nice.

[Anonymous]

Oh yes. I recently heard thoughtful, reasoned presentations by the chief economist for The Economist magazine and the Dutch ambassador that supported this view.

[Anonymous]

OP here. I can use dcum as a good indicator whether I should add to our family's gold investments. That we've had more posts about Ann Romney, Mia Love, and msnbc is indicative that one can't confuse smarts with judgement.

It's funny that a forum dedicated to kids can't be bothered to pay attention to this. Spain has 20%+ youth unemployment and is now embracing a barter economy.

Maybe it's a mass psychological shutdown; easier to snark about earrings than to deal with reality.

[jsteele]

I don't believe that you presented your first post effectively. It is difficult to understand what point you are trying to make. Overuse of the term "ponzi scheme" does not help enlighten us. The only fact that I really can glean is the problem of unfounded liabilities.

I think you might get more interest in your post if you organized it better. What is the problem? What facts demonstrate this is a problem? What are the ramifications of the problem? Finally, just leave out the last sentence.

[Anonymous]

Anonymous wrote:OP here. I can use dcum as a good indicator whether I should add to our family's gold investments. That we've had more posts about Ann Romney, Mia Love, and msnbc is indicative that one can't confuse smarts with judgement.

It's funny that a forum dedicated to kids can't be bothered to pay attention to this. Spain has 20%+ youth unemployment and is now embracing a barter economy.

Maybe it's a mass psychological shutdown; easier to snark about earrings than to deal with reality.

You seem like you are just itching for a fight. The discussion of the GOP convention is still relevant, even if we do not revisit the dent issue on a daily basis. Americans are allowed to care about more than one thing at a time. Race and gender politics matter too.

Someone else might tell you that your concern is irrelevant because our planet will be uninhabitable in a few more centuries, but they would be off base in suggesting the debt is not a valid concern.

If you want to discuss the debt, try again and don't lead with the suggestion that we are idiots for talking about anything else.

[Anonymous]

OP I am no economist. But it seems to me that during a recession is not when you cut spending to "balance the budget". What we SHOULD be doing is increasing taxes on the richest Americans, ending these ill-begotten, endless wars, and paying our unemployed citizens to improve our crumbling infrastructure. Once we start to get back on our feet, I'll be first in line for cutting the debt and spending wisely. But first we have to dig ourselves out of this hole. I know you want to blame "current policies" for, let's say, bailing out the banks or saving GM or saving the housing industry. Hey I hate corporate welfare too. But once we get our industries back on their feet, heck maybe even profitable again (oh wait, did the administration already accomplish that?) THEN we can discuss austerity. This is not the time to enforce austerity on the lowest classes of society who are already living pretty darn austerely.

PS If we get rid of the tax deductions for dancing horses, I think we could easily fund these pointless, endless wars indefiniately. How about we go after Iran while we're at it? In for a dime, in for a dollar! Plus war is good for (certain) American industries. Just ask Dick Cheney.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP here. I can use dcum as a good indicator whether I should add to our family's gold investments. That we've had more posts about Ann Romney, Mia Love, and msnbc is indicative that one can't confuse smarts with judgement.

It's funny that a forum dedicated to kids can't be bothered to pay attention to this. Spain has 20%+ youth unemployment and is now embracing a barter economy.

Maybe it's a mass psychological shutdown; easier to snark about earrings than to deal with reality.

You seem like you are just itching for a fight. The discussion of the GOP convention is still relevant, even if we do not revisit the dent issue on a daily basis. Americans are allowed to care about more than one thing at a time. Race and gender politics matter too.

Someone else might tell you that your concern is irrelevant because our planet will be uninhabitable in a few more centuries, but they would be off base in suggesting the debt is not a valid concern.

If you want to discuss the debt, try again and don't lead with the suggestion that we are idiots for talking about anything else.

Over 50 posts each in threads about earrings and a governor's weight. I don't need to call anyone an idiot--it's being done for me.

Drilling down to a core question--why isn't anyone else around here terrified for the financial well-being of the next 2 generations? I'm not going to carry this myself and I think it's a delightful fantasy to think the lack of interest is around framing or prose; too many of the threads around here are the equivalent of supermarket tabloids.

[Anonymous]

Anonymous wrote:OP I am no economist. But it seems to me that during a recession is not when you cut spending to "balance the budget". What we SHOULD be doing is increasing taxes on the richest Americans, ending these ill-begotten, endless wars, and paying our unemployed citizens to improve our crumbling infrastructure. Once we start to get back on our feet, I'll be first in line for cutting the debt and spending wisely. But first we have to dig ourselves out of this hole. I know you want to blame "current policies" for, let's say, bailing out the banks or saving GM or saving the housing industry. Hey I hate corporate welfare too. But once we get our industries back on their feet, heck maybe even profitable again (oh wait, did the administration already accomplish that?) THEN we can discuss austerity. This is not the time to enforce austerity on the lowest classes of society who are already living pretty darn austerely.

PS If we get rid of the tax deductions for dancing horses, I think we could easily fund these pointless, endless wars indefiniately. How about we go after Iran while we're at it? In for a dime, in for a dollar! Plus war is good for (certain) American industries. Just ask Dick Cheney.

1. we're not in a recession now. it's a period of sub-par growth
2. raising taxes on the rich and cutting defense spending helps around the edges, only.
3. infrastructure spend is great, but these are the days of WPA. it's highly skilled labor throughout the chain and fewer jobs than you think. it's a part of the puzzle.
4. the banks are, broadly, in decent shape now (unlike those in europe.) it takes time for reality to catch up to perceptions. corporate profits are quite high, although ebbing now.
5. re: not the time for austerity..it's debatable. we can't know for sure the right time for austerity. a greek i'm sure said the same thing 10 years ago..if he had a do-over would he still argue for deferring?

[Anonymous]

jsteele wrote:I don't believe that you presented your first post effectively. It is difficult to understand what point you are trying to make. Overuse of the term "ponzi scheme" does not help enlighten us. The only fact that I really can glean is the problem of unfounded liabilities.

I think you might get more interest in your post if you organized it better. What is the problem? What facts demonstrate this is a problem? What are the ramifications of the problem? Finally, just leave out the last sentence.

sorry, don't think I need a lesson in expository writing. economics is, indeed, the dismal science. a post alleging Mitt has relations with barnyard animals would pull much better.

[Anonymous]

Anonymous wrote:

jsteele wrote:I don't believe that you presented your first post effectively. It is difficult to understand what point you are trying to make. Overuse of the term "ponzi scheme" does not help enlighten us. The only fact that I really can glean is the problem of unfounded liabilities.

I think you might get more interest in your post if you organized it better. What is the problem? What facts demonstrate this is a problem? What are the ramifications of the problem? Finally, just leave out the last sentence.

sorry, don't think I need a lesson in expository writing. economics is, indeed, the dismal science. a post alleging Mitt has relations with barnyard animals would pull much better.

You just want your topic to fail. A post which Pre-emptively disparages the expected response is truly self-defeating.

So I'll give you what you were hoping for all along: you are a douchebag. There, did that validate your opinion?

And in the slim chance that you actually want an answer, I actually like Erskine Bowles. In the absence of at I am happy to let the automatic triggers of the current budget deal bring both sides howling to the table. In order to do that I need to vote for Obama.

[Anonymous]

OP, I would like to ask you: Why do you think the current administration is committed to "failing" policies? I mean Obama's got people, just like any other President, right? People who are financial wizards, economist this, chief of policy that. So why shouldn't we listen to them when they say "we are on the right track. It's going to take time - and tax increases on the rich - but we will get there".

And I'd LOVE to give the economic proposals of the Republicans a serious listen. Unfortunately I can't do that until they let go of their obsession with women, fetuses, and gays.

[Anonymous]

Anonymous wrote:OP, I would like to ask you: Why do you think the current administration is committed to "failing" policies? I mean Obama's got people, just like any other President, right? People who are financial wizards, economist this, chief of policy that. So why shouldn't we listen to them when they say "we are on the right track. It's going to take time - and tax increases on the rich - but we will get there".

And I'd LOVE to give the economic proposals of the Republicans a serious listen. Unfortunately I can't do that until they let go of their obsession with women, fetuses, and gays.

+1. I for one don't vote on economic or social issues only, but I'm sure not going to vote for a oarty that wraps themselves in Christ while promoting bigotry and contempt for the poor.

[Anonymous]

Anonymous wrote:OP, I would like to ask you: Why do you think the current administration is committed to "failing" policies? I mean Obama's got people, just like any other President, right? People who are financial wizards, economist this, chief of policy that. So why shouldn't we listen to them when they say "we are on the right track. It's going to take time - and tax increases on the rich - but we will get there".

And I'd LOVE to give the economic proposals of the Republicans a serious listen. Unfortunately I can't do that until they let go of their obsession with women, fetuses, and gays.

OP here, and first off I wholly agree with the choice views and think it's one of the few issues out there as, if not more, important that the fiscal crisis.

Neither party is being honest about the fiscal problems--they are just too daunting and maybe don't fit in our political system. I keep saying this: taxing the rich won't work. (1) there aren't enough of them and (2) there's a law of diminishing returns and wealth will move around to avoid taxation. That's not an opinion.

The lies here are to look at debt on a Federal basis only, w/o including debt for states and localities. By debt I also mean promises made for pension and health care. The article cited estimated total debt/liabilites of some $200 trillion or 12% of GDP. That is a staggering number, particularly for a country with somewhat unfavorable demographics. We've had little leadership here..if social security is the "3rd rail" then think how hard to frame these more dour realities.

I don't have the answers. One not-too-stupid way out is to play the Argentina card and inflate. Most of us with an Austrian economic bias believe that's our future.

Here's one interesting (to me) parallel: btw environmentalists and fiscal conservatives.

A thoughtful view on climate change might suggest that while we don't know for certain what the cause may be or what the future will look like w/o action, there are enough smart and scared scientists to suggest it makes sense to maybe sacrifice some global GDP over the next decade or two for prevention. It's basic risk management--what if they're right?

Same with the financial challenges. There are plenty of smart economists out there not affiliated with a politician who are terrified over the U.S. fiscal situation. What if they're right? So while we dither about taxing the rich and oil companies and ceo pay and other (in my view) side issues, left unattended the outcome could be seismic. Do not overestimate govt's ability to solve the problem..there's too much history otherwise.

[jsteele]

Anonymous wrote:
I don't have the answers. One not-too-stupid way out is to play the Argentina card and inflate. Most of us with an Austrian economic bias believe that's our future.

I could get on board with a helicopter drop if they would drop it someplace besides the banks. I don't quite understand your opposition to returning the upper tax brackets to the pre-Bush levels. Nobody expects that to single-handedly solve the problem, but it is a piece of the puzzle. But, politically, we have constrained ourselves. We don't want to increase the deficit, we don't want to cut, and we don't want inflation. There's not much left after that. I think a Keynesian approach could work, but the so-called deficit hawks and those who have nightmares about inflation make it impossible.

[Anonymous]

jsteele wrote:

Anonymous wrote:
I don't have the answers. One not-too-stupid way out is to play the Argentina card and inflate. Most of us with an Austrian economic bias believe that's our future.

I could get on board with a helicopter drop if they would drop it someplace besides the banks. I don't quite understand your opposition to returning the upper tax brackets to the pre-Bush levels. Nobody expects that to single-handedly solve the problem, but it is a piece of the puzzle. But, politically, we have constrained ourselves. We don't want to increase the deficit, we don't want to cut, and we don't want inflation. There's not much left after that. I think a Keynesian approach could work, but the so-called deficit hawks and those who have nightmares about inflation make it impossible.

I don't have a problem with restoration of those marginal rates but add in higher cap gains, higher dividend tax rates, extra payroll tax, and I worry when you push overall marginal rates toward 50%. Add in state/local and it's an impressive tax rate. I don't appreciate the false tenor of the "millionaire/billionaire" chatter--it's done by those who know better. (1) income and wealth are two wholly different things and they know that (I called Pearlstein on that a few mos ago and he agreed--he's usually better than that) (2) are we really claiming an income of $300k on a coast with a family makes you rich?

Just don't think the class warfare moves us anywhere helpful, and you see the applause lines parroted here on dcum w/o much appreciation for the bigger picture. Finally, it's a helluva lot of fighting for little benefit. CBO's revenue estimate for the higher rates = almost 1 month of Federal deficit spending. If you're gonna p%ss off so many people at least get some real returns.

Illinois downgraded today. Horrible budget deficits and inept (dem) legislature. Higher taxes not helping and in fact companies are moving to close-by states (capital flight--just like in Europe.) IL is our Greece and eventually Fed money will be needed to bail them out.