A Strong Brown Light Shines on our Economy. And, We Spend More?

Abstract: Many economic sectors of the world are crashing in a debt-driven downward deflationary spiral and not enough alarms are being sounded. The consequences of debt are obvious in Spain, Ireland, California, New Jersey and other places yet the US seems to want to keep on spending. Economic disaster looms.  They left keeps on spending and borrowing with no end in sight and must realize what they are doing to our economy. That means the far left must have some plan to deal with social unrest and worse if the economy crashes in a blizzard of inflated money. Our dollar may become worthless and we might even get a second Bank Holiday-FDR style—where they close the banks and give us  back a dime to the dollar—a neat 90% wealth tax.

Many times I have attempted to alert the readers of my blog that bad times are ahead due to excessive debt. [1][2][3] We are in massive debt and subject to crushing punishments in order to pay that mountain off. [from a previous blog]: Our government has now chosen to fight this deflationary spiral with massive spending and hence massive debt. This is called monetizing the debt[4] and it has never been successful in curing any financial problems.  The process always leads to inflation or hyper inflation if the inflation rate exceeds 50% per month.  If the poor depend upon social program and housing assistance and welfare paid by others then we can suggest that those who provide the jobs be given preference when constructing measures to fight deflation. The government does not share this vision.

Apparently, since the tax structure was warped enough to allow the ‘poor’ to escape most taxes they seem to feel no risk if we ‘soak the rich’ and get on the reparations bandwagon. [5] Since the ‘rich’ provide almost all the jobs and all the funding in the US this notion flies into the steamy jaws of insanity but makes for a good political argument. California has spent more than a decade ‘fighting spending’ and loving every dollar they spend while celebrating all those expenditures. The salaries are high, the bennies wonderful in the extreme and they have such a neat society. [6] If only they could hike taxes on property and more on income and corporate taxes they could have Splendor[7] with Grass.[8]

Ireland has been in trouble with massive spending for a while and has been the subject of impending disaster by Ambrose Evans-Prichard of the London Telegraph.

 Four days ago, he wrote this:

“Events have already forced Premier Brian Cowen to carry out the harshest assault yet seen on the public services of a modern Western state. He has passed two emergency budgets to stop the deficit soaring to 15pc of GDP. They have not been enough. The expert An Bord Snip report said last week that Dublin must cut deeper, or risk a disastrous debt compound trap.

A further 17,000 state jobs must go (equal to 1.25m in the US), though unemployment is already 12pc and heading for 16pc next year.”[9]-- Fiscal ruin of the Western world beckons. For a glimpse of what awaits Britain, Europe, and America as budget deficits spiral to war-time levels, look at what is happening to the Irish welfare state. By Ambrose Evans-Pritchard
Published: 5:40PM BST 18 Jul 2009 [Emphasis is mine in all quotes.]

Anybody paying attention to California and can see some parallels?[10][11]

“No doubt Ireland has been the victim of a savagely tight monetary policy - given its specific needs. But the deeper truth is that Britain, Spain, France, Germany, Italy, the US, and Japan are in varying states of fiscal ruin, and those tipping into demographic decline (unlike young Ireland) have an underlying cancer that is even more deadly. The West cannot support its gold-plated state structures from an aging workforce and depleted tax base.”-- By Ambrose Evans-Pritchard 18 Jul 2009

Really? Well, they are going to try. California has no intention of cutting the astronomical salaries of teachers and state employees. They are going to tax anything they can and then crawl to Washington for a bailout.

Evans-Prichard sums up like this:

“The Fed's doctrine – New Keynesian Synthesis – has let it down time and again in this long saga, and there is scant evidence that Fed officials recognise the fact. As for the European Central Bank, it has let private loan growth contract this summer.

The imperative for the debt-bloated West is to cut spending systematically for year after year, off-setting the deflationary effect with monetary stimulus. This is the only mix that can save us.

My awful fear is that we will do exactly the opposite, incubating yet another crisis this autumn, to which we will respond with yet further spending. This is the road to ruin.”

And, that is just what is happening. There is no way the left can either cut spending or allow tax breaks for corporations that provide necessary jobs. They think they can tax and spend their way to power, a reasonable assumption given the recent political outcome, and then restore the economy with huge government spending and more and bigger government.

From an edited  previous blog: “Only half of the 130 million workers in the US pay taxes so a trillion dollars winds up to be $16,000 in tax liability for each worker who pays taxes. [12] Note that 20 trillion in debt becomes $320,000 in tax liability per worker who makes over $50,000. That means that the total equity [and more] of the homes of the average worker is in jeopardy.  The only people who can pay high taxes are those with wealth and property and they will be asked, or forced, to pay for most the new spending, debt service and new social programs. This debt is so large that it impacts the 401(k)s now so popular since Social Security is a grim  joke. The temptation by government is to seize the 401(k)s and blend this money into some federal retirement system patterned along the same lines as the USSR plan. All that wealth vanished in inflation by 1990.”[13]

So, if we assume that this information is common knowledge and above the crass cognitive skill base of the low class, then we wonder what the intent might be. We must assume that the leftist ‘intellectuals’ believe in at least some form of economic sanity and must accept that this massive debt and spending are not sustainable. Or do they? What if the system crashes and they can blame capitalism? Did the Bolsheviks lose anything when they grabbed the loot of the Czar and spent it all away on wars??

We better give some more thought to the motives of those who pull the purse strings in American and that begins with Nancy Pelosi and Harry Reid. Do either one of these political stuffed vegetables understand that if we keep printing money we will crash in a blizzard of worthless money? Unfortunately, we have losers and sophist ding dongs like Little Timmy Geithner [14][15] who promises us he can unwind this mess.

"We have the deepest and most liquid markets for risk-free assets in the world. We're committed to bring our fiscal deficits down over time to a sustainable level.

"We believe in a strong dollar ... and we're going to make sure that we repair and reform the financial system so that we sustain confidence," he said.”[16]-- Geithner tells China its dollar assets are safe On Monday June 1, 2009

This is not possible if we soar beyond the Gladwell’s Tipping Point, where we are certainly headed:

“Today we call this [e.g. the point where you cannot return ed]  "Gladwell's tipping point". Once it goes, you can't get back up. This is why the Federal Reserve has resorted to emergency measures that seem mad at first sight.”[17]--Federal Reserve is damned either way as it battles debt and deflation By Ambrose Evans-Pritchard 18 Dec 2008 [Emphasis is mine in all quotes.]

I am not sure whether the liberals are already geared up for this collapse and could use the destruction of our currency to nationalize everything in sight. We would still have tangible assets but no way to buy or sell them and would be subject to government regulations for food and energy, now being taxed as astronomical levels.

Obama favors huge energy taxes[18], an undisputed fact, and a tax that does not appear in the political discussions. If new energy taxes are passed along to consumers by corporations then the customers will pay the higher price. That is an indirect tax. In theory, corporations pay no taxes at all because all taxes are included in the costs of production hence they are included in the price paid by the end user. The notion that the ‘poor’ will not have to pay for the higher intrinsic taxes embedded in commodities like tooth paste and sodas is ludicrous. But, such nostrums are the very essence of political persuasion. The crevasse that separates the leftists from the capitalists forces the advocates of the have-nots to be devious and dishonest. They cannot tell the truth about taxes. They have few options other than begging or threats. The black black box [theory on inputs, mechanisms and outputs] must generate outputs in concert with this disinformation mandate and it does exactly that.[19]

So, we are showered with lies from idiots:

The Tax Essay:

Obama statements about taxes in a debate with Hillary:[20]” I not only have pledged not to raise their taxes, I've been the first candidate in this race to specifically say I would cut their taxes. [Emphasis is mine in all quotes.]

President-elect Obama famously claims, “I’ll give a tax break to 95% of workers and their families.” [21] 

Writing in The Wall Street Journal on Nov. 3, 2008  Obama said, “If you work, pay taxes, and make less than $200,000, you’ll get a tax cut.”[22]

This essay [from Nov. 2008] surges on and on while the actuaries and accountants show that people making about $80,000 will certainly experience an income tax increase. 95% of the workers yield for us the implausible number of about 125,000 people who would get a tax cut not counting illegal aliens and criminals who ‘work.’

Joe Biden [Plugs the Buffoon] has clarified this for us:

“"Read my lips," Biden said, using Bush's famous phrase while referring to a Barack Obama administration.”Nobody, nobody making less than $250,000 is going to see a penny of their taxes go up."[23]—Biden[24] in an incoherent rant at some county fairgrounds near the campus of Ohio University in Athens on Oct 15, 2008.

There is not a single word of truth in the Obama platform since the summer of 2008, a year ago. Now, we face massive taxes on energy and health care and everything we can think of.  The fed has printed some. Obama believes in the green revolution and tax whoring behemoths like Global Warming[25] and Carbon Caps[26] that will our destroy society like they are  doing now in England.[27]

Get ready to lose all your assets including your homes and your savings money in a massive inflationary blast. The liberals are hungrily waiting to grab all that you have and ‘redistribute’ it to the ‘poor.’

My awful fear is that they are planning another Bank Holiday so they can close doors, freeze accounts and then pay out ten cents on the dollar. That would be a 90% wealth tax and very fitting and proper under leftist theories.

rycK

Comments to: ryckki@gmail.com

The Babbling Brooks of the NYT Babbles about the Suicide March of Liberalism

 Abstract:  Brooks tempts the demons at the Times by playing with the hard political truths.  He seems to unwrap the dead fish embedded in the foundation of the Obama Farce and spread the aroma around just in time to encourage some moderate Democrats to sink ‘essential’ socialist programs like Health Care and other tax follies. He is dispropagandizing the populace with this heresy. He oddly equates the demise of both parties with a certain parallelism as they march to doom.  He credits the ‘moderates’ with garnering the fortitude to stop the Obama Juggernaut. He better get Herbert or Gail Collins to supervise his written work. He runs amok.

As we read the NYT—aka the Walter Duranty Papers[1][2]--a turn-of-the-crank Marxian siren, we must always be prepared to suffer violent assaults on simple logic or, most likely, suffer through a redacted and spun version of political and economic reality ensnarled with the news and the current urgent urgings of the despotic left.  The normally sticky nostrums and backward-looking conclusions are mostly tautologically wrought and boiled daily like tripe by the New York Times and today, as is their custom, the Chief Babbler David Brooks,[3] [4] speaks as a conservative token from The Old Gray Lady, and instructs us , surprisingly in the negative progress of the Obama administration’s  approval ratings. He needs some help.

Brooks begins:

“It was interesting to watch the Republican Party lose touch with America. You had a party led by conservative Southerners who neither understood nor sympathized with moderates or representatives from swing districts.”[5]-- Liberal Suicide March By David Brooks Op-Ed Columnist. July 20, 2009 [Emphasis is mine in all quotes.]

“It’s not that interesting to watch the Democrats lose touch with America. That’s because the plotline is exactly the same. The party is led by insular liberals from big cities and the coasts, who neither understand nor sympathize with moderates. They have their own cherry-picking pollsters, their own media and activist cocoon, their own plans to lavishly spend borrowed money to buy votes.”-- Liberal Suicide March By David Brooks

One can wonder what the difference is here.  The salient fact is that both parties lost control of spending and that is not so interesting as an element in history as it will be when inflation soars. Stay tuned for some excitement in the financial markets. We will make world history and set new records in the bond markets.

 Statistics:

 “Approval of Obama’s handling of health care, for example, has slid from 57 percent to 49 percent since April. Disapproval has risen from 29 percent to 44 percent. As recently as June, voters earning more than $50,000 preferred Obama to the Republicans on health care by a 21-point margin. Now those voters are evenly split.”-- Liberal Suicide March By David Brooks

I generally put enough of the original quotes from my targets in my blog to demonstrate to the reader the hard points and to ensure that what was blathered was not taken out of context.  The point here is that Obama promised a truckload of goodies for our wonderful citizens and we are going broke from massive spending and printing of money and face a depression. I wonder if Brooks can stumble onto this salient point.

 Some more:

 “We’re only in the early stages of the liberal suicide march, but there already have been three phases. First, there was the stimulus package. You would have thought that a stimulus package would be designed to fight unemployment and stimulate the economy during a recession. But Congressional Democrats used it as a pretext to pay for $787 billion worth of pet programs with borrowed money. Only 11 percent of the money will be spent by the end of the fiscal year — a triumph of ideology over pragmatism.”-- Liberal Suicide March By David Brooks

 We already knew this. Please get to the point! [hint: they want to tax everything]

 “Nancy Pelosi [a.k.a. Spartacus]^[6]has lower approval ratings than Di** Cheney and far lower approval ratings than Sarah Palin. And yet Democrats have allowed her policy values[sic[7]] to carry the day — this in an era in which independents dominate the electoral landscape.

 Who’s going to stop this leftward surge? Months ago, it seemed as if Obama would lead a center-left coalition. Instead, he has deferred to the Old Bulls on Capitol Hill on issue after issue.”-- Liberal Suicide March By David Brooks

 Only now do we learn from Brooks that some ‘leftist surge’ must be halted.

 One theory is that independents and ‘moderates’ are the simple, flop-eared drooling lackeys of the extremists. That concept may fit here.  They also have the strong support of Poncho the Parasite[8] and his legion of criminals including ACORN[9] who can, not surprisingly, vote in many states, legal, illegal, dead or alive.

 “That leaves matters in the hands of the Blue Dog Democrats. These brave moderates are trying to restrain the fiscal explosion. But moderates inherently lack seniority (they are from swing districts). They are usually bought off by leadership at the end of the day.”--Liberal Suicide March By David Brooks

I still wonder why Brooks and others failed to see what Nancy Pelosi and her Marxian slime bags had in store f0r us. We can hear the rants and listen to the ideological racism from Obama and his Angry Black Woman[10], an affirmative action disgrace, speak to us about ‘change’ as their political fine-tuning was stroked by Jeremiah Wright[11][12] and Bill Ayers and other racist and leftist vermin.

Brooks acts as if his entire body of knowledge resides in what was published in the NTY in the last week. Could he not see what California is becoming?[13]  David could not see that Obama is an ideological racist?[14][15]

From a previously edited blog:[16]

Senator Barack Obama told us about the ‘typical white person’ and denigrates whites[17] for ‘clinging to their guns and religion’ and escapes any accusations of overt racism by the left. Obama is an ideological racist, a bigot, an arrogant elitist and a racism enabler and all this welcomed by the rabid left as they grunt and grab at the tax base. He can listen to the rabid, racist howls of Jeremiah Wright and see nothing out of the ordinary.  He can explain all this. He cannot disown his pastor or church for what they said. Then, he did.[18]

Brooks acts as if he has intellectual tunnel vision and is expected to reflexively react only on points of expediency from the current talking points currently written in the murky ink of stark terror at the New York Times.  The Obama façade is crumbling and rotting before our very eyes. He has accomplished nothing while promising everything. He is a liberal hence a predictable loser.

California will show us[19] what liberalism is all about and how we can all become billionaires.  It is too late for the Blue Dog Democrats to do anything other than bawl. The government is broke and cannot do more than helplessly print money. Not spending more money is not the problem. We are broke.

I am going to paint my blue dog pink and brand him with a peace sign. The Democrats had already lost touch with America during the times of FDR. Somebody update Brooks.

rycK

 Comments to: ryckki@gmail.com

The Blush is Back on the Onion: California Has Arrived at a ‘Compr0mise.’

Abstract: California is finished as a society at least in economic and financial terms. Now, we learn that some kind of ‘compromise’ has been chummed out of the social latrines in Sacramento probably in a swirl of dope fumes and tears and other sticky bodily fluids.  This, after the voters recently and soundly rejected their slothful pleas for more and more taxes. Now, we have a ‘compromise.’ The compromise is a joke and does nothing to solve the criminal problem and state spending. Education is a joke in California so cuts there might not do any harm—the only bright spot on this infected animal.  They will continue to encourage illegal aliens to bring their poverty, crime and anti-Anglo racism to state thus keeping the ballot boxes stuffed so Dems can continue to soak up the last drops of blood from the shrunken remains of what was once a wonderful state.

 We all know that California is finished as a society at least in social, ethnic, moral and economic terms.[1][2] The Sacramento Parasites can view no other options other than to spend wildly on such esoteric nostrums as their versions of ‘education’ that rank the state somewhere near the bottom of the upper 48. They import poverty and coddle anti-Anglo haters at 10 billion dollars  a year in medical and other spending so as to stuff their ballot boxes and maintain power and then expect the rest of the US citizens to subsidize their hallucinatory society. Their best hope for the future is selling dope or legalizing kiddy porn. They are a mortification to organized society  and the world needs a to witness a severe  lesson on the effects of such patent  lunacy  and  see them crash in a financial maelstrom and then offer  lessons to their ‘leaders’ on simple arithmetic—something that must not be taught in their school systems any more. Socially and morally, they are worse than bankrupt. [3] California is now a containment facility for degenerates.

“SACRAMENTO, Calif. -- Gov. Arnold Schwarzenegger and California legislative leaders Monday said they reached a compromise to close the state's $26 billion budget shortfall.

Under the plan, state lawmakers would cut $15 billion in spending. The rest of the gap would be filled by taking funds from local governments and through one-time fixes and accounting maneuvers. The deal must still be approved by rank-and-file legislators, who are expected to vote on it Thursday.[4]”-- California Budget Deal Closes $26 Billion Gap July 21, 2009 By Stu Woo And Ryan Knutson [Emphasis is mine in all quotes.]

Oh! Goodie! They are going to ‘cut’ something. Let us see what that is---but the cut is only 15 bln out of 26?!! What be happening to dah rest??

“The leaders of the Democratic-controlled state legislature said that of the $15 billion in cuts, $9 biillon would come from education, $1.3 billion from state-worker furloughs and $1.2 billion from the prison system.

"For Democrats, I have to tell you that many of cuts we had to make, at another time, we would've thought unthinkable," said Assembly Speaker Karen Bass.

Ms. Bass also said that local governments "will have to share the pain." The state will take away $4.3 billion from local governments by borrowing from them or redirecting funds that had been earmarked for them. “--By Stu Woo And Ryan Knutson

Let us celebrate! The problem is solved.

But, looking closer we see a few small problems:

[1] If youse take monies from the locals then what do they do for police, counseling and frolicking in the moonlight while enhanced by drugs? How do you save so much in the prison system? Let out the perverts and druggies?

[2] Local municipalities seem to be suffering their own spending legacies and will melt down. They will go bankrupt as the state cannot.

[3] A potential bright spot in the wreckage that used to be a state might come from the cuts in ‘education.’ Given that most of California’s ‘school systems’ are abject failures,[5] a future study might show that the cuts did not lower the ‘quality of education’ in the Tarnished State.  That might encourage the voters to recommend more cuts next year.

[4] The nostrum that you can save money “through one-time fixes and accounting maneuvers” is so preposterous as to defy imagination.  Whatever ‘savings’ are inherent in this bag of bones trick will only be added to the very next budget deficit—starting right now.

  And, looking forward, can we see a fiscal ‘solution’ to the problem? Hell NO! Taking money from the cities and counties at the expense of the state only causes more problems. The municipalities would have to make cuts equal to what the state is stealing from them to get past next year’s budget. They will NOT CUT the phony state government employees and corral the teachers unions. That is the signal that they will NEVER solve this and a default is required to sort all this out. They need some bankruptcy type judge to adjust salaries and benefits and fire about half the state workers and stop funding illegal aliens.

 Tax revenues are down, to speak of only one reason, because people are frantically leaving California to escape the psychotic tax-maggoty that pervades every form of ‘government’ in the state.[6][7][8][9][10]  The State Government is just one big leprotic pustule that soaks up all revenues in sight to maintain jobs for the slothful, ignorant, dopers, illegal aliens and other undesirable form of life.  These idiots forced banks to make loans to illegal aliens and losers who had no credit and many had no jobs to speak of. This resulted in non-performing properties that formerly paid property taxes now defaulting.  Now, we have abandoned houses that have been stripped by criminals, their value mostly lost,  not paying city and county taxes and that tax burden will be forced upon any new purchasers, which are scant for obvious reasons. These are very poor investments.

 You couldn’t assemble a bigger pack of losers than the ‘elected representatives’ in California   if you chose names at random from the Tijuana phone book and indiscriminately assigned those jobs in California’s phony government and courts.

 There is NO solution here and no ‘compromise.’ The problem only grows worse. Next year, or maybe much sooner, we will hear about the 2010 deficits and they will, of course, exceed the 26 billon dollar mess we have now. Issuing IOUs does not solve anything—it only delays the inevitable penalty and scares away vendors from doing business with the state.  Perhaps CA taxpayers ought to pay their taxes in IOUs if that is accepted practice now.

 To end this screed:

 “Even if approved, the budget deal won't end California's financial problems. The state remains awash in home foreclosures and an unemployment rate of 11.6%—one of the highest in the nation.”-- By Stu Woo And Ryan Knutson

 California is fast becoming the Needle Park[11] of the Left Coast and will be difficult to expel from the union. It will just become worse so we wonder if many in the legislature in Sacramento are doing too few drugs. Why not just pass out crack pipes during legislative sessions in Sacramento? This ‘budget deal’ is a joke. The streets will be flooded with perverts and druggies and dope will surge like weeds in the unattended lawns.

This is hopeless. Move out!

 rycK [a 5^th generation Californian in exile]

 Comments to: ryckki@gmail.com