Welcome login | signup
Language en es fr
OccupyForum

Forum Post: Money in itself is worthless

Posted 2 years ago on May 24, 2012, 12:23 p.m. EST by arturo (3169) from Shanghai, Shanghai
This content is user submitted and not an official statement

During a bilateral meeting May 18 with Angolan President Jose Eduardo dos Santos, Argentine President Cristina Fernandez de Kirchner made incisive remarks about the insanity of the current, collapsing global financial system, which is based on the idea that money is worth something. Her words for sure didn't escape the attention of the City of London.

Fernandez stated, "I believe we now have an opportunity to show the world that a different model of accumulation, not that of financial profit and money in itself, is possible. Money by itself only reproduces when it goes through the market of production of goods and services; money by itself sitting inside banks, doesn't reproduce itself. It has to leave the bank and go to industry, agriculture, cattle-raising, and all services in order to reproduce itself."

Earlier the same day, in a speech before Angola's Legislative Assembly, Fernandez had emphasized that it is human beings, with their manual or intellectual labor, who generate real wealth, not the banks "that accumulate foreign exchange in their safes, but which later exist only in the computers' virtual accounting locations; then, when the moment of truth arrives, [the money] isn't there, and it's States that have to take charge of the mess the markets have made."

Fernandez told Dos Santos that "this is the great challenge and the message that we are constantly taking to the G-20. I've said this since the second one, held in London. It looks like this next one is going to perhaps be more interesting, because there are new actors; there are only a few of us left since the first G-20 held in Washington, and the truth is that those that left did so because of a democratic renewal, but also because the austerity policies they implemented have failed."

The Argentine President noted perceptively that her remarks won't be taken kindly "in certain quarters, of the old colonial powers which are today modern developed nations, who told us that their model was the only one to follow, but which has now so noisily collapsed. Financial profit as the only objective, disconnected from production or the value added from goods and services and from job creation, is what has produced this real financial crash which has collapsed on top of us, and when I say us, I'm talking about the South-South economies, that are emerging economies or ones undergoing reconstruction."

"This makes now more necessary than ever," she said, to strengthen the cooperation "which you [President Dos Santos] just discussed and in which you said governments exist to achieve inclusive societies, egalitarian societies with fair wages...that's what the founder of this nation, Agostinho Neto, and the men and women who fought with him, sought" for Angola.

"Today's location [in Luanda] isn't the G-20," Fernandez concluded, "but it's relevant. Today I want to take up again our common location — Angola-Argentina, Argentina-Angola — both begin with "A" which also coincides with the "A" of Atlantic. I would say we have a great opportunity, and it would be a shame to waste it."

http://larouchepac.com/node/22798

166 Comments

166 Comments


Read the Rules
[-] 1 points by JoeW (109) 2 years ago

You still need money to facilitate these transactions, it doesn't have to behave like the current monetary paradigm however. With a different set of rules backing the money, it would have very different effects

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

How do you see such a system working?

[-] 1 points by JoeW (109) 2 years ago

It kind of hard to see the future when its so radically different from our way of doing things now. But I see a lot of different currencies that have been specifically designed to solve a problem using unused labor and providing that labor with unused resources. Some are designed to take advantage of human nature. Brazil has a social currency to pay for college for the economically disadvantaged called the Conocer, for example, this currency has college seats and diplomas to back it up, but it starts in the hands of a first grader, and has to make its way to a college student before it can pay for anyone's tuition. This is done through tutoring, when the first grader is tutored by a second grader, hands over the currency, and so on, and so on. It fosters greater learning among all participants, pays for school with more economic and social returns during its lifetime than money of the traditional paradigm. Of course this money does devalue over time, and that actually provides incentive, newer Conocers are worth more, so people are trading theirs away quickly to make sure they get the most value out of it. This is called demurrrage and in a local currency it helps encourage investment in infrastructure by keeping the money in circulation and making the point of money simply to exchange goods and services, rather than as a store of value. So this type of money just moves stuff around to benefit all, without making it a contest of who has the most.

But on a deeper level, I can see it revitalizing democracy, if it is done democratically.

[-] 1 points by penguento (362) 2 years ago

Speaking of Argentina, here's what happens when the government fucks it all up:

http://news.yahoo.com/argentina-more-controls-buying-us-dollars-180240507.html

[-] 1 points by vikramdas (4) from Bronx, NY 2 years ago

The Argentine President noted perceptively that her remarks won't be taken kindly "in certain quarters, of the old colonial powers which are today modern developed nations, who told us that their model was the only one to follow,

http://www.amirafoods.com/index/safetypolicy

[-] 1 points by JoeTheFarmer (2654) 2 years ago

Money is worth what people will give you in exchange for it.

I can get a beer for $1 at happy hour.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

The point she is making is that without infrastructure, money isn't worth anything. Think about it, if you are alone in the desert but had lots of money, you'd probably likely die.

Our economic crisis is, to a great extent, a breakdown in our infrastructure, both public and manufacturing, since we put too much money into speculation, and then bailing out banks for their losses.

[-] 1 points by JoeW (109) 2 years ago

No, its a flaw in the way our money operates, not in the way we have planned our economy (that is rooted in how money operates) with a different operating system for money (or many different operating systems) we can change the effects.

The best analogy (grossly simplified) is that our money is a hammer, its a great tool, for a couple of things, but you can't use a hammer to cut wood (social welfare).

[Removed]

[-] 0 points by JoeTheFarmer (2654) 2 years ago

But I am not not the desert so money is worth a lot. I just got back from the grocery store and bought vegetables, fruit, soap, shampoo, a razor, orange juice, bread... Money is great in that situation.

Sure if the government prints more money for quantitative easement the value of my dollar goes down. That is why I invest in stocks, bonds, metals, and commodities. With a balanced portfolio you can protect yourself from changes in the system.

[-] 2 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Being able to protect yourself depends on how far the system breaks down and what our leaders choose to do. What if our society goes into chaos, like Mexico, with big drug gangs and lots of killings? Its already pretty bad in the border towns of Texas.

Also, there is a faction today that wants to use war in the middle east to either force the submission of Russia and China, which doesn't seem to be happening, or as a last resort, to create a nuclear WW3 to reduce global population.

[-] 0 points by JoeTheFarmer (2654) 2 years ago

What if....

When I was going to college while working full time I would do homework every night my friends wanted me to "come out and party" On friend said "What if you die tomorrow?" I responded "What if I don't die tomorrow and I live to be 80 years old? I want to have an occupation that will allow me to provide for may family." I continued to work and am still working hard to this day. The thing is, I enjoy my work. I thrive on it. I would be bored without it.

You cannot live you life on the pretext of what if.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

People need to know what is happening and try to do something about it. I'm not suggesting that one should not take care of one's daily life. I just think that too many people are blissfully unaware of critical things that are happening now and have no concept of trying to do anything about it.

I like my work too.

[-] 1 points by gnomunny (5783) from St Louis, MO 2 years ago

It may have been more accurate to say 'the value of money is relative.' Especially considering some of the replies below.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Thanks for the suggestion.

[-] 1 points by EdiblePlanet (50) 2 years ago

At least they are recognizing a problem and the solution.

[-] 0 points by Renneye (3300) 2 years ago

Good post arturo! Nice to know someone is still making sense.

[-] 0 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Thank you.

[-] 0 points by niphtrique (323) from Sneek, FR 2 years ago

Maybe we should state it like this:

  • The value of money is imaginary because money can be created at zero cost.
  • Gold and silver have value, because it takes labour and energy to get them out of the ground.

Because our money evolved from gold and silver many still think money has real value.

For the record, I do not recommend using gold and silver as money.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

And what about the importance of accumulating national infrastructure as real wealth?

[-] 1 points by niphtrique (323) from Sneek, FR 2 years ago

Real wealth are natural resources and using less natural resources will reduce the constant reduction of wealth the economy is causing. Instead of building roads and bridges, you can better drive less.

In eight slide shows Jay Hanson, the maker of the website www.dieoff.org, investigates the reasons why the current political and economic system fail. Limits to growth are politically incorrect and banned from the public discourse but they still exist. Capitalism needs more-and-more natural resources to fuel economic growth. In order to supply those natural resources, more-and-more energy is needed. Humans are social animals and their social instincts block rational solutions. Therefore humans must become aware of their social nature to solve the problems their behaviour is causing.

Economic theory is defective because it ignores human nature and the finiteness of the Earth's resources. All economic activity uses energy and natural resources. More economic growth equals to more poverty as natural resources are assets. Energy conservation will not help because in the current economic system any increased energy efficiency of a product will increase demand for the product, thus offsetting the effect of the increased energy efficiency.

Corporations exist to make money and for this they use finite energy and natural resources. During this process corporations transform natural resources into garbage. When energy and natural resources are gone, money will be worthless and the planet Earth will look like a garbage dump. Corporations are out of control because they control politics. Money is social and political power and enables people to buy the time and energy of others. Money allows rich people and corporations to manipulate poor people, to buy favours of politicians and to use the finite resources of the planet. Consequently there is no democracy in countries controlled by corporations.

Reference: http://www.naturalmoney.org/buildfuture.html

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Why do you say that energy resources are finite?

I believe that an infinite supply of energy resources are available throughout the universe which can be made available to us through science and the development of new technology.

[-] 0 points by DJdoodles (-56) 2 years ago

There's a lot of energy in the universe and we won't have to worry about depleting it anytime soon, but the second law of thermodynamics shows that this energy is not infinite. All the energy of the Universe comes from the BigBang, and eventually, all that energy will fade out has it gets transferred from one from of energy to another with lose of energy each time. It's like a fire, it eventually burns out. Research the Big Freeze.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Some people think the second law of thermodynamics is a hoax, meant to make us accept a collapsing economy and the depletion of energy.

[-] 0 points by DJdoodles (-56) 2 years ago

Some people think 911 was a hoax. They say the planes were holograms and it was organized by the American government as a false flag.

Unless evidence is provided, claims of hoaxes don't amount to much.

The second law of thermodynamics is backed up by mountains of evidence.

[-] 0 points by niphtrique (323) from Sneek, FR 2 years ago

Fossil fuels are finite. Other energy sources such as the sun may be abundant, but you must harvest the energy in an energy efficient way. So if producing solar panels cost more energy than they will deliver then you are on the wrong path. We can always count on future technology, but as long as it is not there, energy is finite.

[-] 1 points by DKAtoday (34876) from Coon Rapids, MN 2 years ago

How do you figure that cost and or benefit?

What is the life expectancy of a solar cell?

How many years will it collect sunlight and convert it into power/energy?

Will solar technology get better more efficient less costly over time and development?

Continuous Process Improvement. To do that you need a process to improve.

We have begun and all ready our oil needs have dropped.

[-] 0 points by niphtrique (323) from Sneek, FR 2 years ago

If you produce everything in China, your oil need drops. Well, great.

I do not know the details about solar and wind, but energy input must be lower than energy output, in order to have value.

Most people do not produce anything at all. They drive their car, go to their office (heated in the winter, air conditioned in the summer) and type some text into a computer.

They produce no crop and build no shelter.

You can bring down energy consumption with 90% if you concentrate on the essentials.

[-] 2 points by TitusMoans (2451) from Boulder City, NV 2 years ago

Even precious metals and gems have value only by fiat--that is they have little or no intrinsic value as far as human survival goes. Food, water, etc all have intrinsic value for humans. The essentials of human survival and well-being should be the most valuable of all commodities.

[-] 1 points by JoeW (109) 2 years ago

Historically this is how it was done in Egypt, they actually loled at the Greeks and melted down their currency for jewelry (and those golden and silver pyramid caps)

Farmers could store their wheat and receive a token in the amount stored that they could trade, when exchanging that token in, they would get a little less wheat (storage costs). Wheat deposited in one place, could be withdrawn in another. They also had a more dominating currency as well for the higher echelons and trade with other civilizations and peoples, but their two currencies existed in a balance until their final collapse under the imposed monopoly currency and conquest by Rome.

[-] -2 points by DJdoodles (-56) 2 years ago

I need oxygen to live. Does that mean that oxygen should be extremely valuable? Of course not since I can get some all around me all the time. (If I can't, then I'm dead). Value depends on need and scarcity, and is sometimes even subjective. Some people die for stuff that does not matter to others.

[-] 3 points by TitusMoans (2451) from Boulder City, NV 2 years ago

Oxygen is valuable to all of us. Without it we die.

It's abundance does not decrease its value. You make my point.

[Removed]

[-] 2 points by PR1 (120) 2 years ago

Does that mean you're a carbon based life form?

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

I agree about the solar panels.

On the surface of the moon, there is a tremendous quantity of the material necessary for producing energy through nuclear fusion, a clean and highly concentrated form of energy. We just have to organize ourselves to gain access to it.

I think that in the future, if we are to have one, we will also be able to extract vast amounts of energy from matter/anti-matter reactions.

[-] 1 points by niphtrique (323) from Sneek, FR 2 years ago

As long as it not proven I do not count on it. We have enough materials for nuclear fusion on Earth.

I have a technical background and have heard a lot of bogus stories about energy out of nothing.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Consider that a century ago, there was no proven capacity for getting us to the moon. That capacity exists today because somebody imagined it way back when. Its our imagination of the possible that creates the actuality.

[-] 1 points by niphtrique (323) from Sneek, FR 2 years ago

I guess that technology has screwed things up so completely that I do no believe in techological solutions.

In my imagination it is possible that robots will make humans obsolete. If that creates the actuality then robots will have unlimited energy in the future.

I am not a gambler. As long as the fairy tale imaginary energy simply is not there then I would advise to curb the use of energy.

[-] 2 points by arturo (3169) from Shanghai, Shanghai 2 years ago

I think it is more of a gamble to not invest in future energy resources, since it is quite certain that we will eventually run out of fossil fuel.

[-] 1 points by niphtrique (323) from Sneek, FR 2 years ago

I agree with that.

[-] 0 points by monetarist (40) 2 years ago

Money does not sit inside banks. Banks give loans, remember?

May be if u stopped reading larouche and went back to school to complete ur education, you might start talkin more sense

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

The point she is making is that without infrastructure, money is relatively useless.

[-] 1 points by webb5 (36) 2 years ago

I agree, money in itself has no real value; it is created out of nothing as a bank deposit. If we were suddenly marooned on a deserted island we would quickly understand that printed money has no real value.

Food and water is what we would really value. We certainly would not lie down and die because we could not buy them! Unfortunately we now put more value on money which today’s banks create as debt. We have lost sight on what is real wealth.

If a country discovers oil, coal or any other commodity worth millions of dollars, a basis for new money creation would be achieved. Money could be created responsibly to pay for the wages and for the equipment to extract these new assets. The value of minerals extracted from the ground is a basis for creating an equivalent amount of money. It should not be done in any other way.

Unfortunately the world does not operate this way. The private banks create all new money as debt and the spiral of debt continues leaving some nations worse than others.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Generally, I agree, but would add that the discovery of scientific principles is an even more important approach to creating value than discovering new deposits of natural resources.

[-] 3 points by webb5 (36) 2 years ago

money must be produced in correct quantities without cost. What man is physically able to produce, grow, build, and invent, must not be limited by lack of money but rather by the lack of resources. Trade need not be restricted by lack of money.

Below is a fictional story that we can relate to and learn from. Its about an island that came up with a solution, to the money problem.

In a remote island in the South Pacific, thousands of people could feed themselves, clothe them selves in fact supply everything they ever needed. The people lived in almost paradise and never went without. This was the case until a dark day arrived in their lives. It was discovered that almost two thirds of the island’s supply of shells (money) had disappeared and also it seems their chief banker. A crisis meeting was held with all the important chiefs in attendance. It was declared that the main supply of shells had disappeared which would put the economy in a perilous position. New shells were needed desperately or trading would come to a halt.

Bankers from Europe offered the islanders printed-paper (money). But this came at a great cost, Interest would be charged at a rate of ten percent and one third of the island’s assets were needed as insurance for the banker’s big risk. They were told this would bring them up to date with the modern world.

The islanders thought long and hard about this and almost agreed with the banks to borrow the printed-paper. Luckily a man from another island had seen this very thing happen to his own island. He told them that the banks now owned their island because they did not have the money to pay them back. They found too late that only the banks could supply this printed paper (money).

The banks forced them to give up their property and required that one third of the food they grew would now go to the banks for the next twenty years. There was much bloodshed lost over this until the united islands came in and ordered them to fulfill their agreements. The world islands bank offered them more money but this action made things worse (the interest was killing them!) The people no longer have a home, island or any possessions. They now owe more printed paper (money) than they did before.

The islanders took note of this and decided to revert back to bartering for six months until all the shells needed were collected. Although bartering was very cumbersome they thought it was a much better thing to do. A ton of wood for example was used as an exchange for six weeks supply of meat. After the shells were collected everything went back to normal.

The islanders in this story were self-sufficient and had every thing they could ever need. The shells they used for trade could easily of been replaced by rare feathers. They could also of printed their own debt-free money (If they had a printing press!) There was never any need to go into debt.

See also Money myth exploded http://www.michaeljournal.org/myth.htm

[-] 1 points by monetarist (40) 2 years ago

Without goods/service to buy money is useless. That should be common sense. Money is just paper. If there is no govt to back it or nothing to buy, money will b useless. She is not saying anything new or revolutionary.

Sure infra is needed but infra development needs to be related to overall economic development. Thr is no point setting up offices n houses in the centre of the sahaha desert if no one is gonna come thr. Similarly no point in making offices if u don't have ppl to fill those or enough demand for those offices to make money. They go hand in hand.

[-] 2 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Did you know the army corp of engineers has given our national infrastructure mostly C and D ratings? We have disasters waiting to happen all over the country.

The reason for this is that for the last fifty years or so, our system has encouraged the accumulation of money in the bank by the wealthy at the expense of maintaining existing infrastructure and developing new and improved infrastructure.

These ideas may not be new, but they are revolutionary in the sense that they are what our American revolution was originally fought for. We had to fight against a monetarist power, the British empire, to establish our right to develop our country, as opposed to just being looted for our natural resources.

[-] 0 points by tofree (5) 2 years ago

Money without believe is no money. these all sell the "shine" make her man as "Her mann". it is normaly called Koi means a Bank owner is a person which is a "animal" a koi person more or less. they do no have "farmer" there or "Hunter" or even "Human" no "Zoo". a king also a "animal" a koi person which is not the koi. asians are for example the kings there "seabears". koi is nothing which is asian in common. normally there are two ways the one over the sky to earth the other over the earth to sky. as a christian or arab for example you can become king on earth other tribe should be responsibe for shine. if you fight around shine it will never be the shine. a person who get shine thru fighting can never be a person which has something from shine. meanwhile they make in the entertainment companys since many years still always person which would be also "animals" in the signification but these do just so called "optionterms" murdering on Banks. the make her man as "her man". thru this you have just impostors and murder. these people are all just "would be something" means killed or are signification. these people all never make "her man" just her man. everything all just prostitution. over this entertainment . and so on.

[-] 0 points by tofree (5) 2 years ago

these musicians are never "animals" actors and so on. the make always her man as "her man" . this all is completly perverte.

[Removed]

[-] -1 points by RealityTime (-224) 2 years ago

Money is worthless, so send me yours. Of course you won't, so that pretty much confirms the bullshit of your post.

[-] 2 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Look at the billions that were lost by JP Morgan recently. Virtual money can vanish in an instant, not so with the infrastructure that supports a society.

[-] 1 points by jrhirsch (4714) from Sun City, CA 2 years ago

That money did not disappear, it was transferred. When one person loses another gains. The basis of all speculation and gambling. Somebody else in the banking industry is celebrating right now.

[-] 2 points by arturo (3169) from Shanghai, Shanghai 2 years ago

A lot of that money though was highly leveraged though, wasn't it?

[-] 0 points by monetarist (40) 2 years ago

Define leverage first. Besides how do u know it was leveraged? May be u can tell me the leverage ratio then.

And leverage is nothing wrong.

[-] 0 points by monetarist (40) 2 years ago

Another really dumb comment from u. "Virtual money can vanish.." lol u need to get ur brain checked

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

And I thought I told you to go out in the sand box and play.

[-] 0 points by RealityTime (-224) 2 years ago

I'm not saying money is worthless, you are. So, show me and send me yours. Otherwise, it just points out how even you know what you wrote is idiotic.

[-] 2 points by arturo (3169) from Shanghai, Shanghai 2 years ago

The point is that without infrastructure, money is worthless. For example if you are out in the desert, with a bunch of money, but nothing to eat, what good is that money to you?

And how does this relate to our situation today? Our infrastructure is currently rated as class C and D by the army corp of engineers. This is the case because our government has not invested in it. If it keeps getting worse, we won't be able to provide ourselves with the things we need.

Its not idiotic, it just takes a little more work for some people to understand.

[-] 1 points by RealityTime (-224) 2 years ago

But without money, we don't have an efficient way to invest in infrastructure. Money is an efficient medium of exchange. It helps us avoid the inefficiency of barter.

Now, on the topic of infrastructure, I agree, we should spend more. But we should do it in a way that makes sense. We should stop the political pork-based way of assigning projects. We should also eliminate federal employment rules that drive up costs. But we should we definitely still use money.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

That sounds fair enough, neither I nor the author of the above article are suggesting that we should get rid of money.

The point she tries to make is that our current system is set up so help the wealthy accumulate money in the banks, while what we need is a system that allows all of us to accumulate value as our national infrastructure.

[-] 1 points by RealityTime (-224) 2 years ago

Actually, our current system is set up to process entitlement payments. That's where the long-term financial problems are coming from.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

For me, the economic problem is primarily related to the switch of the US away from our original "American System" economic policies:

http://en.wikipedia.org/wiki/American_System_%28economic_plan%29

to British free trade policies.

[-] -1 points by RealityTime (-224) 2 years ago

Free trade has opened Americans lacking skills to huge low wage competition. Immigration of unskilled people has also hurt them (we've flooded our in-country unskilled labor market via immigration). So, two tough trends for people without much education.

Free trade has also opened a lot of new opportunities for more skilled people. People with skills have new markets, people without skills just have more competition. Today, a basketball player entertains people overseas that have become NBA fans and an architect might design a new building going up in China. An investment manager might now manage money for clients from the US as well as the Middle East or for some pension fund in Austria. His/her income has an upward bias because of this.

Trade has also made a lot of things better. Just think of the junk we'd be driving today if the Big 3 and the UAW were never challenged by competition.

Trade also ties us all more closely together as we build international relationships and dependency. It's a force of peace.

So, it's been tough for a lot of people, but it isn't just negatives.

[-] 2 points by geo (2638) from Concord, NC 2 years ago

Your theory doesn't explain why IT jobs are evaporating and being off shored to India and the Phillipines. IT jobs are not low skill, quite the opposite, they are highly skilled and need continuing education and recertifications constantly as the technology changes quickly.

I've watched whole departments get axed and their work outsourced. Thank you Free Trade.

[-] 1 points by RealityTime (-224) 2 years ago

I've seen some of that too. Telecommunications advancements have connected us now throughout the world. We can simply not interact with places like India. We could choose to do that. But I'm not sure how you stop the world from growing more interconnected. A country that tries to sit out this trend will be sidelined as the future develops.

It's intimidating to see those jobs leave. We can each make choices to be customers of companies that do less of that. We can buy American. I try to do both of these things. We can also not self-inflict pain by doing things like going into debt. Craft a life that's economically stable and turn your back on being in debt and chasing the latest thing that's sold to you. It's a bit of lowering your profile to more easily maneuver. This won't go away for another 30 years when global labor markets eventually lose their current over-supply.

[-] 2 points by geo (2638) from Concord, NC 2 years ago

Globalization and Free Trade are directly responsible. China will graduate 1 million engineers this year, India is graduating high tech people as well by the 100's of millions. All of whom can do our high tech jobs at a fraction of the cost.

There are very, very few jobs that are immune from outsourcing. It's not just low skilled jobs that have disappeared, as time moves forward more and more skilled jobs will be at stake.

I'm ready to end this Free Trade experiment, and move back to Fair Trade.

[-] 1 points by RealityTime (-224) 2 years ago

True, global interconnectedness is increasing and that creates vulnerability in a world with an over-supply of labor. That won't go away soon. But there are lots of advantages to doing business in the United States, so wage parity won't happen.

There's simply no way to exit the world. If we had, you'd be driving a 2012 Chevy Vega and we'd all be poorer as a result and the biggest winners would be those most unable to compete.

[-] 2 points by arturo (3169) from Shanghai, Shanghai 2 years ago

The point is that people will still work hard if they are paid living wages.

Understandably, cooperation works within competition, but now we need more cooperation between nations, rather than more competition, to solve today's critical problems.

If we don't want poor immigrants coming here, we should support policies that create good jobs for them in their own countries.

For example, China wants to buy high tech products from the US to develop their economy, this would help to create better jobs in China while reducing our trade deficit. But our trade ban does not allow us to sell these products.

There is some export of those items, but apparently not enough or there would not be so much poverty in the world.

[-] 1 points by DKAtoday (34876) from Coon Rapids, MN 2 years ago

Implement here at home and export world wide - Green technology.

Green Tech.

This is where we should be going: Green Energy we have the technology we just need to use it. This is what I am talking about. A clean future to be implemented NOW!

http://www.hopewellproject.org/

http://ecat.com/

http://www.wired.com/magazine/2009/12/ff_new_nukes/all/1

FuelCell Energy http://apps1.eere.energy.gov/news/progress_alerts.cfm/pa_id=600

[-] -1 points by RealityTime (-224) 2 years ago

Sure people will work hard, I get that. But avoiding work is natural and if I can erect a tariff to protect my industry, company, or job, I'll do it. Competition is hard and people naturally prefer pleasure over pain even though pain makes us stronger.

But nations cooperate all the time. We also compete all the time. There's clearly a mix. Most conflict is resolved through cooperation with management, mediation, and the power (if necessary) of the United States and other nations that share our values like Britain, France, and Germany.

If we don't want poor uneducated immigrants coming here, we simply don't allow it. We have a border and a right to enforce it. Every sovereign nation is entitled to an immigration policy, ours too. We don't have to just sit here with our pants around our ankles until all the world's problems get better.

The United States is a modern country. It takes skills to make it here. The average education here is about a year post-high school. Immigration of uneducated people, especially in large numbers, has an obviously predictable outcome when it comes to poverty. And let's be clear about what we're talking about. A big share of what's come in didn't even finished grade school. Walk me through how you don't know that generates poverty.

People don't like trade because of competition in manufacturing. But many of them support mass immigration of no skill people that blows the bottom off of wages in the service sector. And if you even bring it up, they smear you as a racist. We've created a servant class in the United States with a wide-open border. Nail salons, parking attendants, maid services, lawn service, car washes, and restaurants have all exploded on this low-end labor. It's been very bad for the country. In addition, struggling Americans face dirt low wages in no-skill service jobs because we've so vastly over-supplied the no-skill labor market.

Of course we're careful what products we sell to China. They have a very different values system than us and, not being complete idiots, we don't want to arm a potential enemy.

World poverty has a lot of causes. Probably the biggest are poor governance and unsupportive cultures and values. Next is probably civil strive and the like. Us being careful about certain technology transfer issues that pertain to weapons wouldn't make the top 1,000.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

"we also have brains in our heads and aspire not to do idiotic and unwanted big projects."

Who do you mean by "we"? Most Americans favor getting started on NAWAPA, the biggest aqueduct project ever in history, both because it would create millions of jobs and solve our burgeoning water problem.

Countries always become "corrupt crud holes" when free trade is imposed on them. Its even happening here.

"Self, where do you suppose that came from?" - Lack of jobs in their own country.

Create jobs globally and we reduce the police state globally.

[-] -1 points by RealityTime (-224) 2 years ago

I've never even heard of that project supposedly everyone wants. But whatever it is, I bet environmentalists are against it and whatever place you plan on taking the water from probably isn't too enthusiastic either.

Mexico was a corrupt crud-hole BEFORE trade liberalization. Trade is part of China's EMERGENCE from corruption and autocracy.

I knew you'd need more than one try to get it right. It's there because WE LET IT IN THE COUNTRY. The typical liberal mayor in the U.S. today simultaneously supports sanctuary AND "living wage" laws. It's fun to watch them be both in favor of the CAUSE OF a problem as well as its proposed solution. But, of course, the problem is an over-supply of the no-skill labor market that can't be repaired by government attempts at price fixing. That's why they fail.

It's fine to be in favor of open borders. But then don't bitch about the OBVIOUS consequences, the sort of consequences all but the willfully ignorant can see in places like L.A.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Mexicans would stay home if they could buy their own products from themselves rather than from the Chinese.

"The connection between lacking skills and poverty is OBVIOUS."

True, having industries in their own countries will help the poor to develop skills.

"The connection between immigration and burgeoning numbers of unskilled people is OBVIOUS too."

True, let's employ our own people producing factory equipment for those poor countries so they can have their own industries and jobs, while we create a sustainable income for ourselves.

"But we don't need a bridge or tunnel to Asia. Cooperation on boondoggles does no one any good."

This doesn't make sense, there's no reason we can't manage big projects effectively. Would you have opposed the building of Hoover dam or the electrification of the Tennessee Valley region?

Too much of poor governance and values and culture has been caused by imperialism in the developing world. Even here, look at our popular trash culture, paid for by financial oligarchs, the same people who bribe and black mail our politicians.

[-] 0 points by RealityTime (-224) 2 years ago

We CAN manage big projects effectively. But we also have brains in our heads and aspire not to do idiotic and unwanted big projects. There isn't a worthwhile project that is beyond what the United States can manage. Hoover Dam was built 80 years ago, we can do another one any time it makes sense (assuming the environmentalists let us).

Mexicans would stay home if their own country was less of a corrupt crud-hole and we enforced our border preventing them from wage and social services arbitrating our system.

The consequent poverty of mass immigration of unskilled people is OBVIOUS. We can continue the practice, but then try to find that little suppressed part of your brain that deals with reason and cause and affect and then knew better than to bitch about a "living wage", income skew, poverty and hispanics in poverty. Drive around L.A. sometime, find the poverty, and then ask yourself, "Self, where do you suppose that came from?" You're in L.A. Being in a place like that, but not knowing better doesn't say much for your power of observation and reasoning skills.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Protectionism was originally established to protect America from imperialism, not so that we could slack off and take it easy. If we withdrew from free trade agreements, we would set an example for other countries to do so. Then they would develop their internal economies and provide jobs for their own people eliminating our problem of poor immigrants.

To solve today's problems, nations need to cooperate on big projects. One example is a tunnel or bridge across the Bering Strait linking Asia with North America, as well as vastly expanding a fast rail network in America.

In their thousands of years of existence, the Chinese have never fought an aggressive war with the west. Its against their main philosophy - Confucianism. They just want us to revive our economy so that we can be their good customers, as well as to buy our high tech products. There is too much hate mongering in our media against China.

Most of the poverty in the world is caused by globalization, the continuation of imperialism. Its the cause of those other problems you mention.

[-] -1 points by RealityTime (-224) 2 years ago

So, if we stopped buying things from Mexico, Mexicans would stay home?

Our nation is entitled to a border and an immigration policy. Pants around ankles until all the world's problems are fixed, but then complaining about poverty in America is nuts. The connection between lacking skills and poverty is OBVIOUS. The connection between immigration and burgeoning numbers of unskilled people is OBVIOUS too. Obama went to El Paso to mock those in favor of immigration controls. He cited famous skilled immigrants like Einstein and I.M. Pei at a place where as much as a high school graduate probably hadn't crossed in 20 years.

But we don't need a bridge or tunnel to Asia. Cooperation on boondoggles does no one any good.

Great, but how about we don't sell them weapons just to be on the safe side. We sell China a huge array of equipment and services. We can leave out the stuff they could use to threaten their neighbors and us.

No, the poverty is caused by poor governance and values and culture. Now too as our modern medicines and such reach them, their populations have skyrocketed as fewer die off.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Being poor doesn't make a person work harder.

Cooperation is hard work as well, and it actually can be more productive than competition.

I don't see why unions should want backwardsness. Productivity gains should be their main source of profitability.

What you say about immigration has a point, but I think the more important point is that if people have a job that can make them middle class in their own country, it will make a lot more sense for them to remain there.

The US should go back to its old plan of exporting machine tools and other equipment on credit. Then as the poor nations install them in their economy, they'll create profit and be able to pays us back, giving us sustainable jobs, since these projects take decades.

[-] 1 points by RealityTime (-224) 2 years ago

True, but what's the point?

True, but lots of cooperation goes on within competition. Don't you know that people within Apple cooperate to make better products than Microsoft?

Great, but they don't and bringing them here has a lot of negative consequences. So, we just accept the consequences? Funny how someone so against buying a manufactured good made by a peasant in China is instead in favor of the Chinese peasant moving to the United States and lowering our wages here and creating local social problems.

We export a lot of what you're talking about. We import mostly low value things that were assembled in places like China. But things that Catepillar and Boeing make are for export. You should look too at where S&P 500 companies get their earnings. Much of it is from investments in other countries that are paying those returns you're talking about.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

We believe you are competing for the wrong objective. You're competing at making the rich richer and the poor poorer. We want a system that competes at increasing the middle class both in size and prosperity.

[-] 1 points by RealityTime (-224) 2 years ago

But competition that makes things better is important to preserve. Competition is hard work. Those that can create protections for themselves will take it to avoid that hard work. For example, if the UAW had its way, you'd still be driving that Vega. Trouble is, many special interests like that exist that want their protections too and that would happily take away the freedom of their customers for their own benefit.

If you want a bigger middle class, one way to attack it is to limit immigration of unskilled people. Too often, liberals want continued mass immigration of people without any skills whatsoever and smear anyone in favor of border enforcement as racist. But like trade abroad can push down wages, swelling of the unskilled labor poor via immigration does the same thing for low skill Americans. All these imported poor also stretch our safety net that could be going to our own people.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

But look at our economy today, the only thing you can say about it is that it is in a serious crisis. I believe the reality is that we are being bamboozled by slick operators into allowing ourselves to be ripped off by "free trade".

I'm not too concerned about the rich basketball players, but would like to see the common people make a decent living. We were doing that once, and then we allowed people to trick us out of it. I think we have to go back to the American way of doing things.

After WW2, Roosevelt was going to use the war time manufacturing economy to produce advanced equipment for the economies of third world nations. This would have made both us and them rich. Truman, however, was a traitor to cause after Roosevelt died.

Kennedy tried to resurrect the American way, and added the modern twist of the space program. I think we should do the same, start an FDR New Deal style recovery, combined with JFK's space age approach.

[-] 0 points by RealityTime (-224) 2 years ago

We're emerging from a painful downturn. But while that's a negative, it's hardly an argument that any other system could produce something better. They can't and haven't.

FDR did tremendous damage to the country. His big government Fannie Mae and FHA designed to save us then were never wound down and helped underwrite the housing bubble. He began the full-scale government pimping of housing when government had no business favoring anything of the kind. FDR also spent the 30's attacking business and free enterprise (like Obama) until he needed them to save the country during the war. And then we have the social security ponzi scheme now hanging over the country's future. The last thing we need is another FDR. Few presidents create such a legacy of damage.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Do you understand that what we have now is British free trade? That's the economic philosophy that we fought against in the revolutionary war. But now you say that same free trade policy that we fought against is the best?

That was the system of the British empire, it was the system of imperialism. Free trade serves the same purpose today, which is to make the people of nations submit to the empire. The wealthiest people who benefit most from free trade are today's imperialists, and today they run their empires as financial empires.

Of course we should want a system that protects us from imperialists, and just because this is the twenty first century doesn't mean there aren't imperialists any more. There is the same class of people and they have the same objectives today.

[-] 1 points by RealityTime (-224) 2 years ago

It doesn't make anyone submit to anything. It's an invitation to join the modern world. They can refuse, but they don't want to. Trade with the United States presents an upward path for the people of those places. Without it and things would be much worse and the path upward would at a minimum be vastly delayed.

Their poverty isn't because of us, it's because of them. Their societies lack development and the cultural and legal systems that we have. They also often lack stability or basic freedoms. That's on them, not us. But with trade, they have a shot.

[-] 1 points by DKAtoday (34876) from Coon Rapids, MN 2 years ago

Solving the immigration problem is a matter of making the world a better place to live.


To President Obama: You can put an end to indefinite detention. I urge you not to appeal the recent ruling by a federal court that makes it clear that indefinite detention violates the Constitution.

To My Senators: I urge you to stand with the Constitution and oppose indefinite detention during the debate on this year's NDAA.

Support the Constitution of the United States of America. Do not allow the interests of the greedy few destroy our society, our country, our world.

Set the justice department onto the real criminals - the white collar greedy criminals running rampant. Prosecute the economic criminals and put an end to the culture of white collar crime.

End strife in this country and then by extension the world.

Implement green technology and export it to the world. End strife over poisonous fossil fuel.

Green Tech.

This is where we should be going: Green Energy we have the technology we just need to use it. This is what I am talking about. A clean future to be implemented NOW!

http://www.hopewellproject.org/

http://ecat.com/

http://www.wired.com/magazine/2009/12/ff_new_nukes/all/1

FuelCell Energy http://apps1.eere.energy.gov/news/progress_alerts.cfm/pa_id=600

Export peace health and prosperity start here at home. Show the world that the USA is not hypocritical.


[-] 0 points by RealityTime (-2) 13 minutes ago

Solving the immigration problem means manning the border and enforcing our laws.

↥twinkle ↧stinkle permalink

[-] 0 points by arturo (3169) from Shanghai, Shanghai 2 years ago

"wailing about a "living wage" and such is plainly stupid if you don't have the sense to stop the inbound flow of poverty."

The way to stop the inbound flow of poverty is to create jobs in poor countries. Same in the US, create productive jobs for poor people rather than grow the police state.

Big projects in poor countries can have an immediate impact on reducing immigration the moment they are initiated.

[-] 0 points by RealityTime (-224) 2 years ago

You're just too funny. Well, snugged up there 1,500 away from the problem, in a suburb at that, I can understand your ignorance. Maybe the Somali's ransacking Minnesota's social safety net will change your mind. But that's right, you don't even pay taxes, so that's another layer of insulation against having to give a damn.

We solve our immigration problem at the border and by enforcing our laws.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

"Solving the immigration problem means manning the border and enforcing our laws."

Our people should have more productive things to do than manning our borders. We didn't have such big problems with immigration before free trade. Solve the problem at its source, create productive jobs in poor countries.

[-] 1 points by DKAtoday (34876) from Coon Rapids, MN 2 years ago

You Bet.

Wouldn't it be great if instead of throwing billions of dollars away every year sending out financial aid to countries aid that does not make it to the populations of those countries but to the ruling regimes.

How about instead - we take that wasted ( flushed down toilet ) money and buy goods and services right here at home and ship this to the needy countries around the world.

Money straight into our economy supporting business and jobs of all sizes. Shipping out the materials needed to make the impoverished lives around the world better.

Hell exporting green tech not only reduces the need of poisonous fossil fuel environment wrecking industry - it also supplies jobs in implementing that technology as well then running and maintaining that technology.

Jobs at home jobs overseas.

Clean power generation - no fossil fuel strife.

An investment in the future of the world. A real healthy and prosperous investment.


[-] 1 points by arturo (1407) from Los Angeles, CA 0 minutes ago

"wailing about a "living wage" and such is plainly stupid if you don't have the sense to stop the inbound flow of poverty."

The way to stop the inbound flow of poverty is to create jobs in poor countries. Same in the US, create productive jobs for poor people rather than grow the police state.

Big projects in poor countries can have an immediate impact on reducing immigration the moment they are initiated. ↥twinkle ↧stinkle permalink

[-] 0 points by RealityTime (-224) 2 years ago

Sure we did. We had massive immigration in the early 1900's and we met it with changes in the law. But at least back then, what come in with about at parity skills and education-wise with what was already here.

But the consequences have deepened. The more educated and complex our society becomes, the more serious the problem of drop-out immigration. The gap between what comes and the educational attainment that underpins our standard of living has grown. That increases the downside of immigration of unskilled people. Adding huge numbers of 6th grade educated people as we've done to a society with 1 year post-high school is a powerful force averaging down the country. Let's play a game. If the average of a group of numbers is 13 and we start adding a bunch of 6s, does the average a) rise; b) fall; c) only meanies ask questions like that?

Obama is pretty funny on this stuff. He talks quite correctly about the need for education and even has a national goal for the share of the population he'd like to see with college level training. He correctly talks about our need to compete with other countries and how education is a key to that competition. But then he turns around and supports mass immigration of drop-outs which does exactly the opposite.

Abdication on the border until the world's problems go away is simply stupid. Wringing your hands about poverty in America and wailing about a "living wage" and such is plainly stupid if you don't have the sense to stop the inbound flow of poverty.

Importing goods makes us poorer, but importing poor people makes us richer. Yeah, I need a little more time to work through your "logic".

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

To solve the problem of growing poverty in America, it is important to understand the cause, which is the outsourcing of jobs over the past decades. I'm not advocating transfer payments, but rather a return to a productive society.

Solving the immigration problem is the same, a productive nationalist economy in the countries that poor immigrants are coming from.

[-] 3 points by francismjenkins (3713) 2 years ago

There's no reason for us to think that poverty could or should be alleviated by draconian enforcement of unjust immigration laws (tearing families apart, destroying the lives of other human beings, etc.). This is what the 1% wants, create tension between the poor and our immigrant community (a truly disgusting and reprehensible tactic).

The 99% won't be divided by their savage, bottom feeding rhetoric.

[-] -1 points by RealityTime (-224) 2 years ago

Solving the immigration problem means manning the border and enforcing our laws.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

What about our poverty? We have growing poverty in the US and it will continue growing, until we do the things we need to do to stop it. What do we want to do, become like the worst of the developing countries with no high level jobs, all poor people and just a few rich?

Time is my best ally. I began studying about the financial crisis years before it happened, and tried to warn people about it, but they wouldn't listen to me. Its the same now, people don't listen but they will inevitably find that things will get worse unless we have Glass Steagall and a recovery program.

How much of global economy do we want to loose before we get on the path to recovery?

[-] 2 points by richardkentgates (3269) from Fort Walton Beach, FL 2 years ago

in reply to http://occupywallst.org/forum/money-in-itself-is-worthless/#comment-747138

How long do you suppose it will take to lift south America out of poverty enough for wage increases to be a valid issue here in the US? 20 years? 30 years? Ever? Your suggestion has no base in reality as it's pits american working class wages against an indefinite and questionable resolve and in such a span of time may contribute to the collapse of the entire US economy making US wages a non-issue and leaving no money for the projects you suggest should be funded by the US. Aside from being a complete fallacy, it's an economic paradox.

I value many of your opinions but this is not one of them.

[-] -1 points by RealityTime (-224) 2 years ago

We do have growing poverty. Leftist transfer programs designed in the 60's have done nothing to move poverty. They failed, yet that doesn't stop leftists from simply wanting to increase transfer payments.

If you are concerned about American poverty, demand your representatives enforce our immigration laws and reduce immigration of people without skills and therefore no shot at not being poor once they get here. Mass immigration of poor people with dramatically higher birth rates than the rest of the population is a poverty factory. It should stop.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Looks like this is something we disagree on.

[-] -1 points by RealityTime (-224) 2 years ago

Guess so. One of the many problems with government schemes designed to save us is that they don't go away and like Fannie Mae, FHA and government meddling in housing, they come back to do more damage than they were ever worth. Social security is an incredible ponzi scheme. Life expectancy of a worker is +10 years since the '30s and yet social security eligibility is only +2 years and that still isn't fully implemented. Social security disability is also filled with abuse and our pandering government lets it happen. FDR began that scale of pandering and it's what's driving our long-term insolvency.

[-] 3 points by VQkag (930) 2 years ago

Wrong answer! I win! You resort to simple insults because your arguments are weak. stop speaking for the 1%. They do not serve you! They use the 99% against us. We are the 99% We need each other. Support OWS. Vote out pro citizens united politicians.

[Removed]

[-] 0 points by RealityTime (-224) 2 years ago

Take a little responsibility for yourself. Honest, your life will get better once you try.

You aren't the 99%, you're the 1% that can't figure out even the basics of living as a grown up.

[-] 3 points by VQkag (930) 2 years ago

The govt is not at the top of this crime of theft against us. The 1% bought them long ago. So It ain't the govt taking from us. It is the 1% who have stolen that govt, Rigged the system by changing laws (tax, regulation) to favor them and hurt the 99%, Who claim to be job creators but instead outsource, downsize, move hq and income overseas to avoid taxes. Bust unions, steal pensions, and destroy industries and towns just to make a profit. A profit they never reinvest in the working citizens. It is treasonous the way they have exploited us. YOU and me. Support OWS vote out anti buffet rule, pro norquist politicians!

[-] -1 points by RealityTime (-224) 2 years ago

Your head is swimming in propaganda.

[-] 2 points by VQkag (930) 2 years ago

Just more name calling! You are not describing the people I have seen. Seems to be just a fantasy, an effort to demonize your fellow working americans who are smart enough to identify the criminals who wrecked our economy. And who are brave enough to stand up to the powerful 1%, and the foolish tools who speak for the 1%. brave enough to stand up to police brutality, untrue labels, abuse, and lies! Support OWS. vote out pro norquist politicians.

[-] -2 points by 67192206161 (-56) 2 years ago

Who are the "pro norquist politicians", VQkag? Please post a list of their names, positions and political party affiliations.

[-] 2 points by VQkag (930) 2 years ago

I hv been to many protests. Most people I hear are smart, all ages, not lookin for hand outs. They want to correct the criminal redistribution of wealth from the middle class to the 1%. Your view seems to be that of the skewed media reporting.

[-] 1 points by RealityTime (-224) 2 years ago

Ha Ha. They're a mix of directionless 20-somethings that have a neediness to belong to something... anything. They're mostly just ignorant and entitled. Then there's the more deeply mal-adapted that'll never be able to function very well. Then there's the lifelong socialists that've been pissed off since at least the 60s. Then, of course, let's not forget the public employee unions that want to further fleece their neighbors that don't work for government.

[-] 2 points by VQkag (930) 2 years ago

My life is fine!. And irrelevent to this discussion. I take care of myself and have done so for decades. In addition I have taken care of elderly family, and spouses, and children. I want nothing for myself. I am agitating change for my country because I see that the current situation is hurtful to the 99%. Because I see the 1% taking advantage of us all. Honestly! The 1% doesn't need 99%'rs to advocate for them. They have politicians, accountants, lobbyists, lawyers working hard getting them what they want. We have lost any influence in our govt to their dishonest efforts. Worst of all they have convinced half the 99% to vote for the interests of the 1%. Vote you own interests!. don't be fooled. YOU are the 99% Support OWS Vote out pro wall st politicians

[-] -1 points by RealityTime (-224) 2 years ago

Great, show up at a protest and tell some of the directionless 20-something about, I dunno, crazy stuff like reading what you sign, that borrowing money is a choice, that for government to give something away it first has to take from someone else... you know, the life skills you claim to have. LOL.

[-] 2 points by VQkag (930) 2 years ago

The people @ the top live longer and so get more benefits even though they stop paying payroll deduction @ the same level as middle class. whatever benefits are offered, it is immoral that the deduction hit the lowest income people and stop @ 100K! It should start @100k! and if we didn't have these govt programs our elderly would die in destitution alone, sick, and eating cat food as they were before the great FDR. Since we have no compassion for others (not even our own elderly family members) these programs are inevitable. If we respected the elderly for their experience and wisdom and felt some responsibility to keep them out of poverty we would be better people and have smaller govt.! Support OWS. Vote out pro SS privatization politicians

[-] 0 points by RealityTime (-224) 2 years ago

Social security was supposed to be about paying taxes now and drawing benefits later. The taxes had a limit because benefits had a limit. Pretty simple stuff.

Sorry, people are quite as helpless as the big government types would have us believe. One of the reasons people don't have what they need in retirement is because of what government took from them while they were working.

[-] 2 points by VQkag (930) 2 years ago

Disability fraud should be found and prosecuted. That won't solve the problem. We should just end the cap on the level of income we take SS payroll deduction. No reason it should stop at 100K income (whatever it is now) If anyone should get a break on the SS income deductions it should be lower income workers not higher income workers. What kind of sense does that make.

[-] 1 points by DKAtoday (34876) from Coon Rapids, MN 2 years ago

Also those who deny legitimate benefit coverage. When I was going through the process having already been denied once.

I got fortunate and was told of an advocacy group that helped the disabled get their coverage. The Chamberlain Edmond's Group - non profit - no fee charged.

The 1st time I stopped in for an interview - I was waiting for my appointment - sitting out in the empty hallway - and all of the sudden out of the corner of my eye I could see a confusion of movement.

I looked to see what was up and here came this guy all by himself literally vibrating like a jello man as he shambled down the hallway. It took him awhile to reach the place where I was sitting and it turned out that he was also there for an interview. We talked briefly and he said that he had a degenerative nerve disease ( I can't recall if he told me the name ) - anyway he wished me luck as this was his 5th attempt to receive benefits. My jaw bounced off of my chest at hearing this - because here was this guy standing before me and just in maintaining a standing posture you could see his spine rippling with unreal lack of motor control. I never saw him again after that day but - I keep thinking what an absolute wreck this guy was and he had been turned down 5 times. I was seriously depressed after that encounter.

[-] 0 points by RealityTime (-224) 2 years ago

It should be, but it typically isn't. In fact, government encourages the fraud as it too often rubber stamps the claims.

Sure, I know, just take more, the answer to everything. There is a reason it stops a little over $100k. It stops because benefits stop. Naturally, you don't plan on backing up those higher taxes with later higher benefits, correct?

They already pulled this stunt with Medicare as that program too explodes in benefits paid. My mom bitches about her Medicare premiums as she draws vastly more than she paid and while my taxes, without ANY current benefits, are wildly higher than her premiums. She's supposed to complain and I'm supposed to just take it. As more and more people build a sense of entitlement, the worse and worse fixing problems become.

Within social security, it already has a progressive element. First, because it's a ponzi scheme and has been paying out way more than people put in. Second, because payout ratios are better for people in the middle than they are for people at the top.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

For me, this is mostly propaganda originating from Wall Street and the empire it represents.

[-] 0 points by RealityTime (-224) 2 years ago

That's great. Yeah, entitlements are sustainable and FDR putting the government into the business of pimping housing was a really great idea.

[-] 0 points by DKAtoday (34876) from Coon Rapids, MN 2 years ago

Sure sure - and the drug prohibition war is going successfully too. Lets throw away more money on failed practices. Instead of addressing the heart of issues.


[-] 0 points by RealityTime (1) 4 minutes ago

You're just too funny. Well, snugged up there 1,500 away from the problem, in a suburb at that, I can understand your ignorance. Maybe the Somali's ransacking Minnesota's social safety net will change your mind. But that's right, you don't even pay taxes, so that's another layer of insulation against having to give a damn.

We solve our immigration problem at the border and by enforcing our laws. ↥twinkle ↧stinkle permalink

[-] 1 points by JesseHeffran (3903) 2 years ago

I'd say the Free Trade we have does the exact opposite of what you purport. When our companies set up shop in other nations and ravage foreign economies, It always falls on our military to bail them out. United Fruit, exxon Mobile and other multinationals are always getting us involved militarily when they wear out their welcome on foreign soil. Where as our populous seems to be docile towards corporate malfeasance, other nations kick onerous companies to the curb, then said companies go whining to the gov't about lost revenue because of new national regulations. Free trade is when we trade goods. What our companies practice is wage arbitrage, which breeds anxiety and content in the host nation. As long as are army is used to settle economic disputes in foreign lands, there will not be peace. We should be shipping goods to foreign lands, not factories and capital, which seems to be what FREE Trade has boiled down to.

[-] 0 points by RealityTime (-224) 2 years ago

"Ravages" foreign countries? Huh? Always falls on our military to bail them out? Huh? No we don't and our military isn't used that often for what you're talking about.

There's is a sort of labor arbitrage. But that isn't new. Labor is a cost of production. Lower costs are what it's about. Labor costs are managed within country too by choosing different locations and matching skills (and pay) to the task at hand.

Our military keeps the peace. Without the US, the world would be a much more violent place.

[-] 2 points by JesseHeffran (3903) 2 years ago

Well, if you take the long view of history, From south America, United Fruit, To the middle east, Exon Mobile, Yes, our military is used way too much as corporate enforcers. Keeping the peace? Wow, spoken like a true acolyte. You need to get your head out of the TV and into a book, son. We keep the peace with bombs and drones, or so MSM leads us to believe, but the reality is we spread economic hardships and then when the populous gets upset we Wage Peace. Also, as an American, I could give two shits about comparative advantage. It is not advantageous to me so who cares.

[-] 1 points by RealityTime (-224) 2 years ago

Conflict has been greatly reduced with American power. Death by war as a share of the population is probably at a low point in the history of humanity.

Yes, we keep the peace in part with power. You might want to imagine a world where our enemies and the values they represent go unchallenged.

[-] 1 points by JesseHeffran (3903) 2 years ago

Yeah, how dare they challenge our hegemony.

[-] 0 points by RealityTime (-224) 2 years ago

It's cliche to hate America, don't bother to think. American power has brought peace simply unknown in the history of humanity. Hate to break it to you, but we're the good guys in this imperfect world.

[-] -1 points by penguento (362) 2 years ago

The Argentinians are hardly in a position to preach to other people about fiscal management. A few years ago they defaulted on their debt obligations the way Greece is doing and very nearly wrecked the country. Grade schools had to plough up the playgrounds and plant gardens so the kids could get a meal every day.

[-] 4 points by arturo (3169) from Shanghai, Shanghai 2 years ago

I think both Greece and Argentina will be better off getting out from under the thumb of international finance.

[-] 0 points by penguento (362) 2 years ago

They will indeed. Most certainly Greece will. But only if they can learn to become more responsible about their own financial management. In both cases, the reason they got themselves under the thumb of international finance is that for a long time, they spent a lot of money they didn't have and foolishly borrowed it from other people; and it got to the point that they couldn't pay it back, and no one would lend them any more. If they continue to do the same thing, they'll just repeat the same cycle again.

[-] 2 points by arturo (3169) from Shanghai, Shanghai 2 years ago

I think you have to consider the role of the financiers as well. Their lending practices could well be considered "predatory".

[-] 0 points by monetarist (40) 2 years ago

This is not the first time greece has over spent and screwed its economy. Don't blame banks. The greek govt is not a bunch of illiterate hacks, they knew full well what they were getting into.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

I think that in a lot of these kinds of cases, the banks use money to corrupt the politicians.

[-] 0 points by monetarist (40) 2 years ago

Do you have an iota to evidence to support ur statement in the case of greece? In case of greece the govt wanted to continue borrowing to support its massive and disproportionate populist spending.

[Removed]

[-] 0 points by penguento (362) 2 years ago

Maybe, maybe not. But that's beside the point. If Greece defaults on its debts (which for all practical purposes it has already done), the financiers are out of it. They lose their money, tough shit for them, Greece gets a windfall. But that doesn't solve Greece's basic problem. Greece's problem is that they won't lend Greece any more money, and Greece doesn't by a long shot collect enough in taxes to pay for the things it has promised its own people. That's why it was borrowing money in the first place.

You can't have it both ways. If they were predatory for lending the Greeks the money in the first place, you can't criticize them for shutting off the money taps. And if they shut off the taps, as they have, then the Greek government has to be much more responsible with its finances, because nobody else is willing to lend them any more money either.

[-] 3 points by geo (2638) from Concord, NC 2 years ago

Financiers do have it both ways. The lend money to Greece and hedge it with derivatives if their bet on a return does not materialize.

Greece is in the situation it is because it does not issue its own currency, thus being saddled with foreign debt, payable in foreign currency.

[-] 0 points by penguento (362) 2 years ago

Hedging is a side issue, and not terribly relevant to Greece's problems. You can buy an insurance policy on virtually anything; and the hedging transactions are with third parties. They cost the Greek government nothing.

Going back to its own currency solves one problem but creates others. The government gets out of debt because it can print as much money as it wants. But each dollar or drachma or whatever represents a little slice of the economy. Print more money without expanding the economy and each one is worth that much less. And everybody who is owed money or receives money in Greece or per Greek law, including Greeks who are paid with it, or have money in the bank or in a retirement fund, or who get a pension check, gets screwed because their money gets progressively devalued. There's a lot of history and many examples of this to look at. Countries that are highly in debt that print money to solve the problem always impose severe hardships on their own people in the process. For Greece, it may be the only remaining option, but no one should kid themselves -- if it happens, it's going to hurt.

[-] 3 points by geo (2638) from Concord, NC 2 years ago

Hedging is a side issue, and not terribly relevant to Greece's problems. You can buy an insurance policy on virtually anything; and the hedging transactions are with third parties. They cost the Greek government nothing.

Don't switch sides now, I was addressing your comment about financiers not having it both ways- predatory in nature and low risk.... nothing about the Greek Government.

Going back to its own currency solves one problem but creates others. The government gets out of debt because it can print as much money as it wants. But each dollar or drachma or whatever represents a little slice of the economy. Print more money without expanding the economy and each one is worth that much less. And everybody who is owed money or receives money in Greece or per Greek law, including Greeks who are paid with it, or have money in the bank or in a retirement fund, or who get a pension check, gets screwed because their money gets progressively devalued.

In a fiat currency system where the government is the monopoly issuer of currency the rules are different. Inflation is the only constraint, and to what degree acceptable inflation is. I would hope that you have the time to read this:

http://neweconomicperspectives.org/2012/05/playing-monopolis-monopoly-an-inquiry-into-why-we-are-making-ourselves-so-miserable.html

[-] 1 points by penguento (362) 2 years ago

I read the article. Interesting, but I think there are some things I'd argue with in the theory. Given its length and complexity, I'll not do so at the moment. I would, however, point out some practical matters.

First, the U.S., like virtually every other country, already has a fiat currency. They print as much currency as they think they need whenever they need it.

Second, they already inject currency into the economy in the attempt to stimulate economic activity. The so-called quantitative easing that they attempted a while ago, and which they are thinking of doing again, is precisely that. They printed a batch of money (for the QE, quite a large batch of $600 billion), and bought back government debt with it. The goals were two -- to make the deficit appear to be smaller by monetizing it, and to do exactly what the monopolize game contemplates -- increasing economic activity by injecting money into the economy. They even paired it with the "shovel-ready" public works program, so the parallel to the Monopolize game is pretty complete.

The QE had little effect, except for a bump in inflation. And therein lies the rub and the flaw. The money itself has no value. Each currency unit represents a little bit of the economic output of the country,and is itself nothing more than a fungible coupon redeemable for that little slice. In the real world, when you inject currency into the economy faster than economic output grows, you get inflation. That's why central bankers are always worried about the money supply. It has to stay in rough parity with the economy, otherwise you get inflation or deflation. When you inject excess money, the economy magically soaks it up and compensates by raising prices on everything. Nobody controls this, and apparently nobody can stop it. It just happens. You certainly can't stop it by fiat. Imposing price controls is always a failure, and leads to black markets and other undesirable things. And trying to stay ahead of the inflation curve by putting out more money simply leads to a recursive cycle of inflation and money printing. All of this has been tried many times in many countries, so we have a lot of examples of the outcomes.

The final practical flaw is that the Monopolize game (as economists are often wont to do) assumes that people will rationally and calmly accept that the currency has some standard prescribed value and act in accordance with the rational decision-making process assumed by the theory. That just isn't the case, and is probably the source of all the issues I just discussed. In the final analysis, when you use currency, you're asking people to trade things of value for an essentially worthless piece of paper. When they do so, it's an act of faith in the currency-issuing entity, and if they lose that faith -- which can happen very quickly -- the whole thing falls apart. People being what they are, they can lose it for all sorts of reasons, rational and irrational, and when they do, once again we have lots of real-world examples of the results: black markets in goods and services, currency black markets, private currencies, the use of foreign currencies, barter economies,etc., etc. And try though governments do, they can't keep the real economy from doing all of these things, or from setting a real value on the currency based upon whatever calculation it is that people use for these things. Price controls, currency movement restrictions and all the other things that governments use to try to stop all of this are always defeated by people's ingenuity and persistence. It may all be irrational, but that's what people do, and until someone figures out a way to stop them from doing it, a pure fiat currency regime as proposed in that article won't work.

[-] 1 points by geo (2638) from Concord, NC 2 years ago

Good reply. You are correct on everything you wrote, except I would say when excess currency is created a key way to stop inflation is to raise interest rates.... make it more profitable to not invest in commodities that are the basis for everyday living like, foodstuffs and energy. These are the sectors where we are seeing the inflation take place today.

I'm not a fan of monetizing debt via QE, to me thats not a smart move. We don't need to float bonds to increase the money supply.

[-] 1 points by penguento (362) 2 years ago

By the way, on second thought, I think there are in fact places where a pure fiat currency would work. Germany, for example. Germans have an enormous respect for law and authority (which has its own problems, to say the least), and I'd bet that you could impose a pure fiat currency there and the vast majority of Germans would comply without a squawk. I was in Germany visiting relatives shortly after the fall of the Soviet bloc, and in those days you could buy surplus Warsaw pact militaria by going down to the Brandenburg Gate and buying it from street peddlers on the black market -- cash transaction, no taxes, etc. When my relatives found out I was doing this, they were horrified -- absolutely mortified -- about it. Not that I was buying surplus Soviet military junk, but that I was transacting business with a an illegal peddler with no business license and not paying taxes on the transaction. They thought this was just appalling. Germans do NOT patronize those peddlers - only tourists do. And I think they'd have exactly the same response to a pure fiat currency regime. That's probably why their economy is doing so much better than the other EU countries. The Bundesbank serves up a dose of medicine, and the Germans take it without complaining and without cheating, so it works.

[-] 1 points by geo (2638) from Concord, NC 2 years ago

Culture certainly plays a part in discipline. We are still a bunch of cowboys thinking the world is the wild west.

[-] 1 points by penguento (362) 2 years ago

You're right. And it's absolutely ingrained in the culture. In some respects that's a good thing -- that German respect for authority certainly has it's downside. Our own inherent distrust of government is in many ways much healthier. But our mentality also has its own downside -- and outright stupid side. Just the notion of changing the design on the money has caused an enormous ruckus over the years, much less some attempt at substantive currency reform; and of course there are many other examples, large and small of the same foolishness: opposition to the metric system, dollar coins, you name it.

[-] 2 points by geo (2638) from Concord, NC 2 years ago

I do hold out that a fiat currency can work here. Our main problem as I see it is that the Federal Reserve is staffed with neo-liberally trained economists who really don't understand the practical operations of our currency. I would love to see it staffed with some MMT trained economists and let them give it a whirl. How much worse could things get after Greenspan?

[-] 2 points by penguento (362) 2 years ago

I don't disagree with you. There's no inherent reason it couldn't work properly. The real issues are:

Politics. Economic policies are subverted for short-term political gain.

Economic theories with no connection to reality. Take the efficient market theory. It was provably false the day it was propounded. By then, speculative bubbles and panic selling were old and established features of the investing world. But that hasn't stopped generations of economics schools from teaching it as fact, and economists from proposing and implementing policies based upon it. Other theories, like the Keynesian pump-priming notion, are likewise devoid of any empirical evidence that they're true, and regularly refuted by events, but they are all nonetheless clung to as a theological matter, with the same religious fervor as that of a born-again Christian clinging to his belief in salvation and ignoring any evidence to the contrary. The only difference between them is that the Christian still has some hope he might be right. The efficient market guy was proven wrong by the Tulip Bubble in 1637.

Economic leadership that doesn't know shit about the real world. I went to a high-end law school, and one of the things you notice going someplace like that is that the professors teaching you have never actually worked as lawyers (or for that matter, as anything else) -- that would be beneath them. They've been law school professors their entire working lives. You are being instructed in how the legal system works by people who have never actually worked within it, and whose contact with it is and always has been minimal or non-existent. And of course, law school professors get appointed to high-level government commissions and agencies and the courts, and bring that narrow perspective from this extraordinarily insulated ivory tower with them. Government and central bank economics works the same way too. Except, of course, for the guys that come over from Goldman Sachs. But that's a whole other story.

None of this need be fatal, however. There are certainly empirical economists and behavioral economists with better theories, that could do a better job; and human behavior need not be an impediment. Parlor magicians, grifters, television evangelists, bookies and many others have not only been accounting for it but successfully exploiting it for thousands of years. There's no reason government economists couldn't do the same. The problem is, as you point out, guys like Greenspan, who set in motion very large forces based on a religious belief in theories with no evidence to support them, and who are prepared to stand on those theories regardless of the evidence to the contrary.

Get rid of them and replace them with some real guys, and you're right. It might have a shot of working correctly, if you could keep the politicians from meddling too much.

[-] 1 points by penguento (362) 2 years ago

Interest rates are certainly a tool, and central bankers try to do exactly what you've said. But of course, there are dangers there too: get it wrong one way and you choke off needed investment. Get it wrong the other way and it has the same effect as too much money: the easy credit drives up inflation and encourages things like property bubbles. Once in a while they seem to get the mix right -- just enough money, interest rates about right -- and everything runs okay. Unfortunately, they seem to get it wrong far more often than right.

The problem is that the precise way that all of these things interact -- and in particular the effect that human psychology has on outcomes -- is poorly understood. No, even that's not true -- it's simply ignored. They pretend as though it doesn't happen. Most of the theoretical models are outdated to the point of being silly by doing this ignoring (the rational market theory, for example -- refuted by every speculative bubble for the last 400 years -- but still touted with a straight face by many economists). Few even acknowledge the changes to behavior that are known to occur when you do things like print too much money or raise interest rates or taxes, so they're inherently flawed in a very big way. So when I read that the central bankers are going to start tinkering with things again, I get nervous. It so rarely turns out well.

I agree on QE. It's a stupid solution that's either window-dressing from people who know it's stupid but want to look like they're doing something, or voodoo economics by dopes that don't understand how money works. I can't decide which.

[-] 0 points by penguento (362) 2 years ago

I'm not. Financiers having it both ways isn't the same as the Greek government and critics having it both ways. Banks are very commonly heavily pressured to "invest" in government bonds, because the governments need the money. And in Greece, the government leaned very, very hard indeed on Greek banks to do so and was more than happy to take any money that other banks were willing to invest in Greek bonds. And all of the various critics were silent for many years whilst this was happening.

Then, when Greece got to the point of not being able to pay back the money, there was a lot of self-righteous carrying-on about how banks had been irresponsible to lend Greece so much money. It's the Greeks who want it both ways -- lend me as much money as I want now, but let me blame it on you later when I get in over my head. And now that the banks are out of it, the Greek government wants the European Central Bank and the other EU countries to step into the void and continue to hand out many billions of euros with no strings attached.

I'll have a read of your article. Meanwhile, you're right -- if the government has a monopoly on currency production, it's in charge. But when it's using currency printing to get out of debt, inflation is the whole point of the exercise. You simply inflate away your entire debt by adding zeros to the currency notes until all those old debts become trivial to pay off. The limiting factor is how much inflation your own people can stand before there are riots in the street. That's what brought Hitler to power.

[-] 2 points by geo (2638) from Concord, NC 2 years ago

I'm not. Financiers having it both ways isn't the same as the Greek government and critics having it both ways. Banks are very commonly heavily pressured to "invest" in government bonds, because the governments need the money.

Spare me the sob story of banks having their arms twisted to make bad investments.....pleeeeeeeeeze. Maybe you can point to bona fide news articles that back this up.

[-] 0 points by penguento (362) 2 years ago

It was all over the news a few months back, and the arm-twisting is common knowledge in the banking industry. It's very easy to twist the arms of banks that you are the regulator for, and it's done all the time. The Greek finance minister actually threatened to sue some banks last year for daring to suggest that Greece might not be a top-notch credit risk. I'll see if I can dig up some articles for you.

Meanwhile, I'm not crying in my beer for those banks either. They -- particularly the non-Greek banks -- were voluntarily lending Greece money way past the point of prudence, because the Greeks were offering up some very high rates for sovereign debt. Everybody else saw the train wreck coming, but they were working on the clearly erroneous theory that Greece wouldn't dare default and that the other EU countries wouldn't let them. There's certainly plenty of stupidity to go around, and I have no problem at all in letting them take a bath for their part of it. They'll be more careful next time.

My point is not that the banks weren't stupid and greedy. Clearly some of them were. But the Greek government wasn't some rube getting taken advantage of by sharp operators. They knew exactly what they were doing, and they used every bit of leverage they had and played it out to the bitter end, and they absolutely maxed out that credit card. And then when the bill came due they bitched and moaned about how mean everyone was being to them. And that's basically what they're doing right now, because the EU won't give them more free money.

[-] 2 points by geo (2638) from Concord, NC 2 years ago

They -- particularly the non-Greek banks -- were voluntarily lending Greece money way past the point of prudence, because the Greeks were offering up some very high rates for sovereign debt.

It's the foreign banks, that I was referring to. No body twisted any arms and these banks created most of the problem debt wise for Greece.

[-] 0 points by penguento (362) 2 years ago

A weird sort of death embrace, that. Bankers lending billions of euros to somebody they knew was in way over their heads and about ready to collapse, but they couldn't resist because of the interest rates being offered; and the political leadership of a country borrowing the country into destitution because they just couldn't control themselves. A pretty pathetic statement about the quality of leadership and the quality of thinking on both sides. One might be forgiven for supposing that at that level there'd be better people, but obviously one would be wrong in so thinking.

[-] 1 points by geo (2638) from Concord, NC 2 years ago

Well said. It is the nature of the beast. Which is why both financial institutions and governments can not be trusted.

[-] 1 points by penguento (362) 2 years ago

On that we are most definitely agreed, my friend.

[-] -1 points by monetarist (40) 2 years ago

U don't get it. Sure some banks can hedge their risks of greek debt. But hedging does not make the risk disappear.it simply transfers it. So it will still be some bank of the other picking up the tab for the greek debacle. Sure bankers can still make money by betting against greeks, but for each such gainer thr will b a loser, and loser too would probably be a bank

[-] 1 points by geo (2638) from Concord, NC 2 years ago

In theory its a zero sum game, in practice we have learned that it is not. Corzine might be the poster child for this.

[-] 1 points by monetarist (40) 2 years ago

Corzine and MF global made huge losses. Also thats besides the point. We are talking abouut hegding here.

[-] 2 points by geo (2638) from Concord, NC 2 years ago

Thats exactly how they made the losses, through hedging....even if they didn't use customer funds.

[-] 0 points by monetarist (40) 2 years ago

Actually no. The word 'hedge' in 'Hedge Fund' is misleading. They don't necessarily hedge. Hedging, on the other hand, is an investment taken with the intention to offset potential losses.

[-] 2 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Good points, but there is another alternative. However, the US and other major countries, such as China, India and Russia would have to participate. That is, global bankruptcy organization, like Glass Steagall in the US, then, the creation of national banks to provide credit for economic development projects.

Greece and Argentina would create their own credit that would be supplemented from other nations which would participate in international development projects. One example would be a rail system that would bridge the Bering Strait where Siberia and Alaska meet, connecting Asia to North America. This system would, of course, be expanded, greatly integrating all of Europe and Asia with North America.

Such a network should also be extend south from the US to South America, as well as south from Europe and Asia to Africa.

A major part of this idea is to start recognizing physical development as real wealth, rather than money.

[-] 0 points by penguento (362) 2 years ago

Money's just a coupon that you exchange for something real. But it's only good if there's something to exchange it for. The problem with Greece is that they hand out more coupons than they have stuff to back them up.

There are already many international development funds and banks. The same problem arises, though. There's still only so much money, and if you want to lend money to the next guy, the last one has to pay back his loan, unless you've got both the money and inclination to just make donations to everybody. But there's a limit to that too.

Since commercial funding got cut off about a year ago, the other countries of the EU have lent the Greeks very nearly half a trillion euros, as well as providing assorted other relief. However, many of them are now getting tired of doing so, since their own people are the ones paying for it. Even supposing they or someone else is willing to kick in some more money, there still has to be an end of it at some point. The Greeks have no right to demand that other countries provide them with a permanent subsidy program of hundreds of millions of euros a year; and the other countries have neither the interest or the money to do so.

[-] 2 points by arturo (3169) from Shanghai, Shanghai 2 years ago

I don't know a lot about Greece, but I imagine a lot of their productive capacity has been sold off, like in the US. That needs to be rebuilt if they are going to have something to exchange.

Yes, there are international funds but I would think that most of those are predatory, like the world bank. I think those sorts of institutions have to be replaced by national banks that provide and exchange credit for development projects.

I think the fact that funding is "commercial" is a problem in itself, in that the private parties that own the funds have their own benefit primarily in mind. National banks would have the objective of promoting the general welfare.

I don't think you should think of the Greek problem in isolation, its really an international problem. What Greece is going through now, every country will go through eventually, if we don't set things straight.

[-] 0 points by penguento (362) 2 years ago

Their productive capacity hasn't been sold off, it never really existed. They've been trying to have a first-world lifestyle on a second-world economy. Greece is basically a small, poor agricultural nation, nowhere near equivalent to Germany or the Scandinavian countries. It doesn't have a lot of natural resources or a strong industrial base. Even its agriculture is heavily subsidized by the rest of the EU. Building a much bigger economic base would be a challenge, to say the least, particularly given the well-established Greek aversion to paying taxes and the fact that 40% of the economy and 1/3 of the workforce is government. The rest of the economy just can't support that.

The international funds aren't predatory, really -- they're funded by wealthier nations and are effectively non-profits. But, to get money, you have to obey a lot of rules (admittedly, some of them being stupid and counterproductive rules), because the goal is to make the financial support a limited thing, not a permanent subsidy. And, much of the money is loans, not grants (and has to be if you want money available to other countries), so you still have the repayment problem. But regardless of how you structured such a fund or where the money came from, you'd still have to have rules and criteria and you'd have to enforce them unless you wanted to become a permanent sugar daddy for irresponsible governments. And what the Greek government wants is free money without strings attached, and for some extended period of time.

I agree that it's an international problem, but I don't think there's an easy fix. And there certainly isn't the sort of ideal fix that the Greeks would like to see. Even if there was some massive infusion of money for some extended period, people would still have to change their behavior in fundamental ways: stop retiring at 50; start paying taxes faithfully; and get off the government sinecure and into productive employment. And the government would have to be willing to legislate and enforce these changes; and all this would be very painful to a lot of people.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Well, they would have to develop a productive economy then wouldn't they? It was the goal of FDR after WW2 to use the us manufacturing capacity to provide advanced equipment to underdeveloped nations around the world on credit. Of course this could involve a lot of training and management as well.

Once the equipment is installed in the economy, and the people are trained and managed in its operation, it would create value that would be paid back to the US, sustaining the productive jobs of our people. We would have to rebuild our own economy first.

[-] 1 points by penguento (362) 2 years ago

That would be the best outcome if it could be achieved. I read an article today offering a solution along these lines: a combination of very long-term loans and outright grants from other countries, with a view to a complete rebuilding of the Greek economy. It might work if you could get a lot of people on the same page, and if everybody was committed for the long haul.

[-] 1 points by arturo (3169) from Shanghai, Shanghai 2 years ago

Yes, that's what FDR wanted to do long ago, and I think its what we should be getting back to today.

You say it might work, but I think its the only thing that can work. The world's economic system will just keep collapsing back to the dark ages if we don't do something like this.

[-] 1 points by MattLHolck (16833) from San Diego, CA 2 years ago

then Greece would have to depend on their resources

[-] 2 points by DKAtoday (34876) from Coon Rapids, MN 2 years ago

That will be rough going. They really are not set-up to be self sufficient. They "must" import a lot of things. Maybe they could work something out with the African Nations - "they" are in a position to be self sufficient if they only bothered to look and cooperate with each other.

[-] 0 points by penguento (362) 2 years ago

Which is part of the problem with having their own -- badly devalued -- currency. Assuming foreign entities will even take it (try changing North Korean money at an airport or your bank, for example), the exchange rate will be ruinous, and everything imported from anywhere will be very, very, very expensive, including the basics needed to run the economy, like petroleum. That makes the whole situation just that much more difficult.

[-] 1 points by DKAtoday (34876) from Coon Rapids, MN 2 years ago

What they need do is explore a partnership. I am sure the Greeks have skills that they can barter with. I am sure the Africans could come up with a beneficial trade.

[-] 1 points by penguento (362) 2 years ago

Which up to now, they have not done. And that's the root of the problem.

[-] 1 points by MattLHolck (16833) from San Diego, CA 2 years ago

an island nation that trades ?

no way!

[Removed]