Time to Talk About the Buffett Rule

[Gregg]

There is a certain point where you know very well what you are asking for and can still wish for ... collapse

Are you SURE that is what you want? Not a very pretty picture, but I suppose it would take care of the sticky issue of the elderly living too long.

[Yossarian]

I've been watching a few episodes Doomsday Preppers so I'm ready.

[jp1]

While it is certainly possible that a collapse could result in something better rising from the ashes it's equally likely that something worse, possibly much worse, could fill the void after an uncontrolled collapse. One only has to look to German history not quite 100 years ago to see just how bad things could turn out after the collapse. Hopefully we'll never have to find out what would happen in the US after a collapse.

[bae]

While it is certainly possible that a collapse could result in something better rising from the ashes it's equally likely that something worse, possibly much worse, could fill the void after an uncontrolled collapse.

I think that the odds of a positive eventual outcome after a collapse are pretty darned low, if you look at history. Best to avoid.

A fellow once said, in a really decent speech:

You and I have a rendezvous with destiny.

We'll preserve for our children this, the last best hope of man on earth, or we'll sentence them to take the last step into a thousand years of darkness.

http://www.youtube.com/watch?v=qXBswFfh6AY

[Gregg]

I have to agree that fastidious, self-imposed austerity measures now are far preferable to attempting a phoenix impersonation later.

[creaker]

I have to agree that fastidious, self-imposed austerity measures now are far preferable to attempting a phoenix impersonation later.

That is assuming that self-imposed austerity measures aren't just a more controlled form of collapse - in an economic model dependent on growth, aren't austerity measures a move in the wrong direction?

[Gregg]

That is assuming that self-imposed austerity measures aren't just a more controlled form of collapse - in an economic model dependent on growth, aren't austerity measures a move in the wrong direction?

For starters we should probably consider broadening our economic base as opposed to a pure reduction. Some aspects of our economy (and our society) may benefit from lateral moves. Agriculture is king in my area and a prime example. We could begin a shift from global industrial ag to more localized producers and suppliers. Not a complete shift, but enough to make the base more stable. Subsidies that currently offer the most benefit to multi-national corporations could be shifted to some form of stimulus that would benefit smaller producers and companies and thus encourage a shift to a more local or regional model. Leaving environmental and health benefits out of it for now, the economic benefits would include more dollars remaining in local economies which should reduce the need for some federal programs allowing the budget to shrink. It would also support a wider job base which should remain more stable over time thereby reducing the need for federal unemployment assistance. In a way it would be a partial controlled collapse in one sector offset by growth in another.

[Yossarian]

in an economic model dependent on growth, aren't austerity measures a move in the wrong direction?

No. You seem to think government spending creates growth. Every dollar the govt spends is taken from somewhere else where it is likely doing more good. You can make a colorable claim that during certain short periods govt spending may provide a buffer of some kind, but only at the cost of reduced future growth.

[bae]

No. You seem to think government spending creates growth. Every dollar the govt spends is taken from somewhere else where it is likely doing more good.

I thought it was well known that it is more efficient to take a dollar from a citizen, run that dollar through half a dozen layers of administrative overhead, then spend it on Something Important, an to simply allow the citizen to spend the dollar directly.

I got dinged on an audit for an energy-assistance program one of my non-profits was administering for the State a few years ago. The average grant per client was about $200. I was allocating $7.00 per grant for our overhead, which is what it cost us according to my data. The State auditor told me that wasn't sustainable, and I'd have to start charging ~40% of the grant amount for overhead, or they'd have to take the program away and give it to someone else who could do a better job wasting money on handling fees...

[jp1]

Our economy isn't dependent on growth because of gov't spending. Our economy is dependent on growth for survival because of the way the money is created. Every dollar in existence was loaned into being by the federal reserve and has to be paid back with interest. Obviously that's not possible unless there's an ever increasing amount of dollars. If those dollars, along with hard work or natural resource utilization, are used to create something of value the system will continue to work, and grow. The alternative is bad debts getting written off and that money destroyed. Since the powers that be don't seem to want that to happen, because they and their bankster buddies are the ones holding the debt, we will continue to have the federal reserve creating more and more debt in the form of dollars so that the bad debt can be refinanced over and over until growth makes the debts payable. It's questionable whether that will work out given the vast vast amount of questionable debt that's already out there.