So you hear all this talk about the "debt crisis", that we need to increase the debt ceiling, that one side wants to make spending cuts, while the other side wants to mantain current spending. That one side wants to cut defensive spending while the other side wants to cut entitlement programs. The real debate, if you can believe it or not, is over how much government spending will increase, yes, increase for these upcoming years.
"The cuts being discussed are illusory and are not cuts from current amounts being spent, but cuts in prospective spending increases. This is akin to a family saving $100,000 in expenses by deciding not to buy a Lamborghini and instead getting a fully loaded Mercedes when really their budget dictates that they need to stick with their perfectly serviceable Honda." -Congressman Ron Paul.
So really what's going on is the government is still spending money, and not only spending it, but increasing the amount they are spending. But of course the media and our own president don't mention the fact that these are cuts based on future increased spending. Here is Obama failing to mention the fact that the cuts proposed in the debt ceiling plan are actually cuts from future spending increases.
http://www.cbsnews.com/video/watch/?id=7374215n&tag=mncol;lst;3
But that's the mainstream media for you. Good luck getting much truth from any mainstream media source. This is all a charade to make people think that they are actually working on fixing the debt crisis, when really they are just trying to spend more money.
The worst part is, it doesn't even need to be a crisis. We could easily fix our economy, given time and actual, sensical solutions.
"In reality, bringing our fiscal house into order is not that complicated or excruciatingly painful at all. If we simply kept spending at current levels, by their definition of cuts that would save nearly $400 billion in the next few years, versus the $25 billion the Budget Control Act claims to cut. It would only take us five years to cut $1 trillion in Washington math just by holding the line on spending. That is hardly austere or catastrophic." -Congressman Ron Paul
Please listen to this video for a complete breakdown of whats really going on with the economy. Ron Paul explains it much better than I do.
Plea: Don't let the media do your thinking for you.
Prediction: The U.S economy will collapse followed by a couple weeks of chaos. Then the government will announce a "wonderful" new solution to the problem. A worldwide currency equivilent to the Euro, called the Amero. The Amero will be equal to the Euro in all ways except it will be used in Canada, Mexico and the US. You will be able to trade it straight across for the Euro because they will both be part of a one world currency, issued by a one world bank, regulated by a one world government.
Thanks for this blog, Ben.
ReplyDeleteI hope you keep updating it. I have it bookmarked.
First, it surprises me that in our political discourse we just assume government spending is intrinsically a bad thing. It seems to me that paying for public services as a nation can be a good system.
But, more importantly, as someone who is obviously familiar with Ron Paul (who, by the way, is not a Senator), you should understand that the debt is created neither by spending increases or tax cuts. Debt is only created by borrowing and our entire monetary system is founded on borrowing from the Federal Reserve.
This being the case, why not simply nationalize the Federal Reserve (that is, let the U.S. print its own currency--interest free) and we could fund whatever public services we wanted without creating one dollar of debt.
My grandfather lived in Indonesia back in the '50's. They printed whatever money they needed. Inflation was so high that he had to trade in the markets everyday. He bought up food and rugs and other commodities every day before the markets closed because his money would be worthless the next day. He then sold the items the following day at that day's currency value. We don't want that in our country.
ReplyDeleteUnless an increase in money supply (printing money) is equal to or less than the increase in productivity in the private sector, inflation will rise.
ReplyDeleteZimbabwe is a modern example of what happens when you print money without increased productivity. Productivity can only come from the private sector. Government created jobs do not infuse fresh capital. They only recycle old because tax payers earned that money originally by producing something, then paid it to the government, which then paid it to materials and workers. It is like building furniture by not cutting and regrowing new trees. If the demand for more furniture grows and you have destroy old furniture to recycle it into new, you will never expand the furniture supply to meet the increasing demand. Government spending on infrastructure is the same thing. But in their case, the demand for more productivity and jobs is always growing because population is growing.
The government needs to get out of the way of the private sector because it is the only avenue to increasing productivity to meet the demands of increasing population and keep the printing of money from becoming inflationary.
With the current rate of "quantitative easing" or, the printing of TRILLIONS OF DOLLARS TO FUND ILLEGAL WARS, the United States will see hyperinflation within the very near future. The banks have taken complete control over the government (which has been a plan in the making for over 100 years), and they are slowly grinding their process into a one world government fascist police state. I completely agree with you that Ron Paul is the front runner to defeat Obama, but also that the game is rigged, and he will most likely be "eliminated", one way or another. But as has been famously said, "there will be one hundred men hacking at the branches of evil, while only one striking the root.". Ending the Fed must be the FIRST objective of the new President if we wish to get America back, and Ron Paul seems to be the only one with the "balls" to do it. Great posts
ReplyDeleteWell, whether the wars are illegal or not have nothing to do with inflation. And whether or not money is spent on illegal or legal wars has nothing to do with inflation. That is purely political and frankly is a drop in the bucket compared to social security, medicare and medicaid.
ReplyDeleteInflation is very simple unless productivity (goods and services) is increased by private sector activity to match population growth, then people will on average be poorer. Same amount of stuff spread over more people. And unless goods and services increase to back money that is printed, you will have more dollars with the same amount of stuff out there. The dollar is subject to the laws of supply and demand so if you have more dollars and less stuff, the stuff is worth more and the dollars are worth less.
The real trick is to motivate people to go out and innovate, invent, give them incentives to start businesses that provide goods and services. Government can't do this directly but they don't have to. Americans already want to. All government has to do is have less intrusive regulations and keep the tax rate low. Prosperity will happen if people have the road blocks removed and believe they can keep the money they earn. They begin to hire and spend and the economy takes off. This increases tax revenue and soon the government is in much better financial shape. Everything this administration is doing is causing a recovery to be difficult or impossible.