Deficits vs Stimulus and trade policy in troublesome economic times

[DZComposer]

This is more of a rant, but it should be a discussion-starter nonetheless.

I don't think you'll find anyone who disagrees with the notion that not spending more than you take in is a smart way to run things.

But what if we are in troubled waters?

Before I continue, I want to point out something: Governments are not like businesses. Deficits in business lead to failure. Most modern governments run on fiat currency, IE the money is backed by the full faith and credit of the government, not some commodity like precious metals.

That said, what is the sound thing to do in economic troubles?

The US is facing a pretty serious unemployment problem right now, and enough people think we should stop spending that relief efforts have been blocked in congress. Sadly, I do not think stimulus alone is going to get us out of this due to a globalized business mindset that chases after increased profits by importing cheap labor.

All though high school I heard about the "high-tech jobs of tomorrow." I loved computers then, and have followed IT to the point where I am getting a 4-year degree in it. But, the writing on the wall for these supposed "jobs of the future" is saying that most of them are going to India. There was a time where a programmer could make a lot of money in the US. I have talked to many skilled, and experienced, programmers who now have to work in retail or at McDonald's because their jobs either got outsourced or replaced by H1B visa holders.

Now, the "jobs of tomorrow" are green energy jobs. But, even this is already being trucked overseas. The number-one exporter of solar panels, for instance, is China. One US-based company that was founded to produce small wind turbines is manufacturing in Malaysia.

This trend was bad enough before the recession, and now I feel that we are going to face the real consequences of it as the service sector shrinks. Add to that concerns about the deficit, and the future looks pretty bleak for the low-skilled worker.

Well, now's a great time to go back to school and retrain, right? Climb up that social ladder! Well, going to college isn't easy. Not everyone is college material. It is also expensive. Even though Pell Grants have been expanded, they still don't cover tuition for most recipients (not to mention books, which can rival tuition in total cost), you still have to take out loans which cannot be discharged in bankruptcy. So, after 4-5 years of damn-near-broke living,you graduate with your BS in computer science to find that all the CS jobs went to India, and you have a $60,000+ loan to pay off with bleak employment aspects. You're gonna have to flip a lot of burgers or sell a lot of pairs of jeans to pay that off. That is if McDonald's and Abercrombe and Fitch aren't already overstaffed.

Hmm, the local elementary school is overcrowded and falling apart. Maybe you can work for the contractor who will build the new one. Nope. Education budgets needed to be slashed, so that school will need to last another 20 years. What about the old interstate highway bridge? They said on the news it could be the next I-35 collapse. Surely they are going to replace it. They will, but not until 2030. Or whenever it falls down. Whichever happens first.

The electrical grid needs modernization. Maybe you can get a job replacing transmission lines. After all, if they don't fix it, it's only a matter of time before New England loses power for a week again. Nope. No money for that either. We have a deficit, you know.

So, the jobs of tomorrow are being outsourced, the jobs of today are few, and there is no money being appropriated to do infrastructure work that is in bad need of being done.

The best way to recover the economy is to get money into the hands of people who will spend it rather than put it in a Swiss bank or hedge fund. IE, working people. Trickle-down economics has failed. The bailed-out banks still aren't lending. Jobs are still being cut, despite business tax cuts.

Perhaps it is time to revive the WPA. There are schools falling down, bridges that need repair, and a bunch of planned high-speed rail lines that are just paper drawings that need to be addressed among other things. This work needs to be done, and there are tons of people who need work to do. It doesn't take a genius to figure this one out. If there is work that needs to be done, and people that need work to do, let the people who need work do the work that needs to be done.

These people will have jobs, even if they only last a couple of years, they will earn money, and spend money, causing permanent businesses to grow, meaning they will start hiring, which creates opportunities for these workers once the projects are finished. That's what happened in the 30s, with WWII taking it to even greater heights as the work needed increased exponentially. This lead to over two decades of prosperity until an energy crisis and major policy changes happened. We also had tarriffs during this time which prevented outsourcing manufacturing en-masse.

So, can we please go back to what works? Once GDP starts rising, we'll pay off the extra debt. After WWII, the US debt was 120% of GDP. It is only about 80% now. And let's start protecting our workers again. We all deserve better.

[Guest DRL]

That is pretty much how my country

works, unfortunately - "the money is

better in the bank than invested" -

something that is most of the time

false.

To solve the current situation,

I favor:

1] Increasing mainteinance of

    infraestructure by hiring private

    companies, or when not possible,

    create a state-owned company to

    hire workers to do the job.

2] Improve the energy system. In some

    places, private ownership of energy has

    not proven as effective as in others.

    These could well be nationalized, issuing

    bonds for the former propietaries, then

    investing in how to improve these energy

    grids. (Grants to private companies could

    also work in some case, be either money

    or technology).

3] Increase the amount of state regulation in

    the market. Encourage states/provinces to trade between

    each other, rather than exporting to the highest

    bidder outside. This could improve the inner supply

    network.

4] Create national industries for the extraction of natural

    resources. Private enterprises should be left alone,

    but can also be invested in.

5] Favor the small bussiness over the big one in terms

    to funds & aid. Big bussiness should still recive aid

    if it needs to, preferibly in exchange of shares (the

    state owns the shares.) This would give the company

    additional money whilst increasing state reneuve afterwards.

["User"]

This was the primary topic of concern among world leaders at the G20 in Toronto, which concluded last weekend.  The goal of the G20 (which are the 20 most powerful countries economy wise) is for the heads of state to meet every now and then and discuss world related issues, but specifically the economic direction the world is heading.  Many things from how to pay down deficits to a possible bank tax to protect against future recessions were proposed and debated fiercely, with countries taking sides in the matter.  The United States was really the only country who was opposed to stopping stimulus funding since the situation there relative to other countries was more on a downside, despite all the other countries wanting to cut back on the spending or eliminate it completely. At the end of the summit most, if not all countries, set their own objectives for reducing their debt by certain years.  Some more realistically then others.  Another positive, from my opinion at least, is that the often debated bank tax would not be enforced on every country in the G20.  Rather, each country dedicates it's own policy when it comes to whether their own banks should be taxed.  He's a brief summary of the much dreaded (or desired) bank tax:

http://en.wikipedia.org/wiki/Bank_tax

http://rabble.ca/news/2010/06/bank-tax-and-g20-summit-overview

Basically, proponents of the bank tax argue that it is necessary to partially prevent future damage that will be caused if another global recession occurs. Opponents, mostly banks and countries that weathered the recession well by being responsible counter with the belief that they shouldn't have to possibility "bail out" other countries who can't get their shit in order financially, so a "to each his own" attitude.  My own view is that I'm in opposition to a bank tax.  I'll add on to some of DZ's points.

Before I continue, I want to point out something: Governments are not like businesses. Deficits in business lead to failure. Most modern governments run on fiat currency, IE the money is backed by the full faith and credit of the government, not some commodity like precious metals.

Which is why the price of gold and other commodities have skyrocketed in the last year or two, the initial concerns in Greece which spread to other EU countries has dragged down the Euro and investors scrambled to the "safe haven" of the U.S. (which I still don't understand from a economic standpoint why it's so "safe") 

The US is facing a pretty serious unemployment problem right now, and enough people think we should stop spending that relief efforts have been blocked in congress. Sadly, I do not think stimulus alone is going to get us out of this due to a globalized business mindset that chases after increased profits by importing cheap labor.

Some states have a really high unemployment rate, a friend of mine in Michigan said it's about 15% in his state.

All though high school I heard about the "high-tech jobs of tomorrow." I loved computers then, and have followed IT to the point where I am getting a 4-year degree in it. But, the writing on the wall for these supposed "jobs of the future" is saying that most of them are going to India. There was a time where a programmer could make a lot of money in the US. I have talked to many skilled, and experienced, programmers who now have to work in retail or at McDonald's because their jobs either got outsourced or replaced by H1B visa holders.

You and me both DZ, when I entered college in 2001 (same day as the 9/11 attacks actually) that was pretty much was the talk from my fellow I.T. students.  Computer jobs were playing big bucks.

Now, the "jobs of tomorrow" are green energy jobs. But, even this is already being trucked overseas. The number-one exporter of solar panels, for instance, is China. One US-based company that was founded to produce small wind turbines is manufacturing in Malaysia.

Countries are trying to jump all over that new "green market"...I know Canada is, but a lot of the technology isn't there or isn't practical yet.

This trend was bad enough before the recession, and now I feel that we are going to face the real consequences of it as the service sector shrinks. Add to that concerns about the deficit, and the future looks pretty bleak for the low-skilled worker.

Which is one reason why skilled workers today are upset that people who are unemployed could possibly be getting money they don't deserve from tax dollars under the current government - because they made no attempt to work for it.

Well, now's a great time to go back to school and retrain, right? Climb up that social ladder! Well, going to college isn't easy. Not everyone is college material. It is also expensive. Even though Pell Grants have been expanded, they still don't cover tuition for most recipients (not to mention books, which can rival tuition in total cost), you still have to take out loans which cannot be discharged in bankruptcy. So, after 4-5 years of damn-near-broke living,you graduate with your BS in computer science to find that all the CS jobs went to India, and you have a $60,000+ loan to pay off with bleak employment aspects. You're gonna have to flip a lot of burgers or sell a lot of pairs of jeans to pay that off. That is if McDonald's and Abercrombe and Fitch aren't already overstaffed.

Tuition fees are out of control nowadays >_>  There has been a growing trend recently as well for students to get into apprenticeships as well, they are still relatively high in demand and I don't know about the U.S. but Canada has a serious shortage of them right now.  Plus, our government is offering massive incentives for skilled workers who don't necessarily have a degree.

The best way to recover the economy is to get money into the hands of people who will spend it rather than put it in a Swiss bank or hedge fund. IE, working people. Trickle-down economics has failed. The bailed-out banks still aren't lending. Jobs are still being cut, despite business tax cuts.

I agree, American's right now are saving more money then they are spending - now that's not a bad thing but in order to stimulate the economy you can't be hoarding money, you need to spend it.

So, can we please go back to what works? Once GDP starts rising, we'll pay off the extra debt. After WWII, the US debt was 120% of GDP. It is only about 80% now. And let's start protecting our workers again. We all deserve better.

A large % of the U.S. debt is directly related to it's involvement in other wars.  The defense department takes up, by far, the highest budget in the American government.  I read in the news yesterday that the U.S. spends something like 7 billion dollars per month alone in Afghanistan fighting a war that has had limited success.  This may lead to another different topic but money right now shouldn't be spent fighting a war that doesn't look like it's ending anything soon...it should be spend on the economy. :/

[Guest Julius Quasar]

I don't think you'll find anyone who disagrees with the notion that not spending more than you take in is a smart way to run things.

Agreed.

But what if we are in troubled waters?

Before I continue, I want to point out something: Governments are not like businesses. Deficits in business lead to failure. Most modern governments run on fiat currency, IE the money is backed by the full faith and credit of the government, not some commodity like precious metals.

That said, what is the sound thing to do in economic troubles?

The US is facing a pretty serious unemployment problem right now, and enough people think we should stop spending that relief efforts have been blocked in congress. Sadly, I do not think stimulus alone is going to get us out of this due to a globalized business mindset that chases after increased profits by importing cheap labor.

Yup!

All though high school I heard about the "high-tech jobs of tomorrow." I loved computers then, and have followed IT to the point where I am getting a 4-year degree in it. But, the writing on the wall for these supposed "jobs of the future" is saying that most of them are going to India. There was a time where a programmer could make a lot of money in the US. I have talked to many skilled, and experienced, programmers who now have to work in retail or at McDonald's because their jobs either got outsourced or replaced by H1B visa holders.

Now, the "jobs of tomorrow" are green energy jobs. But, even this is already being trucked overseas. The number-one exporter of solar panels, for instance, is China. One US-based company that was founded to produce small wind turbines is manufacturing in Malaysia.

This trend was bad enough before the recession, and now I feel that we are going to face the real consequences of it as the service sector shrinks. Add to that concerns about the deficit, and the future looks pretty bleak for the low-skilled worker.

Tell me about it! *stands in the bread line*

Well, now's a great time to go back to school and retrain, right? Climb up that social ladder! Well, going to college isn't easy. Not everyone is college material. It is also expensive. Even though Pell Grants have been expanded, they still don't cover tuition for most recipients (not to mention books, which can rival tuition in total cost), you still have to take out loans which cannot be discharged in bankruptcy. So, after 4-5 years of damn-near-broke living,you graduate with your BS in computer science to find that all the CS jobs went to India, and you have a $60,000+ loan to pay off with bleak employment aspects. You're gonna have to flip a lot of burgers or sell a lot of pairs of jeans to pay that off. That is if McDonald's and Abercrombe and Fitch aren't already overstaffed.

I hear ya'...that's why I dropped out after my first year at community college. *breaks pencil in half*

Hmm, the local elementary school is overcrowded and falling apart. Maybe you can work for the contractor who will build the new one. Nope. Education budgets needed to be slashed, so that school will need to last another 20 years. What about the old interstate highway bridge? They said on the news it could be the next I-35 collapse. Surely they are going to replace it. They will, but not until 2030. Or whenever it falls down. Whichever happens first.

The electrical grid needs modernization. Maybe you can get a job replacing transmission lines. After all, if they don't fix it, it's only a matter of time before New England loses power for a week again. Nope. No money for that either. We have a deficit, you know.

So, the jobs of tomorrow are being outsourced, the jobs of today are few, and there is no money being appropriated to do infrastructure work that is in bad need of being done. 

^=Win

The best way to recover the economy is to get money into the hands of people who will spend it rather than put it in a Swiss bank or hedge fund. IE, working people. Trickle-down economics has failed. The bailed-out banks still aren't lending. Jobs are still being cut, despite business tax cuts.

Totally.  All my friends who worked for those corporate pigs lost their jobs, especially after the banks got bailed out.

Perhaps it is time to revive the WPA. There are schools falling down, bridges that need repair, and a bunch of planned high-speed rail lines that are just paper drawings that need to be addressed among other things. This work needs to be done, and there are tons of people who need work to do. It doesn't take a genius to figure this one out. If there is work that needs to be done, and people that need work to do, let the people who need work do the work that needs to be done.

These people will have jobs, even if they only last a couple of years, they will earn money, and spend money, causing permanent businesses to grow, meaning they will start hiring, which creates opportunities for these workers once the projects are finished. That's what happened in the 30s, with WWII taking it to even greater heights as the work needed increased exponentially. This lead to over two decades of prosperity until an energy crisis and major policy changes happened. We also had tarriffs during this time which prevented outsourcing manufacturing en-masse.

Yeah, just like FDR was doing.  He brought electricity to the South for the first time ever.

FDR: "The only thing we have to fear is fear itself."

Man: "...and spiders!"

FDR: "...well yes, and spiders, that goes without saying." 

So, can we please go back to what works? Once GDP starts rising, we'll pay off the extra debt. After WWII, the US debt was 120% of GDP. It is only about 80% now. And let's start protecting our workers again. We all deserve better.

Totally.  Though I'm sorry to say, it might not happen [anytime soon].

[Four-eyed Vulpine]

If I recall correctly, the U.S. national debt exceeded $13 trillion recently.

How can you even begin to pay that off?  I can't even comprehend that much money.

If I had $13 trillion and I had to spend it all before I die (say in 70 years), I would have to spend $5,885 per second for 70 years.

["User"]

If I recall correctly, the U.S. national debt exceeded $13 trillion recently.

88.9% of the current GDP yeah

How can you even begin to pay that off?  I can't even comprehend that much money.

I've stated a couple of ways already, but I didn't want to open a can of worms in this topic.

If I had $13 trillion and I had to spend it all before I die (say in 70 years), I would have to spend $5,885 per second for 70 years.

It's a staggering sum of money indeed.  :hehe:

[Guest Julius Quasar]

If I recall correctly, the U.S. national debt exceeded $13 trillion recently.

How can you even begin to pay that off?  I can't even comprehend that much money.

If I had $13 trillion and I had to spend it all before I die (say in 70 years), I would have to spend $5,885 per second for 70 years.

That's right, it is.

I dunno, I couldn't comprehend that amount either.

Really?  Wow....the damn bank bailouts are partly what did it...I think...

[Four-eyed Vulpine]

Another thing I don't quite understand is what currency and credit derivatives are exactly.

Seventh row down, second from the left.

I don't know what they are, but $620 trillion seems like an absolutely absurd number to me.

They have it rising at a rate of about $250,000 per second, too.

Not sure how accurate the clock is, though.

Edit:  Further calculations indicate that at the current rate, this will break one quadrillion (10¹⁵) dollars by the year 2059.

[Guest Julius Quasar]

Edit:  Further calculations indicate that at the current rate, this will break one quadrillion (10¹⁵) dollars by the year 2059.

Crap!

I'm sick of these buttmongrels in our government, running taxes up through the roof, and then limiting or eliminating all social services.  They wasted taxpayer money on "candy", and then demand more money to pay for "[liquor store] bread".

[Guest DRL]

Crap!

I'm sick of these buttmongrels in our government, running taxes up through the roof, and then limiting or eliminating all social services.  They wasted taxpayer money on "candy", and then demand more money to pay for "[liquor store] bread".

If I were the US, I would cut-off the

dan*ed war effort. The Cold War has

ended. It is time to move on to economics.

I am not saying "disband the military" or

anything like that, I am saying "use the

current funds wasted in those wars for

development". The war of Afghanistan

has been running BEFORE the fall of

the Soviet Union, and so far there is

no clear success coming for the next

years. So why not simply leave? Wasting

troops and resources in a useless war is

not the best way to spent your money.

[Guest Julius Quasar]

The amount of big corporations paying ANY taxes, in 1947 was less than 50%.  Today, it's even less than that.  Less than 10% of big corporations, today, pay taxes.  Nowadays, they give kickbacks and slush funds to greedy, incompetent asshole politicians to let them do what they want, be it export factory jobs to China (or Bangladesh), flood our nation with illegal immigrant slave labor, pollute and/or destroy the environment, and more...

The original American Politicians were put in place to be PUBLIC SERVANTS, but now they're just SELF-SERVANTS.  Puppets.  Lackies.  We originally put wealthy people in charge, because being rich, we figured that the ruling rich wouldn't be tempted too sell out to special interest bribery.  Boy were we wrong, especially today.  The top 3% ruling wealthy elite control 97% of all the wealth, jobs, money, power, and opportunities.  And why?  Because of the new Golden Rule: "Those who have the gold, make the rules.".  We joked about greed in the 1980's being a mass religion, worshiped by all.  But '80's greed is NOTHING compared to today's greed.

[Guest DRL]

The amount of big corporations paying ANY taxes, in 1947 was less than 50%.  Today, it's even less than that.  Less than 10% of big corporations, today, pay taxes.  Nowadays, they give kickbacks and slush funds to greedy, incompetent asshole politicians to let them do what they want, be it export factory jobs to China (or Bangladesh), flood our nation with illegal immigrant slave labor, pollute and/or destroy the environment, and more...

The original American Politicians were put in place to be PUBLIC SERVANTS, but now they're just SELF-SERVANTS.  Puppets.  Lackies.  We originally put wealthy people in charge, because being rich, we figured that the ruling rich wouldn't be tempted too sell out to special interest bribery.  Boy were we wrong, especially today.  The top 3% ruling wealthy elite control 97% of all the wealth, jobs, money, power, and opportunities.  And why?  Because of the new Golden Rule: "Those who have the gold, make the rules.".  We joked about greed in the 1980's being a mass religion, worshiped by all.  But '80's greed is NOTHING compared to today's greed.

Basically it is because of what I pointed out:

USA STILL BELIEVES in being the so-called

'World's Policeman'.

Basically wealthy people were put in charge because

they would obviously support Right Wing VS Left Wing;

however, if you look at Russia today, you see that it has

long ago abandoned the Cold War. The US continues to

think that a 'military buildup' is necesary - WRONG!

Nobody will fight now. There is China, yea, but they

have their spheres of influence long settled. China

WILL NOT fight the US simply because of the active

trade. And the US WILL NOT dare to attack China

simply because China has greater Air & Ground Forces,

while the US could only decisively control the seas.

But I am rambling again, let's get to the topic:

It is all about protecting free market capitalism. Basically,

the more you have, the less likely you will become a 'commie'.

To me, the 2-party system is long obsolete. Either it will become

a true Democracy (all parties) or it is slowly going to become

a corporate state.

[Guest Julius Quasar]

Basically it is because of what I pointed out:

USA STILL BELIEVES in being the so-called

'World's Policeman'.

Basically wealthy people were put in charge because

they would obviously support Right Wing VS Left Wing;

however, if you look at Russia today, you see that it has

long ago abandoned the Cold War. The US continues to

think that a 'military buildup' is necessary - WRONG!

Nobody will fight now. There is China, yea, but they

have their spheres of influence long settled. China

WILL NOT fight the US simply because of the active

trade. And the US WILL NOT dare to attack China

simply because China has greater Air & Ground Forces,

while the US could only decisively control the seas.

Ugh! NO! 

I'm so sick of foreigners talking about "America is trying to police the world" or how "Evil and imperialist America is." 

America builds its military to protect itself, not to conquer the world.  Sure it gets misused by shifty leaders from time to time, for their own self aggrandisements, but that doesn't mean America or its military powers are bad.

You might hate America (or at least its "policies") but there are worse nations than America, with even more harmful policies (China, Russia, Venezuela, North Korea, Libya, Saudi Arabia, Afghanistan, Iran, etc.).  The Right Wing Americans are not to [exclusively] blame.

But I am rambling again, let's get to the topic:

It is all about protecting free market capitalism. Basically,

the more you have, the less likely you will become a 'commie'.

Yes, let's get back OT

Definitely about protecting capitalism, I agree...regarding capitalism, it's gone from "Friendly Competition" capitalism to "Monopoly" Capitalism.  These rich jerks wanna protect their Monopoly, and crush any [potential] competition.  Elected officials are puppets for the corporate giants/lobbyists now.

To me, the 2-party system is long obsolete. Either it will become

a true Democracy (all parties) or it is slowly going to become

a corporate state.

Too late!

[Guest DRL]

Yes, let's get back OT

Definitely about protecting capitalism, I agree...regarding capitalism, it's gone from "Friendly Competition" capitalism to "Monopoly" Capitalism.  These rich jerks wanna protect their Monopoly, and crush any [potential] competition.  Elected officials are puppets for the corporate giants/lobbyists now.

There is the problem. No longer is

'Health/Friendly competition' - is all

about protecting the interests of big

coporations. It did not surprise me

when I found out that George Bush

was the CEO of a large, multi-national

mining company. In practic, to him

the other mining companies are an

obstacle - thus, it is best to make policies

to protect 'his' company - regarless if

other companies go bankrupt in the process.

Too late!

Well, it will be sad if it comes to that. If the

US becomes a "Corporate-State" (where the

goverment is controled by 'shares' owned

by corporations).

[Guest Julius Quasar]

There is the problem. No longer is

'Health/Friendly competition' - is all

about protecting the interests of big

coporations. It did not surprise me

when I found out that George Bush

was the CEO of a large, multi-national

mining company. In practic, to him

the other mining companies are an

obstacle - thus, it is best to make policies

to protect 'his' company - regarless if

other companies go bankrupt in the process.

Obama's no better, but that's not the point...

Since the "Industrial Revolution", lotsa Elected Officials, right AND left, have played into the hands of the rich lobbyist interests.

Either the temptation was too great, or the interests approached them, and said "We'll put you in office, but you gotta play by OUR rules." and if any politician refuses this, they gotta go it alone, and risk losing the election.

Well, it will be sad if it comes to that. If the

US becomes a "Corporate-State" (where the

goverment is controled by 'shares' owned

by corporations).

Yeah...I agree.  To be honest, it hasn't taken full hold, their are still outposts, and pockets of resistance...who knows? 

Maybe in time we [Americans] could take back our nation someday.

General Pepper: "Katina is battling the enemy!  Will you help 'em out?"

"Affirmative, General!"

[Sableye]

I know this problem.

      National Debt increases 

          /                                Boost Economy      Militia (Job) and Economy Problems

  Buy stuff- Personal Wealth increases  /                                    |

  /                  ,-------------------------------------------------------- Goverment Issues

Gets Job- pay taxes--build stuff------------------------------------                  |

          |                                                                                    Against Terrorism

          |                                                                                Build                       

use resouces      Used for paychecks (Back to Job)          Buildings (Job)

          |         

refill on empty

      needs          _ Trash (Wasted resources) MAJORITY

(See buy stuff)  |

                          |

                          Recycle (Saved resources) MINORITY

Will explain more.

[Guest DRL]

Obama's no better, but that's not the point...

Since the "Industrial Revolution", lotsa Elected Officials, right AND left, have played into the hands of the rich lobbyist interests.

Either the temptation was too great, or the interests approached them, and said "We'll put you in office, but you gotta play by OUR rules." and if any politician refuses this, they gotta go it alone, and risk losing the election.

Agreed. The supposedly 'Far Left' in the UK

(Chartists, or Charlists, I do not remember

correctly their name) happened to do this.

The industrialists bribed the 'elite' (middle-upper

class workers) that were the lead. Slowly the

party disolved that way, as the middle were

anarquists, and the middle-low communists.

Without the lead, the other two were too different

to co-existñ

Yeah...I agree.  To be honest, it hasn't taken full hold, their are still outposts, and pockets of resistance...who knows? 

Maybe in time we [Americans] could take back our nation someday.

General Pepper: "Katina is battling the enemy!  Will you help 'em out?"

"Affirmative, General!"

Well, as long as the coporates do not

make it official...

[DZComposer]

Another thing I don't quite understand is what currency and credit derivatives are exactly.

These are the engines of our economy right now (and they shouldn't be, as they were a major cause of the economic crisis).

A derivative is basically an insurance policy. Say I want to buy 3 million dollars worth of gold futures (a "future" is basically a promise to buy something at a specific price set NOW at a specific time, regardless of market value at that time). What if the gold I buy is worth less than 3 million at delivery? I'm screwed. But, I could, at the time of purchase, buy a financial product that pays me a certain amount, let's say 1.5 million, if gold prices go down by that date.  Because the payout of the product is derived from the value of something else, it is called a derivative.

So, the day comes to get my gold. My gold is worth 2.7 million dollars. Sad day, right? I just lost $300000, right? Nope! The derivative pays out, and I end up making a profit of over $1 million (fees, the buy-in price, etc reduce it).

Derivatives are nice because they can backstop you if you end up making a bad investment.

But, notice something about this: I made a profit of about $1000000 on what should have been a $300000 loss. The gold price would have had to astronomically rise for me to profit like that normally.

Well, you can make some serious cash on bad bets.

So, here is a good, better than I can do, explanation of how this led to greed, which let do bad things:

oosq3TPgHH0

More info on credit default swaps:

jHVnEBw93EA

[Guest Julius Quasar]

I know this problem.

      National Debt increases 

          /                                Boost Economy      Militia (Job) and Economy Problems

  Buy stuff- Personal Wealth increases  /                                    |

  /                  ,-------------------------------------------------------- Goverment Issues

Gets Job- pay taxes--build stuff------------------------------------                  |

          |                                                                                    Against Terrorism

          |                                                                                Build                       

use resouces      Used for paychecks (Back to Job)          Buildings (Job)

          |         

refill on empty

      needs          _ Trash (Wasted resources) MAJORITY

(See buy stuff)  |

                          |

                          Recycle (Saved resources) MINORITY

Will explain more.

Not bad, kid!

Agreed. The supposedly 'Far Left' in the UK

(Chartists, or Charlists, I do not remember

correctly their name) happened to do this.

The industrialists bribed the 'elite' (middle-upper

class workers) that were the lead. Slowly the

party disolved that way, as the middle were

anarquists, and the middle-low communists.

Without the lead, the other two were too different

to co-existñ

Good point!

Well, as long as the corporates do not

make it official...

Yeah,  Some of them do, but others don't, they wanna use the politicians and the government as "Lightning Rods", or Scapegoats.

[Kursed]

This is more of a rant, but it should be a discussion-starter nonetheless.

I don't think you'll find anyone who disagrees with the notion that not spending more than you take in is a smart way to run things.

But what if we are in troubled waters?

Before I continue, I want to point out something: Governments are not like businesses. Deficits in business lead to failure. Most modern governments run on fiat currency, IE the money is backed by the full faith and credit of the government, not some commodity like precious metals.

That said, what is the sound thing to do in economic troubles?

The US is facing a pretty serious unemployment problem right now, and enough people think we should stop spending that relief efforts have been blocked in congress. Sadly, I do not think stimulus alone is going to get us out of this due to a globalized business mindset that chases after increased profits by importing cheap labor.

All though high school I heard about the "high-tech jobs of tomorrow." I loved computers then, and have followed IT to the point where I am getting a 4-year degree in it. But, the writing on the wall for these supposed "jobs of the future" is saying that most of them are going to India. There was a time where a programmer could make a lot of money in the US. I have talked to many skilled, and experienced, programmers who now have to work in retail or at McDonald's because their jobs either got outsourced or replaced by H1B visa holders.

Now, the "jobs of tomorrow" are green energy jobs. But, even this is already being trucked overseas. The number-one exporter of solar panels, for instance, is China. One US-based company that was founded to produce small wind turbines is manufacturing in Malaysia.

This trend was bad enough before the recession, and now I feel that we are going to face the real consequences of it as the service sector shrinks. Add to that concerns about the deficit, and the future looks pretty bleak for the low-skilled worker.

Well, now's a great time to go back to school and retrain, right? Climb up that social ladder! Well, going to college isn't easy. Not everyone is college material. It is also expensive. Even though Pell Grants have been expanded, they still don't cover tuition for most recipients (not to mention books, which can rival tuition in total cost), you still have to take out loans which cannot be discharged in bankruptcy. So, after 4-5 years of damn-near-broke living,you graduate with your BS in computer science to find that all the CS jobs went to India, and you have a $60,000+ loan to pay off with bleak employment aspects. You're gonna have to flip a lot of burgers or sell a lot of pairs of jeans to pay that off. That is if McDonald's and Abercrombe and Fitch aren't already overstaffed.

Hmm, the local elementary school is overcrowded and falling apart. Maybe you can work for the contractor who will build the new one. Nope. Education budgets needed to be slashed, so that school will need to last another 20 years. What about the old interstate highway bridge? They said on the news it could be the next I-35 collapse. Surely they are going to replace it. They will, but not until 2030. Or whenever it falls down. Whichever happens first.

The electrical grid needs modernization. Maybe you can get a job replacing transmission lines. After all, if they don't fix it, it's only a matter of time before New England loses power for a week again. Nope. No money for that either. We have a deficit, you know.

So, the jobs of tomorrow are being outsourced, the jobs of today are few, and there is no money being appropriated to do infrastructure work that is in bad need of being done.

The best way to recover the economy is to get money into the hands of people who will spend it rather than put it in a Swiss bank or hedge fund. IE, working people. Trickle-down economics has failed. The bailed-out banks still aren't lending. Jobs are still being cut, despite business tax cuts.

Perhaps it is time to revive the WPA. There are schools falling down, bridges that need repair, and a bunch of planned high-speed rail lines that are just paper drawings that need to be addressed among other things. This work needs to be done, and there are tons of people who need work to do. It doesn't take a genius to figure this one out. If there is work that needs to be done, and people that need work to do, let the people who need work do the work that needs to be done.

These people will have jobs, even if they only last a couple of years, they will earn money, and spend money, causing permanent businesses to grow, meaning they will start hiring, which creates opportunities for these workers once the projects are finished. That's what happened in the 30s, with WWII taking it to even greater heights as the work needed increased exponentially. This lead to over two decades of prosperity until an energy crisis and major policy changes happened. We also had tarriffs during this time which prevented outsourcing manufacturing en-masse.

So, can we please go back to what works? Once GDP starts rising, we'll pay off the extra debt. After WWII, the US debt was 120% of GDP. It is only about 80% now. And let's start protecting our workers again. We all deserve better.

Perhaps if we could stop moving all of our damn local stuff to  so called cheaper making locations we'd be better off  ,but noo  does shippping major industies to china  so they can make these products off of child labor for underwage prices really fix anything and ontop of that instead of shipping around the nation  oh now we ship across the wordl Shipping charges people HELLO?!

Is it still cheaper to  make things through unerwaged child labor + the shipping cost

Alka seser  use to be made right here in america  as well as Bayer asprin ,but no longer now it's made in mexico  which on top of that has been stereotyped as  dirty mexico wow good job on that one.

[Guest Julius Quasar]

Perhaps if we could stop moving all of our damn local stuff to  so called cheaper making locations we'd be better off  ,but noo  does shippping major industies to china  so they can make these products off of child labor for underwage prices really fix anything and ontop of that instead of shipping around the nation  oh now we ship across the wordl Shipping charges people HELLO?!

Is it still cheaper to  make things through unerwaged child labor + the shipping cost

Alka seser  use to be made right here in america  as well as Bayer asprin ,but no longer now it's made in mexico  which on top of that has been stereotyped as  dirty mexico wow good job on that one.

Totally!

I'm sick of this nation losing jobs to outsourcing, and illegal immigrant in sourcing...

[Four-eyed Vulpine]

DZ, your explanation and links clear things up a lot for me.  I appreciate it.

[DZComposer]

Totally!

I'm sick of this nation losing jobs to outsourcing, and illegal immigrant in sourcing...

The outsourcing is hurting us a lot more than immigration. Immigrants generally take jobs that established residents do not want. It has been that way for 200 years. They brought Chinese over to build railroads back in the 1830s (all the way up to the 20th century, too), for instance. This was before there were machines that laid track. It was brutal, back-breaking, work to manually gauge and set the track. Do you know how many spikes there are in a mile of track? There can be up to 8 spikes per tie, and about 3,000 ties per mile. The transcontinental railroad was about 1700 miles. That's 5.1 million ties, up to 40 million spikes. That's an unimaginable amount of work to do by hand, but that's how it was done. I don't think very many middle-class people lined-up for that job.

Maids and janitors were Italian and Irish back in the late 1800s and early 1900s. Today, it's immigrants from Latin America.

It's just a lot easier to point the finger at people who look different and speak a different language than it is to point the finger at the CEOs of large corporations.

Cracking down on employers that hire illegal immigrants is a better policy than wasting money trying to track down individual workers. Unions help, too, as unions won't stand for the wage deflation caused by illegal immigrants.

[Kursed]

The outsourcing is hurting us a lot more than immigration.

It's just a lot easier to point the finger at people who look different and speak a different language than it is to point the finger at the CEOs of large corporations.

not to hard for me My dad had to change work places because of it.

but still I think that the stereotypes hurt too.

[Guest Julius Quasar]

The outsourcing is hurting us a lot more than immigration. Immigrants generally take jobs that established residents do not want. It has been that way for 200 years. They brought Chinese over to build railroads back in the 1830s (all the way up to the 20th century, too), for instance. This was before there were machines that laid track. It was brutal, back-breaking, work to manually gauge and set the track. Do you know how many spikes there are in a mile of track? There can be up to 8 spikes per tie, and about 3,000 ties per mile. The transcontinental railroad was about 1700 miles. That's 5.1 million ties, up to 40 million spikes. That's an unimaginable amount of work to do by hand, but that's how it was done. I don't think very many middle-class people lined-up for that job.

Maids and janitors were Italian and Irish back in the late 1800s and early 1900s. Today, it's immigrants from Latin America.

It's just a lot easier to point the finger at people who look different and speak a different language than it is to point the finger at the CEOs of large corporations.

I wasn't picking on immigrants.  I myself am half Chinese, and I understand the hardship and exploitation the Chinese railroad workers suffered through in the 1800's.

Cracking down on employers that hire illegal immigrants is a better policy than wasting money trying to track down individual workers. Unions help, too, as unions won't stand for the wage deflation caused by illegal immigrants.

THIS is what I was [mainly] talking about!