Category Archives: Debt

Indian Savings Grace

Capitalism, Debt, Economy, Inflation, Morality

I watched Indian Finance Minister P. Chidambaram’s interview, some months back, on the Charlie Rose Show. Mr. Rose scolded Chidambaram for his countrymen’s high savings rate, mouthing the Keynesian mantra about the need for non-stop spending so as to keep demand from falling. I recall thinking how morally bankrupt was Mr. Rose’s advocacy of micro-bankruptcy, in the face of the Indian minister’s savings grace.

I have been unable to locate the transcripts for the segment (help?), but in The Hindu (a newspaper), Mr. Chidambaram is quoted as proudly talking up the thing Keynesians shun: savings.

“See, our savings rate in the worst year was 30 percent. In the best year, was 36 percent of GDP. Pick any number between 30 and 36 for incremental capital output ratio, what economists call ICOR, is about 4. Our potential growth rate is about 8 percent.”

The above excerpt is from the Charlies-Rose interview mentioned. The minister did look flabbergast at Rose’s suggestion that savings were a bad thing, explaining ever-so politely that this was a tradition in India.

Rose had smiled patronizingly, as liberals like him do about ethnic exotica.

What Ever Happened To Debtor’s Jail?

Affirmative Action, Britain, Debt, Government, Justice, Law

Judge Rosemary Aquilina is hoping to suspend reality in Detroit with her gavel.

Aquilina is “an Ingham County Circuit judge,” who “ordered Friday that Detroit’s federal bankruptcy filing be withdrawn,” reports the Detroit News. “Aquilina said the Michigan Constitution prohibits actions that will lessen the pension benefits of public employees, including those in the City of Detroit.” (Imagine: The state’s constitution works against Michigan taxpayers.)

The Library of Economics and Liberty remarks that “Early English bankruptcy laws were designed to assist creditors in collecting the debtor’s assets, not to protect the debtor or discharge (forgive) his debts.”

This was the wise, ancient common law. The latter is not the concern of Wikipedia, when it talks about the “debtor declaring bankruptcy to obtain relief from debt,” which “is accomplished either through a discharge of the debt or through a restructuring of the debt.”

That the US even allows Chapter 9—“municipal bankruptcy; a federal mechanism for the resolution of municipal debts”—says a lot.

Governments should not be availed of the legal instruments meant to protect private-property owners. How about debtor’s jail for politicians who defraud taxpayers?

Perhaps Aquilina worries that the fat cats (Detroit’s political class) will obtain relief at the expense of the little guy (public-sector workers) to whom the politicians and the unions promised the world?

The sooner the oink sector is disabused of its delusions, the better.

Last week’s column introduced readers to the Colosseum of courtroom cretins. In a word, a dumbed down courtroom commentariat that is incapable of separating politicized constructs (racism) from facts admissible in a court of law.

Judge Rosemary Aquilina is another of this idiocracy’s many exhibits.

UPDATE II: The Evergreen State’s Profligate Oink Sector

Constitution, Crime, Debt, Democracy, Government, Law, Left-Liberalism And Progressivisim, Private Property, Taxation, The State

“The Evergreen State’s Profligate Oink Sector” is the current column, now on WND. An excerpt:

“By now, Americans with a modicum of cerebral alacrity have a sense of the attitude among Washington State Democrats toward the immutable right of the people to keep their earnings. You all witnessed the despicable Jim McDermott’s intimidating verbal assaults, leveled at conservative property owners, during the House committee hearing on the den of iniquity and vice that is the Internal Revenue Service. For what is the seeking of ‘tax-exempt status’ if not a plea, directed at our overlords who art in D.C., to keep more of what is rightfully ours?

What Edmund Burke said about the House of Commons in his day applies in spades to a House packed with the likes of Rep. Jim McDermott D-Wash. ‘Designed as a control for the people,’ the House has become a control ‘upon the people.’

And the trend extends to local governments, gone from which are the old-fashioned county governors, once devoted to low taxes and careful spending.

Here goes.

While trying to be neighborly, I made the mistake of being less than reverential about my property taxes in ‘The Evergreen State,’ and in particular, the 51.4 percent appropriated for ‘State and Local Schools.’

I was informed in high decibels that my husband and I, hardworking both, ought to thank our lucky stars for this valuable index—thousands paid per year toward ‘State and Local Schools’—for without it we’d be clueless about … the value of our home. (If anything, taxes distort market prices. But more about the curious fallacy of the benevolent property tax, as a price signal in the housing market, in a follow-up column.)

Yes, siree. The bad tempered diatribe then swerved to the plight of local law enforcement, who, my interlocutor alleged, were powerless to police a squatter camp in the North Bend vicinity, for lack of resources. Some believe that twice did a man from this homeless encampment invade a homestead in the community.

We fork over thousands in property taxes per annum, yet, as was being asserted, the police were without the necessary funds to fulfill the State’s only constitutional duty: protecting the people. Naturally, where the State fails to carry out its sacred duty, as is almost always the case, The Tenth Amendment to the United States Constitution instantiates the individual’s natural right to do exactly what the heroic homeowners did to safeguard life and property: hastened the intruder’s descent into hell.

Commensurate with the value this Washington-State locality places on limited authority and republican virtues—none at all—law enforcement is not even itemized in the property-tax bill issued.

The truth is that the lion’s share of our property taxes goes toward …

Read the complete column. “The Evergreen State’s Profligate Oink Sector” is now on WND.

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UPDATE I: The “wasteful monstrosity” discussed above was celebrated by the local newspaper’s intrepid reporters. It too is local in name only—for most “local newspapers” are corporately owned. In our case, the pabulum published weekly is by permission of The Seattle Times Co. When our local rag is not reporting on a theatre that will close, a cinema that is hiring, or a pizza place that’ll host “Raise the Dough for Seattle Children’s”—the newspaper simply parrots the partyline on everything. I know, because I line my parrot’s cage with its pages.

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UPDATE II (7/24): For more of an idea of the all-pervasive profligacy of the oink sector in my state, check out the “Seattle Parasite-To-Resident Ratio.”

The Fed Tapeworm Is ‘Tapering,’ Or So We’re Told

Debt, Economy, Federal Reserve Bank, Inflation

As if Quantitative Easing were not deceptive enough a term, now we have “tapering.”

The money mafia had been “easing” to the tune of $85 billion in monthly bond purchases. If they’ve admitted to this much, you can be sure it’s much more.

Now Federal Reserve watchers are suggesting that the Fed’s “$85 billion a month bond buying program” may be winding down to … “$75 billion a month.”

The consequence of Ben Bernanke’s non-stop monetary stimulus, of course, is a rise in prices, stocks included. Homes too. It should be obvious too that an increase in the price of an item is not the same as an appreciation in it value.