Category Archives: Debt

Obamanomics: Me, My Minions & YOUR Money

Barack Obama, Debt, Economy, Government, Political Economy, Reason, Taxation, The State

“Obama: U.S. economy cannot afford [a government] shutdown.” Unless the government continues “making key investments in things like education, infrastructure [and] innovation,” we won’t “win the future.” [Transcripts]

This dyed-in-the-wool statist needs the aid of Lego or some sort of pop-up children’s model to figure out that dolling out unemployment benefits, state aid, and government jobs programs, all necessitate the seizure of private wealth through taxing, borrowing, and printing paper.

That cannot create wealth! The fact that some individuals will get wealthy or be “helped” leaves out the unseen; the overall poverty and misery he, his minions and their schemes create.

There is no big secret about “creating” jobs. Government can’t do it. Unless it sucks more capital and credit out of the private economy, it has only the capacity to consume wealth, not create it.

Here’s a simple, crude model for Obama the statist. Play with it with the First Girls. Recommend it to your Fabian friends, Mr. president:

Put 10 blocks in box A. Take 5 blocks out of box A and place them in box B. The owner of box A is 5 blocks poorer, the owner of box B is 5 blocks richer. Total number of blocks: still 10. Total blocks added (or wealth created): 0.

Come on BO, you can do it.

The best BO can do is take a hike; go on a 4-year vacation; walk the plank; just GET OUT OF THE WAY!

Interest Rates Mess With Time Preference Rates

Debt, Economy, Federal Reserve Bank

While crediting the “Fed’s interest-rate policies, together with other measures,” for having “helped avert a much deeper economic slump,” the War Street Journal is prepared to admit (here) that artificially keeping interest rates so low doesn’t “just hurt retirees. [It] also penalizes people of any age hoping to build up funds for the future, and discourage rainy-day savings that could make U.S. consumers more resilient to job losses and other financial jolts.”

Dah. Austrian economists have warned all along that the Fed’s policies will see the dollar drop like a stone, assets continue to devalue, and saving and retirement become near impossible. Prices will soar, and the currency will eventually collapse (hyperinflation).

“Americans who have done everything right, have worked hard, saved their money and stayed out of debt are the ones being punished by low interest rates.”

Time preference rates are the degree to which different people discount the future in favor of immediate gratification. In a credit-fueled, consumption-based economic culture, those who want it all now come out on top. The saver, investor or producer is not the type of economic actor that such a fiscal culture cultivates and rewards.

Defined By Debt

Barack Obama, Debt, Economy, Political Economy

By Sept. 30, the end of the fiscal year, reports the Washington Times, the debt will have increased by $2 trillion, to reach $15.476 trillion, thereby constituting 102.6 percent of GDP (admittedly an iffy measure of economic Brownian Motion/expenditure). The Panglossian among us will counter that we’ve been there before and recovered (World War II). However, arguably, the economic fundamentals today are worse than they were during the Great Depression, since this country has never before been so deeply in hock as it currently is. Debt-—micro and macro; public and private—is now one of America’s defining characteristic. By Vox Day’s account, “U.S. households, corporations and various levels of government” owe fifty three trillion dollars! (“The Return of the Great Depression.”)

More: “Federal deficit on track for a record this fiscal year
Government debt to exceed U.S. economy”

Oh, Barack Obama said something really stupid yesterday (for a change): If the federal government shuts down — it would have an “adverse effect” on the economic recovery.

Au contraire, Mr. President. It might be worth while paying this guy not to come to work.

Barack’s Budget

Barack Obama, Debt, Economy, Media, Uncategorized

The man with the revere-Midas touch has submitted his $3.7 trillion budget, which he, age-appropriately, justified before a suburban Baltimore middle school, this morning. Barack Obama’s definition of fiscal conservatism is guarding the status quo. Obama’s budget is the same budget as last year’s. The tax proposals are the same. Entitlements (Medicare, Medicaid, Social Security, and Defense) remain untouched, an exemption that included the new healthcare monstrosity. Discretionary spending Obama has vowed to freeze for five years at a very high rate, but, as Doug Holtz-Eakin, former Director of the Congressional Budget Office, reminded the Obama adoring Norah O’Donell, the president has a (short and savage) history of ferociously fighting the enforcement of the very freezes he proposes.

Holtz-Eakin: This budget is “a political documented oriented to getting him reelected. The American worker needs jobs. There is no greater threat to the economy than the accumulation of deb this budget promises. This budget is good political positioning,” which guarantees the continued issuance of debt at a rate of $50,000 a minute (the median income of the average American), or $12,000 per family.

With a flick of his forked tongue, Obama once beguiled media groupies such as MSNBC’s Norah O’Donnell. No longer. She seems persuaded by the warnings of former CBOaf to big spender President George W. Bush.