Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
It amazes me when people assume actions don't produce reactions. I wonder why no one else decided to impose tarrifs? Our leaders must not be as bright as you....huh? Obviously not. Look at the mess they got us in? You call that "bright"? Not only would prices rise through the roof, by imposing tarrifs, we would start a trade war. They have 1.5 billion people....or something like that. We salivate over that potential market, not to mention that if China retaliated by dumping the dollar our currency would likely crash......sooner than later.
We cannot be BOTH a high wage nation that produces what we consume.....plus have cheap prices. The cost of labor is passed down to the consumer in the form of higher prices. If we shift back all production to the US....there would be a radical increase in prices and our standard of living would decline. There is NO way to turn that does not involve a radical decrease in America's standard of living. Its a zero sum game. You can't have it both ways. If you want to buy cheap products and see production here continue to decrease, you have forfeited our prosperity to China.
If China un pegs the Yuan from the dollar prices will also rise tremendously in the US....having the same effect. Ignoring that, we have so much debt and unfunded liabilities that we will essentially be indentured citiezens simply working to pay down government and personal debt......which will leave little for new consumption, which will then result in decreased production and a downward cycle until an equilibrim price point of wages and standard of living is met. There are forces at work, economic, that is gradually equalizing the standard of living of nations. Which means that some nations will see a big increase in their standard of living (at least for some classes), like China, Brazil, India and the like, and other nations will see a big decrease in their standard of living, like the US, and many countries in Western Europe.
Too much emphasis is placed on "currency manipulation". The real problems are our government spending more than it can afford and American importing more than we export. If we had both of those under control, it wouldn't matter what China chose to do with their currency. Our government has been harping this currency manipulation B.S. because they are too arrogant or too stupid to realize that it is them that are the problem, not the Chinese.
Too much emphasis is placed on "currency manipulation". The real problems are our government spending more than it can afford and American importing more than we export. If we had both of those under control, it wouldn't matter what China chose to do with their currency. Our government has been harping this currency manipulation B.S. because they are too arrogant or too stupid to realize that it is them that are the problem, not the Chinese.
What do you think will happen if the government stops spending all the money it does? Every dollar spent is what......A DOLLAR EARNED! Hence, if the government radically decreases its spending......there is going to be a related radical reduction in earnings in this nation....leading to further production cuts and layoffs. You see, nearly all government spending is spent in America or on Americans. If you keep money in the hands of the taxpayer a lot of those dollars will be used to purchase goods made in other countries that employ other people. We are in a quagmire that is not escapable. There is no way to prevent a radical decline in this nations standard of living.
Again.....maybe you should not look at them being so dumb to get us into this mess....rather.....you should impressed at how slick they have been to keep the economy propped up for so long. The elites know that they have to prop up the economy or face a revolution from the people. Many people believed the HYPE of of American work ethic, ingenuity.....its special blessings from God and all that. The truth is that the US was simply in the right place at the right time as all the other major world economies were destroyed after WWII and many were crippled as WWI. This allowed the US to become the de facto economic monopoly and this nation became the words largest creditor and worlds largest net exporter and we shipped things around the globe and accounted for over 50% of global GDP in 1950. Well.....all those nations could not stay down in the dumps forever.....and when the recovered their industries and when China came on board with capitalism and INdia started its boom.......we were priced out of the competition. Nuff said.
What do you think will happen if the government stops spending all the money it does? We will eventually have a surplus budget and be able to pay off our debt. Every dollar spent is what......A DOLLAR EARNED! Every dollar spent that you don't have is one more dollar in debt that you become. Hence, if the government radically decreases its spending......there is going to be a related radical reduction in earnings in this nation Among government contracts, yes. But averall, the earnings will not be reduced. Money will migrate to other areas.....leading to further production cuts and layoffs. You see, nearly all government spending is spent in America or on Americans. But not on the Americans that are going to pay the bill. If you keep money in the hands of the taxpayer a lot of those dollars will be used to purchase goods made in other countries that employ other people. That is why we need a tariff. We are in a quagmire that is not escapable. With a tariff, it is. There is no way to prevent a radical decline in this nations standard of living. Except for a tariff.
Again.....maybe you should not look at them being so dumb to get us into this mess....rather.....you should impressed at how slick they have been to keep the economy propped up for so long. Slick?...the way a Ponzi Scheme creator is "slick"? The elites know that they have to prop up the economy or face a revolution from the people. Many people believed the HYPE of of American work ethic, ingenuity.....its special blessings from God and all that. The truth is that the US was simply in the right place at the right time as all the other major world economies were destroyed after WWII and many were crippled as WWI. This allowed the US to become the de facto economic monopoly and this nation became the words largest creditor and worlds largest net exporter and we shipped things around the globe and accounted for over 50% of global GDP in 1950. Well.....all those nations could not stay down in the dumps forever.....and when the recovered their industries and when China came on board with capitalism and INdia started its boom.......we were priced out of the competition. That is all quite true. Nuff said. No, that's not "nuff". As circumstances change, policy needs to be changed. In the late 1800's Great Britain embraced free market, because they believed they would always be the "top dog". At the same, the United States had a high tariff (half of the Federal government's revenue came from tariffs, the other half came from excise tax on tobacco and alcohol.) When the US became "top dog", they embraced free market while Asian countries practiced protectionism. Free market seems to make a lot of sense when you are on top, but it is in fact detrimental if it is not also fair. And when companies in foreign nations (or US companies with plants in foreign nations) are able to sell foreign made goods here that were not made in compliance with our laws (OSHA, labor, environmental, etc.), then we do not have a fair market.
Uhh.....no. If government radically reduces its spending then there will be a radical reduction in revenues and income comes from revenue. What do you think happens when government closes bases in states. The govenment may save some money initially, but it depresses the economies of the locations that the government radically cut spending. Those lost jobs mean that there will be no payroll income to tax for those individual. The little secret is that government spending creates income that it taxed and hence returned to the government. How can you create a surplus by cutting spending when cutting spending will also reduce jobs and revenue, meaning that the government safety net has to catch the fallen in the form of unemployment benefits, food stamps and others EXPENSES from the lost jobs that result from a contraction of government spending?
The only thing that is going to create a surplus is radically growing the economy and hence increasing revenue and increasing opportunity that reduces government transfer payments that increase during hard economic times. We cannot maintain our standard of living without increasing our level of debt. It takes more and more debt to maintain the economy......because its all a Ponzi scheme. The system is essentialy insolvent and debt is the only thing keeping it alive.....but eventually servicing the interest alone of the debt will reach such a level that it will eventually kill us too. There is no way out.
Uhh.....no. If government radically reduces its spending then there will be a radical reduction in revenues and income comes from revenue. What do you think happens when government closes bases in states. The govenment may save some money initially, but it depresses the economies of the locations that the government radically cut spending. Those lost jobs mean that there will be no payroll income to tax for those individual. The little secret is that government spending creates income that it taxed and hence returned to the government. How can you create a surplus by cutting spending when cutting spending will also reduce jobs and revenue, meaning that the government safety net has to catch the fallen in the form of unemployment benefits, food stamps and others EXPENSES from the lost jobs that result from a contraction of government spending?
The only thing that is going to create a surplus is radically growing the economy and hence increasing revenue and increasing opportunity that reduces government transfer payments that increase during hard economic times. We cannot maintain our standard of living without increasing our level of debt. It takes more and more debt to maintain the economy......because its all a Ponzi scheme. The system is essentialy insolvent and debt is the only thing keeping it alive.....but eventually servicing the interest alone of the debt will reach such a level that it will eventually kill us too. There is no way out.
I'm really enjoying your conversation. You both bring up great points. So, what do you think the lowering of our standard of living will look like? And how do you think it will come about? Lower wages across the board?
It may be interesting, but it has wandered far afield from the original post and intent.
Please drag it back, folks.
I think of it as thread maturity. Besides, Indentured Servant was the OP and he has done a commendable job of keeping the thread interesting as it develops, unlike many OPs who disappear and never respond. A little more enforcement of those types would do this site wonders.
Uhh.....no. If government radically reduces its spending then there will be a radical reduction in revenues and income comes from revenue....How do you figure? If you reduce your personal spending, how does that reduce your revenue and income? What do you think happens when government closes bases in states. They save a $$$$hitload of money. The govenment may save some money initially, but it depresses the economies of the locations that the government radically cut spending. Temporarily, that's true, but in the long run, spending and revenue seek new opportunities. When people stopped riding horses and buggies, they started driving cars. Elevator operators found other occupations. Economies evolve. Those lost jobs mean that there will be no payroll income to tax for those individual. The little secret is that government spending creates income that it taxed and hence returned to the government. "Little" "secret"? That's not a secret and it's not little. But it is not the best way for an economy to be set up. The government would make more revenue by encouraging the free market to develop. Why? Because the free market creates its own jobs and sustains itself, whereas the government has to constantly invent government jobs to keep the economy going. How can you create a surplus by cutting spending when cutting spending will also reduce jobs and revenue, Government jobs don't contribute to economic growth. The revenue collected by the government from the paychecks of government employees must be reimbursed (by definition) by the government. The revenue collected by private employees is "free" money for the government that does not have to be reimbursed...meaning that the government safety net has to catch the fallen in the form of unemployment benefits, food stamps and others EXPENSES from the lost jobs that result from a contraction of government spending? ...Those government workers will eventually find other jobs. True, if the government laid off a large percentage of the workforce all at once, it would create a big problem. But if the government imposed a hiring and wage freeze, and then a small reduction in workforce, the private sector would eventually absorb those employees.
The only thing that is going to create a surplus is radically growing the economy...or radically allowing the economy to grow, i.e. less regulation and taxation and a fair trade policy... and hence increasing revenue and increasing opportunity that reduces government transfer payments that increase during hard economic times. We cannot maintain our standard of living without increasing our level of debt....Not true. We can maintain and increase our standard of living by reducing our level of government debt, which will free up more money for use in the private sector, which will create jobs. A fair trade policy enforced with a tariff will also help the private sector. It takes more and more debt to maintain the economy...It takes more and more debt to maintain a socialist (or "Big Government", if the s-word offends you) economy, but a capitalist economy can run on very little government debt (or involvement of any sort. Or federal government was very small prior to FDR)...because its all a Ponzi scheme....True, much of the government's spending is. A Ponzi scheme is when you are paying benefits without the means to sustain those benefits due to decreasing revenue relative to benefits owed. So, as our population ages, we will be unable to sustain benefit payments to Social Security and Medicare/Medicaid recipients. As the size of the government grows, the private sector (which unlike the government sector, actually has the ability of growing the economy) will become increasingly unable to provide revenue to sustain the government and its benefit payments...The system is essentialy insolvent and debt is the only thing keeping it alive.. Not true. If you cut spending and revenue continues to come in, you can eventually get out of debt. However, the longer you wait the more difficult this can become. The US has known about this for decades, but we keep pushing it off...but eventually servicing the interest alone of the debt will reach such a level that it will eventually kill us too.That is very true. Fortunately, I think if we act soon, we can prevent this from happening. But if we wait another 5-10 years we will really be putting ourselves in a tough spot. It will depend a lot on when and how well the economy recovers. We lucked out in the Clinton years by having a long run period of growth. There is no way out. I think there is always a way out. It's just that some ways are easier than others. Fiscal responsibility, however late it may be in coming and however much we will all have to sacrifice, is much more preferable than us defaulting on our debt.
........
You might want to read up a bit on the fall of the USSR. Their economy was based on what you are proposing. Also the current problems in the socialist-tending economies of Europe would prove the shortcomings of your beliefs. Now if you want to understand what I'm talking about, look at China, a Communist country that has embraced capitalism. These countries will demonstrate that when jobs switch from private to government, the economy slows; when jobs switch from the government to private, the economy grows. (When you can't get your point across through theory, use real examples.)
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
