[Guest]

From what I can tell there are 4 really big problems facing the American economy (and by extension, the global economy):

1) America's massive spending and debt (about $128,500 per man, woman, and child), which drives the global economy.
2) America's petro-dollar vulnerability and the fiat currency of the USD
3) Peak oil, and the lack of viable alternatives to oil
4) The expansion of the military industrial complex, which drains funding from other areas eg education, health, and creates a feedback loop of bigger military-industrial complex--->more oil dependecy-----> bigger military-industrial complex---->more oil dependency etc.

Do these four problems summarise the economic mess that the USA is in, or are there other factors as well?

What policies would need to be instituted in order to effectively deal with and eliminate these problems?

[Oiltanker]

Don't forget the trade deficit. USA exports less than it imports. Your politicians and capitalists and your massmedia have sold out YOUR ECONOMY you see. Probably because of short term selfish reasons.

Some politicians talked against this insanity, it where considered right wing, buchanan did it.

[Oiltanker]

"how do we get of out this mess"

Since all of this are symptoms of a sick society, a brainwashed society, my suggestion is to completely wipe out your mass media and the people behind it, wipe out the opportunist politicians, -just hang them, and you should also hang capitalists who have sold out your property, then you’re building a new house, with fewer expenses... you conserve energy, you segregate Americas population, - less criminality, less dysgenics, and more happiness.

With the energy you conserve you try to build up a infrastructure with fusion ( if it works).....

You take back a gold reserve or make a silver one..

You decrease the population,, about 20 million for a country like USA, empty the cities...........

[Guest]

Yes, the trade deficit is also a big problem, and closely related to America's foreign debt problem. But the economic machinations used by the elite to make America able to go into massive the petro-dollar have a certain evil genius to them. Aren't there also some equally or more clever ways to fix these problems by using economic maneuvering?

[Permanently_Baffled]

The problem is that all the "fixes" are political extremely painful. As I understand it half of the US trade deficit is imported oil. A gas tax would reduce consumption and the defecit but this would be political suicide.

Raising interest rates would strengthen the dollar and reduce domestic consumption (hence lowering the deficit), but this would lead to recession , higher unemployment and lower tax receipts for the government. So one deficit improves the other worsens!

Tax rises could help with both trade deficit and government deficit by raising more revenues and cutting consumption of foreign goods. Again this is unpopular and could cause a recession. So the balance has to be found.

Barriers to trade: America could add tariffs to imported goods to promote consumption of domestic products. Problem is this would lead to retaliation from other countries, this would also lead to inflation and domestic inefficiency as firms are shielded from competition. Also a lot of these products are essential, ie oil?, gas?....

Everyone in America could take a 90% pay cut ( ) and therefore compete with Chinese manafacturing on cost hence reducing imports.

Thats it! , I am out of ideas! Any economists out there with any other suggestions.

Conclusion: YOU ARE SCREWED!! (and therefore so are we.......)

GOD BLESS AMERICA !

PB

[holmes]

you forgot one other little nasty problem. millions of fantasy island faith based humanoids. These are the types that dismiss darwin and evolution. saying that an imaginary man created the universe.
These folks will be running around like chickens with their head cut off. i would say there are about millions of them.

and i will say they will run this country into the ground as much as they can until comlete blow out. Cuz to them nothing runs out.

kill them as soon as you get the chance once the shtf.

[Guest]

-just hang them, and you should also hang capitalists

Errr, methinks the advocation of killing ppl is not within the policies for this service.

[Guest]

you forgot one other little nasty problem. millions of fantasy island faith based humanoids.

Go look at the poster Jack - his 'tude is 'no way am I taking a drop in my standard of living'

Unless Jack has money to spend elsewhere, Jack's standard of living is gonna take a drop.

[holmes]

Standards of living WILL drop. No way around it. get ready to rumble. I have always lived a spartan lifestyle. I advise others to as well.
Lets get ready to RUMBLE brothers. The faith based have taken over and they will not give up the wheeel or the gas pettle.
and the neo libs want it just as bad. libertarians i dont think have shot in hell.
there is no way out. In fact i want it to go down becuase we have allowed the sinning lustfull greedy pigs to bancrupt the country and rape her and the fine people that do exist here. Those people are outnumbered 10 to 1. They say only 1 in 400 people in America understand basic ecology and evolution. the rest are humanoids grown in a synthetic make balieve overindustrialized test tube.

they will have to shot or you will die. get the picture?

[Kingcoal]

We're screwed. We've been screwed before, but this time we probably won't be saved by oil going down in price as was the case on several occasions in the last 30 or so years.

I think that the dollar will be allowed to become as toilet paper. That will produce an interesting situation. Americans will not be able to afford imported oil. Since North America is the world biggest customer for oil, this will cause the price to drop (as consumption falls.) That helps the rest of the world. If China hangs in there and lets their currency drag in the mud also, then Chinese goods worldwide will become even cheaper, especially for Europeans. Europe will be pushed into the position the US has occupied for the last 50 or so years. The EU will have to ramp up the printing presses to depress the Euro, or become a net importer. EU countries will have to make the switch, as the US has, to being a consumption entity or do something to prop up the dollar.

To sum up, the falling dollar is being used as a financial weapon. The US has no choice but to become an exporter once again - it has a lot of bills to pay. With the super cheap dollar, the US will make the EU sleep in the bed it made with the creation of the Euro.

I think the EU will respond to the falling dollar with trade restrictions in an effort to protect their producers. There will be a flood of ultra cheap imports from the US and China and other countries tied to the dollar. If this happens, the world will face a huge depression. There will be many complaints to the WTO, etc.

[Jack]

you forgot one other little nasty problem. millions of fantasy island faith based humanoids.

Go look at the poster Jack - his 'tude is 'no way am I taking a drop in my standard of living'

Unless Jack has money to spend elsewhere, Jack's standard of living is gonna take a drop.

Ahh, but Jack knows where to put his money so that he is making a profit from the situation. And, he's ruthless enough to use the necessary "human engineering" to get what he wants.

So no, Jack's standard of living is likely to continue to be a joy and a comfort - to him, anyway.

Thank you for your caring concern!

[Phil]

I agree with Holmes and Oiltanker.

[Guest]

What a load of psychobabble. Who was it that brought us capitalism and auto-bahns in the first place. The plantation owners, the el generales of the colonial world, Hitler - the flaming right wing.

Maoist China was largely agrarian. The Soviets had no private ownership - look at Cuba. It ain't puffing out billy all. I am still incredulous that you folks can be so blind.

Don't trust anyone, most of all the right wing and their mumbo talk!! All they do is hoodwink us with macho bs.

[Oilgood]

Now the Americans had to be pretty clever/cunning to get themselves into this mess, but surely there are some clever economic policies they can implement to get out of this mess? Can anyone think of anything? Or am I being overly optimistic? Yes, it does seem that any action to get out of this hole are not only going to be politically painful, but economically painful as well.

[0mar]

The US is a giant sink that is taking the entire global state with it.

There is no way to fix the US other than glassing the whole of North America. We are simply too consumerist, paranoid, anti-intellectual, and swayed by propaganda that there is no cure for our state. The best thing to do is ride out the crash.

[Guest]

I like the way the US is blaming the Euro
I remember when it was weak how they ridiculed it, now they are afraid of it

Kingcoal said that the Europeans made their own bed now they must lay in it
What?

For creating a stable currency that isn't loaded with debt?
People WANT the Euro because they trust it
They don't want the dollar because its not as good

Simple consumer capitalism - you buy the best don't you?

Ahh... but politics is what its about
The weak dollar will boost US exports and punish Europe at the same time

It's a suicidal risk of course, a backed into the corner long shot

If people pull out their dollar debt holdings or simply start using the Euro then the US economy will implode

Ahh ... but now its about fear and military strength

Who is going to do this when the US is so dangerous?

Its like playground bullying tactics
It WONT work

Do you think China or Russia care about the US?
They are just waiting for the right time, they know they will win

Meanwhile Europe is trying to create consensus and GENUINE friendships among nations, a powerful UN that everyone trusts

But the US rejects this, its not their brand of economy or politics
Theirs is selfish and how long, HOW LONG will the world prop up the American people's standard of living

Its an imbalance that can't go on
Yes, we are screwed. Im English and we are too
But if we keep sane we COULD ride this out and get a better world

Take a look at Bush and his politics. You won't be seeing it again, he's the last of his kind

The American people I feel sorry for, someone stole the American dream from them and sold it back to them as something else

Martin

[TheSupplyGuy]

I think another populist/progressive movement similar to the one 100 years ago could save us. If only we could manage to get a politician not tied to corporations in the white house or congress(ohter than John McCain), then maybe we could do something. The only way we got Theodore Roosevelt was that the corporate bought politicians put him as VP so he couldn't do any harm to them, and then McKinley got assassinated. In order for this country to save itself America has to do the following(I know its political suicide but this is from a reasoning perspective):
a. pass line-item veto for the president(to end pork spending by Congress)
b. make all senators, governors, representatives, and the president take a perk and pay cut(Mark Sanford voluntarily cut out all of his perks to help fix South Carolina's budget)
c. Make an amendment requiring a balanced budget except in times of war(but not including the war on terror, only when we've actually declared war on a country)
d. Find some way to eliminate Social Security for those under 50 and eliminate the system all together within 30 years.
e. Reduce health care costs by changing the laws of how people can sue.
f. Legalize marijuana and put a tax on it.
g. Begin a crash conservation program on gas and electricity, leading eventually into an alt energy program.
h. Hope the dollar will be worthless enough to cure the trade imbalance.

[GrimReaper]

I think the Supply Guy is a total fool, lacking even basic brain power. What else could one expect from someone from GA?

[pea-jay]

a. pass line-item veto for the president(to end pork spending by Congress)

It's a start, but really wont amount to much. Besides, with thousands of lines of code, only the egregious stand out.

b. make all senators, governors, representatives, and the president take a perk and pay cut(Mark Sanford voluntarily cut out all of his perks to help fix South Carolina's budget)

not even a drop in the bucket...

c. Make an amendment requiring a balanced budget except in times of war(but not including the war on terror, only when we've actually declared war on a country).

1-Deficit spending in times of recession has positive economic effects when correctly directed.
2-Incurring a debt to finance a captal improvement project can result in greater future finacial benefits than if the project was never completed.
3-Accruing surpluses is better utilized to pay past debts or to build a rany day fund than returned directly to the economy.

d. Find some way to eliminate Social Security for those under 50 and eliminate the system all together within 30 years.

Social security's problem is that it is a pyramid scheme. A combination of private accounts and government guarentees are required to make it safe and accessible to all. Getting to that point is difficult to impossible

e. Reduce health care costs by changing the laws of how people can sue.

Get real. The true reason behind the growing medical crisis is due the inability health care sector to respond to market forces that govern other industries. Healthcare faces massively inflexible demand curves, a large portion of the population making health decissions irrespctive of costs (since they are insured) while being forced to subsidize those who dont have insurance. The industry as a whole is clogged with paperwork inefficiencies due to all of the different companies, many of them trying to make a buck or two. I could go on and on. But the bottom line remains that malpractive remains a small component of this at best.

f. Legalize marijuana and put a tax on it.

Fun, but not real producive. Some possible finacial benefits maybe, but otherwise a "who cares" issue

g. Begin a crash conservation program on gas and electricity, leading eventually into an alt energy program.

Good idea, but too little too late

h. Hope the dollar will be worthless enough to cure the trade imbalance.

That will help out the rest of the countries a little

[gg3]

Jack says, speaking about himself in the third person, "And, he's ruthless enough to use the necessary "human engineering" to get what he wants."

Jack has thereby defined himself as fitting two of the key diagnostic criteria for adult antisocial personality disorder (disregard for others, and willingness to lie and manipulate for personal gain). In other words, Jack is a sociopath. Hey Jack, some day you're going to need other humans for something you can't buy with money, and they're not going to be there for you. And unless you change your ways, you're going to die loveless and miserable. He who dies with a lot of toys and no love, loses the most of all.

---

So, what to do to dig out the USA...?

First of all, encourage and support a culture of reason and responsibility.

Measures such as the line-item veto to enable de-porking of government budgets, may or may not have "truly significant" practical value, but they certainly send a message that the pork mentality is no longer acceptable, and pork will be chopped where it's found.

Put real teeth in the usury laws and apply them to consumer credit, notably credit card interest rates. This will have the effect of causing banks etc. to be much more selective in issuing consumer credit, thereby reducing both individual debt burdens *and* frivolous consumer spending. Both of these effects will in turn promote conservation and also strengthen the institution of our currency. (Slightly offtopic: To those religious extremists who say that marriage is the foundation of our society and gay marriage would destroy the institution, I say this: Money is the real foundation of our society, and usury is destroying the institution of our money by causing it to become worthless. Put your money where your mouth is.)

Immediate means-test for social security. Forget the enormous lie that it's a type of personal savings account. It's a tax and an entitlement, so treat it like one. Tax progressively and entitle progressively. Retirees with personal income above X in any given year get nothing, nada, zip, during that year.

Crash building program for 1,600 GW of nuclear fission, 400 GW of wind, and (as new tech makes it cost-effective), 400 to 800 GW of photovoltaic, with a 20-year timeline to completion. (We'll call this, "Gazillions of Gigawatts":-). Plenty of high-wage jobs to go around doing these projects. Streamline the approval process, and institute an "anti-NIMBY" clause that requires any juridsdiction that votes to oppose a power plant, to come up with equivalent power by other means or suffer power cuts when & as needed.

Crash program for efficiency upgrades, starting with transportation and buildings. Automobile mileage to increase such that average efficiency (CAFE rating) is 50 mpg within 20 years. Increase gas tax proportionally every year such that the cost of driving increases far less when efficiency increases are factored into the equation. Building retrofits to reduce need for heating and air conditioning; and any building that can't be retrofitted gets demolished and has its materials recycled for something new. (Say goodbye to all that floor-to-ceiling glass in office towers!) Massive deployment of high-bandwidth telecom to urban and suburban areas to enable move from physical-commuting to telecommuting.

Create a volunteer national sevice program for young adults to participate where relevant, e.g. running wind surveys and site surveys, clearing brush for transmission lines, insulating buildings, etc., and technical work depending on individual capabilities.

Major tax incentives for items in the preceding three paragraphs, including targeted reductions in capital gains taxes, and a "sweat equity capital" provision to enable individuals (usually in lower income levels) to obtain capital gains tax status for sweat-equity labor.

Now here I'll borrow two pages from the liberals, not just in a spirit of bipartisanship, but because they seem to be practical.

One, legalize pot and tax the hell out of it. Raise the tax on distilled spirits and nationally-distributed brands of beers and wines, to a level where marijuana becomes the preferred social relaxant.

Financial rationale: pot is an enormous cash crop with far more tax potential than patrickjford assumes. Go look at the numbers, they'll knock you over faster than a joint of powerful weed.

Social psych rationale: pot stimulates the reward mechanisms in the brain, thereby providing a substitute gratification to replace the pleasures formerly gained by high levels of consumer spending. In other words, it makes people sit around and enjoy staring at their belly-buttons rather than running off to the mall with their credit cards. Good, just what our society needs as it tries to cut back wasteful consumer orgies.

Two, steeply progressive income tax. As I said in another posting somewhere around here, beyond a certain level, increases in personal income become subject to the law of declining utility. At some point, additional increments of personal income produce zero additional increments of benefit (either personal or indirectly to society at-large).

This conclusion rather surprised me and led in turn to a logically necessary outcome: Figure out what the threshold levels are, and set up the tax structure to become 100% confiscatory of all income above the high end of that level, aside from whatever income is channeled to capital investment (and then tax the ROI in an approximately similar manner, thereby encouraging private charitable giving, which in turn enables reduction of government-based charitable entitlement programs).

However, capital gains tax breaks for investment in strategic industries, i.e. anything related to non-fossil energy production or efficiency measures. The combination of taxes and tax breaks will act to channel enormous funding into the relevant areas, thereby providing the capital for the "gazillions of gigawatts" construction plan above.

(More later, gotta go...)