TCS Daily


Free Lunch Money

By Kristyn Birrell - February 15, 2008 12:00 AM

"Stimulus: something that incites or rouses to action; an incentive." Last week Congress approved a $168 billion economic stimulus package to help our slowing economy. One hundred and sixty-eight BILLION dollars -- a staggering amount to most of us, but only a drop in the bucket of our $14 trillion dollar economy.

At first glance, the bill looks like a great idea. Downturn in the economy, spending down, government to the rescue with rebates and tax breaks, more money to spend, spending up, economy back on top<right? Many of us can look forward to receiving a check in the mail in the coming months. While 'free money' is always nice, a bit of economic observation may temper our initial excitement.

Economic Lesson #1: There is no such thing as a free lunch. Milton Freidman may have passed on, but his economic teachings have not.

Children generally do not consider the origins of that $20 from Mom and Dad<it's just 'free money.' Assuming the money is rightfully the parents to give (i.e. it is not stolen), there are three possible sources: (1) Mom and Dad took the money from their wallet, thus, although the child's spending can increase, the parent's spending must decrease. (2) Mom and Dad borrowed the money from a third party, so their spending doesn't have to decrease in the short run. In the long run, however, Mom and Dad (or the child) will have to pay the money back, decreasing future consumption. (3) Mom and Dad are lucky enough to actually have a money tree in the backyard that grows money on command.

Those receiving stimulus checks are not children, so they should ask, "Where is this money coming from?" Economist Russ Roberts puts it best.

"The money has to come from somewhere. If you raise taxes to fund the plan, the people who are taxed are poorer and they'll spend less. If you borrow money to fund the plan, the people who buy the government bonds have less money to spend and that offsets the stimulus. It's like taking a bucket of water from the deep end of a pool and dumping it into the shallow end. Funny thing<the water in the shallow end doesn't get any deeper."

Of course, the government actually does have a money tree so they could just print more money. Increasing the money supply, however, causes inflation, and inflation makes the money we have worth less.

Economic Lesson #2: Incentives matter. Incentives incite action. What actions will the stimulus package spur?

Imagine parents who give each of their children $20. Do they all go out and spend it? Depending on the child's preferences, the child may spend all of the money, save all of it, or split the windfall between consumption and savings. Society as well exhibits various preferences and spending patterns.

A one-time increase like the stimulus check is more likely to be saved than a permanent increase, which explains their historically lackluster effect on energizing the economy.

Economic Lesson #3: Politicians often focus too much on the short run. The economic stimulus package is like giving children lollipops. The sugar may give them a short burst of energy, but they will soon crash. To ensure long-term energy and health, the children must be provided with a consistent nutritious diet. Real problems underlie our current slowdown, and real reform is necessary. Congress could better focus its energy on actions that provide long run productive incentives, like lowering both corporate and personal income taxes and economic deregulation in general.

Politicians, though, are elected in the short run not the long run. It's no wonder the economic stimulus package got such quick bipartisan support in an election year. Parents might give their children money with no ulterior motives, but Congress is not so altruistic. What were they really hoping to stimulate? Russ Roberts says, "Usually, the only thing that gets stimulated is a politician's approval rating."

Treasury Secretary Henry M. Paulson Jr. has declared the stimulus package "a gift to the middle class." Parents teach their children to be grateful and not assess the value of a gift, but this is one gift horse you may want to look in the mouth.

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71 Comments

What are you going to do with your "free money"?
My wife and I are saving to buy a house. Every penny of that check is going into savings.

Not what they claim to be hoping for...
Like you, I won't be making any big purchases -- I'll be paying down a credit card or making an extra mortgage payment.

Seems like everyone I've talked to about this is thinking the same thing -- here's some extra cash to help me get out of debt. (Of course, living in Austin, TX, the term most heard is "free money" -- right up there with "free healthcare" and "free education".)

Those receiving stimulus checks are not children
and THAT is the author's big assumptive mistake, if you ask me.

Hey Roy! The author was addressing you directly
"A one-time increase like the stimulus check is more likely to be saved than a permanent increase, which explains their historically lackluster effect on energizing the economy."

I've only been trying to drill that into your Keynesian head for weeks. But coming from me you think its some nefarious neo-con job or something. Instead, it is an economic fact of life that can not be ignored.

Russ Roberts says, "Usually, the only thing that gets stimulated is a politician's approval rating."

Ditto
Paying down debt. Most people I know are doing the same thing as well.

But just wait. Soon Roy will start spouting his class warfare kick on what zip codes we all live in -- as if that makes any difference.

What check?
I average 67 hours a week since I am self employed.

I don't get one, I don't deserve it.

Self-Fulfilling Prophecy
The article is pretty much spot-on. The economic "stimulus package" is simply a matter of political expedience, not practical economic solution. The notion that the American economy is on the verge of some sort of downturn has been touted enough by the media-at-large (whose job description entails them shouting "Danger!" not "No danger!") that the general populace -- stirred by the mortgage loan "crisis" -- has swallowed hook, line & sinker the notion that there is some inevitable economic recession in the works. After all, perception is political reality -- and if the perception among the masses (again, enabled by the dominant liberal media stirring the embers of discontent) is that the economoy is in decline, then they'll begin behaving as if the economy is in decline, thereby fueling the actual decline of that same economy. The self-fulfilling prophecy in action.

Thus, believing (and behaving) as though an economic downturn is inevitable, the general populace (gripped by a Mommy State mentality and sadly lacking in education on basic economics) reacts with a plaintive, "Dagnabbit -- somebody oughtta DO something about this lousy economy! Ain't there somebody in Washington who'll DO SOMETHING about this? What else are politicians FOR?" That cry for help is massively effective on politicians and embues them with a sense of purpose: No, not to actually provide some semblance of actual aid (the cyclical ups and downs in a dynamic market economy are inevitable -- leave it alone and it will right itself), but to leap into the political fray and present to those pleading masses the APPEARANCE of doing something. G.W. Bush knows that the so-called stimulus package legislation will do very, very little (if not actually nothing) to bolster the economy, but in order to appear as a caring, responsive President he realizes he at least has to give the appearance of hearing the fearful citizenry's complaints and providing some kind of aid. It's all a pragamtic political ploy; trying to explain to a (mostly) nervous populace that they should simply "ride out" any economic downturn when they're clamoring for some executive action is suicidal for a political party in an election cycle.

Arthur Laffer
There is a excellent OP-ED by Arthur Laffer about what a joke this rebate is.

I recommend it. In essence, robbing Peter to pay Paul. Net result, ZERO.


The author's understanding is half baked - here's the rest of the story
The politicians down in Washington are already spending on every boondoggle they can hide in an "omnibus" bill.

And they are already printing as many bonds as the Chinese government will buy at the current price/interest rate.

So - sending us all checks for a few hundred bucks each will only result in the printing of incrementally more bonds which will have to be sold to the Chinese since they are the only country stupid enough to buy our bonds and fund our profligacy. However, selling them more bonds will drive down the value of US bonds and the value of the dollar. Considering that the Chinese already own a huge pile of US Bonds and US dollars it is actually the Chinese who are paying us our checks.

Sometime in the future, of course, we'll have to devalue the dollar and default on the bonds - which is why we need a strong military, since the Chinese probably won't like that.

Chinese buying our bonds
We won't default on the bonds - that would lead to a collapse of our economy and our society. But if we get too deeply into debt the US government will have its current AAA credit rating lowered, the price of its bonds will go down and interest rates will go up. That would likely have a negative effect on economic growth in the US.

But most economists don't think the current deficits in the US are a big problem. As a percent of GDP they are not huge.

If the Democrats aren't able to make good on their threat to choke the economy with taxation and regulation we should be OK. I hope that our political system has enough partisanship and gridlock built into it to prevent that from happening. But given the miniscule rate of economic literacy among politicians and voters I can't help but worry.

Is it a big problem?
"But most economists don't think the current deficits in the US are a big problem. As a percent of GDP they are not huge."

Our debt is about 70% of GDP. GdP is about $14 trillion, debt is about $9 trillion. That seems like quite a big problem to me.

Once again, Bobjones' ignorance shines brightly on the tips of his typing fingers (all two of them)
There's a difference when speaking of 'deficits' vs total debt. And due to your ignorance of economics, you compare the two like you would apples and oranges just because some little thought process in the back of your head says, "Well, they both grow on trees, don't they?"

And furthermore, the US public debt-GDP ratio was 37% -- not 70% -- as of 2007. You couldn't even get that right since you further don't know the difference between gross government debt and public government debt. The public debt (that which America is on the hook for with other people) is only $5.1 trillion. The rest of the $4.1 trillion is what the government owes itself. That 'other' or intragovernmental debt is not issued nor traded to the public (that means the Chinese also), so it will have no bearing on any bond markets if the Feds just defaulted on those. Consequently, everyone from the Chinese to Morgan Stanley could care less about that. The intragovernmental debt is just book keeping entries, really.

As regards to the DEFICITS (pay attention, bob), they have been shrinking as a percentage of GDP and are at historical lows. Hence why "most economists don't think the current deficits in the US are a big problem".

But knowing you, you will either not understand any of the salient points I've just outlined to you or you will just ignore them as they violently discredit your Lou Dobbs' misguided populist world-view just as other economic realities have done so as evidenced on other posts.

gift to the middle class - phooey
We never got a gift during the tech wreck because politicians didn't pander to the stupid and greedy as much as today.

It's only a matter of time before the "gold bubble" bursts and our political-pandering class tries to buy off the remaining "overextended" victims who were subjected to "predatory" selling. What a bunch of krap.

Too many people in this country grew to adulthood without reading their operating manual. And now they whine about the consequences.

TS




A message for our time
This Russ Roberts fellow, whom no one has ever heard of, said it. So it must be true. Putting money into people's hamds has no positive effect on a consumer-based economy.

Instead, the way to keep the factory cogs turning is to propel money into the hands of the investor class. Then, when they finally collect it all, they will invest it wisely, leaving none to accrue in the pockets of the former working class. And then we can arrive at Pure Capitalism, without the necessity for purchasers. We can just produce pure goods, for all our virtual customers.

In fact your approach does have an odd symmetry. Whenever too much money goes into investment, and not enough into consumption, the money disappears. Look, for example, at the seven or eight trillion in carefully stored wealth that evaporated back in 2002. The system broke down because there were no more buyers. And all that stored value was lost.

So we just need to follow your Guru Russ. Starve the street, and the problem of excess wealth at the top will solve itself.

Huh?
Got it all figured out huh Roy? I this is nothing more than a transfer of wealth payment, it has a net sum gain of ZERO. A economy can not be founded solely on consumer buying.

Why stop at 600 bucks? I have it, why not buy everyone a house or car? That will boost the economy.

A chicken in every pot right?

You lack of economic understanding is profound. Your the ideal voter.

Busting the bubble of Class Envy or How I stopped worring about the Jones'
http://online.wsj.com/article/SB120286935977964221.html?mod=opinion_main_commentaries

roy can't get past his Marxist economy
A lot of people have made this point. That you've never heard it, is not surprising. You do have a tendency to stay unaware of things that don't fit into your theologies.

roy can't get past his illusion that buying is the only thing that matters, and that investors contribute nothing of value to the economy.

Once again...
"This Russ Roberts fellow, whom no one has ever heard of, said it. So it must be true. Putting money into people's hamds has no positive effect on a consumer-based economy."

No, Roy. Established evidence to the contrary of Keynesianism says so. Russ Roberts only refers to that, as have I.

"Then, when they finally collect it all, they will invest it wisely, leaving none to accrue in the pockets of the former working class. And then we can arrive at Pure Capitalism, without the necessity for purchasers. We can just produce pure goods, for all our virtual customers."

If that is what you believe, then no wonder you are among the economically confused. Don't worry, 99.999% of your fellow citizens are also.

And no, the 'stored value' was not lost. It was transferred to web developers and web sites devoted to Gumby, but not lost. Ditto with all past overinvestments in new industries (rail, electricity, autos, et al).

And the street doesn't starve if it has jobs. Jobs come from investors. No investors = no more new jobs. No more new jobs = no replacement of lost jobs or rising wages because the labor market demand for workers won't increase. THEN the 'street' starves. Big time.

You need to understand economic reality as it is, not how you wish it to be. Your approach reminds me of the little girl who doesn't take well to learning how ecosystems maintain balance just because she doesn't like watching the cute little bunny-wabbit get eaten by the wolf on Animal Planet.

Example: how did you know you wanted an iPod before some risk-taker provided it?
And said risk-taker took a big risk doing so. 99% of all the bright ideas out there don't pan out. But thank goodness about 4% of our population are willing to take those risks, or we'd be fighting sabre-tooths at the cave entrance still.

But those 'risk-takers' are taken for granted by the Roys of the world at best or used as vampiric blood-donors by the State that serves the Roy's of the world at worst.

I am glad you are here Z
Economics is not the strong suit of the liberal portion of this crowd and I have long ago tired of pointing out there faults in logic and reality.

Thank you for picking up the standard. Keep it up.

Public schools...
are too busy teaching children AGW and how evil US corporations are responsible for the world's ills to teach basic economics and personal finance.

Is it any wonder the government takes advantage of that stupidity?

You seem to be assuming that this ignorance is an unintended side affect of Public Education
I maintain that it is the primary purpose of it.

An educated populace would not be willing to accept the c**p that the teacher's union and other socialist organizations want to sell.

Education System Loyalties
>"Public schools are too busy teaching children AGW and how evil US corporations are responsible for the world's ills to teach basic economics and personal finance."

This is because the Public School systems are beholden to the (universally leftist) Teacher's Unions and to the concept of forwarding their collectivist agenda (and all the adjunct left/socialist ideological concerns).

That's why I favor a voucher system for public education: if socialistic mommies & daddies want to send their tykes to institutions where they can receive all the necessary collectivist/anti-capitalist/rabid environmentalist instruction they prefer (as is their prerogative), I'd at least like the opportunity to send mine to one where they can receive a contrary education which instills an understanding and appreciation of free market economics, the positive history of the United States, and the value of competition and individual achievement.

But that's a "pro-choice" stance the die-hard Left seems intent on squelching.

As Bill Clinton said
When discussing a tax cut in a speech to some business group. He stated that he really wanted to give a tax cut, but he was afraid that some people wouldn't spend the money wisely, and that this would hurt the economy.

Nannyology
>"he was afraid that some people wouldn't spend the money wisely...."

Which is to me exempliary of what I find most repulsive about the leftist mindset: the elitist notion that given individuals may be too stupid to behave in the "correct" way (i.e, behavior sanctioned by the collectivist Left ideology), and that they therefore should be MADE (via State coersion) to behave in "acceptable" ways. The idea of "looking out for the less fortunate" has innate totalitarian components when extrapolated to the concept of giving gov't the power to determine what constitutes abject fortune. As P.J. O'Rourke aptly put it, "I don't know what's good for you, you don't know what's good for me."

Further, while I concede that individuals may indeed sometimes engage in behavior (whether out of ignorance or will) that may manifest as contrary to their own material self-interest, I maintain that it's necessary that they retain the freedom to that behavior; the freedom to fail is a necessary correlary to the freedom to succeed -- indeed, without failure success has no meaning as a comparitive.

In short, just leave me the hell alone in matters over which I have control of my own fate. The inherent nannyism of the collectivist mindset is anathema to that sentiment.

Of course, for expressing that viewpoint I fully expect to be dragged over the coals as "uncaring" and
"unsympathetic" by the more left-leaning individuals who frequent these postings....

First things first, take a deep breath Zyndryl...
Thats it, slow down, relax a little bit, feel the tension leave your body as you exhale...

A guy can't even ask a question without a deranged right-wing idiot jumping on his back. And you guys think lefties are the emotional ones?


"There's a difference when speaking of 'deficits' vs total debt. And due to your ignorance of economics, you compare the two like you would apples and oranges just because some little thought process in the back of your head says, "Well, they both grow on trees, don't they?""

You can come up with a better insult than that. I think you got that one from your grandma. You must've been really spoiling for a fight to react like this to a benign comment/question as I posed.

Anyway, I stand corrected. I didn't realize when you use the word "deficits", it really means "budget deficits". I thought you use the word "budget" with it when thats what you're talking about. So I was referring to debt, not deficits. Our natioanl debt is 70% of GDP. Still, is that not a high number?

"And furthermore, the US public debt-GDP ratio was 37% -- not 70% -- as of 2007. You couldn't even get that right since you further don't know the difference between gross government debt and public government debt."

I know the difference. I'm just not as childish as you are in parsing the numbers to hit others over the head with. You're correct the debt held by the public is roughly 37% (its higher now).

"The rest of the $4.1 trillion is what the government owes itself."
"The intragovernmental debt is just book keeping entries, really."

Technically thats money the government owes citizens, or will owe citizens in the future. So no, its not "just book keeping entries, really". Its money the government is stealing from us. I never took you for a slimy politician type Zyndryl, I thought you prefer smaller government. Its very strange to see you make an argument for bigger government and acceptance of the idea government be allowed to take more of our money.

(Honestly, I still don't think you're a socialist. I think you wanted so bad to fight with me your mouth got out in front of your head on this one. These words probably get your blood boiling even more, it'll be interesting to see if your rational brain can take over and accept the fact of my point.)

I'm not as forgiving as you. I'm not happy to pay SS taxes only to have the government "borrow" that money for the general fund and face the prospect they'll never pay it back. I insist they pay it back, plus interest. I'm not satisfied they'll just try to raise the retirement age and reduce benefits to deal with the problem. Thats why I supported Bush's privatization scheme, bad as it was, it did take some of the money out of reach of government's sticky hands. And despite it would have caused deeper deficits now, adding to our growing debt.

"As regards to the DEFICITS (pay attention, bob), they have been shrinking as a percentage of GDP and are at historical lows. Hence why "most economists don't think the current deficits in the US are a big problem"."

You might want to reconsider that point. True, deficits have been decreasing the last few years, down to only $318 billion in 2005, the 3rd largest deficit in history by the way. But they are not at historical lows. Well, low compared to Reagan and HW Bush Administrations, but not historically. During the 12 years of those Admins, deficits averaged 4.3% of GDP. The total historical average is 1.2%, including the Great Depression and both world wars. Bush has averaged 2.7% from 2002 to 2006. I can't find final numbers for fy 2006 yet, but I see estimates of 2.3%.

Beyond that, the real problem with this is debt. A deficit isn't as serious when there isn't extreme debt. Unfortunately thats not our situation. We have big time debt and we're going deeper into debt as long as there is ANY deficit. You want to celebrate a decrease in our deficit, its down to around $300 billion a year. We currently pay more than $400 billion a year in just interest on our publicly held debt. What are you celebrating? Frankly, economists that think our current deficits are not a big problem are not very smart economists. Or they're ideological partisans. Which still makes them not very smart.

I'm surprised a second time by your post because of how firm you seem to be in the fold of the Bush message about the economy. The deficit to GDP ratios are most certainly not at historical lows. Unless of course you compare it only to other conservative Administrations. Compared to Reagan and Bush Sr., W is doing fine on this factor.

"But knowing you, you will either not understand any of the salient points I've just outlined to you or you will just ignore them as they violently discredit your Lou Dobbs' misguided populist world-view just as other economic realities have done so as evidenced on other posts."

Man, such a forked-tongue you have. I understand your points fine, you're simply wrong. I hope you can understand and accept that fact. Assuming you can't accept it, I look forward to your rebuttle of my points.

I think it is fair to label me with a populist view. I care foremost about the people of the country. And I like the message Lou Dobbs spouts, but he doesn't impress me. And I'm not an economics expert, but I'm happy to teach you about economics anytime, despite your arrogant and elitist insults. Oh boy, as upset as you were after I asked a question, I bet you're really fired up now. Take a deep breath, think it through.

You guys had a good echo going there. Sorry to end it.
"...I'd at least like the opportunity to send mine to one where they can receive a contrary education which instills an understanding and appreciation of free market economics, the positive history of the United States, and the value of competition and individual achievement."

Don't forget you want them to be instilled with abstinence-only, intelligent design and anti-gay views also.

You can't have the good without the bad. I agree with you on the values you espouse above, but its only part of the picture.

And what the heck is "the positive history of the United States"? As if only positive things have happened? Sounds pretty PC. Scratch that one, I prefer to teach kids about reality. Oops, there goes any semblence of conservatism.

Hahhahah
1) Nice red herrings, as usual.

2) "Technically thats money the government owes citizens, or will owe citizens in the future. So no, its not "just book keeping entries, really"."

No. You, the individual citizen, doesn't have any legal PROPERTY rights to SS or Medicare or any other entitlements as you would a bond or treasury bill the government sold to you. The Supreme Court has ruled thus so. Sorry to burst that little myth for you also.

And the Chinese bondholders don't care what happens to your SS as long as they get paid. If the politicians try to screw them over (default or hyperinflation or both), THEN they will be concerned.

3) You keep looking at absolute numbers. Sure, to you and I $400 billion is a lot of cash. Those numbers aren't important. Relative percentages are. That's why economists look at those. Especially when comparing historical trends. Tell me, isn't having a $300,000 mortgage excessively large by historical standards (even when you adjust for fixed-dollar values)? Sure it is. But then again, people are making more money and willing to go into more debt for their houses.

4)"And I'm not an economics expert, but I'm happy to teach you about economics anytime"

That's the problem (both of parts of your statement). More on that in my fifth point below. It is why I responded. Basically, you have demonstrated how to use economic buzzwords but a lack of understanding of what those buzzwords mean or what the concepts tied together in their usage are meant for. The unwary fall into your demagoguery.

5)"Oh boy, as upset as you were after I asked a question, I bet you're really fired up now. Take a deep breath, think it through."

You read too much emotion where it is not there. Email and forum postings are inherently emotionally toneless mediums, so we all 'fill in the blanks' and I am no exception. So, here is why I wrote what I wrote and why I wrote it the way I did: I wrote that not for you, per se. I consider you a lost cause, mostly. I wrote that to others who might be swayed by your economically inaccurate comments. Tezcatlipoca even so posted a 'high-five' for my efforts in response, which means that I at least did a decent job of making my rebuttal case even if people don't agree with it. That doesn't mean that I'll reach all the readers. Hell, I bet only a minority would take what I wrote and grasp it. Which means the vast majority are still on your side. Congrats!

Who let the NEA shill in here?
:)

Thanks, T
And I understand why you grew weary of it yourself. I'm starting to as well.

It's a thankless job -- except in the case of your posting. But if I realize that what I write jives with just one person reading it, then that will motivate me to keep it up.

You have to remember
that bob isn't interested in teaching us, nor does he believe he can learn anything from us.

He's just here for entertainment. The more turmoil he can cause, the happier he is.

You da man, Z.
I grew weary of doing what you're doing before I even showed up here.

But one advantage of this place is that the Boobie Jonesers are in the minority. Still a dangerous minority, given the pathetic state of economic literateness in the most economically powerful nation in the world, but a minority nonetheless.

Just keep telling it like it is, Z.

And that reminds me of another aphorism for robertbennet to pen down
Here we go:

"Being a Liberal is easier than being a potted plant or Terri Schiavo, whichever is more brain-dead."

And no, Great One, I bespeak not of you but of those you describe in the contents of your post.

Yup..that's why I answer the way I do
I alternate between the sharp tongue-lashing and just the silly, if I respond at all.

It also denies him the satisfaction of declaring a post 'ended'.

yeah, and?
If some slope headed, mono browed parent wants their precious little darlings to learn to recite the latest PC/ID/GW krap between x-box duels and pregnancies, that is their business. If they can find a school to teach it and don't stick me with the bill, so what.

Of course, the little darlings will probably be unemployable as demonstated by the various school boards becoming international laughing stocks for their religious fanatacism in pushing an ID agenda.

In a few years, we will have the same thing with global warming/climate change/death to polar bears blah blah. And Gore will be recognized as the uber-boob he is.

The condition of our country just reinforces my belief that if it wasn't for our society protecting the stupid and lazy from themselves, the Darwinian solution would manifest. The lower classes would kill themselves off before they could reproduce and vote liberals into office.

TS

Wow, that's pretty shallow
1. Abstinence-only - The Planned Parenthood folks are the only ones decrying the abstinence-based sex education. The fact is, it has about a par even success rate with wide-open sex ed. The right system is one that teaches abstinence primarily and explains the best birth control options as well as the reason to use protection (such as condoms). Whether they care to listen or not, abstinence is they only way to aviod STDs and unwanted pregnancies.

2. Intelligent design - I still don't get the resistance to teaching a reasonable alternative to Darwinist evolution. Again, it shouldn't be an either/or but a side-by-side. I'm not big on an single theory here (ID included), but I don't see the harm in teaching kids to think for themselves.

3. Anti-gay views - What the hel! is this??? Explain! I don't know of anyone teaching "Anti-gay" anything. I do know many who don't back a pro-gay agenda but they are generally neutral on the subject and leave it out of any subject matter.

4. Positive history of the United States - I prefer a more neutral history. The fact is the U.S. has been a net positive on the world, but that becomes evident when you look at our over all history.

Thats kinda weak
"You, the individual citizen, doesn't have any legal PROPERTY rights to SS or Medicare or any other entitlements as you would a bond or treasury bill the government sold to you. The Supreme Court has ruled thus so. Sorry to burst that little myth for you also"

What Court ruling are you referring to? I don't view SS as the same in terms of property rights as a bond or treasury bill. Bonds are legal contracts, entitlements are of the political game. I figured politicians would find a way eventually to convert SS to a different system, or outright default on the loans, or whatever. I believe I can do nothing about it, except express my displeasure at the deception and theft of our money. If the Court gives them backing its worse than I thought. We're being screwed, I'm surprised to see you not bat an eye at it Zyndryl. What ruling? How did they justify it...


Beyond that, your response here is to just dismiss my points as buzzwords and inaccurate. Whats inaccurate? I stated facts, statistical realities. You got an answer for that too, its "red herrings" and "absolute numbers". For some reason you think your information is the important information and mine is meaningless. But the unwary "fall into (my) demagoguery"... How is it we can look at the same thing and describe it so differently? Thing is, I don't want my view on economics to be far left, I want it to be based on truth, with a philosophy of moderate-right perspective. The truth is that economics is a complex thing, humans made it worse by inventing Wall Street, thus infecting markets with human emotion. Theories and ideology are only good for so long, we're still learning, circumstances are always changing.

I think the debt matters. Why do you so easily dismiss the national debt? Public debt alone is 37% of GDP. How much of the economy is going to have to be diverted to paying it off? The money has to come from somewhere.

You made a point that deficits-to-GDP are at historical lows. Thats simply not true, as I showed. The historical average is 1.2%. Clinton was under half of one percent (but thats because he was blessed with a great economy, not his own doing),

You strongly imply the intragovernmental debt of $5.1 trillion will never be paid whatsoever. That debt is also growing, its moving in the wrong direction. But at some point the expense for SS will exceed the revenue. Then what? Raise taxes or start paying back the debt...


I'll also point out a deceptive move you used.

Z: "And furthermore, the US public debt-GDP ratio was 37% -- not 70% -- as of 2007. You couldn't even get that right since you further don't know the difference between gross government debt and public government debt."

What I actually said is that "national debt is 70% of GDP". I was exactly correct. National debt includes public and intragovernmental debt. Was that just a mistake, or did you purposely twist it just to throw something back at me? Its very dishonest.

Thats kinda weak
"You, the individual citizen, doesn't have any legal PROPERTY rights to SS or Medicare or any other entitlements as you would a bond or treasury bill the government sold to you. The Supreme Court has ruled thus so. Sorry to burst that little myth for you also"

What Court ruling are you referring to? I don't view SS as the same in terms of property rights as a bond or treasury bill. Bonds are legal contracts, entitlements are of the political game. I figured politicians would find a way eventually to convert SS to a different system, or outright default on the loans, or whatever. I believe I can do nothing about it, except express my displeasure at the deception and theft of our money. If the Court gives them backing its worse than I thought. We're being screwed, I'm surprised to see you not bat an eye at it Zyndryl. What ruling? How did they justify it...


Beyond that, your response here is to just dismiss my points as buzzwords and inaccurate. Whats inaccurate? I stated facts, statistical realities. You got an answer for that too, its "red herrings" and "absolute numbers". For some reason you think your information is the important information and mine is meaningless. But the unwary "fall into (my) demagoguery"... How is it we can look at the same thing and describe it so differently? Thing is, I don't want my view on economics to be far left, I want it to be based on truth, with a philosophy of moderate-right perspective. The truth is that economics is a complex thing, humans made it worse by inventing Wall Street, thus infecting markets with human emotion. Theories and ideology are only good for so long, we're still learning, circumstances are always changing.

I think the debt matters. Why do you so easily dismiss the national debt? Public debt alone is 37% of GDP. How much of the economy is going to have to be diverted to paying it off? The money has to come from somewhere.

You made a point that deficits-to-GDP are at historical lows. Thats simply not true, as I showed. The historical average is 1.2%. Clinton was under half of one percent (but thats because he was blessed with a great economy, not his own doing),

You strongly imply the intragovernmental debt of $5.1 trillion will never be paid whatsoever. That debt is also growing, its moving in the wrong direction. But at some point the expense for SS will exceed the revenue. Then what? Raise taxes or start paying back the debt...


I'll also point out a deceptive move you used.

Z: "And furthermore, the US public debt-GDP ratio was 37% -- not 70% -- as of 2007. You couldn't even get that right since you further don't know the difference between gross government debt and public government debt."

What I actually said is that "national debt is 70% of GDP". I was exactly correct. National debt includes public and intragovernmental debt. Was that just a mistake, or did you purposely twist it just to throw something back at me? Its very dishonest.

Zyndryl's ignorance shines brightest
I am afraid that you are confused about the government debt Zyndryl. If the U.S. Government kept their books in the same manner as they require privet businesses the national debt would be over 40 trillion. What they are leaving out is outstanding obligations and promises. Little things like Social Security, Medicare, and Medicaid. I sure hope that you are not an about to be broke boomer! Haha! I recommend that you vist a website that goes into how the data reporting has changed, www.shadowstats.com the website was in an article in Forbs a few months back.

alternatives
Intelligent design is not an alternative to Darwin, it's a variant of Darwin.

Classical Darwin states that over time, incremental random changes result in evolution.

ID removes the word random.

Is ID unproveable. Yes.
Is classical Darwin unproveable. Yes.

Public School are Public Parents
I thought that I would jump in with my point of view on this topic...

Course material becomes problematic when schools teach anything other then basic skills like hygiene, arithmetic, Language, and science.

Currently the education system has the cookie cutter feel of a bionic parent. The real parents have little to do with raising their kids. They are too busy working for a living.

Schools should give children the skills to be a productive members of society. They should not be instilling them with standardized world views. I don’t think that this PC groupthink traing is a good idea. It may lead to a brave new world.


bob's religious faith in govt reminds me of roy's religious faith in scientists
At least in those scientists who are saying what he wants to hear.

Did you see our exchange regarding the quality of the surface station climate network. roy just declared that real scientists wouldn't allow the network to get as bad as Anthony Watt's survey was indicating. Therefore the network wasn't as bad, and the problem was that Anthony was cherry picking sites, monkeying with the data. Something. Anything.

He couldn't, wouldn't deal with reality, not when it conflicted with his religious convictions. So he started inventing wild excuses so that he could ignore what was in front of him.

bob is the same way, only with govt.

More Mindless Vindective
"Don't forget you want them to be instilled with abstinence-only, intelligent design and anti-gay views also." Is this what they teach in schools? Really, where? Quite the contrary, most liberal run big city schools teach the opposite all of which is the parents domain, not the schools. Anti-Gay? Geeeessh, yeah, that is a huge concern of mine. How about Math?

As to positive history, I think he was referring to the leftist attempts at revisionist history, such as, the Atomic Bombing of Japan. Thanksgiving?

How about the teaching of Global Warming as fact instead of the science of both sides?

As to reality, your just being plain silly. Since Conservatism is founded in individual rights, private property, free markets AND these ideals have proven to create the most prosperous and free people in history how exactly does that diverge from reality?
You have no idea what conservatism even is or what it stands for, how can you criticize that which you don't even understand?

Non-Science
Sorry Mark (since you and I are in agreement on so many other topics on these threads) -- ID is simply Creationism on steroids. Although garnished with an impressive sounding pseudo-scientific spiel, ultimately it is still reliant upon the same "Argument from Ignorance" or "God of the Gaps" philosophical approach. There is no science involved.

I recommend Godfrey & Petto's "Scientists Confront Intelligent Design and Creationism" for anyone actually interested in examining the scientific arguments of ID proponents.

Bob's Non-Echo
>"Don't forget you want them to be instilled with abstinence-only, intelligent design and anti-gay views also."

I and the scientific community the world over would be quite interested to know what mechanism of Extra Sensory Perception you possess which gives you the ability to enter my mind and extract a true knowledge of what I ACTUALLY want aside from what I STATED that I want -- that's some revolutionary power worthy of extensive research.

NOWHERE did I state in my post any reference to the things you extrapolate via your stereotyped view of my position as a political Rightist (and here I thought it was the political Left, in their morally superior dudgeon, that was opposed to the abomination that is stereotyping). But to address your specific points directly, it will no doubt shatter your view of my political self-characterization to digest that:

1) I am strictly opposed to the teaching of Intelligent Design in a public school Science cirriculum. ID is nothing more than Neo-Creationism, and if anything belongs in a Philosophy/Religion course. (I have posted previously my stance against ID, which you conveniently overlook in an attempt to broadbrush categorize.)

2) I am strictly opposed to the teaching of ANY "anti-gay views" (whatever such a cirriculum that might entail). Further, on this issue I am flatly out-of-step with many of my conservative brethren, as I'm also NOT opposed to the concept of gay marriage. (Please point out to me ANYWHERE on any of these threads where I've ever issued statements regarding sexual orientation whatsoever, if you please; it might lend some credibility to your otherwise spurious assertion.)

As for Abstinence Only teaching, I don't have any problem with instructing youngsters that abstinence is the only assured way of preventing both unwanted pregnancies and STD's. How viable that position is in today's world is a matter for another discussion. But to dismiss abstinence as a credible alternative to simply "being careful" strikes me as cynical and defeatist on the whole.

Regarding history, note that I didn't say "A positive history of the US" -- which would imply a one-side approach -- but rather, "THE positive history of the US" which implies a balance to the wholly negative viewpoint which does tend to dominate the public school history curricula (and if you don't see that aspect happening, I suggest you're sadly out-of-touch with what goes on in the realm of public schools). I'm flatly opposed to classes that assign as texts ONLY such anti-American bromides as Zinn's Marxist "People's History of the United States" (which goes out of its way to demonize the very existence of the country in which the author benefits revenues for castigating it) without providing a counterpoint view. Yes, I too prefer a balanced curriculum which not only examines the controversial and outright repugnant events in American history BUT ALSO those events which are worthy of pride, emulation and inspiration -- and I believe that with whatever ugly scars that mar the US historical narrative there are far more of the positive than negative to be heralded on balance. THAT's reality, not the radical, anti-American, Zinn-type PC nonsense that unfortunately too many of our children are brainwashed with in the contemporary public school arena.

And since too many in that arena (at the mercy of Teacher's Union agendas) fail to provide the type of educational curriculum (mentioned previously) I as a customer of their services prefer, I reiterate my main point that a school voucher system would encourage the creation of an alternative to that hostaged system and provide the opportunity for me to see my children educated in the way I want for my money spent: more on the basics (mathematics, science, reading, history, literature, economics) and less on the feel-good social programming (environmental awareness, gender awareness, multiculturalism, etc). That's simply an extension of me taking responsibilty for the raising of my child -- an aspect of conservatism which is in far closer step with reality than any Leftist village it supposed takes to do the same.

No, you don't understand
What the government owes is what they LEGALLY owe other people (just above $5.1 trillion). The outstanding obligations will never actually translate into the numbers (I've seen $57 billion, in one figure) that you mention. The government will renege on those promises, most likely. Or, the correct buzzword will be 'reform' or something. Take your pick.

Either way, there are no bonds out there held by investors to the tune of even $40 billion. There never will be. We 'owe' that to ourselves in some fantasy book entries, no more.

The bond market knows this and factors it in to the prices. While Chinese exporters for WalMart will care if millions of boomers are left destitute, Chinese bondholders will not (so much).

Thanks for the examples
Of how you misuse terms and statistics as buzzwords to confuse the unwary.
But I refuse to be pulled into your trap of just causing discord. I've made my points and if people want still be fools, they have that right.

Fleming vs Nestor
ONE of the various Supreme Court rulings was Fleming vs Nestor (1960). Of course, people should know that Bob here just wants me to waste my time on fool's errands, so I won't bother looking up the others. Here's a little diddy on it. And before Bob tries more tricks ('contractual rights are not the same as property rights!'), please note that contractual rights fall are a form of property rights. I'm sure he'll come up with something else to waste my time and try to confuse you, too.

=====================================================
In this 1960 Supreme Court decision Nestor's denial of benefits was upheld even though he had contributed to the program for 19 years and was already receiving benefits. Under a 1954 law, Social Security benefits were denied to persons deported for, among other things, having been a member of the Communist party. Accordingly, Mr. Nestor's benefits were terminated. He appealed the termination arguing, among other claims, that promised Social Security benefits were a contract and that Congress could not renege on that contract. In its ruling, the Court rejected this argument and established the principle that entitlement to Social Security benefits is not contractual right.

appreciate that
Zyndryl, you need to stop listening to Mark. I'm not here to waste your time or try and get you to do fool's errands. I'm not here to sow dissent, or for traps or tricks. I'm going to read about Fleming v Nestor because I want to learn. I'm not trying to confuse anyone either.

I don't know what you mean by saying I'm trying to trick people by implying contractual rights are the same as property rights. I've never thought about the difference. Now after thinking about it for 2 minutes, I can't say I recognize a difference, so I need to learn more. Apparently you think they're very different, Z. I'd be very interested to read your explanation, it would help me form a perspective. But whatever. I'll read and do it on my own anyway too.

I just want to make this point. Others are very willing to tell my story for me, but its not an accurate story, so I must correct it. I'm not static in my views, I'm not ideological. And if I am ideological about a subject, my hope is that I recognize it and can thusly break that spell. I'll respond on our economics discussion a little later.

have to continue to disagree
Creationism says that the earth was created in place, some 5000 years ago. All animals were created as they now appear at that time.

ID says that the earth is 5 billion years old and that animals evolved over time.

For the life of me I can't see how anyone can claim that these two are essentially identical.


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