A Blank Spot on the Map

Tuesday, June 28, 2011

100 babies post

Here’s the problem or the difference in the way we see things. As a pediatrician and a father I tend to look at the rules from the perspective of a newborn baby. You guys are always thinking of the rules as they pertain to you.

To me ideally every baby is starting out as equally as we can make it. So if we have 100 babies and we tell them at some point 5 of you are going to be paying the top marginal tax rate they are all gonna be OK with it. Especially when I tell them that the roads, the schools , the water canals, their milk ect… that made them have a more equal opportunity were all funded in the same fashion. They’ll all say sure sounds good to me. Trust me … I know babies and that is what they would say. I don’t really give shit about the crowd… my own generation who benefited from previous high tax rates and now are getting a change in tax rules and are getting out of their obligations to put back into what helped them to be safe and successful.

You are the sons of bitches who think its ok to pass on trillions of dollars of debt to the next generations and steal from them … leaving the country and their opportunity much damaged. Most of the debt IS a result of decreased tax rates that WERE NOT there when you self centered crybaby jackasses came to the scene. Pay your god damn debt to society and stop asking for more tax cuts so our kids have to deal with it…. YOU ARE THE THIEVES…. and stealing from children no less.

Sunday, June 26, 2011

A debate on the signficance of income inequality and it's effects on the economy.

A Debate About Whether Libertarianism or Liberalism is the New Feudalism

An EPIC debate and discussion between Greg Webb and George Balella.

So the simple question is how does libertarianism NOT result in serfdom. My thesis being that in a truly libertarian society eventually all property and all the means of production will be owned by a minority of the population leaving the rest poor and in servitude....ewe... that's one ugly society.

Wednesday, June 22, 2011


Monday, June 20, 2011

The Neoliberal Economy in a Nutshell

Economics in a Nutshell

Ravi Batra ; The New Golden Age

The Rising Wage Gap

Four main causes of poverty in the United States
1) The rising price of oil
2) Low minimum wage
3) Regressive taxation
4) Globalization

Wage productivity gap

All four relate to government policy and reflect official corruption because they all impoverish the general public while making the rich richer. Furthermore, they add to the global economic imbalances and threaten to unleash global chaos in the near future.

Official corruption threatens economic stability around the world because it raises what may be called the wage gap which simply is a measure of the difference between labor productivity and the real wage. For the sake of precision, the wage gap may be defined as worker productivity divided by the average real compensation of employees. An economy functions smoothly and efficiently only if this gap remains constant and small. It morphs into a myriad of imbalances if the gap grows as it has since 1980. An economy is efficient if it maintains full employment with out resorting to excessive debt. Excessive debt itself is linked to the rising wage gap. Anything that lowers domestic labor demand tends to raise the wage gap because when labor demand declines the real wage falls relative to worker productivity. The rising price of oil, low minimum wage, regressive taxation and globalization all tend to trim domestic demand for workers. So they all increase the wage gap over time.

How is all this relevant to our economy? Wages are the main source of demand and productivity is the main source of supply. Overtime, business investment and new technology lead to a rise in productivity and hence supply. If real wages keep up with productivity consumer demand matches the growth in supply so that the demand supply balance is maintained in a natural way. Here the economy tends to function smoothly and efficiently. However, if real wages trail productivity growth and the wage gap rises, supply grows faster than demand. Many distortions then arise and if they are allowed to fester the end result is growing poverty and possibly economic collapse.

The first distortion is that debt must rise exponentially to increased demand. Because this is then the only way to close the demand-supply gap arising from the growing wage gap. The borrowing may be incurred by consumers and the government but not by cash rich corporations. The quantum leap in budget deficits in the US economy since the early 1980’s is purely the result of this phenomenon. This is the first distortion because the demand-supply balance is maintained artificially by ever increasing debt creation and cannot be sustained forever.

The second distortion occurs from a quantum jump in corporate profits. Once the demand-supply balance is maintained through increased debt then profits must rise sharply because with wages growing sluggishly the fruit of increased productivity accrues mainly to the owners of capital. So CEO incomes jump. The profit leap is a distortion because it cannot be maintain without mushrooming debt. The artificial rise in profits triggers an artificial jump in share prices and leads to a stock market bubble which must burst one day because it is all supported by an exponential rise in borrowing.
The moment debt growth slows profits begin to fall and this can lead to a crash. As occurred in1929.

One distortion feeds another. As the market crashes the government must do something to contain its aftershocks. For instance, it slashes interest rates to lure more people into borrowing. If it does not a depression may result as in the 1930’s. But if it does, there will be a housing bubble because exceptionally low interest rates generate big declines in monthly mortgage payments and thus raise the demand for homes. So the government avoids a depression but only at the cost of future stability. This is why we now face a housing bubble around the world in the aftermath of the global stock market crash of 2000.

With the continued rise in the wage gap the rich keep getting richer at a record pace. But the stock market crash puts them in a quandary. What to do with all that money? With the share market losing its allure the rich look elsewhere. They maybe ultra rich but they want even more. So their cash ends up in exotic assets such as hedge funds, especially those that discover new avenues of speculation like investing in oil or mortgage backed securities.

These are all distortions that have results from the rising wage gap in the United States.

Sunday, June 12, 2011

Great Summary paper on the economy.

Read this neoliberals

Thursday, June 09, 2011

Walking Neoliberals though the financial crash

Let's start here: Why in 1970 would you never consider making a NINJA loan but in 2003 many people did make such loans? What was different? What changed such that lenders would consider such a thing?