RE: It Will Only Get Worse

[flintlock]

Re: It Will Only Get Worse

Our Government sector is sucking up extra capital that could be deployed to other areas of the economy.

Good point. The Government is fast becoming all that remains of the economy. (To some degree out of necessity). People who advocate "eating the rich" seem to fail to understand that at some point these capitalists will just take their ball and go play somewhere else,( which is already happening) Outsourcing is one reason we have such high unemployment and low wages today. So short of trade restrictions and protectionism, the "eat the rich" strategy will not work, regardless of anyone's naive political philosophy. I 100% agree we have wealth disparity. For that we can thank the myth of Globalism as a win/win situation for everyone. It obviously has not worked out the way it was sold to us.

But don't feel bad. Massive wealth disparity has generally been the way of the world for centuries. We've just been spoiled by our short span of history when the common man could actually support himself and his family quite nicely. That is going the way of the dinosaur I am afraid. Poverty and government dependence will be the new normal.

[flintlock]

Re: It Will Only Get Worse

The number of homes under construction is the fewest in 40 years. Just 413,000 homes are under construction, after accounting for seasonal factors. A decade ago, roughly 1.6 million homes were built.

http://www.usatoday.com/money/econom...rts-july_n.htm

I've noticed quite an uptick in new homes being built in my area. Mostly all existing developments that had shut down. Not necessarily selling though. Most sit empty. Are the banks merely finishing up dead neighborhoods to get them off the books? From the prices I see, they couldn't be making much money. A friend bought a new home recently that had to be purchased at or below actual construction costs.

[mesyn191]

Re: It Will Only Get Worse

Mesyn191,
Lets get back to some facts I reported earlier

Because of the cost of living and they dump that money right back into local business and thus the local economy. If you don't mind explain how people spending less is a net positive for the economy? Bear in mind that if you cut taxes the businesses usually just increase their profits and don't pass along the savings nor do they create jobs much less good paying blue collar jobs.

Re: Grass Airfield - they didn't flee to another location - they simply shut down the business...business was waning...higher fuel costs

The latter makes a lot of sense since $35K isn't a huge amount of money for a moderate sized business that is doing OK much less good. That doesn't necessarily negate what I said though.

Mesyn - I'm well versed in the FIRE economy and how it works. I've read both of EJ books... Did you read EJ article on the Growth of Government sector employment - it was very well done.

Nope, but I've read this one. The Conservative Nanny State- How the Wealthy Use the Government to Stay Rich and Get Richer Whole thing is available on line to read for free.

Regarding - 1-3% wage increases - Public sector employees and FIRE employees are they only employees who have seen their wages keep pace with inflation. lots of private sector (including white collar) have had their wages FLAT for 10-12 years!

So you'd penalize the public sector employees too? How is this a good thing? I thought we were supposed to look for ways to make everyone's life better, not to screw everyone over? I mean wages keeping up with inflation was one of those things that was thought of as what a business had to do at a minimum, else wise they'd be effectively paying their workers less and less over time for the same work!!

We don't need a revolution - we need more Politicians like Christie - although I'm not convinced is making that much progress - it may just be a lot of hot air.

He is as full of BS as the rest of them. I don't think there is a single decent politican you can point to right now.

[c1ue]

Re: It Will Only Get Worse

Originally Posted by BK
We don't need a revolution - we need more Politicians like Christie - although I'm not convinced is making that much progress - it may just be a lot of hot air.

He is as full of BS as the rest of them. I don't think there is a single decent politican you can point to right now.

The interesting thing about Christie is that he's almost at the correct point: that all of New Jersey is in a crappy situation and everyone must make some sacrifices in order for things to get better.

That is the message which leadership should be putting forward: whether at the state legislature, state governor, Congress, or Presidential levels.

The problem is I wonder how much of what Christie is saying is the "we're all in this together" as opposed to an excuse to push 'Starve the Beast' policies.

As he seems to be an intelligent and forward individual, I hope for the former.

[aaron]

Re: It Will Only Get Worse

Perhaps you can explain that New Jersey needs to pay School Crossing Guards $30-$50 - per hour to cross children across the street. Yes - Crossing Guards are Unionized in New Jersey - in most cases you'll discover the School Crossing Guard has another Public Sector job or they are a Retiree receiving a Public Pension. The additional income increases their Pension Wage base and raises their Pension.

Does anyone remember the good ole days when Responsible Children would handle School Crossing - but, children can't be Unionized because they work for Free.

I bet you will find that the crossing guard's salary has not even kept up with real inflation over the past 40 years. It is not that they are being so well paid, it is that everybody else is being raped so much harder. Now we all whine because it is not fair that government employees get paid so much.

The FED gave the banks trillions. Those same trillions would be enough to pay for all the teachers from now until the end of time. Unfortunately, that time may be not too far off.

[lektrode]

Re: It Will Only Get Worse

Look at the cost of living in NJ. If its high then what do you expect? You can't seriously expect people to work for less than what it costs to live you know that right?
.....You can slash all workers wages by half or more and it would accomplish nothing. ...

i guess it all depends on precisely _what_ 'workers' you are referring to.

if they are public sector workers, its cheaper BY FAR to put them on unemployment and foodstamps than it is to pay them their regular salaries to continue 'working'

and i use the term 'working' quite loosely here, because in my observation, any state like NJ - a BLUE STATE - they could s__tcan 1/3 to 1/2 the 'work' force and NOBODY (except the unions) WOULD NOTICE THE DIFFERENCE!!!

so my first question becomes: is the state YOU live a bluestate, political hog sloppin cesspool of corruption?

i have had the 'opportunity' (if ya wanna call it that) to live/work-selfemployed in both red and blue states and let me state RIGHT HERE RIGHT NOW: there's a HUGE difference, in how things work and get paid for.

the 'gold standard' is New Hampster....

NJ? right up there with CA, MI, NY = corrupt/dysfunctional to their rotten core, with their state leg's bought off by the public sector unions = The Worst Conflict Of Interest imaginable

you can scream all you want about FIRE this and FIRE that...

BUT THE PROBLEM IS THE POLITICAL ARISTOCRACY HAS COLLUDED WITH AND SOLD OUT TO THE PUBLIC SECTOR UNIONS.

and i live with (and pay for) the consequences of this nightmare daily.

[lektrode]

Re: It Will Only Get Worse

....It occurs to me that there was a time in the not too distant past when many states, my own as an example, did not have a sales tax. Did not have an income tax. Did not run legalized betting, twice daily, twice weekly, pick 5, pick 6, as well as a multitude of scratch and win scams. Where did all that money go? Why will the future not be the same as the past?

and then there are _still_states THAT DONT, nearly 400 years later, NH _still_ has neither, and gets along just fine

where did the money go?

i dont have time at the moment, but i will post a few examples that have sucked up HUGE chunks of the TRILLIONS of GDP (state as well as fed) and then we can argue whether or not its the bad ole FIREmen who have cratered the states budgets, and by extension, the feds... not that i'm 'defending' the FIRE fraud, but the out of control .gov is just as much at fault and in BOTH CASES its our self-serving hack politicians that have SCREWED ALL OF US!!!!

[Sutter Cane]

Re: It Will Only Get Worse

I bet you will find that the crossing guard's salary has not even kept up with real inflation over the past 40 years. It is not that they are being so well paid, it is that everybody else is being raped so much harder. Now we all whine because it is not fair that government employees get paid so much.

The FED gave the banks trillions. Those same trillions would be enough to pay for all the teachers from now until the end of time. Unfortunately, that time may be not too far off.

And what does a crossing guard work? A couple of hours a day, in the morning and afternoon, from Sept.-May? It's not like this is a full time job, it is probably a job performed by retirees trying to stretch their cat food dollars. And lets remember that they are performing an actual service with real and tangible results - stopping cars so little kids don't get run over when crossing the street. Maybe one of these kids will grow up to find a cure for cancer, or maybe just drive the ambulance that takes an American to the hospital after they have a heart attack from fuming over how overpaid those union workers are. So there's some small societal benefit.

And I'm taking this apocryphal $40-and-hour crossing guard at face value - I have serious doubts that such a wage for that job exists. Meanwhile, we've got SEC documentation that Lloyd Blankfein's estimated total compensation for last year was $18,600,000.00!! Figuring 40 hours a week, 52 weeks a year (of course, that's on the low side for hours worked, since Lloyd works very hard and earns his money, not like those freeloading union goldbrickers), that's roughly $8942.00 an hour. And that's just his compensation, I'm sure he's making ungodly amounts from investments that a unionized crossing guard would never even have access to.

Please, let me know what societal benefit is gained from Blankfein's labor that even approaches the level of helping a kid across the street.

But no, the problem is clearly that somewhere, a union/government worker is getting paid too much.

[unlucky]

Re: It Will Only Get Worse

The interesting thing about Christie is that he's almost at the correct point: that all of New Jersey is in a crappy situation and everyone must make some sacrifices in order for things to get better.

This is a critical point. The fact is that excessive private borrowing via the FIRE economy also drives tax revenues. That's why it's easy for politicians to support the inflation of a FIRE bubble; the private sector benefits directly and the public sector benefits through greater tax revenues as the bubble inflates. When the bubble deflates, the expanded public sector has to be funded through greater public borrowing, which the government typically justifies for the time being as a "Keynesian" counter-cyclical measure. (In truth, it is the opposite of Keynesian since the original expansion in spending was pro-cyclical). Thus public borrowing partly replaces private-sector bubble borrowing.

The denouement is that as bubble deflation progresses, ultimately the public sector is also impacted and must experience contraction. Just what we see today. Political leadership is required to get everyone to understand that sacrifices are required by all.

[BK]

Re: It Will Only Get Worse

unlucky - thank you!
Currently, there are large blocks of Public sector employees who think the should be immune from the choas - and austerity.

How will that work and where will the money come from o keep them whole????? More public borrowing, higher taxes, print more money and cover all the public sector obligations. I don't have the answers and I'm know lots of great people who work in the public sector and deserve to be treated fairly.....but, the beast is running of money......

[mesyn191]

Re: It Will Only Get Worse

People who advocate "eating the rich" seem to fail to understand that at some point these capitalists will just take their ball and go play somewhere else,( which is already happening)

Doesn't have to be that way. The laws are already on the books to prevent that sort of thing from happening, just like laws already exist to prevent the worst of the abuses and corruption, they simply aren't being used or enforced because the people are running our government often do not want to enforce the rules. At least when they apply to the rich. For small to mid sized businesses and the poor/middle class the rules are often enforced to the letter.

Outsourcing is one reason we have such high unemployment and low wages today. So short of trade restrictions and protectionism, the "eat the rich" strategy will not work, regardless of anyone's naive political philosophy. I 100% agree we have wealth disparity. For that we can thank the myth of Globalism as a win/win situation for everyone. It obviously has not worked out the way it was sold to us.

Outsourcing is one of the reasons. The other is that the government letting the corps do more and more of what they want gradually over time with no respect to labor. Stopping the outsourcing wouldn't be hard at all. Just the make the corps pay a FICA-equivalent tax for every job they outsource and that problem would go away overnight and it would largely solve the SS and Medicare funding issues.

But don't feel bad. Massive wealth disparity has generally been the way of the world for centuries. We've just been spoiled by our short span of history when the common man could actually support himself and his family quite nicely. That is going the way of the dinosaur I am afraid. Poverty and government dependence will be the new normal.

Hope your being grimdark sarcastic here. Reeeaaaalllyy really do. ;(

[mesyn191]

Re: It Will Only Get Worse

and i use the term 'working' quite loosely here, because in my observation, any state like NJ - a BLUE STATE - they could s__tcan 1/3 to 1/2 the 'work' force and NOBODY (except the unions) WOULD NOTICE THE DIFFERENCE!!!

You know there is this chart previous page that I posted that shoots this meme down quite thoroughly....

so my first question becomes: is the state YOU live a bluestate, political hog sloppin cesspool of corruption?

Currently live in CA but also lived in NJ, NY, VA for years at a time and stayed for a short time in nearly all of the lower 48. This does not make me the end all be all arbiter of info on these states but from what I saw they all had their good and bad side to public service. Like most anywhere most of the corruption occurs in city hall or the state capital and not out on a freeway construction site.

BUT THE PROBLEM IS THE POLITICAL ARISTOCRACY HAS COLLUDED WITH AND SOLD OUT TO THE PUBLIC SECTOR UNIONS.

I've read that the entire budget for public civilian employees is something like $2-300 billion a year. The deficit is something like $14 trillion IIRC. You keep hatin' on those public sector unions who may possibly be wasting some of that $300 billion or so, which is large BTW but piss ant in the grand scheme of things, while FIRE blows trillions of our cash. Also you're going to have to demonstrate a link between "BIG POWERFUL UNIONS", which don't even exist anymore, and FIRE because for some reason FIRE keeps busting what little unions we have left while outsourcing jobs and slashing wages and benefits.

[mesyn191]

Re: It Will Only Get Worse

unlucky - thank you!
Currently, there are large blocks of Public sector employees who think the should be immune from the choas - and austerity.

During a recession the government is not supposed to enact austerity measures since that always makes a recession worse. Also the poor and middle class are bearing a disproportionate measure of the suffering/austerity, the rich are getting richer, massively so during this "recovery".

Even by your own standard of fairness this situation is mindblowlying unfair and yet the problem is public unions? Who BTW already took a 2 year pay freeze and have had cuts too? Really? You can fire every one and put a private sector guy in his place and state's budgets will still be screwed.

How will that work and where will the money come from o keep them whole????? More public borrowing, higher taxes, print more money and cover all the public sector obligations. I don't have the answers and I'm know lots of great people who work in the public sector and deserve to be treated fairly.....but, the beast is running of money......

Crank the taxes on the rich, end the wars, implement means testing, and poof, our budget problems would be fixed for decades. The idea that this situation is unsolvable is BS. And that is without touching healthcare or improving the efficiency of our energy grid to get us off forgien energy dependancy.

[lektrode]

Re: It Will Only Get Worse

.....


I've read that the entire budget for public civilian employees is something like $2-300 billion a year. The deficit is something like $14 trillion IIRC. You keep hatin' on those public sector unions who may possibly be wasting some of that $300 billion or so, which is large BTW but piss ant in the grand scheme of things, while FIRE blows trillions of our cash. Also you're going to have to demonstrate a link between "BIG POWERFUL UNIONS", which don't even exist anymore, and FIRE because for some reason FIRE keeps busting what little unions we have left while outsourcing jobs and slashing wages and benefits.

cant say i'd have an argument to that, but the point is the 'spending' isnt _accomplishing_ anything, and is costing the trillions.

the SPENDING has to be adjusted, and from what we have seen in the private sector, where the PC 'revolution' dramatically reshaped the document management side of corp IT - meaning that private biz eliminated whole buildings full of people whos primary function would have been to fill file cabinets to provide management with the numbers, data, info, metrics, whatevahs, right?

today all that capability resides on the C class' cherry, with black granite trim desk tops in the form of a networked PC

for 35 years now i've been waiting for the 'revolution' to 'trickle down' to me in the form of lower .gov overhead....

and i'm still waiting.

[mesyn191]

Re: It Will Only Get Worse

the SPENDING has to be adjusted,

Sure, but there are better places more deserving of cuts that would save tens of billions if not hundreds of billions a year and would help the economy than going after the workers. Go after the drug companies and have Medicare actually negotiate properly for lower drug prices. Reduce our military over seas, we don't need hundreds of bases all over the place even if you do think we need to be in Iraq/Afghanistan. Can the projects that are little more than inefficient pork barrel mass employment "warfare economy" give aways and put those dollars towards municipal renewal programs which have a better return on investment. Stop throwing money at the housing market and let the prices fall to a more sustainable measure. And if that makes some banks go under then fine put them into receivership and make the investors eat the losses from bad debts.

That last one alone would be a huge boost to the economy. And while I'd prefer a UHS of some sort note that one isn't required to vastly improve the budget and healthcare cost situation at all. There is no real reason except for politics why we can't do any of that.

and from what we have seen in the private sector, where the PC 'revolution' dramatically reshaped the document management side of corp IT - meaning that private biz eliminated whole buildings full of people whos primary function would have been to fill file cabinets to provide management with the numbers, data, info, metrics, whatevahs, right?

From what I understand this has sort of happened to an extent in government too. They've been trending to more computerized stuff for years to replace office staff. They're generally slower at doing it due to regulations than some other businesses but they are doing it.