Monday, October 10, 2011
Out of the Mouths of......
One of wd's most consistently voiced talking-points/accusations is that the Republicans caused the Great Depression. Yeah, huh? Well, guess what, being that the Republicans were the protectionist party back then (the passing of Smoot-Hawley, in particular) and that, not one, not two, but three Republican Presidents governed in such a manner, the dude may actually have a decent point this go-round. What do you say that we give it up for Mr. wd?... This, folks, from Wikipedia; "Most economists at the time and since agree that it (Smoot-Hawley) had a negative effect on the economy. After the 1929 stock market crash unemployment never reached double digits in any of the 12 months following that event, peaking at 9 percent, then drifted downwards until it reached 6.3 percent in June 1930. Then the federal government made its first major intervention in the economy with the Smoot-Hawley tariff. After that intervention the downward movement of unemployment rates reversed and shot up far beyond the level it had reached in the wake of the stock market crash hitting 11.6."
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44 comments:
There is one important difference between then and now. Then, the US was a net exporter. Now, the US is a net importer.
That's a fair point, Jerry.
Let me just reiterate what I said to wd and dmarks on a previous thread. The truth, IMO, is that there are pluses and minuses to both free-trade and protectionism. My own belief is that, over the long haul, free trade (combined with other policies such as job retraining) is ultimately preferable. And you know who just happens to agrees with me here - Mr. Obama's own Jobs Czar, Jeffrey Immelt.
A much larger difference.
In 1929-1933 the US was the worlds swing producer of oil. The Texas RR Commission controlled the price of Oil for the industry in the US to keep a stable flow of money. You could pump all you wanted BUT could only TRANSPORT what the RR Commission allowed you to transport. Since Texas was the swing production state for the US, the RR Commission could up or lower quotas for transport to keep prices in line. That was until 1972 when they removed all restrictions due to the peak of oil production in the lower 48. After that the US market wanted more oil then the lower 48 could produce so pumping all out for all was OK.
We could supply all we needed, now we import two out of three barrels we use.
The entire planet hasn't increased production of crude plus condensate (oil) since 2005. The producing countries of Opec + Russia are using even more each year meaning less available for export. Given the groth of Arab populations combines with the economic growth in China and India, the export markets will further shrink for the US meaning ever rising prices even with lower supplies.
In fact 2005 was the maximum export year world wide for oil, each year since the total amount available on the planet's oil markets for export has declined. No large new production is coming online anaywhere on the planet to make up for the denmands of both the Arab street and Chinida Economies, hence, we face a bleak future for economic growth based on the use of petrolium as either a production stock or energy source.
With out increasing oil for growth, economic recovery let alone future growth cannot happen. Simple actually, no increase in oil for export no increase in oil to drive our western consumer style economies, results in decline of said economies. Money doesn't CREATE oil in buys the equipment to pump and transport and refine it. IF the amount of oil isn't increasing when the prices are rising quite significantly then something beside MONEY must be restricting the oil available across the entire planet.
This restriction, which is geological in nature, will result in no ability to grow the consumer style western economy continued stagflation, because prices will rise as both raw materials and transportation of both will rise due to the rising price of energy. The restriction is simple, all the easy cheap light sweet crude has been found that is economical to produce at prices coherent with the western style consumer economies.
No sources for large new discoveries has happened like it did in the 1930-1960 time frame with production outpacing new discovery ever since the mid 80's. This is why they are mining the Canadian Tar sands for crude, which is much more expensive economically then pumping crude from a well. It also is much more energy intensive meaning we use more oil for each barrel we get from the Tar sand production then we ever did drilling and pumping.
(cont)
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Unless we change the way we power our economy, the slow decline of available oil for export from those few countries who pump enough to export oil, no economic future except for recession/depression with stagflation is possible,
MAJOR difference from the position we were in circa the 1932 election year.
PS: the entire North American continent has been explored by the for profit capitalistic based oil corporations, and they have chosen to drill in Nigeria, dig sands in Canada, and deep water because nothing is left in any game changing amounts on land in the NA continent. ANWAR has less then one years TOTAL recoverable amount of oil available, and pipelines and infrastructure would need to be built to produce it.
The whole decline of the middle class since the late 70's has partly been fueled by the simple fact we keep siphoning off billions of revenue from the American economy to hand to foreign countries for oil, more each year. Since the wall street wealthy types got protection from the trickle down GOP ideology during this time, those billions came out of the growth in income for the middle class.
Until this paradigm changes the US economy cannot change course from the decline of the middle class with ever rising debt, both public and private.
It really isn't as much GOP vs Dem, as the large financial interests protecting their place against the rest of the country, with the shrinking pie both energy and economic mostly coming from the 99% who do not benefit from the last 30 years of free market/anti worker driven ideology.
The game of creating FIAT money out of whole cloth by Wall Street games just ran into the first PHYSICAL barrier, the geological limits to cheap easy energy. The decline in energy, limits the growth, which results in a shrinking economy, which causes a declining ability to create new debt which the fiat money system runs on. at the same time old debt become more and more expensive to service hence the bankruptcies we have seen since 2007 forward and the problems the Euro zone faces.
The housing bubble is a symptom not the root cause if you will.
BTW I am not the only one who sees this;
IMF warns of ‘dangerous’ phase of economic decline
The world economy has entered a “dangerous new phase” of declining growth that will require policymakers to take action, the chief economist of the International Monetary Fund (IMF) warned Tuesday. In its “World Economic Outlook,” the IMF steeply downgraded projections it made in June regarding the U.S. economy. The international lending organization had predicted a growth of 2.5 percent in 2011 and 2.7 percent in 2012. In just three months, the forecast has changed to 1.5 percent in 2011 and 1.8 percent in 2012.
A declining world economy
"It is about whether the international financial system will survive the next six months in the form we now know it. It is about whether the foundations of the postwar order are cracking in Europe. It is about whether a global financial crash will further destabilize the Middle East. "It is about whether the incipient signs of a bubble burst in China signal the start of an extended economic and perhaps even political crisis there. It is about whether the American middle class is about to be knocked off its feet once again."
Time from a few weeks ago. TIME: The Decline and Fall of Europe (And Maybe The West)
Oil has been the fuel of the worlds economy since WW2, our current predicament isn't hard to figure out. The stagnant production figures for oil and resulting inability to create new debt to fuel the FIAT money style consumer economy is incompatible. Unless you change the way we power the economy and create a new paradigm instead of fiat money to finance it, no amount of job training can work. For the jobs won't appear with out the energy resources to power them.
There are ways out, but at the present time very unpopular with the country at large. Recreating the infrastructure we built in the 1950-1990 time frame in a declining oil future is very short sighted. We need to create the infrastructure we will need to use the energy resources we will have available in the next 30-50 years, now that we still have enough oil to fuel a significant portion of the construction.
Given the current political climate and the way the MSM pander that is very unlikely. Without a new leader like FDR who can see how the future will unfold and plan for it, no government OR private efforts to restart a failing economy starving for a fuel that is increasing in costs while declining in availability can succeed.
Nor will, tax cuts create the energy resources we need because it is the geology of the planet that is starving all of us for the cheap easy to produce energy resources we need. Wall street and Corporations are sitting on trillions, but no amount of capital can find oil if it isn't there. Reagan found this out when he handed out Billions to drill for oil that just wasn't under the ground during his first term. Prudhoe Bay, Cantrell, North Sea oil was what was needed after we began declining our production and each came on line full force after 1982.
Now all three are in decline along with Burgan. No fields near this size has been found to replace them. Matthew Simmons a oil investment banker thought even Ghawar was declining because in 2003 he found out they were pumping 30 barrels of water for each 100 barrels they pumped out of the field, a 30% water cut. The Saudis are also injecting massive amounts of water to keep pressures up to keep production up however, it shortens the time any field can produce.
The whole mess is really driven by the decline of oil both in real terms AND more importantly the available oil that western economies can obtain through exports.
Will: ...the dude may actually have a decent point this go-round.
I assume you're joking. If not, you're lying. I never made that point and you know it.
That Smoot-Hawley contributed in any way what-so-ever to the Republican-caused depression is a Right-wing myth.
Obama, and his jobs "czar" are wrong on free trade. Yes, many Democrats have drunk the free trade kool aid. You pointing this out proves nothing.
Jeffrey Immelt, you mean the CEO of GE who pays NO taxes while shipping tens of thousands of good paying middle class jobs to South America and other sub minimum wage shops making billions in profits, that Jeffery Immelt???
Will - Ya hit a nerve with this one.
Yeah, I guess so, Les. LOL
And, wd, that Smoot-Hawley contributed to the Depression being a right-wing myth - WRONG!! It isn't a myth at all (wikipedia is part of the vast right-wing conspiracy now LOL!!). It's a virtual consensus among mainstream economists and historians.............John A. Garraty is one of the most acclaimed historians of the 20th Century and this is what he had to say about Smoot-Hawley; "In 1930, Congress passed the Hawley-Smoot Tariff Act, which raised the the duties on most manufactured products to prohibitive levels. Although OVER A THOUSAND (my emphasis) economists joined in urging Hoover to veto this measure on the grounds that it would encourage inefficiency and stifle world trade, he signed it cheerfully. The new tariff made it impossible for European nations to earn the dollars they needed to continue making payments on their WW1 debts to the United States and also helped bring on a financial collapse in Europe in 1931.............................................................................................He (Hoover) seemed unable to grasp what should have been obvious to a man of his intelligence: that high American tariffs made currency devaluation almost inevitable in Europe and that the curtailment of American investment on the Continent as a result of the depression had dealt a staggering blow to the economies of all the European nations."............Gee, let's see, who should I believe, John A. Garraty and Wikipedia...or some partisan stooge who's totally incapable of seeing any sort of gradation? Hm, I really need to think on this one NOT!
"Rational" Nation: Will - Ya hit a nerve with this one.
You don't like what Will said? That's strange, being a Libertarian I'd have guessed you'd be in favor of destroying the middle class to increase corporate profits by outsourcing American jobs.
But maybe "Rational" Nation is referring to me? If so he's wrong. I'm bored. Will keeps bring up the same topics over and over and over. His next post will probably be one arguing in favor of eliminating the corporate income tax.
Will: ...or some partisan stooge...
I don't know what "partisan stooge" you're referring to. My comment didn't contain any quotes.
Will: Smoot-Hawley contributed to the Depression... isn't a myth at all.
This myth fits in with your ideology, so it makes sense that you'd assimilate it instead of accepting the truth. Anyone can edit Wikipedia, btw. I've heard that Right-wing organizations hire people just for that purpose.
Is there any outrageous accusation that you WON'T make? You're frigging accusing me of altering Wikipedia material now? I cut and pasted it, you asshole. And the Garraty quote I extracted directly from one of his texts. Man, are you ever one paranoid stooge. And since when is U.S. trade policy strictly a left vs. right thing anyway? FDR and Truman supported free (or at least freer) trade. Harding, Coolidge, and Hoover supported protectionism. And even more recently you had guys like Pat Buchanan and Ross Perot arguing against free trade and guys like Clinton and Gore arguing for it (Obama, he's pretty much trying to have it both ways). Hey, I'll bet that you only watch black and white movies, too.
WD said
Anyone can edit Wikipedia, btw. I've heard that Right-wing organizations hire people just for that purpose.
will said;
You're frigging accusing me of altering Wikipedia material now?
Will are you trying to confirm an unsubstituted rumor?
LOL
Or just being your normal dense self pretending to see something that nobody actually wrote?
Will: You're frigging accusing me of altering Wikipedia material now?
No. I don't know what gave you that idea. I said, "I've heard that Right-wing organizations hire people just for that purpose".
PEOPLE, not "Will Hart". I didn't say I thought you were one of those people... unless you're admitting something.
Also, I know who supports free trade. Republicans and Conservative Democrats. Further in the past things were different as Jerry pointed out... the US used to be a net exporter.
btw, this "stooge" BS is getting quite old. I don't defend the Democrats when they're wrong... and they are wrong on free trade. I am therefore not a stooge. Although, no doubt, you'll continue to refer to me as one.
DIFFERENT SUBJECT
Choose one of the following
Eric Holder is????
a.Incompetent
b.Impotent
c.A liar
d.A Stedman double
Choose one of the following
Eric Holder is????
a.Incompetent
b.Impotent
c.A liar
d.A Stedman double
E None of the above.
E
ding ding ding
Right answer.
Wrong again number boy.
The answer is d,a Stedman Graham double.You fall to last place...your usual station in life.
wd, you said something that was demonstrably wrong. You said that the belief that Smoot-Hawley contributed to the Depression is a right-wing myth. It is not. It is a common viewpoint that is held by many mainstream historians and economists. I proved that by citing Wikipedia and Professor Garraty (a person with more credibility in his little pinkie than Thom Hartmann has in his entire body). But, instead of just accepting that you were wrong, you go into this paranoiac bullshit about the right-wing hacking into Wikipedia (left-wingers don't, apparently). What in the hell is the matter with you, man?
And this whole bullshit about people who disagree with you on an issue being "wrong", you really need to outgrow that, fella'. If you knew even the slightest about epistemology you'd know that there is very little that we can know with absolute certainty (and that is why I started out this thread pointing out that there are pluses and minuses to both positions).......YES, we do lose jobs due to free trade and outsourcing. But we also gain some jobs because of them. We had close to full employment for nearly 20 DESPITE these supposedly terrible concepts. Me, I would much rather have relative free-trade and match that with better job retraining, tax cuts for the working and middle classes, and some common sense regulatory reform (go through all Federal regulations, get rid of the stupid shit, beef up the good shit) than do something that could potentially a) cause a trade war, b) wreck other countries' economies, and c) eventually wreck our own.
So, because person A hasn't adequately prepared himself for the rigors of a 21st century economy, person B, who has (by taking night classes, by being adaptable, etc.), is forced to pay significantly more for his goods and services? Oh, yeah, that's fair.
Rusty Shackelford said...
Wrong again number boy.
Will said;
And this whole bullshit about people who disagree with you on an issue being "wrong", you really need to outgrow that, fella'.
+1` will
Will: ...this whole bullshit about people who disagree with you on an issue being "wrong", you really need to outgrow that, fella'.
In other words I need to stop having an opinion? Perhaps you should take your own advice? I advise deleting your blog to show everyone how serious you are about opinions being bad.
Will said: "Oh, yeah, that's fair."
Of course its fair that people who work hard for a living get robbed to pay for the poor lifestyle choices and mistakes of the lazy.
So we have millions of people out of work because they made "poor lifestyle choices and mistakes of the lazy".
That's about the most stupid thing I have heard today.
I preface all of my opinions AS OPINIONS. And I've also always stated that their are NO definitive answers. Add to that the fact that I've consistently stated that both sides have at least SOME good ideas and that I am basically willing to compromise on anything and, yeah, I think that I'm pretty damned flexible.......And when have I ever said that your opinion was wrong on something? OK, on the Smoot Hawley thing maybe. But that was more you saying something that was patently not factual (FDR, to his credit, LOOSENED trade restrictions).......And if you look at the totality of my views, you would see that they're largely based on compromise! Yes, I want to get rid of the corporate income tax. But I more than offset it by eliminating the special consideration for cap gains, raising the top individual rates, AND reducing the cap on mortgage interest deductions. Painting me as some sort of inflexible right-winger has always been unfair.
dmarks is absolutly correct! Someone from the left please explain why an individual who worked six or seven days a week to make a success of themselves or risked their entire dollars to make a small business successful pay for someone who decided to be a social worker or a teacher who works seven months a year or god forbid a crack addict with six kids from five different fathers? Why do liberals detest success so damn much?
Jerry: No, I was referring to something in one of Will's comments.
Liberals don't "detest success"... we detest greed and highly value compassion. (link is to the dictionary definition for the word... one which Conservatives are probably unfamiliar with).
We also believe in redemption, second chances, and the simple fact that misfortune can befall anyone. If an individual is currently down it doesn't mean they have to stay down... we believe in giving them a hand up so they can become contributing members of society again.
Unlike Conservatives, Liberals don't believe in kicking people when they're down.
If I were to chose one individual from this comment thread that made an "absolutely correct" observation... it would be Jerry Critter who said, "that's about the most stupid thing I have heard today" in reference to dmarks' asinine comment about millions being out of work due to "poor lifestyle choices and mistakes of the lazy".
Sorry, it is not "compassion" when liberals favor working people turning over their hard-earned money to the ruling elites against their will, and said ruling elites let some crumbs trickle down to the poor as welfare payments. While the ruling elites prosper from it. That is what liberal sadvocate with the traditional welfare system.
If you want to look at real compassion, look at charitable giving of liberals vs conservatives.
check this
"But a funny thing happened on the way to liberalism. Americans who believe in “income redistribution” give 75% less to charity than Americans who do not, according to Dr. Brooks"
That's real compassion. As opposed to the liberal view which tends toward having the ruling elites forcibly take money from working people, which then goes to enrich bureacrats while crumbs trickle down to the poor. They call it 'welfare programs'.
Sorry, spending others' money is not compassion.
When you tax the top 1% (as proposed in the Jobs Bill), you are not giving money to the "ruling elites". You are taxing the "ruling elites" for the benefit of the other 99% of Americans.
No, the ruling elites are those who actually rule. The tax you mention is just another example of the ruling elites forcibly plundering their subjects.
And the money is for the benefit of the tiny percent that rules, not the of the rest.
It won't be funny if the greedy ruling elites get their way, and the top 1% (income-wise_ of the ruled subjects are forced to move their money offshore or find other ways to avoid the tax. Less investment here.
After all, even the richest among the ruled must submit to the avarice of the ruling elites.
dmarks: Americans who believe in "income redistribution" give 75% less to charity.
Because through our government is the best way to help people who need it. Charities are fine, but they'd never be able to get the job done alone. Conservatives wrongly think they could... and they selfishly like to pick and choose who benefits from their largess... which is why some Conservatives give more to charity (while some give nothing).
dmarks: the liberal view which tends toward having the ruling elites forcibly take money from working people, which then goes to enrich bureaucrats while crumbs trickle down to the poor.
Wrong on all counts. We elect representatives. They do what we want (or are supposed to). We decide we want to help out the less fortunate by way of paying taxes. There is no "force", except for those who don't get the concept of government and think we should live in a society where they only have to pay the taxes for the things they want.
I don't want to pay for the illegal wars in Afghanistan and Iraq. I don't want to pay for a military that is larger than the military of the rest of the world put together... is the government stealing from me?
Also, the overhead for the social safety net programs is quite low... much lower than for private charities (another reason Liberals like to "give" in this manner). No money is used to "enrich bureaucrats"... they receive modest salaries which are on par with, or lower than the salaries of employees of private charities.
"Crumbs" don't make it to those who need it, the bulk of the money does.
dmarks: It won't be funny if the greedy ruling elites get their way, and the top 1%... are forced to move their money offshore...
The greedy wealthy elites already do this. We need laws to stop them. Hiding money offshore should be punishable by a seizure of that money and jail time for the offender.
Jerry Critter: When you tax the top 1%... you are not giving money to the "ruling elites". You are taxing the "ruling elites" for the benefit of the other 99% of Americans.
Exactly, Jerry. But dmarks wrongly refers to our elected representatives as "ruling elites". He must not vote, since (according to him) the only reason anyone seeks elected office is to enrich themselves.
Some do, clearly, but they can't steal our tax money directly. They give it to the corporations in the form of subsidies and "contracts", then they receive kickbacks in the form of "campaign contributions" and lobbying jobs after they leave office.
Although the politicians who do this are, more often than not, Conservatives.
So, dmarks. Just who are these "ruling elites"? You say they are not the wealthy 1%. You certainly can't mean they are the rest of us 99%ers. Who are they? The curious want to know. Aliens?
WD said "and they selfishly like to pick and choose who benefits from their largess... which is why some Conservatives give more to charity..."
How is it selfish to choose to only give to effective charities?
WD, you are wrong on all counts.
"There is no "force"
There is force. If you refuse to pay your tribute to the rulers, and resist arrest, there will likely be violence.
"I don't want to pay for the illegal wars in Afghanistan and Iraq."
Thankfully, you are in luck. There are no illegal wars there, so not one dime has gone to any.
"I don't want to pay for a military that is larger than the military of the rest of the world put together... is the government stealing from me?"
The goal of the military is to deter aggression. There's nothing in its mission to be a certain size compared to others, so that is irrelevant.
"Hiding money offshore should be punishable by a seizure of that money and jail time for the offender."
Then I hope they escape with their money.
Jerry asked: "So, dmarks. Just who are these "ruling elites"?"
They are the ones who actually rule. Is this so hard to understand?
"You say they are not the wealthy 1%."
Some are. Some in government are very very wealthy.
Thanks for the non-answer.
dmarks: The goal of the military is to deter aggression. There's nothing in its mission to be a certain size compared to others, so that is irrelevant.
The goal of social safety net programs is to provide help to people who need it. There is nothing in it's mission to only help so much... but too much and it's "theft" when the government collects the taxes to pay for it... so your "theft" charge is irrelevant.
You have said (during a discussion on the minimum wage, which you opposed) that you are in favor of some welfare.... so what you're saying is taxes are OK so long as they are of a level (and fund programs) which dmarks approves of.
I say dmarks supports theft via taxation, because he obviously supports a large military. Fvck you dmarks for being in agreement with the theft of my money!
Cleary the greed (and desire to wage war) of dmarks makes it impossible for him to not think about how much he believes the government should steal from me.
dmarks: If you refuse to pay your tribute to the rulers, and resist arrest, there will likely be violence.
Thankfully, you are in luck. The government collects no "tributes" to the "rulers", so not one dime has gone to any.
dmarks: Then I hope they escape with their money.
Yet again you are in luck... because a lot of them have... and the rest of us have to make up the difference. But dmarks does not care... which is another example of how he hates the middle class... he thinks the middle class and working poor should have to pay for rich lawbreaking freeloading a-holes.
"and the rest of us have to make up the difference."
Actually, we don't "have" to. We should keep cutting spending.
'But dmarks does not care... which is another example of how he hates the middle class..."
Actually, I don't. I don't want ANYONE overtaxes.
"he thinks the middle class and working poor should have to pay for rich lawbreaking freeloading a-holes."
1) I want the working poor and middle class to pay less. So they'd not "pay" for this at all.
2) I advocate no lawbreaking. But it is fine with me if these people use legal means to protect their earnings from the grabbers.
"You have said (during a discussion on the minimum wage, which you opposed) that you are in favor of some welfare.."
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Jerry: I answered. Check again. Your reading comprehension must be poor today.
It won't be funny if the greedy ruling elites get their way, and the top 1% (income-wise_ of the ruled subjects are forced to move their money offshore or find other ways to avoid the tax.
funny how the America FIRST crowd always uses this as a fall back position.
Try taxing them on it since they freakin' still live here. Tax them all as income no investment or capital gains crap, income is income it is all money, quit the freakin stupid right wing word games for the super rich.
Tax all their income like the rest of the 99% get taxes, also tax all their income like the 99% get all their income taxed for SS, this would solve the SS solvency problems in a heart beat. The only thing it wouldn't do is allow wall street greed their hands on the trillions in SS funds which are locked up in US treasuries right now. a few over paid stooges who populate the dregs of the US economy would not get richer, but the rest of us would ALL be better off.
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