The world-wide austerity scam!

Yesterday's market crash should wake up some to the reality that the obsession with austerity and debt and deficits won’t really save the economies here in the US or world-wide.

Interestingly, we can imagine what the market would have done if the tea party terrorists had plunged America into default. Indeed, the 500 point plunge may have been tripled, and it just goes to show us the insane recklessness of the tea party and its republican alleys.

Most economists other than doctrinaire conservative dogmatists have been telling us for the last few years or so, as the economy plunged since 2008, that the belt tightening and austerity of the economies of the world was counter productive to the macro economic reality. . . . Budget deficits and debt are not and have not been and have never been the cause of depressions or recessions and to plunge the world economies into austerity in the midst of a depression is insanity and has always—time and again— deepened the depression or recession as it is doing again now.

www.politicususa.com...

“Back in the Great Depression, President Roosevelt thought it was necessary to reinvest in our country and put Americans to work building our nation’s infrastructure. His programs put thousands of people to work, and increased the country’s workforce. The Republican party back then, much like today, pushed for austerity measures. The national debt was too high. We couldn’t afford to do these things, is what told President Roosevelt. FDR gave the GOP what they wanted and decreased spending in 1937. What happened next is exactly what happens to all economies when the cash flow stops moving, it dips into a recession or worse”

“It is starting to look like 1937 all over again. As the table below indicates, the economy made a significant recovery after hitting bottom in 1932, when real gross domestic product fell 13 percent. The contraction moderated considerably in 1933, and in 1934 growth was robust, with real G.D.P. rising 11 percent. Growth was also strong in 1935 and 1936, which brought the unemployment rate down more than half from its peak and relieved the devastating deflation that was at the root of the economy’s problems”

“

By 1937, President Roosevelt and the Federal Reserve thought self-sustaining growth had been restored and began worrying about unwinding the fiscal and monetary stimulus, which they thought would become a drag on growth and a source of inflation. There was also a strong desire to return to normality, in both monetary and fiscal policy

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On the fiscal side, Roosevelt was under pressure from his Treasury secretary, Henry Morgenthau, to balance the budget. Like many conservatives today, Mr. Morgenthau worried obsessively about business confidence and was convinced that balancing the budget would be expansionary. In the words of the historian John Morton Blum, Mr. Morgenthau said he believed recovery “depended on the willingness of business to increase investments, and this in turn was a function of business confidence,” adding, “In his view only a balanced budget could sustain that confidence.”

Due to FDR caving to GOP demands back then, much like President Obama today, the gross domestic product plunged, 3.4 percent in 1938, and the unemployment rate rose to 12.5 percent from 9.2 percent in 1937.

It seems we are about to repeat this scenario again. The GOP has forced the President’s hand to make dramatic cuts because of the looming debt ceiling default. This may plunge the United States back into a deep recession that could last another year.

What happens a year from now? The Presidential election, and regardless of what the White House says, unemployment will matter in this election and the Republican Party knows that an improving economy means Obama will be re-elected and that they could also lose the House to Democrats again”

We have been hoodwinked by the worldwide conservative hysteria that we just have to balance budgets and everything will be fine, in the face of economic history that tells us to do otherwise.

Economies in the United Kingdom, Italy, Greece, and the Iberian Peninsula, and even Israel now have all been scammed into the bankster plot to impoverish the middle class by scarring governments, who already are puppets for these slimy banksters, into initiating austere measures of extreme sacrifice for their citizens because of the machinations of the international banksters. Here in America the republican party and their new monstrous extremity—the tea party— as well the fraud and fake-progressive Barack Obama are in cahoots with the international banking gangsters to bring the previously powerful American middle class to its knees by imposing economic suicide on the American economy with austerity and budget cutting, the very opposite methodology of what is required to put out the flames of depression in the American economy.

This budget cutting and austerity now is likes asking a starving man to fast! The American economy is starving because of a lack of macro demand [due to massive unemployment and low wages] and now the obsession with debt and deficits and tax cutting will be the final nail in the coffin of the American economy—for it will reduce demand further. Indeed, this 500 point drop in the market is likely the beginning of the end, unless light can finally get through the dark veil of ignorance and deception, which the Republican tea party philosophy aided by the fraud Barack Obama and his Bankster masters, have cast over the eyes of the American people.

www.nytimes.com...

reply to post by inforeal


The main reasons why we're seeing a rollercoaster ride are:

1) No real financial reforms after the last crisis => people don't trust the industry.
2) Political poo flinging and overall horrible handling of the crisis from ALL parties => people don't believe they'll solve the issue.

Until politicians stop acting like retards (that obviously includes the TP) and real financial reforms are introduced, nothing will change.

Happy times

reply to post by inforeal


Ok whats your plan for when this amount of money fails to prop up our dead economy? The United states is going to go down its just a matter of when!

The reason that we are seeing no relief in the markets from the budget deal is that no real cuts in spending were agreed upon. Just more Washington side stepping.

The rest of the world is sick and tried of the United States just printing money with no end in sight. The United States is spending money like there is no tomorrow and where do we get this money, we just print it out of thin air, QE1,QE2,and nowQE3. This just devalues each and every other dollar in circulation, which most developed countries have as their reserve.

Trying to hang the market crash on the Tea Party, Republicans, or even the Democrats is revealing the inability to see the big picture of the interconnectedness of the world markets.

reply to post by brokedown

The reason that we are seeing no relief in the markets from the budget deal is that no real cuts in spending were agreed upon. Just more Washington side stepping.

The problem is that everyone with a brain can see that no matter how much spending is cut, it will NEVER be enough to fix the deficit. Even worse, people are completely ignoring the fact that many of the spending cuts will have a negative impact on economic growth. Why? Because if you take money from people, they can't spend it, ergo the economy doesn't benefit.

So doing only spending cuts is like complaining how tired you are from walking the past 10hrs, and whining about having to walk another 10hrs, just before shooting yourself in the foot.

The largest single-policy contributor to the deficit are the BUSH TAX CUTS. Revenue increases need to happen at the same time as spending cuts to solve this issue. Sadly, some (you know who they are) are totally against fixing tax loop holes for companies like Exxon, or increasing the tax rate for the top 1%. Why are they against it? Because the very companies and top 1% are more or less secretly sponsoring the politicial parties they follow. Just look at the Koch brothers and their relation to the TP. Anyone who believes the TP isn't bought is delusional. They're just as bought as the other parties.

Welcome to USA 2.0, where the new motto is "by the people, for corporations" rather than "by the people, for the people". Happy times

Originally posted by MrXYZ
The largest single-policy contributor to the deficit are the BUSH TAX CUTS. Revenue increases need to happen at the same time as spending cuts to solve this issue. Sadly, some (you know who they are) are totally against fixing tax loop holes for companies like Exxon, or increasing the tax rate for the top 1%.

Okay, so let's completely abolish the "Bush Tax Cuts". What exactly is that going to accomplish, in the grand scheme?

Not a damn thing, because those evil "top 1%ers" that the Dems are attempting to turn everyone against, aren't the problem or the solution. Stop buying into the class warfare tactics.

The projected 2011 deficit is $1.6 trillion... The total of the AGI for the top 1% of taxpayers is $1.685 trillion...

So, if you stole every penny earned from the top 1%, you will have only paid the deficit and still not have touched the $14.5 trillion debt.

It was announced that our debt has now surpassed our GDP. To pay off the debt would require stealing every penny earned from every man, woman and child. And what would we call that?

ETA

By the way, here are just a few of the Koch brothers' charitable donations:

New York-Presbyterian Hospital Weill Cornell: $15 million

M.D. Anderson Cancer Center: $25 million

The Hospital for Special Surgery: $26 million

Memorial Sloan-Kettering Cancer Center: $30 million

Prostate Cancer Foundation: $41 million

Deerfield Academy: $68 million

Lincoln Center's NY State Theater: $100 million

Massachusetts Institute of Technology: $139 million

www.politicsdaily.com...

Oh my god, those guys are the spawn of satan! How much did you give?

reply to post by WTFover


they would call that justice aka liberalism with the simple fact there are only 9 million millionaires and billionaires left in this country and once there gone and they will be gone because the war on the rich has been the most enduring most sucessful war every "played".

out of a country of 310 million which 165 million have jobs which means your right even if you taxed everyone altho for many millions of ameircans you cant scqueeze blood from a turnip they just run all those evil rich folk offshore just like they have ran business and finance off shore.

wealth goes to where the money is and that aint america these days.

reply to post by WTFover


I take it you haven't studied economics, because your answer is pretty ridiculous...

Okay, so let's completely abolish the "Bush Tax Cuts". What exactly is that going to accomplish, in the grand scheme?

It was meant as a temporary tax break, to stimulate the economy. It's now pretty clear that it doesn't stimulate the economy. Since the introduction of the tax breaks, more people have lost their jobs, jobs are being shipped off-shore, and they use those tax breaks to invest where the highest growth rates are (makes sense)...ASIA!

So in short, those tax breaks aren't benefiting anyone but the top 1% who already own over 90% of all wealth in the US. Their tax rate has continuously declined ever since reagan, while the tax brakets of the other 99% hasn't moved nearly as much.

But you asked what we could accomplish? It would be the largest single-policy solution to help the deficit. We would essentially stop making new deficits...in ONE GO, and by not harming economic growth.

The projected 2011 deficit is $1.6 trillion... The total of the AGI for the top 1% of taxpayers is $1.685 trillion...

I see you realize this too...it would stop us from having to increase the deficit. And even better, it would happen in a way that doesn't harm economic growth. Harming economic growth is the LAST thing you want given the crappy state of the economy.

So, if you stole every penny earned from the top 1%, you will have only paid the deficit and still not have touched the $14.5 trillion debt.

So wait...if you force the top 1% to pay their fair share, after they got tax reduction after tax reduction ever since Reagan, that's called stealing. But taking the money out of social security, the money people paid into all their life, that's NOT stealing. Suuuuuuuuure, makes total sense.

Hell, social security isn't even the problem, it's NOT the cause of the deficit, it's self funding until at least 2035!!

They did spending cuts now, and it almost collapsed the FAA!! Do you even realize what that means? Planes landing and taking off wasn't safe anymore!!

It's a FACT that lower income brakets will spend their money, therefore supporting economic growth. People who already have enough to live really really reeeeeeally well (fyi, I'm one of them, making good money), will invest their money where the returns are greatest. And that's NOT in the US right now. My money's all invested in stuff that creates ZERO economic growth for the US. Why? Because I want to make more money, just like other wealthy guys. I'm not proud of it, but that's just how it is.

People always say "spending cuts" are the way, without thinking for a second what harms economic growth more. It's a FACT that removing the Bush tax cuts will harm economic growth less...

It was announced that our debt has now surpassed our GDP. To pay off the debt would require stealing every penny earned from every man, woman and child. And what would we call that?

No it doesn't. Removing the Bush spending cuts alone would essentially stop the US from increasing their debt. Add to that fixing tax loop holes and incentives for giant corporations like Exxon (who fired more people ever since receiving those anyway...or simply shipped jobs off-shore), and voila, you got a yearly surplus again.

Of course you can cut some spending too, but saying "spending cuts alone will solve this" is beyond ridiculous. If you seriously claim that, you obviously have no clue about economics

As for the Koch brother's good donations, that's called HEDGING YOUR BETS. If you invest (and yes, this is an investment for them), you always double track and hedge your bets. That's exactly what they're doing...

If you care about the dirty tactics they are using: LINK

Sending ballot information with the the voting date printed being 2 days AFTER the actual vote is beyond wrong. They are essentially trying to undermine democracy!!

Anyway...thx for posting, but when it comes to economics you're demonstrably clueless.

When someone has taken the bait and swallowed it hook, line, and sinker it is impossible for them to see that the blame game is divide & conquer tactics. They themselves are participating in they own enslavement.

The Bush Tax cuts were wrong, I do agree, but the problem is much larger than any one incident. WE could identify wrong choices that our Government has done year after year and continues to do, but this is not the real problem either. That is just more distraction from the beast that has us in slavery, more division for the populace to focus on.

The REAL Tea Party was a grass root endeavor that scared the pants off the system. The one thing that the system FEARS the most is unity, a united populace is incapable of being controlled. So the Tea Party was marginalized by the constant onslaught of MSM propaganda, coupled with the Republican Parties effort to infiltrate and seize control, while the Democratic Party‘s effort was to demonize. The attacks against the beginnings of the Tea Party movement came from every side and without ceasing, until the Tea Party movement was crushed under the boot heal of tyranny. Yes, today the so-called Tea Party is no longer true to it’s roots, but this can be said for every political party.

So trying to blame the Tea Party or anyone else for that matter, is falling for the distraction from the true problem.

The true problem is and always has been the system itself. No matter what political party is in control, no matter who becomes president, the system remains, there is never any “Change We Can Believe In”, it is all just a lie. Every word is a lie.

The only “FIX” is to remove the system and that won’t happen. The system is protected by the very ones it enslaves.

So, What do we do ?

There are two clear choices. Remain enslaved and ensure your children are as well. Continue falling for the Conservative vs. Liberal, Republican vs. Democrat, Black vs. White, Divide & Conquer tactics. Remain distracted from the True issues that plague this nation. Drink the kool-aid, take your Prozac, turn on your TV, and await your command to what you should think and desire.

OR

Remove your own bonds, stop participating in your own enslavement.

NON COMPLIANCE is the only answer.

Originally posted by MrXYZ

The projected 2011 deficit is $1.6 trillion... The total of the AGI for the top 1% of taxpayers is $1.685 trillion...

So, if you stole every penny earned from the top 1%, you will have only paid the deficit and still not have touched the $14.5 trillion debt.

So wait...if you force the top 1% to pay their fair share, after they got tax reduction after tax reduction ever since Reagan, that's called stealing. But taking the money out of social security, the money people paid into all their life, that's NOT stealing. Suuuuuuuuure, makes total sense.

Two things...

1) Did you send your "$800K" to the IRS, last year? I mean the entire $800K? Because that is exactly what you said in that statement. I showed that It would take every penny earned by the top 1% to just pay this year's deficit and you believe that would equate to them (you) paying their fair share? Friend, I suggest some deep introspection, before you start calling others clueless.

2) Who stole the SS funds? The Koch brothers? Are you saying the "top 1%"ers stole them? Honestly, other than to attempt to deflect, I am clueless about how you arrived at a correlation between my reply and the raiding of the SS Trust Fund. But hey, nice try.

reply to post by WTFover


Heh, I don't even live in the US at the moment. I'm just concerned about this because as long as the US doesn't get its # together (just like some European countries), we won't see things getting better. And it's brutal to watch them fail so hard, because they drag other countries down with them (including the one I'm living in now). But if I lived in the US, earning my current salary, I would still be agains the tax breaks. There's others that believe the same way...call it patriotism. Sadly, not in the US though.

And of course you would have to do the same with the tax loopholes and incentives for corporations. No more incentives for companies that don't need it (Exxon for example). Since Bush came to power and introduced those tax breaks, until he left (only 8 years), those tax breaks added $2.74 TRILLIONS to the deficit. And since they're still running, we're increasing our deficit daily. Add to that the trillions lost due to corporate tax loop holes, and an the ridiculously expensive wars, and you suddenly realize why the deficit is really increasing so rapidly. Long term, this cannot work! If you really want to save the US, you would see that and do everything to stop it. Right now, no one believes the US will get their house together, and that's why we're STILL in this stupid crisis. That's why gold and the Swiss franc are still rising, investors flee into what they believe to be save havens.

The ridiculously small spending cuts now are pointless, they won't solve anything. They need to cut spending (in places that don't harm economic growth) AND raise revenues, just by looking at the figures this should be clear. They can decrease their deficit or at least stop it from increasing much further if they do all that. But given that the Bush tax cuts are the largest single-policy contributor to the deficit, they NEED to go. And by blatantly not fixing tax loop holes, they send a clear sign that they're not really willing/able to do EVERYTHING it takes to kickstart things again. Right now, they lost all trust, and the markets totally reflect that...which I'm obviously not happy about. You shouldn't be happy about it either, bad markets mean unemployment and less money

By the way, the same goes for Europe.

reply to post by brokedown


Oh, I totally agree with you there. It's not just the TP's fault, it's all of them...they are all bought. And it doesn't really matter now who's fault it is anyway, what matters most is that they start FIXING it, fast!

The blame game isni't helping anyone, on the contrary, right now it prevents real solutions.