New Warning predicts "Sundown in America"

HI all,
Wether this is the last or first day of your week i have an article i am presenting to all because i beleive it has an important message, and even though the writing is clearly on the wall here ( and has been for a long time ), this is new warning from a veteran in politics and economics.

Yesterday an essay was published in the New York TImes by David A. Stockman

As you can see from the link above he has many years of experience, something i always take into consideration when heeding advise. Which in this case is more of a dire warning to any willing to listen.

NYT Essay
In this piece titled : State-Wrecked: The Corruption of Capitalism in America, Stockman gives his reasoning for the coming collapse of the American economic system in thorough detail and poingant narrative...

Since the S.&P. 500 first reached its current level, in March 2000, the mad money printers at the Federal Reserve have expanded their balance sheet sixfold (to $3.2 trillion from $500 billion). Yet during that stretch, economic output has grown by an average of 1.7 percent a year (the slowest since the Civil War); real business investment has crawled forward at only 0.8 percent per year; and the payroll job count has crept up at a negligible 0.1 percent annually. Real median family income growth has dropped 8 percent, and the number of full-time middle class jobs, 6 percent. The real net worth of the “bottom” 90 percent has dropped by one-fourth. The number of food stamp and disability aid recipients has more than doubled, to 59 million, about one in five Americans.

The culprits are bipartisan, though you’d never guess that from the blather that passes for political discourse these days.

Stockmans lengthy depiction of our current situation entails questionable actions and lack thereof from Roosevelt's economic decisions of the 1930's, to Johnson, Nixon, Reagan and on to state that " the White House, Congress and the Fed, under Mr. Bush and then President Obama, made a series of desperate, reckless maneuvers..."
Moving on to reveal how " Self-titled fiscal hawks like Paul D. Ryan"

are terrified of telling the truth: that the 10-year deficit is actually $15 trillion to $20 trillion, far larger than the Congressional Budget Office’s estimate of $7 trillion. Its latest forecast, which imagines 16.4 million new jobs in the next decade, compared with only 2.5 million in the last 10 years...

More concerning are the Global implications of all these monetary actions as outlined further in the article....

The future is bleak. The greatest construction boom in recorded history — China’s money dump on infrastructure over the last 15 years — is slowing. Brazil, India, Russia, Turkey, South Africa and all the other growing middle-income nations cannot make up for the shortfall in demand. The American machinery of monetary and fiscal stimulus has reached its limits. Japan is sinking into old-age bankruptcy and Europe into welfare-state senescence. The new rulers enthroned in Beijing last year know that after two decades of wild lending, speculation and building, even they will face a day of reckoning, too.

Though there is a glimmer of hope that changes could be made though the suggestions made by Mr. Stockman are radical ( i like radical )

The way out would be so radical it can’t happen.

seems a bit pessemistic...even for me but given the details of what he thinks needs to be done it does indeed seem a reality.

It would necessitate a sweeping divorce of the state and the market economy....
...The state would need to get out of the business of imperial hubris, economic uplift and social insurance and shift its focus to managing and financing an effective, affordable, means-tested safety net.

Prying them apart would entail sweeping constitutional surgery: amendments to give the president and members of Congress a single six-year term, with no re-election...
..and prohibiting, for life, lobbying by anyone who has been on a legislative or executive payroll..
... putting the great Wall Street banks out in the cold to compete as at-risk free enterprises, without access to cheap Fed loans or deposit insurance. Banks would be able to take deposits and make commercial loans, but be banned from trading, underwriting and money management in all its forms.

It would require, finally, benching the Fed’s central planners, and restoring the central bank’s original mission: to provide liquidity in times of crisis but never to buy government debt or try to micromanage the economy. Getting the Fed out of the financial markets is the only way to put free markets and genuine wealth creation back into capitalism.

And while the next scentence states explicitly "That, of course, will never happen" he concludes his Essay detailing the very stark reasoning behind the essay...

The United States is broke — fiscally, morally, intellectually — and the Fed has incited a global currency war (Japan just signed up, the Brazilians and Chinese are angry, and the German-dominated euro zone is crumbling) that will soon overwhelm it.

Given the state of affairs and the opposition to be overcome the questions remain...are Americans willing and able to make such changes?

well, it is in my personall opinion that, while the majority of Americans are probably clueless to the reality of this situation, at least there is a way out...and as little as it may seem as long long as there are some people in this country/world who are willing to put themselves and thier ideas out there like this we can keep moving towards that light at the end of the tunnel.

While Mr. Stockman does give a few years for this all to play out i think it may be happening a bit faster than that...though our politicians do like to play games.

All of these changes that need to be made in regards to our "constitutional" state of being, such as political terms and banning lobbies are necessities for our future...can these "inevitable" outcomes of economic collapse be avoided though? Probably not but if these changes can be made in time perhaps we can make a difference for our posterity.

1. I believe everything you are saying except...

There is no way out. It will happen and has to happen in order to make things right again. As with all Dictatorships, it has to fall in order to be rebuilt. Unfortunately with human history, it will repeat itself. Hopefully just a little bit better.

2. Many Americans are blind to what is going to happen.

As are many more people Globally. Canada (My home) is also blind to the facts. They don't understand that the border is just an invisible line and not a protective shield. Harper loves the NWO and Obama is his hero it seems.

Great OP and thank you for carrying the message. That's all we can do.

Peace

Originally posted by RadicalRebel
While Mr. Stockman does give a few years for this all to play out i think it may be happening a bit faster than that...though our politicians do like to play games.

Yes it is happening much faster than his prediction. I don't think his prediction took into account situations like what is happening in Cyprus not only occurring, but being used as a blue print for other nations to follow.

There are many things that are about to come to a head I think, and even though the outcome does not look pleasant, it might finally get things headed in the right direction after it's all said and done.

ETA:

This is one of my favorite paragraphs from his essay:

As the federal government and its central-bank sidekick, the Fed, have groped for one goal after another — smoothing out the business cycle, minimizing inflation and unemployment at the same time, rolling out a giant social insurance blanket, promoting homeownership, subsidizing medical care, propping up old industries (agriculture, automobiles) and fostering new ones (“clean” energy, biotechnology) and, above all, bailing out Wall Street — they have now succumbed to overload, overreach and outside capture by powerful interests. The modern Keynesian state is broke, paralyzed and mired in empty ritual incantations about stimulating “demand,” even as it fosters a mutant crony capitalism that periodically lavishes the top 1 percent with speculative windfalls.

So sad because it's so true.

I was rather surprised to see this printed in the NYT. For many years, now, they have been towing the Obama line that our deficit is not a problem, and our financial status is solid. I suspect that the dwindling readership of the Times might finally be forcing them to loosen up the line they have been towing for the current administration.Quite bluntly, anyone with half a brain can see that we are in dire straights. One need not even be skilled at reading balance sheets. One need only travel down any city or town in America, and see all of the vacant store fronts, and abandoned homes to realize that. In addition, a country which keeps printing monopoly money and passing it off as the nation's "currency" is living in the land of make believe, whistling past the cemetery of our dead economy. In addition, it is obvious that the politicians are intent on granting some sort of citizenship promise to the illegals in this country, further forcing costs up for companies now employing them. Add to that, the financial disaster called Obamacare, and its impact on our future economy, and you have the perfect storm.
Let me give people some free financial advice,,, if you have money in the stock market, get it out as quickly as possible. A huge hurt is coming down the line, and the new crash will make the previous slide look like a minor bump in the road. I suggest you put some of your money in non-perishable necessities, as they will also be in short supply, when the companies that make them go under, as many will. Over the last several weeks, I have liquidated every stock fund that I own, so I am practicing what I preach here in this thread.

It is a reasonable assessment and direction to some of the major challenges facing the US. Having a clear and accurate picture of the problem is vital if there is to be any chance of addressing it in a viable way. There are a lot of varying figures and tweaks to the actual financial situation with many different accounting processes and procedures making for a very complex situation.

With so much than needs to be done, the primary effort should be placed on cleaning up congress. Any attempts at major reform in the current climate will just add to the problems. With lobbying akin to legalized bribery it does introduce personal gain rather that the social benefit to influence the decision making process. Better controls and justifications on how public policy is constructed will flow onto the other national problems and issues.

Came across this article being mimiced on several sites...bloomberg, businessweek, yahoo and a bunch of alt media sites, a quick google for the article name will give em all up...

Stockton warns of crash of fed-fueled bubble economy

Not really sure what to make of it, it almost sounds like its a satirical agreement of the NYT piece, it quotes Paul Krugman as saying...

that he was “disappointed” in Stockman’s “gee-whiz, context- and model-free numbers embedded in a rant -- and not even an interesting rant.”...
... “We’ve been doomed, yes doomed, ever since FDR took us off the gold standard and introduced unemployment insurance. What about those 80 years of non-doom? Just a series of lucky accidents. Now we’re really doomed. I mean it!”

Like i said...not sure how to interperet that but im going with my gut and assuming its sarcasm with intent on discrediting the NYT essay in the OP and/or David Stockman.

reply to post by RadicalRebel


I dont believe what this moron says.....during the 80's he thought that "trickle down economics" was a good thing...we need trickle up economics to get the country on the road to prosperity...if the little guy has money to spend, he spends it...if the rich have money to spend, they hoard it.....

reply to post by rangersdad

I think it may be a bit brash to disbelieve verifiable statements based on his opinion from 30 years ago, thats a long time to grow and learn.
While i dont exactly agree with trickle down economics the message he gives is about the damage already done, what that damage is inevitably going to do (and evidently aready doing), and about ideas that americans should be thinking about in order to change the path we are on to make a better future for our kids and thiers.

How exactly to we impliment "trickle up" economics without such a suggested change?

I'm surprised to see something like this in a mainstream newspaper. I think that in itself is a good sign and a step in the right direction.

But as he said, it will never happen. The people running the show are still making too much money. Our anger and resentment continue to fall on deaf ears. It's still too easy for them to ignore us outright. They placate our short attention spans with with nonsense about gay marriage and gun control, dish out the doom porn with NK ans Iran.

The people are still too comfortable, as long as Gov't. keeps patting the people on the ass saying " It will all be ok, we'll take care of it. Here have these pills and foodstamps and go back to bed." Nothing will change.

The worst part is that we keep electing the same scum over and over thinking it's going to be different this time, our guy is going to make everything better. Then they're surprised to find the same crap burning on the front porch.

No, the hole we've dug is too deep. The chance to fix it is long past. I'm not saying we should give up. But don't be fooled into thinking this is anything but losing battle. None of us are going to come out a winner in this game.

Reminds me of this old vid. It comes off across as a bit like doom porn, but hey.

There is only one thing left for america to do now, and does anybody know what that is? Start one hell of a big war. Its been used in the past and it will be used again because its the fastest way to get an economy boyant again. Its also great for dominating its people.

I made more in my investments than I did in paycheck. Bought more land and supplies all better than gold or silver . Cases of Hennessy and Jack and more kinds of smokes than I can remember. All stashed away in a cool dry place

One of the things I find rather puzzling about this thread is the fact that it has 19 flags at this point, but only 8 participants so far. This is a huge issue, regardless of whether you buy the argument or not. I guess this is emblematic of the general population, namely most people ignore the issue and hope it will go away, rather than be proactive concerning their future. Oh well, I guess I shouldn't be surprised. They can back to their "reality" and fantasy shows. The real world is a little too scary for many, I guess.

nice article indeed. one thing i see that would have to be done is removing the fed all together, there is just no way if you leave them in any kind of power, that they will not end up the same way as we are now. you cannot give thieves a free ride even if you trim their duties, they are still thieves. fractional reserve banking must end as well but like the author of this article states, that will never happen either.

this rotten cart of food must go. it's unfit for humans any longer.

I talked about this yesterday around the dinner table for easter. scared alot of family members that were blind, they now also think im crazy so there still blind.

A lot of what is said in this article is what the Austiran school of economics has been shouting from the rooftops for ages. A lot of it has been said by Ron Paul and others affiliated with the Libertarian philosophy.

And, I agree with the author. I don't mean the part about this never happening (though I do agree with that). I mostly agree with his statement that:

"The United States is broke — fiscally, morally, intellectually ..."

Originally posted by camaro68ss
...they now also think im crazy so there still blind.

edit on 1-4-2013 by camaro68ss because: (no reason given)

You are in good company, camaro68ss. I have pretty much given up on trying to explain any of this to anybody.

It's not so much that they are really blind. They could see if they were willing. The reality is so frightening to most people that they choose to close their eyes.

Originally posted by ProfEmeritus
One of the things I find rather puzzling about this thread is the fact that it has 19 flags at this point, but only 8 participants so far.

I guess, for a many people, there's just not much to add. The article says it all. The message needs to be propagated, but so many (the Austrian school, the Libertarian movement) have been saying this for so long, and nobody wants to hear it, nobody wants to believe it. The reality threatens the imaginary status quo and upsets the apple cart too much.

reply to post by SpaDe_


Key comment as regards who is to blame (hint - the love of money is the root of all evil)

and, above all, bailing out Wall Street — they have now succumbed to overload, overreach and outside capture by powerful interests. The modern Keynesian state is broke, paralyzed and mired in empty ritual incantations about stimulating “demand,” even as it fosters a mutant crony capitalism that periodically lavishes the top 1 percent with speculative windfalls.

What a mess. Same pattern, more or less, in Europe. Yet people believe it's just business as usual for the US/ UK..

Until the blackouts begin...