“No Way Out” of Debt Trap, Gross Says: U.S. Living Standards Doomed to Fall

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PIMCO's Bill Gross, the manager of the world's largest bond fund, raised his bet against U.S. government-related debt in April to 4 percent from 3 percent, according to the company's website on Monday.

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http://www.reuters.com/article/2011/...7486LU20110509

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Originally Posted by MannyIsGod

Do you guys realize how little of our debt China owns?

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No shit. Just a little over 5%.

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Originally Posted by Wild Cobra

The standard of living has been slowly declining over the last several decades. No new news here....

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Oh really? Whose standard of living has declined? Americans definition of "absolutely have to have" has continued to expand every year. Houses are bigger and fancier than ever before. Cars are sexier. Fucking elementary school kids have their own cell phones. There are more labor saving appliances and gadgets every year. Where is this living standard decline that you speak of?
.

The shithole Human-Americans find themselves was NOT of their own doing. It was decades-long strategy, back to the early 70s, of the VRWC to undo social progress back to the 1920s.

The Unwisdom of Elites

By PAUL KRUGMAN

The past three years have been a disaster for most Western economies. The United States has mass long-term unemployment for the first time since the 1930s. Meanwhile, Europe’s single currency is coming apart at the seams. How did it all go so wrong?

Well, what I’ve been hearing with growing frequency from members of the policy elite — self-appointed wise men, officials, and pundits in good standing — is the claim that it’s mostly the public’s fault. The idea is that we got into this mess because voters wanted something for nothing, and weak-minded politicians catered to the electorate’s foolishness.

So this seems like a good time to point out that this blame-the-public view isn’t just self-serving, it’s dead wrong.

The fact is that what we’re experiencing right now is a top-down disaster. The policies that got us into this mess weren’t responses to public demand. They were, with few exceptions, policies championed by small groups of influential people — in many cases, the same people now lecturing the rest of us on the need to get serious. And by trying to shift the blame to the general populace, elites are ducking some much-needed reflection on their own catastrophic mistakes.

Let me focus mainly on what happened in the United States, then say a few words about Europe.

These days Americans get constant lectures about the need to reduce the budget deficit. That focus in itself represents distorted priorities, since our immediate concern should be job creation. But suppose we restrict ourselves to talking about the deficit, and ask: What happened to the budget surplus the federal government had in 2000?

The answer is, three main things.

First, there were the Bush tax cuts, which added roughly $2 trillion to the national debt over the last decade.

Second, there were the wars in Iraq and Afghanistan, which added an additional $1.1 trillion or so.

And third was the Great Recession, which led both to a collapse in revenue and to a sharp rise in spending on unemployment insurance and other safety-net programs.

So who was responsible for these budget busters? It wasn’t the man in the street.

President George W. Bush cut taxes in the service of his party’s ideology, not in response to a groundswell of popular demand — and the bulk of the cuts went to a small, affluent minority.

Similarly, Mr. Bush chose to invade Iraq because that was something he and his advisers wanted to do, not because Americans were clamoring for war against a regime that had nothing to do with 9/11. In fact, it took a highly deceptive sales campaign to get Americans to support the invasion, and even so, voters were never as solidly behind the war as America’s political and pundit elite.

Finally, the Great Recession was brought on by a runaway financial sector, empowered by reckless deregulation. And who was responsible for that deregulation? Powerful people in Washington with close ties to the financial industry, that’s who. Let me give a particular shout-out to Alan Greenspan, who played a crucial role both in financial deregulation and in the passage of the Bush tax cuts — and who is now, of course, among those hectoring us about the deficit.

So it was the bad judgment of the elite, not the greediness of the common man, that caused America’s deficit. And much the same is true of the European crisis.

Needless to say, that’s not what you hear from European policy makers. The official story in Europe these days is that governments of troubled nations catered too much to the masses, promising too much to voters while collecting too little in taxes. And that is, to be fair, a reasonably accurate story for Greece. But it’s not at all what happened in Ireland and Spain, both of which had low debt and budget surpluses on the eve of the crisis.

The real story of Europe’s crisis is that leaders created a single currency, the euro, without creating the institutions that were needed to cope with booms and busts within the euro zone. And the drive for a single European currency was the ultimate top-down project, an elite vision imposed on highly reluctant voters.

Does any of this matter? Why should we be concerned about the effort to shift the blame for bad policies onto the general public?

One answer is simple accountability. People who advocated budget-busting policies during the Bush years shouldn’t be allowed to pass themselves off as deficit hawks; people who praised Ireland as a role model shouldn’t be giving lectures on responsible government.

But the larger answer, I’d argue, is that by making up stories about our current predicament that absolve the people who put us here there, we cut off any chance to learn from the crisis. We need to place the blame where it belongs, to chasten our policy elites. Otherwise, they’ll do even more damage in the years ahead.

http://www.nytimes.com/2011/05/09/op...gewanted=print

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For you illiterates who need Draw-Me-A-Picture:

http://www.cbpp.org/images/cms//12-1...6-28-10-f1.jpg

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Originally Posted by boutonski

For you illiterates who need Draw-Me-A-Picture:

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GFY you illiterate bot.

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Originally Posted by CosmicCowboy

Oh really? Whose standard of living has declined? Americans definition of "absolutely have to have" has continued to expand every year. Houses are bigger and fancier than ever before. Cars are sexier. Fucking elementary school kids have their own cell phones. There are more labor saving appliances and gadgets every year. Where is this living standard decline that you speak of?
.

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You're not serious, right? There's a big difference between being well off and being nigga rich. Everything that really matters has gone way up in price. Gone are the days of the single earner family having a nice house. Education costs are an absolute nightmare now. Which correlates more strongly with a higher standard of living: giving your kid an iPhone or being able to afford his college degree? Was medical bankruptcy a huge issue 30 years ago? Now we spend way more than anyone else on the face of the earth for our lousy medical care.

You Can't Be Serious

"Whose standard of living has declined"

household income has been stagnant since St Ronnie the Useful Fool got elected, and that even with with millions of women entering the labor force since 1980, making many households two incomes, the only way they have been able to stand still.

single male real income has actually declined since the mid'70s.

etc, etc.

WH to release statement: All of this was caused by the Bush tax cuts for quadrillionaires and gazillionaires.

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Originally Posted by baseline bum

You're not serious, right? There's a big difference between being well off and being nigga rich. Everything that really matters has gone way up in price. Gone are the days of the single earner family having a nice house. Education costs are an absolute nightmare now. Which correlates more strongly with a higher standard of living: giving your kid an iPhone or being able to afford his college degree? Was medical bankruptcy a huge issue 30 years ago? Now we spend way more than anyone else on the face of the earth for our lousy medical care.

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I AM serious. I can remember when my "middle class" aunts and uncles all lived in 1000sf houses with no air conditioning and one bathroom and both adults worked. They shared a car and cooked all their meals at home. Eating out was a once a month "special" treat.

Compare that to what a middle class household thinks they have to have now.

What do you guys call 'middle-class' these days exactly?

Both my wife and I work, but we just aren't even close to being able to purchase a house, even a shitty one, in this area...

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Originally Posted by DarrinS

WH to release statement: All of this was caused by the Bush tax cuts for quadrillionaires and gazillionaires.

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the Repug tax cuts going back to St Ronnie were part of the cause of the revenue crisis, as intended to "drown govt in a bathtub", aka, "starving the beast" (so it won't get in the way of the VRWC raping and pillaging people, the environment, the economy)

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Originally Posted by CosmicCowboy

Oh really? Whose standard of living has declined? Americans definition of "absolutely have to have" has continued to expand every year. Houses are bigger and fancier than ever before. Cars are sexier. Fucking elementary school kids have their own cell phones. There are more labor saving appliances and gadgets every year. Where is this living standard decline that you speak of?
.

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And it's taking both adults working to have that on average instead of one.

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Originally Posted by CosmicCowboy

I AM serious. I can remember when my "middle class" aunts and uncles all lived in 1000sf houses with no air conditioning and one bathroom and both adults worked. They shared a car and cooked all their meals at home. Eating out was a once a month "special" treat.

Compare that to what a middle class household thinks they have to have now.

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That was how I grew up, but rather poor. Our house was larger and we were below middle class. My father didn't make much but could buying a 4 bdrm house. That same house today, I cant afford and I am better of than he was then.

Technological advances skews the value of our work. Microwave ovens for example when they were new were 5 times what they cost today, or more. Look at the basics like food, housing, and gas prices.

When I was out of High School, the 2 bdrm house I rented with basement was 47.6 x minimum hourly wage. Today, smaller apartments are 103.4 x minimum wage, and a similar house, over 150 times. It seems to me houses are about 3x what they were in rent vs. minimum wage. To buy one, relative to minimum wage changes, it seems like similar houses are about 6x as much.

Anyway, that's what I see here in Oregon.

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Originally Posted by CosmicCowboy

I AM serious. I can remember when my "middle class" aunts and uncles all lived in 1000sf houses with no air conditioning and one bathroom and both adults worked. They shared a car and cooked all their meals at home. Eating out was a once a month "special" treat.

Compare that to what a middle class household thinks they have to have now.

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1940 standard of living > 1840 standard of living

1960 standard of living > 1940 standard of living

1980 standard of living > 1960 standard of living

2000 standard of living = 1980 standard of living

2020 standard of living < 1980 standard of living.

The statement that standards of living are dropping is not so much that we are really going to slide back to 1940. It is simply that this is the first time when standards of living have *not* gotten better than the generation before, and don't look to be better.

You have a point that things are better now than they were 40+ years ago, and people have new "must-haves", but that doesn't really contradict the OP at all, if that was your meaning.

gettin a year 9 drop out to be president = fail

color guy combo breaker to be president = fail

lol if a female pres is next in line = fail

i dont think any future president is going to fix ur current problems and foreseeable future, if the senate is continue run by clowns after their self interest and not the interest of the people that got them there....

The DC political class was long ago totally disenterested in having the USA progress.

Now DC is only interested in making progress for UCA and stuffing their own pockets.

DC is completely unfixable since Human-American citizens have no power to oppose the UCA kleptocratic plutocracy/corporatocracy. Barry, Mr Yes-We-Can-Change, is the perfect example why the DC disaster is hopeless.

CBPP has updated their wherefrom-the-deficit chart which shows how VRWC policies ran the country into a deficit shithole:

http://www.cbpp.org/images/cms//5-10-11bud-f1.jpg

http://www.cbpp.org/cms/index.cfm?fa...source=twitter

Note, the govt pays taxpayer cash to UCA. If taxpayer cash is insufficient, then taxpayers get stuck with debt + interest.

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Originally Posted by boutons_deux

CBPP has updated their wherefrom-the-deficit chart which shows how VRWC policies ran the country into a deficit shithole:

http://www.cbpp.org/images/cms//5-10-11bud-f1.jpg

http://www.cbpp.org/cms/index.cfm?fa...source=twitter

Note, the govt pays taxpayer cash to UCA. If taxpayer cash is insufficient, then taxpayers get stuck with debt + interest.

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lol @ cbpp.org

Someone should do something about those Obama tax cuts.

Repugs extorted extension of THEIR tax cuts by threatening to block extension of unemployment benefits. To keep the rich getting richer and richer, the Repugs were ready to fuck over the people unemployed by the VRWC's Great Bankster Depression.

:rollin

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Originally Posted by boutons_deux

Repugs extorted extension of THEIR tax cuts by threatening to block extension of unemployment benefits. To keep the rich getting richer and richer, the Repugs were ready to fuck over the people unemployed by the VRWC's Great Bankster Depression.

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Such bullshit. If the "repugs" truly had that much power Obamacare never would have passed.

republicans = democrats = like the Bush tax cuts

Repugs, Blue Dog dems, corporate lobbyists fucked up health care reform, not Obama.

Hell Freezes Over As Wall Street Calls For Tax Increases

In a stunning admission of the obvious, a majority of Wall Street bond dealers believe spending cuts alone cannot solve the U.S. budget deficit and tax increases must be part of the mix.

http://www.politicususa.com/en/wall-street-taxes

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Originally Posted by boutons_deux

Hell Freezes Over As Wall Street Calls For Tax Increases

In a stunning admission of the obvious, a majority of Wall Street bond dealers believe spending cuts alone cannot solve the U.S. budget deficit and tax increases must be part of the mix.

http://www.politicususa.com/en/wall-street-taxes

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WTF? The VWRC strikes again!