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Our ‘Blood-less’ Economies

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Given the inept clods who are currently in charge of our economies, it would be a doubtful proposition for them to “fix” things, even if they actually knew what the problems were. The fact that our “leaders” display not the slightest comprehension of the real, structural problems which exist in our economies obviously means zero possibility of (real) improvement.

In this respect, a simple analogy is in order. If our problems are explained to the people first, then maybe they can explain them to our “leaders”. There is no better analogy to use in “diagnosing” our economies than to equate the wealth in our economies with the blood in our bodies.

The parallels are many and obvious. Indeed, economists talk about wealth “circulating” through our economies in much the same manner that doctors speak of blood circulating through our veins and arteries. Framed in this manner, our “problem” becomes simple to identify: there is very little wealth “circulating” in our economies – mirroring the situation when our bodies have too little blood being pumped through our circulatory system.

Just as blood-deprived humans become weak and anemic, and perform far below their potential versus when they are healthy, so too our wealth-deficient economies are also performing far below potential. The “symptoms” of this problem are too numerous to list, and are most apparent in the U.S. economy – where this “anemia” has been allowed to progress to a “life-threatening” level.

Shopping malls continue to shrivel-and-die. Retailers continue to go bankrupt. House prices continue to fall. Government revenues continue to shrink, and always come in way below forecasts.  And in the “real world” the U.S. economy continues to lose jobs, with the serial-fraud of the Bureau of Labor Statistics not fooling anyone with an “IQ” in excess of their shoe size.

If there was one, single statistic which epitomizes the chronic (terminal?) anemia of the U.S. economy, a chart on U.S. “food-stamp” usage will suffice nicely.


Looking at that chart, we see a tiny bulge in 2008: this is when the U.S. government told the sheep that the U.S. economy had “bottomed”. The near 50% increase in food-stamp usage since that time is what has occurred during the mythical “U.S. economic recovery”. Not only does that chart prove unequivocally that there has been no “recovery” in the U.S. economy, but it also fits in well with our analogy.

Wealthless-Americans are sucking-up food stamps in precisely the manner we would expect anemia-victims to pop “vitamins”. While food-stamp usage (at this point) amounts to less than 15% of the population, it is the only directly visible measurement of this anemia. Plummeting house prices (after a plunge which was worse than the Great Depression), and shriveling shopping-malls are the indirect proof that this economic “anemia” extends throughout most of the U.S. economy.

These symptoms, in turn, beg another question: where did all of our wealth go? In the U.S., that answer is painfully obvious: simply look at the fat-cats at the very top. While the majority of the U.S. population suffers from life-threatening anemia, the “blood-bloated” vampires at the top are so totally over-saturated (with wealth) that it literally oozes out of them.

Right-wing economists have a term for this phenomenon: the “trickle-down theory”. In the view of these ivory-tower elitists, it is “very healthy” for all the wealth to be held by a tiny minority, while the vast majority try to subsist on the few "droplets" they shed. Thus it should hardly be surprising that these are the same intellectually-bankrupt charlatans who continue to assure Americans that not only is there a “U.S. economic recovery”, but that it continues to “strengthen”.

Regarding the soaring use of food-stamps in the U.S., the dying housing market, the relentless erosion of the entire retail sector, and three levels of government all becoming more insolvent by the minute, these “economists” have an identical means of dealing with these facts: they ignore them completely.

Freed from the encumbrance of dealing with the “real world”, the wave of born-again “Tea Party” Republicans who have swept into power tell us that they have the answer to the U.S.’s hopeless insolvency: “cut, cut, cut.” To rebut the battle-cry of these fiscal bullies, however, we must return to the real world.

Right-wing zealots ceaselessly whine about “out of control government spending”, so let’s take a look. Over the past 12 years, U.S. government spending has increased by a whopping 129%. Of course, by itself this number is totally meaningless. It only acquires meaning when provided with context (i.e. the inflation-rate), and more specifically, the real inflation rate.

A single graph from Shadowstats.com provides us with both pieces of data. We see that in the make-believe world of the U.S. CPI that U.S. prices have supposedly been increasing by roughly 2% per year. However in the “real world” (i.e. a place where people buy food and gasoline), prices have been increasing by roughly 8% per year.


(Courtesy of Shadowstats.com)

Thanks to the “magic” of compound arithmetic, over that same 12-year period, prices rose by nearly 150%. Since right-wing zealots can’t operate calculators, let me help them with the math: in real dollars, U.S. government spending has been steadily falling for the past 12 years. However, we need to divide-up this spending into two categories.

On the one hand, the U.S. government has ramped-up (in real dollars) its spending for two wars, to create-and-fund the “Department of Homeland Security”, and to subsidize the $15-trillion bail-out package for Wall Street bankers. If we take away the endless, infinite $trillions which the U.S. government has wasted on funding its empire, its fascism, and its bankers, we see that the amount of money which the U.S. government is spending on people has been plummeting lower, by somewhere close to 3% per year.

For those who consider this 3% decline per year (on people) to be a relatively trivial number, let’s provide some context. The (proposed-but-never-to-be-realized) $60 billion in “spending cuts” Republicans are currently boasting about would be less than 2% of current spending.

At the state level, the “math” of these Republican union-busters is even more pathetic. Public sector compensation has risen by approximately 59% over the 12-year period previously cited – less than half the increase in prices over that time. These Republican bullies have successfully made scapegoats out of their own workers – whose real wages have been steadily falling, not rising.

Thus after the spending of the government  (on people) has been plummeting relentlessly for more than a decade, and after real wages have been falling for 40 years (for the public and private sector), and after 10’s of millions of Americans have lost their homes and/or their jobs, the “prescription” proposed by these Republican pseudo-doctors is more “spending cuts”. This is identical to a real doctor telling a patient suffering from severe anemia that they need to go on a “strict diet”.

Such an attitude goes from being merely cruel-and-ignorant to “totally suicidal” when we look at the “big picture”. Sadly, none of the Republicans proposing all of these “spending cuts” are capable of operating calculators, so I’ll refer once again to a “real economist”: John Williams of Shadowstats.com

Mr. Williams “crunches” more numbers in a day than these Republican “budget experts” have engaged in throughout their entire lives. Williams assures us that it is mathematically impossible for the U.S. government to ever “balance the budget” through spending cuts alone, irrespective of how severe those cuts were, or for how many decades such policies were pursued.

Put another way, given the massive structural insolvency of the U.S. economy, it will continue to become more insolvent year-after-year irrespective of how much funding is cut. For example, if 100% of all U.S. government spending was eliminated except for Social Security and Medicare, the U.S. could still never balance the budget.

Given that few Americans (and no right-wingers) could ever comprehend eliminating 100%-funding of the multi-trillion dollar U.S. war-machine, obviously the “spending cuts” contemplated by Williams are more extensive than anything contemplated in the tiny minds of Republicans.

Returning to our analogy surrounding “blood”, the average human body contains more than 5 quarts. If we were to equate this to our wealth, then what we see is that roughly 80% of our population is trying to survive with only a few ounces of blood flowing throughout our entire bodies – while the “blood-bloated vampires” have somehow managed to squeeze countless gallons into their own fat carcasses.

While Republicans prescribe “a severe diet” for all of the blood-starved “little people”, they have a remarkably different attitude toward the “vampires” (who, by remarkable coincidence paid to put these shills into office). Do Republicans think that the vampires need to go on a diet?

Hardly. Their “prescription” for the vampires: a $700-billion tax cut. And in the case of the Wall Street banks, we have entities now directly (and permanently) hooked-up to the Federal Reserve “blood bank”. While there is “no blood” for those on bottom, there is infinite blood for those on top.

Collectively, Republican politicians now play the role of “Igor” to the fictional “Count Dracula”. They are “facilitators” of the most loathsome variety: lying, cheating, and betraying the people they have sworn to serve so that they can drain all of their blood – and “feed” it to their master(s).

In the real world, our economies don’t require their wealth-starved citizens to “tighten their belts” (when their belts have been involuntarily “tightened” already for decades). In the real world, there is only one policy which will make our economies stronger – rather than steadily weaker and weaker: “draining” the vampires.

Fortunately, I have already illustrated the simple (and humane) manner in which this can be accomplished: via a flat wealth-tax. Since it is none other than the ultra-wealthy themselves who have been demanding a “flat tax” system for decades, there can be no possible objection to such a positive evolution.

The numbers are simple and unequivocal. Our “blood-starved” governments haven’t been “over-spending” (except for wars/fascism/bankers). Instead, having already drained the “blood” of more than 80% of our populations, our (hollowed-out) economies now produce so little revenues that our governments are structurally insolvent – at any spending level.

We have been squeezed dry: “you cannot get blood out of a stone”. However, we can get “blood” (lots and lots of it) from the fat vampires who have been gorging themselves year-after-year-after-year.  Just as the human body cannot survive without a minimal amount of blood circulating through our bodies, so too no economy can survive without a minimal amount of wealth constantly circulating through our economies.

The mountains of wealth (amounting to the $10’s of trillions) which have been stolen and hoarded by these vampires must result in the bankruptcy of all our nations if those trillions are not re-circulated in our economies (via taxation).

The clueless, Republican fiscal-bullies who claim to have the “answers” have demonstrated nothing except their ideological tunnel-vision, and their inability to perform the simplest calculations of arithmetic.

The power of vampires to mesmerize their prey is legendary. However, when the vast majority of the U.S. population continue to allow themselves to be duped by a clumsy “Igor” then they have no one to blame but themselves.

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Jeff Nielson
...
written by Jeff Nielson, March 05, 2011
Posthumous, thank you for both your more tactful reply AND the very gratifying statement that I have enjoyed at least a little success in "changing minds".

Indeed, if there is ONE thing which could cause me to ratchet-down the rhetoric the MOST (lol), it would be the hope of "changing minds" in much larger numbers.

Posthumous
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written by Posthumous, March 05, 2011
Bob,
I myself have had "strong" Conservative convictions, for most of my adult life (a result of my upbringing...like most), and although I have "accommodated" most of my "Socialist friends" views in the past, without agreeing with them in the least; I now find myself in the novel position of having conciderable sympathy with their concerns, and much less with our present Conservative Governments.
The Governor of The Bank of England is also not very sympethetic (and much less with the Banking World) of the Political Leadership in my country.
I suggest you read thoughly, Jeffs artical "The Solution to Sovereign Insolvency" Which is a little history and some basic maths, then a offered "solution" at the end.
You may conclude that like the author, the problem is entirely "Systemic" and the system is rigged to "Bleed the bottom 98% Dry".
Jeff Nielson
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written by Jeff Nielson, March 04, 2011
Bob, while you may never read my reply (lol), your comment is perhaps the best explanation for my rhetoric.

Several times recently, we have seen opinion pieces submitted here which expressed SOME laudable sentiments - and then (without any warning) veered into "...and it's ALL the fault of the left." Indeed, you helped me validate that point by using those words yourself.

It is (as I say over and over) simple arithmetic that the pendulum has swung too far to the "right". And yet 100% of all occupants of the "right" have never been more certain that the pendulum must swing to a yet more radical extreme.

Such people are incapable of rational thought - and so this piece was NOT aimed at them. Rather it was aimed at ANGERING the apathetic MAJORITY who do not believe in such ideological extremes, since THEY are the only hope of stopping this insane Republican agenda.

You don't "reason" with zealots, you can only isolate them.
Bob
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written by Bob, March 04, 2011
To be taken seriously, your arguments should be aimed at the problem and not the partisan left or right.

The problem is $2.1 Trillion in Revenue, and $3.4 Trillion in expenditures. With no political appetite on the left to address this short fall.

In the individual states, the revenues to expenditures are going the same direction. If you have X revenues and X+ Expenditures, someones ox will be gored. Are we going to react haphazardly to every proposed cut? Add to this, the states cannot print money to mask this problem.

I normally respect your opinions, but this time your partisanship and mud throwing at random is way, way out of line.

I don't care to hear your response.

Respectfully,
Jeff Nielson
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written by Jeff Nielson, March 04, 2011
Subscriber, regarding the rhetoric, I have hurled most of the SAME words at Obama Democrats on countless occasions. If the "pitch" is even higher here, it's only because of the CARTOONISH "evil" epitomized by these mental-midgets.

As for my claim of I have "no ideology", I maintain that. I have demonstrated (unequivocally) that the pendulum has swung much, much, much too far to the "right". Obviously in such a scenario, zealots who are STILL trying to push things even further to the right are AUTOMATICALLY the worst villains.

As for my remark about "Republicans being unable to operate calculators", again this is something which is totally self-evident. If NONE of the numbers of ANY of these zealots has any validity at all (and they don't), then that is the conclusion which is strongly implied by the facts.

Claiming that people whose wages have been FALLING for DECADES are "grossly overpaid" is the position of the complete idiot, and/or the ideological zealot - since the two terms are synonymous.
0
...
written by subscriber, March 04, 2011
I am reminded of Robin Hood. The People's Friend, he managed to always stay a few steps ahead of the Sheriff of Nottingham. What got him in the end was when a scheming female cousin promised to treat him for an illness in his old age. She installed him in a room in a nunnery and slowly bled him to death! All the while he believed she was treating his illness, she was betraying him to his enemies. He died in that room, never figuring out what was going on until the very end when Little John broke in to save him, but - too late. He simply trusted the wrong person. Treachery and deceit succeeded where direct force could not.
0
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written by subscriber, March 04, 2011
For a man who fancies himself above ideology, you certainly can sling the partisan invective with the best of them: "blood-bloated” vampires"; "Right-wing economists"; "ivory-tower elitists"; "intellectually-bankrupt charlatans"; "wave of born-again “Tea Party” Republicans"; "fiscal bullies"; "Right-wing zealots ceaselessly whine "; "right-wing zealots can’t operate calculators"; "Republican union-busters"; "Republican bullies"; "Republican pseudo-doctors"; "right-wingers"; "tiny minds of Republicans"; "blood-bloated vampires [repeat]"; "fat vampires"; "clueless, Republican fiscal-bullies" - and I might have missed a few.

None of that helps your argument much at all.

On the other hand, the blood circulation analogy is a good one. I am reminded of my days as an EMT. You can replace lost blood volume with saline solution to prevent shock and circulatory collapse. But that does not mean you can replace the entire volume of blood with saline! Real blood does more than fill the veins, it is what nourishes the body and removes waste products. Our debt money is like saline solution, and when it replaces coined wealth as the circulating medium, the body begins to die. We are now well advanced in that process.
Jeff Nielson
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written by Jeff Nielson, March 03, 2011
Navderek, maybe I'm a little "dated" in my vampire-lore (given that about HALF of today's new TV programs seem to be about vampires), but in my own understanding of that "world" you're mistaken.

In fact, only SOME of the victims of vampires are transformed into vampires themselves (usually only beautiful, voluptuous women) - and they are "thralls" of the original vampire. Conversely, MOST of the victims of any vampire are merely drained and killed.

Thus in terms of the "old school" vampires, my analogy still holds: there is ONLY the small group of blood-suckers at the top - and the FEW who gain admittance to the "club" are themselves subservient to their creators.
navderek
...
written by navderek, March 03, 2011
Let me discuss this vampire analogy some more, it sounds like fun! :-)

Vampires spread like a virus and once you're a vampire you'll always be one (according to vampire mythology anyways). So by looking at the problem in this way I'm afraid were all doomed to become vampires, protecting our own little share of "blood". The "flat wealth-tax" may be the silver stake (funny that the tool is made from silver! LoL) to heal the vampire disease, but when you have vampires at the helm and in control how can you expect them to go against their own kind?

The only difference between REAL vampires and the pseudo-vampires of our current society is that our leaders are too short sighted to plan and foresee far enough into the future. While a REAL vampire may plan ahead and devise a plan to sustain human population blood supplies, the pseudo-vampires care only for their current status and immediate gratification...they have enough blood to last a few lifetimes, and because they are pseudo-vampires they really only have one lifetime! So are they worried? Not at all. Do they care? No not really.
redpill
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written by redpill, March 03, 2011
Sad to say, Jeff - but this is the bitter truth.
Sometimes I asked myself how much wealth has been destroyed by the military complex - here you normaly have no ROI - accept the cases, where other nations are blackmailed, suppressed and robbed after a lost war.

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