Ayn Rand Forecasts Economic Disaster from Collectivism & Socialism

[olias]

Quote from achilles28:

The reason the economy and political landscape is such a mess is exactly because our leaders charged with the common good have neglected their responsibility and sought re-election at the expense of a future debt and a bubble-bust cycle.

There is some validity to that. Politicians have a tendency to kick the can down the road to delay the painful decisions that must be made. But, let's get real, that statement can be made about the entire human race. Likely we would have made the same decision in their shoes.

But let's not talk like the game is over. Yes the country is in a bind, but let's deal with it. Everyone agrees that we need to get the deficit and the debt taken care of. No argument there. The argument is about the best way to do that. I've copied some stuff from economist Joseph Stiglitz. He makes sense to me. If you're too aggressive with slashing spending right now (given the weak economy/high unemployment), you will derail the entire recovery.

Let's address the deficit because it is important, but it's not the MOST important thing right now.

We have an uphill climb but I faith that our leaders will get the ship righted and we can bring that debt back down over time.

 

[achilles28]

Quote from Gabfly1:

Fair enough. However, and as an aside, would you agree that for that very same reason a laissez faire regulatory environment is equally inappropriate?

I agree that regulators are corrupted by special interests as much as lawmakers and Central Bankers are. The answer isn't more regulation. It's none. When bureaucracies or law makers are given authority to regulate industry, corporates by their nature, immediately seek to corrupt and steer those regulators to their own short-term gain (and usually, the nations loss). The point is that we need to remove all authority from Government to regulate the economy, so the possibility to corrupt bureaucrats and lawmakers doesn't exist.

A precious metal standard and market determined interest rates takes care of the Central Bank, endless wars, welfare, bailouts, pork, graft and deficit problem. And strong private property rights takes care of the rest. The free market works just fine, if you leave it alone. Problem is, we haven't enjoyed a free market in nearly 100 years. So most people mistakenly assume what we experienced up until this point, is a "free market". And they rightfully don't like it, and conclude more regulation or Government control is the answer. When in fact, that's just the thing that created the problem to begin with! People naively assume that Government and its appointees routinely act in the best interest of the Nation because after-all, that is their mandate. However, they have been doing just the opposite for a very long time. This is why the Founders crusaded on Small, limited Government. Because people in power sell out all the time, and the more power in Government hands, the more likely it perverted to the wills of corporations or individuals to the detriment of the Country. Really, this is elementary stuff the Founders saw hundreds of years ago. The thing is, human nature doesn't change. Progressives and Republicans convinced themselves somewhere down the line that humanity - at least in America - made a radically leap forward and was now somehow incorruptible and thus, their Government officials could be trusted carte blanche.. Biggest con job of all time.

 

[achilles28]

Quote from Max E. Pad:



The problem was that the fed, and the government threw fuel on the fire, and kept on pushing the inevitable bust back, further, and further, and further, until the whole thing turned into a gigantic mess which inevitably exploded. We could have had a bunch of small recessions in between, but the only thing the government and the fed ever wanted to fight was recessions, they have no interest in curbing bubbles.

Not only would we be better off today if the government hadnt tried to get involved, we also wouldnt have grossly inflated asset prices.

Somebody who gets it. Hats off to you.

What others have realized, is this 30-year asset bubble hasn't popped yet. The deficit postponed all the natural (and increasingly severe) recessions since the 80's. Problem is, we now stand at a deficit + QE equal to 13% of GDP (at least), with zero growth to show for it. That means our equilibrium point is 1300 basis points south of where we are now. And that doesn't include economic ripple-effects. Our leaders are desperate to re-inflate this bubble, but the consumer might not recover before we max out the credit card. It's been a complete game. A total con-job. The recessions since the 80's should have become increasingly severe from declining real incomes (inflation and offhsoring) + successive booms/busts. But the deficit since Ronnie, hid the terrible consequences of these destructive monetary and trade policies with hot air and borrowed cash. America really is in deep, deep trouble.

 

[achilles28]

Quote from olias:

There is some validity to that. Politicians have a tendency to kick the can down the road to delay the painful decisions that must be made. But, let's get real, that statement can be made about the entire human race. Likely we would have made the same decision in their shoes.

But let's not talk like the game is over. Yes the country is in a bind, but let's deal with it. Everyone agrees that we need to get the deficit and the debt taken care of. No argument there. The argument is about the best way to do that. I've copied some stuff from economist Joseph Stiglitz. He makes sense to me. If you're too aggressive with slashing spending right now (given the weak economy/high unemployment), you will derail the entire recovery.

Let's address the deficit because it is important, but it's not the MOST important thing right now.

We have an uphill climb but I faith that our leaders will get the ship righted and we can bring that debt back down over time.

That sounds great. But it's nothing but empty rhetoric. Seriously. The numbers don't add up. The jobs don't exist. Half our manufacturing base was exported to Chindia. The past 3 bubbles in 20 years destroyed huge amounts of private wealth. The deficit and QE juice the economy by at least 13% GDP. That means if we ended both tomorrow, the economy would contract - right off the bat - by 13%. That's 4 TIMES as much as '08 recession. Do you have any idea what the fallout of that would be? Let alone the knock-on ripple effects throughout the economy? The point I'm trying to make to the unwashed here is the 2008 recession was actually a depression. The economy really ought to have contracted upwards of 17%-20%. That's our GDP equilibrium point, as in today. 2008 didn't happen in a bubble. America has been in decline for over 30 years for just the super duper policies so many big Government bureaucrats laud today - huge spending, low interests, wars and offshoring. What concealed this rapid decline is the deficit. The deficit was ratcheted up for over 30 years to offset and mask the ensuing contractions from these wealth destructive policies. It separated cause-and-effect to make offshoring, massive job losses, bubbles-busts seem like "no big deal". Trust me, they are big BIG deal. There is nothing our leaders can do now to right the ship except pass radical reform. 100-200% tariffs against chindia, eliminate the income tax, gut entitlements and military, default/restructure on the debt, then let the chips fall. As you aptly mentioned, none of that will happen because every politician is a self-serving coward who lies to advance his own career. Country be damned. As is Obama. As was Bush. As was Clinton etc etc. The deficit is structural. It's part of our economic lifeline. Without it, this ship will list then capsize. Problem is, the credit card is nearly maxed out. America is between a rock and a hard place and time is quickly running out.,

 

[EMRGLOBAL]

The jobs don't exist.

________________________-

Your banging your head against the wall. Parasites will never understand this, as they are on the "witch's tit" in one form or another.

99ers are due for another extension.

 

[Martinghoul]

Quote from achilles28:

A precious metal standard and market determined interest rates takes care of the Central Bank, endless wars, welfare, bailouts, pork, graft and deficit problem. And strong private property rights takes care of the rest. The free market works just fine, if you leave it alone. Problem is, we haven't enjoyed a free market in nearly 100 years. So most people mistakenly assume what we experienced up until this point, is a "free market". And they rightfully don't like it, and conclude more regulation or Government control is the answer. When in fact, that's just the thing that created the problem to begin with! People naively assume that Government and its appointees routinely act in the best interest of the Nation because after-all, that is their mandate. However, they have been doing just the opposite for a very long time. This is why the Founders crusaded on Small, limited Government. Because people in power sell out all the time, and the more power in Government hands, the more likely it perverted to the wills of corporations or individuals to the detriment of the Country. Really, this is elementary stuff the Founders saw hundreds of years ago. The thing is, human nature doesn't change. Progressives and Republicans convinced themselves somewhere down the line that humanity - at least in America - made a radically leap forward and was now somehow incorruptible and thus, their Government officials could be trusted carte blanche.. Biggest con job of all time.

This is just as much of a dream as the other extreme... Unfortunately, the solution is a very tough balancing act somewhere between the two.

 

[Max E.]

Quote from achilles28:

The deficit and QE juice the economy by at least 13% GDP. That means if we ended both tomorrow, the economy would contract - right off the bat - by 13%. That's 4 TIMES as much as '08 recession. Do you have any idea what the fallout of that would be? Let alone the knock-on ripple effects throughout the economy? The point I'm trying to make to the unwashed here is the 2008 recession was actually a depression. The economy really ought to have contracted upwards of 17%-20%. That's our GDP equilibrium point, as in today.

Well said. Here is another fact that people Dont understand. We are currently running 1.5 trillion dollar deficits which means that we are borrowing 1.5 trillion per year. The interest on 1.5 trillion is 45 billion dollars per year. (based on 3% interest rates)

Even if we cut 45 billion dollars from the budget every year, we are only going to keep up with the added interest the next year, provided we continue to run 1.5 trillion dollar deficits. And then the next year it will be another 45 billion in added interest we need to repay each year, compound interest is currently kicking us in the teeth, 10 years from now if we keep pace on this spending level we will owe another 600 billion dollars per year, just to pay for the added interest from the dollars we borrowed in the previous ten years. That is 1 4th of all the tax dollars we are currently taking in, on a year over year basis.

So we are basically screwed either way, if we take money out of the budget, the economy collapses, if we dont, we just keep running up bigger and bigger deficits, until the whole thing collapses.

 

[TGregg]

Quote from Max E. Pad:

Here is another fact that people Dont understand. We are currently running 1.5 trillion dollar deficits which means that we are borrowing 1.5 trillion per year. The interest on 1.5 trillion is 45 billion dollars per year. (based on 3% interest rates)

<img src="http://www.cartoonistgroup.com/properties/benson/art_images/cg4dae74655091f.jpg">

 

[piezoe]

Quote from achilles28:

I agree that regulators are corrupted by special interests as much as lawmakers and Central Bankers are. The answer isn't more regulation. It's none. When bureaucracies or law makers are given authority to regulate industry, corporates by their nature, immediately seek to corrupt and steer those regulators to their own short-term gain (and usually, the nations loss). The point is that we need to remove all authority from Government to regulate the economy, so the possibility to corrupt bureaucrats and lawmakers doesn't exist.

A precious metal standard and market determined interest rates takes care of the Central Bank, endless wars, welfare, bailouts, pork, graft and deficit problem. And strong private property rights takes care of the rest. The free market works just fine, if you leave it alone. Problem is, we haven't enjoyed a free market in nearly 100 years. So most people mistakenly assume what we experienced up until this point, is a "free market". And they rightfully don't like it, and conclude more regulation or Government control is the answer. When in fact, that's just the thing that created the problem to begin with! People naively assume that Government and its appointees routinely act in the best interest of the Nation because after-all, that is their mandate. However, they have been doing just the opposite for a very long time. This is why the Founders crusaded on Small, limited Government. Because people in power sell out all the time, and the more power in Government hands, the more likely it perverted to the wills of corporations or individuals to the detriment of the Country. Really, this is elementary stuff the Founders saw hundreds of years ago. The thing is, human nature doesn't change. Progressives and Republicans convinced themselves somewhere down the line that humanity - at least in America - made a radically leap forward and was now somehow incorruptible and thus, their Government officials could be trusted carte blanche.. Biggest con job of all time.

Achilles, you seem to be advocating capitalism rather than socialism, but if so, you're making very little sense. Well, no sense at all really. You seem to have somehow confused the concept of a "free market" with "capitalism".

In practice, these are opposites! Free market capitalism without regulation is an oxymoron! Real capitalists are reviled by the very idea of free markets, and if left unfettered will of course do all in their power to eliminate or weaken competition, and to establish cartels and monopolies. As a good, red-blooded capitalist, I know I certainly would, if I'm allowed to get away with it.

Don't get me wrong though, the basic definition of capitalism, where capital and the means of production are in private hands, does not require monopolies and cartels, nor even the elimination of competition. But left unfettered, without regulation, capitalism will become what we call corporatism and the second and third definitions of capitalism you will find in most dictionaries will be what you will experience.

In an atmosphere of "[no] regulation" that you propose, it is impossible to have capitalism that does not degenerate into corporatism and corruption.

Sorry to say, your statement: "The free market works just fine, if you leave it alone " is utter nonsense!!!

 

[plyka]

Quote from startraitor:

<iframe width="425" height="349" src="http://www.youtube.com/embed/CeTfUot51io" frameborder="0" allowfullscreen></iframe>

This is the middle clip of a 3 part interview, just search youtube if you want to see the other 2.

I must mention that she looked so crazy in that video, her eyes darting from left to right, the crazy look, etc.

That said, she has a great mixture of understanding and the abiliity to debate properly. If you listen to say, Ron Paul, he has the same views, basically. However, Ayn Rand is such a better communicator, she not only understands all the issues, as Ron Paul does, but she is able to communicate that understanding perfectly. She absolutely dominated that interview with Wallace. Ron Paul in the same place would not have been able to do it.

For people who believe in capitalism and freedom, they need a better communicator in the role that Ron Paul is currently playing. He gets flustered and he has very limited debating skills that when he goes up against wily foes, they know how to "beat" him in their interviews. No one would have been able to do the same with Rand, unless they limited her time to respond by attempting to talk over her, as a guy like O'reilly would today.