Government Spending

Five Budgets for a Broke-Down and Busted Amerika

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As someone who's only a week away from retirement—just like Robert DeNiro in the incredibly shitty movie The Score, I plan to pull one last job and then retire to Montreal (or was it Quebec City?) to run a jazz club (or was it a Pilates studio?)!—I don't know how I keep getting pulled back into this shit. But here you go, a quick rundown of the various federal budget plans out there:

President Obama wants to spend $3.7 trillion next year and $5.7 trillion in 2021.

Rep. Paul Ryan (R-Wis.) wants to spend $3.6 trillion next year and $4.7 trillion in 2021.

The Republican Study Committee (RSC) wants to spend $3.6 trillion next year and $4.2 trillion in 2021.

Rand Paul wants to spend $3.7 trillion next year and $3.4 trillion in 2016.

The Congressional Progressive Caucus (CPC) has a "People's Budget" outline that, in keeping with representing a math-averse nation, doesn't include anything as straightforward as a series of annual-outlay numbers, though it does promise that outlays and revenues in 2021 will each equal 22.3 percent of GDP.

Then there's the plan that Veronique de Rugy and I cooked up: The 19 percent solution, in which federal spending is kept at 19 percent of GDP, which is what the CBO alternative scenario (known for its realism) said federal revenues would equal in 2020. We started writing about this last year, so our time frame is a bit different than the above. Given our druthers, we'd spend $3.3 trillion next year and $3.7 trillion in 2020 (in current 2010 dollars). That would mean total expenditures and total revenue would be in rough alignment though spending as a percentage of GDP would still be higher than it was in Bill Clinton's last budget (the cheapskate Clinton spent just 18.2 percent of GDP in his last year!).

When you look at the above figures, one thing seems pretty clear (to me, at least). Most of these scenarios are Sears Wish Books, plain and simple. Start at the top, with Obama's. By his own count, that $5.7 trillion of spending amounts to 23.1 percent of GDP in 2021. The CPC comes in at 22.3 percent of GDP. Paul Ryan comes in at 19.9 percent. Gillespie-de Rugy comes in at 19 percent. Rand Paul comes in at 18.7 percent and the RSC comes in at 18 percent.

The historic average of revenue from all sources from 1950 through 2010 was 17.8 percent. As noted previously, the CBO's alternative scenario projects that if taxes stay basically the same as they are now, revenue will equal 19 percent of GDP a decade down the road. To put that in perspective, the single highest year of revenue in the 20th century was 2000, when revenue came in at 20.6 percent of GDP and the best five-year average for revenue (1997-2001) comes in at 19.8 percent of GDP. 

If balancing the budget is important (and it is), there's a strong argument for not spending more (and preferably less) than about $3.7 trillion come the start of the next decade. That's for everything—debt, entitlements, defense, you name it. A short while ago, it was common to talk about pushing a "reset" button when it came to foreign policy. That would be swell, but the same thing has to happen when it comes to government spending. There is simply no way to pay for budgets that spend, on average, 20.5 percent (Ryan's average over 10 years) or 22.3 percent or 23 percent of GDP. If there was, somebody would have found it already. That's the historical record speaking: In basically the best economic year of the 20th century, under a tax system that had hiked rates on high-income earners and cut rates on capital gains, we were able to pull one year at 20.6 percent.

And you can't stress enough that after that historic five-year average in the second Clinton term, even Al Gore was calling for tax cuts (and, incidentally, less new spending than Candidate Bush). Revenue surges, real and imagined (and they are mostly the latter) get pissed away pretty quickly. And even borrowed dollars just don't go that far in covering what people need: Federal outlays have increased over 60 percent in real dollars since Bill Clinton left office and what do we have to show for the splurge? How is it that we were able to feed the hungry and clothe the poor and care for the sick back when Bubba was in office and spending far fewer dollars relative to GDP?

While the Rand Pauls and RSCs of the world are considered draconian and out-of-hand and nihilistic by many not just on the left but in the center of politics, they are still spendthrifts relative to Bill Clinton. Jesus Christ, what a world we live in that a return to 2000's standard of living is seen as the equivalent of going back to Hooverville, USA.

NPR interviewed me for the weekend edition of All Things Considered. The show aired today and audio is up. Go here for a transcript and sound.

Veronique de Rugy and I discussed Ryan's budget plan on Stossel last Thursday. Here's a clip:

NEXT: Off the Hook

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  1. And how will merely trimming government spending to Clinton levels create Clinton-era prosperity? Might there be other factors at play, such as the state of the economy? (And what about Clinton-era tax rates?) We’re supposed to accept Gillespie’s arbitrarily-chosen figures based on the premise that government debt is the cause of all our problems, and fixing it the solution. But basic economics shows that lowering government spending will lower employment, and that leads to decreased demand. It’s quite clearly not the solution. And debt is only worth worrying about above all else if there is some debt crisis looming. Maybe there is, but there’s no evidence of it, and at any rate we have to make sure we’re doing the things that actually lead to debt reduction long-term. Policy that keeps unemployment high has the opposite effect. Unemployment is the crisis we should be worrying about, and while I am not shocked by Republicans making the cynical claim that reducing government debt will lead to more jobs, I expect libertarians can see this contradictory ludicrousness for what it is.

    1. Remain calm! All is well!!

    2. “But basic economics shows that lowering government spending will lower employment” — No it doesn’t.

      1. OK smart guy you tell me, how does taking money out of the economy increase employment?

        1. Because no one has been able to demonstrate that the multiplier is positive.

        2. reducing government spending means putting money back into the economy. I guess you could beleive in the money fairy, but in the real world, most people who loan you something expect to be repaid. So when the govt borrows, the repayment becomes a claim on the future economy’s productive allocation of capital…unless you think the govt is the best source of decisions on productive allocation of capital. But I assume you know better, so this isn’t really for your benefit.

          1. Current debt is the cheapest debt we’re ever gonna get. If it can service reducing unemployment, then future growth will mitigate long-term debt a lot more than randomly slashing spending now and keeping unemployment high. I’m not sure how you justify the claim that lowering government spending puts money back into the economy.

            Of course your claim that the free market is the best allocator of resources is completely unfalsifiable, since no matter the outcome, it must be the best, since the free market did it. Do consequences such as employment rates and poverty and such even enter into this determination, or is it really completely circular?

            1. Current debt is the cheapest debt we’re ever gonna get.

              And someday (soon, since most of our current debt is short-term) its gonna roll over into debt that isn’t so cheap.

              1. What could possible go wrong trying to run an economy like an ARM?

                1. Comment of the Yesterday!

              2. But the point is addressing the debt by slashing spending when aggregate demand is low and unemployment is high means you’ll be forever chasing the debt, which keeps rising because revenues keep getting lower. It’s a simple matter of long-term vs. short-term thinking.

                1. Tony|4.10.11 @ 8:19PM|#
                  “…It’s a simple matter of long-term vs. short-term thinking…”

                  You’re right about that. Unfortunately, your ‘solution’ (and general ignorance) favor a short term ‘gain’ at the expense of the long term.
                  See how ‘cash for clunkers’ worked?

            2. Lowering spending now, reduces the economy’s burden later…it’s a long term view versus an election cycle view. The problem with cheap current debt is just that…it’s only cheap currently…unless you think you know when it will get expensive? How does inflation factor into your definition of debt?

              When the govt can’t fund its debt at current costs, what happens to unemployment and safety net programs? I don;t think anyone proposing to spend 3.6T in a year (Rand Paul) is recommending ‘slashing’ spending in the short term. Do you call that slashing spending?

              I have been unemployed. I accept that as part of the natural cycle of things. Until we’re willing to let the creative destruction of the bilions of people making decisions (i.e., the market) take its course, men like you will continue to tell us that there are a few elites in government who know best what needs to be done.

              1. How does inflation factor into your definition of debt?

                Well inflation makes current debt easier to bear if it remains nominally the same. But the point is there is no evidence of runaway inflation around the corner. The whole reason we have monetary policy is to temper these things anyway, and of modern examples where debt was huge as a proportion of GDP (120% in the case of post-WWII America), governments have not resorted to inflation to deal with it. (Though some countries have inflated their way out of debt, and some argue for a modest increase in inflation now to encourage lending and reduce the burden of private debt.)

                Until we’re willing to let the creative destruction of the bilions of people making decisions (i.e., the market) take its course, men like you will continue to tell us that there are a few elites in government who know best what needs to be done.

                “Creative destruction” is how you might describe the wild boom-and-bust cycles of a free market economy, and it creates a lot of misery, and it’s not the best we can do. You seem to want the boom without the inevitable bust. I think the cyclical harm this causes far outweighs any benefits.

                1. Tony|4.10.11 @ 8:43PM|#
                  “…The whole reason we have monetary policy is to temper these things anyway…”

                  And it’s worked so WELL!
                  Just like the policy to get folks to buy homes they can’t afford.

                2. Tony:
                  “Creative destruction” is how you might describe the wild boom-and-bust cycles of a free market economy, and it creates a lot of misery,”

                  You stupid shit! You shouldn’t use terms you pick up from brain-dead lefty sites until you learn what they mean!
                  For our amusement, please tell us your brain-dead interpretation of the “tragedy of the commons” again. We need a good laugh tonight.

                3. But the point is there is no evidence of runaway inflation around the corner.

                  Oil is plentiful and demand for it is down.

                  Hmmm I wonder why gas is near $4 a gallon.

                  Oh yeah INFLATION!

        3. You do know who’s taking the money out of the economy now…don’t you?

            1. Tony|4.10.11 @ 8:58PM|#
              “Banks?”

              Spoof?
              Or Tony once again proving his ignorance?
              I can’t tell.

              1. Let’s lay our cards on the table, shall we?

                My rich daddy needs to suffer, for reasons I’m far too embittered about to ever verbalize coherently.

                I, plainly, lack the sack requisite to administering said punishment myself… so: it therefore becomes a fair and decent government’s responsibility to grind his white, male, heteronormative face into the dirt for me, as a shining example of progressive social justice.

                Why do you hate social justice, sevo?

        4. Will definitely be creating jobs with the Obama perpetual-war policy in effect. Invest in defense stocks now!

        5. Tony|4.10.11 @ 7:49PM|#
          “OK smart guy you tell me, how does taking money out of the economy increase employment?”

          OK, asshole, you tell me how does increasing government spending put money into the economy?

        6. Tony, I’m gonna go out on a limb and suggest you’ve never owned a business. Here’s the thing, when the financial “crisis” hit, the real economy–as personified by everything from attorneys to manufacturing to restaurants–got smacked around. Hard. So hard, many folks lost their jobs, never to return to the workforce (taking either Social Security or Disability or two+ years of unemployment.)

          In addition to bailing out the banks, the gubmint borrowed/printed a lot of dough to create “shovel-ready jobs,” spent scads on new bureaucracies, and made all kinds of silly efforts to keep the housing market from finding a bottom (mostly to preserve property tax revenues).

          Government borrowing did nothing to create “shovel-ready jobs”–all that happened was, states used “stimulus” money to pay for projects already planned, and the rest to save six-figure deputy assistant paper shovelers from the uncaring chaos that is the private sector and, given what these folks were actually qualified for, the Wendy’s drive-thru.

          You ask why reducing funds for government will lead to a decrease in unemployment, well, here’s the thing: those government paper-shovelers, many of whom have the “right” to send a dog-killing swat team to your place of business, take two things from a prospective employer. The first is money, in the form of taxation direct and other; the second is time. I have to fill out a ton of forms, monitor new regulations, look into health care rules, get multiple forms of ID, pay withholding taxes, etc. And the pace of regulation is “accelerating,” as so many of those government employees are “entrepreneurial,” constantly looking for new things about my business that they can regulate.

          Take me personally. I publish books. There’s a new trend in my industry: solvent small presses are opening up their own bookstores, partially filling the void that’s left as Borders goes under and B&N + BooksaMillion flounder. Added incentives: the outdoor book festivals I used to travel to have been killed by the economy; there’s vacant space in my neighborhood; and my local Borders flagship is closing.

          As I’m very interested in controlling more of the retail channel for my wares, rather than just being Amazon’s bitch, the idea of taking my (locally popular) titles into my downtown area, selling similar books from other publishers, and having enough of a mass-market presence to appease the lunchtime crowd has a certain appeal. Given certain other factors (like readings), I’d need to hire at least five people*, full and part-time, ‘cuz we’ll stay open at least 12 hours a day. Every day.

          But: In addition to the still-exorbitant rents ($27 per square foot, are you shitting me?), I’ll need a host of permits–sales, construction, OSHA–have to assemble all kinds of documentation on my employees, to prove that they’re legally here to sell printed works, because terror, pay thousands in upfront fees, and of course make sure my book-stocking design is fully accessible and in keeping with the opinions of my local architectural committee (or whatever you call the jackasses who’ve chased away grocery store chains, ‘cuz they know better than Harris Teeter where produce and milk should be placed.) And let’s not get into whether poetry readings are “live performances,” requiring additional permits.

          If I want to prove my independence from Amazon, in addition to looking at spending nearly $100k** over 12 months, just to get my bookstore running, I’ve got all kinds of little putzes who will be able to harass, fine and possibly jail me, should I not go along with their bureaucratic whims, because after all, my time isn’t worth anything.

          Or, I can pay a couple of guys in India a fraction of that amount to build me an Android app,*** that’ll let me better sell my ebooks direct to Nook+Smartphone users, escrow the total amount, risk no jail time, and indeed offshore my servers and all of my direct sales in a day’s time if it comes to that.

          Needless to say, in today’s regulatory climate, I’ve made the same decision most other businesses have made: be extremely productive stateside while hiring overseas (also have an editor in Melbourne, OZ.)

          Gee, Tony, what do you think? Are my 5+ potential U.S. employees better served by the excess government spending? I know for a fact that a couple of those regulators in my community have received DHS grants. Or, do you think we should cut back, just a little bit, on the regulations (and time demands) they’re imposing on business? And quit spending my money to do it. And quit hiring six-figure paper pushers who exist solely to harass me and keep one of the two streets in my new Town Center a commercial wasteland of vacant storefronts? (The other street has three chain bars, one of which has already slashed its hours. Good luck opening a real bar here.)

          *When I say 5 employees, that’s an approximation. In my (private-sector) career, I was always able to juggle a host of part-timers w/ childcare needs and so forth. Interestingly, when they talk about the ‘Aughts, they note that 3 million more government jobs were created than expected, alongside 15 million fewer real jobs. Good rule of thumb might be that every new government employee causes five real jobs to disappear, but I haven’t seen enough research on this yet.

          **Adding: because it’s a “cultural enterprise,” in theory I could get loans and grants from my city to “offset” the impact of their fees and regulatory burden, especially if I put the bookstore in my wife’s name, but, you know, it took me 20 minutes to blueprint the html5 app I wanted, and roughly an hour a week since to do some IT things that make sure my programmers can do what they need to…

          ***Yes, we’ll have an IOS app too, but that market’s so in flux, it just isn’t worth mortgaging the house over. NookColor’s sold three million units and there’ll be a Kindle tablet soon.

        7. OK smart guy you tell me, how does taking money out of the economy increase employment?

          Since the government is spending 25% more per capita than it did during Clinton’s boom that must mean that our economy is at least 25% better.

          Right?

  2. We need to start talking differently about the size of the debt and unfunded liabilities so it sinks into the general public to whom numbers in the $trillions are too abstract.
    Federal government will need >$1 million per household to pay its IOUs!
    > $116 trillion =”official” debt plus money  short for future social security, medicare, etc
    Even its “official debt” of $14.2 trillion  is $123,754 per household!
    Details at http://StopNationalDebt.com
    Facebook at http://www.facebook.com/pages/…..0177811775

  3. Please go to http://www.votizen.com/ which lets registered voters contact their congressmen (confirming to the congressmen you are a registered voter probably and not a spammer from another state). Tell them to balance the budget *now*, that $1million per household to pay federal IOUs is too much! http://www.StopNationalDebt.com links to it, so tell everyone to visit there! Or try ContactingTheCongress.org which lets you find direct email/contact forms.

  4. You’re retiring next week?

    1. I was wondering that myself.

      1. I’m thinking up Reason unfunded pension liability jokes as we speak.

  5. What percentage of GDP does the “government of Somalia” spend?

    That would seem to be the right target.

    1. Somalia’s GDP is $974M…I’m having a hard time finding what the TFG (Somalia’s internationally recognized govt) spends per year.

  6. The national debt is a fight against the powers of mankind in the war against the womankind. The kind of thing that does this is a deep hated of love and life that causes me to feel bad about the way our government is eating our future with a big-ass spoon. The government is slamming our assholes with a life-hating zeal that rapes my perception of the way Tiger Woods is WINNING the Masters like a masturbating child trying to understand the world in a way that keeps us safe. Bush knew this, which is the reason he cut taxes for the corporate masters in the way that rapes all our children. The only way to get beyond our greed is a massive army of porno wives that allow for butt-sex. Butt-sex drips shit mixed with cum on the machines of power that control the way we spend money on various things like cigars and bottles of bourbon and butt-sex. Now, if you understand that this means that nuclear warfare destroy the massive porno industry then Gillespie excellent idea of keeping the size of the federal budget to 19% of GPD, then I’ll grant you that butt-sex won’t do a hell of a lot of good. Yet, just remember that life is worth living if the cocaine is in your nose and your dick is in the porno wife’s ass.

    Thanks.

    1. shit mixed with cum on the machines of power

      Why yes, I am running for president.

      1. Ricky-Rick, me and my buds are going to band some 7 gram cats and smoke some wood in the garage. You want to hang bizatch?!

        1. I meant “bang.” I hope that clears it up.

  7. Nick : as montrealer, I can tell you that that De Niro movie was in a Jazz Club and that in was indeed in Montreal, not Quebec. In the Vieux-Port, pour etre precis.

    Maybe I misread, but I hope you’re not actually thinking of retiring here and enjoy some peace of mind as a libertarian for serious, because believe me, you’re gonna turn crazy in this western USSR province that I unfortunaly have to call home.

    1. Isn’t Montreal in Quebec?

      1. Kansas City (one of them) is in Kansas too…

      2. there is a Quebec City in the Province of Quebec

        so montreal and quebec city are two cities in the province of quebec

        not quite as confusing as the kansas cities, but similar to NY NY versus NY

        1. New York, New York; the city so arrogant they named it twice.

    2. But Montreal does have a great nightlife and beautiful coeds.

      1. and an 18 age drinking limit, plus full contact dancing at strip clubs

        1. These are all reasons that the bachelor party I’m throwing this summer will be in Montreal.

        2. That drinking age limit is just a suggestion.

    3. Frank, We need more Libertarians in Mtl, not fewer. Lets find him a nice location. The political climate can only get better.
      …and things are slowly movnig to the right. There is a big RLQ meeting this weekend.

  8. Rand Paul wants to spend $3.7 trillion next year and $3.4 trillion in 2016.

    I’ll take it.

  9. U.S. hoi polloi are addicted to their placebos, and they will insist someone else continue to keep ’em comin’.
    Democracy is a bitch.
    Nick, When you retire, maybe we can have lunch.

  10. And debt is only worth worrying about above all else if there is some debt crisis looming.

    The other day, when I looked, interest expense this fical year (since Nov 1) was in excess of $215,000,000,000.-

    And that’s with the Fed propping up the bond market. I don’t think there is a debt crisis looming; I’m pretty sure it’s here.

  11. your claim that the free market is the best allocator of resources is completely unfalsifiable

    By George, I think he’s got it.

    1. Mr. Bernanke is running his xerox machines at 11. That should hold the [bond] wolves at bay.
      Of course with our endless deficits we should be at Brazil rates of 12%.
      http://www.bloomberg.com/marke…..ds/brazil/

    2. ewwww..
      I guess it depends on what your goals are. Profit for the elite? Sure, you’re right, hail free market.
      I say that I am my brother’s keeper, the bell tolls for me.
      Here’s what I see..
      A truly free free market = predation of the out group (how can you say otherwise?) We are all of the same species, this predation is unnatural and needs to be stopped.

  12. This is hilarious:

    http://www.balloon-juice.com/2…..meet-ikea/

    The US is now Sweden’s Mexico! A third world hell hole to outsource to, since Swedish workers would never work for such little money and so few benefits.

    In Sweden, Ikea workers make $19/hour minimum and have five weeks paid vacation. In the Danville plant? $8/hour and 12 days vacation, eight of which are chosen by the company.

    Yet another way in which Reagonomics permanently fucked this country over.

    1. Ve must go on strike, Bjorn, to protest our yobs being sent overseas. Zose Bangladeshis in America are stealing our yobs. Oh, but not to vorry, ve have a nice safety net.

      1. It is actually front-page news in Sweden. They’re utterly shocked that workers in a supposedly developed, first world country can be abused and underpaid like that.

        1. So we should end their abuse and tell IKEA to stop employing them?

          1. No, Ikea should let them form a union instead of bringing in outside corporate thugs to union bust.

            1. The jobs will end up in Malaysia anyway. Wake up out of your stupor.

            2. The Truth|4.10.11 @ 8:41PM|#
              “No, Ikea should let them form a union instead of bringing in outside corporate thugs to union bust.”

              No, we should tell everybody you’re a brain-dead ignoramus.

            3. That’s the truth, Truth.

        2. The Truth|4.10.11 @ 8:32PM|#
          “It is actually front-page news in Sweden.”

          And to dipshits like da troof, this MEANS something. Well, something…..

        3. the danville plan will close 2 minutes after unionizing, and of course all those former ikea workers will be better off unemployed

        4. No, it’s not. The only Swedish article that come up is from a local union paper. So that’s an complete lie. None of the big papers mention it, let alone have it on their front page. Dipshit.

    2. So what you’re saying is that Sweeden’s labor laws priced their own people out of the labor market, resulting in job creation here. Let’s summarize your argument:

      1. Policy differences between countries result in American job creation.
      2. ????
      3. Economic ruin for America!!!

      1. Why shouldn’t blue collar workers here be paid $19/hour minimum wage and five weeks paid vacation?

        1. The Truth|4.10.11 @ 9:45PM|#
          “Why shouldn’t blue collar workers here be paid $19/hour minimum wage and five weeks paid vacation?”

          Because YOU can be replaced at $10/hour, dipshit.

        2. Hell, why don’t we pay them $100 per hour with ten weeks of paid vacation?

          Because labor isn’t intrinsically valuable. Like all commodities, its value varies directly with scarcity. Most blue-collar factory jobs just aren’t that hard to learn, so a lot of people can do them. This depresses the price for those jobs.

          Paying people for five weeks of non-productivity also isn’t viable. The Swedes are simply the latest object lesson in that regard.

          1. Every other developed country in the world pays for “five weeks of non-productivity” as a right, in addition to healthcare.

            Using your logic, I guess you think we shouldn’t have a minimum wage at all? No limit on the amount of hours your employer can make you work? No laws against child labor? How about work safety standards?

            We must appease our Galtian Overlords!

            1. The Truth|4.10.11 @ 10:00PM|#
              “Every other developed country in the world pays for “five weeks of non-productivity” as a right, in addition to healthcare.”

              “Every other developed country”
              Cite, asshole?

            2. Using your logic, I guess you think we shouldn’t have a minimum wage at all? No limit on the amount of hours your employer can make you work? No laws against child labor? How about work safety standards?

              I think troofy is finally catching on.

            3. You’re right about the minimum wage – it’s an artificial price floor on labor, which drives down demand for it (i.e., lower employment).

              Since I work a job where there is no limit on the number of hours I work (on salary, too), I’m not particularly averse to the idea. If it becomes too much of a burden, I’ll quit for something else.

            4. The Truth|4.10.11 @ 10:00PM|#
              Using your logic, I guess you think we shouldn’t have a minimum wage at all?”
              Yes.

              “No limit on the amount of hours your employer can make you work?”
              Define “make” asshole.

              “No laws against child labor?”
              Yes.

              “How about work safety standards?”
              Are you dumb enough to work where it isn’t safe? Do you take your momma with you to make sure your momma says it’s safe?
              What a pathetic example of a supposed moral agent! How can you possibly make any decisions without a government worker leaning over your shoulder?

            5. You also still haven’t answered my question. Why stop at $19 per hour? When you figure out why $100 per hour for working in an IKEA plant is too much, you’ll realize why $19 might be as well.

              1. He won’t answer it because he knows that setting a price floor that high on labor would cause even more unemployment then what we have now. But hey, why not shoot for 17% unemployment like Sweden?

                1. The unemployment rate is 7.6% in Sweden. Google it.

                  Here, it is 8.8%.

                  1. Sweden fudges the numbers. When using the same metrics used to measure unemployment in the U.S., it comes out as 17%

            6. Every other developed country in the world pays for “five weeks of non-productivity” as a right, in addition to healthcare.

              The light will dawn on his marble head soon enough.

              1. “The unemployment rate is 7.6% in Sweden. Google it. Here, it is 8.8%.”

                Youth unemployment rate is 25,2%, vs 18,4 in the US. And that’s with a much better economy. Gee, wonder why?

    3. Yes, but how does this affect China?

    4. IKEA–isn’t that Swedish for “particle board”?

    5. In Sweden, Ikea workers make $19/hour minimum and have five weeks paid vacation.

      In Sweden, ABBA was considered rock’n’roll.

  13. As long as the Swedes impose tariffs to protect their overpriced furniture, they’ll be fine.

  14. No, Ikea should let them form a union instead of bringing in outside corporate thugs to union bust.

    Ikea should let them go work for somebody else. Like you.

  15. “And how will merely trimming government spending to Clinton levels create Clinton-era prosperity?”

    Nick Gillespie wasn’t saying that. Of course reducing welfare will hurt people on welfare in the short-run. But in the long run, eliminating a subsidy of unemployment will increase employment.

    “Might there be other factors at play, such as the state of the economy? (And what about Clinton-era tax rates?)”

    What about the state of the economy? Have you or anyone else proven a correlation between the Clinton tax rates and economic prosperity?

    “We’re supposed to accept Gillespie’s arbitrarily-chosen figures based on the premise that government debt is the cause of all our problems, and fixing it the solution.”

    Well, considering that by taking on debt we are a.) consuming capital now and b.) giving up further consumption in the future, I’d say that it’s a pretty big problem. But hey, in the long run we’re all dead, right? I sure hope I’m dead within four or five years when the shit really hits the fan.

    “But basic economics shows that lowering government spending will lower employment,”

    In the short run, sure. The resources freed up by reducing government spending will be reabsorbed into the private sector.

    “and that leads to decreased demand.”

    If you spend more than you save, you consume capital, leading to a fall in the standard of living. If Keynes knew anything about economics, he would’ve said that spending, not saving, is destruction.

    Every time you post I doubt more and more your claim that you’ve graduated from middle school, let alone the Ivy League.

  16. Have you or anyone else proven a correlation between the Clinton tax rates and economic prosperity?

    Are you crazy? The economy was booming during Eisenhower’s Presidency!

    QED.

  17. The UK went into austerity, and their economy is SHRINKING again.

    You guys are morons.

    1. The Truth|4.10.11 @ 9:09PM|#
      “The UK went into austerity, and their economy is SHRINKING again.”

      Socialism will do that.

      1. They also increased taxes.

        1. Free2Booze|4.10.11 @ 9:20PM|#
          “They also increased taxes”

          Socialism will do that, too. The question is whether those ‘increased taxes’ mean increased revenue.
          Capital is fugitive.

          1. “The question is whether those ‘increased taxes’ mean increased revenue.”

            Revenues may increase slightly, but at the expense of jobs.

            The VAT was increased from 17.5% to 20%, while household savings is 2%. Basically, consumers are going to spend the same amount of money, purchase fewer products, and see a larger portion of their spending go to government.

      2. Uh, they got a conservative government elected that drastically slashed government spending.

        Then, whaddyaknow, they have a double-dip recession. HOW COULD HAVE KNOWN??

        1. “Uh, they got a conservative government”

          The UK is governed by a coalition between the, at best, moderate David Cameron and the left-wing Liberal Democrats.

          There have been no massive cuts. There have been, however, tax and fee hikes.

        2. “Then, whaddyaknow, they have a double-dip recession”

          The Brown administration’s Keynesian stimulus spending caused malinvestment, trapping resources in unproductive ventures which there was no consumer demand for. There will be a readjustment period, known as a “recession”, where resources are realigned according to consumer demand and time preference. Moreover, double-dip implies that their economy was recovering, which it was not.

        3. The Truth|4.10.11 @ 9:20PM|#
          “Uh, they got a conservative government elected that drastically slashed government spending.”

          Uh, they got a ‘conservative’ government compared to the alternative, and they ‘propose’ to cut spending in the hopes they can recover from socialist policies.
          Lying asshole.

          1. It’s no use, Da Troof is immune to your puny facts.

    2. “The UK went into austerity,”

      As well they should. Massive malinvestment took place during the boom; it will take time for the economy to correct itself, and this process is further hobbled by regulation and taxation.

    3. The UK went into austerity, and their economy is SHRINKING again.

      That’s what happens when governments are forced to recognize reality instead of kicking the can further down the road. Reversion to the mean is always a painful process, but it’s necessary.

      The biggest lie that con artists like you peddle is that economic downturns can be engineered out of existence.

  18. Meanwhile, at the beginning of the recession China instituted the largest stimulus program as a percentage of GDP the world had ever seen, and the recession barely touched them.

    We need more stimulus, not less.

    1. Adorable.

  19. The Truth|4.10.11 @ 9:11PM|#
    “Meanwhile, at the beginning of the recession China instituted the largest stimulus program as a percentage of GDP the world had ever seen, and the recession barely touched them.”

    https://reason.com/blog/2011/04…..-australia

  20. “Meanwhile, at the beginning of the recession China instituted the largest stimulus program as a percentage of GDP the world had ever seen, and the recession barely touched them.”

    “CREDIT EXPANSION HAS NO NEGATIVE EFFECTS IN THE LONG RUN!!! LALALALALA!!!!”

    1. Yeah, you’d think someone named “The Truth” would figure out that you can’t have 2% inflation forever, but he and Tony have never shown an ability to do basic math. Score two for the public schools!!

  21. Gregory Ned Blevins (GregoryNedBlevins) wrote:
    Why you are talking to a Libertarian about this? They get more than enough air time elsewhere. Why are you not talking to someone like Senator Bernie Saunders or Representative Jan Schakowsky, people who recognize that the first step in fixing our budget problems is to ensure that those whose income exceeds one million dollars per year once again pay their fair share of taxes.

    Sigh.

  22. Also,

    boulder dude (BeeDeeFour) wrote:
    Nice to see the so called “liberal” NPR go to a Libertarian for a review of Ryan’s plan to gut the federal government.

    I am sure that NPR will have Krugman or Dean on any day now to do the same, you know, for balance.
    Sun Apr 10 2011 15:59:26 GMT-0400 (Eastern Daylight Time)

    Fucking right-wing NPR refuses to interview Krugman!

  23. Hey Jacket, have you ever come up with some sort of spending plan? Maybe based on how much revenue the government can expect to earn. That sounds like a good solution. You should write about that.

  24. In Summation:

    -TheTruth makes me question the value of human life when he says that we should institute a $19 per hour price floor on labor

    -Tony says with a straight face that booms and busts are inherent in capitalism, ignoring the fact that prior to central banks the world suffered under no such cycle

    1. Damn squirrel.

      -The world is all the dumber because of it

  25. Greetings retro-future people, after you dare to climb out of the coal mines of Old New Castle and once you wipe the soot off your faces bask in the glorious plan of retrofuture! A clock work society that will tend to your heartfelt desire for a collective good where a truly meaningful life can be lead. Cast off the dust of yesteryear and march into a bright shiny future. We’ll first buttress your bones with copper supports and replace your joints with springs; your brain cavities will be embedded with fastenings hoisting up the mainspring upon which the wheels of the most intricate gear trains will whirl!

    Match on forever forward Retrofuture Man!

    1. Newsletter?

  26. In the spirit of off topic crap, I submit unto you this: “Did you hear that the guy in Ivory Coast was captured by the cowardly French?”

    Seriously why does every thread on this site veer into a thousand different and irrelevant directions? Does the average libertardian suffer from severe ADD? That would explain the lack of success in the political sphere.

    1. Zoltar Comte sees all! Except maybe when he posted in the budget thread instead of the Liberaltarian rethread.

      But otherwise, fuck you Bob! What does a message board have to do with a party’s political success? One of which most commentators are not members? Nothing! What does political success have to do with real world success? Less than nothing! So a double butt pounding for you, Bob!

      Were you born stupid?

  27. I like the quip about the realistic expectations. The government is always so positive the market will provide excellent returns, even as it tries to tax businesses to death.

    http://www.intellectualtakeout…..ercent-gdp

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