Government Spending

U.S. Debt Now 100% Fun!

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Nobody's "Girlfriend," that's for sure

Don't you know the debt ratio's going up, up, up, up, UP!

US debt shot up $238 billion to reach 100 percent of gross domestic project after the government's debt ceiling was lifted, Treasury figures showed Wednesday. […]

The new borrowing took total public debt to $14.58 trillion, over end-2010 GDP of $14.53 trillion, and putting it in a league with highly indebted countries like Italy and Belgium. […]

The last time US debt topped the size of its annual economy was in 1947 just after World War II. […]

Moody's said Tuesday that the government needed to stabilize the ratio at 73 percent by 2015 "to ensure that the long-run fiscal trajectory remains compatible with a AAA rating."

Reminder: The commonly accepted threshold for converting debt-to-GDP ratios from tolerable to actively dangerous is 60 percent. Also: it's the "neo-Confederate" Tea Party "fanatics" who are threatening to "destroy America's credit rating unless the federal government agrees to enact Dixie's economic agenda."

Link via Instapundit. Reason on debt loads here.

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  1. “Moody’s said Tuesday that the government needed to stabilize the ratio at 73 percent by 2015”

    I’ll take the over.

    1. Can you even get a bet on the under?

      1. If the world ends in 2012, does that count as under?

        1. Nope, house wins in event of armageddon.

          1. The House Always Wins, Part II

            1. I’ll take India and the points.

        2. If the world ends I promise to pay you 100:1.

    2. Lets see…so we need 27% growth in 4 years?

      /didnt do the math, probably some wierd denominator stuff that makes it not quite that silly

      1. Okay, did the math. Need 8.19% annual growth in GDP, assuming debt doesnt grow any more.

        So, balanced budget plus 8% growth, no problem.

        1. or, couldn’t we just inflate the shit out of the currency (in a vacuum) to reach the same point?

          1. I like the cut of your jib.

            1. yeah, it only took germany a genocide and a few decades of our cash infusion to recover from when they did it. I call that success.

              1. Yeah but they didn’t do it right.

                See Krugman, Paul, Nobel Prize winner, Economist, Terrorist Spotter

  2. Nothing can harm America if we’ve declared it fashionable. And, right now, spending is in!.

  3. To live in this town, you must be…

    1. A Rolling Stones ref and a Michael Sweet ref in the same thread? Isn’t that like crossing the streams?

  4. At least cotton is a commodity. We have nothing backing our fiat currency.

    1. I think their is actually some cotten thread in our paper money. Does that count?

      1. LOL. Not quite. The CSA had raw cotton to back their currency. It was terrible and did not hold up the value of their currency well – but it was better than what we have now – which is nothing.

        1. That’s not true.

          We have the good faith and credit of the Federal Reserve.

          What could possibly go wrong?

        2. I was tought they had slave blood to back up their currency.

          1. Yes, that’s why Lincoln established the first Federal Bureau of Vampire Slaying to neutralize that advantage. IIRC, the Pinkertons started off as a front for the slayers.

            1. They’re making a movie out of that.

              1. Good point, I wasn’t even thinking about that. If Spencer was referring to that, I guess that was a snark fail on my part.

  5. The last time US debt topped the size of its annual economy was in 1947 just after World War II.

    But don’t you peasants dare start a fucking victory garden. Or Else.

    1. Buying war bonds is OK though. Please, please, please buy our war bonds!

      1. Will do, boss!

        1. No, no — The Ben Bernank buys the Treasury Bonds from the Goldman Sachs, not from the Treasury.

          1. Yes, and then the Goldman Sachs feeds the beast back with the campaign contributions. Convenient, eh?

      2. War Bonds make a great soil amendment.

        1. We will always be at war with North America.

  6. Moody’s said Tuesday that the government needed to stabilize the ratio at 73 percent by 2015 “to ensure that the long-run fiscal trajectory remains compatible with a AAA rating.”

    Let’s be mildly optimistic and say the economy grows by 2.5% a year for the next four years. Call it an 10% increase in GDP from organic growth.

    That means our debt (note, not our deficit) would need to be reduced by 17% in the next four years. This would work out to running a 4% surplus for each of the next four years.

    So, we just need to reduce government spending by around 44% (current deficit of 40% plus 4%) to meet this goal.

    Am I missing something here?

    1. 2.5% for the next 4 years is wild-eyed optimistic, I am sad to say. We’re screwed.

    2. Of course, I just realized what I’m missing. Reducing government spending also reduces the GDP.

      What’s our current GDP? Around $16TT? That would mean that the deficit spending (say, $1.4TT this year) accounts for around 8.5% of our GDP, yes?

      So we need actual organic growth in the economy of around 11% per year. For four years in a row.

      1. Reducing government spending also reduces the GDP.

        Oh crap, that screws up my math above.

        So, yeah, something like 11% instead of the 8% I calculated.

          1. So, 10.6% if we balance the budget via spending cuts, 8.2% if we balance it via tax increases. Somewhere in between with a mixed plan.

            Nothing will cause 8% growth quite like a tax increase.

            1. Worked for Herbert Hoover.

            2. Speaking of economic growth, do you have a website or twitter account up yet for the brewery?

              1. Brewery? What brewery are you speaking of?

                1. A new beer to try? I’m in.

              2. sort of, re: website, but its just a logo right now. BlissAveBrews.com for anyone who wants to see the logo.

                Twitter not set up yet. Might need to do that before next week.

                You going to Great Taste this year?

                1. Things are happening slow, going to kick marketing into gear before fall gets here, but probably wont be any beer until late winter/early spring.

                  1. I have a dream of my own brewery some day. Any pointers? Should I quit my bullshit day job workin’ for the man and get a job at a local microbrewery?

                    1. Do you have easy access to $400k? That helps.

                    2. Unfortunately not…

                    3. “access to” is different from “in pocket”. It turns out to be not necessarily that difficult to raise that much (not that I have yet). People want to own a small chunk of a brewery.

                    4. Some friends-of-a-friend keep talking about doing a microbrewery but they can’t agree on whether they attach it to a restaurant or just do a craft brewery standalone. I’ve offered to do the process design engineering work and equipment selection in exchange for an equity stake, but I don’t think they’ll ever come to an agreement over their differences. They don’t want to pay someone to engineer a system, but if they try to farmer-rig their own brewery like it’s a homebrew system, they’ll run out of working capital just working the bugs out before beer #1 is in the bottle.

                    5. Do you have easy access to $400k? That helps.

                      I know a good way to become a millionaire.

                      Start with 2 million dollars, open a brewery. In less then a year you will be worth 1 million dollars.

                      (note the original joke is for a restaurant not a brewery.)

                    6. That joke is very common in the brewing community.

                      More in this form: How do you become a millionaire brewer? Start as a multimillionaire brewer.

                    7. Definitely holds true for vineyards.

    3. You have to be, because if we even came close to balancing the budget, the credit agencies would relax. I can’t imagine that they would have let us hold on to our AAA rating for so long if it’s going to take actual debt reduction to keep it. Something’s off here.

    4. You are missing the part where we magically transition to a post-scarcity economy. I think that’s a crucial component of the Fed’s plan at this point.

    5. Does anyone seriously believe that the ratings agencies will ever grow balls big enough to drop our rating?

      The federal government has no shortage of arm twisting methods, and means of extortion, to make life a living hell for anyone who would rate America’s credit worthiness accurately.

      1. I’m beginning to seriously doubt it. I was hopeful a while back when they started making noises about it, but if if they think anyone in Washington is serious about fiscal responsibility after the circus we just went through with the debt ceiling debate, they need to put down the crack pipe.

      2. It’s going to be hilarious when none of the big names in bond trading are willing to buy U.S. debt, but we still have a AAA rating.

        1. They owe us one for the housing debacle. The President is collecting on your behalf. Ingrate.

  7. Let’s assume that we have a balanced budget the next four years (yeah, I know) and the debt stays at $14.58 trillion, to get the debt down to 73% of GDP by 2015 would mean that GDP increased by 37% from 2010. Now I’m not Noble Prize winning economist, but this strikes me as highly unlikely.

  8. We’ll get the debt ratio down. We’ll do it by inflating our way out of debt.

    The astonishing thing about the $1 Trillion “Magic Coin” solution is not that it was proposed, but that many on the left, including a segment of the professional pundit class, took it seriously. It’s only a matter of time before teh Krugtard starts suggesting printing money as a serious solution.

    And of course it fits with the left’s policy goals. Want to make oil imports more expensive? Pummel the dollar. Want to get at the accumulated savings of those billionaire corporate jet owners (i.e., families making $250,001)? Inflate the dollar until their savings can’t buy a Big Mac.

    1. We’ll get the debt ratio down. We’ll do it by inflating our way out of debt.

      I’m not even sure this is possible. Inflation drives up interest rates, which drives up debt service costs on your short-term debt when it rolls over. And we’ve been shortening our debt for some time now.

      1. Doesn’t the Fed determine interest rates? I thought that increasing interest rates was only a tool to combat inflation, not a direct effect of inflation.

        1. The Fed can’t control interest rates. It is not God. The only interest rate the Feds can control is what it charges member banks to borrow money from it.

          If you loan money to someone and charge less than the rate of inflation, you are losing money on the loan. Over any appreciable time span, interest rates will exceed inflation.

    2. Actually, this SHOULDN’T fit the Left’s ideas at all. I am a libertarian, but consider myself on the “Left” because most things the government does disproportionately hurts low income people and small businesses. Printing money is a heavy tax on the poor, because their wages will not match the price inflation, resulting in further inability to provide for their family’s needs. As a percentage of an individual’s budget, government inflation is as regressive of a tax as you can possibly have – it’s like a sales tax on everything.

      1. You think the “Left” actually wants to help poor people?
        Ah. Here’s your problem.

      2. Two things about this:

        First, the left does not really care if the poor get hurt as a matter of economic reality. What they care about is assuaging their own guilt, and perserving their self-granted moral superiority, by mailing checks to people. Whether the checks accomplish anything (which they haven’t) is entirely beside the point. Hence, any policy move that permits the check printing presses to keep running, including inflation that makes the checks worthless, is what the left will want. Anything else will not make them feel good about themselves.

        Second, the entire situation is now too far gone for the left to act sensibly. It’s like they are 50 moves into a chess match, and they’re now only beginning to realize that they don’t really understand the game at all. And so we have game pieces being moved all over the place for no rhyme or reason and with no results. Panic will cause (and is causing) moves that are not just stupid but completely self-destructive. As we speak, we are essentially moving our king into the checkmate zone, but don’t realize it, and probably could not manage to do anything else even if we did realize it. And by “we” I mean the political class, especially the left.

        1. Hmmm….looks like some whacked the Ben Benank in the head with a 2×4 this morning.

      3. I am a libertarian, but consider myself on the “Left” because most things the government does disproportionately hurts low income people and small businesses.

        The fuck…?

        1. I actually find this refreshing.

          1. Yeah. It threw me for a loop at first, but I guess I do, too.

      4. “Printing money is a heavy tax on the poor, because their wages will not match the price inflation, resulting in further inability to provide for their family’s needs.”

        More poor people, means more people who will vote in favor to create new programs for wealth re-distribution. Promoting class warfare fits perfectly into the Lefts vision for America.

        1. Diabolically ingenius but I’m not actually sure the left is that smart.

          1. Au contraire: that’s what the Cloward and Piven strategy is all about.

            1. Au contraire: that’s what the Cloward and Piven strategy is all about.
              reply to this

              How’s that going to work when most of the middle class looks around and decides it’s time to punt? You can yoke “The Rich” for about 6 months before you’re forced to check the sofa cushions for spare change.

              1. Not their goal. They WANT to break the system. Once you get enough people to believe that we’re a democracy rather than a republic, and start acting accordingly, it’s a short trip to a benevolent dictatorship.

        2. The self-appointed duties of a Progressive are to make sure more and more people are utterly helpless; that their own hands almost become vestigial organs. Progressives dream of a society that’s dependent upon the government for everything. Liberal politicians know that “job security” and “meal ticket punched into perpetuity” equals an infantilized constituency that can tolerate no risk, and that welcomes the most intrusive of nannies.

          1. Yup. I don’t even think progressives pretend about this anymore. They know exactly what they’re doing. Keep most of the people down, use your power to promote a select group bureaucrats to positions with special privileges, and have a tiny group of elites who keep the whole show going. It’s as if when they studied ‘1984’ they failed to recognize that it was a dystopian novel and instead thought that is was a civics textbook.

      5. There is no such thing as a “left” or “right” wing libertarian.

        Either you want the government to stop interfering in people’s voluntary interactions and choices, or you don’t.

        It doesn’t matter if the victim of coercion is rich or poor.

        1. I’m no anarchist, so assuming the (minimal) government needs funding, taxation would be a point of difference amongst miniarchists. I support a land value tax which is naturally progressive, has no deadweight loss, and is logical from the standpoint that jurisdiction over a land area is what defines a government and land is more or less a zero-sum game. Also, see below re: corporations.

      6. “…because most things the government does disproportionately hurts low income people and small businesses.”

        P.S. What does this mean?
        Would you have less of a problem with government if what it does ‘proportionally’ hurts low income people and small businesses?

        1. No, didn’t say that or imply that at all. When I first got into politics, I was a Naderite Green. Then I learned economics enough to realize, to my horror, that everything the Left does makes life for small businesses and the poor worse (either directly harmful regulations and restrictions, or creating dependency), while most naively believe it is improving it. While I agree the intentions of the highly educated “intellectual” Left and the politicians in power are truly all about control and manipulation, I think your average Leftist really thinks their policies are doing good for the poor, limiting corporate abuses, etc.

          Even after I came to libertarianism, I still to this day hold many of the same values I held as a Leftist – increasing economic and social equality and mobility, protecting the environment, gay rights, progressive tax rates (a single land value tax, a naturally progressive tax with no deadweight loss), etc. I just argue that government should always the last resort instead of the first, because almost every Leftist policy worsens conditions for the people they are claiming to help. The government is the worst polluter of all, doesn’t care about the property rights of the poor and hinders their economic mobility, gets in bed with the corporations when it claims to “regulate” them (and makes them more powerful by limiting competition), etc.

          I don’t even think government should be in the business of protecting corporate owners from liability for their actions, which I would argue is a big distinction between Left and Right libertarianism. Libertarians understand that government shouldn’t interfere with marriage contracts or provide any special statuses for gays or straights, yet they fail to see the same problem in gov’t incorporation, which I’d argue is maybe the biggest market distortion of all. All businesses should be proprietorships or partnerships and assign their own liability internally or purchase liability insurance. That would be a true free market.

          So I don’t think there’s any conflict calling myself a left-libertarian.

      7. I believe in context that meant the progressive establishment.

    3. Yeah, if the solution to the problem was as simple as Geithner minting a few trillion-dollar platinum coins, then why wouldn’t we just use those to pay off all our external debt? It wouldn’t even make sense to borrow any money.

      The rather obvious answer is that the Chinese would laugh in our face and never accept the “Geithner” as a form of repayment. If you’re going to inflate, you have to at least do it slowly. The Chinese and the Russians are already getting pissed at the rate we’re doing it now.

      1. They would have little recourse. They hold US debt that obligates us to pay them “dollars”. If we print more of these “dollars” and give them to the Chinese we’ve fulfilled our end of the obligation.

        1. I think we offer the Chinese a deal: we’ll pay you back or you can have what’s behind the curtain that Carol Marol is standing by.

          Everybody picks the curtain! You’d think they’d know it’s never a car, and almost always a cow attached to a wooden trailer (how do you feed a billion people from a single cow?).

    4. I suppose it’s obvious to most folks at Reason, but I’ll say it anyway: inflating won’t work. Federal entitlements, pensions, and salaries are generally inflation-indexed. Debt markets are bound to drive up interest rates. Inflate and the deficit automatically increases. Eventually the house of cards will collapse. Keynes is dead and the long run has arrived.

      1. You have to do it quickly. Pump out a bunch of money and spend it before the annual COLA takes place. Also before us proles can get our hands on the money and spend it.

    5. except for the part where those billionaire corporate jet owners can afford to protect their money from inflation by simply changing where they invest it. I.e. in some other country. Perhaps they will completely leave for that other country if it gets bad enough. They can of course afford to at any time.

      just another failed attempt to get at the rich that lands squarely on the middle class.

  9. Cognative dissonance at work:

    “Now, they’ve been around for a while, but they are spreading far and wide and more people are getting involved. We need to have an American spring, you know, the Arab spring. The non-violent part of it isn’t finished yet, but we need to have an American spring. A kind of an American Tahrir Square. Non-violent change where people from the grassroots get involved again. Not the, you know, not in the Tea Party style,'” Al Gore said on Current TV’s “Countdown with Keith Olbermann.”

    “There are people who are genuinely upset in the Tea Party. I understand that. But that movement was funded with seed money from right-wing billionaires, the Koch Brothers, and promoted on Fox News,” Gore said.

    Al Gore is the founder and chairman of Current TV.

    Topics for discussion:

    * Who is the current president of the United States against which such a revolution would be mounted?

    * Who provides the seed money for Gore and Olberman’s favorite causes?

    * Who provides the seed money for Current TV?

    * Where will their revolution be televised?

    1. Non-violent change where people from the grassroots get involved again. Not the, you know, not in the Tea Party style,

      Non-violent grassroots change strikes me as an excellent description of the Tea Party style.

      1. Well, except for the change.

      2. Well, there were a few people exercising their right to carry at Tea Party events. Which I guess proves the Tea Partiers are violent people.

        1. also they are disproportionately white southerners as we learned in another story today. which means they are RACISTS who want to secede and bring back slavery.

    2. * Where will their revolution be televised?

      On a channel that not one in ten Directv customers could locate on the program guide.

      1. That’s because DirecTV is a Newscorp propoganda tool. Murdoch makes sure to bury CurrenTV, eventhough he’s like the only damn person who carries it.

    3. Spooky Dude?

    4. Well, he hit all the BOOGEYMAN! talking points.

    5. “There are people who are genuinely upset in the Left Movement. I understand that. But that movement was funded with seed money from left-wing billionaires, George Soros, and promoted on MSNBC News.”

      Fixed.

    6. Shorter Gore: We want our own tea party! It’s not fair! Waaahhh!

      1. We want our own tea party!

        What the fuck do you think the SEIU is?

  10. What happened to all that civility talk from the left (who were pretending to be centrist)? Seems like as soon as they started calling for it, they started labeling their opponents as “terrorists”, and their Team Blue fans are parroting it all over the place.

    1. It’s not violent and threatening when their tribe does it.

    2. It went down the same hole as the anti-war movement.

  11. I think maybe that kid is taking the whole cell phone/brain cancer thing just a little too seriously.

  12. The Salon comments…holy shit.

    It seems that the South has pulled off an incredible trick of being stupid, racist, inbred welfare cases AND AT THE SAME TIME a conspiratorial, diabolical, evil genius monolith that is sure to bring down the Republic from the inside and bring us back to the days of Antebellum planations. Very impressive!

    1. Bush did that, too. Despite being Chimpy McFlightSuit, the world’s dumbest fascist, he managed to lie us into war and outmaneuver the Democrats at every turn. Meanwhile, the smartest president ever – who surely must be playing four-dimensional chess, because there’s no way someone that goshdarned smart could be making so many mistakes – keeps losing to the Jesusland retards.

      1. ….he managed to lie us into war and outmaneuver the Democrats at every turn.

        Political drunken boxing.

    2. The lefties do a lot of misunderestimating of our strategery.

    3. I didn’t even make it to the comments, the article itself is so laughably execrable. I knew Salon was pretty out there, but totally off the deep end?

  13. 1. Increasing taxes =/= increasing revenue.

    2. Income =/= wealth.

    3. Libertarians =/= Republicans.

    4. Two wrongs =/= one right.

    1. No. Today is No Tony Day.

      1. It’s Christmas?

        1. That would be heaven. And it’s Christmas every day in heaven.

        2. No, he’s getting those itchy crotch bumps checked out.

      2. I saw a documentary about that once. Day without a Tony, I think it was called.

    2. You’re making things way too complex for Tony.

      He must think libertarians = Republicans, otherwise he’d have to get indoctrinated all over again, just to switch to a whole different set of fallacious arguments.

    3. The income/weath distinction is lost on about 98% of Americans these days, and it is a sad comment on our collective loss of financial literacy and common sense.

      1. Because too many Americans don’t have “wealth”. They just spend whatever they take in so that they can drive cars that cost 75% of their annual income and live in houses that have two rooms for every person. If the middle classes would increase their savings rates then we could drive economic growth by cutting their taxes. Instead, the only savers are high-income/high-wealth, so their taxes have to be cut to grow the economy.

        1. I agree that’s what people do, but not having wealth does not seem to be a good explanation for the failure to even understand what weaklth is. It’s like the masses have gone insance and can conceive of wealth only in terms of consumption. Now of course, government has played a massive role in that. Why save for retirement when generations have been told to expect unrestricted access to government pensions and that the “rich” will pay for it? And now we have the Fed positively punishing people who dare to save.

  14. “Reminder: The commonly accepted threshold for converting debt-to-GDP ratios from tolerable to actively dangerous is 60 percent.”

    You don’t prove a point by linking to Google, Matt. If we’re in the danger zone, why is the yield on Treasuries so low, and why is the stock market so high? I guess this means that markets are, you know, inefficient.

    Oh, and good news for Obama: Harry S was elected in 1948. I guess when the debt gets high, the Democrats get lucky. Mitt Romney is looking more and more like Tom Dewey every day.

    1. “why is the stock market so high”

      Where have you been for the past week?

      PS – The answer is: Globalization

    2. If we’re in the danger zone, why is the yield on Treasuries so low,

      I suspect a combination of

      (1) Treasuries being the least bad sovereign debt risk, for now, thus making them (relatively) the “safe haven”.

      (2) Bond market manipulation by Treasury and the Fed. QE2 was outright manipulation of the bond market (massive purchases by the Fed to keep rates down). I have no reason to believe it has stopped, just because they said it did.

      1. (1) Treasuries being the least bad sovereign debt risk, for now, thus making them (relatively) the “safe haven”.

        ______________________

        Bingo. The entire Eurozone is a basket case at this point, and Japan is in worse shape than we are. The really stable countries aren’t that large and don’t issue enough bonds to soak up the demand for government paper. We benefit from that. For now, but not much longer.

        1. Given the run in gold and silver, I’d have to say we are much closer to no longer than not much longer.

    3. why is the stock market so high

      Massive liquidity injections by the Fed have to go somewhere. Bond rates are stupid low, so that money will go to equities.

      I guess this means that markets are, you know, inefficient

      In the short run, markets aren’t perfectly efficient and subject to manipulation and bubbles. In the long run, nothing is proven to be better than markets.

      1. So what do I do to protect my vast libertarian wealth?
        I tried to extend my empire to the east at a land auction last night. Alas, I was outbid, beaten like a ten-year-old layabout in a Koch Brothers monocle factory. But the going price for the 40-acre lot/farm field was about 35 percent less than it sold for 10 years ago.

        1. So what do I do to protect my vast libertarian wealth?

          I tend to think that the game these days isn’t so much asset accumulation as asset protection, so I think you’re halfway there.

          I’m honestly baffled. I’ve got as much in precious metals and mining stocks as I can stand (and the stocks have not done particularly well). I’ve hedged some of my cash against swiss francs and canadian dollars.

          I’m almost entirely out of the stock market, and I believe you would have to be borderline retarded to buy bonds. Commodites are a puzzle – they are usually driven by global economic demand, which seems to be softening, a lot, but they are also a hedge against monetary inflation, which seems to be coming.

          So, I just don’t know.

          1. My old man, who has been trading stocks for 30+ years, just doesn’t know what to invest in either. He’s also pulling out of the market – though he’s lucky enough to be at the age where he doesn’t care too much about profit – just $$$ protection.

          2. Commodities may be softening for the short term, but the long term trends, as you pointed out, point to continued apppreciation. I mean, the bank of Korea has bought gold for the first time in a decade, not exactly a vote of confidence in fiat currencies given that all the developed economies and the developing economies are trying to depreciate the value of their currency.

            1. Agree on commodities, especially oil. It is hard to see the price dropping appreciably anytime soon, and the potential for appreciation is very good. Of course, technology is the risk. It can open access to massive supply, a la nat gas and possibly rare earth minerals on the sea floor. But if I am going to lose on any investment, I’d like it to be the result of tremendous human progress like being able to collect minerals at 20,000 feet below the Pacific.

          3. You mentioned Swiss francs on an earlier thread, and I thought Swiss stocks might be a way to invest in them without the transaction costs associated with currency futures or options.

            I’d say Nestle looks good. People will need their chocolate even in a depression.

            1. They will need their chocolate especially in a depression.

        2. Alas, I was outbid, beaten like a ten-year-old layabout in a Koch Brothers monocle factory.

          You, sir, win the interwebz today.

        3. “So what do I do to protect my vast libertarian wealth?”

          Gold!

          It’s never been worth zero.

        4. Spend money to build a network of friendships with people who will be valuable in post apocalyptic society. Doctors, farmers, gunslingers, that sort of thing.

          1. Guess I’d better stop hangin’ out here, then.

        5. FWIW, my wife wants to start a small farm in the Plain City area. Not that we can afford it.

          1. You folks weren’t at that auction, were you?

            1. We should start the Free County Project.

            2. No, but reading this thread makes me think I should get serious about making her dream a reality.

    4. If we’re in the danger zone, why is the yield on Treasuries so low

      Because the Fed has been purchasing 70% of recent treasury auctions, perhaps?

      http://www.galtstock.com/PIMCO-Out-of-Bonds.html

      I’m going to venture a guess that the market by itself could not support interest rates this low.

    5. why is the stock market so high?

      __________

      Dow down another 2% and S&P down another 2.25% as I write this. Care to revise and expend your remarks?

      1. Make that 4%.

    6. Seriously dude, you ought to actually pay attention to the news once in a while so you don’t make a fool of yourself.

    7. That’s a lot of stupid in one comment.

      1) Google link provides much evidence for the assertion that — just as I said! — 60% is the “commonly accepted threshold” for debt-GDP ratios to set off warning signs among economists. Whether that means we’re *in* a danger zone is a separate point.

      2) Fundamentals can be terrible even when not reflected in current market prices. See, for example, the housing market in 2006, or the dot-com tech sector in March 2000. You will find a lot of commentary from the last moments of just about every bubble along the lines of “what problem?” The argument has always struck me as dumb, even when the risk was not to an entire economy.

      3) Why on earth would you believe I subscribe to the Efficient Market Hypothesis?

      As for Mitt Romney analogies, my money’s on him being the Republican John Kerry.

      1. What will be Romney’s “Vietnam,” (i.e., the thing that he won’t STFU about, ever?_

        1. Business experience.

          1. Hair products, would be my bet.

        2. Indians are red because they pissed off god.

          1. and magic underwear…

      2. As for Mitt Romney analogies, my money’s on him being the Republican John Kerry.

        If John Kerry switched parties even he would beat Obama in 2012.

    8. If we’re in the danger zone, why is the yield on Treasuries so low, and why is the stock market so high? I guess this means that markets are, you know, inefficient.

      Markets tend to get distorted when they’re gamed. Considering that treasuries are being purchased largely by banks with money given to them interest free from the Federal Reserve, under the unwritten agreement that “I’ll give you free money if you promise to buy this thing off my buddy,” it’s not really a surprise that the guy getting all the free swag ain’t bitching about the interest rate he receives.

    9. If we’re in the danger zone, why is the yield on Treasuries so low, and why is the stock market so high?

      I’m the new black!

    10. “and why is the stock market so high?”

      Talk about terrible timing.

  15. Coming soon! Sherlock Holmes and the Trillion Dollar Bank Note

    1. Double-feature with Indiana Jones and the Trillion Dollar Kenyan Doubloon

      1. Capcom is working on Professor Layton and the Curious Case of Economic Collapse

    2. Actually, they were thinking of making it a platinum coin, not a note. Coins are cooler because they’re heavy and stuff.

      1. is that why platinum is down almost $50this morning?

  16. I like that CD. Does this prove that at least one other person knows it exists?

    1. I know it too, though if I were to pick a Matthew Sweet album that adequately describes the current state of our economy, I would have gone with Altered Beast.

    2. “I’m sick of myself when I look at you…” (bitchin’ Richard Lloyd solo)

  17. Meanwhile (I don’t even remember where I read it- NYT blog, possibly), Laura Tyson says we NEEDZ MOAR STIMULUSES.

    We’re DOOOOOOOOOOOOOOOOOOOOOOOOOOOOMED.

    1. It is truly astonishing how clueless and inept our ruling class is.

      1. Cargo cult economics informs the policy prescriptions of our ruling class.

  18. You people do not understand macroeconomics, the higher the debt the more the economy can grow, Paul Krugman and Brad De Long say so, they are much smarter than you !

    1. Go work on your Faux Tony……..NEXT!

  19. Does Troll-free Thursday include fake trolls?

    1. That’s a dangerous game you wish to play…

    2. What does fake and real even even in the context of trolldom?

      Did I just, like, blow your mind, man?

      1. Don’t feed it.
        Wait. what?

  20. INSERT COIN AND MAKE SELECTION. THIS MACHINE ACCEPTS ONE THOUSAND AND FIVE THOUSAND DOLLAR BILLS.

  21. The Al Gore call for a Mideast spring is amazing. Just who are these protestors going to revolt against? The 87 tea party reps? What would they do? Go around and terrorize enemies of the people? Cultural revolution maybe?

    1. If/when a Republican takes the White House in 2012 I get the feeling that the Left is going to go full retard. Should be entertaining.

      1. Yeah. By any objective measure the debt deal is a feeble attempt to reduce government. And they have gone insane over that. What will they do when the reckoning actually comes?

        1. Wisconsin pretty much set the tone. Even means testing Social Security would be met with massive resistance.

          I really don’t see any meaningful entitlement reform happening without being preceded by an actual full-on fiscal crisis. The public just won’t accept it at this point.

          1. The conversation needs to be changed. Right now, “cuts” mean reductions in the growth of future spending ( I won’t go into all the other examples). A reality-based political vocabulary is necessary before the public at large wises up.

          2. I think you are dead on with your assessment.

          3. You’ll have to take my Social Security check out of my cold, dead hands, punk. I paid into that system for my entire working life, and now it’s your turn.

            As for Medicare, well, I can’t afford medical insurance at my age, so I need the government to pay for it.

            And God bless our troops with ever higher military spending. But, by all means, cut out all of that foreign aid and welfare.

            1. Ah, re-enactment of certain clockwork orange scenes is going to be fun.

            2. “You’ll have to take my Social Security check out of my cold, dead hands, punk.”

              That’s what the death panels are for, gramps.

        2. I’d expect the French Revolution without the adminstrative competency–most Gen-Xers and Millenials can barely function without someone tying their shoes for them, and the Baby Boomers don’t have the collective energy anymore to hold things together. I can’t imagine how badly they’d react if the spigot suddenly turned off.

          1. most Gen-Xers and Millenials can barely function without someone tying their shoes for them

            Ahem. Way to tar with a braod brush. The boomers have done such a fucking bang up job, haven’t they?

            Remember, Sturgeon’s Law applies to everything.

            1. Ahem. Way to tar with a braod brush. The boomers have done such a fucking bang up job, haven’t they?

              Did I say they had? They’ve overseen most of this decline, correct?

              And I’ll talk shit about Gen-X and the Millenials all I wish, thank you very much. Considering this site has devoted attention to the government’s role in the decline of American education, it’s not too out of bounds to say that the US is wallowing in several generations of collective mediocrity.

              1. Yeah, sadly, most of my generation voted for Obama, so I can’t think they’re very intelligent.

                I also voted for Obama, but I also voted for a Republican for Senate. I was hoping for a divided government. And yeah, that’s probably the last time I vote TEAM RED or TEAM BLUE for Pres. ever.

                Then again, the worst part of it was I was at college when Obama got elected. UGH. There was an all night party in the place where the school held a viewing. I may have voted for the fucker, but I wasn’t dumb enough to believe the fucker.

                And yes, I will be living down voting for Obama my whole damn life.

                1. A self-congratulation fest, no doubt. We voted for a black dude, we are so tolerant and enlightened!!!

                  1. A self-congratulation fest, no doubt. We voted for a black dude, we are so tolerant and enlightened!!!

                    If greatness was measured in terms of navel-gazing and fart-sniffing, today’s college students would be Antonine Rome and the Mongol Empire rolled into one.

                    1. Damn sock.

                2. Don’t worry. I have friends who are still living down Carter.

                3. I could have used an IV drip of nausea medicine during the week after Obama’s victory.

      2. If/when a Republican takes the White House in 2012 I get the feeling that the Left is going to go full retard.

        You’re off by at least a year. They may be hitting full retard now. Certainly, by no later than half-way through the Presidential primaries.

        1. They’re setting the battleground for their 2012 narrative, but if a Team Red person wins the election, I predict a full-on psychotic break.

          I had an interesting “conversation” with a left-wing Milennial on Facebook recently, and if she’s representative of the rest of her fellow travelers, it won’t take much to push them over the precipice. When you’re openly advocating that the Bachmanns should “be afraid for their lives” wherever they go, as this girl was, then it’s pretty clear you’re already beyond any point where rational discourse is going to have an effect on you. A full generation of left-wingers who’ve been taught to emote about every single fucking thing is not a good long-term recipe for a stable society.

          1. Agreed, particularly on your comparison to the French Revolution above.

            The capacity for violence is there, the rhetoric is becoming increasingly heated, and the line in the sand is slowly being drawn. Wisconsin is the model, any threat to entitlements will be met with massive protests, this time across the nation. Unlike the anti-war movement, peace won’t be the central theme, and I would not be surprised if some of them escalated into riots.

            1. We’re probably 5 years off of full on civil unrest. The shitstorm should be entertaining.

              1. I add to my emergency food supply about once a month.

                1. I add to my emergency food supply about once a month.

                  That’s great if you’re living in a relatively isolated area–it won’t do you a lot of good if the urban hordes start the looting spree, even if you’re stocked up on lead and lead delivery devices.

                  Personally, I’d rather grab my bug-out bag and my shotgun, and take my chances with the black bears and mountain lions if such a scenario does indeed take place.

                  A French Revolution-type event here would likely get REALLY ugly, since it’s not necessarily class warfare at stake, where the “hated” are easily identifiable. It’s ideological, and “who you voted for” would probably be the difference between life and death.

                  Even though no one wants to admit it, the country is due for a massive structural de-scaling, and the real question is how dramatic it becomes on a social level.

            2. That is what ann coulter says in her new book. The left has become a mob similar to the one in the French revolution . I don’t think she is too far off. Worse, they are in total denial about how out of control they are.

              1. Well, luckily, I’ve already been preparing for a zombie apocalypse, so a French Revolution will be nothing.

                Seriously, the plan is easy guys: There will be rioting, so there will also be looting. Go to your nearest gun store, and loot the shit out of it.

                1. Go to your nearest gun store, and loot the shit out of it.

                  Have at it. I’m hitting the pharmacy.

    2. Does this poll well? Calling tea pirates terrorists?

      I can’t imagine that it does.

      Perhaps what we are seeing is what happens when the left stop looking at the polls and start playing from the hip.

      1. MASTER’S DEGREES!

        1. Why do I keep getting the masters degree trolling?

          Did someone spoof me on that Matt Damon post?

          Look for what it is worth I do not think Nick was wrong by comparing bachelor degree salaries with teacher salaries.

          So quit trolling me!!

          You got the wrong guy!!!

          1. Speaking of which amount, without taking in effect kind, of education is terrible tracker for income. Nick for example has a Phd.

            And he is so poor he has to go door to door to sell optimistic librealtarian books and date a Fench economists to get by.

          2. What? I was just giving you an example of the left playing from the hip. The result is fail. Although that’s usually what you get when they read polls too.

    3. I asked my liberal Democrat wargaming friends (go figure) about the whole “Tea Party extremists caused the debt ceiling problem” meme last night.

      Me: did they vote for the bill?

      LDWF: no.

      Me: then why does anyone care what a few dozen yoyos who lost a showdown in Congress think?

      LDWF: . . .

      1. Tony answered this very question by saying that if it were not for the Tea Party we would never have had a show down…..

        So I guess the whole complaint is that the tea party “made” the Democrats debate the issue before they won the issue.

  22. the going price for the 40-acre lot/farm field was about 35 percent less than it sold for 10 years ago.

    This surprises me, as I have lately been hearing about the reflation of the farmland bubble. However, that (2001) price may have been based on the expectation of the land’s subdivided value in the Columbus expansion boom.

  23. Hey, I wonder if we could pay off our national debt with this?

    1. I got one ‘o those on display at my desk.
      It’s quite purdy.
      True story.

      1. I’m bidding for it.

        1. Don’t pay more than 99.99 trillion!

  24. It still went for twice (per acre) what I paid for my 20 acres 20 years ago.
    I was fully willing to pony up the 1991 price per acre.

    1. Adjusted for inflation, I wonder if it was any more expensive than what you paid 20 years ago.

      1. Yeah – If it had been actually adjoining my property instead of a mile drive (or a 1,500-foot kayak trip — downstream!) away, I might have been willing to extend a bit more.

  25. Okay, I’m really started to get worried.

    At this rate, I’ll soon be stuck up north chopping wood to barter with the local farmers.

    1. I’m looking for laborers willing to work in the compound for firewood, LH.
      Win – win.

      1. I still got the hustle!

      2. I’ve had a number of people (mostly liberal co-workers of mine or my GF’s) say that when the SHTF, they want to be at our place (plenty of acreage, firewood, water etc.). I ask them what value or labor they are willing to exchange for a share in the benefit of our foresight? I usually get blank looks back, like they can’t understand why we wouldn’t be glad to invite them over like another dinner party.

        1. Obviously db, their value is in their potential to feed you once they have worn out their welcome (about 5 minutes after the SHTF).

        2. Always nice to have a few extra guests drop by. Just sayin…….

    2. Just don’t start a dairy farm with the intention of selling raw milk or raw milk cheese.

    3. I don’t mind chopping wood. And I don’t care if my moneys no good

      1. If that’s not a song lyric, it should be.

        1. Na na na na na, na na na na.
          Whew. That’s a lotta na.

          1. But still not quite enough for 2005. Na Na Na Na Naa

          2. Can we get in on this?

            Mmm mmm mmm mmm…

      2. John, do you write country/folk for a living?

        1. No. I just listen to it. It is from The Night They Drove Old Dixie down

      3. Sounds familiar. I can hear Levon Helm singing it.

  26. Expect the south hate to only get worse as the economic gap between the northeast and the south and southwest widens. It goes right to their smugness.

    1. Indeed. This won’t help either.

    2. My head’s spinning after reading that Slate article. I can’t keep up with my own stereotypes.

    3. Realtalk in the comments:

      If you don’t like the way the South votes, you have noone but yourself to blame. After all, they tried to quit and go off by themselves, but the Northeastern Liberals fought a war to keep them around.

      That’s a high-quality slap right there.

  27. Why won’t anyone take us seriously?

  28. US stocks down 3% – maybe they’ll tick back up once the European markets close.

  29. Diabolically ingenius but I’m not actually sure the left is that smart.

    Only one of them has to be that smart. The rest will just do what he says?if it’s passed along by the Right Sort and surrounded with trigger words.

    “Dixie!”

  30. In order to cut the budget to revenue without cutting social programs like Dems want, we’d have to cut everything else. That is, everything else…. No defense budget, no Department of Ed/HS/Energy/Ag/Justice/Space/Commerce/Labor/Treasury/Interior, no EPA, NSF, Corps of Engineers/SBA, or any discretionary spending. And even then, we’d still be spending more than current revenue.

    Looking at it from the other side, we could cut Social security, Medicare and Medicaid, and be below revenue.

    I know neither situation is going to happen, but the first option, preserving the three big social programs, and cutting spending to revenue, is simply not possible. Democrats that insist that those three programs are strictly off limits are not playing with a full deck.

    1. Exactly.

      “non-discretionary” spending is in fact wholly discretionary.

    2. Democrats are under the delusion that we can tax our way out of this mess by going after the richers!

      1. Rifle a rich man’s pockets a day keeps poverty at bay.

    3. That is, everything else…. No defense budget, no Department of Ed/HS/Energy/Ag/Justice/Space/Commerce/Labor/Treasury/Interior, no EPA, NSF, Corps of Engineers/SBA, or any discretionary spending.

      That thought gives me a boner.

    4. Solution:

      1) Cut defense and everything else to the bone.

      2) Let the provincial Chinese government execute our poor, liberal, and/or elderly.

      3) Kick the Chinese out, thus giving a new generation a War for Independence and all that jazz.

      4) Profit.

      Of course, if cutting defense is not feasible, there’s always plan B:

      1) Cut everything but defense and the big entitlements.

      2) Ha ha ha, those suckers just cut the IRS. Let’s all stop paying taxes.

      3) Collapse of U.S. government. Return to Articles of Confederation.

  31. “Michael Lind is… the author of “The Next American Nation: The New Nationalism and the Fourth American Revolution.”

    Wait, when did the 2nd and 3rd revolutions happen?

    1. 1860 and 1932?

    2. I’m guessing the second one led to the Civil War.

      Or maybe the first one was swapping out the Articles of Confederation for the Constitution, and the Civil War was number 2.

  32. Right now, “cuts” mean reductions in the growth of future spending

    …in some imaginary future.

  33. “Also: it’s the “neo-Confederate” Tea Party “fanatics” who are threatening to “destroy America’s credit rating unless the federal government agrees to enact Dixie’s economic agenda.”

    If the left keeps this up, they’ll make neo-Confederate attitudes sexy again. They’ve already got the rebel thing going for them. But I’d rather be a Browncoat, since you can only be accused of nerdery, not racism.

    1. Plus, as a browncoat, I’d get to chill with Malcolm Reynolds. And probably die, given that his whole squad did just that.

    2. Plus, as a browncoat, I’d get to chill with Malcolm Reynolds. And probably die, given that his whole squad did just that.

    3. …since you can only be accused of nerdery

      Where I’m from that’s a hangin offense.

      1. Where you’re from, does nerdery require mens rea?

  34. We’re DOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOMED

  35. What the hell was that German word again?

    Oh yeah

  36. Contradicting the mainstream media narrative that the Tea Party is a new populist movement that formed spontaneously in reaction to government bailouts or the Obama administration, the facts show that the Tea Party in Congress is merely the familiar old neo-Confederate Southern right under a new label.

    What movement is the one that does not want the South to secede but wants to kick New England out?

    1. Let’s keep New Hampshire

      1. Casualty of war.

        1. Can we make Vermont collateral damage?

          1. Aw’ come on now, you know you find the granola hippies amusing

            1. The west has that constituency covered. We can lose Vermont and still retain our voting block.

  37. gross domestic project

    ?

    …you mean like cleaning out the cat’s litterbox?

    1. I lol’d.

  38. So the South is more conservative than New England. Who knew?

  39. US debt shot up $238 billion to reach 100 percent of gross domestic project

    Really?

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