Is America heading into another depression?

america is over 14.3 trillion in debt, apparently that is enough to stack dollar bills to the moon and back, twice.

I say it is

I think that the entire world is heading for a big depression…. fast and furious. The €uro zone is trashed, the U$-Economy is trashed and the ¥en isn’t feeling very well either.

well thats not exactly the whole world is it now? :\

The way all the world currencies are interconnected should the US, EU, and Japanese markets melt down it would affect every person in the world except subsistence farmers and barterers.

Americans face a lower standard of living. They say my generation of Americans, late baby boomers, are the first generation of Americans to do worse than their parents. Unfortunately I don’t think we will be the last. In most ways my dad with just a high school education and willingness to work hard has done better than I have with a college degree and being in the top of my field as a professional. It is getting harder and harder for kids to get ahead. When I started college tuition for full time classes at a state university cost less than taking one class at a community college for my step-daughter. I worked my way through school as a bookstore clerk, cook, temp, retail, and other unskilled jobs. Unskilled jobs today pay about the same as they did when I worked them 30 years ago but the price of tuition has gone through the roof and living expenses have also gone way up. Today it is almost impossible for kids to work their way through college like I did so unless they are from a wealthy family the solution is to take out loans. Most graduates today start life with the equivalent of a home mortgage just from student debt so when will they be able to buy a home or a new car? Not only that but a lot of college grads can’t even get a decent job. I have a niece with her degree and the best job she can find is retail manager and she can barely cover her living expenses let alone pay back her loan. She recently had to move back in with her parents. Even most people with decent jobs are effectively broke. Their assets are the equity in their home (if they still have any) and their 401(k) and chances are their debts cancel out their assets. This is because the only way to maintain the standard of living they feel they deserve is to borrow instead of save. Before 1980 most households got by with one breadwinner. After 1980 most have needed both parents to work to get by. Because of this latch key kids are raised by school and TV instead of their parents. Now we have a generation of latch-key kids who are kids of latch-key kids and think of this as normal. Old-timers like me remember having mom making hot breakfast every morning, having dinner ready every evening, and actually talking instead of burying our heads in electronics. My parents used to buy quality furniture made in America of real wood. I only have one piece of furniture that is that sort of quality. It is an Amish made desk. It us me back $4,000. Love the desk but there is no way I could afford to furnish my whole house with furniture like that. Most of my furniture is made of particle board, in China, and will at best last a few years. My prediction for our future is that eventually nearly everyone will work for Walmart. We will live in cheap fiberboard Walmart homes that we replace every few years and use cheap cardboard Walmart furniture that only lasts a few years and drive cheap Walmart cars that we won’t even be able to open the hood on because we just drive them a few years until they break and get another. Nobody outside of the gilded few will be able to afford anything durable or quality. Everything will simply be a cheap facsimile of things people used to have.

most likely

The Mafia would sure find a way to make profit from it, too.

maybe we should, so that those “politicians” at Washington, learn how to run a country

The national debt as a percentage of GDP peaked after WWII. American recovered from that debt and we can recover from this one. Our nation obviously can’t keep spending more than it takes in forever. The choice is to either raise taxes; especially on the wealthy and on corporations or to cut services that most Americans depend on. Consider that $1.6 trillion of our debt was caused by the Bush tax cuts. Republicans forcing President Obama to extend Bush’s tax cuts cost another $400 billion. $1.3 trillion was our unfunded wars in Afghanistan and Iraq (with $trillions more in legacy cost coming in the future). Bush’s prescription medication benefit which was basically a government giveaway to pharmaceutical companies $300 billion. One of the reasons I find Republicans disingenuous about the debt is that there was no outcry over the $3.6 trillion in debt Republicans recently ran up but the world is ending because President Obama spent $800 billion trying to keep our economy from sinking into another depression. Tax burden has been shifting away from business to citizens for the last 60 years and while the percentage of income the top percentiles collect has increased several fold the percentage of tax revenues they contribute has gone down. Since the wealthy get much of their income from inheritance and capital gains which are taxed at a lower rate than income we have situations like Warren Buffet who is the 3rd wealthiest person in the world pays a lower percentage of his taxes than his secretary. Not only this but one of the goals of many Republicans is to eliminate taxes on inheritance (or death tax as they call it) and on capital gains permanently.

Here’s the problem. All money in the United States is created at a debt to the people. The Federal Reserve buys treasury bills from the Federal Government with newly created money. The money is created at interest.. so for every 100 dollars created… 103 dollars are owed to the Federal Reserve… more or less depending upon the current interest rate the Fed has set for its loans. Since the United States has decided to enforce the Federal Reserve’s note as the sole medium of exchange in this country… all loans must be repaid in them. Since the 103 dollars owed to the Federal Reserve must be collected from a pool of the 100 actual dollars in existence… it is impossible to repay the loan. To cover the debt for the time being… we must take another loan… which then creates a bigger debt down the road. More and more money being created by the Fed Reserve causes a surplus of money in the system which diminishes the purchasing power of that money. This is known as inflation. Since the creation of the Federal Reserve Bank… the purchasing power of the Federal Reserve Note has decreased by about 98%

To combat the effects of inflation while still trying to maintain their profit levels… manufacturers sent many jobs overseas to areas with lowered standards of living to reduce their production costs in order to keep prices at affordable levels. Over time this has transitioned the United States into a service centered economy… which is untenable.

The offshoring of jobs in addition to the rise of inflation and mounting public debt has left us where we are today… facing both a depressed economy and inflated prices.

No amount of stimulus money can stimulate growth… this is the broken window fallacy of Keynesian economics. You cant stir growth in one sector by taking from another… all gains in one are forfeit in another. TARP was just a scheme dreamt up by the bankers to scare us into forgiving them their financial transgressions. Any bank too big to fail… is too big. If our livelihoods are at the mercy of bankers to behave responsibly and equitably… then we have gotten ourselves into one helluva predicament.

There is one solution. To shutter the Federal Reserve and to forgive the US govt the debt owed them. This is only one facet of the current financial situation… but it is at the heart of the matter. Before the Federal Reserve we got by through capital gains taxes and tarifs and by taxing certain goods. There is no reason that we should think as though the Federal Reserve is off limits. It is a bane on society. Ron Paul has called for its charter to be pulled. This is why all of the corporate media outlets are doing their best to marginalize his candidacy.

GM started shipping jobs overseas while they were still very profitable. Corporations are not charities; they answer to nobody but shareholders and exist only to maximize profits. If a corporation can make a few dollars more by sending jobs overseas it is their economic imperative to do so regardless of how they or the economy is doing. Shipping jobs overseas has the combined effect of raising other countries standard of living while lowering ours. Unless we want to enjoy a 3rd world standard of living we need some protectionist measures to keep jobs and money within our boarders. As far as Keynesian economics goes; nearly everyone is a Keynesian. President Reagan broke the stagflation and economic malaise of the 1970’s by going on a massive spending program and increasing our debt from 26.1% of the GDP in 1980 to 41.0% of the GDP by 1988. President Carter on the other hand showed fiscal restraint when the economy needed stimulation and had a small surplus in his tenure but this did not strengthen our economy. The biggest problem with deficit spending is having to pay it back. We have been very good at the spending part but paying it back has been a challenge. Note that when the economy was rolling Reagan raised taxes but not enough to cover expenditures. After his deficit spending worked federal spending should have been cut back and taxes raised to pay down the money he spent. This wasn’t done through the Regan and Bush 41 presidencies. President Clinton, on the other hand, did begin to pay it down. He scaled the federal government back to the lowest level it had been since JFK was in office and modestly raised taxes leading to a surplus without putting the breaks on the economy. If Bush 43 hadn’t squandered the Clinton surplus and spent us into the ground, spending a few $trillion now to stimulate the economy could have easily been done. Keynesian economics has worked many times. The economy has been great during most wars because the increase in government spending stimulated the economy. Like I said elsewhere, we have deficits because the Republicans like deficits. Gorver Norquist outlined his strategy to eliminate entitlement programs he is philosophically opposed to. He said not to take the unpopular position of cutting popular social programs like Social Security, Medicare, Medicaid, etc. He said to take the popular position of tax cuts that will cause a financial necessity of cutting these programs. I’ve always liked Ron Paul. Unlike most politicians he is not duplicitous; he usually says what he means and means what says. He is refreshing compared to the hypocriticy that is endemic in politics. However, he is a kook. A likeable kook but a kook none the less. Going from fiat money to hard money would reduce the money supply to the point where our economy would fall off a cliff. There is simply no way to get there from here.

“The economy” is not a force of nature; it is a function of our cumulative individual actions - and of our collective action, because there is no economy separate from the politics of it.

In other words, whether America falls into an economic depression depends on whether you (and you, and you…) and I can get free enough of the cultural depression that’s got us paralyzed, to get out there and change things.

Talk with your friends about what’s gone wrong. Visit your elected representatives.

Occupy Wall Street!

haha im not american :3

Oops, lol, my slip is showing {=^o

lol i dont want it to go into another great depression but your ryt these guys need to learn how to run a country!

Firstly… as I have reminded Jimahl and others… Clinton never ran a surplus. The numbers are there for anyone to review. The deficit grew every year he was in office… though not as greatly some years as had been before… still… the deficit grew… so this is a misnomer that has been disproven. We have deficits because we have a debt based economy. Every dollar is printed at interest. This is simple to understand… as you so flippantly characterized him… even a so called kook can pick up on this. Ad hominems are a way of conceding the argument… by the way. What keynesians fail to understand is that by inflating the money system they artificially create a bubble that is poised to burst… as it is literally based on nothing. The law of supply and demand can be momentarily disrupted by artificial means… but it will be corrected at some point in the future… creating the tell tale boom/burst cycles inherent to debt based systems. Any economic boom created thusly is enjoyed on borrowed time… borrowed from the wealth of the future… as can be observed now. The broken window fallacy explains how shuffling money around cannot create wealth. Breaking a window or going to war is actually counterproductive.. because you take something of inherent value and destroy it in order to stimulate growth in another sector. You can show the results of the destruction as a handyman repairing the broken window… or of contractors hiring workers to build more weapons or infrastructure as growth in those sectors… but keynesians fail to consider the destruction of valuable materials to necessitate their replacement. The results of keynesian economics and debt based money has gotten us where we are today. The notion that a realignment of the money system would be disastrous to the economy is absurd. Money is simply a method of assigning value to goods and services. Those goods and services will simply require a different amount of money. Our money will have something of inherent value backing it… facilitating the growth of real wealth.