The Emerging Budget Deal

For nearly forty years the Responsible Faction has told us that balancing the budget ‘this year’ would bring about the collapse of civilization. ‘But soon, yes, in a few years, we will balance it. But not now: Banks would be embarrassed, the economy would collapse. Millions would die.’

If we had ignored the Responsible Faction 35 years ago, balanced the budget, suffered the short term problems, and continued to ignore the Responsible Faction, we’d be in far better shape today.

Instead, we submitted to the Responsible Faction’s wisdom, because they spoke with great gravitas and wore expensive suits and had impressive credentials and spoke with great authority and now we have over twenty trillion dollars in federal debt which very likely will be paid off with highly inflated dollars which crush the value of our own savings into worthlessness.

Then we will find out that the experts were every one of them marching stark naked in a blizzard and no one had paid attention to the foolish children snickering and pointing and exclaiming at the naked fools in the snow.

So let the federal government run out of money, and grimly rejoice as Department after department shuts down and interest on the debt is unpaid as that would would do the best of all things: drive the federal government out of the credit markets for decades. There is no good way out of the mess we voters and non-voters alike have created for ourselves, and we are the ones who should suffer for our irresponsible voting habits and submission to the Wisdom of Experts. Better sooner than later, when the debt is forty trillion or fifty, because we were too foolish and submissive to bring down the Experts when the debt was three trillion, or when it was five trillion, or when it was ten trillion, or even fifteen.

If we continue to submit to the Wisdom of Experts with Gravitas, the eventual result may make the Terror of the French Revolution look mild, and none of us needs that.

WaPo on the emerging budget deal.

The Slow Overnight Collapse of Venezuela

This is the best short description I've seen recently about the industry by industry collapse of Venezuela -once the richest country in South America- into...well...collapse like tin foil hat wearing preppers worry about. It can take many years for a prosperous country to fall apart, it just looks sudden at the end. No toilet paper, refrigerators are worthless because there is electricity only two days a week, but that's really OK because there is no food to put in the non-working refrigerators.

Now they don't even have enough money to pay for printing more inflationary currency, and the foreign printing companies which were flying it in, in fleets of 747s, have stopped because Why trust Venezuela to pay the printing and shipping bills?

Between corruption and Marxism, and corrupt Marxism, and Marxist corruption, the Venezuelans have well and truly buggered each other left, right, and upside down. Right along with all the good, decent people who did NOT vote this calamity.

Honolulu Teachers Are The Worst Paid In America, Milwaukee's The Best

The Hawai'i Free Press has this from a report by the National Center for Policy Analysis:

When adjusted for cost of living, teacher...median adjusted salaries in the 60 metro areas range from $32,312 in Honolulu, Hawaii to $73,078 in Milwaukee, Wisconsin. The national median salary for an elementary school teacher is $53,590.

No wonder Hawaii doesn't produce enough teachers, and can't keep the teachers hired from the Mainland. The cost for Mainland teachers to go home to visit family even once a year is one of the costs which may not be included in the cost of living. Tack on $600 to $850 for that item, just for airfare, out of an effective salary of $32,312.

The national median salary for an elementary school teacher is $53,590.

So just to reach the national median, Hawaii would have to increase the median teacher salary by roughly 65%. Imagine the taxpayer's response to that.

Also: Don't forget that while Hawaii teacher pensions get a 2.5% bump for inflation every year, the adjustment is applied only to the original amount of the pension and is not applied to the pension at the last raise: that is, it isn't compounded, only added to the original benefit. A couple of years of 5-8% inflation will devastate retirees, already the worst paid in America.

New Argentina Economic Collapse?

BUENOS AIRES, Argentina (AP) — Consumer prices are soaring, the treasury is running low on foreign currency and the peso has had its sharpest slide in 12 years. Instead of rioting, though, Argentines are falling back on tried and true survival skills to cope with the turmoil.

Inflation is at about 30 percent...

So some Argentines are hoarding dollars, while others stockpile goods or plow their savings into real estate.

More people ride bikes now following recent increases in public transportation fares. They eat less at restaurants and cook at home. They buy cheap, pirated DVD copies of the latest films rather than go to the cinema.

Is this where the US is heading?

Many Argentines note that the current economic woes are not as bad as Argentina's financial collapse in 2001-2002. Unemployment remains relatively low, and many people benefit from government handouts. Yet they worry the country may be at a tipping point.

That does sound familiar.

The presidential couple negotiated or paid off most of Argentina's defaulted debt, nationalized the pension system, and retook control of the national airline and oil company. They also kept energy cheap through subsidies and dug deep into the treasury to redirect revenue to the poor through handouts.

Quite familiar. The government robbed people's private pension plans to pay it's own debts: They robbed the savers at the point of the government's guns, and now wonder why people don't save money or invest.

Read the whole thing. I think it is where we are going.

The House Leaders Don't Deserve It

Drudge Report headline:

HOUSE LEADERS CAMPAIGN FOR AMNESTY

Federal Debt No Big Thing

How do I know that?

The President says so.

Then it must be true.

As Goes Argentina, So Goes US?

Argentines certainly like their economy to be screwed up.

In April, (Argentine President Cristina) Fernandez, who succeeded her late husband Nestor Kirchner in December 2007, seized control of (the country’s biggest oil producer) YPF from Spain’s Repsol SA, blaming lack of investment by her country’s biggest oil company for a doubling of fuel imports in 2011. During her first term, she expropriated $24 billion of private pension savings and nationalized Aerolineas Argentinas SA, the nation’s flagship airline.

So, she and her co-thugs robbed their own citizens subjects victims of $24,000,000,000, nationalized the major airline, and for some reason foreigners got leery of pouring more money into their reach. Now Fernandez has proven them right to be leery.

With Argentina locked out of global credit markets since its $95 billion default in 2001, Fernandez has tapped the bank’s holdings since 2010 to help pay the nation’s foreign debt. She plans to use $8 billion of reserves for the same purpose next year.

Argentina's government welched on their debts and is paying bills by spending capital robbed from their victims, but at least they have put Eva Peron back on their currency.

Argentina’s inflation data has been under question since early 2007, when Kirchner replaced senior staff at the national statistics agency. Last year the government fined more than a dozen researchers as much as 500,000 pesos ($107,000) each for reporting inflation rates that were higher than official data.

To avoid fines, economists now share their research with opposition lawmakers, who release a monthly report based on the data. The September report said prices rose 24 percent in August from a year earlier. Two days later, the statistics agency said annual inflation was 10 percent.

So, who do you trust? The government or your lying eyes?

Eliana Raszewski has more here at Bloomberg News.

Of Benjamin Franklin, Jonathan Holden, and Compound Interest

It seems that neither courts nor stiffed heirs like the last when carried to extremes.

N.B.: While the article refers to the donor's 1936 endowment of $2.8 million now being worth "an impressive $9 million", the BLS.com inflation calculator says that $2,800,000 in 1936 was equal to over $45,000,000 in 2011.