I remember reading Kondratieff almost 20 years ago and being blown away. NDD, you are really the only guy I know that truly utilizes his stuff in the writings. Question, do you believe we are also heading into a new 40-year cycle?
America Must Pull Out of NAFTA and the WTO to SURVIVE..
It seems none of President Obama's CFR Globalist appointments understands the real problem.
Yes, most of the American Banks are collapsing all around us because these Banks hold Mortgages on these Houses where the Values have fallen far below the amount of the Bank Mortgage.
Ouch.. That means most of these Banks are maybe holding $100K mortgages on millions of houses where the house values have fallen to maybe $50k.
President Obama and all his Globalist men are running around in circles trying to save all these Banks from defaulting because if these Banks are allowed to default the Federal Government will totally collapse and absolutely falls off into the abyss.
This is a big problem of course. But, this is merely a symptom of the real problem that caused this Humongous Financial Problem.
So, then what was the REAL THING that caused this Financial Problem?
This all started back in 1992 and 1993 when America joined NAFTA and the WTO.
That was the beginning of the end for America.
The Globalist had finally bought off most of our American politicians and the swishing sound you heard was all the highest paying American jobs was moved to Mexico and then later when China joined the WTO, they started to moving all the highest paying jobs off to China to hire slave Labor at $2/day.
Now you ask. How would NAFTA and the WTO cause so much Financial Problems?
Please tell me what happens when you have a $100k mortgage on a house and your job gets sent off to China.
You are forced to take a job flipping Hamburgers at McDonalds at minimal wages if you’re lucky.
You have taken a cut in pay of maybe $15/hour. But, you’re still on the hook to pay off that $100k house mortgage payment. So, you start using your Credit Card and before long you have maxed out your Credit Card.
Now what are your options?
You keep falling further and further behind then at some point you are forced to default on your house payment and the house goes back to the Bank to satisfy the Bank Mortgage.
Now, since this exact same thing is happening to millions of American Workers all across America from all these high paying jobs being moved off shore to Mexico and China.
The Banks are overwhelmed when all these house owners go into default on their mortgages, then all the Banks start to losing humongous amounts of money. Then the Federal Reserve gets involved trying to save all these Banks from default.
The next thing happens is that all these Real Estate Properties start to come on the market and the Property Values all across America start to falling big time.
Now, that creates another problem. What should a home owner do if he owes $100k mortgage on a house and the value of the house falls to $50k?
Of course if you’re laid-off because your Job was moved to China, you’re forced to default on the house mortgage. Default is totally understandable.
What about the guy who has a good job and can afford to make his monthly house payments?
Why should he agree to make payments on $100k mortgage, when the house is only worth $50k? So, he walks away from the huge $100k mortgage and lets the Bank eat it.
Some of these houses in Florida, two years ago was worth $150K and now can be purchased for $60K from the local Bank.
Now, let’s go back to the real problem.
If the Real Problem is never addressed and all those jobs that was sent off shore are not brought back to American, then all these Trillion Dollar Bailouts will just cause a false temporarily product demand for a short period of time.
Then America will be right back in the soup again.
Except this time the problem will be exponentially worse because we now owe all those Trillions of Dollars in Bailout loans from China plus the Interest Payments too.
You really do not have to worry because if all them jobs are not brought back to America from China soon. America will go into a total collapses.
Then at some point the American People will finally figure this out and get really p-i-s-s-e-d off at the Federal Government. I want a remind you they are all armed to the teeth and I promise you they will not give up their Personal rights and Freedom very easily.
So, that’s exactly where we are right now and where we are going to stay until all those highly intelligent Harvard graduates give up on this Globalize Free Trade and that great ONE WORLD ORDER and bring back all of them high paying jobs from Mexico and China.
What really makes all of this so sad is that all of Trillions Dollar Bailout is totally unnecessary. If American would pull out of NAFTA and the WTO right now everything would start to correct all by it’s self automatically.
Let me finalize my argument by saying.
World Globalization will never work like they planned because if all of the higher paying Jobs are moved off shore to China where the worker is paid slave labor of $2/day.
The Middle Class Workers of all the Industrialized Countries will be living on the street and the workers in China will not make enough money to purchase the vary products they produce.
Now, Please tell me who in the hell is left to purchase all those products being produced by $2/day slave labor in China?
which is seriously regressive and doesn't address reducing the import/export imbalance.
But the flat tax does tax the underground economy, which is massive in the United States.
Considering we have a society which loves cheap labor, including cash under the table, plus all of the drug money and all of the rest of the underground economy that's under the table, capturing their "fair share" isn't such bad idea...
i.e.. employers can use illegal labor and pay them cash under the table to avoid various payroll taxes as well as income taxes (more FICA, SS).
The anti-tax crowd I think is driven by lobbyists and misinformation too. Like the focus on the estate tax instead of a focus on FICA or Social Security/Medicare..which are regressive.
This is precisely what I am trying to amplify and why a "consumption tax" should not necessarily be the label on VATs.
VAT countries, via a WTO ruling, get a rebate on all VAT when they export that good.
That good comes into the United States untaxed because we do not have a VAT on imports. That gives the total price of the import an unfair advantage over US goods where our taxes are distributed already onto that particular competitive item.
In addition, the United States, when exporting, is levied the VAT of the importing country. That makes the US goods much higher in price, beyond the production costs and is a under the table tariff in so many words on U.S. goods.
The United States taxes get no WTO sanctioned rebate on anything. So that added cost makes goods produced in the U.S. and exported non-competitive.
Never mind the U.S. is not collecting any taxes on imports....something the EU and China as I understand it ....love.
b) Keynes' theories were proven inadequate by the stagflation of the 1970's,
I had always understood that the primary causes of the 70's stagflation were the Vietnam war debt, and the rapid spikes in energy costs resulting from the oil embargos.
The increase in the M3 money supply when Nixon removed the final vestiges of the gold standard played a role as well.
Is this not entirely correct? or oversimplification?
I am surprised the anti- tax crowd hasn't siezed on the idea of the VAT or tariff as a possible replacement for the income tax
Afterall, prior to the income tax the US govt got most of its revenue from tariffs
Personally I would like to see a tariff on imports implemented - the proceeds could be used to bolster the social safety net for those harmed by unfair trade, used for increased border security and safety inspection of imported goods, and most importantly used to pay down the national debt, and make us less beholden to foreign creditors
I work for a mfg company that makes automation components.
Here is a real life example of how foreign VATs and the lack of a US VAT hurts exporting US based companies and help iporting foreign based companies.
We make a type of clamp used in auto assembly. Lets assume we have the same material and shipping costs as our chinese "competitors" now of coure we know this to not be entirely coreect but will assume so for the sake of the exercise. Now of course their labor is much less than ours, and we have the engineering and development costs that they didn't have because they simply knocked off existing designs.
We try to xport to china - we get hit with a VAT in china that almost doubles our landed cost . this tax is then rebated to the exporting competitior, whose landed cost in the US is half our cost since we are not charging a reciporical VAT or tariff.
You can see now how this unilateral "free" trade arangement. hurts US based companies and favors foreing imports thus increasing the trade deficit
if we had reciporical VATS on imported goods that we then rebated to US exporters it should not take long to reduce the trade deficit significantly
A VAT would be a good thing - if it means that the vast majority of America tax payers need not file income tax returns or deal with the increasingly incomprehensible Federal tax code. If combined with a progressive income tax on the top 5 to 10% of earners, the VAT stands to be of great benefit. It is something we need to do.
Seebert, you have not bothered to read the references or past posts or reference them. Now I am not going to deal with some useless argument and I'm also now brazenly telling you, unless you write up a detailed aggregate analysis in counter to those papers, this is beyond absurd and not within EP rules. I said I would later write up a more detailed analysis but responding to this basically harassment is really on thin ice. EP is about economics and whatever this is, is not that.
I've yet to see one that convinces me that they are effective policy, in fact, near as I can tell they hurt the end generators of the real economy. An employer can't employ anybody at all if he doesn't have consumers to sell to- consumption is what drives both small and large businesses to profit. Without consumptionof their goods, there is no reason to create more goods.
Any given corporation worth it's salt is going to pass on any tax overhead to the consumer anyway- so if we tax consumption, who are we really hurting?
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
is it about objective analysis on what is the most effective policy, where is the economy going, economic indicators, housing an all of the rest.
Personal anecdote has little insight on macro economics, international tax policy and unfair advantage, incentives to play differing economies and nation-states off of each other, global consumer markets, etc.
As far as overall taxes goes, one needs to look at the aggregate, what is the real PPP (standard of living) and what is the real amount of net income (after total taxes income). Not just focusing in on one type of tax and "freaking out" about it. Tax policy does affect multinational corporations and their decisions and also affects small business, not just the individual. They are also the employers, the generators of the real economy.
We're damn good at having enough natural resources to feed, clothe, and shelter our people.
But in the last 40 years, we've almost entirely given up on the ability to turn those natural resources into finished products. Our industrial capacity is shrinking every year- and every year we make fewer end-user products.
I think this depression gives us a chance to reset- but any way we do it is going to be hard.
That's why the WTO has us by the balls- we'd lose our market for Natural Resources, and we don't have the capability any more to use those natural resources domestically.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
But you are right, the WTO sucks and rules against the U.S. continually. This would make another great post, what if the U.S. said "screw you WTO" and plain pulled out? What are the economic ramifications to the United States? I'm not big on hurting people, esp. working people from making a buck but I do not believe I have seen such an analysis, objectively.
Anyway, that's why I'm paying attention to the VAT, it's all about the "at the border" tax and the WTO.
It's because the WTO is hopelessly biased against cultures like mine here in Oregon, where we don't like indirect taxes.
Yet another reason to dump the WTO, rather than accept their bigotry and force us to change our culture.
Now off to read Pat Choate's book and see if he's got a reason for being bigoted against direct taxes beyond mere philosophy.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
"The three-year housing decline is proving resistant to efforts by the Federal Reserve and the Obama administration to keep homeowners current on mortgages by allowing them to refinance or sell to buyers enticed by affordable terms. Prime fixed-rate home loans to the most creditworthy borrowers accounted for the biggest share of new foreclosures at 29 percent, MBA said, a sign job losses are hurting homeowners."
The solution is in job creation and wage stabilization - not pushing real estate.
So, increased costs are a tax? Is this like some press release trying to get the tax crowd (stop taxing us) to pay attention by framing it in such fashion?
On average, the uninsured paid more than 37 percent of their health-care costs themselves, the report said. Government programs and charities paid for 26 percent of care, the report said.
Milliman estimated about $42.7 billion in health-care costs were unpaid in 2008. Those costs were shifted to insurers in the form of higher charges for health services, Families USA said. The charges were passed on to families and businesses as higher premiums, the group said.
“We do cost-shift wherever we can,” said Larry S. Gage, president of the National Association of Public Hospitals, at the news conference. Gage said his group of 100 hospitals, including those under New York City Health and Hospitals Corp., handle 20 percent of all the uncompensated care in the U.S.
so what I think they are talking about is benefits are not taxed but when they force workers to pay out of pocket, that income which is now going to benefits is now taxed.
Very confusing article in this day and age of quick information scan!
I remember reading Kondratieff almost 20 years ago and being blown away. NDD, you are really the only guy I know that truly utilizes his stuff in the writings. Question, do you believe we are also heading into a new 40-year cycle?
--------------------------------------------
www.venomopolis.com
America Must Pull Out of NAFTA and the WTO to SURVIVE..
It seems none of President Obama's CFR Globalist appointments understands the real problem.
Yes, most of the American Banks are collapsing all around us because these Banks hold Mortgages on these Houses where the Values have fallen far below the amount of the Bank Mortgage.
Ouch.. That means most of these Banks are maybe holding $100K mortgages on millions of houses where the house values have fallen to maybe $50k.
President Obama and all his Globalist men are running around in circles trying to save all these Banks from defaulting because if these Banks are allowed to default the Federal Government will totally collapse and absolutely falls off into the abyss.
This is a big problem of course. But, this is merely a symptom of the real problem that caused this Humongous Financial Problem.
So, then what was the REAL THING that caused this Financial Problem?
This all started back in 1992 and 1993 when America joined NAFTA and the WTO.
That was the beginning of the end for America.
The Globalist had finally bought off most of our American politicians and the swishing sound you heard was all the highest paying American jobs was moved to Mexico and then later when China joined the WTO, they started to moving all the highest paying jobs off to China to hire slave Labor at $2/day.
Now you ask. How would NAFTA and the WTO cause so much Financial Problems?
Please tell me what happens when you have a $100k mortgage on a house and your job gets sent off to China.
You are forced to take a job flipping Hamburgers at McDonalds at minimal wages if you’re lucky.
You have taken a cut in pay of maybe $15/hour. But, you’re still on the hook to pay off that $100k house mortgage payment. So, you start using your Credit Card and before long you have maxed out your Credit Card.
Now what are your options?
You keep falling further and further behind then at some point you are forced to default on your house payment and the house goes back to the Bank to satisfy the Bank Mortgage.
Now, since this exact same thing is happening to millions of American Workers all across America from all these high paying jobs being moved off shore to Mexico and China.
The Banks are overwhelmed when all these house owners go into default on their mortgages, then all the Banks start to losing humongous amounts of money. Then the Federal Reserve gets involved trying to save all these Banks from default.
The next thing happens is that all these Real Estate Properties start to come on the market and the Property Values all across America start to falling big time.
Now, that creates another problem. What should a home owner do if he owes $100k mortgage on a house and the value of the house falls to $50k?
Of course if you’re laid-off because your Job was moved to China, you’re forced to default on the house mortgage. Default is totally understandable.
What about the guy who has a good job and can afford to make his monthly house payments?
Why should he agree to make payments on $100k mortgage, when the house is only worth $50k? So, he walks away from the huge $100k mortgage and lets the Bank eat it.
Some of these houses in Florida, two years ago was worth $150K and now can be purchased for $60K from the local Bank.
Now, let’s go back to the real problem.
If the Real Problem is never addressed and all those jobs that was sent off shore are not brought back to American, then all these Trillion Dollar Bailouts will just cause a false temporarily product demand for a short period of time.
Then America will be right back in the soup again.
Except this time the problem will be exponentially worse because we now owe all those Trillions of Dollars in Bailout loans from China plus the Interest Payments too.
You really do not have to worry because if all them jobs are not brought back to America from China soon. America will go into a total collapses.
Then at some point the American People will finally figure this out and get really p-i-s-s-e-d off at the Federal Government. I want a remind you they are all armed to the teeth and I promise you they will not give up their Personal rights and Freedom very easily.
So, that’s exactly where we are right now and where we are going to stay until all those highly intelligent Harvard graduates give up on this Globalize Free Trade and that great ONE WORLD ORDER and bring back all of them high paying jobs from Mexico and China.
What really makes all of this so sad is that all of Trillions Dollar Bailout is totally unnecessary. If American would pull out of NAFTA and the WTO right now everything would start to correct all by it’s self automatically.
Let me finalize my argument by saying.
World Globalization will never work like they planned because if all of the higher paying Jobs are moved off shore to China where the worker is paid slave labor of $2/day.
The Middle Class Workers of all the Industrialized Countries will be living on the street and the workers in China will not make enough money to purchase the vary products they produce.
Now, Please tell me who in the hell is left to purchase all those products being produced by $2/day slave labor in China?
which is seriously regressive and doesn't address reducing the import/export imbalance.
But the flat tax does tax the underground economy, which is massive in the United States.
Considering we have a society which loves cheap labor, including cash under the table, plus all of the drug money and all of the rest of the underground economy that's under the table, capturing their "fair share" isn't such bad idea...
i.e.. employers can use illegal labor and pay them cash under the table to avoid various payroll taxes as well as income taxes (more FICA, SS).
The anti-tax crowd I think is driven by lobbyists and misinformation too. Like the focus on the estate tax instead of a focus on FICA or Social Security/Medicare..which are regressive.
This is precisely what I am trying to amplify and why a "consumption tax" should not necessarily be the label on VATs.
VAT countries, via a WTO ruling, get a rebate on all VAT when they export that good.
That good comes into the United States untaxed because we do not have a VAT on imports. That gives the total price of the import an unfair advantage over US goods where our taxes are distributed already onto that particular competitive item.
In addition, the United States, when exporting, is levied the VAT of the importing country. That makes the US goods much higher in price, beyond the production costs and is a under the table tariff in so many words on U.S. goods.
The United States taxes get no WTO sanctioned rebate on anything. So that added cost makes goods produced in the U.S. and exported non-competitive.
Never mind the U.S. is not collecting any taxes on imports....something the EU and China as I understand it ....love.
This is under WTO GATT.
I had always understood that the primary causes of the 70's stagflation were the Vietnam war debt, and the rapid spikes in energy costs resulting from the oil embargos.
The increase in the M3 money supply when Nixon removed the final vestiges of the gold standard played a role as well.
Is this not entirely correct? or oversimplification?
I am surprised the anti- tax crowd hasn't siezed on the idea of the VAT or tariff as a possible replacement for the income tax
Afterall, prior to the income tax the US govt got most of its revenue from tariffs
Personally I would like to see a tariff on imports implemented - the proceeds could be used to bolster the social safety net for those harmed by unfair trade, used for increased border security and safety inspection of imported goods, and most importantly used to pay down the national debt, and make us less beholden to foreign creditors
I work for a mfg company that makes automation components.
Here is a real life example of how foreign VATs and the lack of a US VAT hurts exporting US based companies and help iporting foreign based companies.
We make a type of clamp used in auto assembly. Lets assume we have the same material and shipping costs as our chinese "competitors" now of coure we know this to not be entirely coreect but will assume so for the sake of the exercise. Now of course their labor is much less than ours, and we have the engineering and development costs that they didn't have because they simply knocked off existing designs.
We try to xport to china - we get hit with a VAT in china that almost doubles our landed cost . this tax is then rebated to the exporting competitior, whose landed cost in the US is half our cost since we are not charging a reciporical VAT or tariff.
You can see now how this unilateral "free" trade arangement. hurts US based companies and favors foreing imports thus increasing the trade deficit
if we had reciporical VATS on imported goods that we then rebated to US exporters it should not take long to reduce the trade deficit significantly
A VAT would be a good thing - if it means that the vast majority of America tax payers need not file income tax returns or deal with the increasingly incomprehensible Federal tax code. If combined with a progressive income tax on the top 5 to 10% of earners, the VAT stands to be of great benefit. It is something we need to do.
Seebert, you have not bothered to read the references or past posts or reference them. Now I am not going to deal with some useless argument and I'm also now brazenly telling you, unless you write up a detailed aggregate analysis in counter to those papers, this is beyond absurd and not within EP rules. I said I would later write up a more detailed analysis but responding to this basically harassment is really on thin ice. EP is about economics and whatever this is, is not that.
For consumption taxes?
I've yet to see one that convinces me that they are effective policy, in fact, near as I can tell they hurt the end generators of the real economy. An employer can't employ anybody at all if he doesn't have consumers to sell to- consumption is what drives both small and large businesses to profit. Without consumptionof their goods, there is no reason to create more goods.
Any given corporation worth it's salt is going to pass on any tax overhead to the consumer anyway- so if we tax consumption, who are we really hurting?
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
is it about objective analysis on what is the most effective policy, where is the economy going, economic indicators, housing an all of the rest.
Personal anecdote has little insight on macro economics, international tax policy and unfair advantage, incentives to play differing economies and nation-states off of each other, global consumer markets, etc.
As far as overall taxes goes, one needs to look at the aggregate, what is the real PPP (standard of living) and what is the real amount of net income (after total taxes income). Not just focusing in on one type of tax and "freaking out" about it. Tax policy does affect multinational corporations and their decisions and also affects small business, not just the individual. They are also the employers, the generators of the real economy.
And you've stated it elsewhere.
We're damn good at having enough natural resources to feed, clothe, and shelter our people.
But in the last 40 years, we've almost entirely given up on the ability to turn those natural resources into finished products. Our industrial capacity is shrinking every year- and every year we make fewer end-user products.
I think this depression gives us a chance to reset- but any way we do it is going to be hard.
That's why the WTO has us by the balls- we'd lose our market for Natural Resources, and we don't have the capability any more to use those natural resources domestically.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
But you are right, the WTO sucks and rules against the U.S. continually. This would make another great post, what if the U.S. said "screw you WTO" and plain pulled out? What are the economic ramifications to the United States? I'm not big on hurting people, esp. working people from making a buck but I do not believe I have seen such an analysis, objectively.
Anyway, that's why I'm paying attention to the VAT, it's all about the "at the border" tax and the WTO.
It's because the WTO is hopelessly biased against cultures like mine here in Oregon, where we don't like indirect taxes.
Yet another reason to dump the WTO, rather than accept their bigotry and force us to change our culture.
Now off to read Pat Choate's book and see if he's got a reason for being bigoted against direct taxes beyond mere philosophy.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
Why you think the way to equalize trade is to penalize consumption.
That isn't about VAT in specific and it isn't about misunderstanding- because VAT *does* tax consumption.
It's a question about why YOU think that's the way to go.
-------------------------------------
Executive compensation is inversely proportional to morality and ethics.
h/t CR
from Bloomberg
"The three-year housing decline is proving resistant to efforts by the Federal Reserve and the Obama administration to keep homeowners current on mortgages by allowing them to refinance or sell to buyers enticed by affordable terms. Prime fixed-rate home loans to the most creditworthy borrowers accounted for the biggest share of new foreclosures at 29 percent, MBA said, a sign job losses are hurting homeowners."
The solution is in job creation and wage stabilization - not pushing real estate.
So, increased costs are a tax? Is this like some press release trying to get the tax crowd (stop taxing us) to pay attention by framing it in such fashion?
The hidden tax is in the form of cost-shifting.
so what I think they are talking about is benefits are not taxed but when they force workers to pay out of pocket, that income which is now going to benefits is now taxed.
Very confusing article in this day and age of quick information scan!
Insured in U.S. Paid 'Hidden Health Tax'
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