Plagued by seemingly perpetual debt problems due to large welfare states, the Euro-zone, the 17 countries that make up the European Union, has fallen into a recession for the second time since 2009:
The euro zone debt crisis dragged the bloc into its second recession since 2009 in the third quarter despite modest growth in Germany and France, data showed on Thursday.
The French and German economies both managed 0.2 percent growth in the July-to-September period but their resilience could not save the 17-nation bloc from contraction as the likes of The Netherlands, Spain, Italy and Austria shrank.
Economic output in the euro zone fell 0.1 percent in the quarter, following a 0.2 percent drop in the second quarter.
Those two quarters of contraction put the euro zone’s 9.4 trillion euro ($12 trillion) economy back into recession, although Italy and Spain have been contracting for a year already and Greece is suffering an outright depression.
A rebound in Europe is still far off. The debt crisis that began in Greece in late 2009 is still reverberating around the globe and holding back a lasting recovery.
Analysts said even the euro zone’s top two economies were likely to succumb in the final three months of the year.
As August 2nd approaches, stipulated by Treasury Secretary and tax cheat Timothy Geithner as the date when the U.S. will reach its statutory debt limit, our illustrious president, Barack Obama, becomes more and more unhinged. From highly partisan, contemptuous and fact-challenged press conferences, to his angry and petulant exit from a meeting with Republicans on the issue, it is clear that Obama is feeling the pressure. This is compounded by the fact that the historically weak-willed Republicans seem shockingly willing to be proven vertebrates, and actually refuse to back down on principle (Senate Minority Leader Mitch McConnell’s recent suggestion to completely abdicate constitutional duty and give all power to the president notwithstanding).
From class warfare rhetoric about tax breaks for corporate jet owners (signed into law by Obama in the 2009 stimulus bill, and less than a rounding error on the federal budget) to fear mongering the elderly to think Social Security checks will not go out, nothing is beneath this integrity-challenged president in his quest for power. He tirelessly repeats his Marxist mantra of needing to get “millionaires and billionaires” to “pay their fair share” and be a part of the “shared sacrifice”, despite the fact that the top 1% of all income earners (a group starting at $380,354/year and including millions of small businesses that file taxes under personal returns…hardly millionaires and billionaires) paid 38% of total tax revenue, while the bottom 50% paid only 2.7%. The top 5% starts at $159,619 and accounts for 58.7% of taxes paid.
The folks at EconStories released their latest video today, depicting a “Round Two” of their earlier Keynes vs. Hayek hip-hop battle, as the two economists battle over the amount of government spending that should occur to bring America out of tough economic times, what defines prosperity, and whether spending should be top-down or bottom-up.
You should see some other familiar faces portrayed, and the security guard at the beginning is played by Duke University economist, Michael Munger.
Understanding the underlying meaning of a politician’s words is an art. It is a skill that must be cultivated, because all too often the words they speak are nothing more than deceptive marketing. You have the high-energy sales pitch…and thirty seconds of fine print read at high speed. Most of the time, the loud claims are completely negated by the fine print.
Nowhere is this deceptive nuance more prevalent than when politicians talk about money. To those of us in the real world, we go out and work hard to earn money to provide for the needs of ourselves and our families. We have gross earnings, and then we have “take-home pay”, which is the gross earnings minus the litany of state and federal taxes, insurance premiums, etc. If we take a pay cut, it means that our gross earnings are reduced from the previous level. This is how normal people speak.
The political world has its own Orwellian lexicon, where nothing means what it sounds like it means. Before we can even address the lexicon though, we have to address the larger underlying problem; namely, the philosophical differences between government and the average citizen. Since I believe the words of the Declaration and the Constitution, which says that I am a son of my Creator, endowed with unalienable rights, and that government derives its powers from the consent of the governed, I naturally believe that the fruits of my labor belong to me and me alone. As a citizen, I have agreed to take a portion of my earnings and contribute it to the funding of the cost of government, which is there, in theory, to protect my rights.
So often today, those that protest statist or liberal policies are derided as being ignorant or as having nefarious motivations. The working class is often portrayed as being too stupid to know what is best for them; therefore, an elite, benevolent intelligentsia is needed to pat us on the head before brushing aside our concerns and running the country for us. Years ago, Bill Clinton dismissed a reporter’s question as to whether the budget surplus realized from having a balanced budget (thanks to the Republican takeover of the House) would be returned to the taxpayers by explaining that the taxpayers could not be trusted to spend the money “the right way”. The recent passage of the health care bill was done against the will of the majority of voters, but our concerns were dismissed as we were told that once it was passed, only then would we be able to learn what was in it, and just how good it would be. Well, it has passed, and we are finally learning what is in it, and it’s not good at all.
It is trendy in circles of intellectuals today to dismiss the wisdom of the Founding Fathers, to say that what they designed is not relevant two centuries later, or that we need a “living” Constitution, which sways with the political winds and means what we want it to mean at that specific point in time. This shows an extreme lack of historical perspective at just how unique and brilliant our founding documents are.
The U.S. Constitution was passed in 1787. It contains a mere 4,400 words and yet has successfully governed a nation which began with a few million citizens to today, when we number over 300 million. So brilliant was its construction that it has only been amended 27 times, one of which (prohibition) was repealed.
In my political science class we were discussing the issue of taxation. In order to better understand the issue and to balance out a lot of the negativity we inherently have towards taxation (which isn’t a bad thing) we discussed what we (personally and as a society) actually get in return for our taxes.
I decided to make a “cynical” version of the list we thought up in class. So here are ten things we get from taxes:
1 ) Drug Prohibition - Billions spent each year on making sure no one uses drugs that are “too dangerous” for us. Thank you nanny state! Except for the fatal flaw in this argument: marijuana is illegal yet more harmful substances such as alcohol and tobacco are legal. Not to mention the war on drugs is a complete and utter failure.
2 ) Overpaid Government Officials - It’s a well-known fact that city planners, parks and recreation directors, and many others in government are paid “comfortable” salaries sometimes even more than $100,000. Not only that, but many government officials have guaranteed pensions backed by the state. While people work long hours in the private (productive) sector who have to deal with 401K’s and actually saving and investing for retirement, these government officials have it made!
3 ) The Federal Reserve - Ah yes, the Federal Reserve who claims their existence is necessary to “maintain a strong currency,” have been doing just the opposite. As the dollar loses its value slowly but surely and bubbles have rocked our economy into deep recessions many times since its inception, it’s unfortunate this entity receives tax dollars from the private sector.
4 ) Foreign Aid - None of that money goes to waste, right? It all goes directly to the needy in the most efficient manner, no corruption involved! Right…
In 1920, Italian immigrant, Charles Ponzi, developed a scheme which promised high-yield returns on the arbitrage and trade of international postal reply coupons. It sounds like a fancy scheme even today and it fooled many investors at the time. Ponzi, however, was not actually making such investments. He was taking money from new investors, drawn by the promise of high returns, to pay off past investors. A brilliant little scheme except for the fact that it is essentially stealing and fraudulent. This basic framework is now called a Ponzi scheme, and former NASDAQ chairman, Bernard Madoff, has been implicated in what may be the biggest Ponzi scheme of all time.
With the sequester and its effects breathing down our necks over the past week, we’ve heard a lot of horror stories about what would happen if we didn’t somehow magically come up with some way to avoid it, despite the fact that there’s just not enough money to pay for everything. One of the areas President Obama has talked about being hit hard by the cuts was education. After all, teaching kids to read and write is something that Democrats and Republicans, to say nothing of most folks in between, agree should be done.
However, are we really as “doomed” on education as the president has made us out to be?
In September of last year, Andrew J. Coulson wrote over at Cato at Liberty about how increases in spending haven’t exactly correlated to higher test scores like proponents of that additional spending claimed. He presents this graph to illustrate the point:
Coulson goes on to say:
In the past, some readers have wondered if the use of two separate scales ($ on the left and % on the right) might skew the way we perceive these numbers, making the public school productivity collapse look worse than it really is. To allay that concern, I present an alternate version of the chart that places all the data on the same percentage scale. Alas, the second picture is no less bleak than the first.
Indeed, it does. Just look for yourself.
Kind of hard to see much of a difference, is there?
Coulson compared these trends to a different industry, saying:
The “We the People” petitions that can be created on the White House website have become incredibly popular in recent months. Through this site, a user can submit a petition and elicit a response from the White House once it has crossed the 25,000 signature threshold.
The site picked up recognition because of petitions created asking the White House to let states peacefully secede after President Obama won re-election in November. Other petitions that have been created include calls for the White House to legalize marijuana, allow Americans to opt-out of ObamaCare, and to support the NRA’s “National School Shield” prgogram.
There have also been some humorous and rather asburd petitions created. But perhaps the best one was the petition urging the White House to build the Death Star.
During a hearing before the Senate Budget Committee, Treasury Secretary Tim Geithner was asked by Sen. Jeff Sessions (R-AL) whether or not the budget submitted by President Barack Obama — you can see the budget by the numbers here — spent less than or at levels agreed to between the White House and the Congress in August.
As you can see in the video below, Secretary Geithner never really answers the question. What he did give was a long, drawn out “no”: