I was recently reading a book called Rollback (http://search.barnesandnoble.com/Rollback/Thomas-E-Woods-Jr-Thomas-E/e/9781596981416/?itm=4&USRI=rollback), and it estimates that our actual national debt is closer to $125 trillion versus the $14 trillion so many people quote. This is due to interest owed and unfulfilled entitlements like expected welfare, social security and other types of funding.
The author makes the claim that the federal government is on a collision course with time, and that even if we completely stopped spending and reversed course relatively equal to what we're currently spending, even then it will go belly up. The author claims that people will have to become more agricultural and rural with their relations, and local/state governments will once again take the lead and fulfill the role of government similar to the time of the Articles of Confederation.
My question is this, though: do you think the federal government go quietly into the night if it really spent itself into oblivion? Or would it simply tax its citizens 100% and make America grow to become something similar to Cuba?
This is simply an opinion question, curious to see what y'all think might eventually happen.
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Cuba doesn't tax its citizens 100% silly
In States a fresh law is looked upon as a remedy for evil. Instead of themselves altering what is bad, people begin by demanding a law to alter it. ... In short, a law everywhere and for everything!
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Dave and James:
I agree. The Gilded Age was a nightmare.
Laotzu del Zinn:Cuba doesn't tax its citizens 100% silly
There is no such thing as a citizen.
I wasn't implying that they did, but if we were taxes 100%, we would certainly grow the look like Cuba. I was using an extreme case for rhetorical purposes, good call on the inaccurate parallel. Cuba might as well tax their citizens 100% though b/c from all the Cubans I've known that originated from their, they all say it feels that way with what little freedom they have.
Laotzu del Zinn, Cuba, in fact, has relatively low taxes and government spending as a % of GDP. Why?
Cuba's government owns the banks and can decide how all capital is allocated. They don't need tax money as much and they don't need to spend anything themselves.
Venezuela also probably has low government expenditure because it controls the price of everything.
Isn't etatism grand?
Seriously, though, there isn't much historical precedent for big imperial governments just quietly fading away.
Brutus:My question is this, though: do you think the federal government [would] go quietly into the night if it really spent itself into oblivion? Or would it simply tax its citizens 100% and make America grow to become something similar to Cuba?
I don't think it would have to literally tax residents (non-citizens are also taxed, I believe) 100%. As I mentioned in another thread, I think a rather natural progression of events would go as follows:
First, the government will attempt to inflate more and more so it can continue to afford its interest payments on its debt. This will lead to significant price inflation, or "mass inflation". At the same time, it will encourage more private capital to move offshore. The government will likely react (and has reacted) to this by tightening so-called "capital controls" - restrictions on the types and amounts of capital that are allowed to leave the country.
Second, in order for people to continue to afford goods with ever-increasing prices, businesses will have to pay people increasingly higher wages and salaries. Ultimately this will reach a point where it threatens the financial solvency of the businesses. The government will likely react to this by enacting economy-wide wage and price controls. Doing so will actually help the government, in a way - it will enable more of the newly created money to stay in the hands of the government.
Third, such wage and price controls will unfortunately end up causing shortages of just about everything. The government will likely react to this by enacting economy-wide rationing. In the waning days of the Roman Empire, not only were consumption goods rationed, but also production goods and even professions.
Fourth, at some point the people may go into monetary rebellion. This is typically known as "hyperinflation". It occurs when people no longer consider the monetary unit of a fiat-money economy to be worth anything whatsoever. Were this to happen, it would render useless all of the wage and price controls as well as all of the rationing. The government will likely react to this by instituting martial law under the pretense of "restoring civil order".
Ultimately, however, even martial law cannot prevent the day of reckoning. Even if a civil war doesn't flare up, the government will eventually face the looming prospect of default on its outstanding debt. When that happens, it will literally be all out of gas.
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Nicely detailed response. I think you're well on track of what would likely happen.
Seems to me that Michael Savage detected the same trend in his Trickle Up Poverty. Although he can be a bit too much of a nationalist for me, he makes some good cases in that book. In my opinion, martial law will be the manifestation of the dualistic society, which would likely result in the same type of oppression that the USSR witnessed.
All this, of course, is in a worst case scenario.
No, there won't be martial law. There won't be a massive societal collapse. The crisis is being milked while alternative plans are drafted behind the scenes. All the power centers are jockeying to be the "savior" who will swoop in at the last possible second with the proposal that will "fix everything." The real purpose of this health bill was to set the groundwork to solve the Medicare/Medicaid problem by simply nationalizing healthcare. At the appropriate time, the President will sign an executive order and Medicare/Medicaid will cease to exist in their own right and there will simply be a "Medicare Dept." at the National Health Bureau that runs the entire healthcare system (except for private doctors for the ultra-wealthy, of course). Then, costs can be "controlled" as doctors and hospitals do what they're told rather than selling their services in a controlled market where already extortionate prices are soaring as supply is being artificially constricted. $60 trillion in "unfunded obligations" will simply evaporate off the liability column of the US government balance sheet overnight. See the magic of government? That's why everything should be done this way! They'll have some grandiose name for it like "Healthcare Bill of Rights" or "The New American Health Initiative" or "The Healthy Society" or something.
The same is going to happen to Social Security. Fixing it will be put off until it's a "crisis" and then a national retirement system will be announced at the last moment and private pensions in 401(k)s and IRAs will be seized to fund the new national retirement system. There's another $40 or $50 trillion in unfunded obligations.
The US will continue buffaloing its vassal states over the $15 trillion in outright debt that it owes. For the time being, it looks like it's working. Time will tell how much longer the charade will work. At some point, somebody's going to call the US bluff and things will get ugly fast but it probably won't last long because the US is becoming a paper tiger. As our economy is gutted by taxation, regulation and outright nationalization, our military might is dwindling. It's the same with every empire.
Clayton -
Pretty matter-of-fact there, Clayton. We'll have to see I guess.
So I take it your stance is that the old Bolshevik ways are either outdated or too obvious and they will slowly tax us to death, gradually expanding government in order to escalate its stronghold over the private sector while not officially stating it, right? You know, if this is the case, I think you're probably right.
Although I believe they would quickly resort to martial law if the citizenry rebels at any point (hence, the Civil War, although that was an organized effort to create an entirely different confederation and it wasn't spur-of-the-moment), you bring up a good point about their methods being quieter than that. They certainly are, and unfortunately for people like us (free thinking, that is), the general population seem to buy into governmental methods and mentalities; hence, the ACLU, SEIU, democratic party, even the republican party at this point, et cetera.
The quiet offense seems more effective since it builds as a snowball due to its clandestined nature. Now, more importantly, what realistic means can we seek to reverse this sickening statism that continues to further consume our liberty?
Brutus:Now, more importantly, what realistic means can we seek to reverse this sickening statism that continues to further consume our liberty?
You want the truth?
Pretty matter-of-fact there, Clayton. We'll have to see I guess. So I take it your stance is that the old Bolshevik ways are either outdated or too obvious and they will slowly tax us to death, gradually expanding government in order to escalate its stronghold over the private sector while not officially stating it, right? You know, if this is the case, I think you're probably right.
The Bolsheviks had no corner on the market of tyranny and oppression. It's the oldest game in town and still the most profitable. The State has always rested on deception.
Although I believe they would quickly resort to martial law if the citizenry rebels at any point (hence, the Civil War, although that was an organized effort to create an entirely different confederation and it wasn't spur-of-the-moment), you bring up a good point about their methods being quieter than that. They certainly are, and unfortunately for people like us (free thinking, that is), the general population seem to buy into governmental methods and mentalities; hence, the ACLU, SEIU, democratic party, even the republican party at this point, et cetera. The quiet offense seems more effective since it builds as a snowball due to its clandestined nature.
The quiet offense seems more effective since it builds as a snowball due to its clandestined nature.
The point is that the government never wants to face down a rebellion because it can never win. The government is necessarily a minority of the population by virtue of its parasitic nature. Its existence is funded solely by the productivity and compliance of its subjects. If the subjects refuse to produce, the government has no wherewithal to feed its police, administrators and soldiers. Worse, if they become hostile, the government is faced with insurmountable odds. If 10% of the population are hardcore allies of the governing authority (a pretty generous figure), then they are going to be facing odds as bad as 10:1 in the event of a total rebellion and since the government cannot be everywhere at once, this usually ends up in one of two extremes... mobs attacking well-defended positions and getting slaughtered by the hundreds, on the one hand, and government defenders being overwhelmed 100:1 by angry mobs on the other hand. Look at all the recent riots, it's the same thing every time.
By the time people begin rebelling, the government has already lost its grip on power and at the very least you're looking at a regime change as other factions vying for power see a chink in the armor of the current establishment and prepare to rush in to "fill the leadership void." The kind of protracted standoff depicted in the movie The Siege, for example, exists only in the fantasies of paranoid CIA and Pentagon brass.
Now, more importantly, what realistic means can we seek to reverse this sickening statism that continues to further consume our liberty?
Probably the best things you can do are: leave the US, start your own family business and have lots of children and teach them to take over your business after you die.
"leave the US" To where? The USA is still the most prosperous and free place on earth.
US is a fantastic place, not even close to being the prosperous and free though.
Could you please point me to somewhere more prosperous and free?
We had to run from England to escape persecution, and when we got here, the British wanted to overrun us. King George III said he ought "never to acknowledge the independence of the Americans, and to punish their contumacy by the indefinite prolongation of a war which promised to be eternal," and we showed him what the inspiration of liberty and freedom can do to a more powerful force trying to subdue it. Anyone who tries to ignore the fact that the ability of early Americans to run a war and bond together in a confederation of friendship in order to successfully destroy a tyrannical enemy as big as the British was awe-inspiring is short sighted and needs to read more about the American War of Independence.
I'm never leaving America. I love America for what it was founded upon, but certainly not for the way it is being run now. Ever since the abolishment of the Articles of Confederation, the consequential adoption of the U.S. Constitution and the loss to the tyrants of the Civil War, America has systematically gone downhill, and the growth of government is as amazing as it is sickening; amazing in that the people have let the seeds of tyranny sprout so soundly. Bottom line, though, is I'm never running.
In the words of the great Patrick Henry, "Let your suspicion look to both sides. There are many on the other side, who possibly may have been persuaded to the necessity of these measures, which I conceive to be dangerous to your liberty. Guard with jealous attention the public liberty. Suspect every one who approaches that jewel. Unfortunately, nothing will preserve it but downright force. Whenever you give up that force, you are inevitably ruined." People often mistake today's America for the true America that it once was, though the two cannot be more different. However, that doesn't mean we run.
It's most likely that the U.S. breaks up as a nation after a series of heavy-handed and mostly ineffective measures to "fix" the problem.
At around the same time, some states will also become insolvent; either before or after the Federal government becomes insolvent. It's possible that some of these states completely breakdown and local communities pick up the slack, if they can. These could be the pockets in the U.S. that will resemble third world countries - for a while. Some areas may actually end up being better off.
Hopefully by this time people finally get it. Government is the source of the problem, and therefore the solution is something other than government. This is where anarcho-capitalism has a shread of hope, but I remain skeptical in the complacency of most Americans. Perhaps hard times is the best cure for that.
Without a Federal or State government, one of the immediate benifits will be the removal of completely useless and restrictive laws and regulations. This is why I suggest some communities might even experience a boom.
The most probable situation, if the U.S. government fails, is just a replacement with more of the same. Another completely useless government that survives for a period of time before it ends up doing the same thing all over again.
If I were a betting man though, I'd say the U.S. is headed towards a socialist, totalitarian state. Kind of where it is today come to think about it.
@Brutus:
To quote the great Kenny Rogers:
The whole lemmings thing is a myth
So any ideas on where to run? I was planning on running to the USA, not away from it.
Aristippus: "leave the US" To where? The USA is still the most prosperous and free place on earth. So any ideas on where to run? I was planning on running to the USA, not away from it.
http://www.heritage.org/index/Ranking
I've lived in #3 all my life - it is nowhere near as prosperous or free as the USA (yes I have been there), and rapidly becoming worse than it is now. In comparison the USA still looks like the land of opportunity to me. 1 and 2 are also becoming less free.
The U.S. is becoming less free. Yes, the list is certainly not perfect (I mean, how accurate can you really be when trying to rank entire countries on a "freedom" scale?) Our own Stefan Karlsson has challenged the usefulness of the index due to the fuzziness of many of the categories used to determine freedom.[17] But then again, that was over 6 years ago. I'm sure the measures have improved since then.
But either way, it's a decent place to start to answer your question. Did you click on the individual countries to see the details on how they came to those conclusions? What specific insights could you provide, and/or what specifically do you disagree with?
Just a few notes on Australia:
Greater restrictions on trade and tiny local population means cost of goods much greater than in the USA (which has access to the division of labour of >500 million people locally)
The first point is exacerbated by restrictions on immigration (there are a lot of migrants compared to other countries, but a lot less than the USA).
Huge amounts of land owned by government which no one is allowed to use. This (as well as other government policies) means that the median house price is a few times that of the USA. I realise that there is a lot of land in the USA which is unsettled due to government control, but at least the US had a much greater period of settlement. This is the main reason that I want to leave - but who knows, the bubble may burst soon enough!
You can't really own guns; in general there are a lot more laws to protect you from yourself.
Government funded propaganda network.
Interesting. I'd like to hear other takes from more locals. At least your currency isn't being debased like it's last month's welfare check. In fact your dollar is reaching record highs all the time. Didn't you just hit a 32 year high this past week?
And just FYI, there are barely 500 million people on the continent of North America, let alone in the U.S.
Wikipedia says a bit over 528 million in North America.
The AUD is being devalued, just not as much as certain other currencies.
...As I said, barely 500 million in North America. If you want to consider countries like Cuba and Panama "local" to the U.S. in terms of their population helping our economy, we might as well count the 600 million you've got nearby in Southeast Asia. And we can go ahead and throw in Melanesia and Micronesia since they're even closer. And that's not counting the 20 million you've actually got in your border ;-)
But it sounds like you don't like any answers given to you. You ask "where else is free?" I show you a list and your response is "those places are getting less free." I tell you how your dollar just hit a record high yesterday and the U.S. dollar is hitting record lows, and you say your dollar is being devalued too.
I'm not really sure what you're looking for.
No, Southeast Asia cannot be counted due to restrictive trade barriers. It makes a lot of difference. I wasn't arguing with you, just pointing some things out.
To where? The USA is still the most prosperous and free place on earth. So any ideas on where to run? I was planning on running to the USA, not away from it
So any ideas on where to run? I was planning on running to the USA, not away from it
I am not sure how http://www.heritage.org/index/Ranking is calculated. But I have lived in south africa for a number of years and the uk and I can say that south africa is far more free than the UK (not only in a purely economic sense). I find that the, what they call third world countries, are more free than the first world countries. They have less regulations and less of a police force and the countries with more empty space also appear to be more free as you can get away from the law far easier. You would have less of a chance of an enforcement officer of any kind arriving at your door in a rural remote region of south africa then you would of denmark or norway or germany or the uk, due to the size of the country and size of the government. This ranking must be regarding more the trading of stocks and similar, than starting and running a business.
I heard that the only country without a central bank is panama. I have been thinking of moving to the USA and then eventually Costa Rica or even back to South Africa, depending on certain factors.
Aristippus:"leave the US" To where? The USA is still the most prosperous and free place on earth.
That really depends upon how you define free and prosperity.