What do you predict is going to happen economically in the next year or two?

[DawnM]

Just curious.

 

http://wallstreetpit.com/77953-the-second-recession-what-it-will-feel-like

 

I keep hearing about our debt and raising the debt ceiling and how if we don't it could cause a 2nd recession.

 

Dawn

[amy g.]

I really think there will be increased inflation. Dh isn't convinced, but I am buying things I know I'll need (cattle panels, feed) rather than just letting my money sit in the bank.

[lea1]

I really think there will be increased inflation. Dh isn't convinced, but I am buying things I know I'll need (cattle panels, feed) rather than just letting my money sit in the bank.

 

:iagree: I have been trying to buy ahead for clothes for my two sons and to also buy ahead for any food and sundry items that keep for an extended amount of time. If I was more organized, I would also buy ahead for homeschooling.:tongue_smilie: Must work on that.

[QueenCat]

Just curious.

 

http://wallstreetpit.com/77953-the-second-recession-what-it-will-feel-like

 

I keep hearing about our debt and raising the debt ceiling and how if we don't it could cause a 2nd recession.

 

Dawn

 

If we don't raise the debt ceiling, we will have major issues with our creditors (the U.S. govt's creditors, not our personal ones). Issues that will make the current economic condition look nice, compared to how it will be if we don't raise it. Raising it is ESSENTIAL, and not for adding new debt, but to deal with the interest.

[Aelwydd]

Just curious.

 

http://wallstreetpit.com/77953-the-second-recession-what-it-will-feel-like

 

I keep hearing about our debt and raising the debt ceiling and how if we don't it could cause a 2nd recession.

 

Dawn

 

This article reiterates what many economists have been warning about. This presentation, by Dr. Richard Wolff, an economist and professor, offers about the most comprehensive analysis of the reasons for how and why we got here, and what is in store for us. I highly recommend it.

[WishboneDawn]

Just curious.

 

http://wallstreetpit.com/77953-the-second-recession-what-it-will-feel-like

 

I keep hearing about our debt and raising the debt ceiling and how if we don't it could cause a 2nd recession.

 

Dawn

 

And not just in the USA. Reports from the USA seem to be very worried about the USA but the effect of not raising the debt ceiling will be felt world wide. The US is the biggest creditor AND debtor in the world.

[DawnM]

Yes! Sorry, didn't mean to sound ethnocentric......but the concern I had was with how the US will fare because it relates to the rest of the world.

 

And not just in the USA. Reports from the USA seem to be very worried about the USA but the effect of not raising the debt ceiling will be felt world wide. The US is the biggest creditor AND debtor in the world.

[DawnM]

Thanks. I am listening....he is confirming thoughts I have had for a long while.....that our economy has been built on a house of cards (debt) particularly starting in the 80's.

 

Hopefully he will soon address where he thinks we will be in the future and some solutions.

 

Dawn

 

This article reiterates what many economists have been warning about. This presentation, by Dr. Richard Wolff, an economist and professor, offers about the most comprehensive analysis of the reasons for how and why we got here, and what is in store for us. I highly recommend it.

[JudyJudyJudy]

I came into this thread expecting that I would have to be the dissenter, but I agree with the rest of you.

[ma23peas]

Someone asked this question 2 years ago, when some were hoping things would look up with a new leadership...we were neck deep into 2 mortgages that took over 31 months to sell off one...I predicted then that this would take 7-8 years to correct (that is IF we have leaders who will do the corrections)...we are two years into it, so I see no lifting of the economy for another 5 years.

 

You can not raise the debt ceiling unless you are responsible and cut spending...I think it is outrageous for me to have a credit card, have a balance of $50,000 on it...I can barely make the interest only payments but I want to raise the limit on it...ultimately it will crash and there will be no bailouts, not enough taxes to handle the burden and families will be wiped out. I say do away with the IRS completely, our technology is so great now that we should have 1/10th the number of employees in that system...go to a fair tax system...no deductions/no exemptions...you pay or else...but stop spending money we do not have.

[WishboneDawn]

 

You can not raise the debt ceiling unless you are responsible and cut spending...I think it is outrageous for me to have a credit card, have a balance of $50,000 on it...I can barely make the interest only payments but I want to raise the limit on it..

 

I think it would also be outrageous if you choose not to roll up your sleeves, get out, and raise your income along with cutting spending. This whole cut-taxes-or-raise-spending argument is ridiculous to me. The hole the USA is in took decades and decades to dig and isn't something that can be addressed by just one or the other measure. It's like saying that massive credit card debt can be addressed by either cutting the gym membership and cable bill or by going out and finding a part time job. Sometimes it's so bad you just have to buckle down and do both.

[leeannpal]

I think it would also be outrageous if you choose not to roll up your sleeves, get out, and raise your income along with cutting spending. This whole cut-taxes-or-raise-spending argument is ridiculous to me. The hole the USA is in took decades and decades to dig and isn't something that can be addressed by just one or the other measure. It's like saying that massive credit card debt can be addressed by either cutting the gym membership and cable bill or by going out and finding a part time job. Sometimes it's so bad you just have to buckle down and do both.

 

:iagree: Unfortunately, we have many politicians who live in glass houses and have no idea what the "rest of us" are having to do because of the economy.

[WVNA]

Just curious.

 

http://wallstreetpit.com/77953-the-second-recession-what-it-will-feel-like

 

I keep hearing about our debt and raising the debt ceiling and how if we don't it could cause a 2nd recession.

 

Dawn

 

I'd highly recommend watching this series of videos - http://www.chrismartenson.com/crashcourse. He has the best summary of how we got into this mess and the future threats we face that I've ever seen.

[Britomart]

If we don't raise the debt ceiling, we will have major issues with our creditors (the U.S. govt's creditors, not our personal ones). Issues that will make the current economic condition look nice, compared to how it will be if we don't raise it. Raising it is ESSENTIAL, and not for adding new debt, but to deal with the interest.

 

But where does it stop?

 

I'm not trying to be flip. I see what you're saying: we owe and have to pay. But I assume we can't just keep paying more and more interest and raising the debt ceiling indefinitely . . . is there an end game?

 

Well, I mean, one where we aren't Greece?

[Photo Ninja]

I think it would also be outrageous if you choose not to roll up your sleeves, get out, and raise your income along with cutting spending. This whole cut-taxes-or-raise-spending argument is ridiculous to me. The hole the USA is in took decades and decades to dig and isn't something that can be addressed by just one or the other measure. It's like saying that massive credit card debt can be addressed by either cutting the gym membership and cable bill or by going out and finding a part time job. Sometimes it's so bad you just have to buckle down and do both.

 

One problem with this is that we can't trust that the politicians will actually keep the cuts and not increase spending later to match the increased income from increased taxes.

 

If you cut the gym membership and cable bill and increase your monthly income, then there will be a net decrease in your debt. But there will be no decrease if, a few months after you increase your income, you get a new gym membership, reinstate cable, then realize you have more money monthly than you had before, so you get a new car as well. The original problem then continues.

 

Perhaps an increase in taxes would work if politicians would tie the continued tax increase to maintaining cuts and guarantee no increased spending in the future, but I don't think that is realistic, given the spending history that got our nation into this problem in the first place.

[Kathleen in VA]

This article reiterates what many economists have been warning about. This presentation, by Dr. Richard Wolff, an economist and professor, offers about the most comprehensive analysis of the reasons for how and why we got here, and what is in store for us. I highly recommend it.

 

Well, it took me a while due to many interruptions, but I just finished watching that and it was fascinating. Thanks for sharing.

[LibraryLover]

I love me some Marixst Prof Wolf. :001_smile:

[jld]

Here's something interesting from economist Paul Krugman's blog yesterday:

 

OK, here’s an unprofessional speculation: maybe it’s personal. Maybe the president just doesn’t like the kind of people who tell him counterintuitive things, who say that the government is not like a family, that it’s not right for the government to tighten its belt when Americans are tightening theirs, that unemployment is not caused by lack of the right skills. Certainly just about all the people who might have tried to make that argument have left the administration or are leaving soon.

And what’s left, I’m afraid, are the Very Serious People. It looks as if those are the people the president feels comfortable with. And that, of course, is a tragedy.

 

Update: To commenters saying that I need to have dinner with the president, or vice versa — been there, done that, didn’t help.

 

If you don't regularly read Krugman's blog, you may want to check it out. He explains economic issues simply and clearly.

 

http://krugman.blogs.nytimes.com/

[ma23peas]

I think it would also be outrageous if you choose not to roll up your sleeves, get out, and raise your income along with cutting spending. This whole cut-taxes-or-raise-spending argument is ridiculous to me. The hole the USA is in took decades and decades to dig and isn't something that can be addressed by just one or the other measure. It's like saying that massive credit card debt can be addressed by either cutting the gym membership and cable bill or by going out and finding a part time job. Sometimes it's so bad you just have to buckle down and do both.

 

I would not mind doing both if I had a Congress/leader who proved to me they could provide a budget and stick to it, one who has shown strong efforts at reducing spending...but when you have leadership that has a carte blanche mentality with spending/programs with no fiscal responsibility....it's like giving a drug addict more money...they have never proven they can abstain...and the more money you give, the more they will spend...just not wise economics.

[Kathleen in VA]

I love me some Marixst Prof Wolf. :001_smile:

 

He seemed to hit the nail on the head very often, even if he is a Marxist. I think his basic fault lies in his inability to see the problem as greed and not capitalism. Marxists can be greedy too, unfortunately. Our economic woes are downstream from our spiritual bankruptcy. Unless individuals, whether capitalists, Marxists, what have you, lose the greed (not likely) there will always be economic crises.

 

I found it interesting that he predicts socialist Great Britain as the next country to go down the drain.

[Stacy in NJ]

He makes no distinction between capitalism and crony capitalism.

 

He seemed to hit the nail on the head very often, even if he is a Marxist. I think his basic fault lies in his inability to see the problem as greed and not capitalism. Marxists can be greedy too, unfortunately. Our economic woes are downstream from our spiritual bankruptcy. Unless individuals, whether capitalists, Marxists, what have you, lose the greed (not likely) there will always be economic crises.

 

I found it interesting that he predicts socialist Great Britain as the next country to go down the drain.

[Aelwydd]

He makes no distinction between capitalism and crony capitalism.

 

Because he sees one as the natural outflow of the other. Economic systems are human constructs; as such, they reflect the natural flaws found in human nature. Capitalism's defect is that it is fueled by human greed. Not mere need, but greed. That's what a profit is--what you take away above and beyond what is necessary to function.

 

Socialism's defect is that it is too vulnerable to inertia. Human complacency does not drive innovative ideas.

 

That's why any solution must involve the correct titration of both systems. You need the personal motivation of profit, to drive new ideas, to an extent. But you also need an emphasis on community needs, and a way to protect the larger group from the uninhibited appetites of the few. Human nature has never shown a tendency to regulate or discipline itself--it requires an outside force to exert that discipline.

 

The U.K. practices a level of socialization, but it is still a very heavily capitalistic society. Think of its banking industry. Think of its former empire, and how it was based upon pulling in resources globally to support its burgeoning economy. The post-WWII increase in social services was a concession to the needs of the people, who'd been pushed to the limit.

 

Anyway--I think Dr. Wolff presents some very good arguments for why we need to seriously reconsider how we do business (literally). I don't think he is arguing for a truly Marxist or socialist society (he's not delusional--that would never, ever fly in the U.S.); there definitely need to be limits placed somewhere, or capitalism will continue to careen wildly between boom and bust, until we hit the ultimate bust.

[Aelwydd]

Well, it took me a while due to many interruptions, but I just finished watching that and it was fascinating. Thanks for sharing.

 

My pleasure. I'm in the middle of watching the Chris Martenson's videos that WVNA linked to. Interesting stuff.

[QueenCat]

But where does it stop?

 

I'm not trying to be flip. I see what you're saying: we owe and have to pay. But I assume we can't just keep paying more and more interest and raising the debt ceiling indefinitely . . . is there an end game?

 

Well, I mean, one where we aren't Greece?

 

The problem being, not being flip either, in any of my response, is that if we don't pay, the creditors can call in the loans and/or raise interest. Along with other, complicated consequences. I'm totally with you though, we need a plan for getting out of the situation. It's not simplistic, and most of the politician's (on both sides) try to present simplistic views. It can't be one way or the other. There has to be real compromise on both sides to get it done, for a long time. At this hour, I know that's probably not as coherent as I want it to be but it'll have to suffice :).

[GWOB]

I think it would also be outrageous if you choose not to roll up your sleeves, get out, and raise your income along with cutting spending. This whole cut-taxes-or-raise-spending argument is ridiculous to me. The hole the USA is in took decades and decades to dig and isn't something that can be addressed by just one or the other measure. It's like saying that massive credit card debt can be addressed by either cutting the gym membership and cable bill or by going out and finding a part time job. Sometimes it's so bad you just have to buckle down and do both.

 

:iagree: Thank you so much for saying this, especially as an "outsider" (by that I mean not someone who is smacked upside the face by American political excrement). There really is a gray (or is it "grey" for you Canadians?) area. We should aim for gray.

[jld]

Anyway--I think Dr. Wolff presents some very good arguments for why we need to seriously reconsider how we do business (literally). I don't think he is arguing for a truly Marxist or socialist society (he's not delusional--that would never, ever fly in the U.S.); there definitely need to be limits placed somewhere, or capitalism will continue to careen wildly between boom and bust, until we hit the ultimate bust.

 

Paul Krugman says we need a return to tight regulation. Have you read his Return to Depression Economics? He explains how, before the Depression, there were boom and bust periods in America regularly. There would be panics and people would remove all their money from banks. It was really unstable and people of course did not trust the system.

 

Then, during the Depression, tight regulation of banking was instituted, and for 60 years U.S. banking was fairly stable. Then, in the 90s, with the support of Republicans and Democrats, deregulation began. People were told they could trust the free market. More and more deregulation, and all that belief in how the markets could regulate themselves, and look where we are now. Can you imagine living without some sort of law enforcement in your community? Well, that's what happened in the world of finance, and we saw the result: greed ran rampant and unchecked.

 

A great read on how deregulation brought about the financial crisis we are still in is Freefall, by Nobel prize-winning economist Joseph Stiglitz.

[DawnM]

Interesting. I would like to read more on the subject.

 

I find that so many of my IRL friends are so anti-"big" government and by that they want the government out of just about everything. So these discussions typically don't get into the actual solutions I think need to happen.

 

Dawn

 

 

Paul Krugman says we need a return to tight regulation. Have you read his Return to Depression Economics? He explains how, before the Depression, there were boom and bust periods in America regularly. There would be panics and people would remove all their money from banks. It was really unstable and people of course did not trust the system.

 

Then, during the Depression, tight regulation of banking was instituted, and for 60 years U.S. banking was fairly stable. Then, in the 90s, with the support of Republicans and Democrats, deregulation began. People were told they could trust the free market. More and more deregulation, and all that belief in how the markets could regulate themselves, and look where we are now. Can you imagine living without some sort of law enforcement in your community? Well, that's what happened in the world of finance, and we saw the result: greed ran rampant and unchecked.

 

A great read on how deregulation brought about the financial crisis we are still in is Freefall, by Nobel prize-winning economist Joseph Stiglitz.

[WishboneDawn]

Interesting. I would like to read more on the subject.

 

I find that so many of my IRL friends are so anti-"big" government and by that they want the government out of just about everything. So these discussions typically don't get into the actual solutions I think need to happen.

 

Dawn

 

Agreed. And I find that at the root of the anti-gov't folks there's a break with the idea that WE are our respective governments. They view gov't as something outside themselves and in opposition to themselves. A dangerous view in a democracy to my mind.

[Trish]

Just curious.

 

http://wallstreetpit.com/77953-the-second-recession-what-it-will-feel-like

 

I keep hearing about our debt and raising the debt ceiling and how if we don't it could cause a 2nd recession.

 

Dawn

 

I would expect a "crash" similar to what happened in 2008 before the end of 2011. Whether they raise the debt ceiling or not, it will more likely result in a depression this time, rather than a second recession. I get a lot of my financial info from Zero Hedge. They are talking about the debt ceiling this morning.

[Onceuponatime]

I believe:

 

Whatever is coming, it won't be good for somebody.

 

There is a massive amount of fraud in our American financial system, the American government, and in the global financial world. The natural consequences for this can not be put off forever. The question is how long can we keep going like this? Why aren't more people going to jail? If you and I did some of the things the large banks have been doing we would have been in jail years ago. Our government has supported them in their fraud.

 

I don't believe in too big to fail. I believe America thinks it is too big to fail. We'll see.

 

I think the people in Iceland have the principled guts that we used to have.

 

Barring a miracle, eventually Greece will default, other countries will follow, the Euro will disintegrate. The whole world will be an economic mess. How quickly each country comes out of the mess depends on what the people of those countries allow their governments to do. Common People have extraordinary potential to turn things around.

 

I don't think it matters if we raise the debt ceiling, we can't stop what's coming. Maybe if we choose not to raise it we can bring things to a head and get the worst over faster.

[FaithManor]

I believe:

 

Whatever is coming, it won't be good for somebody.

 

There is a massive amount of fraud in our American financial system, the American government, and in the global financial world. The natural consequences for this can not be put off forever. The question is how long can we keep going like this? Why aren't more people going to jail? If you and I did some of the things the large banks have been doing we would have been in jail years ago. Our government has supported them in their fraud.

 

I don't believe in too big to fail. I believe America thinks it is too big to fail. We'll see.

 

I think the people in Iceland have the principled guts that we used to have.

 

Barring a miracle, eventually Greece will default, other countries will follow, the Euro will disintegrate. The whole world will be an economic mess. How quickly each country comes out of the mess depends on what the people of those countries allow their governments to do. Common People have extraordinary potential to turn things around.

 

I don't think it matters if we raise the debt ceiling, we can't stop what's coming. Maybe if we choose not to raise it we can bring things to a head and get the worst over faster.

 

This is what I think. We've lived on the rob Peter to pay Paul plan and, "I can have what I want today even if I have no idea how to pay for it tomorrow" plan as a country, as a government, for far tooooo long.

 

Faith

[prairiewindmomma]

Iceland's principled guts = they defaulted. They took over the domestic units of the banks and allowed foreign creditors to bear the losses. Iceland has already warned Ireland & Greece that they shouldn't follow Iceland's model:

http://www.bloomberg.com/news/2011-06-15/greece-ireland-can-t-default-like-iceland.html

 

I agree with the others---we have more than a bit of stormy weather ahead of us. There are some easy regulatory things we could do in banking that would greatly improve the situation. I agree with a lot of the posters on zero hedge in that regard. I think that we do have too large of a % of US jobs tied to the government--but I think the solution is to encourage more private sector jobs. I think we need to address the disparity between rich and poor and simplify and straighten out or tax code.

 

I just don't think that our government is going to do those things (whichever party they belong to). I don't think deflation is going to happen right now....I don't know if stagflation is where we're headed or if we're going to double dip.

 

I anticipate higher food costs, higher medical costs, higher or stable energy costs, greater unemployment, salaries not keeping up with the COLA, and just a general continuation of all of the yuckiness we've been dealing with.

[JessieC]

My view is that the economy is based on a system that requires it to keep growing, while we live on a planet that stays the same size. As human population keeps growing and a "healthy" capitalist system requires us to consume more and more, we are headed for inevitable collapse, as the Earth just can't keep up. I'm very worried about food shortages caused by overpopulation and global warming in the not-too-distant future, and can't separate the economy from our unreasonable demands on the planet.

[FaithManor]

My view is that the economy is based on a system that requires it to keep growing, while we live on a planet that stays the same size. As human population keeps growing and a "healthy" capitalist system requires us to consume more and more, we are headed for inevitable collapse, as the Earth just can't keep up. I'm very worried about food shortages caused by overpopulation and global warming in the not-too-distant future, and can't separate the economy from our unreasonable demands on the planet.

 

Jessy C, did you read this month's National Geographic Article on the "Seed Ark" and the frightening future of our food supply due to Big Ag? I read it out loud to our whole family and ds (12 years old) is going to do a "food conservation" project for 4-H next year based on the concept of open-pollinated heirloom vegetable and fruit seeds.

 

We've lost 90% of the world's food diversity which is leaving us open to massive crop failures and livestock deaths due to disease and pestilence and the rapid endangerment and extinction of indigenous plants and breeds of livestock that are naturall resistent to the negative aspects of their environment. 1600 breeds of livestock out of the estimated original 8000 residing on planet earth 100 years ago, are now extinct or seriously endangered with 1000's more headed that way. Big Ag tends to grow one kind of cow, one kind of pig, one kind of chicken, one kind of wheat, one kind of........ and all of these are VERY vulnerable to decimation from specific diseases and some of those diseases are on the rise and traveling around the planet.

 

I hate to say it, but the world is going to pay for it's short-sideness in the all important pursuit of making profits rise abnormally fast.

 

Anyway, it was an EYE-OPENING article.

 

Faith

[JessieC]

I haven't read it, but those big ag companies like Monsanto seem evil to me, mainly from watching "Food Inc" and seeing what they have done to farmers. I will look up the article--thanks!

[Britomart]

The problem being, not being flip either, in any of my response, is that if we don't pay, the creditors can call in the loans and/or raise interest. Along with other, complicated consequences. I'm totally with you though, we need a plan for getting out of the situation. It's not simplistic, and most of the politician's (on both sides) try to present simplistic views. It can't be one way or the other. There has to be real compromise on both sides to get it done, for a long time. At this hour, I know that's probably not as coherent as I want it to be but it'll have to suffice :).

 

Thank you for the answer. I suppose every time I think of the national budget, I compare it to my household budget, and I know it's more complicated than that. Though I can never help but wonder whether or not it's just more complicated accounting-wise, and not more complicated philosophically.

 

I think the problem must be what you pointed out: the politicians present simplistic views. And of course they do: a good soundbite equals an electable candidate. But I imagine, if a country's budget is like a household budget than what they really need to say is: "You're not going to get everything you want," and no one's going to elect the guy who says that.

 

Plus, both sides, I imagine, have to give up things they want, if we're going to pay back our debts. The problem is that, unlike a household, where you have one or two adults deciding to bite the bullet, you've got millions of adults who all have to decide to be skinflints all at the same time.

[amy g.]

My oldest raises dual purpose (meat and milk) cattle as well as dual purpose and miniature goats. she will now even use artificial insemination because she believes it will narrow the choices we will have in the future for genetics.

 

It is interesting that the trend has been to move towards seeds that don't reproduce true when they are saved, poultry that has breasts so abnormally large that they can't reproduce naturally, and hens that are bred to not sit eggs and raise chicks.

 

It seems pretty clear that all of these practices endanger our future food supply, and limit our ability to produce our own fresh food for our families.

[renabeth]

My oldest raises dual purpose (meat and milk) cattle as well as dual purpose and miniature goats. she will now even use artificial insemination because she believes it will narrow the choices we will have in the future for genetics.

 

It is interesting that the trend has been to move towards seeds that don't reproduce true when they are saved, poultry that has breasts so abnormally large that they can't reproduce naturally, and hens that are bred to not sit eggs and raise chicks.

 

It seems pretty clear that all of these practices endanger our future food supply, and limit our ability to produce our own fresh food for our families.

 

A little off topic, but I agree about the chickens. I have always raised "Red Star" chicks. They never set on their eggs. I was bragging to my dad that if everything collapsed at least we could have eggs and he said "No we won't, those things can't even reproduce." He was right. I just ordered 25 chicks from breeds that can reproduce themselves. :)

[FaithManor]

Amy G. I watched a short video about Butterball Turkeys. Hmmm...it is literally impossible for them to reproduce because of those massive breast sizes. The appalling thing, the JOB I CAN'T IMAGINE ANYONE WOULD WANT, was the "harvesting" of Ahem...."seed" for artificially inseminating the hens. Oh my word, oh my word, oh my word,.....proof positive that the world has thrown all sense out the window!

 

I think it's important that the world get a wake-up call about the pseudo-foods being consumed.

 

Some of the heritage breed turkeys, by the way, are really, really tasty even if they don't produce as much "white meat" as a butterball.

 

Ds wants to raise a couple of heritage breed chickens next year. But, sadly, he'll have to get chicks rom a reputable source and he won't be able to raise chicks. We can't have a rooster here in town....but, that's a small price to pay for being able to have some hens inside the town's boundaries.

 

Faith

[Margaret in GA]

But where does it stop?

 

I'm not trying to be flip. I see what you're saying: we owe and have to pay. But I assume we can't just keep paying more and more interest and raising the debt ceiling indefinitely . . . is there an end game?

 

Well, I mean, one where we aren't Greece?

 

The difference here is that Greece has never actually had a stable economy. And cannot come up with extra revenue to get out of their debt crisis. This is a superb article by Fareed Zakaria which discusses why you cannot really compare Greece to the USA:

 

"The United States, by contrast, does not have a solvency problem. The American economy remains one of the world's most competitive, with many of the fastest-growing companies in most of the advanced industries. It houses the best capital markets in the world, the greatest universities and the most dynamic society.

America is demographically vibrant, thanks to immigration. It will be the only rich country that will see its population grow over the next 25 years."

 

 

"Would Congress simply allow the Bush tax cuts to expire - returning rates to where they were under Bill Clinton's presidency when America created almost 25 million jobs - that one action would provide the federal government with $3.9 trillion in revenues over the next decade and basically solve the deficit problem. We would still face the long-term problem of entitlements, especially health care costs, like every other rich country, but the short and medium-term crisis would be over."

 

I am all for cutting spending, don't get me wrong. But, we must do both- cut spending and increase revenue. Otherwise, you are just kicking the can down the road.

 

As to the OP's post, I think things are not getting worse, but not really getting better either. At least for another 1-2 years. Maybe more. I am interested in that group of videos the other poster recommended (Crash Course). I do think we about to enter a new era with extreme environmental issues. And I am very afraid. Because every time we have a massive floods like this year's and wildfires like this year's, and drought... I can't even imagine how we will be able to pay for all the infrastructure we will be replacing in the coming years. If a dust bowl was a major reason we couldn't get out of the Great Depression, what will all this do?

 

Margaret, about to plan for the future by canning those tomatoes...

[Margaret in GA]

I haven't read it, but those big ag companies like Monsanto seem evil to me, mainly from watching "Food Inc" and seeing what they have done to farmers. I will look up the article--thanks!

 

 

:iagree: Have y'all read about Roundup Ready Crops being vulnerable to a new pathogen that causes the crops to wilt and causes spontaneous abortions in livestock? We've allowed ourselves to become so dependent upon one type of soybean, one variety of corn...we don't seem to be able to learn from history. Here is a link to an article discussing that pathogen:

 

http://www.motherearthnews.com/natural-home-living/pathogen-in-roundup-ready-soy-corn-could-lead-to-calamity-scientist-warns.aspx

[LibraryLover]

http://www.thedailyshow.com/full-episodes/wed-june-29-2011-tom-hanks

[WishboneDawn]

A little off topic, but I agree about the chickens. I have always raised "Red Star" chicks. They never set on their eggs. I was bragging to my dad that if everything collapsed at least we could have eggs and he said "No we won't, those things can't even reproduce." He was right. I just ordered 25 chicks from breeds that can reproduce themselves. :)

 

I've got Cornish crosses and will probably get red sex-linked (same as your Red Star I think?) for layers. They're very economical.

 

But...I'll also be picking up some heritage breeds. There's a place in my heart, and on my lawn, for both. :)

[Trish]

My view is that the economy is based on a system that requires it to keep growing, while we live on a planet that stays the same size. As human population keeps growing and a "healthy" capitalist system requires us to consume more and more, we are headed for inevitable collapse, as the Earth just can't keep up. I'm very worried about food shortages caused by overpopulation and global warming in the not-too-distant future, and can't separate the economy from our unreasonable demands on the planet.

 

:iagree:

 

Excellent point. As currently consituted, most developed economies depend on constant growth, AND increases in the ability to borrow. Both of which cannot go on indefinitely. I believe 2008 was the speed bump, and 2011 will be THE WALL.

[WVNA]

But, we must do both- cut spending and increase revenue. Otherwise, you are just kicking the can down the road.

 

 

There are three problems I have with the logic of saying we have to increase revenue(which I assume you mean tax rate increases). The first problem is that without very strict fiscal handcuffs on politicians of both major parties, raising taxes is just like giving an alcoholic the keys to a liquor store and asking nicely not to go in there. Do you think they would do something prudent like paying down the national debt or on foolish ways to get themselves elected?

 

The second issue is that if you go back and look at tax revenue historically, the percentage of revenue as compared to US GDP is very constant regardless of what the actual tax rates are. You can see this here - http://www.fundmasteryblog.com/wp-content/uploads/2008/05/wsj-tax-revenue-chart-ed-ah556b_ranso_20080519194014.gif.

 

Finally, if you add up all the taxes we have to pay - federal, FICA, state, property, sales, utilities, city, etc - there's already a good chunk of our money that is being sent to government at some level.

[ma23peas]

There are three problems I have with the logic of saying we have to increase revenue(which I assume you mean tax rate increases). The first problem is that without very strict fiscal handcuffs on politicians of both major parties, raising taxes is just like giving an alcoholic the keys to a liquor store and asking nicely not to go in there. Do you think they would do something prudent like paying down the national debt or on foolish ways to get themselves elected?

 

The second issue is that if you go back and look at tax revenue historically, the percentage of revenue as compared to US GDP is very constant regardless of what the actual tax rates are. You can see this here - http://www.fundmasteryblog.com/wp-content/uploads/2008/05/wsj-tax-revenue-chart-ed-ah556b_ranso_20080519194014.gif.

 

Finally, if you add up all the taxes we have to pay - federal, FICA, state, property, sales, utilities, city, etc - there's already a good chunk of our money that is being sent to government at some level.

 

:iagree: No tax increases...the government needs to learn how to live on a budget, period. If you raise taxes, you will be putting a larger burden on the private sector/small businesses/corporations that need to stimulate jobs..our government (as seen by the failing roads program that was meant to stimulate jobs all across the country) fails at stimulating job increases.

 

If jobs increase, revenue increases..when you are in an economy where unemployment is getting worse by the week, raising taxes will cripple our economy....cut unnecessary programs, cut earmarks on spending, a simple 8 million dollar project once hit with earmarks can end up being 80 million...that has got to stop. It is time we demanded that our government be fiscally responsible, period. Not look for avenues to make it 'look' like they're being responsible by raising the debt ceiling "See, we don't owe that much...." when the bucket is about to explode. It is outrageous.

[WVNA]

My view is that the economy is based on a system that requires it to keep growing, while we live on a planet that stays the same size. As human population keeps growing and a "healthy" capitalist system requires us to consume more and more, we are headed for inevitable collapse, as the Earth just can't keep up. I'm very worried about food shortages caused by overpopulation and global warming in the not-too-distant future, and can't separate the economy from our unreasonable demands on the planet.

 

This is an excellent point. There are two words I'd like to add to your sentence about your concerns though: peak oil. There are definitely issues with other resources and their consumption such as rare earth elements needed for windmills and electric cars, but oil is the most important one. These are all geological constraints that no amount of printing by Ben Bernanke's magical printing press can solve.

[Trish]

If anyone pays attention to financial news, there is some BIG stuff going on in Europe the past couple days (in terms of debt-laden economies and a potential Greek default, plus major problems in Italy). This could easily have ramifications in the USA and worldwide.

 

I think it's inevitable (global economic meltdown and "collapse" followed by Who-Knows-What), but timing of such things is extraoordinarily hard to predict. But things are definitely heating up at this moment.

[A.Balaban]

Most of you all said the main points very well: It's inevitable. The world economy will collapse.

 

In the U.S., I feel a lot of the issues stem from the "BIG" companies- Oil & Ag. Of course, the divided (and divided) Congress doesn't help matters.

 

A government needs to be accountable and be able to correct itself in situations like this- and the people need to be able to trust their government to take care of them. Our government has been failing to do this for a very long time.

 

I do not think raising the debt ceiling will help the economy much, it just sticks a cork in a situation that is about to blow anyway.

 

Where we are stuck now, whether to decrease spending, or to increase taxes is difficult. I believe that the wealthy should have to pay more taxes. Plain and simple- the amount of money that professionals- whether it is in finance, computers, entertainment, etc- are making a ridiculous amount of money. This tax raise should NOT affect Americans who do not make a lot of money.

 

But, then, we need to cut spending so that we continue to decrease our debt. Make states more accountable for their own programs and funding. Make states more accountable to the federal government.

 

Basically, I want to do everything the republicans hate, and everything the Democrats hate. Only by making the TOUGH CALL and realizing that is what is best for your "Party" make not be whats best for AMERICANS. I feel like we are too used to being taken care of.

 

... Honest, I hope our economy collapses.

[ma23peas]

Where we are stuck now, whether to decrease spending, or to increase taxes is difficult. I believe that the wealthy should have to pay more taxes. Plain and simple- the amount of money that professionals- whether it is in finance, computers, entertainment, etc- are making a ridiculous amount of money. This tax raise should NOT affect Americans who do not make a lot of money.

 

 

Consider this:

 

"The top 1 percent of earners account for 20.3 percent of total personal income in the United States and pay 21.5 percent of all federal and state taxes. The middle 20 percent of households earn 11.6 percent of US income and pay 10.3 percent of taxes. The lowest 20 percent account for just 3.5 percent of income, and pay 2 percent of all taxes.

 

the lowest fifth of earners pay, on average, 16 percent of their income in taxes. At the higher end of the scale, the top fifth pay a bit more than 30 percent of their income in taxes, not much higher than the next fifth down.

 

And within that top tier, the top 1 percent pay 30 percent of their income in taxes, which is actually a bit less than the 31 percent of income that the next 9 percent of taxpayers pay.

 

The top 1 percent of earners account for 20 percent of "adjusted gross income" (an Internal Revenue Service measure) and pay 38 percent of income taxes. That shows how the income tax itself is progressive.

 

The current structure of tax brackets has rates that start at 10 percent of income at the low end and rise to 35 percent for the highest earners. In the middle are brackets of 15, 25, 28, and 33 percent. That top bracket doesn't mean the rich pay 35 percent of their adjusted gross income in taxes. Deductions and other factors lower their effective rate to 23 percent of income."

 

I disagree with your premise that make the rich pay more...Their income is a big part of what stimulates our economy, through investments/growth...if you only raise their taxes, you will have much larger middle class and lower middle class that can not stimulate our economy...a millionaire can take 250k and invest it into a start up business..you give 50 middle classers 5k each and they can not use that to stimulate growth...and they won't qualify under today's requirements for loans with that little capital.

 

The tax structure needs to be overhauled...give up ALL deductions..make EVERYONE in this country pay taxes!! Do a fair tax system where those making under 50k a year pay 10%, those making up to 150k pay 15%, those making over 250k pay 20% and those making over 500k pay 25%...technically that is still a 'raise' on the rich from what they are paying now..

 

Do away with the IRS!!! The amount of deductions/credits etc. that everyone has to work through is ridiculous! So, if you bought a Ford product or GM you get a discount but if you buy a gas saving Prius, you get no discount, even though the cars are made here in the US? You get a credit for buying an energy efficient AC unit, but had to pay 2k more for it and it probably won't save you money over the one that was cheaper to begin with...here's where money is just flying out the door...

 

* Tax exclusion for employer contributions to health insurance: $659.4 billion

* Deduction for mortgage interest on owner-occupied houses: $484.1 billion

* Lower tax rates for dividends and long-term capital gains: $402.9 billion

* Tax exclusion of pension contributions (defined-benefit): $303.2 billion

* Earned income tax credit: $268.8 billion

* State and local tax deductions: $237.3 billion

* Exclusion of pension contributions, 401(k)-style: $212.2 billion

* Exclusion of capital gains at death: $194 billion

* Charitable deductions: $182.4 billion

 

This is outrageous!! If we have the technology to check the weather system in Kyoko, pay online in seconds, skype to anywhere...then why can't our system be overhauled, get rid of the IRS...put in a automated tax structure that pulls our taxes out each month at the recommended rate..send electronic statements to those self-employed...and have a much smaller IRS responsible for tracking down payments....right now 85% of the IRS could be done away with a system like above....

 

If you live in this country you should pay taxes, regardless of how much you make, but I do believe they should be lowered by income...but not exempted...