Preventing US economic collapse

[WhipperSnapper]

Originally posted by: Acanthus

Without the fundamentals in high school, a career in engineering can be a 5 or even 6 year program if you leave it to the colleges...

College Algebra, College Trig, Calc I, II, III, Linear Alg, Differential Equations... the list goes on.

Science is even worse, Physics, Chem, Bio, and all combinations thereof require math skills that many of our students dont get from high school. So for them to START their science tracks they have to wait on the math fundamentals they didnt get.

The solution? Students take non-science/eng Majors.

You're missing something...the students who go on to major in engineering and the sciences are the types who will take those courses. It's not like they aren't being offered today.

Did you ever stop to ask what percentage of the employment force needs that knowledge? Most jobs don't make any use of a college degree, even jobs where the employers only hire people with college degrees (using it as a proxy for evidence of responsibility, work ethic, discipline, and/or IQ).

Also, are you aware that a huge percentage of the "new jobs" being created today are low-wage service jobs that don't make any use of science or advanced math?

Is it really necessary for the truck driver to know linear algebra? Does the waitress really need a knowledge of quantum mechanics? Does the grocery store manager need to know about chemistry? Does the factory worker need to know calculus? Does the mailman need to know about molecular biology?

Of course, it would be nice if people had that kind of knowledge so they could enjoy interesting mental ruminations as they labored in their low-wage service jobs. The Walmart stocker whose formerly middle class factory or computer programming job was shipped to China or India might enjoy contemplating the intricacies of quantum mechanics as he stocks the shelves, but does he really need to use that knowledge?

Education is like anything else in a relatively free market economy. If it is profitable to obtain that knowledge and if it makes economic sense to do it--people will do it. It's amazing how few people understand that. Ever wondered why so many people apply to medical school? However, when the supply of jobs that make use of scientific and mathematical knowledge is low relative to the number of people trained to do that kind of work, perhaps due to offshoring or due to the jobs being filled by imported labor on H-1B or L-1 visas, then people really don't want to invest their time, money, and lives on such affected fields.

Duh!

Keep drinking the politicians' and the media's Kool-Aid. Our politicians, backed by corporations that want cheap labor, are using claims that Americans need better education as an opiate of the masses instead of addressing the real issues that affect the American economy and quality of life, such as global labor arbitrage, mass immigration, and population explosion.

 

[Dissipate]

A prerequisite for avoiding economic collapse is ending the Federal Reserve and going back to a free market currency.

 

[Jaskalas]

Originally posted by: Stunt
What does the USA need to do in order to prevent economic collapse?

These are my thoughts...

1. Drastic reform of its public education system. Strict standards for science and math. Strict standards for discipline. No more coddling of students - fail them if they don't meet standards, only gives an "A" to those who are clearly excellent. Introduce competition.

2. Reform the tax system to encourage savings and discourage consumption (consumption taxes). The USA current fuels the growth of other economies like China through consumption and it does so at the expense of its current accounts.

3. Reign in government spending. Deficits are fine so long as they are financed internally. Currently, the US debt is largely being financed by China (a potential enemy).

4. Stop nation building. It is too expensive. Crush your enemies and then either take over completely or leave - no more of this infrastructure and democracy building.

1: Sure, but the Unions want all the funding, and they control the politics behind the schools.
2: Not entirely sure, but I'm not opposed to it.
3: Yes
4: Hell yes.

 

[HombrePequeno]

Originally posted by: Spartan Niner
My list:

1. Non-interventionist foreign policy. Wow, we suddenly stopped spending $billions a day.
2. Stop "nation-building". Our Founding Fathers wisely advised us to avoid "foreign entanglements"
3. Limited government. Our government has grown too large, powerful and SPENDS WAY TOO MUCH
4. Sound currency. Reform the Federal Reserve system, cut the national debt, and transition from our current fiat currency to a commodities-backed currency. No fiat currency lasts.
5. Reform taxes. Hell, cut taxes. We can afford it once we do the following (as a start):
6. Get rid of Dept. of Homeland Security for starters, then cut other unnecessary bureaucracies.
7. Get rid of Social Security. It's a Ponzi scheme which taxes the young to pay the elderly and it will only work for a short while longer. While we're at it, get rid of Medicare and some other programs.

With regards to #4, you could really say the same about commodity backed currency. The Gold Standard operated for roughly 80-90 years which really isn't that long. Countries were forced to go off the Gold Standard numerous times over the years. Saying that fiat currencies don't last is ridiculous. Even during the Gold Standard, there were quite a few countries that just had their currency backed by foreign currency. Looking at the US dollar, it's been fiat essentially since the 1930s. Yeah it was 'backed' by gold but conversion from gold was severely limited so we've pretty much had fiat currency since the 1930s. Besides the attack on the dollar in the early 1970s, the dollar has been an extremely stable fiat currency.

There is nothing wrong with a fiat currency as long as the growth of the money supply is fairly stable which it has been for the past twenty years. A commodity based currency gives up all monetary sovereignty. We wouldn't be able to tailor our monetary policy to economic shocks that occur in our country. The same thing happens in any country that pegs their currency to another. Brazil, Argentina, Thailand, etc. can tell you how well pegged currencies have worked for their economy. In the long-run a pegged currency cannot last. The only reason the Gold Standard lasted as long as it did was because there wasn't a large amount of globalization until the early 1900s and there were a lot of capital controls.

 

[Dissipate]

Originally posted by: HombrePequeno

With regards to #4, you could really say the same about commodity backed currency. The Gold Standard operated for roughly 80-90 years which really isn't that long. Countries were forced to go off the Gold Standard numerous times over the years. Saying that fiat currencies don't last is ridiculous. Even during the Gold Standard, there were quite a few countries that just had their currency backed by foreign currency. Looking at the US dollar, it's been fiat essentially since the 1930s. Yeah it was 'backed' by gold but conversion from gold was severely limited so we've pretty much had fiat currency since the 1930s. Besides the attack on the dollar in the early 1970s, the dollar has been an extremely stable fiat currency.

A fiat currency could last forever if it was in the hands of angels, but of course it is not. It is in the hands of short sighted politicians. The reason why the U.S. dollar will eventually become worthless is because the federal government is going to go bankrupt within the next coming decades when all of the trillions of dollars of unfunded liabilities of the welfare state come due. At that point the government will only have 2 options:

1. Print its way out of the bankruptcy, causing enormous inflation.

2. Default on the liabilities, causing mass political unrest and the collapse of the Federal Reserve.

Either way, it is screwed. In essence, fiat currencies are doomed because no government lasts forever, not even the U.S. government. Even Jean-Jacques Rousseau admitted this in his writings.

 

[CADsortaGUY]

While some of the ideas thrown out there are great, it doesn't seem like anyone takes issue with the premise of the OP. The US economy is no where near collapse. Yes, there will be highs and lows but "collapse" - doubtful at best even if we didn't change the things people are suggesting.

 

[heartsurgeon]

The DOW breaks 14,000 and your worrying about economic collapse?????

Utter disconnect with reality (must be a Democrat).

Like many things, when clinton was in office, the DOW "rose" because of speculation and the anticipation of a quick score. The fundamentals were wrong, and the DOW deflated.

The rise in the DOW now, is accompanied with strong fundamentals. This is not a speculative bubble like the last time around. this is secondary to a strong economic foundation.

move on, nothing to see here....

 

[imported_Shivetya]

Originally posted by: mfs378

Originally posted by: Stunt

Originally posted by: mfs378
Does the purchase of stock or investments count as consumption in your view?

No...stocks and investments are savings; complete opposite of consumption.

So people with more income, who have more money to invest will be paying fewer taxes as a fraction of their income?

A lot of people pay essentially nothing on their incomes. A consumption tax would actually have them paying again.

Income taxes should be abolished, get people for what they spend, not what they make. That way everyone gets hit properly.

 

[SarcasticDwarf]

Originally posted by: WhipperSnapper

Originally posted by: Stunt

1. Drastic reform of its public education system. Strict standards for science and math. Strict standards for discipline. No more coddling of students - fail them if they don't meet standards, only gives an "A" to those who are clearly excellent. Introduce competition.

Ignoring the increased costs of providing better education, how will better education help the economy?

It's nice to think that truck drivers can contemplate quantum mechanics and that waitresses understand differential equations, but do they really need that knowledge? The U.S. still has a gigantic number of colleges and college graduates and a great many unemployed and underemployed college graduates, including in technical fields (especially in the sciences and computer fields).

I would assume you are talking about college education, and are therefore talking out of your ass. Technical colleges exist for a reason. Some states (such as Wisconsin) have a very strong technical college system that trains students to be excellent workers in fields without bachelor degree requirements.

 

[CPA]

Originally posted by: mfs378

Originally posted by: Stunt

Originally posted by: mfs378
Does the purchase of stock or investments count as consumption in your view?

No...stocks and investments are savings; complete opposite of consumption.

So people with more income, who have more money to invest will be paying fewer taxes as a fraction of their income?

Hopefully. Poor people don't create jobs.

 

[rudder]

Do not hand out amnesty to 20+ million illegals in this country. It will create a large permanent underclass which will shrink the existing middle class even more as wages are pulled down as the next wave of amnesty seeking illegals hit this country.

 

[dmcowen674]

Originally posted by: Stunt
Topic Title: Preventing US economic collapse

Topic Summary: What do you think needs to be done? Is it even an issue?

What does the USA need to do in order to prevent economic collapse?

These are my thoughts...

1. Drastic reform of its public education system. Strict standards for science and math. Strict standards for discipline. No more coddling of students - fail them if they don't meet standards, only gives an "A" to those who are clearly excellent. Introduce competition.

2. Reform the tax system to encourage savings and discourage consumption (consumption taxes). The USA current fuels the growth of other economies like China through consumption and it does so at the expense of its current accounts.

3. Reign in government spending. Deficits are fine so long as they are financed internally. Currently, the US debt is largely being financed by China (a potential enemy).

4. Stop nation building. It is too expensive. Crush your enemies and then either take over completely or leave - no more of this infrastructure and democracy building.

OMFGBBQ :Q

I never thought I'd see the day. I'm proud of you man.

What brought about this revelation?

Although it does seem you are not quite 100% sure because you also put "Is it even an issue?" at the end there.

1) We absolutely must return to science and math.

Students are now brainwashed to a test that does not focus on those and focusing strictly to pass a certain test does not learning make, that makes dummy robots incabale of critical self thinking.

2) The financial system has been turned into a foriegn corporate whore system.

Start with reform by stripping the American charter from Companies that clearly have no U.S. operations other than on paper.

3) Strip the Government from free for all spending. There is no accountability whatsoever. It's simply nuts. Just because a "Lawmaker" asks for something does not mean they should get it.

4) This nation building crap is unconstitutional to begin with. I've asked a million and one times for anyone to show me in the Constitution where it says the U.S. is the world's policeman.

England nearly collapsed when it had it's Imperialism in place.

Hopefully if Democrats regain control the Imperialsm will stop.

You have to admit it is a Republican trait of this Nation building crap disguising oil grabbing.

 

[dmcowen674]

Originally posted by: Stunt

Originally posted by: mfs378

Originally posted by: Stunt

Originally posted by: mfs378

Originally posted by: Stunt

Originally posted by: mfs378
Does the purchase of stock or investments count as consumption in your view?

No...stocks and investments are savings; complete opposite of consumption.

So people with more income, who have more money to invest will be paying fewer taxes as a fraction of their income?

There can still be investment taxation. I am merely suggesting shifting the tax code to discourage wasteful spending and encourage saving. This can be done in many ways, not just cutting investment taxes. You can have more tax shelters like education savings plans, retirement savings plans, etc. Lower income taxes, lower corporate taxes (could be connected to infrastructure investment, automation, training). Basically increasing prices on goods with a sales tax and offset that revenue with cuts in areas that will encourage savings/investment.

If you reduce consumption and increase investment, how are all those companies we are investing supposed to turn a profit and make our investments grow?

Invest in equipment and improvements that don't have the required IRR (internal rate of return) to increase efficiency/productivity and profits.

There is no incentive to invest in equipment in the current state of offshoring everything.

Bring back manufacturing first and then there will be an incentive to improve equipment.

You're learning and I thought this would not be possible.

P&N must be having some effect. :thumbsup:

 

[dmcowen674]

Originally posted by: Rainsford

Originally posted by: Stunt

Originally posted by: mfs378

Originally posted by: Stunt

Originally posted by: mfs378
Does the purchase of stock or investments count as consumption in your view?

No...stocks and investments are savings; complete opposite of consumption.

So people with more income, who have more money to invest will be paying fewer taxes as a fraction of their income?

There can still be investment taxation. I am merely suggesting shifting the tax code to discourage wasteful spending and encourage saving. This can be done in many ways, not just cutting investment taxes. You can have more tax shelters like education savings plans, retirement savings plans, etc. Lower income taxes, lower corporate taxes (could be connected to infrastructure investment, automation, training). Basically increasing prices on goods with a sales tax and offset that revenue with cuts in areas that will encourage savings/investment.

That would have the opposite effect of what you're after here. Savings and investments don't drive economic growth, consumption does. Discouraging spending would not be a step in the right direction.

Granted, investment helps sustain economic growth, but it alone can't actually drive growth...we don't live in a supply driven economy.

Exactly, we must bring a good portion of manufacturing back home.

A country that cannot feed/manufacturer for itself is no longer a country, it is an island.

 

[HombrePequeno]

Originally posted by: heartsurgeon
The DOW breaks 14,000 and your worrying about economic collapse?????

Utter disconnect with reality (must be a Democrat).

Like many things, when clinton was in office, the DOW "rose" because of speculation and the anticipation of a quick score. The fundamentals were wrong, and the DOW deflated.

The rise in the DOW now, is accompanied with strong fundamentals. This is not a speculative bubble like the last time around. this is secondary to a strong economic foundation.

move on, nothing to see here....

That was a horribly short-sighted post. Stunt isn't talking about an economic collapse in the short term; he's talking about in the long term. Also, stock markets have little to do with the economic health of a nation. The Russian stock market was soaring right before its financial crisis in 1998 and the same goes for the Argentine stock market.

Originally posted by: Dissipate

Originally posted by: HombrePequeno

With regards to #4, you could really say the same about commodity backed currency. The Gold Standard operated for roughly 80-90 years which really isn't that long. Countries were forced to go off the Gold Standard numerous times over the years. Saying that fiat currencies don't last is ridiculous. Even during the Gold Standard, there were quite a few countries that just had their currency backed by foreign currency. Looking at the US dollar, it's been fiat essentially since the 1930s. Yeah it was 'backed' by gold but conversion from gold was severely limited so we've pretty much had fiat currency since the 1930s. Besides the attack on the dollar in the early 1970s, the dollar has been an extremely stable fiat currency.

A fiat currency could last forever if it was in the hands of angels, but of course it is not. It is in the hands of short sighted politicians. The reason why the U.S. dollar will eventually become worthless is because the federal government is going to go bankrupt within the next coming decades when all of the trillions of dollars of unfunded liabilities of the welfare state come due. At that point the government will only have 2 options:

1. Print its way out of the bankruptcy, causing enormous inflation.

2. Default on the liabilities, causing mass political unrest and the collapse of the Federal Reserve.

Either way, it is screwed. In essence, fiat currencies are doomed because no government lasts forever, not even the U.S. government. Even Jean-Jacques Rousseau admitted this in his writings.

I'm assuming when you talk about massive unfunded liabilities you're talking about Medicare and Social Security. I would agree with both of your points if the government was actually forced to pay out those benefits. They have no need to do so and if they do they'll have to raise taxes to do it.

I'll tell you the reason quite a few fiat currencies fail: they're in the hands of the government and not an independent central bank. The more sway a government has on its money supply, the likelier they are to use inflation as a tax. That coupled with a government that lacks fiscal restraint is recipe for disaster.

 

[imported_Shivetya]

Originally posted by: dmcowen674Hopefully if Democrats regain control the Imperialsm will stop.

You have to admit it is a Republican trait of this Nation building crap disguising oil grabbing.

Democrats are far more likely to engage in Nation Building than Republicans.

Just picking on the most previous example.

Missile attacks versus Afghanistan
Missile attacsk versus Sudan
Deployed Troops to Somalia
Military attacks versus Kosovo and Serbia (not approved by UN security council btw)
Invaded Haiti (over objections of Congress)
Multiple attacks against organizations inside of Iraq
Banning all trade with Iran (1995), attempts to force regime change
Increased sanctions against Cuba


Imperialism at its finest... its the American way.... thank you theodore Roosevelt!

 

[Dissipate]

Originally posted by: HombrePequeno
I'm assuming when you talk about massive unfunded liabilities you're talking about Medicare and Social Security. I would agree with both of your points if the government was actually forced to pay out those benefits. They have no need to do so and if they do they'll have to raise taxes to do it.

What do you mean they have no need to? Those benefits are promised to the future baby boomer retirees. They really can't raise taxes, or at least not nearly enough to cover the shortfall. The estimates are in the 40-70 trillion dollar range.

I'll tell you the reason quite a few fiat currencies fail: they're in the hands of the government and not an independent central bank. The more sway a government has on its money supply, the likelier they are to use inflation as a tax. That coupled with a government that lacks fiscal restraint is recipe for disaster.

If you think the Fed is an 'independent' central bank, you have a lot of reading up to do. The Fed has been financing the government's debt and has been allowing it to inflate the currency since its inception.

 

[rudder]

Originally posted by: dmcowen674

1) We absolutely must return to science and math.

Students are now brainwashed to a test that does not focus on those and focusing strictly to pass a certain test does not learning make, that makes dummy robots incabale of critical self thinking.

Althought its intentions are good... No Child Left Behind forces teachers to disregard all critical thinking skills and focus on getting a good showing on a yearly standardized test. Very sad indeed.

Bring on the school voucher!

 

[HombrePequeno]

Originally posted by: Dissipate

Originally posted by: HombrePequeno
I'm assuming when you talk about massive unfunded liabilities you're talking about Medicare and Social Security. I would agree with both of your points if the government was actually forced to pay out those benefits. They have no need to do so and if they do they'll have to raise taxes to do it.

What do you mean they have no need to? Those benefits are promised to the future baby boomer retirees. They really can't raise taxes, or at least not nearly enough to cover the shortfall. The estimates are in the 40-70 trillion dollar range.

I'll tell you the reason quite a few fiat currencies fail: they're in the hands of the government and not an independent central bank. The more sway a government has on its money supply, the likelier they are to use inflation as a tax. That coupled with a government that lacks fiscal restraint is recipe for disaster.

If you think the Fed is an 'independent' central bank, you have a lot of reading up to do. The Fed has been financing the government's debt and has been allowing it to inflate the currency since its inception.

They have no need to fulfill those obligations because nobody is entitled to them. Those benefits are just assumed to be there, the Supreme Court has already stated that Social Security is just a tax and nobody is entitled to the benefits. I'm guessing Congress is going to do a combination of cutting benefits, raising taxes, and raising the retirement age.

The Fed is not an entirely independent central bank but it is a lot more independent than most.

 

[WhipperSnapper]

Originally posted by: rudder
Do not hand out amnesty to 20+ million illegals in this country. It will create a large permanent underclass which will shrink the existing middle class even more as wages are pulled down as the next wave of amnesty seeking illegals hit this country.

It's worse than you think. Those 20 million illegal aliens will also suck down tax dollars in the form of education spending and health care spending, not to mention criminal justice costs. Alternatively, if spending and taxes remain the same, the quality of education and health care for the poor will have to decrease.

 

[imported_Shivetya]

Originally posted by: rudder

Originally posted by: dmcowen674

1) We absolutely must return to science and math.

Students are now brainwashed to a test that does not focus on those and focusing strictly to pass a certain test does not learning make, that makes dummy robots incabale of critical self thinking.

Althought its intentions are good... No Child Left Behind forces teachers to disregard all critical thinking skills and focus on getting a good showing on a yearly standardized test. Very sad indeed.

Bring on the school voucher!

Teachers Unions have more affect on what is taught and not taught than NCLB idd. NCLB simply revealed how much schools waste when it comes to taxpayer money on things other than students and teachers

 

[Dissipate]

Originally posted by: HombrePequeno

Originally posted by: Dissipate

Originally posted by: HombrePequeno
I'm assuming when you talk about massive unfunded liabilities you're talking about Medicare and Social Security. I would agree with both of your points if the government was actually forced to pay out those benefits. They have no need to do so and if they do they'll have to raise taxes to do it.

What do you mean they have no need to? Those benefits are promised to the future baby boomer retirees. They really can't raise taxes, or at least not nearly enough to cover the shortfall. The estimates are in the 40-70 trillion dollar range.

I'll tell you the reason quite a few fiat currencies fail: they're in the hands of the government and not an independent central bank. The more sway a government has on its money supply, the likelier they are to use inflation as a tax. That coupled with a government that lacks fiscal restraint is recipe for disaster.

If you think the Fed is an 'independent' central bank, you have a lot of reading up to do. The Fed has been financing the government's debt and has been allowing it to inflate the currency since its inception.

They have no need to fulfill those obligations because nobody is entitled to them. Those benefits are just assumed to be there, the Supreme Court has already stated that Social Security is just a tax and nobody is entitled to the benefits. I'm guessing Congress is going to do a combination of cutting benefits, raising taxes, and raising the retirement age.

The Fed is not an entirely independent central bank but it is a lot more independent than most.

Telling the millions of retiring baby boomers that they aren't going to get anything is going to go over real well.

 

[HGC]

1. Taxes-Cut the top personal income tax rate to 25% and eliminate the corporate tax and the death tax.
2. Spending- Eliminate all corporate welfare. Change Social Security and Medicare to a system of mandatory personal retirement and health savings accounts.
3. Trade- 10% across the board flat tariff for imports, with 0% for countries who reciprocate.
4. Regulation- Repeal McCain Feingold and replace with unrestricted spending on political advertising and campaigns, with all donations required to be posted on the internet the day they're made.

 

[Ozoned]

Originally posted by: Stunt
What does the USA need to do in order to prevent economic collapse?

We need to grow to survive. I am thinking Canada would fit quite nicely in our portfolio.

 

[Engineer]

Originally posted by: Ozoned

Originally posted by: Stunt
What does the USA need to do in order to prevent economic collapse?

We need to grow to survive. I am thinking Canada would fit quite nicely in our portfolio.

LOL...but you forget that Mexico is annexing the US faster than we could annex Canada!