Korean Job Discussion Forums

[mises]

Ontheway is right in a general sense. Debasing the currency is no way to raise the standard of living for a society.

War, huh. What is it good for?

Debasing and ruining a country:

http://www.zerohedge.com/sites/default/files/images/SeanMaloneRiseFallDollarLarge.jpg


What is needed is an increase in the purchasing power of the middle class. Without that social security and the rest are dead. And the increase must not be accomplished with more access to debt. I have absolutely no idea how this could be done. I'm confident it won't be done. We're riding off into the sunset. I guess it was always Asia's world. We just borrowed it for a hundred years.

http://www.kpfa.org/archive/id/53994

If you want to ruin a few hours, give the link above a listen. Debt ruined us.

[Fox]

[visitorq]

[bacasper]

[ontheway]

Mises, that's a great chart on the dollar. It shows about a 95% decline in the value of the dollar since the creation of the Fed. There is a difference between the decline in purchasing power of the dollar, and its decline in value due to inflation caused by debasement. The decline due to debasement is generally greater than the actual loss in purchasing power because productivity increases make it look like the purchasing power decline is less than it really is.

Of course, debasing the currency by printing unbacked dollars, which is real inflation, is just one factor in the government's reduction in our living standard. Debasement is more important for the poor and middle classes who are robbed of their life savings and have little opportunity to get ahead without it. Continual inflation (debasement) encourages wasteful consumption, resource misallocation, bad investment decisions and causes recessions and depressions.

Social Security is much more evil. It's because it was designed as a pay as you go program, and it is over $40 trillion dollars in debt on an acutarially determined basis (which means it's a ponzi scheme 1000 times as big a the Madoff scheme.)

The disaster of social security ponzi scheme is that it acts as savings in the minds of the workers but is really debt. This means that every dollar that should be in the trust fund, and would be if it were legally funded (like any legal pension fund is required to be) would provide investment capital for the market. People reduce their savings by the amount of imputed savings that they feel has been accrued in their names in the fund. Savings rates, investment and economic growth are reduced by the $40 trillion that is missing.

The investment capital that is missing from Social Security would have created jobs and business expansion. It would have grown the economy. The jobs that were not created because the money was not there is a minimum of 500 million jobs, although a normally conservative estimate of the job loss due to the US social security program alone is now 1 billion jobs. If you use an assumption of lower capital requirements for job formation which actually match the marketplace in the varous countries involved, it is likely that the US Social Security program has prevented the creation of enough good jobs to employ every unemployed person on the planet by this time.

While Social Security has destroyed jobs and lowered living standards directly, and this coupled with the Federal Reserve has caused a great reduction in what our living standards otherwise would have become, you also have to factor in all the other detrimental programs, government spending, wars and regulations, and what income and other taxes have done. The net effect is a 90% reduction in what our living standards would have been. Actually, the studies showing this reduction are more than three decades old. The reduction at this point would be much greater.

Now, if you lack imagination you will be unable to see just what "stuff" we would buy with 10 times the income. The problem is a lack of vision. When we have 10 times the income, we will have created, invented and learned to produce a host of different "stuff" OR goods and services that are presently unavailable and unimagined by most individuals. It is the investment in the production of all sorts of major new goods and services that causes growth in living standards. The US government has prevented this investment, job creating and growth in living standards.

Many no-growth, slow growth or limited growth Luddites fail to comprehend that the potential for economic growth and increase in living standards is limitless. Being unable to conceive of what the growth would or could be only means that you lack insight, foresight and imagination. That's nothing new , in the late 1800's it was proclaimed that the US patent office could be closed because everything had been invented.

Living standards are raised by coming up with new or better things, new or better goods and services that improve the lives of people. The entrepreneur creats them, creates a business to produce them, invests his capital, hires people creating employment, and earns a reward in his profit. Everyone gains and living standards rise. This process is thwarted by almost everything that government does.

If you want to get a vision of some of what we don't have but would have if the government stayed out of the way, I suggest the Futurist magazine.

Here are a few of the things we have missed out on:

1) Integrated whole communities based on walking and human scale transportation and mass transit on the inside, built like campuses, like living in Central Park, shopping, work, education, entertainment, and quality environments integrated and convenient, with automobiles on the outside.

2) On the sea and under the sea developments for living and vacations.

3) Clean non-polluting production and lifestyles based on the free market which protects the environment instead of socialism which allows it to be polluted.

4) Higher living standards coupled with lower energy use. No oil shortages. No fossil fuel problems. No man-made global warming.

5) Human colonization of space and the lunar surface would already be well underway, funded by the free market. Middle class vacations to space and the moon would be available today.

6) Free market health insurance. "Whole-life" health insurance which is portable, non-cancellable, available from birth or even before birth, covering major illnesses and accidents, but not day to day health maintenance which should not be covered. There would be no health insurance crisis without the income tax, regulation of the insurance and health industries, and without the already horrible govt medicare and medicaid. With the country ten times richer, we would have better health care available to all, and plenty of generous, well-off individuals to pay for those few unfortunate souls who would still find themselves unable to afford what they need.

...

There are millions of ways that our lives could be better and our living standards could be 10 times higher than they are today.

But, of course, it takes investment to create these things. These things create jobs. Without savings and a free market these things are not possible. The government of the US is 99 TRILLION DOLLARS in debt according to the Federal Reserve itself. This represents capital that would have been available for investment if the government programs hadn't turned the people's savings intentions into debt.

Investing that 99 trillion, plus the rules, regulations, currency debasement and taxes are more than enough to have expanded our living standards, and those around the world, ten fold.

Studies by economists verifying these facts are in books, journals, various economics publications, think tank publications and are in university libararies around the US. I've never seen them on the Internet, but you might track down some info. If you want to understand these things, you'll have to go study them. It'll take you a few years, I suggest ten years, where you have to give up posting and ranting and go learn something. You will have to read books and study economics. Travel to various universities around the world. Study 16 hours per day, 7 days per week. Talk to real economists. Study at George Mason, U of Chicago, Mises Instute, Cato, throughout Europe...


Then, some guy with no experience and no economics background will want references to thousands of books, studies and research papers, classes, work experience and professional interviews to somehow link him into 40,000 hours of study and experience.

One more thing. In a discussion I had with a biographer of FDR, in Boston, from a well-heeled, well-connected family, an old friend of the Roosevelt family, I got this: