This picture sums up beautifully our current economic situation and in the long run the very policies to help to poor will drown them.
For the (asset) rich they have assets be the property , shares or fine wines. When the monetary spigot turns on their assets rise in price. Just pull up a graph of QE and the S&P to see this affect – all the money printing does them no harm at all. There assets rise in value.
The middle classes will have some assets but not enough to shelter them from all price rises, money printing (ie inflation) will eventually seep into the weekly food shop , and they may even need to sell some of their assets to make ends meet.
Those at the bottom will suffer the most , higher price for everything , their wages are sticky and low , and very unlikely to move at the rate that prices are rising in the economy.
They will also have no/limited assets to cash in on. They may get lucky and have some of their debt inflated away , that assumes their wages will rise with inflation.
You also have to have spare money to pay off debt, if you are spending ever larger amounts on food (due to inflation) you are left with a very small to save or pay off debt all the while the debt racks up.
This popped up on my Reddit feed today and makes for a simple but pertinent point.
We have a tendency to put ourselves in a camp/tribe should that camp or tribe then have political success , followers of the tribe feel that they have to parrot all the political talking points of their leaders. Even if they know that deep down it makes no sense.
I have seen this at Political meet ups recently,” if it were the Reds doing this (lockdowns for example) then we (blues)would say that “this is abhorrent and must be over turned”, but if our side is doing then it’s just fine they can take away all of rights and liberties at the drop of a hat and there is no push back as it our side in power.
There is no reason why you can be inside of a political party and be critical of it at the same time. In fact the only ways that parties transform and change if individuals are brave enough to want to change it from the inside.
This also give the opportunity for others to faults in those that we are electing – but it requires that you stand up and point out these flaws.
Those at the grassroots of parties must speak truth to power Vs politicians telling us what to parrot.
This is an argument that is often levelled at the left.
Socialist: Socialism can work and it will work and we can make things better for all in one go.
Me: Here are all the countries where we have tried and it it has failed.
Socialist: But they were not real Socialism.
I’ll leave that there because often what happens next is a 3 hour debate/argument while both sides continue to get more drunk .
But for me what is more worrying is (sometimes even more than the pretend socialist countries and individuals) , are freemarket and free thinking individuals who are happy to have these chipped away at over time and slow Fabian march of Socialism comes anyway it just takes a longer time , but the ends are exactly the same just less violent.
This is much more subtle and comforting and we think nothing of our freedoms (both at the individual and in the market place) and liberties being chipped away at overtime but it equally something worth worrying about it.
When discussing with fellow parents to what other options there was to staying home and furloughing everyone “I said the Swedish Option perhaps ” well that went down as well as last of the cold meat ball on Sunday at Ikea.
Now that we have gotten everything that we wanted free money , stay home with the kids and watch Netflix till or eyes pop out this by the way is the exact opposite of what the Swedes did.
Our financial reckoning will come and it will have to be paid (inflation/taxes/austerity or perhaps some of all three).
And we will wish that we had done what the Swedes done , at that point of time in the future it will seem almost crazy that we took the action that we did .
This is something that often thrown up at Libertarians that we are top hat donning ; monacle wearing scrounges . And that could not be further from the truth. The reality requires a little more thought what we are arguing for a society where as many of the responsibility for you, and your family are taken by yourselves. And the state is responsible for the absolute minimum.
So if you wanted to spend your spare money ,time and resources to look after orphans like philanthropists did in years gone by then you are free to do so. But what we have now is a situation where we are now taxed at 45-50% when you account for all of the taxes that we pay – you could also add a 3% inflation tax but let’s leave that for a another post
And then when you complain about all the tax you pay , they say you want orphans to starve ? If that was all our taxes were funding it would not be so bad.
But more importantly they forget that foundling hospitals were founded by Philanthropists of the time and not the state. But this history has been forgotten about and we now have the state providing most care and private charity and private welfare has been crowded out.
I find that history begins (for those who are of a very pro statist mind set) the moment the state gets involved. And prior efforts that were working as part of a wider civil society are quickly forgotten about.
Going out for drink or meal with a friend is no longer possible with out it becoming political. In this instance BLM activists insisted that someone sitting at a restaurant give “their salute” from the footage that I have seen the lady did not give it and was very brave for not having done so.
No will dbout that it is important to march and speak your mind . But to mandate that everyone else who is nearby also do it too is madness. Also makes your movement seem unhinged and unable to win over individuals unless they are forced to participate.
Here is the actual photo of the incident below.
Everyone is being forced into political movements even when all you are doing is going out for dinner.
It is possible to have Socialism on a small scale when there maybe something in common that binds us together it maybe that we are part of the same religious organization , we are in the same family or extended community.
Where what we put in the common kitty will be acknowledged and appreciated and those that take will be conscious that they are taking from members of their own community.
In the current situation where the Socialism or the slow ever creeping Socialism of the economy that we have in the West , this idea is being destroyed. We all put into the kitty (not much choice about this) and then we have lots taken out, there is a point where those taking out are getting so much that those working think better of that I leave working and join everyone else not working as they seem to be getting so much for “free”.
Obviously not everyone will make this choice but at the margin there will be those who work is paying me $500 per week but I can benefits and cash payments not upto $700 for not working ??
Once there is no more horses pulling the cart (there all in cart too) who will pull the economy forward ?
When we have this level money printing the consequences of this debased are numerous. One of those that goes unnoticed by many is that we continue print up money to allow companies to furlough or bail out companies this delays the opening up of the economy. In years gone by the bond vigilantes would have started to ask for a higher rate or return on money that is being leant to the Government.
Now that this deficit spending is being monitized by Central Banks this effect has been neutered and yields are < 1%.
The consequence of this action is that we can continue to keep the economy closed longer than we should as the money being used for this essentially free (for the time being). At the same time we are building up within the population that this is all free of any cost or side affects.
This allows those on the both sides of the political spectrum left and right to falsely believe they can spend without their being any consequences, this will lead continued deficit spending on both sides and continued belief that montizing debt can go on indefinitely , central bankers have to know their economic history , but just like rulers of Rome they hope to push the problem on someone else’s reign.
Bread and Circuses for all ! (Famine and Debt for the Grandkids)
Not been watching mainstream news media for about 4 years and I much happier for it. Instead opted for streaming services (entertainment )and podcast for a better coverage of current affairs and better analysis too.
This has happened before I watched and read the following video but it sums up neatly many of the reasons that I have given up on the old media format esp the news
