The hidden cost of having your cake and eating it too...
February 25, 2011 5:02 AM Subscribe
How do you feel about your investment in USA Inc.? Imagine for a moment that the United States government is a public corporation. Imagine that its management structure, fiscal performance, and budget are all up for review. Now imagine that you're a shareholder in USA Inc.
Wall Street analysts look at the financial health of the United States as if the country were a private business.
In essence, 80% of people see a balanced budget as a key concern for the country and 12% support cut-backs in the entitlement programmes necessary to achieve that budget balance.
The report is peppered with commentary about short-term risks, and recent events provide a good context for what can happen if the country does not unite around a platform of fixing these problems.
Wall Street analysts look at the financial health of the United States as if the country were a private business.
In essence, 80% of people see a balanced budget as a key concern for the country and 12% support cut-backs in the entitlement programmes necessary to achieve that budget balance.
The report is peppered with commentary about short-term risks, and recent events provide a good context for what can happen if the country does not unite around a platform of fixing these problems.
A public corporation with $14 trillion of debt on its balance sheet?
Could I invest my money in an Arby's franchise instead?
posted by Joe Beese at 5:11 AM on February 25, 2011 [5 favorites]
Could I invest my money in an Arby's franchise instead?
posted by Joe Beese at 5:11 AM on February 25, 2011 [5 favorites]
I see a bunch of rapacious CEOs who staged a hostile takeover with the intent of pumping up the stock value and cashing out with their golden parachutes before the whole thing collapses, leaving the employees, customers and shareholders in the lurch and ensuring that nobody will ever trust the brand name again. Am I right?
Oh, and nice use of the "usataxesausterityeconomymedicarecrisis" tag.
posted by Faint of Butt at 5:11 AM on February 25, 2011 [14 favorites]
Oh, and nice use of the "usataxesausterityeconomymedicarecrisis" tag.
posted by Faint of Butt at 5:11 AM on February 25, 2011 [14 favorites]
"In essence, 80% of people see a balanced budget as a key concern for the country and 12% support cut-backs in the entitlement programmes necessary to achieve that budget balance."
If only...if only there was some way the government could increase their revenue and achieve both goals!
posted by jaduncan at 5:11 AM on February 25, 2011 [52 favorites]
If only...if only there was some way the government could increase their revenue and achieve both goals!
posted by jaduncan at 5:11 AM on February 25, 2011 [52 favorites]
Aren't Treasury Bond holders essentially investors in USA, Inc. already? And what about the fact that the dollar is the world's reserve currency? Comparing the U.S. government to business has always seemed like a flawed concept to me, not even considering the fact we probably don't want them acting like a business.
posted by PhillC at 5:11 AM on February 25, 2011 [4 favorites]
posted by PhillC at 5:11 AM on February 25, 2011 [4 favorites]
"even considering the fact we probably don't want them acting like a business."
Don't worry, the USG already ensures the best service goes to high value customers.
posted by jaduncan at 5:12 AM on February 25, 2011 [2 favorites]
Don't worry, the USG already ensures the best service goes to high value customers.
posted by jaduncan at 5:12 AM on February 25, 2011 [2 favorites]
Really, someone should've talked to the founders before things got this far -- had they considered applying for nonprofit status, things would be a lot simpler...
posted by verb at 5:13 AM on February 25, 2011 [1 favorite]
posted by verb at 5:13 AM on February 25, 2011 [1 favorite]
I heard a quote the other day...since we're talking about the federal budget, and how to fix it.... the quote was:
"How come when we propose a 3% tax hike on the rich, it is socialism, and when we propose a 14% pay cut on the middle class, it's 'doing your share'?"
posted by tomswift at 5:13 AM on February 25, 2011 [95 favorites]
"How come when we propose a 3% tax hike on the rich, it is socialism, and when we propose a 14% pay cut on the middle class, it's 'doing your share'?"
posted by tomswift at 5:13 AM on February 25, 2011 [95 favorites]
Maybe next we can analyze a large corporation as if it were the federal government. What the fuck.
posted by norabarnacl3 at 5:19 AM on February 25, 2011 [15 favorites]
posted by norabarnacl3 at 5:19 AM on February 25, 2011 [15 favorites]
"even considering the fact we probably don't want them acting like a business."
We don't even want them to improve productivity?
posted by ZenMasterThis at 5:21 AM on February 25, 2011
We don't even want them to improve productivity?
posted by ZenMasterThis at 5:21 AM on February 25, 2011
Wall Street analysts *can't* look at the financial health of the United States as if the country were a private business. We don't even use those numbers ourselves. Accounting best practices exist for a reason, even if everyone seems to be ignoring them.
posted by jwells at 5:21 AM on February 25, 2011 [4 favorites]
posted by jwells at 5:21 AM on February 25, 2011 [4 favorites]
The industry responsible for the bubble that created pets.com may not be the precisely last one I want running public finances, but it's a very strong contender for that position. Treating the government like it's a business is full-on destroy-the-village-to-save-it magical thinking.
posted by feloniousmonk at 5:27 AM on February 25, 2011 [5 favorites]
posted by feloniousmonk at 5:27 AM on February 25, 2011 [5 favorites]
But governments do not work like businesses, do not have goals like businesses, and in general it is not helpful or illuminating in any way to think of government as a business.
Also I was skimming the pdf until I realized that it is mostly in slide format. This is not a good way to present information. Slides are to illustrate a talk, people.
posted by Arturus at 5:29 AM on February 25, 2011 [6 favorites]
Also I was skimming the pdf until I realized that it is mostly in slide format. This is not a good way to present information. Slides are to illustrate a talk, people.
posted by Arturus at 5:29 AM on February 25, 2011 [6 favorites]
While we're here: Why Austerity is Bullshit
posted by Arturus at 5:31 AM on February 25, 2011 [2 favorites]
posted by Arturus at 5:31 AM on February 25, 2011 [2 favorites]
can we leave social security out of "entitlement programs" since it's funded by its own separate regressive tax
posted by bhnyc at 5:32 AM on February 25, 2011
posted by bhnyc at 5:32 AM on February 25, 2011
Yes, the government should be run like a business, just like when we run our families like businesses. If junior isn't a profit center, he obviously needs to be sold off. After all it's ALL about money, isn't it?
posted by blue_beetle at 5:33 AM on February 25, 2011 [21 favorites]
posted by blue_beetle at 5:33 AM on February 25, 2011 [21 favorites]
"Wall Street analysts" don't have a great track record. Why would anyone take them seriously any more?
posted by Jode at 5:36 AM on February 25, 2011 [6 favorites]
posted by Jode at 5:36 AM on February 25, 2011 [6 favorites]
If the Federal Government balanced its budget tomorrow, it would throw America's economy into a Depression deeper and longer than that previous Great one.
If I could find a company that's run with as much compassion as the Federal Government (which I know is not that much), I'd be a loyal customer forever.
Why take "Wall Street analysts" seriously? If you don't, they'll kill you and eat you.
posted by oneswellfoop at 5:39 AM on February 25, 2011 [5 favorites]
If I could find a company that's run with as much compassion as the Federal Government (which I know is not that much), I'd be a loyal customer forever.
Why take "Wall Street analysts" seriously? If you don't, they'll kill you and eat you.
posted by oneswellfoop at 5:39 AM on February 25, 2011 [5 favorites]
plantations of america, inc
posted by pyramid termite at 5:39 AM on February 25, 2011
posted by pyramid termite at 5:39 AM on February 25, 2011
In the comments in the link I provided someone points to the Treasury report, but the link is borked. Here's a good one. For those looking for a prospectus, try here. Assets are 677 billion (US) less than Liabilities.
And I'm not sure how "Net Position" figures into the balance sheet equation (I'm out of practice) but it doesn't look good at any rate. We'd fail an audit and, if a publicly held company, trigger an SEC investigation... Which I sort of support, actually.
posted by jwells at 5:42 AM on February 25, 2011
And I'm not sure how "Net Position" figures into the balance sheet equation (I'm out of practice) but it doesn't look good at any rate. We'd fail an audit and, if a publicly held company, trigger an SEC investigation... Which I sort of support, actually.
posted by jwells at 5:42 AM on February 25, 2011
The old "run the government like a business" illogic taken far too literally.
posted by Thorzdad at 5:43 AM on February 25, 2011
posted by Thorzdad at 5:43 AM on February 25, 2011
In essence, 80% of people see a balanced budget as a key concern for the country and 12% support cut-backs in the entitlement programmes necessary to achieve that budget balance.
I'm having trouble parsing this sentence. What is "necessary to achieve that budget balance"? The entitlement programmes? No wonder nobody wants to cut them! That's some rock-solid Keynesianism right there. I'm surprised and a little bit touched to see "Wall Street analysts" demonstrating such generosity of spirit.
posted by A Thousand Baited Hooks at 5:47 AM on February 25, 2011
I'm having trouble parsing this sentence. What is "necessary to achieve that budget balance"? The entitlement programmes? No wonder nobody wants to cut them! That's some rock-solid Keynesianism right there. I'm surprised and a little bit touched to see "Wall Street analysts" demonstrating such generosity of spirit.
posted by A Thousand Baited Hooks at 5:47 AM on February 25, 2011
The interests of business are narrow, while the interests of the people are broad. How can we make the interests of government also narrow? Maybe hire someone with experience in doing so. I think Gadaffi may be looking for a job soon.
posted by pashdown at 5:47 AM on February 25, 2011 [1 favorite]
posted by pashdown at 5:47 AM on February 25, 2011 [1 favorite]
I haven't used USA Inc. in almost 9 years now. I'm a Dapper Japan Man.
posted by snwod at 5:56 AM on February 25, 2011 [10 favorites]
posted by snwod at 5:56 AM on February 25, 2011 [10 favorites]
Saying "The government isn't a business!" in response to a report like this amounts to sticking your fingers in your ears and going "La la la, I can't hear you!" especially four minutes after a 200 page document is linked. Can we drop the ideological blinders for once?
These numbers suck, and thus far into the thread no one seems to be questioning the accuracy of the numbers or the reality of their implications. We've got ad hominem attacks ("They're Wall Street CEOs!"), but no actual suggestion that there might be a real problem here. The report talks about ways of fixing the problems, and all options, including tax increases, are on the table. It is, in short, the most detailed, complete analysis of the federal government's long-term fiscal situation I've see in quite some time.
But no one seems interested in actually talking about it. Which is disappointing, but depressingly unsurprising with this crowd.
can we leave social security out of "entitlement programs" since it's funded by its own separate regressive tax
If you take the time to look through the linked document--which is over 200 pages--they basically do. The conclusion is that Social Security has been, in the long run, basically a break-even proposition, and their proposal for fixing it is, if I understand it correctly, a relatively modest tax increase. They wind up putting most of the blame on Medicare (especially Part D) and Medicaid.
posted by valkyryn at 6:00 AM on February 25, 2011 [12 favorites]
These numbers suck, and thus far into the thread no one seems to be questioning the accuracy of the numbers or the reality of their implications. We've got ad hominem attacks ("They're Wall Street CEOs!"), but no actual suggestion that there might be a real problem here. The report talks about ways of fixing the problems, and all options, including tax increases, are on the table. It is, in short, the most detailed, complete analysis of the federal government's long-term fiscal situation I've see in quite some time.
But no one seems interested in actually talking about it. Which is disappointing, but depressingly unsurprising with this crowd.
can we leave social security out of "entitlement programs" since it's funded by its own separate regressive tax
If you take the time to look through the linked document--which is over 200 pages--they basically do. The conclusion is that Social Security has been, in the long run, basically a break-even proposition, and their proposal for fixing it is, if I understand it correctly, a relatively modest tax increase. They wind up putting most of the blame on Medicare (especially Part D) and Medicaid.
posted by valkyryn at 6:00 AM on February 25, 2011 [12 favorites]
Why is a PR piece on the website of a venture capital firm (in this case: Kleiner Perkins Caufield & Byers) worthy of discussion?
posted by The Emperor of Ice Cream at 6:03 AM on February 25, 2011 [1 favorite]
posted by The Emperor of Ice Cream at 6:03 AM on February 25, 2011 [1 favorite]
Why is a PR piece on the website of a venture capital firm (in this case: Kleiner Perkins Caufield & Byers) worthy of discussion?
Why shouldn't it be? You even looked at it?
posted by valkyryn at 6:05 AM on February 25, 2011 [1 favorite]
Why shouldn't it be? You even looked at it?
posted by valkyryn at 6:05 AM on February 25, 2011 [1 favorite]
If the Federal Government balanced its budget tomorrow, it would throw America's economy into a Depression deeper and longer than that previous Great one.
But if it doesn't balance the budget, the eventual economic destruction as it prints money to fund its profligate spending will be even worse. It will take much longer to play out, but the damage will be so dire that we may never recover. By the time we get our feet back under us (a decades-long process) much of the cheap/easy resource deposits will be all used up. If scientists haven't figured out alternatives, we may never return to what we once were.
The problem with our bailout mentality and vast deficit spending is that there's no way back. There is no reasonable way we can stop. And the long-term outcome will be much worse than a mere depression. No matter how bad things get, it'll always involve more short-term pain to stop, so we won't stop. We'll just keep making the problem worse, until we go through a Russia-style collapse; whether it'll be a deflationary or hyperinflationary collapse is still hard to tell.
After seeing, in 2008, the way that the government ignored every rule it had, and just threw money at anyone that had a suit and an IOU from homeowners, I've been betting on inflation.
posted by Malor at 6:05 AM on February 25, 2011 [3 favorites]
But if it doesn't balance the budget, the eventual economic destruction as it prints money to fund its profligate spending will be even worse. It will take much longer to play out, but the damage will be so dire that we may never recover. By the time we get our feet back under us (a decades-long process) much of the cheap/easy resource deposits will be all used up. If scientists haven't figured out alternatives, we may never return to what we once were.
The problem with our bailout mentality and vast deficit spending is that there's no way back. There is no reasonable way we can stop. And the long-term outcome will be much worse than a mere depression. No matter how bad things get, it'll always involve more short-term pain to stop, so we won't stop. We'll just keep making the problem worse, until we go through a Russia-style collapse; whether it'll be a deflationary or hyperinflationary collapse is still hard to tell.
After seeing, in 2008, the way that the government ignored every rule it had, and just threw money at anyone that had a suit and an IOU from homeowners, I've been betting on inflation.
posted by Malor at 6:05 AM on February 25, 2011 [3 favorites]
Looks good to me! Keep up the good work Wall Street Analysts!
posted by Ad hominem at 6:05 AM on February 25, 2011
posted by Ad hominem at 6:05 AM on February 25, 2011
We don't even want them to improve productivity?
Depends on how you define productivity.
When it comes to providing services for something as vast and varied as a nation of 700+ million, on anything even close to an egalitarian basis, I'm afraid most of the usual corporate metrics of "productivity" simply don't/can't apply. Cause, y'know, corporations are run on an expressly non-egalitarian basis. This little point, of course, is exactly why the whole "run the country like a corporation" concept is an exercise in illogic and utter fail.
posted by Thorzdad at 6:11 AM on February 25, 2011 [1 favorite]
Depends on how you define productivity.
When it comes to providing services for something as vast and varied as a nation of 700+ million, on anything even close to an egalitarian basis, I'm afraid most of the usual corporate metrics of "productivity" simply don't/can't apply. Cause, y'know, corporations are run on an expressly non-egalitarian basis. This little point, of course, is exactly why the whole "run the country like a corporation" concept is an exercise in illogic and utter fail.
posted by Thorzdad at 6:11 AM on February 25, 2011 [1 favorite]
This little point, of course, is exactly why the whole "run the country like a corporation" concept is an exercise in illogic and utter fail.
So that, in turn, means we can completely ignore our balance sheets indefinitely?
posted by valkyryn at 6:13 AM on February 25, 2011
So that, in turn, means we can completely ignore our balance sheets indefinitely?
posted by valkyryn at 6:13 AM on February 25, 2011
Can we drop the ideological blinders for once?
Well, it isn't a business: noting that is hardly a demonstration of 'ideological blinders.' If I were to say, "What if the Christianity were run like a Cable Television Channel?" and linked to a 200 page report on how the Church needs to rebrand, drop loser programs like Numbers, replace Paul with a hipper, younger more open-minded character, and retcon Yahweh into a giver-of-gifts rather than a smiter-of-sinners, I think you'd be justified in saying the same thing.
There are important things we can learn from the report, to be sure, but framing it in this sort of "What if?" does leave it rather open for criticism on the premise level. Christianity is not SyFy. Government is not a for-profit corporation. Shoes are not hats.
posted by verb at 6:16 AM on February 25, 2011 [31 favorites]
Well, it isn't a business: noting that is hardly a demonstration of 'ideological blinders.' If I were to say, "What if the Christianity were run like a Cable Television Channel?" and linked to a 200 page report on how the Church needs to rebrand, drop loser programs like Numbers, replace Paul with a hipper, younger more open-minded character, and retcon Yahweh into a giver-of-gifts rather than a smiter-of-sinners, I think you'd be justified in saying the same thing.
There are important things we can learn from the report, to be sure, but framing it in this sort of "What if?" does leave it rather open for criticism on the premise level. Christianity is not SyFy. Government is not a for-profit corporation. Shoes are not hats.
posted by verb at 6:16 AM on February 25, 2011 [31 favorites]
Imagine for a moment that the United States government is a banana. Imagine that its ripeness, its peel, and size are all up for review. Now imagine that you are hungry for a banana.
posted by molecicco at 6:18 AM on February 25, 2011 [11 favorites]
posted by molecicco at 6:18 AM on February 25, 2011 [11 favorites]
"Wall Street analysts" don't have a great track record. Why would anyone take them seriously any more?
Great question. Why should we take advice about capitalism from the same people we keep bailing out?
posted by Blazecock Pileon at 6:22 AM on February 25, 2011 [11 favorites]
Great question. Why should we take advice about capitalism from the same people we keep bailing out?
posted by Blazecock Pileon at 6:22 AM on February 25, 2011 [11 favorites]
How about if we just postulate that, in reality, there is no way for any individual or group to even begin to understand the nuances, trends, possibilities, factors, and the direction the wind is gonna blow tomorrow as regards the global economy enough to even begin to chart a path with a goal 10 or 20 or 50 years out.
You know who's going to win??? Darwin.
posted by tomswift at 6:25 AM on February 25, 2011
You know who's going to win??? Darwin.
posted by tomswift at 6:25 AM on February 25, 2011
"Wall Street analysts" don't have a great track record. Why would anyone take them seriously any more?
Because to a large chunk of the population 'capitalism' is a religion and "Wall Street" is the Vatican. Most people don't understand finance; there is no one else for them to look to. The "Vatican" has a lot of fancy hats and hand waving and serious words and nice ties and really good haircuts and the "Cardinals" live in the Hamptons and such so they are infallible and my analogy is falling apart but you get the point.
posted by spicynuts at 6:26 AM on February 25, 2011 [2 favorites]
Why shouldn't it be?
I'm not saying it should not be, but having dealt with venture capital firms and public relations firms during the dot com bubble I tend to take what they have to say with a bag of salt; I am weary that they can have much independence of mind in shaping public policy or evaluating fiscal problems. My only point here is perhaps including other sources might have helped make the case; or at least a heads-up about the source (a venture capital firm, not an independent public policy research group)?
the most detailed, complete analysis of the federal government's long-term fiscal situation I've see in quite some time.
Well I'm impressed you've digested all 200 pages so quickly, but the fact that it is 200 pages (a point you refer to) is not in and of itself meaningful; corporate reports of this length are being produced in corporate offices everyday.
depressingly unsurprising with this crowd
Claiming you want an honest discussion while condescending to those you want an honest discussion from may not be the best way to go about it.
Can we drop the ideological blinders for once?
The main ideological blinders I find in America right now are from the right, and not the left. For instance, in Wisconsin there is a Governor who is is attempting to steamroll some of the most ideologically misguided aggressively anti-union legislation of recent memory; and he is doing so at the bidding of far-right billionaires.
posted by The Emperor of Ice Cream at 6:28 AM on February 25, 2011 [13 favorites]
I'm not saying it should not be, but having dealt with venture capital firms and public relations firms during the dot com bubble I tend to take what they have to say with a bag of salt; I am weary that they can have much independence of mind in shaping public policy or evaluating fiscal problems. My only point here is perhaps including other sources might have helped make the case; or at least a heads-up about the source (a venture capital firm, not an independent public policy research group)?
the most detailed, complete analysis of the federal government's long-term fiscal situation I've see in quite some time.
Well I'm impressed you've digested all 200 pages so quickly, but the fact that it is 200 pages (a point you refer to) is not in and of itself meaningful; corporate reports of this length are being produced in corporate offices everyday.
depressingly unsurprising with this crowd
Claiming you want an honest discussion while condescending to those you want an honest discussion from may not be the best way to go about it.
Can we drop the ideological blinders for once?
The main ideological blinders I find in America right now are from the right, and not the left. For instance, in Wisconsin there is a Governor who is is attempting to steamroll some of the most ideologically misguided aggressively anti-union legislation of recent memory; and he is doing so at the bidding of far-right billionaires.
posted by The Emperor of Ice Cream at 6:28 AM on February 25, 2011 [13 favorites]
Saying "The government isn't a business!" in response to a report like this amounts to sticking your fingers in your ears and going "La la la, I can't hear you!"
People are saying it's not a business, because it isn't a business.
Name a business that can (a) print its own currency (b) raise revenue at will and (c) has no defined goals other than the continued stability of 350 million largely unrelated people?
posted by T.D. Strange at 6:28 AM on February 25, 2011 [7 favorites]
People are saying it's not a business, because it isn't a business.
Name a business that can (a) print its own currency (b) raise revenue at will and (c) has no defined goals other than the continued stability of 350 million largely unrelated people?
posted by T.D. Strange at 6:28 AM on February 25, 2011 [7 favorites]
But no one seems interested in actually talking about it.
How are we supposed to talk about a 200 page document given only an hour and half to read? Come back in a day when everyone's had a chance to digest (I can't say that with a straight face. I tried).
posted by spicynuts at 6:30 AM on February 25, 2011 [3 favorites]
Could I invest my money in an Arby's franchise instead?
Oh dammit, Johnny, you know I love my big beef and cheddar!
posted by Naberius at 6:30 AM on February 25, 2011
Oh dammit, Johnny, you know I love my big beef and cheddar!
posted by Naberius at 6:30 AM on February 25, 2011
Also...by the way..it's EAT YOUR CAKE AND HAVE IT TOO, god dammit.
posted by spicynuts at 6:32 AM on February 25, 2011 [2 favorites]
posted by spicynuts at 6:32 AM on February 25, 2011 [2 favorites]
Equities research analyst Mazola downgraded shares of USA Corp (NYSE: USA) from a “underperferom” rating to a “sweetjesuschristgetoutnow” rating in a research note to investors on Thursday.
Mazola noted, the public service and private enterprise are two separate things goddammit so stop treating them like they're the same thing!
posted by mazola at 6:33 AM on February 25, 2011
Mazola noted, the public service and private enterprise are two separate things goddammit so stop treating them like they're the same thing!
posted by mazola at 6:33 AM on February 25, 2011
The fundamental moral tragedy of industrial modernity: 'Men have been mistaken for machines.'
posted by pwally at 6:34 AM on February 25, 2011 [3 favorites]
posted by pwally at 6:34 AM on February 25, 2011 [3 favorites]
Wall Street analysts look at the financial health of the United States as if the country were a private business.
Pure rich-people's propaganda. Raise their taxes already!
posted by Ironmouth at 6:36 AM on February 25, 2011 [4 favorites]
Pure rich-people's propaganda. Raise their taxes already!
posted by Ironmouth at 6:36 AM on February 25, 2011 [4 favorites]
Why Austerity is Bullshit
I didn't find this very convincing outside its title.
I think a lot of what's wrong with WAisBS and this post's article is the presumption that just because value can be created by economic transactions, that it cannot be created by other types of transactions.
FWIW, Shirky has a TED about how commoditizing a transaction breaks the underlying dynamic.
We need to learn to do the opposite.
posted by Reasonably Everything Happens at 6:41 AM on February 25, 2011
I didn't find this very convincing outside its title.
I think a lot of what's wrong with WAisBS and this post's article is the presumption that just because value can be created by economic transactions, that it cannot be created by other types of transactions.
FWIW, Shirky has a TED about how commoditizing a transaction breaks the underlying dynamic.
We need to learn to do the opposite.
posted by Reasonably Everything Happens at 6:41 AM on February 25, 2011
I'm looking to diversify my portfolio.
posted by LordSludge at 6:41 AM on February 25, 2011 [1 favorite]
posted by LordSludge at 6:41 AM on February 25, 2011 [1 favorite]
Saying "The government isn't a business!" in response to a report like this amounts to sticking your fingers in your ears and going "La la la, I can't hear you!"
if they want my attention for hundreds of pages, they can start with a premise that isn't false
But no one seems interested in actually talking about it.
where have you been? - the subject of our government's balance sheet has been talked about a lot here, thoroughly and deeply
a false framing of the problem adds nothing of worth to that discussion
posted by pyramid termite at 6:42 AM on February 25, 2011 [5 favorites]
if they want my attention for hundreds of pages, they can start with a premise that isn't false
But no one seems interested in actually talking about it.
where have you been? - the subject of our government's balance sheet has been talked about a lot here, thoroughly and deeply
a false framing of the problem adds nothing of worth to that discussion
posted by pyramid termite at 6:42 AM on February 25, 2011 [5 favorites]
Well, the security division is way too big, and I wish the CEO would stop sending its troops to attack and occupy other companies.
posted by A dead Quaker at 6:43 AM on February 25, 2011 [17 favorites]
posted by A dead Quaker at 6:43 AM on February 25, 2011 [17 favorites]
I wish the CEO would stop sending its troops to attack and occupy other companies.
The CEO has noted your concern, and is lighting his big fat cigar with your letter.
Signed,
Hall I. Burton
posted by The Emperor of Ice Cream at 6:45 AM on February 25, 2011 [9 favorites]
The CEO has noted your concern, and is lighting his big fat cigar with your letter.
Signed,
Hall I. Burton
posted by The Emperor of Ice Cream at 6:45 AM on February 25, 2011 [9 favorites]
Wall Street analysts look at the financial health of the United States as if the country were a private business.
If you think about "USA Inc." as a weapons exporter, then business is GREAT.
If you think about "USA Inc." as a weapons exporter, then business is GREAT.
The Department of Defense last year told Congress of plans to sell up to $103 billion in weapons to overseas buyers, a staggering rise from an average of $13 billion a year between 1995 and 2005, according to Deutsche Bank analyst Myles Walton. Signed agreements have tripled since 2000.posted by Fuzzy Monster at 6:47 AM on February 25, 2011
As defense giants like Boeing, Raytheon (RTN, Fortune 500), and Lockheed Martin (LMT, Fortune 500) increasingly seek to peddle their wares to well-financed (sometimes by the U.S.) international customers, they have a surprising ally: the President. "Obama is much more favorably disposed to arms exports than any of the previous Democratic administrations," says Loren Thompson, a veteran defense consultant. Or, as Jeff Abramson, deputy director of the Arms Control Association, puts it: "There's an Obama arms bazaar going on."
What condiments would go on the government if the government was a ham sandwich?
posted by Threeway Handshake at 6:51 AM on February 25, 2011
posted by Threeway Handshake at 6:51 AM on February 25, 2011
What condiments would go on the government if the government was a ham sandwich?
What goes good on pork?
posted by mazola at 6:54 AM on February 25, 2011 [3 favorites]
What goes good on pork?
posted by mazola at 6:54 AM on February 25, 2011 [3 favorites]
If the USA is a company, what is its product?
posted by DreamerFi at 6:58 AM on February 25, 2011 [2 favorites]
posted by DreamerFi at 6:58 AM on February 25, 2011 [2 favorites]
So when you have a lot of the same crowd of people saying that the government should be run like a business and at the same time taking it as currency that taxation is theft, why should I not believe that, since the latter premise basically invalidates our modern form of government entirely, their goal is anything other than shutting the whole thing down?
We've been defunding agencies for years, so now that we're in a crisis, it's time to shut them down because they perform poorly. Then the next crisis comes along and the next set of agencies gets their funding cut. Repeat.
Pretty soon we're going to end up with a prison system and a state security apparatus and nothing else.
posted by feloniousmonk at 7:00 AM on February 25, 2011 [12 favorites]
We've been defunding agencies for years, so now that we're in a crisis, it's time to shut them down because they perform poorly. Then the next crisis comes along and the next set of agencies gets their funding cut. Repeat.
Pretty soon we're going to end up with a prison system and a state security apparatus and nothing else.
posted by feloniousmonk at 7:00 AM on February 25, 2011 [12 favorites]
If the USA is a company, what is its product?
You.
posted by swift at 7:01 AM on February 25, 2011 [2 favorites]
You.
posted by swift at 7:01 AM on February 25, 2011 [2 favorites]
A friend is an economist for The Economist in London and we often get into debates about the state of the US, as we are both Americans. She often throws up her hands in exasperation and wonders why they haven't taken my passport away. We both love our country, we just see two very different countries.
To address the comments about treating the US as a business, that's not really the point, whether or not the analysis style is the best possible. Rather, Americans need to start really thinking about what is going on in the country.
The most interesting graph may be the US contribution to world GDP and its decrease over the last few decades in favour of China et al. The stark reality is that we can no longer eat our cake and have it too. We must start looking at the practicalities of our economy and put together an economy that makes more sense.
Do we want to project military power to each corner of the globe OR do we want to take care of people's health as they age?
Do we want to invest in infrastructure and the precursors to economic activity OR do we want to continue treating lifestyle disorders?
These are hard choices and choices that we have to make together but sadly we're so divided along practical and ideological lines. Rich vs. poor. Urban vs. rural. Men vs. Women. Young vs. Old. Red vs. Blue.
I fear instead of coming up with a collective solution, we are starting to eat each other. Thankfully we are tasty due to the high fat content of our lifestyles. But eat each other nonetheless. Nobody wants to accept that there may be less in the future. Not the rich, not the Medicare'd, not the old, not the young. So everyone is trying to grab and hold what they have.
It's a very game theory argument. We can either figure out how to accept less and do that together for the best outcome or we can fight and destroy value and waste time until a solution is imposed on us by external markets.
I came to Europe to learn more about how the systems work over here. They're not perfect for sure but there is a great sense of collectivism as there's a sh*t tonne of people that all have to live together. Problems aren't "out there", they're "here". It's fascinating. I just hope that the United States doesn't have to go through serious wars with itself to arrive at a place of acceptance.
posted by nickrussell at 7:01 AM on February 25, 2011 [9 favorites]
To address the comments about treating the US as a business, that's not really the point, whether or not the analysis style is the best possible. Rather, Americans need to start really thinking about what is going on in the country.
The most interesting graph may be the US contribution to world GDP and its decrease over the last few decades in favour of China et al. The stark reality is that we can no longer eat our cake and have it too. We must start looking at the practicalities of our economy and put together an economy that makes more sense.
Do we want to project military power to each corner of the globe OR do we want to take care of people's health as they age?
Do we want to invest in infrastructure and the precursors to economic activity OR do we want to continue treating lifestyle disorders?
These are hard choices and choices that we have to make together but sadly we're so divided along practical and ideological lines. Rich vs. poor. Urban vs. rural. Men vs. Women. Young vs. Old. Red vs. Blue.
I fear instead of coming up with a collective solution, we are starting to eat each other. Thankfully we are tasty due to the high fat content of our lifestyles. But eat each other nonetheless. Nobody wants to accept that there may be less in the future. Not the rich, not the Medicare'd, not the old, not the young. So everyone is trying to grab and hold what they have.
It's a very game theory argument. We can either figure out how to accept less and do that together for the best outcome or we can fight and destroy value and waste time until a solution is imposed on us by external markets.
I came to Europe to learn more about how the systems work over here. They're not perfect for sure but there is a great sense of collectivism as there's a sh*t tonne of people that all have to live together. Problems aren't "out there", they're "here". It's fascinating. I just hope that the United States doesn't have to go through serious wars with itself to arrive at a place of acceptance.
posted by nickrussell at 7:01 AM on February 25, 2011 [9 favorites]
feloniousmonk: "
Pretty soon we're going to end up with a prison system and a state security apparatus and nothing else"
Google Grover Norquist.
posted by notsnot at 7:01 AM on February 25, 2011 [1 favorite]
Pretty soon we're going to end up with a prison system and a state security apparatus and nothing else"
Google Grover Norquist.
posted by notsnot at 7:01 AM on February 25, 2011 [1 favorite]
Saying "The government isn't a business!" in response to a report like this amounts to sticking your fingers in your ears and going "La la la, I can't hear you!"
Um...no. Saying "The government isn't a business!" in response to a report like this amounts to calling a spade and spade. You can't apply corporate motivations (providing elective goods and services to a consumer population for PROFIT) to a government which provides needed services to the general population for no profit.
posted by Thorzdad at 7:01 AM on February 25, 2011 [2 favorites]
Um...no. Saying "The government isn't a business!" in response to a report like this amounts to calling a spade and spade. You can't apply corporate motivations (providing elective goods and services to a consumer population for PROFIT) to a government which provides needed services to the general population for no profit.
posted by Thorzdad at 7:01 AM on February 25, 2011 [2 favorites]
So that, in turn, means we can completely ignore our balance sheets indefinitely?
Valkyryn - the flawed premise behind a statement like that is that a government is not a company. That implies many many things - not the least of which are massive legal powers to compel taxation and other revenues, the ability to debase the currency, and most importantly there is never "an ongoing concern" discussion - which is what would be the point behind many many of the reasons why the accounting rules for business are fundamentally different than they are for public finances.
Looking at a government balance sheet through GAAP is just wrong. GAAP was not ever intended for uses like this.
Now this is not to wave away some of the issues you bring up at all. Certainly they are problematic, but much much much less problematic then this analysis would claim.
Also someone has gotta see the irony in Mary Meeker analyzing balance sheets
posted by JPD at 7:02 AM on February 25, 2011 [1 favorite]
Valkyryn - the flawed premise behind a statement like that is that a government is not a company. That implies many many things - not the least of which are massive legal powers to compel taxation and other revenues, the ability to debase the currency, and most importantly there is never "an ongoing concern" discussion - which is what would be the point behind many many of the reasons why the accounting rules for business are fundamentally different than they are for public finances.
Looking at a government balance sheet through GAAP is just wrong. GAAP was not ever intended for uses like this.
Now this is not to wave away some of the issues you bring up at all. Certainly they are problematic, but much much much less problematic then this analysis would claim.
Also someone has gotta see the irony in Mary Meeker analyzing balance sheets
posted by JPD at 7:02 AM on February 25, 2011 [1 favorite]
(Un)fortunately I don't need to.
posted by feloniousmonk at 7:02 AM on February 25, 2011
posted by feloniousmonk at 7:02 AM on February 25, 2011
I mean seriously you all realize that Mary Meeker was famously very bad at this job right? Not like bad "called bad stocks" or "put buy ratings on things that were worthless" like bad as in known for lacking the basic mechanical skills of financial statement analysis.
posted by JPD at 7:08 AM on February 25, 2011 [3 favorites]
posted by JPD at 7:08 AM on February 25, 2011 [3 favorites]
Serious question to the people defending this article's premise:
Why should we take advice about capitalism, balance sheets, entitlement programs, etc. from the same people we keep bailing out, who believe they are entitled to bailouts, who do not want to pay taxes to cover the revenue needed to keep USA Inc. running?
What constructive advice can these individuals provide, which doesn't involve dismantling police, fire and emergency services, doesn't involve firing school teachers, doesn't involve taking away protections on clean water and air, doesn't involve dismantling social insurance, as well as all the other goods and services that USA Inc. provides?
This is a serious question. It's probably the most serious of questions facing this country, as the useful bits and pieces of our stable society get dismantled and sold off. I'd really like to hear answers from the other side.
posted by Blazecock Pileon at 7:09 AM on February 25, 2011 [7 favorites]
Why should we take advice about capitalism, balance sheets, entitlement programs, etc. from the same people we keep bailing out, who believe they are entitled to bailouts, who do not want to pay taxes to cover the revenue needed to keep USA Inc. running?
What constructive advice can these individuals provide, which doesn't involve dismantling police, fire and emergency services, doesn't involve firing school teachers, doesn't involve taking away protections on clean water and air, doesn't involve dismantling social insurance, as well as all the other goods and services that USA Inc. provides?
This is a serious question. It's probably the most serious of questions facing this country, as the useful bits and pieces of our stable society get dismantled and sold off. I'd really like to hear answers from the other side.
posted by Blazecock Pileon at 7:09 AM on February 25, 2011 [7 favorites]
doesn't involve firing school teachers
Speaking of firing teachers....
posted by hippybear at 7:13 AM on February 25, 2011 [1 favorite]
Speaking of firing teachers....
posted by hippybear at 7:13 AM on February 25, 2011 [1 favorite]
I'm no finance expert, but as I recall, USA, Inc. was doing really well about twelve years or so ago. High market cap, poised to pay out large dividends to the investors...then there was that controversial change in the senior management, followed by those expensive hostile buyouts of IraqCo and Afghanistan LLC. Instead of gaining market share, they lost it, and (if I recall correctly) that's when the balance sheet went into the red. And then the CFO and his senior staff totally screwed up the books somehow (again, I'm no finance expert)...they caught those bookkeepers that fled to Tahiti, but I don't know if that made a difference.
I think if they would at least stop pushing the buyouts and made some attempts to replace the CFO, the company could start to make a turnaround. Because I'm not confident about the current plan of forcing the stockholders to turn their certificates over to senior management for them to sell and reinvest.
Or we could, you know, drop the stupid "USA Inc." crap and talk about GOVERNING the country, in the service of the people, now and in the future.
posted by PlusDistance at 7:14 AM on February 25, 2011 [9 favorites]
I think if they would at least stop pushing the buyouts and made some attempts to replace the CFO, the company could start to make a turnaround. Because I'm not confident about the current plan of forcing the stockholders to turn their certificates over to senior management for them to sell and reinvest.
Or we could, you know, drop the stupid "USA Inc." crap and talk about GOVERNING the country, in the service of the people, now and in the future.
posted by PlusDistance at 7:14 AM on February 25, 2011 [9 favorites]
Do we want to project military power to each corner of the globe OR do we want to take care of people's health as they age? Do we want to invest in infrastructure and the precursors to economic activity OR do we want to continue treating lifestyle disorders? These are hard choices and choices that we have to make together but sadly we're so divided along practical and ideological lines. Rich vs. poor. Urban vs. rural. Men vs. Women. Young vs. Old. Red vs. Blue.
But these are not even choices, b/c we, as in we the people, are not the ones with the power to make the decisions you are talking about: our form of representative government has been, in most cases that matter, effectively hijacked by power brokers and corporate interests. This by now familiar plutocratic capture is obscured by the very divisions you cite: those divisions are played upon like a violin by the right wing punditry, which has trained its minions to act against their own interests and look down the ladder rather than up. A center-right position in Europe or Canada is sometimes (as in health care) considered a hard-left position here, b/c America has been steadily drifting to the right for decades. It may be however that the right is now pushing so hard for its end-game war on the middle class that there will be a backlash.
posted by The Emperor of Ice Cream at 7:15 AM on February 25, 2011 [2 favorites]
But these are not even choices, b/c we, as in we the people, are not the ones with the power to make the decisions you are talking about: our form of representative government has been, in most cases that matter, effectively hijacked by power brokers and corporate interests. This by now familiar plutocratic capture is obscured by the very divisions you cite: those divisions are played upon like a violin by the right wing punditry, which has trained its minions to act against their own interests and look down the ladder rather than up. A center-right position in Europe or Canada is sometimes (as in health care) considered a hard-left position here, b/c America has been steadily drifting to the right for decades. It may be however that the right is now pushing so hard for its end-game war on the middle class that there will be a backlash.
posted by The Emperor of Ice Cream at 7:15 AM on February 25, 2011 [2 favorites]
It's not just the "shareholders" we need to worry about spooking, it's the bond holders. We can continue borrowing just as long as our lenders believe they'll be paid back, with interest, in a currency that hasn't inflated away their gains in the meantime.
But that means we get to avoid balancing the budget only until we're past the point where we can't balance the budget. "I can buy this long-term-overvalued investment but still make money by selling it to a bigger sucker in the short term" works for everything from tulip bulbs to pets.com stock to houses, but it only works until people start to worry that they might be the biggest sucker.
posted by roystgnr at 7:18 AM on February 25, 2011
But that means we get to avoid balancing the budget only until we're past the point where we can't balance the budget. "I can buy this long-term-overvalued investment but still make money by selling it to a bigger sucker in the short term" works for everything from tulip bulbs to pets.com stock to houses, but it only works until people start to worry that they might be the biggest sucker.
posted by roystgnr at 7:18 AM on February 25, 2011
They wind up putting most of the blame on Medicare (especially Part D) and Medicaid.
Valkyryn - its funny you say this. So this went around our office yesterdayAll of my peers are sort of reasonable conservatives - social libertarians, pro-immigration, pro-choice, pro-environment, small government types. WASP-y northeasterners as it were. All of us agree healthcare costs are our biggest issue going forward. The math of 8%-9% heathcare inflation is not tenable. We ideologically have different solutions, but at least we agree on the cause. (I'm generally referred to as the office 'Limousine Liberal')
To a person we read this and said "they must have some healthcare businesses they are trying to monetize"
BP- As a finance person who generally thinks finance people aren't any smarter then their peers who have chosen to do other things- I would tell you they have two things politicans and the media love - money obviously, and swagger. Can't tell you how many b students from ivy league schools honestly think they are the smartest guys in the room. Its amazing, and people generally buy that shit. I see it all the time.
posted by JPD at 7:19 AM on February 25, 2011 [1 favorite]
Valkyryn - its funny you say this. So this went around our office yesterdayAll of my peers are sort of reasonable conservatives - social libertarians, pro-immigration, pro-choice, pro-environment, small government types. WASP-y northeasterners as it were. All of us agree healthcare costs are our biggest issue going forward. The math of 8%-9% heathcare inflation is not tenable. We ideologically have different solutions, but at least we agree on the cause. (I'm generally referred to as the office 'Limousine Liberal')
To a person we read this and said "they must have some healthcare businesses they are trying to monetize"
BP- As a finance person who generally thinks finance people aren't any smarter then their peers who have chosen to do other things- I would tell you they have two things politicans and the media love - money obviously, and swagger. Can't tell you how many b students from ivy league schools honestly think they are the smartest guys in the room. Its amazing, and people generally buy that shit. I see it all the time.
posted by JPD at 7:19 AM on February 25, 2011 [1 favorite]
Paul Krugman has a good (short!) piece on "Why a Country is not a company" that somewhat systematises and extends the criticism of the comparision that people have been making here.
posted by Philosopher's Beard at 7:34 AM on February 25, 2011 [1 favorite]
posted by Philosopher's Beard at 7:34 AM on February 25, 2011 [1 favorite]
If the USA is a company, what is its product?
You.
*checks location entered in profile information*
*wanders away confused*
posted by DreamerFi at 7:39 AM on February 25, 2011 [1 favorite]
You.
*checks location entered in profile information*
*wanders away confused*
posted by DreamerFi at 7:39 AM on February 25, 2011 [1 favorite]
Why shouldn't it be?
Because any reasonable person would expect a PR piece from anyone to be filled with, at best, half-truths that work in the interests of the organization whose PR it is, and some serious number of lies by omission, and probably at least a few outright fabrications.
Given the large-scale and seemingly endemic malfeasance and dishonesty tearing through the financial sector nowadays, this would only go double for PR from a venture capital firm.
*shrug* It could all be 100% correct and exactly the right prescription. In the same way that snake-oil salesmen also probably sold, by pure accident, the occasional effective product.
Ad hominem is bad when it's about something unrelated. "Why should I believe you about the economy when I saw you masturbating to My Little Pony once?" -- bad. But it's less clearly bad when the claim is closer to "Why should I believe what you say about the economy because I think you are likely to be lying to me about it in defense of your own interests?"
posted by ROU_Xenophobe at 7:49 AM on February 25, 2011 [3 favorites]
Because any reasonable person would expect a PR piece from anyone to be filled with, at best, half-truths that work in the interests of the organization whose PR it is, and some serious number of lies by omission, and probably at least a few outright fabrications.
Given the large-scale and seemingly endemic malfeasance and dishonesty tearing through the financial sector nowadays, this would only go double for PR from a venture capital firm.
*shrug* It could all be 100% correct and exactly the right prescription. In the same way that snake-oil salesmen also probably sold, by pure accident, the occasional effective product.
Ad hominem is bad when it's about something unrelated. "Why should I believe you about the economy when I saw you masturbating to My Little Pony once?" -- bad. But it's less clearly bad when the claim is closer to "Why should I believe what you say about the economy because I think you are likely to be lying to me about it in defense of your own interests?"
posted by ROU_Xenophobe at 7:49 AM on February 25, 2011 [3 favorites]
It's a bit of a quirk that the folks who want to "run the country as a business" also don't want to spend money on capital investments that would any normal company would require.
Besides which, if the country is being run for-profit, who takes those profits? The "shareholders", i.e. the general population? If it's a non-profit, then the money should go back into the "company". Either way, that money would be going towards things like infrastructure and R&D.
So, yes - run the country like a company. Maybe then we can get some decent high speed rail and this generation's Apollo Program.
posted by backseatpilot at 7:53 AM on February 25, 2011 [6 favorites]
Besides which, if the country is being run for-profit, who takes those profits? The "shareholders", i.e. the general population? If it's a non-profit, then the money should go back into the "company". Either way, that money would be going towards things like infrastructure and R&D.
So, yes - run the country like a company. Maybe then we can get some decent high speed rail and this generation's Apollo Program.
posted by backseatpilot at 7:53 AM on February 25, 2011 [6 favorites]
So... cut costs by firing half the employees (rather than by developing something of value), give yourself a bonus with the money, wait for the company [government] to suffer due to understaffing, get fired by the board, retired with enormous golden parachute?
OK. Where do I sign up?
posted by Eideteker at 8:19 AM on February 25, 2011
OK. Where do I sign up?
posted by Eideteker at 8:19 AM on February 25, 2011
What constructive advice can these individuals provide, which doesn't involve... etc.
If any and all benefit cuts are off the table, as you seem to indicate they are, then probably nothing. But if that's a position from which you are unwilling to move--and the numbers don't seem to bother you--I'm not really sure there's really a discussion to be had here. We're going to have to raise taxes and cut benefits, as both are currently at unsustainable levels.
And I really don't understand the fundamental objections to applying any business principles here. Even if I were to admit that Krugman's analysis is entirely correct, it doesn't have anything to do with the argument that no entity, governmental or private, can spend more than it brings in for an arbitrary amount of time. Of course governments spend money on things that no sane business person would choose if the motive were profit. That is undeniably the whole point, not any kind of profit motive. But sovereign debt crises are real things which sometimes go very badly. We find some way of curtailing our spending and increasing our revenue, and while cutting defense spending and increasing taxes on corporations and the top 1% may be necessary, there is no evidence to suggest that it will be anywhere near sufficient over any significant period of time.
posted by valkyryn at 8:21 AM on February 25, 2011
If any and all benefit cuts are off the table, as you seem to indicate they are, then probably nothing. But if that's a position from which you are unwilling to move--and the numbers don't seem to bother you--I'm not really sure there's really a discussion to be had here. We're going to have to raise taxes and cut benefits, as both are currently at unsustainable levels.
And I really don't understand the fundamental objections to applying any business principles here. Even if I were to admit that Krugman's analysis is entirely correct, it doesn't have anything to do with the argument that no entity, governmental or private, can spend more than it brings in for an arbitrary amount of time. Of course governments spend money on things that no sane business person would choose if the motive were profit. That is undeniably the whole point, not any kind of profit motive. But sovereign debt crises are real things which sometimes go very badly. We find some way of curtailing our spending and increasing our revenue, and while cutting defense spending and increasing taxes on corporations and the top 1% may be necessary, there is no evidence to suggest that it will be anywhere near sufficient over any significant period of time.
posted by valkyryn at 8:21 AM on February 25, 2011
Wall Street analysts look at the financial health of the United States as if the country were a private business.
We're going for a boutique type of business model.
posted by Trochanter at 8:25 AM on February 25, 2011
We're going for a boutique type of business model.
posted by Trochanter at 8:25 AM on February 25, 2011
If the US is going to be run like a business then I think the first thing we need to do is get rid of some of our less profitable divisions (and by "divisions" I mean "states"). Mississippi, Utah, South Carolina, Idaho - your GSP per capita is crap. Sorry, we are going to have to let you go.
Now then. We've known for some time that not all of our citizens have been pulling their weight. I think we are going to have to get rid of some of you. No, I'm sorry, it's decided. We'll give you a nice 90 day severance package (pretty generous, I think you'll agree) and a letter of recommendation so that you can find a new employer (country. Whatever). However, you'll have to leave the country now.
Okay, next item on the agenda. The rumors of a hostile takeover of USA Inc. by China LLC are just rumors.
posted by It's Never Lurgi at 8:28 AM on February 25, 2011 [6 favorites]
Now then. We've known for some time that not all of our citizens have been pulling their weight. I think we are going to have to get rid of some of you. No, I'm sorry, it's decided. We'll give you a nice 90 day severance package (pretty generous, I think you'll agree) and a letter of recommendation so that you can find a new employer (country. Whatever). However, you'll have to leave the country now.
Okay, next item on the agenda. The rumors of a hostile takeover of USA Inc. by China LLC are just rumors.
posted by It's Never Lurgi at 8:28 AM on February 25, 2011 [6 favorites]
Even if I were to admit that Krugman's analysis is entirely correct, it doesn't have anything to do with the argument that no entity, governmental or private, can spend more than it brings in for an arbitrary amount of time.
Of course you can. As long as your income rises in such a way that the interest on your debt remains a manageable percentage of your income then you can do exactly that.
posted by It's Never Lurgi at 8:30 AM on February 25, 2011 [1 favorite]
Of course you can. As long as your income rises in such a way that the interest on your debt remains a manageable percentage of your income then you can do exactly that.
posted by It's Never Lurgi at 8:30 AM on February 25, 2011 [1 favorite]
What if America was your junkie brother who would do anything for another hit of heroin, homeless and stumbling through the park, collapsing in abandoned buildings, willing to do anything for another hit. Imagine his friends and family have deserted him because he would steal from anyone to get another hit. He's sitting in a park in Washington DC drinking mouthwash after throwing his life away and running up massive debt. What would you do if America was your junkie brother? Some people would say "AMERICA IS STILL THE BEST BROTHER IN THE WORLD"
posted by fuq at 8:56 AM on February 25, 2011
posted by fuq at 8:56 AM on February 25, 2011
When was the last sovereign default involving debt issued in a nations own currency? The last resort is never default, it is devaluation.
Also Valkyryn please please please tell me you see the irony in using the French Revolution as an example of what happens when a country's finances are distressed?
posted by JPD at 8:56 AM on February 25, 2011
Also Valkyryn please please please tell me you see the irony in using the French Revolution as an example of what happens when a country's finances are distressed?
posted by JPD at 8:56 AM on February 25, 2011
If the US is a business, then its "product" is US citizenship. It's a very desirable product. One which, in fact, the US has a complete and total monopoly.
I'd propose a tiered pricing model in which those who have more to spend pay a higher price for this product. By simply raising some of these upper tier prices, the US could completely eliminate its operating deficit.
Sure, some of the customers are going to complain. But given the prices are still lower than most of the competitors, are they really going to switch products?
posted by bitterpants at 9:05 AM on February 25, 2011 [4 favorites]
I'd propose a tiered pricing model in which those who have more to spend pay a higher price for this product. By simply raising some of these upper tier prices, the US could completely eliminate its operating deficit.
Sure, some of the customers are going to complain. But given the prices are still lower than most of the competitors, are they really going to switch products?
posted by bitterpants at 9:05 AM on February 25, 2011 [4 favorites]
To address the comments about treating the US as a business, that's not really the point,
This seems disingenuous; why else link to the piece you linked to? You can't frame the fpp in a particular way from the ground up and then be surprised when people comment from within that framework.
posted by rtha at 9:19 AM on February 25, 2011
This seems disingenuous; why else link to the piece you linked to? You can't frame the fpp in a particular way from the ground up and then be surprised when people comment from within that framework.
posted by rtha at 9:19 AM on February 25, 2011
If any and all benefit cuts are off the table, as you seem to indicate they are, then probably nothing
Looking at the question from the other direction, why should benefit cuts be done to basic services like those specific ones I mentioned, in order to divert those benefits to private capital (investment banks, S+Ls, housing, global hedge funds, car companies, etc.)?
I'm interested to learn why failed capitalists see basic services as expendable and taxes as optional, when police officers, firefighters, EMTs, teachers, clean water and air, etc. provide for the functioning of a stable society that allows capitalists to do their business in the first place?
posted by Blazecock Pileon at 9:26 AM on February 25, 2011 [4 favorites]
Looking at the question from the other direction, why should benefit cuts be done to basic services like those specific ones I mentioned, in order to divert those benefits to private capital (investment banks, S+Ls, housing, global hedge funds, car companies, etc.)?
I'm interested to learn why failed capitalists see basic services as expendable and taxes as optional, when police officers, firefighters, EMTs, teachers, clean water and air, etc. provide for the functioning of a stable society that allows capitalists to do their business in the first place?
posted by Blazecock Pileon at 9:26 AM on February 25, 2011 [4 favorites]
This entire budget crisis and deficit panic is part of a calculated political strategy meant to roll back social programs conservatives don't like and to hurt the Dems political chances come the election, as I've been warning for some time now. Republican's have always used their phoney-baloney deficit panic propaganda to shove through their regressive policy aims.
Meanwhile, Goldman Sachs is quietly warning the "Good Germans" of Wall Street that the Republican budget cuts are going to cause further economic contraction and prolong the US economic recovery.
The shame of it all is that the Obama administration allowed itself to be hogtied into going along with this deficit reduction/"entitlement" panic shuck and jive at all, but to be fair, it seems like all the suckers in America lined up to hop on that train first. Even "liberal" news outlet NPR has been devoting something like 40% of its coverage to carrying the water on Republican budget slashing propaganda since well before the midterm elections.
Meanwhile, the Koch brothers aren't even trying to pretend anymore that they aren't oligarchs who feel entitled to the privilege of having policymaking custom-tailored to suit their own particular inherently unequal notions of the principle of "economic freedom."
posted by saulgoodman at 9:35 AM on February 25, 2011 [4 favorites]
Meanwhile, Goldman Sachs is quietly warning the "Good Germans" of Wall Street that the Republican budget cuts are going to cause further economic contraction and prolong the US economic recovery.
The shame of it all is that the Obama administration allowed itself to be hogtied into going along with this deficit reduction/"entitlement" panic shuck and jive at all, but to be fair, it seems like all the suckers in America lined up to hop on that train first. Even "liberal" news outlet NPR has been devoting something like 40% of its coverage to carrying the water on Republican budget slashing propaganda since well before the midterm elections.
Meanwhile, the Koch brothers aren't even trying to pretend anymore that they aren't oligarchs who feel entitled to the privilege of having policymaking custom-tailored to suit their own particular inherently unequal notions of the principle of "economic freedom."
posted by saulgoodman at 9:35 AM on February 25, 2011 [4 favorites]
Luckily, running a nation as a private corporation would be stupid. Most corps last barely a century, and usually when the founders die.
And, quite frankly, comparing the fiscal realities of a nation -- essentially the fiscal roots of our chosen society -- and either the fiscal realities of a household or a corporation is sort of a cute thought experiment that shows us exactly nothing. These things just can't be compared.
posted by clvrmnky at 9:37 AM on February 25, 2011 [1 favorite]
And, quite frankly, comparing the fiscal realities of a nation -- essentially the fiscal roots of our chosen society -- and either the fiscal realities of a household or a corporation is sort of a cute thought experiment that shows us exactly nothing. These things just can't be compared.
posted by clvrmnky at 9:37 AM on February 25, 2011 [1 favorite]
Imagine for a moment that the United States government is a public corporation.
Or, to paraphrase:
"Imagine for a moment that something that expressly isn't true actually is true because doing that might help us lead you to certain likewise untrue conclusions that we would really like you to reach because that helps us sell you this big bowl of shit we've got here."
posted by saulgoodman at 9:42 AM on February 25, 2011 [9 favorites]
Or, to paraphrase:
"Imagine for a moment that something that expressly isn't true actually is true because doing that might help us lead you to certain likewise untrue conclusions that we would really like you to reach because that helps us sell you this big bowl of shit we've got here."
posted by saulgoodman at 9:42 AM on February 25, 2011 [9 favorites]
"Imagine for a moment that something that expressly isn't true actually is true because doing that might help us lead you to certain likewise untrue conclusions that we would really like you to reach because that helps us sell you this big bowl of shit we've got here."
Hey! I know that guy! He teaches, like, ten economics courses at the Hoover Institute!
posted by Trochanter at 9:50 AM on February 25, 2011
Hey! I know that guy! He teaches, like, ten economics courses at the Hoover Institute!
posted by Trochanter at 9:50 AM on February 25, 2011
I like to think of America as a mischievous badger.
posted by TheWhiteSkull at 9:51 AM on February 25, 2011 [6 favorites]
posted by TheWhiteSkull at 9:51 AM on February 25, 2011 [6 favorites]
Another way of making Krugman's point is that economics is not business. Countries have special features that companies lack. For example, countries have sovereignty so they don't go bankrupt, they just default - and there's nothing anyone else can do about it.
Also countries operate at the systemic macro-scale where normal micro-economic profit maximisation/cost minimisation principles don't apply. Which is why governments should care whether or not workers are earning enough to afford to buy stuff while any particular business only focuses on immediate profit and could care less about whether its employees are on food stamps.
Then there is the ethical dimension of deciding what's fair and who gets to be a winner or a loser - which is why we have politics. The regulatory environment we choose, the tax system, monetary policy, etc all have different consequences for different parts of the economy and it is not obvious that policies that are recommended as good for Wall Street will be 'good for America' as a whole. For example, American manufacturers whine about Chinese competition through an underpriced Yuan, but millions of poor Americans can afford to buy more products because of China's subsidy.
posted by Philosopher's Beard at 9:53 AM on February 25, 2011 [1 favorite]
Also countries operate at the systemic macro-scale where normal micro-economic profit maximisation/cost minimisation principles don't apply. Which is why governments should care whether or not workers are earning enough to afford to buy stuff while any particular business only focuses on immediate profit and could care less about whether its employees are on food stamps.
Then there is the ethical dimension of deciding what's fair and who gets to be a winner or a loser - which is why we have politics. The regulatory environment we choose, the tax system, monetary policy, etc all have different consequences for different parts of the economy and it is not obvious that policies that are recommended as good for Wall Street will be 'good for America' as a whole. For example, American manufacturers whine about Chinese competition through an underpriced Yuan, but millions of poor Americans can afford to buy more products because of China's subsidy.
posted by Philosopher's Beard at 9:53 AM on February 25, 2011 [1 favorite]
I actually read (most of) this report, and in its 266 pages defense spending isn't even a bullet point. That's fucking ridiculous, right off the bat.
posted by eamondaly at 9:56 AM on February 25, 2011 [5 favorites]
posted by eamondaly at 9:56 AM on February 25, 2011 [5 favorites]
I'm interested to learn why failed capitalists see basic services as expendable and taxes as optional
You aren't paying attention, either to me or to the linked document. No one is suggesting that increased taxes aren't necessary.
posted by valkyryn at 10:08 AM on February 25, 2011
You aren't paying attention, either to me or to the linked document. No one is suggesting that increased taxes aren't necessary.
posted by valkyryn at 10:08 AM on February 25, 2011
"Looking at the question from the other direction, why should benefit cuts be done to basic services like those specific ones I mentioned, in order to divert those benefits to private capital (investment banks, S+Ls, housing, global hedge funds, car companies, etc.)?
I'm interested to learn why failed capitalists see basic services as expendable and taxes as optional, when police officers, firefighters, EMTs, teachers, clean water and air, etc. provide for the functioning of a stable society that allows capitalists to do their business in the first place?"
posted by Blazecock Pileon
Bang on. I sometimes wonder if this is our version of Klein's "Shock Doctrine," with one of the main goals being the reduction of the state infrastructure and corporations taking over. In the UK we have PFI and stuff contracted out to corporations all over the place, and now everything is being slashed. And people voted for this because labour ran up a huge fucking debt. They are all in it together, labour did their bit and now the tories will do theirs. A third world style shock wouldn't really work in the UK
posted by marienbad at 10:13 AM on February 25, 2011
I'm interested to learn why failed capitalists see basic services as expendable and taxes as optional, when police officers, firefighters, EMTs, teachers, clean water and air, etc. provide for the functioning of a stable society that allows capitalists to do their business in the first place?"
posted by Blazecock Pileon
Bang on. I sometimes wonder if this is our version of Klein's "Shock Doctrine," with one of the main goals being the reduction of the state infrastructure and corporations taking over. In the UK we have PFI and stuff contracted out to corporations all over the place, and now everything is being slashed. And people voted for this because labour ran up a huge fucking debt. They are all in it together, labour did their bit and now the tories will do theirs. A third world style shock wouldn't really work in the UK
posted by marienbad at 10:13 AM on February 25, 2011
You aren't paying attention, either to me or to the linked document. No one is suggesting that increased taxes aren't necessary.
Republicans are.
posted by T.D. Strange at 10:14 AM on February 25, 2011 [4 favorites]
Republicans are.
posted by T.D. Strange at 10:14 AM on February 25, 2011 [4 favorites]
I actually read (most of) this report, and in its 266 pages defense spending isn't even a bullet point.
Then you didn't read it. There's an entire section devoted to defense spending and it shows up in just about every budget overview.
posted by valkyryn at 10:15 AM on February 25, 2011 [2 favorites]
Then you didn't read it. There's an entire section devoted to defense spending and it shows up in just about every budget overview.
posted by valkyryn at 10:15 AM on February 25, 2011 [2 favorites]
eamondaly: --in its 266 pages defense spending isn't even a bullet point.
See the last bullet point in the first slide on page 26. Paul Krugman makes a similar point:
I think you're being too kind to the linked document. See the top slide on page 28, "Options for increasing revenue."
See the last bullet point in the first slide on page 26. Paul Krugman makes a similar point:
But if we’re talking about fiscal issues, you have to bear the arithmetic in mind. We’re not living in the 1950s, when defense was half the federal budget. Even a drastic cut in military spending wouldn’t release enough money to offset more than a small fraction of the projected rise in health care costs.valkyryn: No one is suggesting that increased taxes aren't necessary.
I think you're being too kind to the linked document. See the top slide on page 28, "Options for increasing revenue."
Reducing tax subsidies (like exemptions on mortgage interest or healthcare benefits) and changing the tax system in other ways could increase USA Inc.'s revenue without raising income taxes to punitive--and self-defeating--levels.posted by russilwvong at 10:16 AM on February 25, 2011 [1 favorite]
entitlement is such a funny word in american english. lets be more specific. the largest discretionary items in the budget are social security (technically funded seperated), Medicare, Medicaid, and the "Defense" budget.
Everything else is peanuts.
what valkryn is saying is that times are tough and since SS is solvent sorry folks, but grandma is going to have to be sick and die because we can't afford to pay for her care. Those kids living in that apartment, deaf from ear infections, have to let their teeth rot out, ok fine they are kids we'll cough up some cash for them, but their mom has to die from appendicitis because we just can't afford any more. sorry all, times are tough.
its funny you say this. So this went around our office yesterdayAll of my peers are sort of reasonable conservatives - social libertarians, pro-immigration, pro-choice, pro-environment, small government types. WASP-y northeasterners as it were. All of us agree healthcare costs are our biggest issue going forward. The math of 8%-9% heathcare inflation is not tenable. We ideologically have different solutions, but at least we agree on the cause. (I'm generally referred to as the office 'Limousine Liberal')
the fact that anyone isn't insane can recognize that 10% health care cost inflation is unsustainable, but the most conservative incremental attempt to reform health care costs was just barely passed and is the subject of insane vitriol/attempts to repeal is the best argument that can be made (after the Iraq War) that the political class in the US is delusional on a Louis XVI scale.
posted by ennui.bz at 10:18 AM on February 25, 2011 [3 favorites]
Everything else is peanuts.
what valkryn is saying is that times are tough and since SS is solvent sorry folks, but grandma is going to have to be sick and die because we can't afford to pay for her care. Those kids living in that apartment, deaf from ear infections, have to let their teeth rot out, ok fine they are kids we'll cough up some cash for them, but their mom has to die from appendicitis because we just can't afford any more. sorry all, times are tough.
its funny you say this. So this went around our office yesterdayAll of my peers are sort of reasonable conservatives - social libertarians, pro-immigration, pro-choice, pro-environment, small government types. WASP-y northeasterners as it were. All of us agree healthcare costs are our biggest issue going forward. The math of 8%-9% heathcare inflation is not tenable. We ideologically have different solutions, but at least we agree on the cause. (I'm generally referred to as the office 'Limousine Liberal')
the fact that anyone isn't insane can recognize that 10% health care cost inflation is unsustainable, but the most conservative incremental attempt to reform health care costs was just barely passed and is the subject of insane vitriol/attempts to repeal is the best argument that can be made (after the Iraq War) that the political class in the US is delusional on a Louis XVI scale.
posted by ennui.bz at 10:18 AM on February 25, 2011 [3 favorites]
Even though the US is not a company, it does have a long-term fiscal problem. A large part of the current deficit is cyclical (caused by the current economic crisis), but part of it is structural. A recent column by Paul Krugman on fiscal policy: Willie Sutton Wept.
What would a serious approach to our fiscal problems involve? I can summarize it in seven words: health care, health care, health care, revenue.posted by russilwvong at 10:19 AM on February 25, 2011
Looking at the question from the other direction, why should benefit cuts be done to basic services like those specific ones I mentioned, in order to divert those benefits to private capital (investment banks, S+Ls, housing, global hedge funds, car companies, etc.)?
and this is exactly what's happening in several state capitols right now - michigan's rich synder wants to put taxes on pensions so he can decrease the business tax
posted by pyramid termite at 10:20 AM on February 25, 2011
and this is exactly what's happening in several state capitols right now - michigan's rich synder wants to put taxes on pensions so he can decrease the business tax
posted by pyramid termite at 10:20 AM on February 25, 2011
ennui.bz: what valkyryn is saying is that times are tough and since SS is solvent sorry folks, but grandma is going to have to be sick and die because we can't afford to pay for her care. Those kids living in that apartment, deaf from ear infections, have to let their teeth rot out, ok fine they are kids we'll cough up some cash for them, but their mom has to die from appendicitis because we just can't afford any more. sorry all, times are tough.
Note: Help maintain a healthy, respectful discussion by focusing comments on the issues, topics, and facts at hand—not at other members of the site.
posted by russilwvong at 10:25 AM on February 25, 2011
Note: Help maintain a healthy, respectful discussion by focusing comments on the issues, topics, and facts at hand—not at other members of the site.
posted by russilwvong at 10:25 AM on February 25, 2011
Does the budget account for corporate "entitlements" in the form of tax relief? I am pretty sure it doesn't, and if people aren't talking about defense cuts, no one is even admitting this exists.
posted by feloniousmonk at 10:33 AM on February 25, 2011
posted by feloniousmonk at 10:33 AM on February 25, 2011
Note: Help maintain a healthy, respectful discussion by focusing comments on the issues, topics, and facts at hand—not at other members of the site.
my mom juststopped working part-time at B&N retired and is living largely off SS. She might have worked longer except for the diabetes, deteriorating eye-sight, and that time she fell down the stairs. My children have health care through Medicaid/SCHIP. I have a PhD but can't find work except for odd-jobs doing carpentry/home repair under the table. I just hurt my back but I don't have health insurance so i'm hobbling around. I'd like to get Medicaid but it's actually kind of hard if you try to be honest.
so when some guy on the internet tells me sorry, times are tough but we have to cut entitlements if we are serious about USA Inc. how am I supposed to react?
posted by ennui.bz at 10:34 AM on February 25, 2011 [13 favorites]
my mom just
so when some guy on the internet tells me sorry, times are tough but we have to cut entitlements if we are serious about USA Inc. how am I supposed to react?
posted by ennui.bz at 10:34 AM on February 25, 2011 [13 favorites]
russilwvong: See the last bullet point in the first slide on page 26.
I did. It waves defense spending away because it's down 2% since 1930. That's nonsense: it's still 5% GDP, the same amount spent on Social Security and just a tad less than Medicare and Medicaid combined. Which brings me to my second point:
valkyryn: There's an entire section devoted to defense spending and it shows up in just about every budget overview.
Then we're looking at different documents, because in the "Income Statement Drilldown" section I see:
48 pages examining "Entitlement Spending",
35 pages examining "Rising Debt Level and Interest Payments",
32 pages examining "Periodic Large One-Time Charges", and
3 pages examining defense spending (as part of the intro section).
And yes, while technically defense does show up as a line item in the (relatively dense) tables on pp 58-60, it's not included in the incredibly misleading and repeating pie chart titled "Income Statement – F2010 USA Inc. Revenues + Expenses at a Glance". Come on.
posted by eamondaly at 10:46 AM on February 25, 2011 [1 favorite]
I did. It waves defense spending away because it's down 2% since 1930. That's nonsense: it's still 5% GDP, the same amount spent on Social Security and just a tad less than Medicare and Medicaid combined. Which brings me to my second point:
valkyryn: There's an entire section devoted to defense spending and it shows up in just about every budget overview.
Then we're looking at different documents, because in the "Income Statement Drilldown" section I see:
48 pages examining "Entitlement Spending",
35 pages examining "Rising Debt Level and Interest Payments",
32 pages examining "Periodic Large One-Time Charges", and
3 pages examining defense spending (as part of the intro section).
And yes, while technically defense does show up as a line item in the (relatively dense) tables on pp 58-60, it's not included in the incredibly misleading and repeating pie chart titled "Income Statement – F2010 USA Inc. Revenues + Expenses at a Glance". Come on.
posted by eamondaly at 10:46 AM on February 25, 2011 [1 favorite]
I should add that this document does make some good points and does have some perfectly valid arguments and presents some excellent options, it's far from even-handed or even comprehensive. Even if you took its premise on face value-- that a country can be treated like a company-- it undercuts itself by ignoring a whopping 20-30% of expenditures.
posted by eamondaly at 10:49 AM on February 25, 2011
posted by eamondaly at 10:49 AM on February 25, 2011
I like to think of America as a mischievous badger.
DID SOMEBODY MENTION A BADGER?
posted by thsmchnekllsfascists at 10:55 AM on February 25, 2011
DID SOMEBODY MENTION A BADGER?
posted by thsmchnekllsfascists at 10:55 AM on February 25, 2011
Oh, wait: it is included in that pie chart, so I'll eat crow on that.
posted by eamondaly at 10:59 AM on February 25, 2011
posted by eamondaly at 10:59 AM on February 25, 2011
Yglesias: How To Run America Like a Business: Get Rid Of All The Old People
posted by T.D. Strange at 12:05 PM on February 25, 2011
posted by T.D. Strange at 12:05 PM on February 25, 2011
ennui.bz: I'm sorry to hear about your situation, and I hope you and your family make it through okay.
Getting mad at valkyryn isn't going to help, though. It's true that governments can't borrow money indefinitely. Part of the current deficit is cyclical--as the economy recovers, the deficit will go down--but part of it is structural. When valkyryn says that closing the deficit will require raising taxes and cutting spending, he's just stating the obvious.
We went through this in Canada in the mid-1990s. Raising taxes and cutting spending are both really, really difficult. Krugman summarizes a recent Pew survey: everyone wants balanced budgets, nobody supports cuts to anything except foreign aid, nobody supports increased taxes. The conclusion is inescapable: Republicans have a mandate to repeal the laws of arithmetic.
valkyryn: We need to find some way of curtailing our spending and increasing our revenue, and while cutting defense spending and increasing taxes on corporations and the top 1% may be necessary, there is no evidence to suggest that it will be anywhere near sufficient over any significant period of time.
I'd suggest raising taxes on everyone, not just the top 1%. The broader the tax base, the lower the necessary increases. The increases should be progressive, of course, so that more of the burden falls on higher-income taxpayers; but not all of it.
posted by russilwvong at 12:09 PM on February 25, 2011
Getting mad at valkyryn isn't going to help, though. It's true that governments can't borrow money indefinitely. Part of the current deficit is cyclical--as the economy recovers, the deficit will go down--but part of it is structural. When valkyryn says that closing the deficit will require raising taxes and cutting spending, he's just stating the obvious.
We went through this in Canada in the mid-1990s. Raising taxes and cutting spending are both really, really difficult. Krugman summarizes a recent Pew survey: everyone wants balanced budgets, nobody supports cuts to anything except foreign aid, nobody supports increased taxes. The conclusion is inescapable: Republicans have a mandate to repeal the laws of arithmetic.
valkyryn: We need to find some way of curtailing our spending and increasing our revenue, and while cutting defense spending and increasing taxes on corporations and the top 1% may be necessary, there is no evidence to suggest that it will be anywhere near sufficient over any significant period of time.
I'd suggest raising taxes on everyone, not just the top 1%. The broader the tax base, the lower the necessary increases. The increases should be progressive, of course, so that more of the burden falls on higher-income taxpayers; but not all of it.
posted by russilwvong at 12:09 PM on February 25, 2011
Is it just me, or does part of the problem with the budget and tax rate have to do with the fact that it's held hostage by the whim of the mob, rather than through actual, you know, mathematical and scientific(ish) methods of regulating the spending/income rate? I mean, I know "economist" (and boy do I ever hate economic theory, as it fails on so many levels to produce actual real world functional models) come up with all kinds of answers, but so often you simply have to look at said economists self-interests to see where their flaws boil down to either conservative or liberal bias.
It's almost like we should just build a Deep Thought that would regulate taxation so no one ideaology gets to say "hey, that's not fair" since some objective outside entity is managing the whole shebang. But, well, that's a nice pipe dream, and everyone would argue about how the programmers were ideologically inclined to favor one philosophy or another (though if you hire nihilists, it might work just fine).
Or maybe shift the management from the elected officials to a new branch of government where positions are filled by people who compete for the positions though rigorous mathematics tests and who ever scores the highest gets to work out the equations for fair and equitably taxation and budget spending for the government. You know, eliminate political bias and self interest through a mask of "find the optimal solution, where your interests are removed from the equation".
I think that's the biggest failure of any of these arguments. No one can see the "true and right" answer because they are part of the equation, and thus, their position in said equation determines how they view the answer.
Or something. I don't know. I should sleep more.
posted by daq at 12:33 PM on February 25, 2011 [1 favorite]
It's almost like we should just build a Deep Thought that would regulate taxation so no one ideaology gets to say "hey, that's not fair" since some objective outside entity is managing the whole shebang. But, well, that's a nice pipe dream, and everyone would argue about how the programmers were ideologically inclined to favor one philosophy or another (though if you hire nihilists, it might work just fine).
Or maybe shift the management from the elected officials to a new branch of government where positions are filled by people who compete for the positions though rigorous mathematics tests and who ever scores the highest gets to work out the equations for fair and equitably taxation and budget spending for the government. You know, eliminate political bias and self interest through a mask of "find the optimal solution, where your interests are removed from the equation".
I think that's the biggest failure of any of these arguments. No one can see the "true and right" answer because they are part of the equation, and thus, their position in said equation determines how they view the answer.
Or something. I don't know. I should sleep more.
posted by daq at 12:33 PM on February 25, 2011 [1 favorite]
A "balanced budget" isn't necessary. Getting the deficit down below the rate of GDP growth and keeping it there is necessary, and if it doesn't happen relatively soon things will go badly.
It's sort of hard to believe there's anyone out there who is determined enough to have remained thus-far unaware that the US has a bit of a problem with deficit spending and future liabilities, and yet willing to learn about it now. As they put it over at the Financial Management Service of the US Treasury: "The projections in this Report indicate that the trajectory of current policy is not sustainable." This is news to someone? Their extrapolation of 2010 policy has debt-to-gdp going over 100% sometime before 2035. That seems... optimistic. They extrapolate non-interest spending being higher than revenue forever, and then spending on paying interest on the debt rising rapidly to a few percent of GDP in the next few years, to 10% in the next few decades, and beyond to infinity. Anyway, they also say it's possible to delay doing anything about it for ten years, and it'll only cost 2.9% of GDP per year thereafter to fix things up. Who knows, they may even turn out to be right about that.
In other news, shares of USA Inc rose today to 1/1402.50oz, as the market decided that revolutions in the Middle East are less likely than previously estimated to bring about the end of the world within the next week.
posted by sfenders at 12:35 PM on February 25, 2011
It's sort of hard to believe there's anyone out there who is determined enough to have remained thus-far unaware that the US has a bit of a problem with deficit spending and future liabilities, and yet willing to learn about it now. As they put it over at the Financial Management Service of the US Treasury: "The projections in this Report indicate that the trajectory of current policy is not sustainable." This is news to someone? Their extrapolation of 2010 policy has debt-to-gdp going over 100% sometime before 2035. That seems... optimistic. They extrapolate non-interest spending being higher than revenue forever, and then spending on paying interest on the debt rising rapidly to a few percent of GDP in the next few years, to 10% in the next few decades, and beyond to infinity. Anyway, they also say it's possible to delay doing anything about it for ten years, and it'll only cost 2.9% of GDP per year thereafter to fix things up. Who knows, they may even turn out to be right about that.
In other news, shares of USA Inc rose today to 1/1402.50oz, as the market decided that revolutions in the Middle East are less likely than previously estimated to bring about the end of the world within the next week.
posted by sfenders at 12:35 PM on February 25, 2011
why should benefit cuts be done to basic services like those specific ones I mentioned, in order to divert those benefits to private capital
Maybe other people are proposing that, but I'm not.
posted by valkyryn at 1:10 PM on February 25, 2011
Maybe other people are proposing that, but I'm not.
posted by valkyryn at 1:10 PM on February 25, 2011
A Proposal for Baby Boomers
They came from youthful
hot spurs readying for war,
and grew better nourished
than any before, fed on
black tea as old as dinosaurs,
and loved each other in some Summer forevermore.
They stopped the conflict they were dying for
and sat down instead to play a game
of nuclear chess with pieces made
and given from their fathers' tests.
More food, more wine, more technology
then the thousand years previously
squandered on their personal convenience
and the luxury of obesity. And they worship
the All-Mighty-Dollar – too good to be
the farmer's son or run the old man's factory,
but managers, CO's, financiers cheering on the market,
thinking numbers on a board is what brought down the Berlin Wall.
It's a victory they celebrate as proof of their genius,
its anniversary appears in every newspaper, on every TV.
Gatekeepers of taste, censors by majority,
I say kill them, kill them all,
take their wealth, and take their jobs.
Their green-golden idol has turned to paper and tin.
You know that they are scared of death fast approaching
and are desperate, dangerous men,
whose to say that once their bodies rot
from cancer, their minds emptied by Alzheimer,
they won't send their youth off to war
to bring them more and more? They're nothing but a stomach.
Let us kill them, let us kill them and share what's left.
I am not proud to be an American,
to live in a Democracy of emperors and kings,
of warmongers and thieves who believe
a banker 'sworth a thousand teachers,
a bomb better built than a school,
who sit idly by as the bridges
and roads their fathers made fall apart,
who have sold us off as slaves
to foreigners with trillions of votive promises
of our labor, of our future wealth,
and now in their twilight,
in their craven and selfish fears
have watched their parents die
lonely, forgotten, and abused
in retirement houses,
they clamor for healthcare, they desire to be looked after
just as they have been from the cradle
and now to their grave,
I say kill them,
kill them all before they demand pyramids.
posted by Shit Parade at 2:59 PM on February 25, 2011
They came from youthful
hot spurs readying for war,
and grew better nourished
than any before, fed on
black tea as old as dinosaurs,
and loved each other in some Summer forevermore.
They stopped the conflict they were dying for
and sat down instead to play a game
of nuclear chess with pieces made
and given from their fathers' tests.
More food, more wine, more technology
then the thousand years previously
squandered on their personal convenience
and the luxury of obesity. And they worship
the All-Mighty-Dollar – too good to be
the farmer's son or run the old man's factory,
but managers, CO's, financiers cheering on the market,
thinking numbers on a board is what brought down the Berlin Wall.
It's a victory they celebrate as proof of their genius,
its anniversary appears in every newspaper, on every TV.
Gatekeepers of taste, censors by majority,
I say kill them, kill them all,
take their wealth, and take their jobs.
Their green-golden idol has turned to paper and tin.
You know that they are scared of death fast approaching
and are desperate, dangerous men,
whose to say that once their bodies rot
from cancer, their minds emptied by Alzheimer,
they won't send their youth off to war
to bring them more and more? They're nothing but a stomach.
Let us kill them, let us kill them and share what's left.
I am not proud to be an American,
to live in a Democracy of emperors and kings,
of warmongers and thieves who believe
a banker 'sworth a thousand teachers,
a bomb better built than a school,
who sit idly by as the bridges
and roads their fathers made fall apart,
who have sold us off as slaves
to foreigners with trillions of votive promises
of our labor, of our future wealth,
and now in their twilight,
in their craven and selfish fears
have watched their parents die
lonely, forgotten, and abused
in retirement houses,
they clamor for healthcare, they desire to be looked after
just as they have been from the cradle
and now to their grave,
I say kill them,
kill them all before they demand pyramids.
posted by Shit Parade at 2:59 PM on February 25, 2011
Now imagine that you're a shareholder in USA Inc.
Hmmm... Nope, don't like the debt to equity ratio, and the current board appears more concerned with their Q3 2012 numbers than improving their financials.
Can I short them instead?
Oh, look, I can!
ZenMasterThis : We don't even want them to improve productivity?
Of course not! The would require trimming the fat, and put bluntly - Look around you next time you buy Chinese-manufactured crap from the local Walmart.
verb : Government is not a for-profit corporation.
Non-profits have a bottom line, too. And if they stay in the red too long, they cease to exist.
posted by pla at 3:27 PM on February 25, 2011
Hmmm... Nope, don't like the debt to equity ratio, and the current board appears more concerned with their Q3 2012 numbers than improving their financials.
Can I short them instead?
Oh, look, I can!
ZenMasterThis : We don't even want them to improve productivity?
Of course not! The would require trimming the fat, and put bluntly - Look around you next time you buy Chinese-manufactured crap from the local Walmart.
verb : Government is not a for-profit corporation.
Non-profits have a bottom line, too. And if they stay in the red too long, they cease to exist.
posted by pla at 3:27 PM on February 25, 2011
sfenders : Getting the deficit down below the rate of GDP growth and keeping it there is necessary, and if it doesn't happen relatively soon things will go badly.
That presumes infinite growth, forever. We've kinda run out of indigenous peoples to exploit, and have already spent most of what we know about that we can pull out of the ground in the near future. As for space... It takes a LOT of energy to make doing anything off-planet feasible, and we've nearly exhausted our supply of dead dinos.
So yes, we do need to balance the budget. Not only do we need to balance it, we need to do just a bit better than that, to start paying off our massive outstanding debt. And we damned well better do it before our creditors realize that our golden age has come and gone.
posted by pla at 3:41 PM on February 25, 2011
That presumes infinite growth, forever. We've kinda run out of indigenous peoples to exploit, and have already spent most of what we know about that we can pull out of the ground in the near future. As for space... It takes a LOT of energy to make doing anything off-planet feasible, and we've nearly exhausted our supply of dead dinos.
So yes, we do need to balance the budget. Not only do we need to balance it, we need to do just a bit better than that, to start paying off our massive outstanding debt. And we damned well better do it before our creditors realize that our golden age has come and gone.
posted by pla at 3:41 PM on February 25, 2011
Simon Johnson of Baseline Scenario: Does the US Really Have a Fiscal Crisis?
Our main fiscal issues are three (see my testimony to the Senate Budget Committee earlier this month). The most immediate problem is that our largest banks and closely related parts of the financial system blew themselves up in 2007-08. The ensuring recession and associated loss of tax revenue will end up pushing up our government debt, as a percent of GDP, by around 40 percent. Very little of this debt increase was due to the fiscal stimulus; mostly it was caused by lower tax revenue, because of the slump in output and employment.posted by russilwvong at 4:03 PM on February 25, 2011 [1 favorite]
The financial system poses a major risk to our fiscal outlook over the next few years. ...
Second, we need to control health care spending as a percent of G.D.P. The issue is most definitely not about cutting the current level of such spending or immediately reducing the benefits in Medicare. But in the projections, by 2030 or 2040, the growth of health care spending ruins us all — whether or not we get the government to pay for it.
During the health care debate of 2009-10, there was very little attempt to explain this issue and discuss the options. The administration made a halfhearted move in this direction but backed away as soon as leading Republicans began to claim there were “death panel” proposals on the table.
Third, our tax system is completely antiquated. For the same level of tax revenue relative to G.D.P., we could greatly reduce the distortions (e.g., disincentives to work) just by modernizing. The right and the left agree that we should tax consumption more and income less, but neither is willing to make any kind of meaningful move toward a value-added tax (VAT).
The stark reality is that we can no longer eat our cake and have it too.
If we raise taxes, yes, we can. Remember that whole Clinton raising income taxes? And what happened? BALANCED BUDGETS!!!!!!
this is all GOP speak. Big surprise it is in the Wall Street Journal. I'm shocked!
posted by Ironmouth at 4:09 PM on February 25, 2011 [1 favorite]
If we raise taxes, yes, we can. Remember that whole Clinton raising income taxes? And what happened? BALANCED BUDGETS!!!!!!
this is all GOP speak. Big surprise it is in the Wall Street Journal. I'm shocked!
posted by Ironmouth at 4:09 PM on February 25, 2011 [1 favorite]
And we damned well better do it before our creditors realize that our golden age has come and gone.
Our creditors are ourselves. Americans own most of our debt. There are a lot of "sky is falling" people who make it sound like China owns 99% of our debt. Not at all. Most of our debt is owned by our own citizens and our own banks.
Second, the chances of some sort of run for the exits are, according to the Bank for International Settlements "highly improbable."
People need to stop listening to GOP fraudsters who want to tell you that the most important thing we can do is not raise taxes on the 2% of U.S. citizens who own nearly 70% of the wealth in the United States. This is poppycock.
In short, the entire subject of this post is a huge propaganda piece by the biggest financial newspaper in the United States.
posted by Ironmouth at 4:20 PM on February 25, 2011 [4 favorites]
Our creditors are ourselves. Americans own most of our debt. There are a lot of "sky is falling" people who make it sound like China owns 99% of our debt. Not at all. Most of our debt is owned by our own citizens and our own banks.
Second, the chances of some sort of run for the exits are, according to the Bank for International Settlements "highly improbable."
People need to stop listening to GOP fraudsters who want to tell you that the most important thing we can do is not raise taxes on the 2% of U.S. citizens who own nearly 70% of the wealth in the United States. This is poppycock.
In short, the entire subject of this post is a huge propaganda piece by the biggest financial newspaper in the United States.
posted by Ironmouth at 4:20 PM on February 25, 2011 [4 favorites]
Malor: "But if it doesn't balance the budget, the eventual economic destruction as it prints money to fund its profligate spending will be even worse."
Only if there's a better monetary alternative, which there is not at present. Otherwise, you're just talking about doom and gloom of the inevitable sort. If the unthinkable becomes thinkable, we're fucked anyway. As in, as long as China and everybody else keep giving us their shit for absolutely nothing in return, we'll be fine.
It would just be nice if we could distribute all the free shit at least a little more equitably.
Do you seriously think the rest of the world is going to stop the crack binge until we're all dead in a gutter together? I don't. Let's acknowledge that reality and go from there, hmm? (unless you have a good argument as to why/how that's not how it's all going to play out..I'm just not seeing it, even China is a slave to the crack habit for crying out loud)
posted by wierdo at 6:12 PM on February 25, 2011
Only if there's a better monetary alternative, which there is not at present. Otherwise, you're just talking about doom and gloom of the inevitable sort. If the unthinkable becomes thinkable, we're fucked anyway. As in, as long as China and everybody else keep giving us their shit for absolutely nothing in return, we'll be fine.
It would just be nice if we could distribute all the free shit at least a little more equitably.
Do you seriously think the rest of the world is going to stop the crack binge until we're all dead in a gutter together? I don't. Let's acknowledge that reality and go from there, hmm? (unless you have a good argument as to why/how that's not how it's all going to play out..I'm just not seeing it, even China is a slave to the crack habit for crying out loud)
posted by wierdo at 6:12 PM on February 25, 2011
It's all very well to GRAR about how a country is not the same thing as a business, but it does not follow that there is nothing to be learned by using some familiar analytical techniques to simplify a complex subject.
It does not argue that the government must be run like a business in the pursuit of endless profit, or that half the population should be sold into slavery, or that taxes are a hideous commie plot. All it does is present information about the fiscal position of the US government in a format similar to a company's annual report. The same kind of information which public companies are required by the SEC to disclose on a regular basis, so that shareholders, creditors, and employees can estimate the health and stability of the business.
It seems like only a few people bothered to spend any time reading the thing before firing off an opinion on it. Because suggestions like investing more in education and public health, adopting a more progressive and consumption-based tax system, reducing income inequality and corporate welfare, instituting a carbon tax, and investing more in infrastructure, research, and social development all seem like the kind of thing most MeFites are strongly in favor of...and are all among the suggestions offered by the author of the report for improving the fiscal health of the US. It's nice sensible Keynesian economics, and if people would chill out a little and read through it before condemning it, they would find a great deal to like about it.
posted by anigbrowl at 6:26 PM on February 25, 2011 [2 favorites]
It does not argue that the government must be run like a business in the pursuit of endless profit, or that half the population should be sold into slavery, or that taxes are a hideous commie plot. All it does is present information about the fiscal position of the US government in a format similar to a company's annual report. The same kind of information which public companies are required by the SEC to disclose on a regular basis, so that shareholders, creditors, and employees can estimate the health and stability of the business.
It seems like only a few people bothered to spend any time reading the thing before firing off an opinion on it. Because suggestions like investing more in education and public health, adopting a more progressive and consumption-based tax system, reducing income inequality and corporate welfare, instituting a carbon tax, and investing more in infrastructure, research, and social development all seem like the kind of thing most MeFites are strongly in favor of...and are all among the suggestions offered by the author of the report for improving the fiscal health of the US. It's nice sensible Keynesian economics, and if people would chill out a little and read through it before condemning it, they would find a great deal to like about it.
posted by anigbrowl at 6:26 PM on February 25, 2011 [2 favorites]
A Proposal for Baby Boomers
vogons had a baby boomer generation, too?
posted by pyramid termite at 8:41 PM on February 25, 2011
vogons had a baby boomer generation, too?
posted by pyramid termite at 8:41 PM on February 25, 2011
Non-profits have a bottom line, too. And if they stay in the red too long, they cease to exist.
...Yes, which is why I suggested that successful nonprofits would be better models for an article like this. The issue isn't the advocacy of balanced budgets, rather the immediate assumption that running the government like a commercial enterprise is the proper approach to achieving that goal.
Ferrets have a bottom line, too. If they expend more energy than they consume for too long, they cease to exist. Why not run the country like a ferret?
posted by verb at 4:54 AM on February 26, 2011 [3 favorites]
...Yes, which is why I suggested that successful nonprofits would be better models for an article like this. The issue isn't the advocacy of balanced budgets, rather the immediate assumption that running the government like a commercial enterprise is the proper approach to achieving that goal.
Ferrets have a bottom line, too. If they expend more energy than they consume for too long, they cease to exist. Why not run the country like a ferret?
posted by verb at 4:54 AM on February 26, 2011 [3 favorites]
It's nice sensible Keynesian economics, and if people would chill out a little and read through it before condemning it, they would find a great deal to like about it.
For the record, I didn't condemn the article. I just thought that the framing of the concept was another symptom of the profit-oriented vocabulary that we've slowly drifted into as a culture. I stand by that criticism.
posted by verb at 4:57 AM on February 26, 2011 [4 favorites]
For the record, I didn't condemn the article. I just thought that the framing of the concept was another symptom of the profit-oriented vocabulary that we've slowly drifted into as a culture. I stand by that criticism.
posted by verb at 4:57 AM on February 26, 2011 [4 favorites]
Maybe I'm naive but it seems to me that certain things should not be run as businesses. One of the reasons health care costs rise as they do is that they are "administered" by companies that must show a profit. Profiting from the sick seems unfair on the surface and downright unscrupulous in actual practice. Similarly for all basic needs. Housing, nutrition and education come to mind.
The American economic system is not run as a business. It's run as a ponzi scheme. The government actively underwrites this scheme and willingly serves us up as the suckers necessary to perpetuate it.
posted by Jode at 9:23 AM on February 26, 2011
The American economic system is not run as a business. It's run as a ponzi scheme. The government actively underwrites this scheme and willingly serves us up as the suckers necessary to perpetuate it.
posted by Jode at 9:23 AM on February 26, 2011
You can't apply corporate motivations (providing elective goods and services to a consumer population for PROFIT) to a government which provides needed services to the general population for no profit.
Not to pick on that comment in particular, but a general theme in this thread is that the US Government is not a corporation, it doesn't have the same motivations as a company (i.e., creating profit), and therefore should not be analyzed like a corporation.
There is a subtle but significant flaw in this logic, however, in that the goal of any corporation is not exclusively to profit, but instead to maximize shareholder value. While this includes reducing costs and increasing revenue, it also involves managing the capital structure (debt vs equity financing), and increasing the predictability of returns.
In this regard, the goals of any shareholder are similar to that of any US citizen, in that they should desire to live in a place where they truly believe that government services are run as efficiently as possible, future generations are not burdened by excessive debt and entitlement liabilities, and there is a stable and just environment in which he can exist. I would challenge anyone who thinks this analysis is not valid to devise a better framework, instead of resorting to ad hominem attacks on the author or questioning the data (much of which comes from congressional budget office).
posted by smfullman at 9:49 AM on February 26, 2011 [1 favorite]
Not to pick on that comment in particular, but a general theme in this thread is that the US Government is not a corporation, it doesn't have the same motivations as a company (i.e., creating profit), and therefore should not be analyzed like a corporation.
There is a subtle but significant flaw in this logic, however, in that the goal of any corporation is not exclusively to profit, but instead to maximize shareholder value. While this includes reducing costs and increasing revenue, it also involves managing the capital structure (debt vs equity financing), and increasing the predictability of returns.
In this regard, the goals of any shareholder are similar to that of any US citizen, in that they should desire to live in a place where they truly believe that government services are run as efficiently as possible, future generations are not burdened by excessive debt and entitlement liabilities, and there is a stable and just environment in which he can exist. I would challenge anyone who thinks this analysis is not valid to devise a better framework, instead of resorting to ad hominem attacks on the author or questioning the data (much of which comes from congressional budget office).
posted by smfullman at 9:49 AM on February 26, 2011 [1 favorite]
I dispute that the goals of most US citizens are "government services are run as efficiently as possible, future generations are not burdened by excessive debt and entitlement liabilities, and there is a stable and just environment". Most people's concerns are far more immediate in time and place. Such as, "what's in it for me, today?"
posted by ryanrs at 2:04 PM on February 26, 2011 [1 favorite]
posted by ryanrs at 2:04 PM on February 26, 2011 [1 favorite]
I would challenge anyone who thinks this analysis is not valid to devise a better framework, instead of resorting to ad hominem attacks on the author or questioning the data (much of which comes from congressional budget office).
Budget numbers are not a premise, they are facts deployed in defense of a conclusion. I would challenge anyone who is defending the idea that the government should be run like a corporation to actually defend it, rather than hurling accusations at those who are skeptical of the premise.
posted by verb at 7:34 AM on February 27, 2011 [1 favorite]
Budget numbers are not a premise, they are facts deployed in defense of a conclusion. I would challenge anyone who is defending the idea that the government should be run like a corporation to actually defend it, rather than hurling accusations at those who are skeptical of the premise.
posted by verb at 7:34 AM on February 27, 2011 [1 favorite]
Nobody claimed 'the government should be run like a corporation,' not even the author of the presentation. It's disappointing that this canard has been repeated so frequently as to shut down any serious discussion.
posted by anigbrowl at 11:28 AM on February 27, 2011
posted by anigbrowl at 11:28 AM on February 27, 2011
Nobody claimed 'the government should be run like a corporation,' not even the author of the presentation. It's disappointing that this canard has been repeated so frequently as to shut down any serious discussion.
In this particular thread, no one has explicitly advocated that -- although they numerous people have echoed the fallacious muddling of 'corporation' and 'fiscally responsible entity'. It's worth remembering that others in this thread have argued in favor of the article by suggesting that nonprofit organizations don't have to balance their books.
This 'pro-corporate' concept is a baked-in part of our public discourse at the moment, however, with the idea of 'CEO presidents' and so on being essential parts of the national dialogue over the past several administrations. In that context, the Wall Street Journal runs an article with the title, 'What if it were run like a corporation?' essentially wiping away the distinction between 'public corporation' and 'entity that balances its books.'
A number of people, myself included, noted the problem with the implied premise. And then lots of people whined about it. That's not "shutting down serious discussion."
posted by verb at 12:42 PM on February 27, 2011
In this particular thread, no one has explicitly advocated that -- although they numerous people have echoed the fallacious muddling of 'corporation' and 'fiscally responsible entity'. It's worth remembering that others in this thread have argued in favor of the article by suggesting that nonprofit organizations don't have to balance their books.
This 'pro-corporate' concept is a baked-in part of our public discourse at the moment, however, with the idea of 'CEO presidents' and so on being essential parts of the national dialogue over the past several administrations. In that context, the Wall Street Journal runs an article with the title, 'What if it were run like a corporation?' essentially wiping away the distinction between 'public corporation' and 'entity that balances its books.'
A number of people, myself included, noted the problem with the implied premise. And then lots of people whined about it. That's not "shutting down serious discussion."
posted by verb at 12:42 PM on February 27, 2011
And then lots of people whined about it. That's not "shutting down serious discussion."
Also, for the millionth time, people not agreeing with you does not constitute "shutting down the discussion."
posted by Ironmouth at 11:19 AM on February 28, 2011 [1 favorite]
Also, for the millionth time, people not agreeing with you does not constitute "shutting down the discussion."
posted by Ironmouth at 11:19 AM on February 28, 2011 [1 favorite]
In that context, the Wall Street Journal runs an article with the title, 'What if it were run like a corporation?' essentially wiping away the distinction between 'public corporation' and 'entity that balances its books.' A number of people, myself included, noted the problem with the implied premise. And then lots of people whined about it. That's not "shutting down serious discussion."
I take this as proof that you have made no effort to follow the links in the FPP, because none of them point to the Wall Street Journal. In fact, the Wall Street Journal has yet to publish an article on this subject. This is what the FPP says:
Strangely enough, the Kleiner Perkins website doesn't ask 'What if the USA were run like a corporation' either. This is what it says:
One more time: this FPP has nothing to do with the Wall Street Journal. The Wall Street Journal has not published a single article on this topic as of today. There are no links to the Wall Street Journal anywhere in this thread. The Wall Street Journal's connection with this FPP exists only in your imagination.
posted by anigbrowl at 8:25 PM on February 28, 2011
I take this as proof that you have made no effort to follow the links in the FPP, because none of them point to the Wall Street Journal. In fact, the Wall Street Journal has yet to publish an article on this subject. This is what the FPP says:
Wall Street analysts look at the financial health of the United States as if the country were a private business.Not "Wall Street Journal analysts". Just an analyst that works on Wall Street. Specifically, at a private equity firm called Kleiner Perkins, which was where the first link in the FPP points to. The second one points to the New York Review of Books, with an article about the economic roots of the popular discontent sweeping the Middle East.
Strangely enough, the Kleiner Perkins website doesn't ask 'What if the USA were run like a corporation' either. This is what it says:
USA Inc.is a non-partisan report that looks at the U.S. federal government (and its financials) as if it were a business. Mary Meeker, partner at KPCB and former financial analyst at Morgan Stanley, created and compiled the report with the goal of informing the discussion about our financial situation and outlook. USA Inc. examines the country’s income statement and balance sheet, aiming to interpret the underlying data and facts, and illustrate patterns and trends in easy-to-understand ways. The report also analyzes the drivers of federal revenue and the history of expense growth, and discusses basic scenarios for how revenue and expense growth might change to help America move toward positive cash flow.This is not a proposal to run the government like it's a corporation. As many people have pointed out, that would be a stupid idea because economies do not run the same way as individual firms. And that would explain why the various solutions and suggestions considered in the report are limited to the sort of things that governments can spend on, regulate, or tax.
One more time: this FPP has nothing to do with the Wall Street Journal. The Wall Street Journal has not published a single article on this topic as of today. There are no links to the Wall Street Journal anywhere in this thread. The Wall Street Journal's connection with this FPP exists only in your imagination.
posted by anigbrowl at 8:25 PM on February 28, 2011
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There is nothing in this sentence that isn't wrong with America.
posted by DU at 5:06 AM on February 25, 2011 [84 favorites]