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"One should either write ruthlessly what one believes to be the truth, or else shut up."

Arthur Koestler 

Entries in Politics (393)

Friday
May132011

The Huckleberry Hound Theory of Government 

I was a member of the Huckleberry Hound Fan Club in the first grade—50 years ago. I do not remember how many box tops it cost. I got a membership card and a ring! I kept the membership card all the way to high school until it became too frayed to keep. Even back then it fit my sense of the absurd. 

Now my second grader is watching Boomerang Zoo on TV most mornings, so I caught an old episode of HH. Huck is the Purpil Pumpernickel. He could not spell worth a darn, the King said. Huck would rob from the rich, mostly the government, and give to the people, my kind of guy! Huck gave a speech like he was a politician running for office:

Huck:    I will build roads. 

Crowd: Yeah

Huck:    I will have free schools.

Crowd: Yeah! 

Huck:    I will have old age pensions.

Crowd: Yeah!!

Huck:    Of course we will have taxes.

Crowd: Boo!!!!!!

As the preacher said in Ecclesiastes 1: 

9 What has been will be again, 
   what has been done will be done again; 
   there is nothing new under the sun. 
10 Is there anything of which one can say, 
   “Look! This is something new”? 
It was here already, long ago; 
   it was here before our time.

Lord Maynard Keynes famously said that in the long run we are all dead. He was right of course, and he is dead. But we are alive and living with the consequences of his philosophy, the Huckleberry Hound Theory of Government. Even if a bar offers a “free” lunch, you will pay for it in the drinks you buy. We are like a drunk staggering to our next drink without the understanding that we are in trouble. We must think that government is magic, rainbows, and unicorns. Instead we need to understand that unless we cut the deficit, the market place will refuse to buy our bonds, and at that point the cuts will be made in an unorderly fashion. It is ironic that the writers of this cartoon understood the realities of government better than either political party will admit today. 

Monday
May092011

Guardedly Pessimistic

 

 

 

 I mentioned one of the biggest mutual funds, Pimco, and its continual pessimistic outlook on treasury debt, in my “I Love Lucy” blog post over the weekend. Pimco is upping its bet that treasuries will drop in value. 

 

(Reuters) - PIMCO’s Bill Gross, the manager of the world’s largest bond fund, raised his bet against U.S. government-related debt in April to 4 percent from 3 percent, according to the company’s website on Monday.

While this is a modest increase in Pimco’s negative treasury bets, the article mentions that this is the plan for Pimco, to gradually ratchet up the position. 

But even so, I am still guardedly pessimistic because of the speech that Speaker Boehner gave at the club of New York:

So let me be as clear as I can be.  Without significant spending cuts and reforms to reduce our debt, there will be no debt limit increase.  And the cuts should be greater than the accompanying increase in debt authority the president is given. We should be talking about cuts of trillions, not just billions.  They should be actual cuts and program reforms, not broad deficit or debt targets that punt the tough questions to the future.  And with the exception of tax hikes — which will destroy jobs — everything is on the table.  That includes honest conversations about how best to preserve Medicare, because we all know, with millions of Baby Boomers beginning to retire, the status quo is unsustainable.  

Boehner understands the seriousness of the problem. But the math will force taxes up eventually.  He is wrong about that. When you realize that to balance the budget with cuts alone means a cut of 42%, you see the need for tax increases. I do not see Social Security being cut that much, and every time you exempt a part of the budget from cuts the result is that the cut must be more severe elsewhere. The reductions in spending increases that Ryan proposed to Medicare were not well received. 

Eric Anderson, in his blog “Universe of Lies,” drew an analogy of being in a car headed for a precipice. While all Boehner is suggesting is that we slow down as we head for the cliff, even that is progress. 

We will see over the next few months if we have politicians or statesmen. I am guardedly pessimistic. 

Friday
May062011

I Love Lucy

It is not often one can quote that great Philosopher Lucille Ball. Usually her quotes are "Oh, Ricky" or "Can I be in the show?" But in her later show, "The Lucy Show," there was an episode where the troubles of the youth of the time are addressed. Remember this is the tumultuous 60's. Her character, Lucy Carmichael, said something along these lines.

The children now love luxury. They have bad manners, contempt for authority, they show disrespect to their elders. They no longer rise when elders enter the room. They contradict their parents, and chatter before company. They eat up dainties at the table, ... and are tyrants over their teachers.

The purpose of the statement is to get the older generation watching the show to agree with it. But then Lucy gives the kicker. This was said by Socrates in Ancient Greece. Immediately, the conclusion was to be drawn that the troubled youth of the 60's were in fact normal. Every generation of elders disparaged the youth. In the show, the smugness of Mrs. Carmichael was almost unbearable.

But there are several layers of difficulties with the quote. First, as Abraham Lincoln once said, "There are lots of fake quotes on the internet." While the quote was pre-internet the quote is fake--Socrates did not say it. In fact we do not really know very much of what Socrates said. It is either an adaptation of something from Plato or from Aristophanes’ play The Clouds. Secondly, to use the quote in this way shows a huge ignorance of the history of Greece. When Socrates was alive the Greek people were in a golden age. They had defeated the Persians, the greatest empire of the time, in battle-once on land and once at sea. The plays, the philosophers, and the political philosophy of that time still influence us. But the leaders of the time, especially of Athens, decided to meddle in the affairs of other countries. The Athenian Empire was very short lived. The Empirical-leaning generation that this quote refers to destroyed the Greek culture and eventually they lost their independence, not to a powerful empire, but to the barbarians to the north led by Alexander.

In this same way the generation Ms. Ball and her writers so wanted to praise—those who were teens in the 1960s—are  destroying American culture through empire, bread, and circuses, to mix a metaphor. In the same way that ancient Rome bankrupted itself to pay for their military, the free bread to keep the urban poor from rioting, and the lavish entertainment of the games at the coliseum to distract them, so this same generation will bankrupt America. The bankruptcy will occur for much the same reasons that it did for Rome.

The two plans to stop our overspending, the Ryan and the Obama plan, are both just delaying the inevitable. The biggest mutual fund, Pimco, specializing in debt, no longer purchases American government securities. They see a crisis coming. The point is not the current debt ceiling. The point is that there is a debt ceiling that will be placed by the market on US bonds when no one wants to buy them. Neither the debt increase over the next 10 years from not having a plan (debt to 26 trillion), or the debt from the Obama plan (debt to 23 trillion), or the debt from the Ryan Plan (20 trillion) are sustainable.

How convenient that the generation that is causing these issues by over consumption is exempting itself from any cuts. Those 55 and older are free from any cuts. Normally since I am 56 I should support this. But I feel strongly that what my generation is saying to my children and grandchildren can only be described with an expletive. You pick the expletive you are comfortable with.

As a concluding note, what I am trying to do in these first blog posts is to provide a philosophical background as to why I feel that each of us needs to metaphorically leave Babylon the Great. Gradually I want to add and discuss the practical ways one can be in the world, yet not of the world. I see that some of my friends are ahead of me in this journey, and others need to catch up. In any case I feel the effort is well worth it.

 

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