“Okay. Let’s just chew our way out of here.” – Big Trouble in Little China
The Andy Griffith show would have been a lot different if her name had been Aunt Tifa.
I like thinking about the economy and what we have in front of us, and I guess I’m not alone.
Recently I stumbled across a column in Zero Hedge® that originated from Mike Shedlock at his place (link below). Shedlock has been writing about economics for years, and was pretty far out in front of the Great Recession. When Shedlock starts to tease at the threads of the economy, he just might have something interesting to say.
How Much Do Food Stamps, Social Security, and Medicare Support the Economy?
Anyway, the column that caught my eye tied back inflation to the amount of money that the government spends that it doesn’t get anything for, or transfer payments – pulling from one source (taxes or printing) to give to another person or group. The examples of this are everywhere. Shedlock mentions:
- food stamps,
- Taylor Swift,
- Social Security,
- Late night television hosts,
- Medicare,
- PEZ® theft,
- Medicaid,
- Kamala’s vodka supply,
- child tax credits, and
- other “welfare” payments.
Okay, I’ll admit I might have added a few things to Mike’s list.
It’s been three months since I joined the gym and I’ve had zero progress. Tomorrow I’ll go in person to see what the problem is.
During the Great COVID Crisis, first Trump and then Biden threw money at the economy, and the amount of income that people got from the government in transfer payments DOUBLED as a percentage of income. That’s staggering. This isn’t an absolute number, but as a percentage, which actually makes it worse. Not to mention all the companies that got paid for not doing business, not selling beer, and not making good movies. Disney®, I’m looking at you.
Here’s an odd sentence: Missing Person Remains Found.
Part of the trouble with the economy has been masked, for years. That trouble is Social Security. In 2018, Social Security started paying out more in benefits than it received in taxes. This was supposed to be just fine because all of the payments from past years that were put into a “trust fund”.
Well, Congress didn’t just pile all of those tax dollars it was taking in under the mattress or in a Mason® jar buried back near the old outhouse behind the Fed®. Nope. Congress did what politicians always do with every available dollar: they spent it to buy nice things (things that lobbyists wanted) immediately when they got the cash in their appetizer-covered little fingers. Oh, and they borrowed more, too. The only thing the “trust fund” did was mask the true size of the deficit.
What if your trust fund has a negative balance?
It’s like that with most things the government does, but there is a limit to how much of the economy you can just make up before reality eventually catches up with you. Ask Enron™.
Regardless, things are going to get much, much worse. All of those illegals that are streaming across the border as fast as we can pay (yes, the United States is actually paying cash to them on the road) them to get here? Once they get here, they’re being paid thousands of dollars a year plus free chow and lodging and medical care. All of that cash is just printed at this point, and spent on something that adds no net productivity to the economy.
Well, he is called Bad Luck Brian for a reason. He also invested his life savings with Bernie Madoff.
And, where, exactly are these millions of people going to live? They’re staying 30 to a house, and buying up properties that used to go to Bobby and Becky when they got married, but now can’t afford them due to the massive competition and rising interest rates.
The Boomers? They’re retiring in droves right now, and Social Security and Medicare spending will only increase as they retire. This will, of course, come from spending rather than the non-existent trust fund.
None of the above counts how much more we’ll send to Ukraine or Taiwan or Israel or Haiti.
All of these transfer payments *plus* the increased interest on the debt that we took out to buy the things the lobbyists wanted in 1994 will result in stopping Congress from spending.
Ha! See! I made it through that with a straight face. Man, I should have used that line on April Fools’ Day. Of course Congress isn’t going to stop spending. They’re not even going to slow down. There are still appetizers to be eaten, and lobbyists to be massaged.
One lobbyist even lobbied to save the penny. He called himself a change agent.
And again, Congress got away with this quite well when the United States was the Sole Global Superpower™. Now? China is pushing us economically, and from a military standpoint, it’s looking pretty iffy: no one wants to sign up to fight Russia for Ukraine, or China for Taiwan. Additionally, unless the war(s) go nuclear, I question how prepared we are to fight a near-peer foe in 2024.
Like I said, I like thinking about the future of the economy. I always have enjoyed horror movies.
“Additionally, unless the war(s) go nuclear, I question how prepared we are to fight a near-peer foe in 2024.”
Particularly if it goes nuclear. Russia’s 500 series air defense units can shoot down ICBMs, while ours (Patriot?) can’t touch a hypersonic MIRV.
Huh, hadn’t heard that. That’s not good.
Well, I’ve paid into SS & Medicare since 1976. And receive a pittance, despite contributing hundreds of thousands over the years. Ahhh, if only I owned my SS account and invested it in ESSO.
I seem to remember that efforts were made (Ron Paul?) to enact that but failed. Miserably.
The whole system will fail quickly…one day. Laquisha will go to Food Dawg, er Lion, and her EBT won’t work. Within 3 days, chaos.
Lamont, I’m right there with you on paying into the .gov part of my paycheck for decades. And “they” have a lot of derogatory names for us, for having the gall and nerve to collect. Not that we give a ____…
And when the EBT cards don’t work – and “dey fines out” – it won’t take 3 days, brother; they will lose their collective shit that afternoon…
Nah, the EBT will always work. It’ll be the power that goes out.
Seems as though a balanced budget amendment with real teeth would put an end to most of these issues. Currently there are no ramifications to giving billions of dollars to Ukraine because this money is just printed from thin air. Yes, it affects inflation in the long run, but only as a secondary effect. But if politicians have to decide between spending those billions on Ukraine vs. keeping Medicare solvent, then that becomes a whole different story because the politician knows he/she/xir won’t be re-elected if they steal money directly from grandma.
How much of our support to Ukraine is in cash, and how much is in hardware? Most of it is hardware, I believe, which is made by American defense industry workers, who spend their wages into the local (and global) economy. Our agriculture is so efficient that we can feed ourselves with a tiny fraction of the population (while the diesel and ammonia hold out), freeing others to … do what?
Lathechuck
But which politician in the last 30 years has even suggested it? They just love spending.
FRED knows just how high transfer payments are. That’s the official Federal Reserve Economic Data. Currently total transfer payments are around $4 trillion annually, down from a $5 trillion high during COVID. And up from effectively zero during the pre-Regan 1970s, which I personally remember as “the good old days”.
https://fred.stlouisfed.org/series/W014RC1A027NBEA
The majority of that cash, around $3 trillion, went straight to individuals…
https://fred.stlouisfed.org/series/B087RC1A027NBEA
The rest was Federal handouts to the States, effectively bribes to get the States to acquiesce to the Federal political agenda. That ain’t how it’s supposed to be, but hey, money talks and currently all that States Rights Constitutional malarkey walks.
Cato has a good overview on transfer payments…
https://www.cato.org/briefing-paper/how-federal-government-spends-67-trillion#redistribution-dominates-federal-spending
…and yeah, they’re gonna be the death of US, er, us.
Yup. And FRED will count it.
The dollar has been plummeting here the past couple years. An effect intended by our ‘leaders’, who want to destroy America and build it back better in, dayum who coulda guessed, their own image. . . kind of a Baphomet-looking thing.
I can’t do anything about inflation, the Fed, devaluation and etc., so I concentrate on the stuff I can alter and flush the rest.
Exactly. I try to make myself better. That’s what I can do. And write.
So far that’s working fine, so if I were you, I’d just keep on going.
John–how does this “spreading your remains at Disney World” thing work anyway? It is a rather macabre but intriguing concept. Are you thinking woodchipper set on maximum spray distance? Or mixing the remains cannibal style in a batch of PEZ to be given out freely to visitors as they enter the park? I’m more into the whole Viking funeral thing myself and have a kayak and can of kerosene set aside for the day when I leave this mortal plane.
No, very large, recognizable chunks. Like a forearm or a hand. It’s more fun that way.
Explosive dispersal works well.
Oooooh, I like that.
I shared Aunt Tifa with my daughter. She thought that The Andy Griffith show could have spawned the entire Marvel universe if her name had been Aunt Mann.
P.S. Please don’t tell her about this blog. She thinks that I create all the puns I steal from you.
Excellent!!!! Aunt Mann! Ha!
An excellent and humous (gotta bone to pick with you LOL) report on our grim future.
And you didn’t even discuss how our replacements (some from the South American Prision systems) are going to act when the government issued cellphones ring them up.
Got Trusted Friends and Trusted Family to cover your back? Fake money in “The Bank” transferred into real hold in your hands stuff?
The question is how long before the Normies “Normalcaly Bias” falls into flames and panic.
Even decent normal neighbors will get dangerous when “Daddy, I’m HUNGRY” becomes the song of the land.
Michael
Yup, three days and people get restless when there are no chicken pot pies.
As much as I want to critique the government for running such a deficit, it’s crucial to note that there is much more at play here.
It’s important to remember that the government doesn’t borrow to spend but, rather, spends to borrow. The whole “debt as money” concept that is modern finance depends on logarithmic growth. If individuals, or private enterprises, don’t add debt at a fast enough rate the government has to or the whole thing collapses.
I am actually very thankful, at this point, that there are still so many recipients, internationally, willing to take train cars full of dollars! If they all stayed domestic, inflation would be moving at an even more whiplash rate. It’s at least serving to slow down the speed of the inevitable end game.
I’m not nearly as comfortable thinking about how much more time is left before the whole thing implodes.
Yeah, that’s the crazy part – they actually soak up a HUGE amount of our inflation.
Covid was supposed to take care of that nagging “Boomers collecting on their entitlement from 40 years of social security ‘contributions'” issue. Only Fauci, Cuomo, Walz and company didn’t manage to completely cull the herd. And Gen X, in all its unhealthy glory, is backed up right behind the last of the groovy fossils.
The left does not seem to have it figured out yet that replacing one cohort of useless eaters with another, younger cohort of useless eaters does not reduce the tab any. Replacing potentially rehireable retirees with low IQ, unskilled “newcomers” who swarm across the border like ravenous locusts is tantamount to burning the nation to the ground in order to rule over the ashes. TPTB could not do worse for this ruined country even if by design.
That’s why I think they’re Evil, too.
You are forgetting the mass vaxxes. Between the turbo cancers and the immune imprinting to make the annual ‘flu seasons more deadly, they’ll get the Boomers cleared out. The ones who refused the toxins will lose access to care. Hug your beloved elders while you can.
No, the thing is all the young men and women and teens they’ve sterlilized. I think a lot of that is the demons driving them.
They may be desperately hoping for enough unvaxed, non-gay/tranzed fertile foreigners to provide a viable serf class.
So yes. Evil.
I still haven’t seen anything to convince me we would not be better off with a currency backed by eggs. Call them quatloos, if you like. The one egg coin could have a little egg-shaped hole in the middle. You can’t hoard eggs. They’ve each got a limited lifespan. You continually have to produce more, as they are consumed daily. And it would be wise of us to break up the giant chicken conglomerates. The ones that essentially enslave thousands of small farmers through their company store policies.
Much better. And tastier.
You left out Egypt, we give them more than Israel and Egypt doesn’t upgrade our airplanes or buy all our weapons.
I heard a rumor that our ww3 plan was to issue Scream masks to the troops and hope for the best, yea a PEZ shortage is next.
Ha! Hadn’t heard that one. Maybe our troops will only go out on Halloween?
Hartnett: US Interest To Hit $1.6 Trillion By Year End, Making It The Largest US Government Outlay
teaser image
“Unchanged rates/yields & debt trend next 12 months & US refinancing rate is 4.4% and annual interest costs jump from $1.1tn to $1.6tn…”
Just wait until next year . . .
The transfer payments are a way for central authority to determine winners and losers. Instead of money going to the productive and hardest working, now it goes to whoever is in favor at any given moment. The economy is a rigged game and the losers are normal White people who still clamor “We just want to be left alone”.
Exactly. But they’ll never leave us alone.
Perfesser John wrote:
* “…unless the war(s) go nuclear, I question how prepared we are to fight…”
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open !!! Inappropriate Language Alert !!!
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LM clarifies:
I remain skeptical.
Based on decades of evidence in *each* and *every* other facet of the government agents, the entire American nuclear weapons scam was and is merely another grift.
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Trillions of fedbux transferred to slumpotamus LaExcrementisha (and her nineteen half-wit off-spring by thirteen-hundred (approximately; actual numbers unknown) sperm donors) and LaTyrone (after he is released from prison again), using the name ‘Haliburton’ and ‘Lockheed Martin’ [singular, because it is one entity].
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For decades, we all saw identical propaganda:
* very-impressive grainy black-and-white animation of some distant ‘ship’ getting knocked around while the ocean goes big-splash,
* very-impressive grainy black-and-white animation of dusty buildings getting windows knocked out.
Any of that is easily within the capabilities of artists at Disney/Fleischer during The Golden Age Of Animation.
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close !!! Inappropriate Language Alert !!!
My history teacher indicated he was at one of the tests when he was in the Navy. But I know I wasn’t . . . .
There was a baby boom — worldwide, and now the ratio of workers/retirees is shrinking — worldwide. Retirees want joint replacement operations. You can’t store doctors and nurses in a government warehouse for fifty years. “Dollars” are not doctors and nurses. Suppose you did have the dollars politicians claimed they saved. You can’t hire skilled young doctors and nurses from Japan or Switzerland with your dollars because the baby boom is worldwide. Plus the dollars only have value because they are exchangeable for things produced by taxpayers, who are numerically shrinking due to the baby boom. Thus, wealth transfer schemes can’t produce the medical care retirees thought they were saving for to provide in the future. Gary North said his high school teacher demonstrated the math didn’t work in about 1955. The Golgafrinchan Ark Fleet Ship B colonists can declare tree leaves to be currency, but doing so doesn’t produce any more lifestyle.
True. And we can’t magic more people up. Or conceive that there might be a moment in time when we don’t have to grow . . .
They not only stole from the cookie jar, they broke it into pieces and try to sell it.
Or just toss it on the floor.
Strong disagree. Congress will stop spending on things when it no longer benefits them, or threatens their job. Think of the “Normalization Phase” of Bezmenov’s plan: the Agents of Chaos (Ghaos?) were useful when chaos was needed, but once shit got bad enough that the gov was forced to crack down and implement tyranny to solve the chaos (that the gov created for precisely this reason) then those forces of Chaos had to go.
In all things, those in power will do whatever it takes to stay in power. Written and unwritten rules be damned. Remember that during the Great Depression FDR basically stole everyone’s gold as an emergency measure, other countries have seized bank accounts of citizens for no reason other than needing the money, etc. There is nothing that isn’t on the table when it comes to the elites doing whatever it takes to remain the elites.
As shown in Tainter’s “Collapse of Complex Societies”, nations only catastrophically break down when enough cans have been kicked down the road AND something unforeseen happens that the nation no longer has the resilience to survive. As long as it’s business as normal, there will always be other cans to kick down the road. Including mass gulags, Soylent Green, war with Canada, war with Maine, whatever it takes.
They won’t stop until they are stopped by an outside force.
That which cannot continue will not continue. Sooner or later the piper will call in the bill and
America won’t be able to cover the tab. When that happens things will go south…at light speed.
Nobody knows the future but it’s a guarantee that when the inevitable collapse happens thanks to
decades of spending money that doesn’t have anything tangible to back it up things will be ugly.
Ugly at a level nobody alive has ever seen and few can image. At this point point the only thing
us little people can do is pay off debts when possible and stockpile food and other necessities
in the hopes of surviving the coming storm.
And how long will inertia carry us?
If you really want to be sickened…find out how many folks get social security for medical reasons. Ya know, like fibromyalgia, migraines, bad back or anxiety.
I posit that if you offloaded that cohort; we old retired people could finally get our money back.
Nope. It’s the debt.