Let’s pretend the federal budget is a family income.

I understand that you are a fan of the Keynesian school. Lets compare the differences between how a *capitalist* manages his budget and how a Keynesian does.

When sitting around the table with the family to budget, there are certain things we can’t go without. Food, shelter, car / health insurance, etc. The federal government has defense (in my opinion that’s ALL they should be doing, but I’m sure you disagree.)

Now, lets say dad gets his hours cut at work so now he’s pulling in 20% less. He’s already riddled with credit card debt and upside down in his mortgage ($11-trillion and counting for uncle sam) and so his options seem bleak. He can either cut back his spending, suck it up, and work his ass off, or ignore it and eventually go bankrupt.

Now, if you had a friend who was in the situation I described above, and he suggested applying for 15 more credit cards and running them up to the max to maintain his standard of living, when he has absolutely no idea when and if his income will rise again, what would be your responsible advice?
They HAVE to cut back.

But since Obama will only be in office at most 8 years, he can pass the buck and come off as the good guy. And these ’stimulus’ packages full of pork to build roads we don’t even need is turning economics on his head and saying that SUPPLY DETERMINES DEMAND. IM SORRY, IT DOESNT WORK THAT WAY. GET OVER IT.

As a side note, I saw Letterman interviewing the CEO from GM, and he was all mad that GM wasn’t producing more fuel-efficient vehicles. The CEO responded that their market research indicated that the demand had subsided since the oil collapse and so they weren’t making them. Letterman was insinuating that IF WE BUILD THEM, PEOPLE WILL BUY THEM. It doesn’t work that way.

I can build a million useless widgets that no one wants, hell I can even get some stimulus money to do it, but that doesn’t mean anyone wants them! It is NOT the government’s job to decide what we need (i.e. our broke ass government giving tax incentives to certain alternative energy companies and then pushing for a windfall tax on XOM like they did something wrong. THE ONLY REASON XOM IS IN BUSINESS IS BECAUSE WE WANT THEIR PRODUCT. PERIOD. If you want to put “big oil” and “big pharma” out of business, simply A) Stop purchasing their product; or B) Keep electing Democrats, because eventually they’ll run everyone out of the country and/or out of business.

I cannot STAND Keynesians. YOU CANT FIX DEBT WITH MORE DEBT. AND IF YOU HYPERINFLATE, YOU TAX THE HARD-WORKING SAVERS TO PAY FOR PROGRAMS FOR PEOPLE WHO CONTRIBUTE NOTHING TO OUR COUNTRY. WHAT GOOD DOES THAT DO?

By the way the markets are headed lower too. Maybe a day or so of upside before it all comes tumbling down.

Marblez

Related Posts:

• Let’s review this week:
• The great depression and this crisis have to be viewed from the perspective of the run up to the crisis.
• Preview: 2nd half of 2010 and all 2011
• Watch the dollar
• Capitalists gamble with other people’s money and other people’s lives.

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