United States loses AAA credit rating from S&P • Hacker News Board

Re: United States loses AAA credit rating from S&P

#401

Post by mchusma » Sat, Aug 06, 2011, 4:06 PM UTC

jlangenauer wrote: post #386

DanielBMarkham wrote: post #345

Some great non-hair-on-fire conversation here. Whenever I read and note that most folks are not that far apart on things, I keep wondering why the system is so broken. Here's the systemic problem, which has nothing to do with Treasury Bills, tax structures, or political parties. Phases of political maturity: 1) Apathy. Political parties are like football teams. You pick one and they're your guys. You root for them no…

Actually, I think there's a stage before all this: 0) Withdrawal. No political party represents me, and the ones in existence represent other groups. There's nothing I can do to change the system, and it's not even worthwhile voting. I'm going to watch Jersey Shore. In most Western countries, there's a lot of people in stage 0. It's a problem for any putative democracy.

Actually, withdraw may be the last stage (or at least the most logical one). Public choice theory looks at this in depth. Essentially, if your vote doesn't really matter (and statistically it almost never does), then understanding may be too much work with too little payoff. I would say that is why the founders thought limited government was best (although that seems to no longer actually be the case)

Re: United States loses AAA credit rating from S&P

#402

Post by Unseelie » Sat, Aug 06, 2011, 4:16 PM UTC

jsz0 wrote: post #136

geuis wrote: post #52

(Reference: http://www.federalbudget.com/ ) Steps to recovery: 1) End all offensive military actions overseas. Finish winding down Iraq and abandon Afghanistan wholesale. These actions have cost several trillion dollars over the last 10 years. We can't get that money back, but we can stop spending more. 2) Defense spending is in the top 3 highest budget expenditures. Cut it by 1 third across the board. Maintain impor…

I have an easy solution. Let's make your federal income taxes look less like a bill and more like an order form. So for example some portion of your income taxes are pre-allocated for essential services (say 50%) and everything else is your choice. You get 50 points to spend and a variety of categories to choose from: education, defense, infrastructure, green energy, science research, enhanced Medicare services, NASA…

Many, many people use tax-deductable donations to do just this. Soo...this is already done. To make it done more, there should be non-profits. Non-profit insurance organizations, non-profit post, mail, private schools. Seriously, just encourage more people to donate, rather than be taxed. Of course, this won't solve the government's problem, because the government is intentionally expansionary.

Re: United States loses AAA credit rating from S&P

#403

Post by jtheory » Sat, Aug 06, 2011, 4:33 PM UTC

cookiecaper wrote: post #390

jlangenauer wrote: post #385

Earlier quoted context omitted.

As opposed to forced retirement accounts you manage yourself? Make no mistake, no sane government would allow for completely voluntary contributions to any sort of pension or superannuation scheme - it'd be setting its country up for a massive economic and social timebomb as the majority of the population put present wants over future needs. As for investing pensions in the stock market, I'll merely add that in Austr…

I strongly disagree that retirement accounts should be mandated by the government. If people won't save for retirement, they should understand that the government can't help them. This philosophy that the peon is too stupid and/or undisciplined to manage his own accounts and that the government must protect him from himself is what gets us into huge messes like this in the first place.

I understand this point of view, but at the end of the day, government policy needs to be based on what's going to work out the best for the public. It perhaps goes without saying that there are more than two approaches, but yours is one that I think we can rule out logically.

Psychologically, does it work? In general, if you tell a 22-year-old that in 40-something years he's going to really need some of the money he's making now (even if he feels like he's barely paying his bills), that he absolutely must set aside enough (and invest it wisely, assuming he has the wisdom to do so), will he manage to do it?

From what I understand of human psychology, the answer isn't "yes" nearly enough to make your solution palatable.

It sets up a good learning experience for him when he finally gets to retirement age and finds himself as a greeter in Walmart, but it's way, way too late at that point.

No one wore seatbelts before they were legally required (and still many don't, and many still die because of that dumb decision). People don't, as a rule, have a good grasp of the distant future and/or events that seem unlikely. How many people are still starting smoking, even though it says "cigarettes kill" in big black letters on that first pack they buy?

There are plenty of problems with the US social security system, but removing the safety net entirely to teach a lesson to people who fail to adequately prepare for their old age doesn't feel like a sound approach to me.

Re: United States loses AAA credit rating from S&P

#404

Post by quattrofan » Sat, Aug 06, 2011, 4:33 PM UTC

This is the beginning of the end of the dollar as the worlds reserve currency, its bad for the rest of the world and only good for the US, its imbalanced.

I am not so sure most Americans are ready for what the world will be like when it happens, because unless the need for a regular deficit is reduced and reliance for imported oil curbed, it will be very painful indeed.

Re: United States loses AAA credit rating from S&P

#405

Post by digikata » Sat, Aug 06, 2011, 4:36 PM UTC

cookiecaper wrote: post #390

jlangenauer wrote: post #385

Earlier quoted context omitted.

As opposed to forced retirement accounts you manage yourself? Make no mistake, no sane government would allow for completely voluntary contributions to any sort of pension or superannuation scheme - it'd be setting its country up for a massive economic and social timebomb as the majority of the population put present wants over future needs. As for investing pensions in the stock market, I'll merely add that in Austr…

I strongly disagree that retirement accounts should be mandated by the government. If people won't save for retirement, they should understand that the government can't help them. This philosophy that the peon is too stupid and/or undisciplined to manage his own accounts and that the government must protect him from himself is what gets us into huge messes like this in the first place.

So what do we do with people at the end of their working years, who, through bad luck or bad design, ended up with nothing. Do we stand by and let them suffer and die?

Re: United States loses AAA credit rating from S&P

#406

Post by stcredzero » Sat, Aug 06, 2011, 4:39 PM UTC

Duff wrote: post #370

winestock wrote: post #134

Earlier quoted context omitted.

When Fukuyama was talking about the Evangelical Christians, I think that he meant their doctrine of "The Rapture" and how it motivates their support for Israel. It's scary just how much of their politics rotate around that. Seriously, Christopher Hitchens (yes, that Christopher Hitchens, the atheist) can get published in National Review because of his support for Israel and for wars to bring democracy to the Middle E…

The string-pullers behind the conservative "movement" see the Evangelical Christians for what they are -- a bunch of easily fooled suckers. (Especially the non-denominational types) They are insecure, fearful people who respond to the crazy message that's being sold. One of the big motivations behind the pushing of non-denominational, stupid christianity as you get these large flocks of people attracted to the person…

They are insecure, fearful people who respond to the crazy message that's being sold.

I wonder if the powers that be have been purposefully trying to jam media with lots of spurious messages about, "The Truth Behind The Lies," most of which are structurally similar to actual such messages, but otherwise are just junk.

you get these large flocks of people attracted to the personality of the leadership of their church, but there's no doctrinal basis.

Really, this sort of thing isn't that unusual. In places in the US like Cincinnati, with large populations having immigrated generations ago from Ireland, Germany, and Eastern Europe, you have large numbers of people who call themselves "Cultural Catholics." Do they agree with all of the doctrine of the Catholic Church? Heck, a quite a number of them disagree with most of it. Attendance at mass is really just one way they identify their group.

Given that much of the motivation for religious practice is really group affiliation, it's no wonder there's a lot of it organized around personalities.

Re: United States loses AAA credit rating from S&P

#407

Post by jballanc » Sat, Aug 06, 2011, 4:43 PM UTC

The true shame is not loosing some arbitrary rating from some arbitrary organization, but that this action still matters even after said organization was shown, conclusively, to behave in a completely arbitrary and ultimately self-serving way.

Re: United States loses AAA credit rating from S&P

#408

Post by stcredzero » Sat, Aug 06, 2011, 4:45 PM UTC

jerf wrote: post #90

j_hightower wrote: post #80

Earlier quoted context omitted.

"Given China's rise, its wise long-term to keep a presence in the region." Why? China will surpass the United States in soft and hard power eventually. This is demographically and economically inevitable. Even sooner, if not already, China will become an unshakable hegemon over all of Asia. So why fight it in the most expensive and futile ways possible, i.e., by maintaining the fiction that we will be able to exercis…

"This is demographically and economically inevitable." Oh, no it's not. First China has to hold together over that time frame. This is feasible... this is not inevitable . There's a lot of tensions over there. Then even if they pass that test, there's other things they're going to have to deal with. Right now, there isn't a single world power that's looking to be "inevitably powerful" in the next 50 years, it's reall…

First China has to hold together over that time frame. This is feasible... this is not inevitable. There's a lot of tensions over there. Then even if they pass that test, there's other things they're going to have to deal with.

Right. It's entirely possible that China can hold together as a sovereign nation, but will develop or hold onto pathologies which will cripple it as a major power. Then again, the same could also be said for other potential powerhouses like Brazil, Russia, and India. The same could even be said for the EU and the US.

Re: United States loses AAA credit rating from S&P

#409

Post by bubbleRefuge » Sat, Aug 06, 2011, 4:48 PM UTC

cookiecaper wrote: post #390

jlangenauer wrote: post #385

Earlier quoted context omitted.

As opposed to forced retirement accounts you manage yourself? Make no mistake, no sane government would allow for completely voluntary contributions to any sort of pension or superannuation scheme - it'd be setting its country up for a massive economic and social timebomb as the majority of the population put present wants over future needs. As for investing pensions in the stock market, I'll merely add that in Austr…

I strongly disagree that retirement accounts should be mandated by the government. If people won't save for retirement, they should understand that the government can't help them. This philosophy that the peon is too stupid and/or undisciplined to manage his own accounts and that the government must protect him from himself is what gets us into huge messes like this in the first place.

Actually retirement accounts are demand leakages. For example quantity theory of money gives us MV=PY money * velocity = prices * quantity of goods/services produced. So if money is squirreled away in retirement accounts it is no longer circulating in the economy and in order to maintain the same level of economic activity we have to 'make up' for the lost M. So retirement accounts are a drag on the economy.

Re: United States loses AAA credit rating from S&P

#410

Post by stcredzero » Sat, Aug 06, 2011, 4:55 PM UTC

encoderer wrote: post #367

forgottenpaswrd wrote: post #355

Earlier quoted context omitted.

"The US is rich for the same reason Rome, England, and Spain were" Not really, have you been in England, Rome or Spain? Rome legionaries were used to make roads and bridges and mining 90%of their time. If I show you the extensions of the land they "washed" to get mineral you won't believe it(you can see it using google earth, e.g in the north of spain, look for grooves around mountains). England made itself rich beca…

Where do you think the money goes ? Military spending is still government spending. It's going to contractors, vendors and soldiers. They are, respectively: making jobs and selling to everybody (not just the gov't), and buying cars and houses.

Sounds like something straight out of Orwell's 1984? The economy is based on ridiculous spending my the military, which enables companies to write paychecks to facilitate consumer spending at home. So basically, our way of life depends on finding excuses to go off and kill people, which in turn justifies our military-industrial complex.