Automation

[ShaunyP26]

I'm making neither case. I'm talking about the Feral Government borrowing money and making me and every other tax payer pay it back with no benefit to us from whatever the Feral Government spent the borrowed money(and taxes) on such as bridges and roads to nowhere, money spent in support of failing and/or un-self-sustainable business, and programs like NPR, NEA, etc.

Woody

So you just have a moral aversion to debt then, even if it leads to greater growth and wealth for the country in the long run???

It doesn't always have to be paid back though. Under the right circumstances it could be rolled over and extended forever. (The Bank of England, as an example, has a perpetual bond it owes that has been outstanding since the 1600's. Demand for US treasuries from foreigners and our own households is sky high right now. What's wrong with taking advantage of that and investing in our country and its people? That's exactly why Trump treasury appointee Steve Mnuchin has floated the idea of bonds with the idea of issuing treasuries with durations of 50-100 years.

 

[ConstitutionCowboy]

So you just have a moral aversion to debt then, even if it leads to greater growth and wealth for the country in the long run???

Greater growth and wealth derived from debt will have to be proven to me. Greater growth and wealth has to be earned - if it is to last.

It doesn't always have to be paid back though. Under the right circumstances it could be rolled over and extended forever. (The Bank of England, as an example, has a perpetual bond it owes that has been outstanding since the 1600's. Demand for US treasuries from foreigners and our own households is sky high right now. What's wrong with taking advantage of that and investing in our country and its people? That's exactly why Trump treasury appointee Steve Mnuchin has floated the idea of bonds with the idea of issuing treasuries with durations of 50-100 years.

Ah, but the interest has to be paid. That is a debt burden that can't be put off. Even with a maturity 50 to 100 years down the road, someone will have to fork over the taxes required by the government to pay off that debt, like maybe our kids and grandkids.

Woody

 

[ShaunyP26]

Greater growth and wealth derived from debt will have to be proven to me. Greater growth and wealth has to be earned - if it is to last.



Ah, but the interest has to be paid. That is a debt burden that can't be put off. Even with a maturity 50 to 100 years down the road, someone will have to fork over the taxes required by the government to pay off that debt, like maybe our kids and grandkids.

Woody

Yes, but you also forget that a majority of US households, businesses, and other government agencies even are active lenders to the US government so it's also a source of wealth to Americans too. We don't owe all our debt to foreigners. (Not even close.) We mostly just owe it to ourselves, so it nets out. This is why the US government is not equivalent to a household. Only foreign ownership counts as a drain on overall national wealth.

This should help clear it up.

https://www.thebalance.com/who-owns-the-u-s-national-debt-3306124

 

[ConstitutionCowboy]

I understand all of that, but it is still borrowed money; money that the government has spent. It's money that will not net a profit. It is nothing more than a Ponzi scheme. Bottom line, it is called 'debt.' It is debt.

It always cost Joe Blow and me more to borrow money from a bank than we can earn by lending it to a bank. Banks make their profit on the difference. If we do something prudent with the money we borrow, we can make more with it than it cost to pay back the principle with interest. I've yet to see government make more money with the money it borrows. All government can do is charge us more in taxes to cover its cost of borrowing. We would be better off with government that only spent what it took in and leave the growth and prosperity in the private sector where it belongs.

Woody

 

[ShaunyP26]

We would be better off with government that only spent what it took in and leave the growth and prosperity in the private sector where it belongs.

Woody

This is literally impossible, because business cycles are volatile and hard as hell to forecast. The exact revenue that can be brought in down the road is fundamentally unknowable unless the exact spending and investment that the private sector is always known at the exact moment and every moment into the future.

I'm sorry, but that view is just incorrect from a technical standpoint, not a political one. Even households and private business aren't that good at predicting their future income and profits. Debt exists for this very reason.

 

[ShaunyP26]

In fact, government saving and private sector saving are mirror opposites of each other. One can't save (reduce debt or stockpile cash) without the other dissaving (borrowing money) This is a mechanical process divorced from politics. Increased private sector saving leads to a fall in revenues, which leads to a rise in government dissaving (borrowing). The irony is that the desire to lend the government money increases the most when the private sector is saving, which lowers government borrowing costs.

This is an extremely underappreciated dynamic.

 

[ConstitutionCowboy]

This is literally impossible, because business cycles are volatile and hard as hell to forecast. The exact revenue that can be brought in down the road is fundamentally unknowable unless the exact spending and investment that the private sector is always known at the exact moment and every moment into the future.

I'm sorry, but that view is just incorrect from a technical standpoint, not a political one. Even households and private business aren't that good at predicting their future income and profits. Debt exists for this very reason.

There is this thing called "risk.' It's something entrepreneurs face up front and deal with and when the market likes what the entrepreneurs have put forth, risk leads to profit. Banks take risks with entrepreneurs all the time. Some win, some lose. Being in debt does not guarantee success. If it did, everyone who decided to "take a risk" would be in debt. Debt will not carry one through the lean times. Reserves will, but not debt.

I took on debt twice with my first business. When the business field I was in took a dive, my business couldn't meet its debt obligations and I had to shut it down and liquidate to clear the debt. Never again. I didn't go into business again until I had what I needed up front. I've been successful ever since. I have been able to flex with the markets and stay afloat even though at times the business had nothing on the P&L for sometimes several months because I had no debt.

Debt is a chain around the neck of any business or family - or the people living under a government in debt.

Back to the topic at hand, even now in my little home based business, I employ a modicum of automation. It helps me produce in two weeks that which took several months when I first started. My little bit of automation didn't replace me. It made me more productive.

Woody

 

[ShaunyP26]

There is this thing called "risk.' It's something entrepreneurs face up front and deal with and when the market likes what the entrepreneurs have put forth, risk leads to profit. Banks take risks with entrepreneurs all the time. Some win, some lose. Being in debt does not guarantee success. If it did, everyone who decided to "take a risk" would be in debt. Debt will not carry one through the lean times. Reserves will, but not debt.

I took on debt twice with my first business. When the business field I was in took a dive, my business couldn't meet its debt obligations and I had to shut it down and liquidate to clear the debt. Never again. I didn't go into business again until I had what I needed up front. I've been successful ever since. I have been able to flex with the markets and stay afloat even though at times the business had nothing on the P&L for sometimes several months because I had no debt.

Debt is a chain around the neck of any business or family - or the people living under a government in debt.

Back to the topic at hand, even now in my little home based business, I employ a modicum of automation. It helps me produce in two weeks that which took several months when I first started. My little bit of automation didn't replace me. It made me more productive.

Woody

Debt is money. That dollar in your wallet is a liability to the fed. Every asset has some type of liability to offset it, either debt or equity. This is just accounting. Even that bank deposit you have represents a liability to you from the bank. Do you do a balance sheet for your business? Look at it.

I'm sorry and I mean no disrespect, but you're absolutely wrong on a purely technical level when describing debt. You're making a moral case and trying to pass it off as an economic or financial one.

 

[ShaunyP26]

Back to the topic at hand, even now in my little home based business, I employ a modicum of automation. It helps me produce in two weeks that which took several months when I first started. My little bit of automation didn't replace me. It made me more productive.

Woody

I'm sorry about your business. My uncle was left in ruins from a machine shop he owned, but it was mostly on him for improperly managing his debt.

I'm not bashing automation in general. Yes it does make people more productive, but it can also displace many people and cause lots of pain.

Like I said, automation is not a growth or societal wealth problem, it's an income distribution problem. It is simultaneously possible to become wealthier as a nation, while more and more people become worse off. This is the very essesence of what people talk about when they discuss income inequality.

 

[dennishoddy]

This is the very essesence of what people talk about when they discuss income inequality.

I'm going to have to disagree.
In your world of perfect analysis of every situation, this might be true, but when you drill down to the Baltimore, South Chicago, etc level, that is not their idea of wealth redistribution and the liberal progressive party agrees with that demographic, not yours.
They bait the demographic with the "rich white man" that takes your money and here you are in poverty because of that. Only the liberal party that needs your vote to "fix" this is here to "help" you, yet they never help.
DC, Baltimore are still the same as they ever were, and getting worse under democratic progressive leadership.
This country is where it is at because of automation. Had we not progressed from knapping flint to Nuclear physics because of automation where would we be today? You cannot progress in the workplace or progress as a nation without automation.