How Does A Country As Rich As Ours Go Broke?

[ThomWV]

The United States, contiguous if you like but even more-so if you include Alaska, Hawaii, and our possessions, is an incredibly rich nation. We have oil, we have minerals, we have ores of every kind, we have forests, and we have a well educated and basically law abiding populace. We have relatively low taxes and one of the world's highest outputs per worker. We have an outstanding system of roads, the world's finest communications. We have no enemies who can seriously threaten us and good relations with neighboring countries. Some someone explain to me how we go broke.

[MethuenProgressive]

1. By electing Republicans.

Voodoo economics.

[ElsewheresDaughter]

9. ditto that ^

[focusfan]

21. It`s a no brainer spend more than you take-in,you go broke

Even a bottomless pit has a bottom somewhere,it also depends on how far you fall as to how hard you hit.:toast:

[focusfan]

39. hey i agree with you 100%

they waste a lot of money

[JohnyCanuck]

2. Here's how:

www.moneyasdebt.net

http://video.google.com/videoplay?docid=-9050474362583451279

[Phred42]

13. Excellent! Thanks - CLICK THIS POST = WATCH THIS MOVIE

I was not even aware of this movie - thanks again

[JohnyCanuck]

24. A word from the producer of "Money As Debt"

Money created as interest-bearing bank credit is a magic trick, a fraud - now 3 centuries old; one that very few people have seen through despite, or rather because of, its utter simplicity.

It is my intention to make this mysterious debt-money system comprehensible to everyone. It is also my intention to foster sufficient understanding of the problems with this money system that citizens will be motivated to join the monetary reform movement and/or create local alternatives to the global monetary system - a system in which most of the productive people of the world are collectively chained to an ever-increasing and perpetually unpayable debt.

This is a system designed for elite control of the people by those who have given themselves the privilege of creating money. It is also, I believe, a system that is designed for catastrophe. As the movie explains, there can be no sustainable civilization without a sustainable money system.

http://paulgrignon.netfirms.com/MoneyasDebt/ProducersComments.html

[Phred42]

37. Thanks Again! This is going out to everyone I know.

[JohnyCanuck]

51. If "Money as Debt" tweaked your interest,

check out "The Money Masters" videos on Google video for a more in depth look at the history of banking and the bankers' efforts down through history to manipulate kings, prime ministers and presidents in their efforts to ensure they could retain control of the money creation process in Europe and the USA.

Money Masters Part 1 (2 hrs)
http://video.google.com/videoplay?docid=-1583154561904832383

Money Masters Part 2 (1hr 46min)
http://video.google.com/videoplay?docid=-7336845760512239683

They're a bit on the long side but well worth it for the history lesson.

'Since I entered politics, I have chiefly had men's views confided to me privately. Some of the biggest men in the United States, in the Field of commerce and manufacture, are afraid of something. They know that there is a power somewhere so organized, so subtle, so watchful, so interlocked, so complete, so pervasive, that they better not speak above their breath when they speak in condemnation of it.'

-- Woodrow Wilson, The New Freedom (1913)
http://en.wikiquote.org/wiki/Woodrow_Wilson

The powers of financial capitalism had another far reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements, arrived at in frequent private meetings and conferences. The apex of the system was the Bank for International Settlements in Basle, Switzerland, a private bank owned and controlled by the worlds' central banks which were themselves private corporations. The growth of financial capitalism made possible a centralization of world economic control and use of this power for the direct benefit of financiers and the indirect injury of all other economic groups."

Tragedy and Hope: A History of The World in Our Time (Macmillan Company, 1966) by Professor Carroll Quigley of Georgetown University, (Highly regarded by his former student, former US President, Bill Clinton, see: http://en.wikipedia.org/wiki/Carroll_Quigley )

[erinlough]

63. Thank you for this information

I am in a position to invest or get out from under all debt. You just helped me make up my mind. I want off the roller-coaster of debt once and for all. The banks, who have my money, are very persistant about how I am making a mistake paying off debt rather than investing. I now understand why.

Really, thank you.

[ixion]

3. corrupt politicians

that's all the explanation required. They hold the purse strings, and dole out money to their buddies at our expense.

[unhappycamper]

4. Empire is expensive.

Three quarters of a trillion dollars on the war machine (on the credit card) adds up.

[Selatius]

5. When it has no money. We are borrowing now to maintain the current standard of living.

When you examine credit card debt and people who take out equity from their homes to maintain current living standards and people who run up debt on luxury items like plasma flatpanel TVs, you come to one of two conclusions. 1) People are materialistic and are living beyond their means. 2) Wages haven't kept up with inflation, yet people still want to maintain their standard of living or, God forbid, want to "keep up with the Joneses."

You should count natural resources and land as separate from money. If you cannot transform any of that into money, you can't do business with anybody else who does business with money. You would have to borrow until you can transform enough of it to money or go back to bartering.

If you want to talk about why wages haven't kept up with inflation, you're really talking about confronting the banks and the businesses that profit at the expense of workers when inflation cuts the wages of their own workers. You've then got a problem with people seeking more profit, then, and that it needs to be resolved.

[JanMichael]

6. Greed

sucks up wealth pretty quickly.

[Demeter]

7. On the Other Hand--Knowing Where It Went, We Can Get It Back

with judicious taxing, prosecution, and confiscation of the assets of the criminals who stole it.

[Skittles]

55. BINGO!!!!!

sheer f***ing greediness - nothing is ever enough

[Rosemary2205]

8. Donald Trump went bankrupt

all you have to do is have more in obligations than take in for a long enough period of time.

[Angela Shelley]

10. More, more, more!

[lpbk2713]

11. In a word --- mismanagement.

Our country was in the inept hands of the corrupt BushCo regime for the past seven years and their rethuglican co-conspirators owned all three branches of government for at least those same seven years. It was like they were given the keys to the candy factory. They pillaged and plundered like there was no tomorrow. Now they want to point fingers and look the other way like it was someone else's fault. I can't wait till January '09 so they can start to be held legally accountable. We will have to construct new prisons to hold them all.

[Possumpoint]

17. The Mismanagement

you refer to started from 1913 and The 16th Amendment to our constitution. We have lost the ability to control the politicians we elect. By creating the federal reserve and the ability to borrow, tax and print money at will, we gave them a blank check to do as they wish. FDR choose to confiscate privately owned gold during the depression and made it illegal to have private ownership. Nixon took us off of the silver standard and had us start using Federal reserve notes. These are backed by a promise only. Our elected politicians realized that they could spend what they wanted, when they wanted. They began to buy our votes on a grand scale. That "Good Will" was to get us to re-elect them. Deficit spending has been endorsed by politicians to varying degrees, from both sides of the isle. Why else would there be earmarks and so much pork added to the federal budget?

That practice continues to this day and includes the new stimulus package. The stated purpose is to stimulate domestic production and retail. There is very little domestic production left. Since our government practices deficit spending, we are in effect borrowing that money from the Chinese and others to in turn buy their and other's goods while our government goes further into debt. Whose economy are we stimulating anyway?

If you really want things to change then the American voters must demand a balanced budget and a pay down of debt. That includes any new promises made by candidates of either party. We must ask the question "How are we going to pay for it"?

That would be a very painful process but we must let the chips fall where they may. In particular, corporations doing business in the United States must start carrying their fair share. Their lobbyists however, work very hard to avoid this. The Republican practice of protecting corporate interests over all others must be curtailed. Corporate tax havens must be abolished.

[lutefisk]

38. I agree, except for the part about BushCo being held accountable

They will never be held accountable. Is Clinton or Obama or McCain going to hold BushCo accountable for stealing the country blind? I don't think so.

[dysfunctional press]

12. military spending on building/maintaining our empire...

which goes WAY beyond the 50 states, is THE problem.

[paparush]

14. Lets start with $600+ BILLION spent on the Military

That's only the part that makes it into the public budget. We'll never know how much is spent on black list items.

United States  	$623 billion  	FY08 budget 
China 	       $65.0 billion 	2004 
Russia 	       $50.0 billion 	
France 	       $45.0 billion 	2005
United Kingdom $42.8 billion 	2005 est.
Japan 	       $41.75 billion 	2007
Germany        $35.1 billion 	2003
Italy 	       $28.2 billion 	2003
South Korea    $21.1 billion 	2003 est.
India 	       $19.0 billion 	2005 est.
Saudi Arabia   $18.0 billion 	2005 est.
Australia      $16.9 billion 	2006
Turkey 	       $12.2 billion 	2003
Brazil 	        $9.9 billion 	2005 est.
Spain 	        $9.9 billion 	2003
Canada 	        $9.8 billion 	2003

[indepat]

15. Bingo, and in consonance with 'pukes unwillingness to extract taxes from those who have the largest

incomes/wealth, i.e., large corporations and the most affluent, at a rate they willingly and gladly tax the middle income, the Federal debt has gone up eightfold in just a quarter century. But there's a silver lining to all this: trillions of dollars of Federal debt now repose as wealth among the wealthiest.

Edited to make complete sentence

[davekriss]

20. That is one of the biggest problems

We don't need to spend over a half a trillion yearly to protect ourselves from 19 men with boxcutters hijacking planes. That's like building new generations of ICBM to come down on traffic violations. "Terrorism" is being used to redirect current and future tax flows into the coffers of a few select industries, the military-industrialist complex Eisenhower warned us about. The first thing President Democrat must do is dramitically slash this budget set aside for empire building.

[KansDem]

28. "Terrorism" is being used to redirect current and future tax flows..."

...into the coffers of a few select industries."

"Terrorism" has replaced "communism." Communism had been the big bogeyman since WWII: when the Berlin Wall came down in 1989, there was no bogeyman. Then came the WTC attack in 1993, and terrorism became the new bogeyman. It's the "same old same old."

[HawkerHurricane]

16. History repeats itself

What historians never tell you is that the first time it's a tragedy, the second time it's a farce.

In the 1500's, Spain was the richest country in Europe. Vast wealth (stolen) from the New World enabled them to hire mercenary armies to dominate the other countries. Unfortunately, they hired more troops than this years income. So they borrowed off of the gold that would come in next year. Eventually, they owed more gold than they could ship in from the Americas...
(That a bunch of pirates and Englishmen were stealing what they could, and the natives kept on revolting over thier treatment didn't help thier economy. But the basic problem was spending more then they were taking in.)

[pretzel4gore]

18. tapeworms prefer well fed couch taters...

there's a story if you hold a cheesey pop just in front of your mouth, the tapeworm silently exits and threadlike locks onto the cheesey pop, which you then eat without realizing (apparently, tapeworm infested peoples' friends have seen this happen, to their horrified revulsion)
america's got tapeworms (rightwing reactionaries)
note: tapeworm infestations are fatal if left too long...the host literally starves to death, though it's gobbling down steak and potatoes etc as fast as he can shovel it in!
also: tapeworms hate marajuwanna (causes too much reflection)

[DFW]

19. Do the math

If you take home $50,000 and can live on $45,000 you don't go broke.

If you take home $1,000,000 and "need" $1,100,000 to live one, you go broke.

It's not how rich you are, it's whether or not you spend more than you have.

If we take in ten trillion dollars a year as a nation, but spend eleven trillion
because Cheneybush wants to play war games in Asia, then we go broke, especially
when the countries who lent us the extra trillion want to be paid back.

[leftofthedial]

22. greed, ignorance, putting repukes in power

when you put thieves in charge of the treasury and the budget, you're pretty much guaranteed to be broke

raybun, george the first and king george all prove it


also, sadly, "outstanding system of roads, the world's finest communications" is not true. Our infrastructure is crumbling after a generation of repuke neglect and all of Europe and most of developing Asia have far better communications systems than we do, including faster and more ubiquitous broadband and better cell phone service. We are on the brink of becoming a third world country--a bigger Mexico.

[Tierra_y_Libertad]

23. By electing "leaders" instead of servants.

See Lord Acton's axiom for the rest of the story.

[Akoto]

25. Simple!

1. Have a warhawk as a leader.

2. Start wars when we don't have to.

3. Cut the taxes that'd normally pay for those wars.

4. LOSE PROFIT!

[notadmblnd]

26. The pukes steal it

the start up businesses, get no bid contracts from the government, that we as tax payers pay for. They do cheap, shoddy work if any at all, and then they put the rest of the cash in their offshore accounts.

Viola! The US is broke.

[Jack Rabbit]

27. Three easy steps

1. Send as many jobs overseas as possible.
2. Cut wages and salaries for those in the working and middle classes who still have jobs.
3. Most important, persuade them that they don't need money to buy things, including homes.

[KG]

29. by shipping its wealth overseas.

[Faux pas]

30. Uh, we've been robbed? Outsourcing, debt to China, war without

the 'real' money to back it, not using our own oil.....there's more of course, but I figure that's enough to get the point across.

[El Pinko]

44. Robbed? We voted for repugs and repug-like dems, shopped at Wal-mart, voted for "tax cuts"

NAFTA, you name it, we as citizens all sat by idly as our government and corporate class sold off our manufacturing base and our jobs for dimes on the dollar, and just kept charging our rising expense on the credit cards.

How do we complain that we were robbed if we were so passive in letting it happen before our very eyes?

[Faux pas]

53. I never voted for a thug, a thug lite or tax cuts. I've been to

Wal-mart exactly one (1) time back in the 90's and I don't do credit cards. Guess your theory doesn't work in my case. Passive? We've been f-ing clueless, kept in the dark and lied to, sorry, I can't take responsibility for that either.

[El Pinko]

54. Obviously we *ALL* didn't do it. Neither did I.

But I remember when EVERYONE seemed to just LOVE St. Ronnie (I guess many still do, the way the GOP keeps rolling out his corpse to worship), and during his first term, Dumbya had soaring approval ratings, despite handling everything from 9-11 to the economy atrociously.

I was obviously speaking of the American public as a whole. Ignorance and apathy have become completely acceptable now.

[Romulox]

31. How do you figure a country can spend twice what it produces

and remain wealthy? This is basic numeracy.

[ileus]

32. the Government wastes more money than george bush has told lies.

[coalition_unwilling]

33. The military industrial congressional media complex redistributes

wealth from the commons to rentiers and haute bourgeoisie through imperialist adventurism and resultant crony capitalism.

The wealth is still here but has been redistributed.

[coalition_unwilling]

34. On edit: Another redistributive tool is cutting marginal tax rates

on the wealthy, using whatever 'voodoo economics' makes sense at the moment. BFEE's initial round of tax cuts gave almost 50% of the benefits to the top 1% of the population.

[Solon]

35. By living above our means...

If you go into deficit spending, its inevitable that the bill collectors will start to come knocking.

[conning]

36. Energy is the key variable.

And most particularly the fantastic energy of petroleum. At one point in our history we had lots of it and we developed ways to take advantage of it. However, our petroleum capacity peaked in 1970 at a little over 10 million barrels a day. Now, even with Alaska and the Gulf of Mexico, we are down to about 5 millions barrels a day. We are currently using 21 millions barrels a day.

So much of our decline can be understood in relation to the decline of our once abundant petroleum resources.

[Rex]

40. Greed.

[Fly by night]

41. Rethugs who steal elections also steal everything else that isn't nailed down.

Then they pimp Lady Liberty to the Chinese.

[awoke_in_2003]

42. Lot's of good points here

but one I haven't seen yet is- all those natural resources do not belong to the american public. They belong to a few rich individuals/companies. The public in general does not profit much from them.

[El Pinko]

43. Is a family making minimum wage living in a mansion financed by credit cards & subprime debt "RICH"

I would say no. But that's what the US is and has been for years, starting with Reagan, but the deterioration of the US's finances has been much faster and more severe under POS Bush.

I understand what you're saying about resources, but resources don't make a country rich. If they did, Africa would be rish beyond avarice.

It takes a good manufacturing base and production of value-added products (including intellectual property, etc.) to make a strong, prosperous economy. Importing mountains of cheap crap from China doesn't do the trick, neither does brainwashing working-class peons into taking out subprime loans to buy $500K houses to flip.

The US is not a rich country anymore. It's circa-2002 Argentina with a big military. People just don't realize it yet.

[Fire Walk With Me]

45. Why do fish whose guts are sucked out by Lampreys die?

:shrug:

[sandyd921]

46. We elect repubs who bleed us dry!

The trick now will be to repatriate our money from the uber-wealthy and the corporations who have stolen it. :argh:

[YvonneCa]

47. We had a surplus...

...in 1999. Then Bush arrived.

[juajen]

48. That's easy. Answer: The Pirates of the Potomic

NT

[havocmom]

49. .

[Lydia Leftcoast]

50. 1) Having a bigger and more expensive military than the rest of the world combined

2) Letting corporations outsource our manufacturing jobs overseas so that a) blue collar workers' real incomes drop and b) we have to import most of the stuff that we used to make, which
3) Forces workers to buy things on credit to survive, and
4) Worsens our trade deficit. (Figures I saw years ago said that 1/3 of our trade deficit was U.S. companies importing finished goods from their overseas contractors.)

[Stinky The Clown]

52. Two Words: Unfettered Republicanism™

No people can endure more than a few years of it without deterioration of the fundamentals of civil society.

[JCMach1]

56. Because even the Dems drank the Milton Friedman Koolaid

[Zorra]

57. The fascist elite stole all the money for themselves and their fascist friends.

It's simply a case of greed and meglomania combined with an absolute sense of entitlement.

[DCKit]

58. BFEE n/t

[thoughtcrime1984]

59. By using the Federal gov't to launder money to corporations

Thanks W and Evildick!

[Mike03]

60. Great Question

I don't have the answer; however, it seems to me that it has been a combination of factors:

1. Years and years of easy credit made available to people in order to keep up the appearance of a growing economy.

2. Consolidation of great wealth among a very tiny fraction of a percentage of our population.

3. Maybe most importantly, incredibly poor decision-making by our leadership on how we should use (read: squander) our precious national treasure, particularly in Iraq, but also for the foreseeable future as we repair the damage to human beings caused by the Iraq war in the first place.

4. The natural consequence of national borrowing is that we now have to sell off our most valuable assets to the nations we owe money to. This is why nations in the East and Middle East are buying up our corporations, ports, real estate and are major investors in our markets.

I'm probably missing many other angles on this--this is probably just the tip of the iceberg.

ON EDIT, and P.S.:

You have really written some challenging and thought provoking posts here recently. I really enjoy reading them, and also the responses to them.

[ThomWV]

62. Thank you. That was an awfully nice thing to say and I appreciate it.

Really, you made me blush.

Thank you.

Thom

[Festivito]

61. Living beyond our means while half of US vote this as conservative.

The rest is just details.