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Jay Hallen
The Argentina Scenario « Back to Story

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The dangerous electoral tipping point may have just passed. Those who have the talent, education, and foresight should perhaps make plans to escape. Those among the elite who are sufficiently unscrupulous will want to ride the wave of decline to wealth an power, but they will theereby, damn their descendants. America, America...god!
An interesting thread. Thank you to all, on both sides. One thing that strikes me is how often the most critical remarks made by people of a bold proposition -- whether it make sense or not -- come from those hiding behind pseudonyms.
Excellent artcile. I did a quick (back-of-the-envelope) calculation; so, I am not confident about the number but convinced by its degree. If the tax paid by the top 1% were held constant and the deficit eliminated, the burden would be 15% for the top 1% (not bad) but would entail a tax hike of something like 3x for the rest of us. So, that places spending cuts into perspective.

While the '47%' remark was not pleasant yet demagogued, I have come to believe that the intensity of the reaction against it reflected a possible fact that Governor Romney had stumbled onto the real third-rail of U.S. politics: a growing underclass with behaviors reinforced (into a subculture) by policies dating back for fifty years.

Thank you, Jay (and Manhattan Institute), for bringing this challenge to people's attention.
Thomas,

Sweden did in the mid-2000s some cuts to their budget and here an article about Swedish myths and realities.
http://reason.com/reasontv/2008/08/06/swedish-myths-and-realities
Attention to facts, here, is observed in the absence. Ideology does lead to this problem. For example:

-- The one example of "government picking winners" is the auto industry. Obama picked the auto industry and assured that GM and Chrysler would survive.

-- The "loses $49,000 a car" for the Volt is based on amortizing the R&D costs and plant building costs over a very short production horizon.

Want a depression? Try to do laissez faire at a point where you've reached a major Balance Sheet Recession. Republicans go on, not reading Richard Koo and not understanding how the capitalist system works when slammed with debt.
There is a lot of truth in this article particulary about Argentina where I have just spent 3 weeks but there is also a lot of glossing over the role played by the Bush regime in turning a budget surplus situation into a huge deficit by his economically illiterate starting two wars while cutting taxes for his rich mates -a situation Obama has inherited
There is also the well known US myopia at work that thinks the US is ahead of the world in all areas
As someone who has traveled to all six continents (including three times to the US) I am here to say "not so" The Scandinavian countries have much higher taxation than the US but higher standards of living, health and welfare
How does his right wing rhetoric explain that ?
You can NEVER underestimate the "professor" mentality of guys like Obama. They have this view of history and industrial concerns that have nothing to do with reality. Unfortunately, if these guys do leave the college campus, they go into law, journalism or politics. I see this attitude with 35 year old reporters for the TAMPA BAY TIMES. A guy who is interested in environmental paganism is an expert on the oil business inside of two weeks since he started writing about the Deepwater Horizon incident. He absolutely is convinced he is better suited to run ExxonMobil than all the retired CEO's of all the oil companies that have ever lived. These executives are just part of the problem to this left wing reporter. They are NEVER part of the solution. The Obama admistration is full of people with this attitude. A few technocrats that are driven by personal problems and a Federal government run by zealots for a few years and you can ruin a productive economy.
A public health service does give universal health care, look at the NHS. The problem is there is no limit to what needs to be spent to keep people health, with no restrictions queues build up or as they are called in the UK "waiting lists" some for several years.
When you say affordable prices, a family friend is a GP, here in Australia. Mothers will pay $120 for their hair do every three months, ask for $40 to see there sick kids and it isn't affordable with all the other bills. Also our friend works as low rates in a low socio-economic area and the number of people who are obese, have alcohol related fatty livers, chloresterol or other self inflicted conditions is frightening.
Enrique Prieto Castillo November 04, 2012 at 12:48 PM
Obama's economic policy is similar to that made J.. Rodríguez Zapatero in Spain. Today we have in Spain 25 percent unemployment, and ruined the country. That political demagogue, populist and irresponsible is dangerous for citizens, families and companies.
Enrique Prieto Castillo November 04, 2012 at 12:46 PM
Obama's economic policy is similar to that made J.. Rodríguez Zapatero in Spain. Today we have in Spain 25 percent unemployment, and ruined the country. That political demagogue, populist and irresponsible is dangerous for citizens, families and companies.
An excellent piece which throws into clear relief what so many make murky and complicated. Straightforward and simple. Thanks, Mr. Hallen
What about the corruption that reigned in Argentina you have failed to mentioned above. That is not a factor in the USA economy. And really - is money the only thing that can be used as a projection of a countries success. There are many solutions to people's happiness that can be found through the over inflated non-economic pathways.
Don't have to read very far to recognize that this is a stupid article.
The writer doesn't understand what really sank Argentina, which has no resemblance to the US.
"the so-called free market is massively failing to provide the services everyone needs at an affordable price (and it cannot even in theory, because buying health care isn't like buying shoes). This has been clear for decades -- people are suffering from it, and dying." David Apell.
You must be kidding. You really think anybody who is suffering and dying now, would not have been 20 or 40 years ago. What a joke.
News flash: humans have been suffering and dying since before the USA even existed, and they will continue to do so. Thus far, we have only extended lifetimes.
Democracy is more dangerouse than dictatorship, when idiots, lazy, weak, poore and enviouse prevail on industrious and responsible. Ancient Greese went down by same reason. Is it destiny of all democracies?
While I hate to be the pessimist, this warning is too late. The top ten percent of taxpayers pay 70 per cent of the income tax. There is no turning back from the restribution policy set in motion in the 40's. Like the peasantry of South America, the non-taxpayer will cry for more and more. Soon the gini-coefficeint will reflect the perverse nature of envy politics with the federal govt workers and their gold plated pensions at the top and everone else huddled at the bottom. On the road to sefdom we go.
"Economic policy has become increasingly overrun by central planning, redistribution, and government picking of industrial winners and losers."

WTF??

the gini coefficient for the USA has never been GREATER-the wealth transfer from the 99% to the 1%.......and the author claims the country is mired in 'redistribution'!!

And Argentina's 'diligent immigrant workforce' were Italians, who came to get rich quick, and couldn't wait to return to the Old Country.

This is a hack piece, by a 'certifiable' writer.

More in inequality:

http://www.nakedcapitalism.com/2012/11/desperate-effort-by-tyler-cowen-and-megan-mcardle-to-silence-discussion-about-income-inequality.html
If pollution were properly priced, there'd be no need for government to be picking winners and losers. But it is not -- carbon pollution, in particular, is the biggest market failure in history.

Similarly for US health care -- the so-called free market is massively failing to provide the services everyone needs at an affordable price (and it cannot even in theory, because buying health care isn't like buying shoes). This has been clear for decades -- people are suffering from it, and dying. Hence another need for government to correct this market failure.

Ideologues like the author care more about "the market" than they do about actual people.