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OLD-ORDER MINDSET of continuous growth ?

AS The United states is on course to topple over the "fiscal cliff" while

Democrats and Republicans reached the broad outlines of a deal but

failed to pass the required legislation in time.

"The fiscal cliff was concocted by President Obama and Congress as a way of holding

a gun to their own heads. The fixing of a deadline for the automatic imposition of

ferocious tax rises and deep spending cuts was supposed to concentrate the minds of

America’s political leaders and force them into taking the difficult decisions required

to start reeling in the country’s truly terrifying levels of public debt.

The stratagem has failed. There has been no “grand bargain” that addresses the root

causes of the ballooning deficit – rocketing social security entitlements funded by a

too-narrow tax base – just a sticking-plaster settlement aimed at buying more time.

The detail of the deal, agreed by the Senate two hours after the deadline’s expiry,

reveals its lack of ambition. The income tax rate will rise from 35% to 39.6% on

individual incomes over $400,000 (just under £250,000) while various deductions and

credits will be withdrawn on lower incomes. AND that WAS IT. There was scarcely a

mention of spending cuts of any kind. Given that the United States has a $16 trillion

burden of debt and an annual budget deficit of $1.1 trillion, this package does NOT

even begin to address the fiscal crisis.

THIS refusal to face up to reality is damaging enough in the eurozone.

In the United States it is infinitely more so. As the powerhouse of the world economy,

America cannot continue to live in denial and expect to maintain its dominant role.

Its current debt trajectory is leading the country to ruination. US public debt is already

close to three quarters of GDP; official figures indicate that this will rise to 90 % by the

end of the decade.

Many economists believe that such a crippling level of public debt

can destroy any prospect of economic growth."

AS one meritorious Professor of Geophysical and Climate hazards

has said in SKY VISION's - Superstorm 2012: Hell and High Water

"The ONLY way we can prevent climate change from being 
all pervasive , being catastrophic , IS by a war on climate change - 
INSTEAD of economic growth being what we really want to achieve -
IT should be reducing emissions."
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                                                                 Bill McGuire - University College London
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Views: 44

Comment by Michael Grove on January 10, 2013 at 23:04

Most of us would view a monetary experiment which has led directly to the bankruptcy of entire countries, and the ruination of so many lives, as an unqualified failure. BUT the European political class is determined to retain its insane financial architecture, regardless of human considerations. From this side of the Channel, we must continue to muddle along in our boring, matter-of-fact way: to hope that it all works out for the best, while making prudent provision in case it does not.

Comment by Michael Grove on January 27, 2013 at 11:57

WHAT IF Nassim Taleb's "Black Swans" were engineered by a group of men -

living together in society today - as a result of information asymmetry ?

" When plunder becomes a way of life for a group of men living together in society - they create for themselves, in the course of time, a legal system that authorises it and a moral code that glorifies it "

                                                                                                                Frederik Bostiak

 

 

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