• Category Archives Socialism

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    This post was published at Harvey Organ Blog on September 22, 2017.

  • The Agony of the Welfare State, Finnish Style

    The title of this post – minus the reference to Finland – is shamelessly copped from a prescient essay that Ludwig von Mises wrote in 1953. In his article Mises pointed out that in Great Britain and Europe, the system of progressive taxation was already confiscating nearly the entire ‘surplus’ incomes of the successful capitalists and entrepreneurs, meaning that higher tax rates would no longer produce additional funds to finance these countries’ ever-expanding welfare states. ‘Henceforth,’ Mises foretold, ‘the funds of the beneficiaries themselves have to be tapped if more handouts are to be made to them.’
    Today things have gotten far worse than even Mises foresaw. For now it is becoming evident that the ‘beneficiaries’ of the most advanced welfare states are not reproducing rapidly enough to pay for the benefits that they are receiving and are therefore ‘endangering’ the ‘long-term survival’ of the ‘more generous’ welfare states. A notable example is Finland, which faces a ‘massive baby problem.’ Thus, in 2016, Finland recorded the lowest number of newborn babies in 148 years, or since the great famine of 1868. The Finnish fertility rate has fallen to 1.57 per woman and the number of people under 20 years of age as a percentage of the working age population is the lowest among Nordic countries at less than 40%, down from 60% in 1970.

    This post was published at Ludwig von Mises Institute on September 22, 2017.

  • Equifax Accidentally Directs 200,000 Customers To Fake Phishing Website

    And the hits just keep coming for Equifax, the once-trusted credit-monitoring firm that has been embroiled in one of the biggest corporate public-relations disasters in recent memory since disclosing that hackers had penetrated its cyber security defenses and absconded with sensitive personal and financial data belonging to 143 million Americans. Because of the types of data that were stolen, including drivers’ license, social security and credit-card numbers, experts have described the hack as possibly the most damaging corporate hack yet.
    As if this weren’t enough to permanently sully the firm’s reputation (amid cries of ‘you had one job!’) – the staggering irony of a credit monitoring firm inadvertently divulging the sensitive information that it was supposed to safeguard hasn’t been lost on consumers) a series of subsequent disclosures have portrayed the firm’s executives as bungling, at best, and nefarious, at worst.
    In the nearly two weeks since the story broke…

    This post was published at Zero Hedge on Sep 21, 2017.

  • Really Bad Ideas, Part 4: Federal Flood Insurance

    As Hurricanes Harvey and Irma wreaked their havoc over the past couple of weeks, several interconnected questions popped up, the answers to which make us look, to put it bluntly, like idiots.
    Why, for instance, are there suddenly so many Cat 4 and 5 hurricanes? Is this due to man-made climate change and is this summer therefore our new normal? The answer: Maybe, but that misses the point. There have always been huge storms (like the one that wiped Galveston, TX off the map in 1900, long before global warming was a thing), and barring another ice age there always will be. So the US east coast will remain one of Mother Nature’s favorite targets.
    A second (and vastly more pertinent) question is why we’ve been encouraging millions of people to move into this bulls-eye in recent decades. Since 2000, Houston and surrounding Harris County have added 1.2 million people. Since 1980 Florida has added 10 million people – most of them in the coastal corridor from Miami to Fort Lauderdale.
    Seems a little unwise, doesn’t it, to put tens of millions of people and millions of houses and cars where they’re guaranteed to be damaged or destroyed by inevitable future storms. But it’s not an accident. Government programs actively encourage this migration by picking up part or all of the tab for homes that are flooded by storms. The result: A massive and growing liability for future damage on top of all the other massive and growing liabilities for Medicare, Social Security, underfunded state and local pensions, etc. From last week’s Wall Street Journal:
    One House, 22 Floods: Repeated Claims Drain Federal Insurance Program
    Brian Harmon had just finished spending over $300,000 to fix his home in Kingwood, Texas, when Hurricane Harvey sent floodwaters ‘completely over the roof.’

    This post was published at DollarCollapse on SEPTEMBER 19, 2017.

  • Finnish Politician Tells Women ‘Be Patriotic, Have More Babies’ As Birth Rates Crashes To 150 Year Lows

    For years, the Japanese government has been desperately trying to encourage its citizenry to have more sex to combat the collapsing demographics the nation faces, trying guilt (blasting their “sexual apathy”) and punishment (imposing a “handsome tax” to make lief more even for ugly men), to no avail.
    Now it appears Finland is suffering a similar fate. As Bloomberg reports, Finland, a first-rate place in which to be a mother, has registered the lowest number of newborns in nearly 150 years.

    The birth rate has been falling steadily since the start of the decade, and there’s little to suggest a reversal in the trend.
    Demographics are a concern across the developed world, of course. But they are particularly problematic for countries with a generous welfare state, since they endanger its long-term survival.

    This post was published at Zero Hedge on Sep 20, 2017.

  • To Hell In A Bucket

    No-one Cares… ‘No one really cares about the U. S. federal debt,’ remarked a colleague and Economic Prism reader earlier in the week. ‘You keep writing about it as if anyone gives a lick.’
    We could tell he was just warming up. So, we settled back into our chair and made ourselves comfortable.
    ‘The voters certainly don’t care about the federal debt,’ he continued. ‘They keep electing the same spendthrifts to office. And the politicians know the voters don’t care. They also know that making more and more promises is the formula for getting reelected.
    ‘Deep down, the aging masses know they need massive amounts of government debt to pay their social security, medicare, and disability checks. On top of that, many of the so-called gainfully employed are really on corporate welfare; they hang their hats on government contracts to fund their paychecks.
    ‘You know as well I do how this crazy debt based fiat money system works. The debt must perpetually increase or the whole financial system breaks down. The best we can hope for is that the ongoing currency debasement merely leads to a subtle erosion of living standards. That’s the best-case scenario.
    ‘But, again, no one except maybe a handful of your readers’ gives a rip about the federal debt. Plus, if you’re gonna keep writing about it you need to use better terminology. The federal debt has grown at such a rapid rate that standard dollar units no longer capture what’s going on. The debt numbers are so large it is difficult to distinguish between hundreds of billions and tens of trillions of dollars.

    This post was published at Acting-Man on September 19, 2017.

  • How Welfare States Encourage Bad Economic Thinking

    The greatest intellectual accomplishment of the laissez-faire liberal theorists was the recognition of the ‘hard’ and ‘soft’ institutions that are crucial prerequisites of productive accomplishment and material prosperity. The hard institutions include private property rights, market prices, and sound money. The soft institutions include those that reinforce values such as prudence, thrift, resourcefulness, innovative courage, and respect for success.
    However, this accomplishment was accompanied by a proportionately great intellectual error – the belief that these institutions can be safeguarded exclusively by monopolistic apparatus of aggressive violence, commonly known as states. Since states necessarily parasitize on the productive output of market society, the belief that they are necessary for its emergence, let alone that they can remain ‘minimal’ after its emergence, is fatally misguided. On the contrary, it appears perfectly predictable that they will grow in step with the increase in market output.
    Unfortunately, this is not the end of the story. As powerful as states may be in terms of sheer physical force, their survival is ultimately rooted in favorable public opinion, and the best way to secure such opinion is to share their plunder as widely as possible. Thus, with sufficiently wealthy hosts at their disposal, states invariably turn into ‘welfare’ states. And it is at this point that they start sawing off the branch on which they are sitting.
    With productive achievement institutionally separated from consumption opportunities, the wealth-generating soft institutions start to erode particularly fast. When there is great abundance all around, but it seems that it can be enjoyed without putting in any productive effort, increasingly many of those who do not so enjoy it come to believe that abundance is a free good, and that the only reason why it is not free for them is because someone unfairly withholds it from them. In other words, the prevalence of welfare-statist ‘redistribution’ spells the death of economic thinking – that is, thinking in terms of resource scarcity, opportunity costs, and incentive structures. This temporarily strengthens the state even further – since at this point the state immediately steps in as an entity that is able and willing to punish the malevolent withholders – but it also further accelerates the death of the goose that lays its golden eggs.

    This post was published at Ludwig von Mises Institute on September 2, 2017.

  • Systemic Uncertainty, Meet Fragility

    That’s the problem with fragility: everything looks fine on the surface until a crisis applies pressure. Then the whole rickety contraption collapses in a heap..
    This doubt is fact-based; as the number of retirees swells, as Medicare costs soar ever higher and the number of full-time jobs paying into Social Security/ Medicare stagnates, these pay-as-you-go programs break down; Social Security is already paying out billions more than it collects from employers and employees. Life is inherently uncertain, but systems that were once considered certainties have increasingly become uncertain. Social Security is one example; recent polls reflect widespread doubts among Millennials and Gen-Xers that there will be any Social Security benefits left for them by the time they reach retirement age. Uncertainty is one thing, fragility is another. The socio-economic systems we rely on are also becoming increasingly fragile and prone to failure, for an entirely different set of reasons than those driving uncertainty. Changing fundamentals drive uncertainty. The nation’s demographics and stagnant wages for the bottom 95% are extremely unfavorable for pay-as-you-go programs like Social Security and Medicare; their future is uncertain because the inputs and outputs are changing.

    This post was published at Charles Hugh Smith on TUESDAY, AUGUST 29, 2017.

  • Fidelity Says Baby Boomers Haven’t Even Saved Enough To Cover Their Healthcare In Retirement

    While statistics are somewhat sketchy on the topic, most research suggests that the average retirement-age household has managed to set aside roughly $200,000-$250,000 for their golden years. Unfortunately, they’ll need more than that just to cover their healthcare costs. Per Bloomberg notes today, the average 65-year-old couple will need roughly $275,000 to cover their healthcare costs during retirement…and that’s with Medicare.
    A 65-year-old couple retiring this year will need $275,000 to cover health-care costs throughout retirement, Fidelity Investments said in its annual cost estimate, out this morning. That stunning number is about 6 percent higher than it was last year. Costs would be about half that amount for a single person, though women would pay a bit more than men since they live longer. You might think that number looks high. At 65, you’re eligible for Medicare, after all. But monthly Medicare premiums for Part B (which covers doctor’s visits, surgeries, and more) and Part D (drug coverage) make up 35 percent of Fidelity’s estimate. The other 65 percent is the cost-sharing, in and out of Medicare, in co-payments and deductibles, as well as out-of-pocket payments for prescription drugs.
    And that doesn’t include dental care – or nursing-home and long-term care costs.

    This post was published at Zero Hedge on Aug 25, 2017.

  • Social Security Will Be Paying Out More Than It Receives In Just Five Years

    When social security was first implemented in the 1930’s, America was a very different country. Especially in regards to demographics. The average life expectancy was roughly 18 years younger than it is now, and birth rates were a bit higher than they are now. By the 1950’s, the fertility rate was twice as high as it is in the 21st century.
    In other words, for the first few decades, social security seemed very sustainable. Most people would only live long enough to benefit from it for a few years, and there was an abundance of young workers who could pay into the system. Those days are long gone. As birth rates plummet and people live longer, (which otherwise should be considered a positive development) social security’s future is looking more and more bleak.
    No matter how you slice it, it doesn’t seem possible to keep social security funded. In fact, social security is going to start paying out more money than it receives in just a few short years. It may even be insolvent before the baby boomer generation dies off.
    According to the Social Security Board of Trustees, the Old-Age and Survivors Insurance, and Disability Insurance (OASDI) Trust Funds will be depleted in 2034.
    When this happens, only 77 percent of benefits will be payable. That estimate is no change from last year’s estimate.

    This post was published at shtfplan on July 18th, 2017.

  • Guess What Happens In States Where Food Stamp Recipients Have To Work

    Leftists are constantly reminding of us of the merits of welfare. They tell us that without the help of taxpayer funded handouts, millions of Americans will starve or be left homeless. There’s no doubt that some people really do need help, but this black and white view of welfare doesn’t paint the full picture. Conservatives and libertarians have suspected for decades that many of the people on welfare are actually mooching off of the system. So to reconcile the need to help people who are helpless with the very really problem of people abusing the system, they’ve come up with a great compromise.
    In regards to food stamps, they’ve suggested that we offer food assistance on the condition that the recipients are working. Or at the very least, that they volunteer or community service or are making an effort to train themselves for a new job. So what happens in states that have work requirements for food stamp recipients?

    This post was published at shtfplan on July 17th, 2017.

  • If You Can’t Answer These 5 Social Security Questions, You’re Not Ready to Retire

    For millions of Americans, Social Security is their livelihood.
    Over 66 million people receive Social Security – that’s 20% of the U. S. population. A whopping one-third of these beneficiaries rely on Social Security for at least 90% of their income. What’s more, for 61% of all beneficiaries, Social Security is at least half of their income.
    Odds are that, if it isn’t already, Social Security will be a major part of your income one day. That means it’s important to know where that money comes from, how it’s distributed, and how long you can expect to receive it.
    So give yourself a test and try to answer these five questions – and if you don’t know some of the answers, we’ve got you covered…

    This post was published at Wall Street Examiner by Cooper Creagan ‘ July 12, 2017.

  • It’s Official, Obamacare Collapse Is Trump’s Fault – Just Ask The WA Insurance Commissioner

    Last night, Washington’s Insurance Commissioner Mike Kreidler sent out a press release noting that two counties in his state, Klickitat and Grays Harbor, would be left with no health insurance options in 2018. Per the press release, the ~3,330 people in those counties currently signed up on the exchange would be able to buy insurance through the state’s high-risk pool but they would lose access to taxpayer-funded subsidies.

    This post was published at Zero Hedge on Jun 9, 2017.


    Florida Department of Agriculture Commissioner Adam Putnam announced on Monday that hackers may have obtained the names of concealed weapon licensees in a data breach that ‘appears to have originated from overseas’ (must be those Russians again!).
    The breach may have revealed the social security numbers of 469 customers, and another 16,190 may have had their names but ‘no other individually identifying information’ was compromised.

    This post was published at The Daily Sheeple on MAY 24, 2017.

  • Another Fraudulent Jobs Report

    ‘Willing suspension of disbelief’ is defined as a willingness to suspend one’s critical faculties and believe the unbelievable; sacrifice of realism and logic for the sake of enjoyment. First off, I want to state upfront that there’s nothing enjoyable about the monthly non-farm payroll report unless you enjoy being subjected to brain damage.
    Each month the Government asks us to suspend our critical faculties and accept the headline-reported number of new jobs created by the economy as well as the unemployment rate. Once again the Government did not disappoint, as it headline-flashed the alleged creation of 211,000 jobs and an unemployment rate of 4.4%.
    Unfortunately, for the mindless masses who consume fast-food style news from mainstream news sources, once the headline numbers are absorbed and the ‘experts’ reaffirm them with their idiotic psycho-babble, the numbers as reported miraculously become The Numbers.
    To say that the latest non-farm payroll report stretches the ability to suspend one’s disbelief is an understatement. The Government wants us to believe that 211,000 new jobs were created in April – ‘seasonally adjusted,’ of course. A cursory glance reveals that 162,000 working age civilians decided to just leave the labor force, which explains the alleged decline in the unemployment rate. Either those folks who walked away were bequeathed with Social Security disability, took out a big student loan and enrolled for an online degree program at one of the many online universities or, most likely, their jobless benefits expired and they simply gave up looking for a job that pays more than minimum wage (Note: the latter explanation is supported by the recent spike up in auto loan, credit card and mortgage delinquency rates).

    This post was published at Investment Research Dynamics on May 5, 2017.

  • Obamacare Finally Repealed

    The American Health Care Act (HR 1628) finally passed by the House yesterday reducing taxes on the American people by over $1 trillion. The bill abolishes the most abusive taxes taxes imposed by Obama and the Democrat party back in 2010 known as Obamacare. The Democrats helped the insurance companies and burdened the youth trying to force them to pay for insurance they did not need to get insurance companies to cover people they would not.
    Obama as a presidential candidate back in 2008, had promised repeatedly that he would NOT raise any tax on any American earning less than $250,000 per year. That was an outright lie. As always, they claim they will only tax the rich, but it never end up that way.

    This post was published at Armstrong Economics on May 5, 2017.

  • Dow Jones News: Dow Drops as House Republicans Pass Obamacare Replacement Bill

    This is a syndicated repost courtesy of Money Morning. To view original, click here. Reposted with permission.
    In Dow Jones news today, the Dow dropped six points as congressional Republicans voted in favor of repealing and replacing parts of the Affordable Care Act.
    Here are the numbers from Thursday for the Dow, S&P 500, and Nasdaq:
    Index Closing Point Change Percentage Change Dow Jones 20,951.47 -6.43 -0.03% S&P 500 2,389.52 1.39 0.06% Nasdaq 6,075.34 2.79 0.05% Now here’s a closer look at today’s most important market events and stocks, plus Friday’s economic calendar.

    This post was published at Wall Street Examiner by Garrett Baldwin ‘ May 4, 2017.

  • The Greatest Ponzi Scheme in History

    This is a syndicated repost courtesy of The Daily Reckoning. To view original, click here. Reposted with permission.
    The Chinese credit bubble is a ticking time bomb. That bubble is primed to explode with or without anything Trump does. When it happens and how it happens will have profound implications for your portfolio.
    Bernie Madoff may have set a record for the biggest Ponzi scheme in U. S. history (if you don’t count Social Security), but China has set the world record.
    Madoff’s scam was either a $65 billion Ponzi if you count fake profits, or a $20 billion Ponzi if you just count original investor money that he stole. Either way, it was a U. S. record.
    Now China is about to set the world record with a $9 trillion Ponzi. Here’s how it works…

    This post was published at Wall Street Examiner by James Rickards ‘ May 4, 2017.

  • The New GOP Healthcare Bill Still Contains a Costly Oversight – but It’ll Get Passed

    This is a syndicated repost courtesy of Money Morning – We Make Investing Profitable. To view original, click here. Reposted with permission.
    The highly anticipated new ‘RyanCare’ bill has been drafted; the House will vote on it today, with supporters hoping to repeal and replace Obamacare.
    But it’s got a major problem.
    In order to pass, this GOP healthcare bill needs to win over the moderate Republicans who were dissatisfied with the first version’s lack of coverage for Americans with pre-existing conditions.
    It does take steps to do that – but still falls massively short.

    This post was published at Wall Street Examiner by Money Morning Staff Reports ‘ May 4, 2017.