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Readers have reported that this story contains information that may not be accurate.US Economy: No Longer No. 1, and No Wonder
washingtonpost.com — On the surface, two studies out this week seem to raise warning flags about the competitiveness of the U.S. economy. These reports speak to the embarrassing failure of a decade of Republican rule in improving U.S. competitiveness. Business taxes, as a percentage of anything you want to measure, are at their lowest level in decades.
p9s50W5k4GUD2c6- 568 diggs
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- webXL, on 10/12/2007, -36/+40Good article, but this isn't news. We've never been even close to numero uno in the Economic Freedom index: http://www.heritage.org/research/features/index/country.cfm?id=Unitedstates
The economy isn't stupid. It (everyone in it) knows we'll end up paying sooner or later for the massive gap in what it's been taking in and dishing out (for votes). If you want fewer taxes AND and a better economy, vote Libertarian.- illynova, on 10/12/2007, -15/+40No empire last forever. The Egyptian empire, the Persian Empire, the Greek Empire, the English...
... in the end, the mighty fall and a new state will take its place in time. Its hard for the citizens to swallow, though. - Philodox, on 10/12/2007, -17/+39Because a political party with no governing experience will be guaranteed to magically turn everything around.
- Matadon, on 10/12/2007, -21/+62I won't vote Libertarian, because the Libertarians, while their hearts are in the right place, are blinded by their own ideology.
Most libertarians seem to forget that the purpose of government is to protect and promote the governed citizens -- all of them. A government is supposed to protect and promote *all* of society; a government which does not do this
violates the social contract, and deserves to be overthrown. In a free society, this means that government interference in the lives of ordinary citizens is generally a bad thing.
This does not always mean that all government influence is bad.
Public schools, for everyone, rich and poor, serve the greater good of a society, by allowing anyone to get an education, regardless of how competent (or not) their parents were at gathering green pieces of paper. More importantly, without an educated society, liberty dies at the hands of propaganda, because the minds of the individuals have not been inoculated with the reasoning skills required to see past the lies.
Yet most Libertarians that I know what schools more-or-less privatized.
Public healthcare, for everyone, rich and poor, is more cost-effecitve than the current hodgepodge of HMOs, and provides for the greater benefit of society in a multitude of ways. People are more likely to go to a doctor if they can afford it, which helps greatly in the containment of disease. Supporting universal healthcare provides each individual with greater health, yet most Libertarians are opposed to this because it's 'socialist'.
Nevermind that we had public, universal healthcare for many years in the United States.
Economic regulation, vis-a-vis the SEC, is essential. They may not do the best job, but there's a reason that Enron and Worldcom just dented the market, rather than destroying it outright. The SEC may not be perfect, but it does the job.
Some sort of welfare system is also essential. Sure, giving money to people who have demonstrated a lack of ability to manage it is utterly stupid, but that's no reason not to have state-run homeless shelters and soup kitchens, providing food, shelter, and clothing. It doesn't cost much in the way of taxes, and it keeps the homeless off the streets.
We need police and fire services. Oversight over civil engineering projects. There are so many aspects of government which simply cannot be handled by lassez-faire, because it is flat out illogical to do so.
Libertarians do have it spot-on with the War on Drugs (we need to stop this farce), and with gun control (the 2nd Amendment guarantees all the others).
Our tax system does need to be reduced to something the average college grad can understand.
The military-industrial complex does need to be curtailed, and pork-barrel highway projects need to go away.
But this doesn't mean that nearly all government services need to be eliminated.
Until the Libertarians get off the high horse of 'less government is ALWAYS better', I will not vote Libertarian. - Popcan, on 10/12/2007, -38/+21@matadon
The United States of America has the best health care in the world. If you are sick, go to a hospital and i guarantee you will be treated. If you are in Canada, you will be put on a waiting list for chemotherapy. ( http://www.wcwl.org/ ) - 23r17i05o42n, on 10/12/2007, -29/+14Nice partisan study there. Nice partisan article from Washington Post. The liberals sure are "fair and balanced". The study is a load of crap, filled with soft pseudo-science.
Vote Libertatian! - supergnome, on 10/12/2007, -13/+16@Popcan
What's the point if you and your family will be in crippling debt for the rest of eternity? - Prelude76, on 10/12/2007, -5/+27@popcan
My wife delivered two daughters in past 2.5 years. cost to me, zero dollars.
Her friend in the states had 'complications' with delivery, needed c-section and extra tests and hospital stay. they now have a healthy baby boy, and a $15,000 loan for the health care. just what you need when you're starting a new family, a huge loan.
sure, you may have a waiting period to get into chemo, or to see a specialist, but it's free*.
* = heavily subsidized by our huge taxes. ;) - cliffzdude, on 10/12/2007, -10/+9The person posting this article said:
"These reports speak to the embarrassing failure of a decade of Republican rule in improving U.S. competitiveness. Business taxes, as a percentage of anything you want to measure, are at their lowest level in decades."
Attempted Anti Republican rant? Yes. Failed Anti Republican rant? Yes.
It isn't often somebody's agenda, and ignorance can show up in on sentence.
According to the reports you reference, the LOWER the business taxation in a country, the more points FOR that Country.
One could read the poster's intro and say he's pointing to how much lowering taxes hasn't "helped", however I think that is/will be hindsight on his part. - poxonyou, on 10/12/2007, -5/+22Maybe it's just me, but if I was trying to make a judgement about what socioeconomic model is the best from these studies, I'm inclined to think it's the scandinavian (or nordic) economic model, not the Libertarian Party of the U.S.'s. The scandinavian model is a free-market with heavy taxes, but the taxes are used primarily for the good of the people of the country as opposed to the military or external projects. Somehow it works, and it has a proven history of working, despite what critics say. Again, maybe it's just me, but given the choice of following the Libertarian Party model or the scandinavian economic model if we were to radically restructuring the U.S. socioeconomic system, I would definitely choose the latter. Call me crazy.
Anyway, I know WIkipedia is not the most reliable and scholarly source for information, but it's a good starting point for most people, so:
http://en.wikipedia.org/wiki/Nordic_countries
http://en.wikipedia.org/wiki/Scandinavian_welfare_model
http://en.wikipedia.org/wiki/Economy_of_Switzerland
http://en.wikipedia.org/wiki/Economy_of_Sweden - raptordrew, on 10/12/2007, -2/+5How many Libertarian presidents has the U.S. had? None that I can recall. The people of the U.S. realize that electing one might help the economy, but would be detrimental to the country's military and security. While there are a lot of Libertarian views I agree with, there are key ones the party holds that I disagree with - ones that would put the country in a precarious place. I'm registered Republican, but that's just a label - at heart I'm just an American who wants to protect my country and make sure the people's best interests are held, but above all, that these people are protected and given freedom in the first place.
- jpreynolds, on 10/12/2007, -10/+1What Ever. Moron
- argoff, on 10/12/2007, -6/+8@Matadon, I don't think you understand. The Libertarian philosophy IS the one that is in touch with the "real" world, not an idealistic fantasy one. It can deal with school prayer, homosexuality in schools, gay teachers, the pledge of allegiance issue, education quality, cost per student, and student privacy with ease - while the public school philosophy falls on it's face over these every time. That's because it is in touch with the "real" world, and can deal with "real" issues. The same with the war on drugs ... all these extra people in prison, all these drug enforcement costs, all the loss of privacy rights relating to it, the police state mentality, all the privacy invasions of peoples financial transactions ... once again, the libertarian philosophy deals with these real world issues head on while the others fall on their face. Same with health, the skyrocketing costs, the massive liabilities, the skyrocketing insurance, the complicated employer plans ... the libertarian philosophy deals with these, while the "lets provide guaranteed care for everyone philosophy" does nothing but drive up costs, or create health care shortages. Same with stocks, when the Fed bailed out LTCM to prevent a financial disaster, it sent the stock market a message that if they take reckless systemic risks ... the system will bail them out. Now the risk in the system is worse, but the Libertarian philosophy faces these kind of consequences head on, while the "fed" philosophy copes with them and hides from them. But the most important real world point that libertarians nail spot on is money. A gold based money system tends to limit the amount of debt in society and keep prices constant over time. But have you noticed that prices and debt are always going up, and almost never down in the US economy. Once again, the libertarian philosophy deals with this, while other ones cover it up and pawn it off till it's too late.
The problem isn't that the libertarian philosophy can't deal with real world problems, the problem is that people want a guarantee when life gives none, that people want utopia to be handed to them by the government on a platter instead of rolling up their sleeves and making one. That people want the right circumstances, but not the hard choices that it takes to make them. - RickySan65, on 10/12/2007, -3/+11"If you are sick, go to a hospital and i guarantee you will be treated."
Unless you are not insured.. wouldn't call that best healthcare in the world. but hey, if you think it's great, then all the power to you.. - there, on 10/12/2007, -4/+12 "The United States of America has the best health care in the world. If you are sick, go to a hospital and i guarantee you will be treated. If you are in Canada, you will be put on a waiting list for chemotherapy. ( http://www.wcwl.org/ )"
Sorry to burst your propaganda bubble but this is not true in most cases (i.e. if you're not rich).
Putting aside some people in the US don't have any healthcare or go into debt when they are sick....in Canada since you have universal healthcare... people visit the doctor more often for checkups and minor health annoyances (since they are free). My guess is that this preventative measure alone is what explains why for DECADES they have statistically lived LONGER lives than Americans (the ultimate measure of a good healthcare system).... even though their demographics are quite similar to the US.
The truth is the US falls behind MANY MANY nations in actually life expectancy. Most of the developed world has universal healthcare.... and guess what... the US ranks 47th in the world. The number speaks for itself.
FORTY SEVENENTH!!!!
So much for extremist rightwing philosophy that less government is always better.
http://www.nationmaster.com/graph/hea_lif_exp_at_bir_tot_pop-life-expectancy-birth-total-population - bobbknight, on 10/12/2007, -10/+10This one just made me laugh out loud.
From the 1930's through to today we have had a socially planed economy.
From taxes to health care, most of which was put in place by the Democrats.
Now the democrats are bitching about our lack of competitiveness in the word stage.
LOL - there, on 10/12/2007, -2/+6........
"lets provide guaranteed care for everyone philosophy" does nothing but drive up costs, or create health care shortages."
........
This is the problem with people that are ideologically driven rather than emperically driven. They ignore facts that don't suit them. Again in virually every developed nation on the planet that has universal healthcare.... they tend live longer AND spend less for healthcare. (don't let the facts interfere with your theories though :) For example In the UK they spend less than HALF as much as Americans do for healthcare and yet live longer.
http://gladwell.typepad.com/gladwellcom/2006/05/us_versus_uk.html
My ideal system would be something like open source.
Everyone gets the basic product for free... if you want exceptional service (e.g. no waiting times that are typical of universal healthcare or say a private room) then you pay through the nose for the extra service (whose money gets pumped back into the system)
Universal healthcare works. America's system is what is busted. - unibomber999, on 10/12/2007, -1/+5If you're worried about a Libertarian president killing off public schools and the like, don't bother. There is no way that any President is going to get that through congress. In spite of what this administration would have you believe, the President's power is largely one of influence.
The libertarian party seems more aligned with the views of the general populace these days, which is economically conservatice and socially liberal. As time goes on I see the corruption of the current 2 party system become more evident as they converge and their views become almost indistinguishable from one another.
I'm going to vote libertarian because I want the existing parties to recognize the support for the party and adopt their views, even if the Libertarian candidate doesn't win. - iceperson, on 10/12/2007, -4/+2"Her friend in the states had 'complications' with delivery, needed c-section and extra tests and hospital stay. they now have a healthy baby boy, and a $15,000 loan for the health care. just what you need when you're starting a new family, a huge loan."
yeah. if you're going to have complications it would be better to do it in a country with free substandard health care... - iceperson, on 10/12/2007, -3/+2""If you are sick, go to a hospital and i guarantee you will be treated."
Unless you are not insured.. wouldn't call that best healthcare in the world. but hey, if you think it's great, then all the power to you.."
talk out of your ass much? it's against the law for hospitals to refuse to provide treatment to people who need it. - NoNom, on 10/12/2007, -0/+2Just because it maybe against the law does not stop it from happening.
- aviazn, on 10/12/2007, -1/+3@Poxonyou
The major reason Scandinavian countries can afford to have socialist economies is because they have huge state-owned oil reserves. We don't have that; most of the health-care reforms people are proposing in America today (like Romney's in Mass.) rely on the competitiveness of our economy. If the economy goes into recession, then costs spiral out of control and God knows budget deficits aren't what we need right now. - aviazn, on 10/12/2007, -0/+2I agree with the comments about the Libertarian Party--capital L Libertarians tend to be a bit extremist. But I agree with libertariansim as a philosophy. Here in Minnesota, the Independence Party (Jesse Ventura's old party) is big enough that it's considered the third major party; the IP candidate is always included in debates and leans libertarian, but not as far as the Libertarian Party typically does.
- geekee, on 10/12/2007, -1/+2"The major reason Scandinavian countries can afford to have socialist economies is because they have huge state-owned oil reserves."
Yes, that's also the only reason Hugo Chavez gets elected in Venezuela - jeffiek, on 10/12/2007, -0/+2Wow. The anti-libertarian crowd is out in force tonight. Complete with all their misunderstandings of them, the Republicans, and the Democrats
Philodex:
"Because a political party with no governing experience will be guaranteed to magically turn everything around."
Well, the other two aren't doing such a great job. Try looking at it this way. When you're in a rut the best thing to do is STOP DIGGING. The R's and D's are digging. It doesn't take any experience to NOT do something. What the R's and D's are doing is damaging. It needs to stop.
Matadon:
"Public schools, for everyone, rich and poor, serve the greater good of a society, by allowing anyone to get an education, regardless of how competent (or not) their parents were at gathering green pieces of paper."
I'll skip over all the harm even the best public schools do and head straight for the money part. Where do you think the best schools are? (hint: try well to do neighbor hoods) Where do you think the worst schools are? ( do you really need another hint?)
The really rich go to private schools anyway. Middle class parents bend over backwards spending money on higher cost of living to get into better schools. Those "not competent at green pieces of paper" wind up with whatever they get, and that can be pretty bad. So you see, the reality is that the public school system suffers from the VERY SAME problem you claim that private schools have. It doesn't solve anything. It just makes the disparity a little less obvious.
Take off the rose colored glasses, look at the world for what it really is. Then we can get into the simple fact that the public education system isn't teaching what's good for society. Your solution is worse than your so-called disease. Does that make any sense?
I haven't the time to go through the entire list. All can be just as easily understood when you stop listening to political rhetoric and learn what the systems do in practice, not theory.
- dagonweb, on 10/12/2007, -3/+1Good riddance. The US, even though its people are nice generally, has been a plutocratic tumor on the world stage for half a century. Its needs to go now, become just another country. And better still, by NOT being a hyperpower the citizens will get a better deal.
http://www.globalfirepower.com/list_mil_exp.asp - eddigg, on 10/12/2007, -1/+1Right. And we have an "immigration problem" because nobody wants to come to the US.
- illynova, on 10/12/2007, -15/+40No empire last forever. The Egyptian empire, the Persian Empire, the Greek Empire, the English...
- MaddDog, on 10/12/2007, -10/+63The United States's economy accounts for 27% of the world's economy.. and is almost 3 times that of Japan, in 2nd place. If its going to fall, its going to be a long, slow death spiral. And judging from the consistent 3-5% growth the United States economy has had over the last 6-8 years, I wouldn't jump from the rooftop just yet.
- nullvector, on 10/12/2007, -6/+23And the stock market is due to hit record highs today? I wouldnt exactly say that our economy is in trouble.
- jgo6d, on 10/12/2007, -28/+3Haha, man, when did the right take over Digg? Digg used to be exclusively for liberals talking out of their asses. It's good to see that conservatives are here talking out of their asses too now.
"The United States's economy accounts for 27% of the world's economy.. and is almost 3 times that of Japan, in 2nd place."
If that is your benchmark for US success, you set your standards pretty low. Think about what you are saying.
"If its going to fall, its going to be a long, slow death spiral."
Oh, yippie! Long, slow spiral deaths are my favorite. Especially since they denote a flawed system rather than an extraordinary event. Imagine how much harder it will be to come back from years of misappropriation once the median economy is crippled by business and special interests. I can't wait!
"And judging from the consistent 3-5% growth the United States economy has had over the last 6-8 years, I wouldn't jump from the rooftop just yet."
Wow, could you make your numbers any more general? Suffices to say that the real growth numbers are more troubling than you faux emperical data. I'm not disputing growth, but look at who is reaping the benefits. Also, while the overall numbers are going up, most of the numbers used by economists to judge recovery from a recession are lower than they have been during any period of recovery for the past 60 years. - theodicey, on 10/12/2007, -4/+6If you're involved in any way with the auto industry, or live in MI or OH -- better to jump sooner than later.
GM is about to get bought by Renault, a French company that hasn't sold cars in the US for years.
Ford is about to go bankrupt too.
DaimlerChrysler, which is mostly a German company now, is losing its shirt on its American operations because they can't sell SUVs.
The auto industry was amazingly stupid to not demand universal health care back when they had the chance. Now, their health costs add $2000/car, and there's no way they can compete with Europeans, much less Asian manufacturers. They screwed up, because they believed the low-corporate-taxes dogma that this article is criticizing. - reeezo, on 10/12/2007, -4/+4Sorry buddy, the U.S. auto industry has a lot more problems that are causing their troubles than healthcare adding $2k to the cost of a car. Stepping aside from the leaner production models used by the Japanese and numerous business management reasons, would you buy a POS car that's going to break down on you all the time if you will save $2k buying it? Er, no.
- TubaTechno, on 10/12/2007, -3/+4Asking the government to pay for rising health care costs will not fix the problem: rising health care costs.
America's auto industry just isn't competitive. They need to make somethign "relevant" to today's society. - argoff, on 10/12/2007, -6/+2MaddDog, I think you're partially wrong. Given US culture, politics, technology, and history. I think the US is going to fall on it's face in a spectacular crash, and then once the reset button gets pushed it will do very nicely. But you are right about the US financial problems. On no uncertain terms, we are in deep deep trouble. We have more financial obligations than is possible to pay off. If they allow default, then the US will have the worst great depression in history, but unfortunately they are more likely to print up money to pay it off causing the worst hyperinflation in history. IMHO, people would be very wise to buy guns, food storage, and gold. .... Yes, you herd me, it's that bad.
- nightsweat, on 10/12/2007, -0/+4I'd be a bit worried about our transition to an economy that doesn't make anything. If you take out health care jobs, there's been almost no job growth at all for the last 5 years, and 155,000 more workers getting added to the economy every month.
You don't get or stay rich as a nation giving each other appendectomies. - zacmccormick, on 10/12/2007, -4/+5Did that article really try to convince me that scandanavian economies are better than the USA economy? hahaha. Is that the same economy where you give 60% of your money to the government just for living there? Yeah that's an excellent economy. And in return for your 60% taxes, you end up with almost the same life style that can be achieved in the USA without the government taking it all?
"Indeed, a reasonable inference from the World Economic Forum rankings is that the best way to compete is to adopt the Nordic model of high taxes, a generous social safety net and lightly regulated labor markets"
The best way to increase competition is to blow billions of dollars a year on inefficient government programs?
Norway's economy is 1.5% the size of the USA's, and we can have nearly identical per capita numbers without all of the lame social programs and big government. So, I would say, if anyone is in need of reform it's scandanavia who needs to catch up to the USA!
The article talks about the "decades of failure of Republicans"... Ok let's move out of the way for the democrats to come in and fix all the problems by making more government programs and generally taking money from people who know to manage it, and giving it to people who don't know how to manage it. How is that a solution again? Other than a quick fix for their bleeding hearts. Of course there is no factual information in the article about what Republicans actually did to create all of this havoc that he seems to believe is ruining our economy, he just makes the comment and then keeps ranting.
The next article is going to try and convince me that Norway and Sweden's military is gaining strength and could be more powerful than the USA at any minute! Which brings up another point, Norway can afford to spend millions on government programs because they don't have to maintain the most powerful military force on earth, they can just use the USA for protection, and let us conveniently fit the billion dollar bill into our budget. - gb506, on 10/12/2007, -1/+2@argoff:
US govt debt is at roughly 8.5 trillion dollars. The US govt gross receipts for 05 were roughly 2.1 trillion. That ratio is roughly the same as a person making $100,000 per year puchasing a $400,000 home. On a 30 year mortgage, the $100k guy would have a payment of less than $600 per month - well within his ability to pay. The situation isn't so dire as you make it appear.
If - yes, a big IF - were were able to pass a ballanced budget amendment we could have the national debt wiped out in realtive no time w/o any changes to tax code.
On the other hand, it can be said that having a sizable amount of foreign debt promotes geopolitical stability. For example, do you think it wise for China to invade Taiwan or Japan when they'd surely see all of the US paper they hold evaporate in thin air? Hardly.
Do you think China has a stake in a healthy US economy? Absolutely, without it they're screwed.
- chrisinsocalif, on 10/12/2007, -21/+3I agree with you maddDog, good post.
- repins, on 10/12/2007, -26/+38This is just more politically motivated FUD from the the "I hate Bush" crowd. The stock market is close to its highest level ever, the unemployment rate is near an all time low, gas prices are declining....but the Economy is in the toilet? please.....
- jgo6d, on 10/12/2007, -14/+35Yeah but...
"The stock market is close to its highest level ever, "
Yeah, but that has pretty much been the case since the Great Depression.
"the unemployment rate is near an all time low, "
Yeah, but median household income is going down relative to inflation.
"gas prices are declining"
Yeah, but two years ago, gas was around $1.50 a gallon. - kakapu4u, on 10/12/2007, -18/+14I hate our idiot president, but I think our economy is okay. I have a job, and my taxes are not so bad... basically I can't complain. But you can't watch our debt grow and our dollar weaken and say everything is looking great. So while we aren't complaining that things are ***** right now, we can definitely and accurately blame Bush for his part in heavily increasing our national debt, which leads to a weaker dollar.
No, the sky isn't falling yet, but it will if this behavior continues. - neoform, on 10/12/2007, -12/+11Maybe, but Bush is digging the US into a foreign debt that the next president is going to have one hell of a time getting us out of..
- Jawood, on 10/12/2007, -2/+10The only thing I would disagree with you on is that gas prices falling as being a symptom of a good economy. (Sorry if I misunderstood you) Petrol prices are based strictly on supply and demand - OPEC controlling supply of their crude to control prices, wars that stop shipment of oil from an oil producing country reduces supply will boost prices, etc...
Decreasing gas prices may help boost the economy because it reduces the cost of doing business and viceversa for increasing gas prices. In other words, gas prices are one of the many factors that contribute to the health of the economy.
Other than that, I agree with most of what you said.
I am not a Bush fan, but, if folks are going to criticize him, I'd wish they'd stick to what he's doing and what he has control over. Blaming him for things that he's not responsible for just gives his fan boys more reasons to discount the critics. - canti32, on 10/12/2007, -1/+6Yes, the stock market is doing fine, gas is coming down, and for the most part unemployment rates are dropping, but how long did it take for all of that to start happening?
Undoubtably, Bush probably could have been a better president if we didn't have to essentially re-think the way we make a living. With most other countries competing for jobs that were all but guaranteed to americans for many years, we need to step up our business practices and make it clear to both our citizens and the rest of the world that we are still the country to come to for production and service needs. However, the problem is twofold; other countries hire workers for inhumane wages, and most other countries despise us becaause of our crusade on the middle east. Therefore we need to pull out of the middle east, but slowly, so as not to completely collapse Iraq and Afghanistan, and focus on domestic affairs, such as tax reform, the social security issue, welfare and other government services. Once we have overhauled our government we should then make a return to the world stage and work with other countries to make the world a better place for all humans. I know that this is completely idealistic, but it's my opinion on what we should do to get the USA back on track. - repins, on 10/12/2007, -0/+5@Jawood
Actually, gas prices falling are not a symptom of a good economy, but rather will aid the economy. Higher gas prices are a drag on the economy because it costs more to make and deliver goods as well as giving people less money to actually spend on other things. - nickerbocker, on 10/12/2007, -1/+5Gas prices always go down in the fall and winter. Then rise back up in the summer.
- jfreeman, on 10/12/2007, -1/+3It's because the link goes to an opinion article, not news.
- jgo6d, on 10/12/2007, -14/+35Yeah but...
- jbenson2, on 10/12/2007, -14/+32What a crock!
Business taxes in the USA are lower than Finland - therefore the US economy is going downhill. What an idiotic article!- dahat, on 10/12/2007, -6/+17Agreed. I’d love to hear a simple explanation of how low corporate taxes harm our economy.
Heaven forbid companies (and people) get to keep more of the money they earn so as to be able to put it back into the system through further hiring, expansion and general spending. - supergnome, on 10/12/2007, -4/+10It's slow economic growth *in spite of* lowest corporate tax that makes it an embarassment to the Republicans. They've always maintained that corporate tax slows down the economy, but they can't produce real growth even when that supposed burden isn't there.
- jgo6d, on 10/12/2007, -7/+5"Heaven forbid companies (and people) get to keep more of the money they earn so as to be able to put it back into the system through further hiring, expansion and general spending."
Haha, man you're naive. Do you actually think that is what happens? That's a pretty simplisitic view. - mpeg2tom, on 10/12/2007, -4/+7All taxes create deadweight losses, this is basic economics. There probably are capital investments that only governments can do well (such as roads and military), but I suspect the majority of taxes end up providing less return to the economy than the same money would had it not been taxed.
US GDP growth is ahead of all of its competitors. 2005 US GDP growth was 3.2%, Germany had 0.9%, UK had 2.1%, France 1.4%.
"Competitiveness" has no definition. GDP, GDP per capita, GDP growth, and unemployment rates have definitions. Look at those.
BTW, I hate Bush as well, his banter drives me nuts, but he's better than someone more socialist than himself... - dahat, on 10/12/2007, -1/+3@jgo6d
Sure, not all companies behave in this way... but should we punish all of them because some do not act as responsibly as you’d like?
Why just have a progressive tax on them... why not take every penny that a government auditor says that they do not need to run their business... that will show them! - TubaTechno, on 10/12/2007, -4/+2"It's slow economic growth *in spite of* lowest corporate tax that makes it an embarassment to the Republicans."
Wow....its not because we're just coming out of a recession, is it? Think about it. Do some research, and THEN make an intelligent remark. - jgo6d, on 10/12/2007, -2/+3@dahat
"Why just have a progressive tax on them... why not take every penny that a government auditor says that they do not need to run their business... that will show them!"
I'm pretty sure that's not what I said at all. Your straw man attack tactics are less than constructive. While I don't believe we should "take every penny that a government auditor says that they do not need to run their business," I also don't think we should let business run roughshod over consumer rights and their corporate responsibilty in the name of fatter bottom-lines. There is a reason they do business here, so let them give something back.
I'm not sure if you can grasp this kind of pragmatic notion, but the answer lies somewhere in the middle. Not communism, not unchecked laissez faire economics. Not black, not white, but gray. Although, if all you want to do is get people in a frenzy, then being an idealogue is the way to go. - jgo6d, on 10/12/2007, -0/+3@TubaTechno
"Wow....its not because we're just coming out of a recession, is it? Think about it. Do some research, and THEN make an intelligent remark."
I'm wondering what kind of research you had to do to make that "intelligent remark." Here's some research about your "recession":
In terms of economic growth, this recovery ranks eighth for the four-year period after the official end of a recession, as measured by the National Bureau of Economic Research. This is out of the ten periods of economic recovery since 1950.
When measuring job growth from the end of the recession, this recovery is the slowest ever, up 2.6 percent in four years. The previous four year low was a 4 percent gain in the early 50s. - deMan, on 10/12/2007, -0/+0@jgo6d said:
"Heaven forbid companies (and people) get to keep more of the money they earn so as to be able to put it back into the system through further hiring, expansion and general spending."
Haha, man you're naive. Do you actually think that is what happens? That's a pretty simplisitic view.
Americans are known to have some of the worst savings rates in the world. If we're not saving it, we're spending it. So yes, lower taxes equals more money for people to spend, which goes back into the economy. That's not naive, and it is simple.
- dahat, on 10/12/2007, -6/+17Agreed. I’d love to hear a simple explanation of how low corporate taxes harm our economy.
- MrOss, on 10/12/2007, -16/+4http://www.thomaslfriedman.com/worldisflat.htm
- mandrsn1, on 10/12/2007, -2/+0This book was ok. Too much of it was common knowledge for anybody working in the tech industry.
- binaryspiral, on 10/12/2007, -13/+15China may take us over, but I still rather live here than there.
- cuwickliffe, on 10/12/2007, -25/+10C'mon guys ... Bush says the economy's doing great and we have to believe that because he's "The Decider." I mean, don't pay attention to those numbers behind the curtain nor those damn liberals (i.e., me, the other 95 percent of the planet and a large portion of the cosmos).
- broken1812, on 10/12/2007, -3/+3Are there really that many stupid people in this World/Universe?
- Aelbric, on 10/12/2007, -3/+3Unfortunately, yes, there are.
- unibomber999, on 10/12/2007, -0/+2For instance, the 1.5 billion "liberals" in China who pollute the environment, trample over human rights and speak regularly about expanding their borders through war and conquest?
I think I'll pass on that group membership.
- atstriker2000, on 10/12/2007, -7/+24I totally agree with MadDog, the sky isn't falling, and probably won't for a very long time.
This is just another example of sensationalism in the media, how much more can we hype a non-story? And then there's the spin in the description... "a decade of Republican rule" can you tell it's an election year?
/rant- TubaTechno, on 10/12/2007, -2/+2Hmm....this article neglects the fact that the economy was doing awesome the first 5 years, and then we had a recession. I love ignorant political rants, better than Dilbert comics.
- warmonger48, on 10/12/2007, -6/+23China and India are where we were at the end of World War 2. They have resources, they're ambitions, they have a population base willing to work for anything, and they are ingenious and resourceful. We have to learn to compete or be left in the dust like England, France, etc.....
- galore, on 10/12/2007, -9/+25"We have to learn to compete or be left in the dust like England, France, etc....."
Have you ever been to England or France?
For an interesting exercise:
Please drive through the US, e.g. Dallas to Chicago, and look at all the poverty, the run down small towns, the trailer shacks, the abandoned, deteriorating buildings.
And then drive from Nice, France to London, England. Then tell me who is left in the dust. - ElFredo, on 10/12/2007, -2/+11I live in France and I don't feel dusty, thank you.
- warmonger48, on 10/12/2007, -1/+5I didn't mean offense to England or France (two of the few places in the world were I would live) but they don't hold the ecomonic sway they used to in the world. And yes, there is a lot of poverty and destitution here, we need to change that before we try to change everyone else...
- there, on 10/12/2007, -0/+4 Rightwingers seem to have a very destorted view of the world.
England(60M) and France(60M) have a fraction of the population of the US (pop. 300M) this is why their economies aren't as big.... not because they are destitute. In fact.... if you compare all of Europe's GDP you'd actually discover they have greater output than the US.
Listen less to political propaganda and spend more time learning things for yourself. The US is generally a great place to live (other than that militaristic thing) but Europe is just as good. The US exceeds their output slighly per capita but better social services there lead them to live longer, healthier and happier lives then Americans (in fact some of the most socialist states in Europe actually have higher overall standards of living than the US)
http://en.wikipedia.org/wiki/UN_Human_Development_Index - there, on 10/12/2007, -1/+3
London... Berlin.... Geneva...Milan... Copenhagen...Vienna.... Dublin.... Stockholm...etc... are more expensive and have higher standards of living than virtually any place in the US.
I've actually been to a fair chunk of Europe AND traveled across 1-95 and I-10. You have been very misinformed by the rightwing. I would recommend you actually travel to those places before making such assertions. The French Riviera in particular is the most expensive spot on the planet. From Marseilles to Monaco the place is filled with mansions and the affluent.
Europe is very similar to the US overall. Each have their strengths. For the US.. it's a single large economy with one language (this helps with trade). With Europe...they are more of a mixed economy so IMHO this allows them to live happier and longer overall. (the two ultimate measures of life)
In the end the differences are marginal though. - plm0000, on 10/12/2007, -1/+0India is a very poor country..(I do not know about china so much because I did not visit it) I guess where only you visit is clean... but what you do not see??? By the way I do not think that India NOW is at the same level we were (USA) at the end of World War 2nd.... Go visit India and you will see... No rules what's so ever... The dirtiest... Somebody can sh** on the street... I guess it is OK for them.... and the need to control the population... THEY NEED CONDOMS....
- galore, on 10/12/2007, -1/+1@Sally:
"Yeah but from Chicago to Dallas is 5 X's as far (how can u compare that?) and you'll see a helluva lot more mansions."
?? What are you talking about ?? I specifically chose those routes because they are comparable !
Dallas - Chicago is 944 miles and Nice - London is 863 miles.
More mansions? Where? When I drive from Nice to London, I can stop in Versailles. Is there a comparable mansion between Dallas and Chicago?
And in the vicinity of Nice are those places like Monaco/Monte Carlo, St. Tropez, Cannes. Hardly void of mansions.
On the way from Nice to London, you go through cities like Marseilles, Cannes, Lyon, Paris and won't see a single trailer park. On the contrary - you will mostly see well maintained and expensive villas outside the metro areas.
On the way from Dallas to Chicago, you go through cities like Tulsa, St. Louis and Springfield (twice) and will see mostly trailer parks outside the metro areas.
I honestly don't understand where all the supposed riches of the USA are? I was totally shocked to see how substandard the living conditions of people outside of suburbia are. And that is not just from driving from Dallas to Chicago. I have driven all over the place in the US (California, Nevada, Utah, Colorado, New Mexico, Arizona, almost all of the mid-west, Vermont, New York, Florida, Indiana, Ohio, Michigan...)
I also have driven through much of Europe (Spain, France, Italy, England, Germany, Austria, Cech Republic, Estonia, Finland, Netherlands) and have never seen remotely as much poverty as in the USA. Not even in the former east block countries.
I am afraid to tell you your superiority attitude is unfounded. If some economic indicator suggests otherwise then we in the US are getting a raw deal given how poor so many of us are. At least as long as you are not in the upper echelon like Bill Gates.
- galore, on 10/12/2007, -9/+25"We have to learn to compete or be left in the dust like England, France, etc....."
- redhawkragnar, on 10/12/2007, -3/+10The description paragraph seems to imply that business taxes being low are the cause of the lack of competitiveness-- I'd say the opposite. The article urges business to compromise and make deals that aren't in the interest of business-- how would this make the economy more competitive exactly?
- dahat, on 10/12/2007, -2/+2I wouldn’t say that too loudly otherwise you’ll have people try to point out that the recession occurred during the Bush-43 Presidency... which of course assumes that the day he took office he implemented a whole slew of economic policies that fubared the economy so quickly.
- TubaTechno, on 10/12/2007, -4/+3People also tend to forget that the first 5 years of the "Republican rule" was very prosperous, then we hit a natural recession.
Seriously, for someone to say that giving tax cuts to small businesses hurt our economy...you know for a fact that haven't taken an economics or finance class....
- tom1018, on 10/12/2007, -7/+18So your point is, if taxes were increased, our economy would be more competitive? Hey, go pick up an Economics 101 textbook. Read it. Get a clue.
- useful, on 10/12/2007, -5/+7the "bush hater" crowd dropped out of college to protest the war, natural selection at its finest
- theodicey, on 10/12/2007, -4/+7Exactly. The taxes that built the interstate highway system never helped our competitiveness any. Our economy would be so much better if everyone had to drive on dirt roads.
Try picking up an Economics 201 textbook sometime, it's mindblowing. - TubaTechno, on 10/12/2007, -5/+3Ahh.. the good old "what about the roads?" argument. Since we all know that businesses aren't socially responsible and aren't involved in donating to projects that help the community.....
What if we privitized the postal service? FexEx is still as cheap as the USPS and it also is very socially responsible.
- atarlecky, on 10/12/2007, -5/+17It's absolutely ridiculous to think that raising business taxes would improve the economy. Time and again, taxes are eventually filtered down to the person buying the product and the business never really pays any tax at all.
- grizwald, on 10/12/2007, -7/+12BWAHAHA .. this is literally insane. I am convinced you have all lost your minds.
you guys are drunk on Bush hating .. - mandrsn1, on 10/12/2007, -5/+6If the economy is so bad, why is the Dow Jones at the second highest value of all time. I know that is not a 100% accurate representation. But if the economy was doing so poorly it certainly would not be at a near-recored pre-911 level.
- rebelbranch, on 10/12/2007, -4/+12A better indicator of competitiveness is what country has the best financial returns for the lowest amount of risk. And that country is, and has been since 1945, the United States. Granted we have a lot of debt, but one reason we do is because we can - other nations and foreign investors flock to US markets because their returns are higher and more stable invested in US Dollar based securities. This guy has a clear agenda, but it's not based in reality.
- Zique, on 10/12/2007, -0/+1And what about the 10%+ returns investors get from Eastern Europe and Asia? Or basically the same percentage of return you can get from West Europe and Japan?
- Aelbric, on 10/12/2007, -3/+13The article does make one compelling statement: "This isn't an economic argument so much as a political one."
Other than that the whole thing is garbage. The "burdens of regulation, taxation, litigation and health care are even greater than they were in 2002" yet a business policy of anti-government, anti-tax, anti-regulation will bury the US economy? I call shenanigans. - secondmode, on 10/12/2007, -4/+10Biased.
- Zique, on 10/12/2007, -0/+1Is that why they had USA at #1 spot last year?
- Popcan, on 10/12/2007, -3/+12"Business taxes, as a percentage of anything you want to measure, are at their lowest level in decades"
Why does everyone hate business so much? They employ just about everyone and produce just about everything you buy. Lets tax them out of existence and see how great the economy is then.- dahat, on 10/12/2007, -2/+5I'm still waiting for a Bolsheviks to say: "The workers must control the means of production!"
- h00paj00, on 10/12/2007, -1/+4Because "they" want everyone to be 100% employed by the government. Even if that "employment" is sitting on your ass waiting for your "gubment" check. Talk about slavery!
- Brackhar, on 10/12/2007, -1/+10"...Having raised the issue, however, it is hypocritical for the business lobby to oppose any tax increase that might be used to socialize these costs. Their phony solution -- that average Americans should essentially fund their own pensions and health care, with no increase in wages -- is so unfair and unreliable that Americans have roundly rejected it."
So the writer makes the complaint that it's unfair to have workers choose and pay for their own pension and health care plans without an increase in pay, but he then argues for decreasing workers pay arbitrarily (by levying a new tax/ increasing old taxes) to force the worker to accept a plan without any choice?
Huh?
Very loaded article, in my view. Economics is not on the side of the writer, but as stated, "This is not so much an economic argument as a political one."- mpeg2tom, on 10/12/2007, -1/+2The rise in the US cost of health care tracks very well with the rise in the expansion of government subsidization of health care. 50% of US health care spending is now government spending. When you subsidize something through giving money to the consumer, demand rises. When demand rises and supplies remain about the same, price rises.
If you really want lower health care prices, government needs to end Medicare, which will reduce the demand for health care, of course then some poorer older folks might not get as much health care.
OK, maybe you don't like that. Then we can lower health care prices through price controls (like socialized health care). That will also reduce supply below demand, leading to shortages, but hey all those other countries have fewer MRIs and people need to wait longer for certain services.
OK, maybe that sucks as well. We could dramaticaly expand the supply of health care workers by allowing any health care worker on the planet to immigrate to the U.S. That would increase the supply of health care, reducing what doctors make, probably also reducing average doctor practice quality.
Well, those are your options, there is no such thing as a free lunch! Well, except in the minds of politicians. - drake546, on 10/12/2007, -0/+0I dont think I'd like to go to a doctor who got his certificate in a country I've never heard of. But thats just me.
- mpeg2tom, on 10/12/2007, -1/+2The rise in the US cost of health care tracks very well with the rise in the expansion of government subsidization of health care. 50% of US health care spending is now government spending. When you subsidize something through giving money to the consumer, demand rises. When demand rises and supplies remain about the same, price rises.
- JSatt, on 10/12/2007, -7/+5"These reports speak to the embarrassing failure of a decade of Republican rule"????
Do you fools forget that the "Republican rule" brought us out of the recesion that Clinton left us in and has kept us out ever since. No we probably aren't the #1 economy anymore, but we're a hell of a lot better off than when Clinton left office. At least things are looking up.- gropo, on 10/12/2007, -9/+7Seriously... "we're a hell of a lot better off than when Clinton left office." !?
Are you completely ignorant of the national debt trajectory? Or just negligent? - dahat, on 10/12/2007, -12/+7@gropo
So... you'd prefer that we avoid wars so as to stay out of debt?
If that is the case... I hope you've practiced your Arabic and are teaching your children such key phrases such as Allahu Akbar and La Ellah Ela Allah... because it is this very war and debt that will keep you and your children from being forced to worship the moon god at the point of a gun.
Personally... I'd prefer to live free and be in debt, than to be a slave and a perfectly balanced budget. - supergnome, on 10/12/2007, -4/+2@dahat
Ooh, somebody drank the Kool-aid ...
- gropo, on 10/12/2007, -9/+7Seriously... "we're a hell of a lot better off than when Clinton left office." !?
- chalkboy, on 10/12/2007, -8/+1Idiots!!!
- icepick314, on 10/12/2007, -5/+6gee...and aren't we close to breaking record in Dow Jones Index?
this is why i hate liberal media...spinning news out of control.... - lebaige, on 10/12/2007, -1/+10That isn't a news aricle, it's an op-ed piece. Steve Pearlstein is a self admitted liberal and has written from the liberal point of view since his days at the Boston Globe. Doesn't exactly make him wrong, but it doesn't make his opinion news either.
- cdog12, on 10/12/2007, -1/+6This article is laughable at best. He only cites one "study" and all it is a ranking, now I'm not familiar with the ins and outs of this ranking, but if it's anything like any other ranking, it's subjective. There are hundreds of great examples of how rankings don't really work well unless they are based on actual facts so I need not mention them.
The second "study" hadn't even come out yet and all it was saying that the outside factors facing businesses are greater than they were. You don't have to have an MBA to know that prices/taxes/government pressure will increase over four years. If anyone knows of four years when this didn't happened that weren't a depression then let the writer know.
This seemed like a political article with a hint of economics fiction thrown in to make it seem credible. Why not just write an editorial on his political views instead of trashing his credibility before the story even began? - IanRReardon, on 10/12/2007, -3/+6How convenient, a Scandinavian report that lists Scandinavian countries as the top in the world.
- theodicey, on 10/12/2007, -1/+4
Switzerland /= Scandinavia.
Which reminds me, the chronically underfunded US educational system sucks too -- maybe that has something to do with our lack of competitiveness. - axxiom, on 10/12/2007, -0/+3To: theodicey
US education puts 'feelings' above Geography. I'm not even sure if Geography is required anymore. I can count the number of times Geography was brought up in my selection of college courses with my guidance counselor with one hand. And I have been to four different colleges. - Zique, on 10/12/2007, -0/+1Oh god, another one who confuses Switzerland with Sweden.
Also, if you'd do a little research you would find out that World Economic Forum members are from all over the world, and they also hold meeting at random intervals outside Switzerland several times a year. If you don't believe the results, try to refute them, but don't make wild, baseless claims about bias. - drake546, on 10/12/2007, -0/+0I totally agree that the US public education system is a god forsaken mess which punishes competivness, bores its students, and treats them like little criminals in a prison.
Our schools have zero accountability to the quality of their education. And until recently the worse a school did, the MORE money they got. Massive amounts of waste exist within an evergrowing beuracracy of well paid management who never see a classroom and underpaid overworked teachers who have been given an insane curriculum that is destroying the United State's workforce.
- theodicey, on 10/12/2007, -1/+4
- jtrost, on 10/12/2007, -1/+2How the US economy ranks relative to other countries isn't all that important. Look at Sweeden. They're not number 1 and they're doing just fine.
- Jawood, on 10/12/2007, -5/+3""Look at Sweden. They're not number 1 and they're doing just fine."
Yeah, and they don't have to worry about some nut jobs with bombs who want to kill them just because they're Swedish, because of their foreign policy, or because they're in the "Holy Land".
- Jawood, on 10/12/2007, -5/+3""Look at Sweden. They're not number 1 and they're doing just fine."
- sjbdallas, on 10/12/2007, -1/+6I don't even see what the criteria is for the WEF rankings. This is an OPINION piece using the one report the author could find that seemed to support his beliefs. As someone else stated: non-story.
- SteelChicken, on 10/12/2007, -2/+10@galore
"Have you ever been to England or France?
For an interesting exercise:
Please drive through the US, e.g. Dallas to Chicago, and look at all the poverty, the run down small towns, the trailer shacks, the abandoned, deteriorating buildings.
And then drive from Nice, France to London, England. Then tell me who is left in the dust."
be sure to stop by all those little suburbs around paris where all the north african/arabic people live with 30%+ unemployment, ummmkay?
just because the US doesn't beleive in spending huge amounts of money propping up the poor doesn't mean anything. Opportunities exist for those willing to seek them. - Roppongi, on 10/12/2007, -6/+3The article makes sense to me. The US economy is a juggernaut no doubt. But its liabilities are tremendous. By lowering taxes at the same time as fighting a war, Bush has run up 3 trillion ( TRILLION ) in additional debt. The twin deficits ( spending and trade ) are astronomical. There's no recognition these are a problem or plan to deal with them. The US dollar is down, consumer debt is up, medical costs are spiraling upward, social security is underfunded and broken, and the rich get richer while the poor get poorer.
Why does it seem the goverments of other countries can deal with real problems while we can't in the US?- Jawood, on 10/12/2007, -1/+4*Why does it seem the governments of other countries can deal with real problems while we can't in the US?*
We're dealing with the problems our way and they're dealing with theirs their way. I'm not sure who's doing a better job. I guess that depends on your metric for better.
Entrepreneurship? The US is still much better than most of Europe.
Helping the poor? I think Europe's got us there.
Health care? Europe again.
Taxation? We win - we keep more of our money.
Employment? God! We got them soooo beat on that one. I mean, young folks actually dream about working for the Government! How pathetic is that!
I don't know, what else?
- Jawood, on 10/12/2007, -1/+4*Why does it seem the governments of other countries can deal with real problems while we can't in the US?*
- PepeGSay, on 10/12/2007, -2/+5If you guys think this is anything but politically motivated economic quackery then you need your head examined.
- jgo6d, on 10/12/2007, -2/+2@PepeGSay (and others)
That's pretty cool that things are so stark, so black and white for you. I wish I had the inability to see any shades of gray. It's amazing that all of the intricacies of these issues just sort of melt away for you so that you can see right to the heart of the issue.
- jgo6d, on 10/12/2007, -2/+2@PepeGSay (and others)
- miket, on 10/12/2007, -3/+4buried for spreading FUD
- 2ndRevolution, on 10/12/2007, -2/+6Sooo, we tax the ***** out of businesses (who will pass on the cost to consumers), tax the ***** out of the populace and then let the government become the driving force of our economy? Did I read that correctly?
Hmm, ah, so we should become a socialist country. Our government has more than proven it is incapable of handling finances well. Whoops, now where did that 2.3 TRILLION go? Ah, who cares. We'll just print more.
So the cure would be to give the government more tax money to squander???
*****.- jgo6d, on 10/12/2007, -0/+4"Sooo, we tax the ***** out of businesses (who will pass on the cost to consumers), tax the ***** out of the populace and then let the government become the driving force of our economy? Did I read that correctly?"
No, I don't think you did. I know that is what you wanted the article to say, because that makes the straw man all the more easy for you to attack. The article may have been biased, but that's sort of like the pot calling the kettle black, isn't it?
Regardless, the benefits of laissez faire economics versus corporate responsibility are something that have to be weighed in a more pragmatic fashion. Your rhetoric does little to get us to an equitable solution.
What the article does is bring up some points that are worth some consideration: Do we want to sacrifice legal recourse and consumer rights in order to give business an unfettered path to fiscal success? What kind of responsibilty does business have to the country and people that it uses to succeed? Are we too quick to assume that incresed taxes necessarily hold back economic growth?
Your answers may differ from mine, but the questions are not nearly as asinine as you make them out to be.
- jgo6d, on 10/12/2007, -0/+4"Sooo, we tax the ***** out of businesses (who will pass on the cost to consumers), tax the ***** out of the populace and then let the government become the driving force of our economy? Did I read that correctly?"
- austindkelly, on 10/12/2007, -0/+1it is just not that simple.
- srodolff, on 10/12/2007, -1/+4You mean that we may no longer have to foot the bill for the world's ills????
Sign me up!!!!- supergnome, on 10/12/2007, -2/+2@srodolff
Only if you stop causing them. - Pootle4rthur, on 10/12/2007, -1/+2the US corporations cause far more of the problems than the US solves.
Almost all US foreign policy is driven by Economic imperialism, much like the British did when they were the worlds largest power.
Every popular revolution where US corporations have had "their" assets nationalised, has then been subjected to CIA interference, as there's one thing empires can't stand and that's independently minded populism undermining it's economic stranglehold
- supergnome, on 10/12/2007, -2/+2@srodolff
- Buelldozer, on 10/12/2007, -2/+6Arrrrghhhh, there should be NO business taxes. Period!
A tax on a business is simply a hidden tax on the people!
Eliminate business taxes and let people see how much they are REALLY paying to the government! - geronimo, on 10/12/2007, -0/+5This is why the U.S. dropped:
http://www.weforum.org/en/fp/gcr_2006-07_highlights/index.htm
The United States, previously in first place, continues to enjoy an excellent business environment, efficient markets and is a global centre for technology development. However, its overall competitiveness is threatened by large macroeconomic imbalances, particularly rising levels of public indebtedness associated with repeated fiscal deficits. Its relative ranking remains vulnerable to a possible disorderly adjustment of such imbalances, including historically high trade deficits.
That isn't politically motivated, that's just sound business. The U.S. just like every other country is subject to international finance, bond market, etc. The U.S., with the largest trade imbalance, coupled with a very high debt load plus a sinking currency, is not a Special Case. The U.S. could pull an Argentina just like every other country in the world can.
Just look at what the fed is telling us: the want to raise rates badly in order to finance govt debt, but they can't currently. Unfortunately, with generals demanding more money and the printing presses reluctant to continue printing, the next option is the international bond markets, and that requires higher interest rates. We're facing a situation where we either continue reckless spending by the government and risk a recession(if we're not in one already) or we control spending. Instead we spend like a drunken sailor.
Iceland has also been penalized for exactly this. USA is no different. The global elite could easily abandon the USA. China exports more goods to Europe compared t othe USA. This report is a wakeup call, choose to ignore it if you wish.- Aelbric, on 10/12/2007, -1/+4Your analysis is clear, concise, informative and insightful. The original article is still political and biased *****.
- geronimo, on 10/12/2007, -1/+4The original article was terrible and very biased. I'm not sure if I sounded biased but I tried not to be. Read up on "The Coming Generational Storm" if you want to read about this at a more in depth level. Another goodie is "And the Money Kept Rolling In" which details Argentina's latest downward spiral.
- axxiom, on 10/12/2007, -1/+1Our trade deficit is exacerbated by the consistent increase in energy imports. One problem here, our energy imports are coming from nations that generally maintain trade surpluses as a direct result of their energy exports. Their trade surpluses must do something. Since energy trades are conducted in US dollars, their surplus is an excess of US dollars. What do they do with the US dollars? They buy US Treasury securities.
From a casual observer, it looks like a quid pro quo scenario. The US continues to ignore it's own energy crisis, imports more energy, and the nations we import from use their surplus to buy our debt, financed by issuing securities through the US Treasury.
This model has worked. Arthur Laffler was widely criticized for espousing the theory that trade deficits, and budget deficits, were not the disasters that economists believed them to be. For nearly 25 years now the US has found a way to make the model function, while increasing dependence on the United States economy by strengthening the value of our debt. The best investment a nation can make is in US dollars. George Soros has been pushing energy exporting nations to conduct their trades in Euros. He believes this will migrate the best currency investment from US dollars to Euros, and by extension shift economic superiority from the US to the European Union.
Energy exporting nations hear Soros out, but I think they generally laugh in his direction. the EU is far too regulated, volatile, and susceptible to clashes among close proximity nations compared to the very safe, porous, North American continent where the US plays among three nations.
- tmgriggs, on 10/12/2007, -1/+4Man, you guys must still have peach fuzz on your butt. I have seen the market climb on many different scenarios only to fall again. It is a natural cycle. The market chases trends and that will cause fluctuations on its own. The market has nothing to do with how healthy the country is or how well the average American is doing financially.
Step back and think. Does the market really reduce deficit? No. Tax revenues reduce the deficit. The last true bull was based on the Internet bubble. We had the highest employment figures in history and a reasonable tax structure. We very nearly wiped out the deficits that Reagan and Bush senior left us. Then the bubble burst, 9/11, Bush Jr.'s tax cuts, war in Afghanistan and now disaster money pit war in Iraq.
When we raise taxes back to pre-Bush levels, stop the exportation of American jobs to other countries where support oppressive government regimes, close the border and demand taxes paid from illegal immigrants that are here and clean up the mess in Iraq then we will increase employment at home which increase tax revenues and pay off our debt so we can afford to fund a full prosecution of the war against the terrorists. You know the ones who really attacked us?
Stop listening to the conservative and liberal talking heads and use your minds. Matadon you are using your noggin. Canti you are thinking correctly but we should not pull out but increase our forces to ensure success. Popcan, I hope you never have a serious medical problem. Without insurance and even with it, it can destroy you financially.
Finally, everyone has to pay taxes, businesses and citizens. Remember a corporation is viewed by the law as a person. That person owes taxes just like I do. Do I wan to pay them? No. But my $600 tax cut would be better spent by reducing the deficit and supporting our war efforts.
- axxiom, on 10/12/2007, -2/+2How do I, the consumer, pass along my tax burden to businesses?
Businesses are not people. Their tax burden is entirely different from mine.
Tax revenue has increased since the Congress cut taxes. The same event occurred when Reagans tax cuts were made. The Laffler curve is a J. Tax revenue declines at first, then increases over time as the investments made from the tax savings are pumped into the economy. - snowwrestler, on 10/12/2007, -1/+0@axxiom
Your tax burden is passed on to businesses in two ways. First, individual taxes reduce the number of workers a business can hire with a given cash flow, because they must compensate for the taxes in providing you your net pay (buying power).
Second, individual taxes reduce the amount of goods and services individuals can buy from businesses, reducing their gross income and their cash flow.
Dollars flow in a circle, not a line. You might say that businesses should not be taxed because they pass their costs onto consumers. I could say that ONLY businesses should be taxed because they will find the most efficient way pass on that cost.
Furthermore dollars do not disappear from the economy when they are taken as taxes--not all of them anyway. Most are returned to the economy within 1 year through purchases and salaries. The dollars that DO disappear are the ones that are used to service foreign debt. From this (simplistic) picture, it follows that it is in our best interest to avoid foreign debt, even if doing so necessitates higher taxes. A government run in the black is a lighter burden on the national economy than one financed by foreign investments.
As for the Laffer curve you are just about as wrong as you can get. It is not a "J"--what you are referring to is the per-year graph of revenues, The Laffer curve is a rough plateau...all we know for sure is that there are null values on either end (both 0% and 100% taxation produce 0 revenues). Furthermore the Laffer theory is about tax revenue *maximization*, not merely increase. Growing tax revenues are not proof of maximization; all they prove is that we have not hit the lower boundary of the curve. Most government economists believe that we would in fact greatly increase tax revenues if tax rates were increased.
- axxiom, on 10/12/2007, -2/+2How do I, the consumer, pass along my tax burden to businesses?
- thomasdt12, on 10/12/2007, -1/+2A decently executed Flat Tax system would help the US growth. Unfortunately, there are many accountants and lawyers that would have to find other things to do. The cost of preparing and documenting current taxes per year is billions of dollars.
It would give a boost to the economy by considerably improving incentives to work, save, invest and take entrepreneurial risks. The flat tax would also shift billions from investments that help people to avoid taxes, to those that produce goods and
services.
http://www.heritage.org/Research/Taxes/BG1107.cfm - tricyclethief, on 10/12/2007, -1/+2This is article is nothing more than an anti-Bush rant, and while I'm not crazy about Bush, this article should not be reported as news.
- axxiom, on 10/12/2007, -1/+3I didn't think the article was opinion at first, but as you finish it you realize that it is nearly entirely opinion. The author is using selective sources and not examing counter evidence that would indicate it's reporting nature over it's opinion nature.
- Terradeamon, on 10/12/2007, -3/+1Quote "Popcan" *The United States of America has the best health care in the world*
Now that is the biggest pile off ***** i have read today.
The American health system is a joke in most I-country's around the world, ***** i can get better health care in some U-countries. if you are a rich American sure you can get good medicare but fore the average Joe its *****, and expensive.
yea taxes suck but its better then the alternative
US Economy: No Longer No. 1,? wtf, the us economy have not been 1 since shortly after WW2. What are your propaganda machine feeding you?
Am sorry if am offend anyone but some off the comments got me really ***** mad.- axxiom, on 10/12/2007, -1/+1Why do the comments make you so mad?
Other ideas aren't supposed to make you so angry. They're supposed to make you think.
- axxiom, on 10/12/2007, -1/+1Why do the comments make you so mad?
- SuckItUp, on 10/12/2007, -2/+2Just another article trying to bash the Republicans (who I really do not like), but I fear the Democrats way way more.
To put it simply, do you want oral sex from the Republicans or anal from the Democrats? - tracysurf, on 10/12/2007, -1/+1That's not news, it reads as a biased op ed.
- trip210, on 10/12/2007, -3/+1I guess no one remembers the fact that the Bush tax cut boosted goverment revenue in an unexpected (to liberals) way. The idea of raising taxes to increase revenue is shortsighted in the least. You have to consider what that money would be used for if not collected by the government. In the cases of businesses, this is typically expansion which leads to job creation and more taxes. The government gets their money in the long run and our economy prospers. Speaking of tax cuts, do any of you realize that the tax burden as a percentage of federal revenue on the lower 50% of wage-earners has dropped to it's lowest level of 3.46% For those who have a hard time with numbers, that means that the top 50% of wage earners pay 96.54% of federal taxes. That flies in the face of "only the poor pay taxes" or "tax cuts only helped the rich." Too bad dems have to rely on uninformed voters and operate under the rule "If you tell a lie often enough people will start to believe you."
- buckynekkid, on 10/12/2007, -2/+1I remember Bush's tax cut, and his theory on why it would stimulate the economy. It's called trickle-down economics and it has been proven to NOT work. Need proof? Look up Reagan the administration, or read in the article above about how we use to be close to #1, but now we're #6.
- strebormj, on 10/12/2007, -1/+2"Republican rule" in the sense of having a narrow majority, a partisan, antagonistic minority party voting against everything, a Democrat-dominated media misrepresenting everything to the public, and the fact that the Republican Party of today has more in common with the Democratic Party than it does the Republican Party of 30 years ago.
Regardless of campaign promises, which has furthered the following supposedly liberal policies?
Increased third-world immigration? Both.
Increased tax burden? Both.
Increased socialization of private services? Both.
Increased government control of your life? Both.
Which is heavily influenced and funded by large corporations and radical, pro-semitic interests, including AIPAC? Both.
Which is full of fat, corrupt kakistocrats taking kickbacks for large pork barrel projects? Both.
The only difference between the two is one of degree. Both parties have been hijacked and are increasingly following different versions of a radical, pro-semitic agenda. One wants to divest Americans of their property and individual rights; the other wants Americans to die fighting Israel's enemies. Both parties are increasingly selling out to foreign corporations.
So, let's hear it for that "Republican rule."- Aelbric, on 10/12/2007, -1/+1You had my attention right up to "pro-semitic". Anyone who is racially biased in any direction can leave the planet right now as far as I'm concerned.
- dclowd9901, on 10/12/2007, -1/+2I thought p9 left digg...
- tmgriggs, on 10/12/2007, -1/+1Streb you need to just shut up. Nobody wants to hear that anti-Semitic *****. All this has to do with is not understanding how the economy works. Axxiom close your Econ 102 book and listen. Government pays off it's debts with revenue from tax collection. If business does not pay taxes, and rich people don't pay their fair share, and if you give everybody a tax cut.
The government can't pay for soldiers and fancy new weapon systems and yes even the people on assistance. Look around at our infrastructure it is *****. Our industrial jobs are leaving at an alarming rate. When is the last time you called for customer service and spoke to someone in the US? You cannot do away with manufacturing jobs. Only a small percentage of Americans are college graduates. The rest are not prepared for the technological jobs that are suppose to be prevalent. And running the register at McDonald's is not a technology job.
We cannot continue to borrow billions from the Chinese. We cannot base our entire transportation and energy on system on oil and gas that comes from unstable countries. Wake the hell up! This cannot continue.- axxiom, on 10/12/2007, -0/+3"If business does not pay taxes, and rich people don't pay their fair share, and if you give everybody a tax cut."
I think you forgot to finish this thought.
It cannot be infrastructure. You don't need infrastructure to operate customer service positions.
China has horrible infrastructure. Their logistics are among the worst in the world. For the size of their economy their logistical structure is by far the worst. They're consuming the most concrete, which they import, because they are trying to improve their logistical infrastructure. They know it is bad and can be improved. US industry, and American workers, are helping them do that. It's one of our chief exports, brains and experience.
The US focuses a lot of education on college when in reality a lot of jobs are better served through trade schools. Private, for profit, schools like DeVry and ITT, have literally controlled the trade school market in the US because so few wish to compete with them. Other trade schools are very small, and/or regionally based to serve area industries that need skilled workers.
India and China both follow a european model that emphasizes trade schools as a means to increase the living standards of workers.
The US problem is our energy crisis. We're doing a poor job of putting our natural resources to work to solve our energy crisis. We have many sources of energy. We are just failing to grasp their power. When we start addressing our energy problems we will start to see a dramatic shift in the trade deficit, and budget deficit.
- axxiom, on 10/12/2007, -0/+3"If business does not pay taxes, and rich people don't pay their fair share, and if you give everybody a tax cut."
- truck87bp, on 10/12/2007, -1/+2I met a new Immigrant that said he bought an American Car because he wanted to support America...he's so smart.
Military Manufacturing and Automobile Manufacturing are the only BIG Industries that we have left in the US. Buy more Import cars and watch things get worse. US cars are manufactured in every other state in the union. Fact: Lose 1 auto job and put 6 non-related people out of work. Hollywood and Bad News Reporting about US Auto Quality is the biggest offender to the demise of Jobs in the US.
Come on people....WAKE UP ! or will be just a war machine...right now the machine is supporting the economy...time for you to support the Auto Industry whether you like it or not and put more jobs in your state.- thomasdt12, on 10/12/2007, -0/+1I own a Dodge Charger, a Chrysler product so I support American manufacturers. Oh wait, it's a German-owned firm now. The 2 American Automobile manufacturers missed the boat on too many occasions. Bashing hybrid vehicles, relying on truck and SUV sales for the bulk of their revenue was vastly short-sighted.
Ford wants to get rid of all the US manufacturing jobs anyways:
http://abcnews.go.com/Business/wireStory?id=2443732
- thomasdt12, on 10/12/2007, -0/+1I own a Dodge Charger, a Chrysler product so I support American manufacturers. Oh wait, it's a German-owned firm now. The 2 American Automobile manufacturers missed the boat on too many occasions. Bashing hybrid vehicles, relying on truck and SUV sales for the bulk of their revenue was vastly short-sighted.
- NapoleonGold, on 10/12/2007, -2/+4hahahahha
Once again "reported as innaccurate"
HOW???????
You guys kill me.- geekee, on 10/12/2007, -1/+3"These reports speak to the embarrassing failure of a decade of Republican rule in improving U.S. competitiveness."
inaccurate
- geekee, on 10/12/2007, -1/+3"These reports speak to the embarrassing failure of a decade of Republican rule in improving U.S. competitiveness."
- geekee, on 10/12/2007, -1/+2http://money.cnn.com/2006/09/27/markets/markets_1120/index.htm?cnn=yes
Dow flirts with record -
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