On January 28 2012 13:30 Zealotdriver wrote: LOL at Newt Gingrich's moon base. LOL at Mitt Romney's tax returns. LOL at Ron Paul's racist newsletters. I'm waiting for the real republican candidate to come out of the woodwork midway through the campaign.
Wait... did you say moon base? How did that ever come up!
There were some decent candidates at the start were there not? Just going from what I've heard Huntsman was portrayed as not being insane at the very least which is very much a plus point.
Earlier in the thread there is a video of gingrich telling supporters that the United States will have a permanent moon base by the end of his second term.
To be honest, I don't think that building a moonbase is that insane an idea. The united states needs some flagship science/engineering projects to get some public interest into science once again and inspire the public imagination, kind of like what the nuclear program and apollo program did in the 50's/60's.
We would gain nothing by actually having a colony on the moon.
On January 28 2012 13:30 Zealotdriver wrote: LOL at Newt Gingrich's moon base. LOL at Mitt Romney's tax returns. LOL at Ron Paul's racist newsletters. I'm waiting for the real republican candidate to come out of the woodwork midway through the campaign.
Wait... did you say moon base? How did that ever come up!
There were some decent candidates at the start were there not? Just going from what I've heard Huntsman was portrayed as not being insane at the very least which is very much a plus point.
Earlier in the thread there is a video of gingrich telling supporters that the United States will have a permanent moon base by the end of his second term.
To be honest, I don't think that building a moonbase is that insane an idea. The united states needs some flagship science/engineering projects to get some public interest into science once again and inspire the public imagination, kind of like what the nuclear program and apollo program did in the 50's/60's.
We would gain nothing by actually having a colony on the moon.
Don't forget a 51st state.
Sorry, DC/PR.
I would argue that there is a lot that we can learn by having a base on the moon. However, the way he sells it is just stupid. We should establish one up there in the name of science and technology, not as a pick "**** you!" to the rest of the world.
On January 28 2012 13:30 Zealotdriver wrote: LOL at Newt Gingrich's moon base. LOL at Mitt Romney's tax returns. LOL at Ron Paul's racist newsletters. I'm waiting for the real republican candidate to come out of the woodwork midway through the campaign.
Wait... did you say moon base? How did that ever come up!
There were some decent candidates at the start were there not? Just going from what I've heard Huntsman was portrayed as not being insane at the very least which is very much a plus point.
Earlier in the thread there is a video of gingrich telling supporters that the United States will have a permanent moon base by the end of his second term.
To be honest, I don't think that building a moonbase is that insane an idea. The united states needs some flagship science/engineering projects to get some public interest into science once again and inspire the public imagination, kind of like what the nuclear program and apollo program did in the 50's/60's.
We would gain nothing by actually having a colony on the moon.
Don't forget a 51st state.
Sorry, DC/PR.
I would argue that there is a lot that we can learn by having a base on the moon. However, the way he sells it is just stupid. We should establish one up there in the name of science and technology, not as a pick "**** you!" to the rest of the world.
That being said wasn't the 'space race' between the USA and the USSR essentially a pissing contest?
I'd be for it if it proved to have actual scientific value, but my limited understanding is that having a manned presence in areas such as the moon isn't really necessary scientificially as we can use remote probes and whatnot.
moon base would be so cool. this is the kind of stuff that inspired us when we were young and encouraged us to chase our dreams but now as the years passed the governments support of the space program has stagnated to nothing.
On January 28 2012 13:30 Zealotdriver wrote: LOL at Newt Gingrich's moon base. LOL at Mitt Romney's tax returns. LOL at Ron Paul's racist newsletters. I'm waiting for the real republican candidate to come out of the woodwork midway through the campaign.
Wait... did you say moon base? How did that ever come up!
There were some decent candidates at the start were there not? Just going from what I've heard Huntsman was portrayed as not being insane at the very least which is very much a plus point.
Earlier in the thread there is a video of gingrich telling supporters that the United States will have a permanent moon base by the end of his second term.
To be honest, I don't think that building a moonbase is that insane an idea. The united states needs some flagship science/engineering projects to get some public interest into science once again and inspire the public imagination, kind of like what the nuclear program and apollo program did in the 50's/60's.
We would gain nothing by actually having a colony on the moon.
Don't forget a 51st state.
Sorry, DC/PR.
I would argue that there is a lot that we can learn by having a base on the moon. However, the way he sells it is just stupid. We should establish one up there in the name of science and technology, not as a pick "**** you!" to the rest of the world.
That being said wasn't the 'space race' between the USA and the USSR essentially a pissing contest?
I'd be for it if it proved to have actual scientific value, but my limited understanding is that having a manned presence in areas such as the moon isn't really necessary scientificially as we can use remote probes and whatnot.
Well, we did retrieve a lot of rock samples that had all sorts of tests done to them.
On January 28 2012 14:47 Terranist wrote: moon base would be so cool. this is the kind of stuff that inspired us when we were young and encouraged us to chase our dreams but now as the years passed the governments support of the space program has stagnated to nothing.
I actually find the progress of privately funded space programs far more interesting than I ever did apollo. If space travel was made profitable, that would be truly amazing, and as a republican I think Gingrich should have the same position. The role of the government is not to fund cool science projects that make the people happy and no president should be elected on the basis of such a ridiculous promise.
On January 28 2012 14:47 Terranist wrote: moon base would be so cool. this is the kind of stuff that inspired us when we were young and encouraged us to chase our dreams but now as the years passed the governments support of the space program has stagnated to nothing.
I actually find the progress of privately funded space programs far more interesting than I ever did apollo. If space travel was made profitable, that would be truly amazing, and as a republican I think Gingrich should have the same position. The role of the government is not to fund cool science projects that make the people happy and no president should be elected on the basis of such a ridiculous promise.
Umm... sometimes the people are a little short-sighted. Do you really think without the government's involvement in space exploration private companies would have done anything? No. Businesses will only ever care about profit, not the advancement of our species. Thus it falls upon the government to do some things for us. If you believe government shouldn't be involved in things like that, ok. Just realize that advancement drops off significantly when businesses run everything.
On January 28 2012 14:47 Terranist wrote: moon base would be so cool. this is the kind of stuff that inspired us when we were young and encouraged us to chase our dreams but now as the years passed the governments support of the space program has stagnated to nothing.
I actually find the progress of privately funded space programs far more interesting than I ever did apollo. If space travel was made profitable, that would be truly amazing, and as a republican I think Gingrich should have the same position. The role of the government is not to fund cool science projects that make the people happy and no president should be elected on the basis of such a ridiculous promise.
Umm... sometimes the people are a little short-sighted. Do you really think without the government's involvement in space exploration private companies would have done anything? No. Businesses will only ever care about profit, not the advancement of our species. Thus it falls upon the government to do some things for us. If you believe government shouldn't be involved in things like that, ok. Just realize that advancement drops off significantly when businesses run everything.
Mathematically speaking, I am pretty sure that short-term profits are often times more important/valuable than long-term investments, which is a big reason for this. Not that I am arguing, I totally agree with you. I'm just giving reasoning for why this is the case. Businesses will not advance societies. It takes a more unified, forward thinking type of thinking that is only concerned with progress to do things like reach the moon.
The private sector has its place, but in terms of the advancement of our society, its the sort of thing that the scientific community and/or the government is able to do.
On January 28 2012 14:47 Terranist wrote: moon base would be so cool. this is the kind of stuff that inspired us when we were young and encouraged us to chase our dreams but now as the years passed the governments support of the space program has stagnated to nothing.
I actually find the progress of privately funded space programs far more interesting than I ever did apollo. If space travel was made profitable, that would be truly amazing, and as a republican I think Gingrich should have the same position. The role of the government is not to fund cool science projects that make the people happy and no president should be elected on the basis of such a ridiculous promise.
Umm... sometimes the people are a little short-sighted. Do you really think without the government's involvement in space exploration private companies would have done anything? No. Businesses will only ever care about profit, not the advancement of our species. Thus it falls upon the government to do some things for us. If you believe government shouldn't be involved in things like that, ok. Just realize that advancement drops off significantly when businesses run everything.
Mathematically speaking, I am pretty sure that short-term profits are often times more important/valuable than long-term investments, which is a big reason for this. Not that I am arguing, I totally agree with you. I'm just giving reasoning for why this is the case. Businesses will not advance societies. It takes a more unified, forward thinking type of thinking that is only concerned with progress to do things like reach the moon.
The private sector has its place, but in terms of the advancement of our society, its the sort of thing that the scientific community and/or the government is able to do.
Ya right, cause most of our technology was invented by governments and not individuals working freely -.-.
On January 28 2012 14:47 Terranist wrote: moon base would be so cool. this is the kind of stuff that inspired us when we were young and encouraged us to chase our dreams but now as the years passed the governments support of the space program has stagnated to nothing.
I actually find the progress of privately funded space programs far more interesting than I ever did apollo. If space travel was made profitable, that would be truly amazing, and as a republican I think Gingrich should have the same position. The role of the government is not to fund cool science projects that make the people happy and no president should be elected on the basis of such a ridiculous promise.
Umm... sometimes the people are a little short-sighted. Do you really think without the government's involvement in space exploration private companies would have done anything? No. Businesses will only ever care about profit, not the advancement of our species. Thus it falls upon the government to do some things for us. If you believe government shouldn't be involved in things like that, ok. Just realize that advancement drops off significantly when businesses run everything.
Mathematically speaking, I am pretty sure that short-term profits are often times more important/valuable than long-term investments, which is a big reason for this. Not that I am arguing, I totally agree with you. I'm just giving reasoning for why this is the case. Businesses will not advance societies. It takes a more unified, forward thinking type of thinking that is only concerned with progress to do things like reach the moon.
The private sector has its place, but in terms of the advancement of our society, its the sort of thing that the scientific community and/or the government is able to do.
Ya right, cause most of our technology was invented by governments and not individuals working freely -.-.
Most major advances in medicine, such as the polio vaccine, come from University research, which owes a good deal to government funding. Very few medical advances of any noteworthiness have come from purely-private research. It isn't profitable to spend money throwing darts at the wall. Companies only fund research that has probable results.
Major advances in science have often come from government-funded research. Advances in consumer technology come more from private enterprise.
Your post seems to suggest that governments and "individuals working freely" are exclusive from each other. The reality is, they depend on each other. Far-reaching research by individuals requires non-profit funding.
Think about NASA and CERN. The Hubble Telescope, and the Large Haladron Collidor. So much of tomorrow's technology comes from government research. How can you not think that almost everything we know about science has come from academia, which has always required some level of government-funding? Also, NASA is responsible not just for scientific advances, but some of their stuff does make its way towards consumer products as well. Even things as simple as Velcro, come from this government enterprise. Look at how far physics has come the past few decades. Many major advances in technology in the future years will still owe itself to the public-funding that allows our more brilliant members of society the freedom to work without thoughts of business-applicability.
But America is slipping, because most of are professors are actually immigrated. We don't invest enough in our education, and that's starting to have negative effects. We've taken our scientific "superiority" hugely for granted, and it's becoming a worldwide joke, really.
None of this stuff might be as exciting or applicable as Prozac or your iPhone, but really, it's always been the case that making major advances in technology is not profitable, and has come from public funding. You can't plan a budget around unknowns. Companies will spend on R&D only when it carries small-risk with probable benefits. It's boring. It's good for developing twenty different brands of boner pills. It's not good for real medicine.
On January 27 2012 07:52 Velr wrote: The problem is... That ideology has lead us into this debt crisise in the first place. There is never a "good" time to pay back debt.. Thats why most countries never did it and suddenly.. Oh shit, debt is out of control! (really sherlock? how come...).
The only country in crisis because of high debt is Greece.
You might want to look at other countries with high debt and the prospects for them borrowing in the future.
Portugal is paying 15% on 10 year money now. That is not sustainable.
Japan has over one QUADRILLION yen in public debt. That's over 200% of their GDP. Even though their interest rates are low on that debt, I think it takes something ridiculous like 40% of their government spending to just cover interest payments. Let that sit in your head for a second.
As you can see, countries in crisis like Spain have very low debt level. In fact, Spain ran surpluses (meaning debt was decreasing) before the crisis hit. The debt was not the cause of the Eurozone crisis for all countries except Greece.
And as you've pointed out, Japan's debt level is 200% of GDP and interest rates have over many years been very very low, about 1%. It's sustainable in the sense, that it's been sustained for like 20 years without signs of catastrophe.
When you have to take on more debt to pay down old debt, I consider that a crisis. It's like maxing out a credit card to cover a different credit card. Just because the Eurozone, Japan, etc. have other problems as well doesn't mean that they are not experiencing a debt crisis in addition. When it costs, for example, Italy an additional $20 billion to service their debt if rates go up 1%, that's a problem.
Japan is not floundering because their debt is incredibly internal. However, with the US it is not this way. And that is the reason why we need to cut the shit out of spending and reduce our ridiculous levels of indebtedness, before something goes wrong and/or we get into the spot where we spend too much just to pay off past excessive spending. Talking about lowering taxes and building space stations right now is just outrageous.
Governments do not have to pay back debt in the sense that persons do. Governments always issue bonds, i.e. they are always borrowing, but they do not borrow explicitly to pay interest on debt.
You can cite large numbers all you like, but none of that really matters in terms of economics, it's just for shock value. All that a government needs to do to keep their debt level sustainable is to ensure that GDP growth outpaces the nominal value they have to repay on the debt.
Your facts are not correct. Japan is not experiencing a debt crisis even though their debt is more than 200% of GDP (compared to 140% for Greece and 95% for the US).
If you look at the table I linked above (http://en.wikipedia.org/wiki/Economy_of_the_European_Union#Economies_of_member_states), you'd see that European countries that are in crisis do not have high debt to GDP ratios. Spain for example is only at 60%. They have debt problems now, but these debt problems were not caused by too much debt. The only exception is Greece.
When S&P downgraded European sovereign debt ratings, they put up a FAQ that perfectly summarized the whole crisis and it's real cause: trade imbalances (i.e. wages were too high in countries like Spain and Italy, making their exports noncompetitive) and high private (and not public) debt. Here's what S&P says: + Show Spoiler +
HOW DO WE INTERPRET THE CONCLUSIONS OF THE DECEMBER EUROPEAN SUMMIT?
We have previously stated our belief that an effective strategy that would buoy confidence and lower the currently elevated borrowing costs for European sovereigns could include, for example, a greater pooling of fiscal resources and obligations as well as enhanced mutual budgetary oversight. We have also stated that we believe that a reform process based on a pillar of fiscal austerity alone would risk becoming self-defeating, as domestic demand falls in line with consumer's rising concerns about job security and disposable incomes, eroding national tax revenues.
The outcomes from the EU summit on Dec. 9, 2011, and subsequent statements from policymakers, lead us to believe that the agreement reached has not produced a breakthrough of sufficient size and scope to fully address the eurozone's financial problems. In our opinion, the political agreement does not supply sufficient additional resources or operational flexibility to bolster European rescue operations, or extend enough support for those eurozone sovereigns subjected to heightened market pressures. Instead, it focuses on what we consider to be a one-sided approach by emphasizing fiscal austerity without a strong and consistent program to raise the growth potential of the economies in the eurozone. While some member states have implemented measures on the national level to deregulate internal labor markets, and improve the flexibility of domestic services sectors, these reforms do not appear to us to be coordinated at the supra-national level; as evidence, we would note large and widening discrepancies in activity and unemployment levels among the 17 eurozone member states.
Regarding additional resources, the main enhancement we see has been to bring forward to mid-2012 the start date of the European Stability Mechanism (ESM), the successor vehicle to the European Financial Stability Fund (EFSF). This will marginally increase these official sources' lending capacity from currently €440bn to €500bn. As we noted previously, we expect eurozone policymakers will accord ESM de-facto preferred creditor status in the event of a eurozone sovereign default. We believe that the prospect of subordination to a large creditor, which would have a key role in any future debt rescheduling, would make a lasting contribution to the rise in long-term government bond yields of lower-rated eurozone sovereigns and may reduce their future market access.
We also believe that the agreement is predicated on only a partial recognition of the source of the crisis: that the current financial turmoil stems primarily from fiscal profligacy at the periphery of the eurozone. In our view, however, the financial problems facing the eurozone are as much a consequence of rising external imbalances and divergences in competitiveness between the EMU's core and the so-called "periphery." In our opinion, the eurozone periphery has only been able to bear its underperformance on competitiveness (manifest in sizeable external deficits) because of funding by the banking systems of the more competitive northern eurozone economies. According to our assessment, the political agreement reached at the summit did not contain significant new initiatives to address the near-term funding challenges that have engulfed the eurozone.
The summit focused primarily on a long-term plan to reverse fiscal imbalances. It proposed to enshrine into national legislation requirements for structurally balanced budgets. Certain institutional enhancements have been introduced to strengthen the enforceability of the fiscal rules compared to the Stability and Growth Pact, such as reverse qualified majority voting required to overturn sanctions proposed by the European Commission in case of violations of the broadly balanced budget rules. Notwithstanding this progress, we believe that the enforcement of these measures is far from certain, even if all member states eventually passed respective legislation by parliaments (and by referendum, where this is required). Our assessment is based on several factors, including:
The difficulty of forecasting reliably and precisely structural deficits, which we expect will likely be at the center of any decision on whether to impose sanctions; The ability of individual member states' elected governments to extricate themselves from the external control of the European Commission by withdrawing from the intergovernmental agreement, which will not be part of an EU-wide Treaty; and The possibility that the appropriateness of these fiscal rules may come under scrutiny when a recession may, in the eyes of policymakers, call for fiscal stimulus in order to stabilize demand, which could be precluded by the need to adhere to the requirement to balance budgets.
Details on the exact content and operational procedures of the rules are still to emerge and -- depending on the stringency of the rules -- the process of passing national legislation may run into opposition in some signatory states, which in turn could lower the confidence of investors and the credibility of the agreed policies.
More fundamentally, we believe that the proposed measures do not directly address the core underlying factors that have contributed to the market stress. It is our view that the currently experienced financial stress does not in the first instance result from fiscal mismanagement. This to us is supported by the examples of Spain and Ireland, which ran an average fiscal deficit of 0.4% of GDP and a surplus of 1.6% of GDP, respectively, during the period 1999-2007 (versus a deficit of 2.3% of GDP in the case of Germany), while reducing significantly their public debt ratio during that period. The policies and rules agreed at the summit would not have indicated that the boom-time developments in those countries contained the seeds of the current market turmoil.
While we see a lack of fiscal prudence as having been a major contributing factor to high public debt levels in some countries, such as Greece, we believe that the key underlying issue for the eurozone as a whole is one of a growing divergence in competitiveness between the core and the so-called "periphery." Exacerbated by the rapid expansion of European banks' balance sheets, this has led to large and growing external imbalances, evident in the size of financial sector claims of net capital-exporting banking systems on net importing countries. When the financial markets deteriorated and risk aversion increased, the financing needs of both the public and financial sectors in the "periphery" had to be covered to varying degrees by official funding, including European Central Bank (ECB) liquidity as well as intergovernmental, EFSF, and IMF loans.
Now is the perfect time for the US government to spend more, as interest rates are at a historic low. This opportunity will likely not present itself again. It has never been cheaper for the government to spend.
Fiscal policy (i.e. government spending) should be countercyclical, i.e. increase spending in a recession, and decrease spending in a boom. We are barely recovering from a recession, and with record low interest rates, government should increase spending right now.
Debt is a long term issue. There is no short term deleterious effect caused by increasing debt. In a boom is when government spending should be decreased.
If you want to know what happens when governments cut spending during recessions, look at Europe, that's exactly what they're doing. And it's not ending well.
On January 28 2012 13:30 Zealotdriver wrote: LOL at Newt Gingrich's moon base. LOL at Mitt Romney's tax returns. LOL at Ron Paul's racist newsletters. I'm waiting for the real republican candidate to come out of the woodwork midway through the campaign.
Wait... did you say moon base? How did that ever come up!
There were some decent candidates at the start were there not? Just going from what I've heard Huntsman was portrayed as not being insane at the very least which is very much a plus point.
Earlier in the thread there is a video of gingrich telling supporters that the United States will have a permanent moon base by the end of his second term.
To be honest, I don't think that building a moonbase is that insane an idea. The united states needs some flagship science/engineering projects to get some public interest into science once again and inspire the public imagination, kind of like what the nuclear program and apollo program did in the 50's/60's.
We would gain nothing by actually having a colony on the moon.
Don't forget a 51st state.
Sorry, DC/PR.
I would argue that there is a lot that we can learn by having a base on the moon. However, the way he sells it is just stupid. We should establish one up there in the name of science and technology, not as a pick "**** you!" to the rest of the world.
I'd have to agree the stupid part of Gingrich's point to have a base at a proximal time by China was phrased as a pissing contest, unfortunately you have phrase things in a stupid way to stupid people. I don't think the majority of people have the time, access/clearance or will to look through a long and detailed report that would probably span decades about the future of space colonization like Gingrich's advisors have the luxury or desire to do.
On January 27 2012 07:52 Velr wrote: The problem is... That ideology has lead us into this debt crisise in the first place. There is never a "good" time to pay back debt.. Thats why most countries never did it and suddenly.. Oh shit, debt is out of control! (really sherlock? how come...).
The only country in crisis because of high debt is Greece.
You might want to look at other countries with high debt and the prospects for them borrowing in the future.
Portugal is paying 15% on 10 year money now. That is not sustainable.
Japan has over one QUADRILLION yen in public debt. That's over 200% of their GDP. Even though their interest rates are low on that debt, I think it takes something ridiculous like 40% of their government spending to just cover interest payments. Let that sit in your head for a second.
As you can see, countries in crisis like Spain have very low debt level. In fact, Spain ran surpluses (meaning debt was decreasing) before the crisis hit. The debt was not the cause of the Eurozone crisis for all countries except Greece.
And as you've pointed out, Japan's debt level is 200% of GDP and interest rates have over many years been very very low, about 1%. It's sustainable in the sense, that it's been sustained for like 20 years without signs of catastrophe.
When you have to take on more debt to pay down old debt, I consider that a crisis. It's like maxing out a credit card to cover a different credit card. Just because the Eurozone, Japan, etc. have other problems as well doesn't mean that they are not experiencing a debt crisis in addition. When it costs, for example, Italy an additional $20 billion to service their debt if rates go up 1%, that's a problem.
Japan is not floundering because their debt is incredibly internal. However, with the US it is not this way. And that is the reason why we need to cut the shit out of spending and reduce our ridiculous levels of indebtedness, before something goes wrong and/or we get into the spot where we spend too much just to pay off past excessive spending. Talking about lowering taxes and building space stations right now is just outrageous.
Governments do not have to pay back debt in the sense that persons do. Governments always issue bonds, i.e. they are always borrowing, but they do not borrow explicitly to pay interest on debt.
You can cite large numbers all you like, but none of that really matters in terms of economics, it's just for shock value. All that a government needs to do to keep their debt level sustainable is to ensure that GDP growth outpaces the nominal value they have to repay on the debt.
Your facts are not correct. Japan is not experiencing a debt crisis even though their debt is more than 200% of GDP (compared to 140% for Greece and 95% for the US).
If you look at the table I linked above (http://en.wikipedia.org/wiki/Economy_of_the_European_Union#Economies_of_member_states), you'd see that European countries that are in crisis do not have high debt to GDP ratios. Spain for example is only at 60%. They have debt problems now, but these debt problems were not caused by too much debt. The only exception is Greece.
When S&P downgraded European sovereign debt ratings, they put up a FAQ that perfectly summarized the whole crisis and it's real cause: trade imbalances (i.e. wages were too high in countries like Spain and Italy, making their exports noncompetitive) and high private (and not public) debt. Here's what S&P says: + Show Spoiler +
HOW DO WE INTERPRET THE CONCLUSIONS OF THE DECEMBER EUROPEAN SUMMIT?
We have previously stated our belief that an effective strategy that would buoy confidence and lower the currently elevated borrowing costs for European sovereigns could include, for example, a greater pooling of fiscal resources and obligations as well as enhanced mutual budgetary oversight. We have also stated that we believe that a reform process based on a pillar of fiscal austerity alone would risk becoming self-defeating, as domestic demand falls in line with consumer's rising concerns about job security and disposable incomes, eroding national tax revenues.
The outcomes from the EU summit on Dec. 9, 2011, and subsequent statements from policymakers, lead us to believe that the agreement reached has not produced a breakthrough of sufficient size and scope to fully address the eurozone's financial problems. In our opinion, the political agreement does not supply sufficient additional resources or operational flexibility to bolster European rescue operations, or extend enough support for those eurozone sovereigns subjected to heightened market pressures. Instead, it focuses on what we consider to be a one-sided approach by emphasizing fiscal austerity without a strong and consistent program to raise the growth potential of the economies in the eurozone. While some member states have implemented measures on the national level to deregulate internal labor markets, and improve the flexibility of domestic services sectors, these reforms do not appear to us to be coordinated at the supra-national level; as evidence, we would note large and widening discrepancies in activity and unemployment levels among the 17 eurozone member states.
Regarding additional resources, the main enhancement we see has been to bring forward to mid-2012 the start date of the European Stability Mechanism (ESM), the successor vehicle to the European Financial Stability Fund (EFSF). This will marginally increase these official sources' lending capacity from currently €440bn to €500bn. As we noted previously, we expect eurozone policymakers will accord ESM de-facto preferred creditor status in the event of a eurozone sovereign default. We believe that the prospect of subordination to a large creditor, which would have a key role in any future debt rescheduling, would make a lasting contribution to the rise in long-term government bond yields of lower-rated eurozone sovereigns and may reduce their future market access.
We also believe that the agreement is predicated on only a partial recognition of the source of the crisis: that the current financial turmoil stems primarily from fiscal profligacy at the periphery of the eurozone. In our view, however, the financial problems facing the eurozone are as much a consequence of rising external imbalances and divergences in competitiveness between the EMU's core and the so-called "periphery." In our opinion, the eurozone periphery has only been able to bear its underperformance on competitiveness (manifest in sizeable external deficits) because of funding by the banking systems of the more competitive northern eurozone economies. According to our assessment, the political agreement reached at the summit did not contain significant new initiatives to address the near-term funding challenges that have engulfed the eurozone.
The summit focused primarily on a long-term plan to reverse fiscal imbalances. It proposed to enshrine into national legislation requirements for structurally balanced budgets. Certain institutional enhancements have been introduced to strengthen the enforceability of the fiscal rules compared to the Stability and Growth Pact, such as reverse qualified majority voting required to overturn sanctions proposed by the European Commission in case of violations of the broadly balanced budget rules. Notwithstanding this progress, we believe that the enforcement of these measures is far from certain, even if all member states eventually passed respective legislation by parliaments (and by referendum, where this is required). Our assessment is based on several factors, including:
The difficulty of forecasting reliably and precisely structural deficits, which we expect will likely be at the center of any decision on whether to impose sanctions; The ability of individual member states' elected governments to extricate themselves from the external control of the European Commission by withdrawing from the intergovernmental agreement, which will not be part of an EU-wide Treaty; and The possibility that the appropriateness of these fiscal rules may come under scrutiny when a recession may, in the eyes of policymakers, call for fiscal stimulus in order to stabilize demand, which could be precluded by the need to adhere to the requirement to balance budgets.
Details on the exact content and operational procedures of the rules are still to emerge and -- depending on the stringency of the rules -- the process of passing national legislation may run into opposition in some signatory states, which in turn could lower the confidence of investors and the credibility of the agreed policies.
More fundamentally, we believe that the proposed measures do not directly address the core underlying factors that have contributed to the market stress. It is our view that the currently experienced financial stress does not in the first instance result from fiscal mismanagement. This to us is supported by the examples of Spain and Ireland, which ran an average fiscal deficit of 0.4% of GDP and a surplus of 1.6% of GDP, respectively, during the period 1999-2007 (versus a deficit of 2.3% of GDP in the case of Germany), while reducing significantly their public debt ratio during that period. The policies and rules agreed at the summit would not have indicated that the boom-time developments in those countries contained the seeds of the current market turmoil.
While we see a lack of fiscal prudence as having been a major contributing factor to high public debt levels in some countries, such as Greece, we believe that the key underlying issue for the eurozone as a whole is one of a growing divergence in competitiveness between the core and the so-called "periphery." Exacerbated by the rapid expansion of European banks' balance sheets, this has led to large and growing external imbalances, evident in the size of financial sector claims of net capital-exporting banking systems on net importing countries. When the financial markets deteriorated and risk aversion increased, the financing needs of both the public and financial sectors in the "periphery" had to be covered to varying degrees by official funding, including European Central Bank (ECB) liquidity as well as intergovernmental, EFSF, and IMF loans.
Now is the perfect time for the US government to spend more, as interest rates are at a historic low. This opportunity will likely not present itself again. It has never been cheaper for the government to spend.
Fiscal policy (i.e. government spending) should be countercyclical, i.e. increase spending in a recession, and decrease spending in a boom. We are barely recovering from a recession, and with record low interest rates, government should increase spending right now.
Debt is a long term issue. There is no short term deleterious effect caused by increasing debt. In a boom is when government spending should be decreased.
If you want to know what happens when governments cut spending during recessions, look at Europe, that's exactly what they're doing. And it's not ending well.
I had to wipe my eyes from the beauty of this post, you've summed up alot of prominent bi-partisan economists in a single post.
On January 28 2012 13:30 Zealotdriver wrote: LOL at Newt Gingrich's moon base. LOL at Mitt Romney's tax returns. LOL at Ron Paul's racist newsletters. I'm waiting for the real republican candidate to come out of the woodwork midway through the campaign.
I would argue that those newsletters are actually racially insensitive at best.
The guy who wrote them and he use to work at Fox News:
But people close to Paul’s operations said he was deeply involved in the company that produced the newsletters, Ron Paul & Associates, and closely monitored its operations, signing off on articles and speaking to staff members virtually every day.
“It was his newsletter, and it was under his name, so he always got to see the final product. . . . He would proof it,” said Renae Hathway, a former secretary in Paul’s company and a supporter of the Texas congressman.
or there is this one:
“A person involved in Paul’s businesses, who spoke on condition of anonymity to avoid criticizing a former employer, said Paul and his associates decided in the late 1980s to try to increase sales by making the newsletters more provocative,” the paper reports. “They discussed adding controversial material, including racial statements, to help the business, the person said.”
My opinion:
Pretty much the theme is 'Ron Paul isn't racist, but understands that lots of people are, and is playing on those feelings to increase his newsletter's profit'. If you think about it, it makes sense concerning his political stances too. Racists like libertarian views, they are closest to their own. Sure Ron Paul might not be a racist (I don't think he is), but why not get the racist vote by offering things like his stance that he wouldn't have tried to prevent the Holocaust, or that he would repeal the Civil Rights Act.
So your stance is that Ron Paul isn't racist, but he wants to act like a racist to make a profit from a.... newsletter? Someone who made their occupation as a doctor and was elected to congress really needs that obscure newsletters profit so much that he's willing to espouse something that is against what he believes in, someone as principled as Ron Paul is?
Oh, and racists (of course we mean white racists here) choose to not support hard core conservative right wing candidates, and instead flock to.... libertarians? Because... libertarians believe that people should not be hired or discriminated against on the basis of race?
You've really got some odd ideas there, I must say.
On January 28 2012 17:28 liberal wrote: So your stance is that Ron Paul isn't racist, but he wants to act like a racist to make a profit from a.... newsletter? Someone who made their occupation as a doctor and was elected to congress really needs that obscure newsletters profit so much that he's willing to espouse something that is against what he believes in, someone as principled as Ron Paul is?
Oh, and racists (of course we mean white racists here) choose to not support hard core conservative right wing candidates, and instead flock to.... libertarians? Because... libertarians believe that people should not be hired or discriminated against on the basis of race?
You've really got some odd ideas there, I must say.
I don't see how capitalism is something that strays from Ron Paul's beliefs. Controversy sells, do you really think Fox News would be conservative leaning if most americans who watch 24/7 news channels were hard core liberals? Ron Paul's reported net worth is between $2-5 million. In 1993 alone the business 'Ron Paul & Associates' which was the business that produced the newsletters reported an income over one million.
You must not pay much attention to the news if you don't realize that racist groups and other groups based around discrimination overwhelmingly support Ron Paul, he has been endorsed by KKK leaders, and people who run white supremacy groups/websites. It's a movement that for the most part crosses its fingers and hopes you won't discriminate, or thinks it is socially unacceptable and as such people will not do so, forgetting that in many areas of the country this is not true.
Just read the posts in this thread from Ron Paul supporters, 'we should repeal the Civil Rights Act, it's not needed because racism isn't accepted anymore.'
Speaking as an outsider I must say Romney appears to be the sole Republican candidate who can compete with Obama. Frankly, it baffles me that the GOP has raised and maintained such a circus for so long without Romney coming out as the clear and reasonable candidate. I'm tempted to hope someone other than him comes out on top because then Obama's second term is as good as won.
On January 28 2012 14:47 Terranist wrote: moon base would be so cool. this is the kind of stuff that inspired us when we were young and encouraged us to chase our dreams but now as the years passed the governments support of the space program has stagnated to nothing.
I actually find the progress of privately funded space programs far more interesting than I ever did apollo. If space travel was made profitable, that would be truly amazing, and as a republican I think Gingrich should have the same position. The role of the government is not to fund cool science projects that make the people happy and no president should be elected on the basis of such a ridiculous promise.
Umm... sometimes the people are a little short-sighted. Do you really think without the government's involvement in space exploration private companies would have done anything? No. Businesses will only ever care about profit, not the advancement of our species. Thus it falls upon the government to do some things for us. If you believe government shouldn't be involved in things like that, ok. Just realize that advancement drops off significantly when businesses run everything.
Define short-sighted. Is it short-sighted becuase they overvalue income in the near future to much compared to income in the far away future? So if you don't think they do that, and actually are trying to maxisme their shareholder value, then they don't think short sighted. They are just making sound financial decisions, which they are supposed to do.
What you seem to be talking about, has nothing to do with being short-sighted (economically). What you actually seem to imply is that people in fact want to use their money on donating to Nasa (in a completely free market), but would choose not do, and then later on they regret that they didn't do it, because they don't what is best for them.
On January 28 2012 14:47 Terranist wrote: moon base would be so cool. this is the kind of stuff that inspired us when we were young and encouraged us to chase our dreams but now as the years passed the governments support of the space program has stagnated to nothing.
I actually find the progress of privately funded space programs far more interesting than I ever did apollo. If space travel was made profitable, that would be truly amazing, and as a republican I think Gingrich should have the same position. The role of the government is not to fund cool science projects that make the people happy and no president should be elected on the basis of such a ridiculous promise.
Umm... sometimes the people are a little short-sighted. Do you really think without the government's involvement in space exploration private companies would have done anything? No. Businesses will only ever care about profit, not the advancement of our species. Thus it falls upon the government to do some things for us. If you believe government shouldn't be involved in things like that, ok. Just realize that advancement drops off significantly when businesses run everything.
Mathematically speaking, I am pretty sure that short-term profits are often times more important/valuable than long-term investments, which is a big reason for this. Not that I am arguing, I totally agree with you. I'm just giving reasoning for why this is the case. Businesses will not advance societies. It takes a more unified, forward thinking type of thinking that is only concerned with progress to do things like reach the moon.
The private sector has its place, but in terms of the advancement of our society, its the sort of thing that the scientific community and/or the government is able to do.
Yes its obv. true that short-term profits are more valueable. They are for everybody, not just business's.
But lets assume that business's onyl care about profit-maximation in a free market, but that people still have the same values as in todays societys. Why wouldn't people voluntary donate if throught space-programs was a good idea, and was interesting?
And according to this logic: If they for some reason chose not do donate, it would be because they didn't think space-programs was that interesting. Maybe they would rather prioritize elminating poverty from Africa. But from what I can gather from this forum, a lot of people actually value space-programs pretty high.
EPT
