Thursday, July 21, 2011

How To Live Beyond Your Means

How To Live Beyond Your Means

One of the things that most impresses most foreigners, when they arrive to America, is the high level of infrastructure. This can be seen in most Hollywood movies, pictures of America and so on. On the surface of things, this is, well, quite impressive, especially when compared to our own nation.

Most people, being what they are, are not interested in what's behind the veneer of success and wealth: debt and rot, only in the outer appearance of things. After all, this is no different then what happens when people idolize the glamorous without realizing how often enough, they are horrid human beings unfitting to share a sty with a pig.

So, this is similar to this ritz and glitz of the American infrastructure. On the outside one sees roads, bridges and all the makings of the richest nation on earth. On a closer look one starts to see the cracks and rot of that infrastructure starting to collapse.

Now one needs to look at how the US built so much more infrastructure, especially in the past 30 years, while actively outsourcing its factories and jobs, downgrading its population to little more then debt serfs.

American oblasts (states), as well as regions (counties) and city/village governments, live off of a hodge podge of taxes: primary in this is
1. property tax
2. sales tax
3. income tax (which is a small portion compared to the giant income tax taken by the federal government).

Add to this various taxes such as gasoline tax, fees and so on. The problem is two fold:
1. on their own, the taxes are not big enough to accommodate the purchase of so much infrastructure, so quickly, and
2. Americans lack the patients to save up and purchase with actual funds

Thus, the various entities involved found another Anglo invention: municipal bonds. These are in essence debt instructments that are sold on the bond markets to gain monies now against future taxes and of course, they must pay a profit, after inflation is factored, in order for people to give up real money now.

Now, on a one of issue, such may not be a bad idea. However, politicians being politicians, and democracy being what it is, once an scheme for easy money is hit upon, there is no self control in sight and never has been. All caution is thrown to the wind, and those in charge convince themselves that the inevitable disaster can be forestalled indefinitely. Such is the reality of today's America.

The statistics are appalling at best, every state, county and city with most of the villages included, are bankrupt. First, the system being based on future taxes, for the value plus a profit percent, must be built on the premise of increasing taxation. Secondly, like most things about Anglo finance, the value of the debt taken out, far exceeds the value of even the most optimistic projections of growth. However, when the inevitable decline hit in 2007/2008 and the American second depression began, property values, incomes and consumption all collapsed. In short order, the municipalities found themselves in a position that they could not longer service present debt and never mind future debt.

And in this we hit upon the greatest snag. Debt became to so large, that all taxes went to servicing it. To pay for the maintainence of existing infrastructure, never mind for the salaries and pensions of the workers, there was no funds short of yet more debt, which now has become unaccessible.

Each year, for the past several years, several thousand kilometers of local roads are turned into gravel, as asphalt is simply to expensive to repair. Firework displays have gotten smaller and smaller on America's liberation day, while police officers, even in the most violent hellhole in the US, are being laid off in record numbers, while in places like Fresno California, the police no longer respond to "minor" crimes below the level of murder, rape and beatings. Crime is of course skyrocketing.

At the same time, government infrastructure, from power plants to roads to buildings, is on clearance sales, in a desperate bid to raise cash for just one more year, maybe two. That once these assets are sold there will be no more, is a concern for another year. The post service is now reducing service from 6 days to 3 days per week, while schools are cutting the school year and the already abysmal levels of education. Hawaii is down to 4 day school weeks.

There is no hope in the future, without raising taxes even further, but this in itself then strangles the people. A dead end situation.


Renaissance Mom said...

Where are you getting the information that mail delivery has already been cut? I live in California and get mail delivery 6 days a week. There has been a proposal to cut it to 5 days for quite a few years, but it has to be voted on by Congress first, and legislation has just recently been introduced. The proposal has more to do with electronic technology than any recession. People simply do not mail as much anymore. It's easier and quicker to email and fax. And the 3 days a week delivery is being threatened within 15 to 20 years by the Postmaster. (Most likely so Congress will see 5 days as a compromise and vote for it!) Technology changes! And companies, like the USPS (who receives no tax monies, by the way) must change with it. Most days all I get are advertisements anyway. As for school days being cut, I say that the less time children spend in public schools being brainwashed, the better. Most parents are only mad because they will actually have to watch their own kids for three days a week instead of two. How horrible! (Sarcasm intended!) I'm not saying America is not going to hell in a handbasket. We are! But these two aren't reasons for this.

Pervych said...

Наиболее омерзительный ecть их презренный отказ обладать их полной моральной бедностью самостоятельно, очень хорошо иллюстрируемый ситуацией Россией это в прошлом столетии!!! БОГ ПРОКЛИНАЕТ ИХ ВСЕ!!!

Juniper in the Desert said...

I think you need to know the extent to which Russia is supporting all the stuff you complain about. Your leaders support the Democrats, Medvedev has said he hopes Obama gets in again, now this:

Talk about interfering in another states affairs!

Slave said...

What most all (99%) of Amerikans and the rest of the world are NOT aware of is the financial scam foisted upon the American sovereign citizen.

This double set of accounting books is called the CAFR. The Comprehensive Financial Report. It must be made public every year but the law does not require it to made publicly known. I learned this from Congressman Ron Paul. The states have BILLIONS invested in Wall$treet and yet lie and tax the public into poverty for new projects. The cities could take the annual dividends alone and pay for city services. The money is so huge that people have been 'disappeared' for making much public noise about it. Learn about it here at: