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Author Topic:   Decline And Fall Of The American Empire
Taq
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Posts: 9973
Joined: 03-06-2009
Member Rating: 5.7


(2)
Message 3 of 170 (818566)
08-30-2017 11:19 AM
Reply to: Message 1 by Phat
08-30-2017 10:55 AM


Phat writes:
This morning, after reading about the likely economic impact of the Houston tropical storm and watching our country make a stupid decision to continue to commit to outlandish spending, even as our debts inch ever higher, I read a couple of dated articles both with the same title.
Our ratio of public debt to GDP is in line with other 1st world countries.
List of countries by public debt - Wikipedia
The second article i read, with the same title as this thread, was published in The Guardian in 2011.
The UK seems to be doing pretty well right now.
As I head towards retirement, I wonder how tough it will get. I cant really count on anything except God and my fellow citizens. There seem to be no more promises. Comments?
I wouldn't worry too much. In fact, if other economies in other countries improves this can only help America since we would have new customers for exports. As China's economy improves their labor costs will also increase, bringing them to closer parity with the US. Just look at California. If it were a nation unto itself it would have the world's 5th largest economy.
The nations that really collapse are too dependent on a single export, such as the economic collapse in Venezuela due to falling oil prices. Given the diversity of the American economy, I think we can weather most storms.

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Taq
Member
Posts: 9973
Joined: 03-06-2009
Member Rating: 5.7


Message 7 of 170 (818573)
08-30-2017 3:13 PM
Reply to: Message 6 by Diomedes
08-30-2017 3:06 PM


Re: Decline and Fall... of what?
Diomedes writes:
Incidentally, even when empires 'fall', it doesn't necessarily mean they wink out of existence. The Roman empire fell. Yet Italy still exists. The Macedonian Empire under Alexander the Great fell. Yet Greece still exists. Britain, Spain, France, Turkey, Mongolian. All had empires. Yet all the core countries are still intact and for the most part, are still prosperous.
There is a bit of modern Western bias when it comes to empires "falling". The period after the sacking of Rome around 400 CE saw a major decline in what we consider to be important, such as grand infrastructure, art, literature, government, and so on. The period after the fall of Rome was called the Dark Ages, after all. It could be said that we judge a culture and a time period by what they build.

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Taq
Member
Posts: 9973
Joined: 03-06-2009
Member Rating: 5.7


Message 12 of 170 (818587)
08-30-2017 6:19 PM
Reply to: Message 10 by Phat
08-30-2017 4:48 PM


Re: Bye Bye Global Reserve Currency
Phat writes:
That is too early according to most analysts. They peg 2003--the year the gulf war started---as the final nail in the coffin. We wiped out trillions of dollars and continue to do so.
WW II cost 4 trillion in current dollars and what followed was a very prosperous era. The current conflicts are totaling about 1 trillion, so WW II cost 4 times as much and we prospered.
This is, to me, what the Fall really means. No secure retirement. No social programs for an aging population who no longer contributes to the tax base. A growing population getting older, mind you.
Due in part to immigration, the US is going to feel much less pain when the baby boomers hit retirement age compared to other countries. If memory serves, Japan has population demographics that are really upside down.
From what I have seen, Social Security will continue to be solvent in the future since no politician will allow it to go away.
The main issue, as I have tried to explain before, is that once the US Dollar is no longer the global reserve currency, we can no longer print money to pay our debts and prices on oil imports will rise exponentially.
Every other country in the world seems to be doing just fine.

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Taq
Member
Posts: 9973
Joined: 03-06-2009
Member Rating: 5.7


(1)
Message 20 of 170 (818633)
08-31-2017 12:31 PM
Reply to: Message 15 by Diomedes
08-31-2017 9:23 AM


Re: Bye Bye Global Reserve Currency
Diomedes writes:
As a Gen Xer, I've been told that when I am at the age of retirement, I will likely be getting 75-80% of what my expected benefits were supposed to be. This stems from the fact that social security is paid to the previous generation by the current generation. Being that population demographics will shift towards being older as the boomers retire, that will mean insufficient income from taxes to compensate for the larger number of retired people.
Being of the same generation, I get what you are saying. I am also saving money for retirement.
It is also worth noting that they can increase taxes at any point so that people can get more benefits. It's not as if the current rates are a physical law that can't be broken. One of the first things they could do is get rid of the rule where only the first 100k or so of your income is taxed for Social Security.
Edited by Taq, : No reason given.

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Taq
Member
Posts: 9973
Joined: 03-06-2009
Member Rating: 5.7


(1)
Message 21 of 170 (818634)
08-31-2017 12:36 PM
Reply to: Message 16 by jar
08-31-2017 9:36 AM


Re: Bye Bye Global Reserve Currency
jar writes:
So why not open the borders, encourage immigration and maintain a large enough workforce to cover any loss of people paying into the system.
Of course, that will also require that there is a job in the US that pays enough for the taxes to fund the system.
As with many things, moderation is key. You don't want to flood the job market with new people. This will only depress wages and put stresses on unemployment benefits. You need to match immigration with the growth rate of the economy.
Edited by Taq, : No reason given.

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Taq
Member
Posts: 9973
Joined: 03-06-2009
Member Rating: 5.7


Message 25 of 170 (818646)
08-31-2017 3:34 PM
Reply to: Message 24 by Diomedes
08-31-2017 2:20 PM


Re: Bye Bye Global Reserve Currency
Diomedes writes:
To be fair, while we are sounding somewhat 'doom and gloom', as others have alluded to, other countries are in far more dire straights than the USA. Germany and Japan have much larger shifts in age demographics over the next few decades. And that is nothing to say of China. They have been on the one child policy for decades and have only undone that recently. But that sort of mandate pretty much guarantees that they will have a huge burden of an aged and aging population relative to the younger population. Not to mention they are not exactly a sought after location for migration.
In many Asian cultures it is customary for parents to move in with their kids and grandkids as they get on in years, so at least they have that going for them. Western cultures may have to follow suit.

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Taq
Member
Posts: 9973
Joined: 03-06-2009
Member Rating: 5.7


Message 62 of 170 (819129)
09-06-2017 3:49 PM
Reply to: Message 60 by Phat
09-05-2017 2:46 PM


Re: Does All Money Originate From Labor?
Phat writes:
a major economic event is when a majority of the people are directly affected. Not just in having less disposable income but in having no income.
We are currently at 60% employment for people 16 and older. Adding another 10 percentage points to the currently unemployment numbers would probably be an indicator of a major economic downturn.
However, power is relative. History has shown us that when the US goes through a recession or massive depression, so does the majority of the 1st world. The Great Recession of 2008 didn't happen just in the US. It happened world wide.
So in relative terms, I think we would be just fine. We will still have all of the infrastructure we currently have. We will still have the diverse economy we currently have. We will still have a massive portion of the world's most productive farm lands. We will still have 300 million people and the means to put them to work.
I don't want to swing too far in the Polyanna direction, but I just don't see a dire future for the US.

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