Saturday, May 29, 2010

QotD: If Billy has two apples, and the government takes them both, how many apples can the government give Jimmy?

We are so boned:
According to a Fox News poll earlier this year, 65 per cent of Americans understand that the government gets its money from taxpayers, but 24 per cent think the government has “plenty of its own money without using taxpayer dollars.”

25 comments:

New Jovian Thunderbolt said...

~sigh~

kahr40 said...

...and without even a kiss.

Britt said...

So just under half of Obama's voters are actual retards.

Anonymous said...

I presume we're talking about the FEDGOV here.

Only an honest government spends dollar-for-dollar what it receives from each taxpayer, and only the truly naive buy into the notion that the only source of government revenue is the taxpayer. For every dollar that it takes in taxes, the FEDGOV can PRINT a second dollar -- in effect, the government's "own money" -- making that other 24% correct in a (sad, frightening, infuriating) way.

TJP said...

Were there actually apples, or was it defaulted bundled debt for financing urban apple farms, with farmers who have no documented source of income?

Anon: If I cut a one-ounce gold nugget in half, have I doubled its value?

Roberta X said...

Aaaaaaanhhh! Aaaaaaanhhh! Aaaaaaanhhh! My brain hertz!

Borepatch said...

Actually, there may be some truth in that. If you sold the National Parks, you might bring in a Trillion dollars. Hey, free health care for everybody!

alath said...

It's not just morons-on-the-street who believe this stuff. Here is an article on HuffPo (morons-on-the-web), quoting actual egg-headed university economics professors, saying basically that the government can create wealth by printing money:
http://www.huffingtonpost.com/lynn-parramore/the-deficit-nine-myths-we_b_553527.html

Also, click on the link to the right of that article about how we can create infinite amounts of energy with perpetual motion machines.

John said...

Only 24% believe in magic money? Somehow, I expected the stupidity to be higher.

TJP said...

Look, all those Marxists are now Keynesians! I guess this means they love Reagan now.

Either the aforementioned egg-headed professors have been misquoted, or they're hyphenated-economists, and therefore not really interested in the truth.

Printing money can eliminate bottlenecks due to money supply, but the government isn't actually producing anything except liabilities for the cost of manufacturing money. The government does indeed "create" wealth, but they're the only recipients, and it comes from a pile of it someone else created. So the "create" argument is looking at the gross and not the net.

Some folks are also quick to point out that gov't also produces things--which it does, and some useful--but they neglect to consider that maybe I don't want a case of Rights-B-Gon every congressional season, and if I had any say in the matter, I be canceling the order.

Anonymous said...

The Continental Congress (which possessed no power to tax residents of the several states) financed the War of Independence by issuing military scrip--the Continental dollar.

In the course of the war, Congress debauched that currency to 1/000th its initial value, hence the phrase, "not worth a Continental."

Given the inability of Congress to fund future debt obligations involving Social Security and Medicare, we may witness a similar fate for the greenback.

MALTHUS

Anonymous said...

So I'm gettin 3 apples right?

Anonymous said...

Comparing apples and oranges (or golds), but this time it holds up.

gov only has as many apples as they can coerce from Billy, but they can have and/or dispense as many dollars as they care to, and in the process they increase the "value" of that finite number of apples. By slicing up those two apples and declaring that each piece is worth what a whole once was they really are giving Jimmy more apple value, if not more apples than they took in from Billy.

Works with TJP's gold nugget too; you have one but if you cut it in half and say that each half is worth what the whole was and someone will give you double the greenbacks to buy them, then the value actually is doubled, as long as the perception is that it is. And that's pretty much what has actually happened in the gold market recently. Is an oz gold bar really worth $1200 or is it just that dollars are worth less? As long as the perception is that the value is in the gold, then it is so.

So does each slice of apple or each half of gold nugget have the value that the whole ones did? Well to some degree, to borrow Clinton's brilliant dodge, that all depends on what the definition of value is...price or cost might be a more apt description. But as long as the supply of currency is increased without relation to underlying worth, and as long as the perception is that the gold has more value than the dollars, then yeah.

Ultimately of course, there are still only those two apples and that one nugget of gold. And when the perception catches up to that reality, the whole house of cards comes tumbling down. That would seem imminent, but as evidenced in Tam's post, people are breathtakingly teh stoopid, and for now at least, perception is reality.

AT

Anonymous said...

In the Liberal point of view, since all U.S. money is printed by the Government, it is ALL the government's money.
ALL OF IT!
The government allows you to keep a little bit for your amusement, but it all REALLY belongs to the government and they can take it back any time and any way they please.
Gospel of Spread the Wealth 6:66.

Don Meaker said...

Actually the Government owns rather a lot of land. That could be sold or leased. Who wouldn't pay a Trillion for the rights to Yellowstone for 20 years or so? They also own courts, and could rent the priviledge or taking a contract matter to the courts.

Ed foster said...

Roberta: Hertz? At what frequency are the pains arriving? I was tempted to say something about cycling down to the Doctor's. Sorry.

TJP: I can't touch that. You win the gold medal for succinct comment. Bravo Sir!

Actually, the Federal Gov't does have plenty of it's own money. They only get 1.5 trillion from income tax. The rest comes from business taxes or tariffs (although they can't call them that).

Figure Barry Bumbles and the Pelosi Posse have hit us for something like 6 trillion dollars in the last year.

I'm including the 2+ trillion the Federal Reserve lent without our particular knowledge, and the increase in the national debt. Which is actually worse than a tax increase, as we have to pay an extra 100% interest on it every 6.5 or 7 years.

Was it only 10 years ago that the press was castigating George W. for letting the Federal budget pass one trillion dollars for the first time?

Assume that (and I think this is a conservative guesstimate) 20% of that budget was, by 1950 standards, completely wasted.

Posit also that we've had about 20% inflation since that time.

So a stripped to the bare bones George W. 2001 type budget would still be about one trillion dollars in today's money. Tack on another trillion for debt service and we could still eliminate the Federal income tax.

Think of it. The people who actually generate the nation's profits would have about 25% more peso to spend. Even if State taxes doubled, the increase would still be on the order of 20%, more than enough to fuel a staggering rebirth of our economy.

Sell off Fannie Mae, Freddie Mac, and all the FHA loans for whatever the market would be willing to pay, and kill all the taxes we're paying now to keep them and their bubble afloat and Timothy Geithner's buddies out of the poorhouse (or jail).

Eliminate all unfunded mandates forced on the states by the Federal government, and convert FEMA and Homeland security into departments of the National Guard Bureau, whose sole job is coordination between cooperating States.

Also chuck HEW and freeze all Federal monies to the states (they're doubling their own taxes from about 5% to about 10%, remember?) for anything except reasonable police and security functions.

The Post Office is more or less self supporting, so leave it alone. I'd say privatize it, but they put out feelers a few years ago and nobody wanted to buy.

As for the Civil Service, if we had the same ratio of .Gov employees today as we had in our aforementioned base year of 1950 (when nobody was starving), it would be 850,000 employees, rather than it's present two million plus.

Why is it that, whenever times are tough, the number of bureau-rats goes up, increasing the load on the fewer and fewer people paying taxes?

If they don't carry a gun, fight fires, or directly support those who do, how many of them do we actually need?

Pie in the sky? Naah, it'll happen. The question is before the crash or after it?

doubletrouble said...

*headdesk*
*headdesk*
*headdesk*

Rinse, repeat.

Divemedic said...

Since only 60% of FedGov expenditures are paid for by taxes, and the other 40% is printed and or borrowed from Chine and Japan, the 24% who think that are not wrong.

Everyone knows that taxes are not there to fund government. Taxes exist to modify behavior, punish the wealthy who made their money by cheating the poor, and redistribute that wealth to the poor.

Ritchie said...

Ed Foster: "The rest comes from business taxes or tariffs"
Ihaveaquestion, Ihaveaquestion, um, where do the businesses get the money to pay their taxes?
If the .gov decides to nick Wallymart for being evil, there will be a very efficient transfer nick directly to the middle and low income shoppers that the .gov claims to caaaare about and want to help soooo much. And most of them, almost all, would be so bereft of economic grounding that they would think the first part is a fine idea. There are wheels within wheels, and no level of government is excluded. (I think).

Anonymous said...

Billy gets no apples because he is a producer. The apples go to the stupid/lazy Johnny so he'll vote to keep the gov't in power.

Ed Foster said...

Ritchie, I posited a virtual elimination of federal goernment for anything except military and police functions.

None of it works unless we cut the Feds down to a vintage 1920's share of the pie.

Possible? Probably, but only after everything collapsed and that was all we could afford. A pity we couldn't do it earlier and possibly save most of it.

Anonymous said...

Borepatch, the trouble with selling or leasing the national parks is that IIRC, several American Indian Nations have first rights to them should that happen. The Blackfeet were forced out of what is now Glacier, the Havasupi claim a lot of the Grand Canyon, et cetera. And they have lawyers. Otherwise someone would probably try it, PBS series notwithstanding.
LittleRed1

staghounds said...

"For every dollar that it takes in taxes, the FEDGOV can PRINT a second dollar..."

We WISH it was only 1:1.

Dixie said...

I'm reminded of the radio interview in Detroit that ended with the woman saying "I don't know... his stash?!?!?"

The question was "Where does Obama get this money?"

It must be nice, going through life and not having to think... probably saves a lot of energy.

Joanna said...

Suddenly, marrying for money doesn't sound so bad ... although in this case you can substitute "remote homestead and mad wildernessey/farmy/hunty-type skillz" for money.

And he'd have to let me bring my cat.