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Who: Kimball Corson. Text and Photos not disclaimed or that are obviously not mine are copyright (c) Kimball Corson 2004-2013
Port: Lake Pleasant, AZ
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America the Ignorant and Dim-Witted
Kimball Corson
04/30/2012, Pago Pago, American Samoa

America the Ignorant and Dim-Witted

A majority of American believe mistakenly that we have budget deficits because we are spending too much money on federal programs that are not needed or wasteful. Deficits should be deduced by spending cuts on such programs and waste under this view.

At the same time, majorities oppose spending cuts to social security, medicare, national defense, homeland security, antipoverty programs, unemployment compensation, education, farm aid and even to the arts and sciences.

The only thing a majority agree should be cut is foreign aid which is thought to account for 25 percent of federal expenditures. In fact, it is less than one percent.

The key point is this: when Americans consider what the federal government actually does in the specific instances, they don't think it is wasting money or spending too much. Only in the abstract -- from conservative propaganda -- do they think it spends too much with runaway spending on welfare moms and lazy bums and other unidentified wasteful programs involving big dollars.

This is serious thoughtlessness on a matter of great significance.

We Are Buried in Conservative Misinformation and Foolishness
Kimball Corson
04/30/2012, Pago Pago, American Samoa

We Are Buried in Conservative Misinformation and Foolishness

The conservative view is Obama has hugely ballooned government, increased federal employment and generated many new and expensive programs to help the poor, all at great expense and with much waste. All of these points are false and pure propaganda.

In fact, the federal government has been getting smaller, not larger over the last 25 years. Except for Social Security and Medicare which are growing as the baby boomers retire, federal government spending as a percentage of GDP averaged 15 percent in the 1950's and, before the Great recession, in 2007, was just 11 percent of GDP.

Aside from SS and Medicare, the federal government has been shrinking. So has the government labor force: from .9 to 1.1 percent of the population from 1954 to 1991 to only .7 percent of the population in 2010.

In 2010, SS, Medicare and interest on the national debt came to over 1.3 trillion. Tax revenues came to 2.2 trillion with the Bush-Obama tax cuts. Balancing the budget that year would have required all other federal spending - defense, the courts, Medicaid, food stamps, everything - be cut by over 60 percent. SS and Medicare account for almost 3/5 of all federal spending.

There is no room for the proverbial waste and huge and growing government that conservatives claim. Conservatives attack and want to get rid of the National Endowment for the Arts and the Consumer Financial Protection Bureau as being wasteful, yet the budget of each is less than 1/100 of 1 percent of total federal spending. That is just silly noise.

Federal spending and the government, aside from SS and Medicare, has not really been growing overall at all. That is simply another of many conservative lies. The deceit is tiresome.

The Principle Function of the Federal Government Has Become Social Insurance
Kimball Corson
04/30/2012, Pago Pago, American Samoa

The Principle Function of the Federal Government Has Become Social Insurance

Social insurance - in regard to income and health care, via Social Security and Medicare and Medicaid - has become the principal function of our federal government. It is a paid for insurer of first and last resort. Over 3/5 of federal expenditures are targeted on this function of protecting the general welfare and the percentage is rising.

The vagaries of the market place no longer serve those functions well and the government is moving to take them over except for the wealthy. Market crashes wipe out retirement savings. Paid into private pensions default right and left. Health care insurance markets - riddled with unpoliced anticompetitive practices - squeeze out those insurance options. Anticompetitive and outrageous heath care costs go unchallenged except by Medicare and Medicaid. Congress protects these industries and outrages.

Government can pool larger risks and take even better advantage of the law of large numbers. Medicare is more efficient than private health care insurers by a long shot. It can also force changes in the health care markets and it plans to. It can fight back and does. No other entity has the muscle. Congress is bought off and of no help here. The states have dropped the ball on effective insurance regulation and antitrust enforcement.

Government has stepped up to the plate to protect the general welfare of the American people in all these circumstances. That is becoming its principal function under the Constitution and the General Welfare clause, as Alexander Hamilton envisioned it.

Conservatives don't like it, yet most Americans do and by far. They want these programs. Markets too often have left them flat on their faces because of wolves on Wall Street and runaway anticompetitive practices in these areas.

Trust in the private sector has evaporated in one scandal and misdeed after another. Insurance paid for with private insurers often evaporates when claims are denied. Playing games is the order of the day. Buy a Wall Street product and you get left holding the bag too much of the time.

It is time we all wake up and recognize these facts, and stop listening to and thinking within the framework of conservative propaganda. Understand what is really happening and why.

A Major Turning Point
Kimball Corson
04/27/2012, Pago Pago, American Samoa

A Major Turning Point

At the 2000 Republican National Convention, Bush, the Younger, said:

Today, our high [not!] taxes fund a surplus [the Clinton surplus]. Some say that growing federal surplus means Washington has more money to spend. But they've got it backward. The surplus is not the government's surplus; the surplus is the people money . . .No is the time to reform the tax code and share some of the surplus with the people who pay the bills."

Bush then went on a tax cutting binge, especially in regard to the rich. The net effect of the full Bush-era tax cuts have been the single biggest contributor to the deficit over the past decade, reducing revenues by about $1.8 trillion between 2002 and 2009. This ignores the wars with Iraq and in Afghanistan which Bush Jr. got us into and the Wall Street Crash and ensuing Great Recession he handed to Obama upon leaving office after eight years.

One the other hand:

Speaking at the 2000 Democratic National Convention, Al Gore said:

"We will balance the budget every year and dedicate the budget surplus first to saving Social Security," promising to put "both Social Security and Medicare in an ironclad lock-box where politicians can't touch them."

This is the real Bush vs. Gore, not the farcical mess the Supreme Court made of that case, and you don't need to be a Gore fan to see it either.

Conservatives Are Destroying Our Democracy
Kimball Corson
04/27/2012, Pago Pago, American Samoa

Conservatives Are Destroying Our Democracy

They are spoil sports. They can't stand not to have their way. When they lose, they block the majority by Filibuster and legislative guerilla tactics. Obama garnered the majority vote and won the electoral college, too, but he has been stymied by a minority of conservatives every step of the way, even when the Democrats had both the House and Senate. They want their way or else, the democratic process be damned.

Majority rule - the cornerstone of democracy - has been upended by contemporary conservatives. They have no regard for the constitutional process or government, nor do they want any part of or interpretation of the Constitution that doesn't suit them. They want all things their way or else, period. They even threaten each other with sticks (fund primary opponents) and carrots (money) to assure the hard core nasty leaders retain control and effective leadership.

There is a large cadre of Republicans out there who have been propagandized into believing our federal government is evil, it is destroying our freedoms, it engages in runaway spending on good for nothings and lazy bums, taxes are anathema and that the less government, the better. These Republicans are the hard core and they are not out to cooperate at all. They don't want government to succeed at anything. They oppose government. As Grove Norquist -- a very powerful figure in the Republican Party-- has said, paraphrasing, 'We want to chop government down to a size where we can drag it into the bathroom and drown the rest of it in the tub.'

The American majority - which has clearly not bought into this Republican drivel, but which has been much stymied - should send them a loud and repudiating message in November: Stop abuse of the Democratic process and sit on the side lines for a while to think about it.

As I have Been Saying . . .
Kimball Corson
04/27/2012, Pago Pago, American Samoa

As I Have Been Saying . . .

"Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history. . . . There is a tiny splinter group [refering to the John Birch Society], of course, that believes you can do these things . . . Their number is negligible and they are stupid. . . ."

Dwight D. Eisenhower 1954 (a 1950's Republican)

We now have the rise of huge numbers of right wing conservatives who reject Eisenhower's positions and align with the John Birch Society of old, all a la Koch & Friends and their propaganda machine on which they have spent more than $2 billion dollars since 1971 when the Powell Manifesto was published and misappropriated by them.

The Koch brothers' father was a founding member of the John Birch Society and his sons and their friends and their ambit of influence track his positions. You can see the pattern of their influence now near the core of the Republican party. The conservatives in Congress are more conservative now than they have been in over a 100 years, according to political scientists.

Much of conservative America has been demonstrably been brain washed. One can easily trace how from this outline. Follow the money and the bogus research and commentary it has purchased.

Now look at your own views. They are all just coincidences, right?

Do Buddhist believe in god?
Ven S. Dammika
04/27/2012, Pago Pago, American Samoa

Do Buddhist believe in god?

"No, we do not. There are several reasons for this. The Buddha, like modern sociologists and psychologists, believed that religious ideas and especially the god idea have their origin in fear. . . .

"Primitive man found himself in a dangerous and hostile world, the fear of wild animals, of not being able to find enough food, of injury or disease, and of natural phenomena like thunder, lightning and volcanoes was constantly with him. Finding no security, he created the idea of gods in order to give him comfort in good times, courage in times of danger and consolation when things went wrong. To this day, you will notice that people become more religious at times of crises, you will hear them say that the belief in a god or gods gives them the strength they need to deal with life. You will hear them explain that they believe in a particular god because they prayed in time of need and their prayer was answered. All this seems to support the Buddha's teaching that the god-idea is a response to fear and frustration. The Buddha taught us to try to understand our fears, to lessen our desires and to calmly and courageously accept the things we cannot change. He replaced fear, not with irrational belief but with rational understanding.

"The second reason the Buddha did not believe in a god is because there does not seem to be any evidence to support this idea. There are numerous religions, all claiming that they alone have god's words preserved in their holy book, that they alone understand god's nature, that their god exists and that the gods of other religions do not. Some claim that god is masculine, some that she is feminine and others that it is neuter. They are all satisfied that there is ample evidence to prove the existence of their god but they laugh in disbelief at the evidence other religions use to prove the existence of another god. It is not surprising that with so many different religions spending so many centuries trying to prove the existence of their gods that still no real, concrete, substantial or irrefutable evidence has been found. Buddhists suspend judgement until such evidence is forthcoming.

"The third reason the Buddha did not believe in a god is that the belief is not necessary. Some claim that the belief in a god is necessary in order to explain the origin on the universe. But this is not so. Science has very convincingly explained how the universe came into being without having to introduce the god-idea. Some claim that belief in god is necessary to have a happy, meaningful life. Again we can see that this is not so. There are millions of atheists and free-thinkers, not to mention many Buddhists, who live useful, happy and meaningful lives without belief in a god. Some claim that belief in god's power is necessary because humans, being weak, do not have the strength to help themselves. Once again, the evidence indicates the opposite. One often hears of people who have overcome great disabilities and handicaps, enormous odds and difficulties, through their own inner resources, through their own efforts and without belief in a god. Some claim that god is necessary in order to give man salvation. But this argument only holds good if you accept the theological concept of salvation and Buddhists do not accept such a concept. Based on his own experience, the Buddha saw that each human being had the capacity to purify the mind, develop infinite love and compassion and perfect understanding. He shifted attention from the heavens to the heart and encouraged us to find solutions to our problems through self-understanding."
_______

I do not suspend judgment. Here is why. On the point God is not disproved either, the way our system of knowledge works, once something is claimed to exist, the proponents of it have the burden of proof to establish its existence. Across the millennia and many social orders each claiming their god to exist and despite horrendous efforts by many over that time, no god has ever been proved to exist. The problem then becomes how is a negative or, more precisely here, the non-existence of any god to be proved? That is why the burden of proof lies with the claimant.

Acceptable proof that any of the many gods exist must stand muster under our theory of knowledge and none has never been presented. Proof that is demonstrable, verifiable and repeatable is the usual requirement for anything to exist, even the most elusive subatomic particles.

Inspired by a Long Beloved One Who Believes: a Response
Kimball Corson
04/27/2012, Pago Pago, American Samoa

Inspired by a Long Beloved One Who Believes: a Response

On religion: the core question in this context, within the etiology of our theory of knowledge, is what is true (that is, demonstrable or verifiable) and what is conscious delusion or our imaginings. Atheists, and now a majority of scientists, reject the idea of a personal God of the genre "he walks with me; he talks with me" or of the comforting sort, as being fantastical and delusional, with no support in reality.

Too, the notion of a God needed to create and run the universe is now repudiated as well. As Stephen Hawking has explained, the universe is infinitely cyclical. Timeless; without beginning or end. With what we now know, no god is needed to explain anything, not the Big Bang, the processes or what we observe. As Hawking puts it, "There is nothing for a God to do."

Scientists therefore now mostly reject the idea of a personal, comforting God as delusional, but, that does not preclude a spirituality that stands in awe of all creation, the operation of the self generating laws of the universe and of our own lives. No master mind is required, so none is revered. Us, our place, our life in the world, and the processes of all natural phenomena are enough to sustain a meaningful spirituality. The conception is almost Buddhist.

There is a huge difference between such spirituality and the conceptions of organized, systematized and socialized religions. Where spirituality prevails, it is often in spite of and not because of such religions.

Gods and religions are created by man -- some 2200 of them by our last count -- to provide us with comforting delusions as well as very real society within which to interact and find support for those delusions. That is what religion is about, along with a modicum of behavioral control.

It is indeed, "[n]ot a bad idea to be able to add or increase something - be it friends, skills, hobbies, beliefs, etc. - while the years pass, considering that aging is usually accompanied by losses anyway." But with what, I ask? I would urge with ever greater understanding of more and more in as many directions as possible. The core virtue of a good education is the self sustaining capacity to continuing learning in the same manner as we have been taught. To self teach, as it were. That is my view.

The so called atheistic nations (e.g., some of the Scandinavian countries) often have better and more developed religious freedoms, with fewer foolish controversies attending them, than the US and nothing there precludes any spirituality.

It is most natural, as my life nears its end, to contemplate my life, the changes I have sustained and those I have observed beyond myself, the larger world around me, the character and growth of our knowledge and the larger cosmos I see.

The more I know about all of that going in, the more there is to contemplate and the more meaningful is the spirituality that is the natural extension of that contemplative endeavor. It is as natural as rain and a great way to end life.

The simplifications and condensations of impending senility and dementia are simply to be understood as such and themselves observed. I would go out in in ever greater, but more enfeebled wonderment.

How Government Has Undermined Itself with the People
Kimball Corson
04/27/2012, Pago Pago, American Samoa

How Government Has Undermined Itself with the People

As Margie Ane reminds us, it was Oliver Wendell Homes who said, "Taxes are the price we pay for civilization." Yet what we see these days is not civilization from our taxes, but too much corruption in government instead. Our disapproval rate of Congress is lower than ever: 77 percent. Taxes now fuel corruption and the reaction of many to this is -- government should be atrophied, less taxes paid and we should starve the beast. These are the elements of the conservative mantra, because conservatives have little knowledge or sense of history.

If they understood history better, they would realize there were times when taxes bought us a higher level of civilization and that as social beings, civilization is what matters. But those days have been eclipsed by corrupt government and many want none of it. The reactive philosophy is social Darwinism, so-called "free markets" and each man for himself, without government taxes or interference.

The baby is to go out with the bathwater as George Washington's hatchet is to be taken to all things governmental, except, of course, for our military offenses to protect or expand our worldwide commercial interests, as part of that macro social Darwinism.

This is a sorry, but true state of affairs. Congress has sold us out and it needs to go. To a man and to a woman.The corruption needs to stop and campaign finance reform is our only hope to do that, but Congress likes its hand in everyone's purse and has no interest in reform. So we are stuck.

We should lay waste to Congress in November but we are not smart enough to do that.

A Further Critique of the Austrian/Libertarian Schools
Kimball Corson
04/27/2012, Pago Pago, American Samoa

A Further Critique of the Austrian/Libertarian Schools

In the Libertarian/Austrian world, price adjustments do all the work and markets clear and find equilibria within a reasonable time, especially if government just butts out and leaves "free markets" alone.

In the real world, prices often cannot get the job done. Why? Because of 1) price rigidities, 2) price frictions and 3) asymmetrical information between buyers and sellers. As to rigidities, long term financial contracts are written in fixed dollar terms. They don't change much over the term of the contract. Some requirements contracts have twenty year terms and few provisions for price adjustment. Too, wages are not negotiated daily and workers resist nominal wage reductions more strenuously than equivalent real wage reductions that occur by way of inflation. Prices do not adjust as quickly as the Libertarians and Austrians assume. (Indeed, if there is speculation, as in commodities, they need not even adjust in the proper direction for stable market clearance.) Clearing economic equilibria are elusive.

As to frictions, there is often a problem of finding the needed market information sought to form the proper judgments on how to proceed and then in gauging the reliability of that information. That problem too blocks price adjustments and market clearing equilibrium. Buyers and sellers can be stalled out or engage in hedging.

But, more importantly, reality is also assumed away by Libertarians and the Austrians who likewise ignore the fact that, even when unconstrained, price movements are often insufficient to clear markets, as pointed out by George Akerlof, A. Michael Spence and Joseph Stiglitz in work that garnered them the Nobel Prize. Why? Two points have already been raised: price rigidities and frictions, but there is a third reasons as well.

In many markets, both sides of an economic transaction have different sets of information or asymmetrical information on the same relevant facts. This happened, in a major way in the credit markets during the financial crisis of 2008. Asymmetry of information regarding each institution's financial situation was so pronounced that lending fell precipitously as trust dissipated.

These informational problems were only exacerbated as lending collapsed further. Eventually, no interest rate could induce lending and prices failed to clear the credit market. Restoring the functioning of the credit markets required mitigating those informational asymmetries, essentially by way of short-term government guarantees which mooted them. There's that horrible government again, creating market problems.

It is a mistake to think these informational problems are limited to credit markets or that they disappear over time, as memories of the problems recede. They may abate, but the markets remain unstable because of the structure of information dispersion and they still do not clear properly. They tend to oscillate around the informational asymmetries from being over-bought to being over-sold. This is true for any markets where buyers and sellers have different information that is relevant to their transactions or exchanges, and not just the credit markets.

Libertarians and Austrians are simply clueless on these established phenomena and live instead in an ideal world of perfect competition, perfect information and perfect price flexibility. Regrettably, that is not our world and so markets do not work as they think they do. They are badly in the dark.

An Old Friend Reports on Some Considered Advice
Kimball Corson
04/27/2012, Pago Pago, American Samoa

An Old Friend Reports on Some Considered Advice

Jim Flory writes, "I once met a young man who had broken his neck sky diving and was confined to a wheel chair for life. (He was speaking at the U of Minnesota to a human sexuality course, his topic was the plasticity of the brain in creating alternate erotic skin zones for people with nerve damage.)

"As someone who was engaged in mountaineering at that time, I asked him now that he had paid the price at a high risk sport, what was his advice to others.

"He paused to reflect on the question and then asked if I had ever driven across Nebraska. I said yes. He said there are some people who are willing to accept a life that is like driving across Nebraska. However, he said that he could never have settled for such a boring life and he would advise people, like himself, not to be reckless (he claimed hadn't been).

"Instead they should do a conscious, carefull, realistic calculatation of the risk you personally are willing to accept. I would add the cost to others (family, friends, etc.) who rely on you, as part of the calculation."

Fly Girl + Terrorizing Papa
Kimball Corson
04/27/2012, Pago Pago, American Samoa

Terrorizing Papa

My youngest daughter, Jody, has discovered a new way to terrorize her father. My hair is standing as straight up as hers. My idea of good sense leans more toward jumping into airplanes, not out of them. She has aways been a bit of a physical/athletic person though (was invited to Russia to join the corps of the Bolshoi), but this is too much. Any suggestions on what I might propose to her as an alternative activity (and not bungy jumping either)?

That is her new husband to the right, already attempting to kill her. And that is the sky diving instructor on top of her, to assure she is well flattened when she hits.

One of Many Theres + Eternal Timelessness
Kimball Corson
04/27/2012, Pago Pago, American Samoa

Eternal Timelessness

For thousands of years, this surf
Has plied its way upon this shore, and
I have been -- only 70 of those years,
And not any here as now, so
What can I know or have seen?

What storms and tranquilness --
What profound timelessness --
Where all simply is -- without
The measured eternity of some
Meaningless ever bigger number --

That cannot know this sea,
This sand and this surf,
Then, or now with me.

Is Money Destroyed When a Bank Loan Is Repaid?
Kimball Corson
04/27/2012, Pago Pago, American Samoa

Is Money Destroyed When a Bank Loan Is Repaid?

In a word, yes.

1) Fiat money is destroyed by burning but only under authority of the Treasury which has responsibility for the paper currency.

2) When a loan is made by a fractional reserve bank holding excess reserves of high powered money, a new demand deposit is created and the monies placed in the borrower's account.This is new money in the banking system. It is extinguished when the loan is paid back and those reserves are to that extent again freed up to create new money. This is primarily how M1, the total of currency + demand deposits, increases and decreases.

Those who argue otherwise ignore the fractional reserve aspect of the bank and the idea of excess reserves of high powered money. Only if high powered reserve monies themselves are directly used to make the loan is there an off-setting transaction with the Fed or central bank but that is rarely the case. Otherwise, based on the fractional reserve concept, banks are free to make new money up to the limit implied by their high powered reserves and the reserve requirement and have it destroyed when those loans are repaid.

Note that banks cannot create money by themselves or destroy it. It takes customer loans to do that. Banks can screen customers for credit worthiness and advertise their ability to make new loans, and they can call loans that are callable, but beyond that it is bank customers who increase and decrease M1 or loans outstanding.

If a loan is not repaid, the money is not destroyed as with repayment, but a receivable of the bank is lost and those funds have to be covered from the bank's capital, assuming the bank has no current profits. Similarly, if the value of the loan falls, the decrement also has to be covered from the bank's capital. The banks capital account is different and separate from its reserves (of high powered money) account(s).

If economic times are bad and customers therefore less credit worthy, fewer new loans are sought and made and the money supply growth stalls out on this score and sometimes can even contract. The latter is a great fear of policy makers because contraction of the money supply can lead to deflation if the volume of goods and services produced does not fall commensurately and the velocity of circulation of money remains the same.

Obama Catches On
Kimball Corson
04/27/2012, Pago Pago, American Samoa

Obama Catches On

Obama is doing better in a key regard. He just put the Buffet 30% minimum millionaire tax squarely on the table and the Republicans -- stupidly predictable protectors of the rich that they are -- shot it down.

This is how Obama should have been proceeding all along. Instead of presenting some half-assed, watered down proposal, which the Republicans would shoot down anyway, Obama should have always put on the table exactly what he wanted and explained in detail why. Republicans would then, as predictably as clocks, have voted it down.

THEN Obama can say at election time, I proposed X, Y and Z to squarely address problems A, B and C, but the Republicans -- whom you should vote against -- blocked each proposal, but put no alternative proposal of their own forward, except to propose cut taxes for the rich and to cut unemployment compensation and food stamps for those injured by the Wall Street Crash and Great Recession which Bush handed to me when I became president after he had been in office the eight years previously.

That is why we are where we are with the economy, health care, unemployment, the deficit, etc. Government inaction and the failure to address these problems is the Republicans' fault. They materially caused the problems and they have blocked any solutions to them. They are real spoil sports who have been determined to block me, but instead they have injured all Americans except the super rich who got the Bush tax cuts which increased the deficit they claim to care about.

This should be his central them. It is a killer approach.

 

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