"We are broke"? as a reason to let rail funding dry up

[NE933]

Not so fast -- if we can't fund our America's Railroad, and if rail somethings get into endless threadbare vollies about the Northeast corridor vs Long Distance, why don't we simply -- go after the well tanned with bleached teeth and botox partied recreational New England mariners that have demanded, and got, Amtrak to agree to a 44 train per day limit on the Boston to NY route? Demand to open up their source of weath: their sugar daddies' wallets that have helped finance bad passenger rail policy, and use that to help pay for badly needed new bridges that will be higher above the water line and thus require less openings, along with the Superliner and Amfleet replacements? All of those who berate the NE Corridor I say this: you're on target but not completely. You're correct inthat the the NE states pay way less for their share of the Amtrak system, and we wonder why the likes of Nebraska and Kentucky and Indiana and Ohio are pissed with PRIAA of 2008's contribution formula, while the Northeastern states get selective constipation of purse and pocket. But it's not enough to let the debate end there. Senators and Reps. traverse between NY - DC, depend on the Corridor as a low cost public tit, to attend so called fund raisers at $1,000 per plate, doing so called work for the people, donned in glamour named tuxes and gowns while complaining "subsidies", and this gets brushed off like a mere insect bite. Want to get more money for both the NE Corridor and long distance overnight operations?!?? Start demanding our executive public servant leaders to honor their job duties by looking after more upkeep our America's railroad. Go after the Connecticut recreational boating associations that are allowed to shape commerce-by-rail policy with tactics of oppression by deciding on our behalf what the U.S. rail passenger needs and doesn't need, while not paying for the fix and replacing of the very old broken bridges they complain about.

Here in New York City we have knocked down a twenty eight year old supermarket in the Lower East Side of Manhattan, a grocery market for the neighborhood now left with few options. And a famed destination: a thirty year old South Street seaport pier of communal gatherings, shopping, and place for free entertainment, has the same fate as the doomed supermarket: both were deliberately demolished to make way for luxury condo towers. This, just less than half mile from Ground Zero. No money for passenger rail? A new Yankee stadium replaced and built in half the time for the new World Trade Center. No money for passenger rail? Amtrak represents an archaic, outdated way of travel that the public can't afford? Horses***. Those who say those words are holding all of the real money, and are misleading you, me, and the media. Knocking down useful buildings not even three decades old, there were nothing wrong with them, to erect someone else's castle in the sky, at our expense, is the REAL reason why we have no money, because the system is rigged so that their bank exec friends at these fundraisers can get them lots of money, money that needs to go to our infrasructure. We are betraying ourselves and our next generation who will look for sturdy policies, healthy bridges that will have to carry them across rivers, and find it has all but vanished, looted out by msguided and greedy leaders who's idea of writing a letter means sending a tweet while on the toilet, and who get college degrees from a tablet while munching on donuts in bed.

We are in so much trouble, we must seize the time now to get our leaders, those who still have brains, courage, and heart, to figure out a way through this mess.

 

[NW cannonball]

Yup. Right. Maybe you should have posted this on the other thread.

Hey, understand the main points - but --

I've posted a few incoherent general rants here -

But now I've got my act together - more or less --

So- New Yorker - consider the audience --

Just sayin.

 

[NE933]

It belongs on this thread, because the posting lays tangable logic trails to the never ending fight to save America's passenger railroad, that expose the problems that linger to haunt us, in a way that few have seen or dare to speak up about. There's a sort of joining the cause of passenger rail with the struggles endured in the battles for civil rights. The ability to take a train is not quite in the same league as forcing voting booths to allow all to vote, whether black or white, gay or straight, healthy or infirm. Or is it? They are not mutually exclusive. When I board a train I am chosing an option over others; when I ask the railroad to be there, and to receive the resources needed to keep it in place, I am now broadening my arguement with merits that I hope my audience will identify with. The fact is there are populations that use rail very often, even depending on it, or simply choose the option over others because traveling on a train brings relaxation, and benefits of health, environment, and connectivity (keeping aside some Amtrak failures involving poor maintenance, inattention to some routes, and severe lateness), populations that are under direct attack by poor decisions in Washington, along with their governors and the captains of business. Amtrak's captains, and others in the arena, must push for and enable it aim for a Zen, a hallowed balance, between running like a well audited business, built with reasonable fiscal controls and foresight, and moving the masses in places that does not necessarily pass the model of 'making a profit'. Passenger rail is to be regarded in the same high esteem as water, as in H20. It's a ***** to build and maintain reservoirs and move water in aqueducts, and costly as hell for the plumbing, but without it, we're dead.

I am a New Yorker: it's where I was birthed from my mother and father, and where I lived up to now. It doesn't make me better, or less, than a non New Yorker. I am ever mindful that where one is born is random (no one asks to be born in say, Brooklyn, NY), and that it is harmful to deride someone only on the basis of where they live or where they were born, because the truth is that continents and their nations are just sand and clay that are tall enough to rise out of the sea in one freakin' planet. I aspire to achieve benefits for passenger rail, especially but - not confined - to those who ride it often. Such arguements have parallels to other debates: the cause of fighting on behalf of the sick and downtroden, for example. But I would not want Amtrak to carry or even represent only the unhealthy: I want the able bodied ones who have worked with honesty, to enjoy their gains and be welcomed on board too. It just seems more and more that a disproportionate influence are being allowed to shape rail by choking it, enacting policies that adversly affect me, the nation, the towns and cities within, without hearing our due chance to voice out. I am not a Superman. However, how often when our hands feel locked, sometimes the power to change that lies within.

There's a deleted scene from a famous movie involving a yellow colored mason road. When the four principal characters reach the one who can give then the items they yearn for: a home, courage, a heart, and intelligence, he says that it isn't necessary to ask for these things, because: you had them all along.

P.S. does AU have an spellchek feature? Thanks.

 

[neroden]

Anyone who says "we are broke" needs to look at the $900,000,000,000 military budget, of which $9,000,000,000 seems to be literally stolen every year (the DoD fails its audits every year and this is the missing amount for 2013). For this budget, which is larger than the budgets of all the other militaries in the world combined, the US has managed to lose every war it's gotten into, and generate massive amounts of anti-US sentiment around the world. As a result, this money is actually spent making the US *less safe*.

Get rid of even a quarter of this wasteful military spending and it's enough to pay for everything we need here in the US, and more.

 

[henryj]

NE933 tell us what you really think.

 

[NE933]

I guess it's about liberty, and the freedom from oppression.

Liberty, and the Song for it (select verses), as penned by Guiseppe Verdi and sung by folk singer Nana Mouskouri:

"When you're singing, I'm singing with you, Liberty! When you cry, I cry with you in sorrow!

When we suffer, I'm praying for you Liberty, for your struggles will bring us a new tomorrow!

Days of sadness, darkness, and fear, must one day crumble -- for the force of your kindness and love make them tremble!"

"In the void of your absence we keep searching for you!"

"I believe you're the symbol of our humanity... I can see why, we die, to defend you .... please guide us to victory"

 

[Silver Star rider]

.......There's a deleted scene from a famous movie involving a yellow colored mason road. When the four principal characters reach the one who can give then the items they yearn for: a home, courage, a heart, and intelligence, he says that it isn't necessary to ask for these things, because: you had them all along.

Sounds like the Wizard of Oz you are trying to quote. I must have seen that missing scene because I remember it vividly. He goes on to tell them you had these things all along, what you are missing is something to prove you have these things, like the Scarecrow needing a parchment of paper to get the formula for the right triangle wrong.

As far as spell checking, the latest Internet Explorer on Windows 8.0 (at least) can indicate misspelled words when typing in on any website.

Bruce-SSR

 

[afigg]

P.S. does AU have an spellchek feature? Thanks.

Look for spell checker add-ons or apps for your browser (IE, Mozilla Firefox, Chrome, etc). You could also write your posts in a word processor with a spell checker and then cut and paste the post to the reply box.
As for main topic of your post, we (the US) are not broke and I get tired of people who parrot that line while not having even a rudimentary grasp of economics. But this thread is off into the political arena, so I will leave it at that.

 

[Alexandria Nick]

Anyone who says "we are broke" needs to look at the $900,000,000,000 military budget, of which $9,000,000,000 seems to be literally stolen every year (the DoD fails its audits every year and this is the missing amount for 2013). For this budget, which is larger than the budgets of all the other militaries in the world combined, the US has managed to lose every war it's gotten into, and generate massive amounts of anti-US sentiment around the world. As a result, this money is actually spent making the US *less safe*.

Get rid of even a quarter of this wasteful military spending and it's enough to pay for everything we need here in the US, and more.

You seem to be operating on the idea that if we spent less on the military, we'd spend more on X, which is has zero basis in reality. We spend whatever we want on whatever we want, without any real check against any baseline.

 

[oldtimer]

Anyone who says "we are broke" needs to look at the $900,000,000,000 military budget, of which $9,000,000,000 seems to be literally stolen every year (the DoD fails its audits every year and this is the missing amount for 2013). For this budget, which is larger than the budgets of all the other militaries in the world combined, the US has managed to lose every war it's gotten into, and generate massive amounts of anti-US sentiment around the world. As a result, this money is actually spent making the US *less safe*.

Get rid of even a quarter of this wasteful military spending and it's enough to pay for everything we need here in the US, and more.

Your Numbers may be understated for 2013 as an example:

On September 10, 2001, Donald Rumsfeld gave a speech at the Pentagon where he stated:

“According to some estimates, we cannot track $2.3 Trillion dollars in transactions.”

“The adversary is closer to home, it’s the Pentagon bureaucracy.”

“In fact, it could be said that it’s a matter of life and death.”

This statement was buried by the obvious tragedy of the next day perpetrated by a group that was mainly Saudi nationals. The alleged mastermind was a Saudi from a very wealthy family that the USA armed when he was fighting the Russians in Afghanistan. So we attacked a substitute Arab; as we have had a very close relationship with higher ups in our government and the Saud royal family.

How did we finance that war? I am old enough to remember paying a 10% surcharge on my income tax to pay for that war, but what did we do we lowered the top tax rate (which was 91% at one time). And, for that matter, where are the 12-18 BILLION dollars in shrink-wrapped hundreds that disappeared in Iraq?

So are we broke or is it that a group of highly lobbied politicians do not want to fund Amtrak as they and their "friends" won't make a fortune on Amtrak. Apparently they have forgotten about that piece of paper that states "...provide for the common good.

Sorry if my rant is of a political nature but it is a statement of facts that both major parties have used Amtrak as a target.

 

[neroden]

Anyone who says "we are broke" needs to look at the $900,000,000,000 military budget, of which $9,000,000,000 seems to be literally stolen every year (the DoD fails its audits every year and this is the missing amount for 2013). For this budget, which is larger than the budgets of all the other militaries in the world combined, the US has managed to lose every war it's gotten into, and generate massive amounts of anti-US sentiment around the world. As a result, this money is actually spent making the US *less safe*.

Get rid of even a quarter of this wasteful military spending and it's enough to pay for everything we need here in the US, and more.

You seem to be operating on the idea that if we spent less on the military, we'd spend more on X, which is has zero basis in reality. We spend whatever we want on whatever we want, without any real check against any baseline.

I agree, except for one thing. If we spend less on the military the politics might not be quite so insane -- because when we spend money which ends up in the hands of military contractors, or in the "black budget" of the NSA/CIA/etc., or simply stolen, it creates some really bad political dynamics as those thieves bribe and blackmail to get themselves more loot.

 

[NE933]

As for main topic of your post, we (the US) are not broke

Oh I know that. It's a game of which rug do we stash the loot. The world is awash in money, our stock market if I remember broke the record last week yet our stuff is still crumbling. But whatever. I like oldtimer's pointed question of what about providing for the common good?

 

[Silver Star rider]

As for main topic of your post, we (the US) are not broke

Oh I know that. It's a game of which rug do we stash the loot. The world is awash in money, our stock market if I remember broke the record last week yet our stuff is still crumbling. But whatever. I like oldtimer's pointed question of what about providing for the common good?

Here is the preamble to the Constitution, which you didn't properly quote....

We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.

Bruce-SSR

 

[FriskyFL]

It's impossible for the U.S. to "go broke". The Federal Reserve can simply increase the money supply by "turning on the printing presses" so to speak.

 

[crescent2]

I've told myself I'd keep quiet on matters of economics, but sometimes I lie.

I'm not an economist, but from what I remember from two semesters of college economics, this works only as long as the world agrees for it to work. Nothing tangible (only faith in the US government) backs those dollars, and if much of the debt is ever called in for some reason, flooding the market with that many printed dollars is definitely not good for the economy and can't be done indefinitely. In general, it can produce massive inflation among other things. That has happened in other countries. Yes, we're not other countries; we're big, brave, and strong. That may or may not mean invincible. I'm no expert there.

It is not phantom debt. Governments, brokerage houses, individuals, banks, etc. actually hold treasury notes, which are interest-bearing IOUs, plus there are other liabilities of record. Often they just buy more of the same at maturity, but they can be called in. How likely that might be to happen on a truly massive scale, I have no idea and don't claim to. Hopefully not very likely, and it seems to be more or less working so far. I'm doing OK at present anyway. I don't lose any sleep over it but OTOH it's not meaningless.

Just something to consider. You may have a different take but that's mine.

Edit: Many things have contributed to put us where we are, good or bad. It's not the result of any one party, faction, or group. Hopefully we won't go off in that direction here.

OK, I'm done.

 

[Ryan]

You're not wrong, but there is no sign of that happening.

It would also be foolish for someone to call in so much of debt that it would crash the economy. It's kind of self regulating like that.

 

[crescent2]

Good point. Talk about shooting oneself in the foot! If we ever really go down, the world's a-hurtin' too.

 

[WoodyinNYC]

I've told myself I'd keep quiet on matters of economics, but sometimes I lie.

I'm not an economist, but . . . if much of the debt is ever called in for some reason, flooding the market with that many printed dollars is definitely not good for the economy and can't be done indefinitely. In general, it can produce massive inflation among other things.

It is not phantom debt. Governments, brokerage houses, individuals, banks, etc. actually hold treasury notes . . .

[SIZE=11.666666030883789px]Government debt is backed by the power to tax. If banks, super rich individuals, brokerage houses, mutual funds, hedge funds, etc cash in the debt, Congress can pass laws to tax that money. "Ouch, no, you can't do that." [/SIZE]

[SIZE=11.666666030883789px]Yes, you can raise taxes on the rich. We have forgotten how to do it, but it can be done. So think of the government debt as being backed by the inherited assets of the Koch brothers, the Walton family, and others smart enuff to be born with rich daddies, and you may relax a bit.[/SIZE]

[SIZE=11.666666030883789px]And yeah, both parties spew economic nonsense. I heard Obama talk about how families have to tighten their belts and cut their budgets and so does the U.S. government. NONSENSE. [/SIZE]

[SIZE=11.666666030883789px]The government has the same powers it had under the [/SIZE][SIZE=11.666666030883789px]pharaohs: Raise taxes, print money, raise taxes, issue debt, raise taxes, draft your firstborn off to die in a foreign war, raise taxes -- nothing less than before.[/SIZE]

[SIZE=11.666666030883789px]Now, the government can choose to spend a little more or a little less. During times of widespread job losses, high reported unemployment, higher unreported unemployment from people taking "disability" or otherwise retiring while still able to work, etc, -- in hard times the government can spend a little more when everybody else is spending less. Such a Keynesian policy can restart growth, while reducing the pain for many millions of common people.[/SIZE]

[SIZE=11.666666030883789px]This country is in no way broke. That is a lie endlessly repeated on behalf of the rich who do not want taxes raised to pay for programs that benefit you and me but not especially them. The President and Congress have chosen to spend less than needed to get the economy back on a path of healthy growth. But that is a choice, not an inevitability.[/SIZE]

 

[jis]

In general it is not in the best interest of the debt interest holders to call them in. That only works towards destroying the "value" that they hold. So unless Congress is stupid enough to pull ill conceived stunts, it is highly unlikely that anyone will call any of this stuff anytime soon, provided US manages to keep its total debt within a manageable proportion of the GDP. As for what that proportion is, it is something that is mutually agreed upon by the market for debt instruments.

So yes, the entire thing is choice, and not reality inevitability.

 

[Green Maned Lion]

Economics is an extremely complicated subject, and it isn't taught in college Economics anywhere near a level for useful application. I think this is mostly because your average college graduate knowing the economic realities would be detrimental to the running of our system as it stands. Also because I don't think 90% of college students have a mind sufficiently gifted with systems comprehension that they could actually grasp the concept of how the world economy works. But here's a small crash course in some of what is not covered:

Inflation is much more beneficial to the consumer (or to be more specific, people who are mainly holders of unsecured debt, leveraged assets, and non-monetary assets) than it is to businesses and banks (or to be more specific, people who hold title to any kind of loans and/or large amounts of cash & cash equivalents). The average American holds a lot of non-liquid assets (homes, cars, jewelry, value retaining electronics and stocks) than they do relatively liquid assets (cash, cash equivalents, treasury bonds, etc.). In a high inflationary environment the relative value of their capital assets will generally keep up with inflation. E.G. if you have a $100,000 house with a $50,000 mortgage, or a 1/2 leverage, and the value of the dollar decreases by half, than you will likely have... lets say a $150,000 house (its bad economic times, so the house won't keep up 1:1), and you'd still have a $50,000 loan, or a 1/3 leverage. You have, effectively, increased your asset position by $25,000 in the original money.

But to the bank, well, they gave you $100,000 for the house. You paid them $50,000 in down payments and mortgage payments. You owe them another $50,000, but that $50,000 is now worth $25,000. So they gave you $100,000 in principle, and they are getting back $75,000 in principle, or they have lost the $25,000 you gained.

Crescent2 said we can't do that. She's wrong- as a teacher she should know there is a difference between can't and shouldn't. Our outstanding debt is unsecured. That means that we don't owe China the equivalent of $14 trillion in gold bars. We owe then $14 trillion. Period. It doesn't matter if our economy crashes and burns and you can't buy an ice cream cone for $14 trillion. We still owe them $14 trillion. And we can give them the ice cream cone price, and be rid of our debt to them legally. Whether they like it or not.

The rub comes from the fact that they won't like it. We will totally destroy our credit rating if we simply print $14 trillion in 14,000 million-dollar bills and dispatch it in a truck to the Chinese embassy. We have eliminated our debt, yes. We have also convinced our main financial backer to stop financially backing us, and had a detrimental effect on the confidence of any potential replacement.

Thats detrimental effect number one. The second detrimental effect is doing that has just decimated our economy. We currently have $1.28 trillion in currency in circulation. By increasing that amount suddenly to $15.28 trillion, we have, in all likelihood, reduced the value of that currency by at least half. Probably more. That would totally screw up our businesses. It would especially throw banks into total chaos.

But the flip side of the coin is that China is not going to recall its debt for the same reason. Yes, they can demand recall of all the money they owe us, instantly. And our response, especially since we would be so pissed we'd be blind from the blood bursting from our eye vessels, would be to print 14,000 million dollar bills, put them in a truck, and send them to the Chinese embassy. Which, as I said, would reduce the value of that currency by at least half. So they would lose at least $7 trillion dollars minimum, not to mention the useful $364,000,000,000 in interest it generates them yearly. And maybe even start a world war. Trust me, the Chinese aren't stupid- and certainly not that stupid.

The only reason I'd ever call in debts owed to me rapidly (call in or sell my Accounts Recievable, for instance) would be if I was so desperate for money, I couldn't do anything else. Because I would lose the benefits of the clients I called in. All of this is a complicated mess. It is a complicated mess that many politicians and practically all citizens can't make head or tail of, because they weren't taught it.

When I do business with people, I use credit. I always, always, ALWAYS, use credit with my suppliers. Why? Because I owe them, and they owe me. If they send me a shipment that is heavily short, or distressed, or the wrong item, I have that amount that I still owe them to use to lever them into doing something to correct it. I never pay for shipments until I check them in, check them out, and confirm I got what I ordered, in good condition. It keeps both of us in debt and leverage to the other. We both have a stake in the game. China would no more like us to suddenly pay off our debt than we would want them to ask us to.

The world is so much more complex now. No more can Monroe send his gunboats to Barbary to explain to them why we aren't going to pay their bribes in the form of perforating their cities with our cannonballs. We need Chinas cheap workforce. China needs our interest payments to fund her government. We need the money China is willing to loan us to fund our government. We BOTH need the military stability that comes from China and Russia and the United States and the European Union having such close and dependent economic ties that we can't afford to sever them by engaging in military conflict.

We aren't out of money. We can afford to build whatever we feel like. We choose to waste that money building a military three times bigger than it needs to be to protect us from all our enemies, foreign and domestic. There is a huge economy built up around that choice that we would destroy if we rearranged our priorities. If we decided that we were going to have the worlds best infrastructure instead of the worlds greatest military, and shifted, say, 600,000,000,000 a year to that goal (I'm not picking modes- all of our modes are degrading to crap) we could build that just as easily, but it would take a decade to recover from the economic shock of transferring our skill sets and graft mechanisms from building weapons to building infrastructure.

If you think you have a simple solution to our governments and nations problems, you are simply wrong. I don't care what it is, or what it does. Its wrong. Because we don't have a single big problem. We have 320,000,000 of the things.

 

[Big Iron]

Economics is an extremely complicated subject, and it isn't taught in college Economics anywhere near a level for useful application. I think this is mostly because your average college graduate knowing the economic realities would be detrimental to the running of our system as it stands. Also because I don't think 90% of college students have a mind sufficiently gifted with systems comprehension that they could actually grasp the concept of how the world economy works. But here's a small crash course in some of what is not covered:

Inflation is much more beneficial to the consumer (or to be more specific, people who are mainly holders of unsecured debt, leveraged assets, and non-monetary assets) than it is to businesses and banks (or to be more specific, people who hold title to any kind of loans and/or large amounts of cash & cash equivalents). The average American holds a lot of non-liquid assets (homes, cars, jewelry, value retaining electronics and stocks) than they do relatively liquid assets (cash, cash equivalents, treasury bonds, etc.). In a high inflationary environment the relative value of their capital assets will generally keep up with inflation. E.G. if you have a $100,000 house with a $50,000 mortgage, or a 1/2 leverage, and the value of the dollar decreases by half, than you will likely have... lets say a $150,000 house (its bad economic times, so the house won't keep up 1:1), and you'd still have a $50,000 loan, or a 1/3 leverage. You have, effectively, increased your asset position by $25,000 in the original money.

But to the bank, well, they gave you $100,000 for the house. You paid them $50,000 in down payments and mortgage payments. You owe them another $50,000, but that $50,000 is now worth $25,000. So they gave you $100,000 in principle, and they are getting back $75,000 in principle, or they have lost the $25,000 you gained.

Crescent2 said we can't do that. She's wrong- as a teacher she should know there is a difference between can't and shouldn't. Our outstanding debt is unsecured. That means that we don't owe China the equivalent of $14 trillion in gold bars. We owe then $14 trillion. Period. It doesn't matter if our economy crashes and burns and you can't buy an ice cream cone for $14 trillion. We still owe them $14 trillion. And we can give them the ice cream cone price, and be rid of our debt to them legally. Whether they like it or not.

The rub comes from the fact that they won't like it. We will totally destroy our credit rating if we simply print $14 trillion in 14,000 million-dollar bills and dispatch it in a truck to the Chinese embassy. We have eliminated our debt, yes. We have also convinced our main financial backer to stop financially backing us, and had a detrimental effect on the confidence of any potential replacement.

Thats detrimental effect number one. The second detrimental effect is doing that has just decimated our economy. We currently have $1.28 trillion in currency in circulation. By increasing that amount suddenly to $15.28 trillion, we have, in all likelihood, reduced the value of that currency by at least half. Probably more. That would totally screw up our businesses. It would especially throw banks into total chaos.

But the flip side of the coin is that China is not going to recall its debt for the same reason. Yes, they can demand recall of all the money they owe us, instantly. And our response, especially since we would be so pissed we'd be blind from the blood bursting from our eye vessels, would be to print 14,000 million dollar bills, put them in a truck, and send them to the Chinese embassy. Which, as I said, would reduce the value of that currency by at least half. So they would lose at least $7 trillion dollars minimum, not to mention the useful $364,000,000,000 in interest it generates them yearly. And maybe even start a world war. Trust me, the Chinese aren't stupid- and certainly not that stupid.

The only reason I'd ever call in debts owed to me rapidly (call in or sell my Accounts Recievable, for instance) would be if I was so desperate for money, I couldn't do anything else. Because I would lose the benefits of the clients I called in. All of this is a complicated mess. It is a complicated mess that many politicians and practically all citizens can't make head or tail of, because they weren't taught it.

When I do business with people, I use credit. I always, always, ALWAYS, use credit with my suppliers. Why? Because I owe them, and they owe me. If they send me a shipment that is heavily short, or distressed, or the wrong item, I have that amount that I still owe them to use to lever them into doing something to correct it. I never pay for shipments until I check them in, check them out, and confirm I got what I ordered, in good condition. It keeps both of us in debt and leverage to the other. We both have a stake in the game. China would no more like us to suddenly pay off our debt than we would want them to ask us to.

The world is so much more complex now. No more can Monroe send his gunboats to Barbary to explain to them why we aren't going to pay their bribes in the form of perforating their cities with our cannonballs. We need Chinas cheap workforce. China needs our interest payments to fund her government. We need the money China is willing to loan us to fund our government. We BOTH need the military stability that comes from China and Russia and the United States and the European Union having such close and dependent economic ties that we can't afford to sever them by engaging in military conflict.

We aren't out of money. We can afford to build whatever we feel like. We choose to waste that money building a military three times bigger than it needs to be to protect us from all our enemies, foreign and domestic. There is a huge economy built up around that choice that we would destroy if we rearranged our priorities. If we decided that we were going to have the worlds best infrastructure instead of the worlds greatest military, and shifted, say, 600,000,000,000 a year to that goal (I'm not picking modes- all of our modes are degrading to crap) we could build that just as easily, but it would take a decade to recover from the economic shock of transferring our skill sets and graft mechanisms from building weapons to building infrastructure.

If you think you have a simple solution to our governments and nations problems, you are simply wrong. I don't care what it is, or what it does. Its wrong. Because we don't have a single big problem. We have 320,000,000 of the things.

The world of academia needs adjunct professors like you.

 

[Phil S]

Anyone who wants to understand economics as best possible given the state of the "science" as of 2013, read Thomas Piketty, if you can find a copy - it's been selling out right and left. Oops, I said the bad words. So having started down that slippery path, yes, both parties have contributed to the US train problem, but one has contributed a lot more than the other.