[bootlegga]

$1:

Niall Ferguson: U.S. Empire in Decline, on Collision Course with China

The U.S. is an empire in decline, according to Niall Ferguson, Harvard professor and author of The Ascent of Money.

"People have predicted the end of America in the past and been wrong," Ferguson concedes. "But let's face it: If you're trying to borrow $9 trillion to save your financial system...and already half your public debt held by foreigners, it's not really the conduct of rising empires, is it?"

Given its massive deficits and overseas military adventures, America today is similar to the Spanish Empire in the 17th century and Britain's in the 20th, he says. "Excessive debt is usually a predictor of subsequent trouble."

Putting a finer point on it, Ferguson says America today is comparable to Britain circa 1900: a dominant empire underestimating the rise of a new power. In Britain's case back then it was Germany; in America's case today, it's China.

"When China's economy is equal in size to that of the U.S., which could come as early as 2027...it means China becomes not only a major economic competitor - it's that already, it then becomes a diplomatic competitor and a military competitor," the history professor declares.

The most obvious sign of this is China's major naval construction program, featuring next generation submarines and up to three aircraft carriers, Ferguson says. "There's no other way of interpreting this than as a challenge to the hegemony of the U.S. in the Asia-Pacific region."

As to analysts like Stratfor's George Friedman, who downplay China's naval ambitions, Ferguson notes British experts - including Winston Churchill - were similarly complacent about Germany at the dawn of the 20th century.

"I'm not predicting World War III but we have to recognize...China is becoming more assertive, a rival not a partner," he says, adding that China's navy doesn't have to be as large as America's to pose a problem. "They don't have to have an equally large navy, just big enough to pose a strategic threat [and] cause trouble" for the U.S. Navy.

http://finance.yahoo.com/tech-ticker/ar ... with-China

I'm surprised nobody posted this up during the debt ceiling fiasco at the beginning of this month...

[BartSimpson]

Anyone still want to call the Tea Party folks racist for wanting an austerity budget?

[xerxes]

No, but I'll still call them idiots and loud-mouth malcontents.

[BartSimpson]

xerxes xerxes:

No, but I'll still call them idiots and loud-mouth malcontents.

And the people who call them idiots and loud-mouthed malcontents for wanting the government to stop spending more than it takes in are...?

[bootlegga]

BartSimpson BartSimpson:

Anyone still want to call the Tea Party folks racist for wanting an austerity budget?

If they had been willing to accept across the board spending cuts, I would have agreed with them. However, in true partisan fashion, they wanted budget cuts to basically be limited to social programs.

That was where they lost credibility IMHO.

[andyt]

But that's how you make the empire strong - build up the military and create a survival of the fittest society. Also makes it easy for the military to retain troop levels without having to have a draft, so people like GWB don't have to hide out in the National Guard, or Cheney later telling people he was too busy to serve. What's the point of having an empire if the ruling elite have to face deprivation and danger?

[Macguyver]

Net Worth Distribution USA 2007
Top 5% represent 62% of Net Worth Distribution

Top 20% represent 85% of Net Worth Distribution

Financial Wealth Distribution USA 2007
Top 5% represent 72% of Financial Wealth

Top 20% represent 93% of Financial Wealth

Your GOP want to leave the people with the money with their money, and try to squeeze another percentage or two from the bottom 80%.

No wonder China is taking over.

http://sociology.ucsc.edu/whorulesamerica/power/wealth.html
WARNING: GRAPHIC CONTENT - IF YOU ARE A GOP SUPPORTER YOU MAY WANT TO PUT YOUR BLINDERS ON IN ADVANCE - THIS SITE CONTAINS ACTUAL FACTS WHICH MAY NOT BE SUITABLE OR COMPREHENDABLE TO THE RIGHT - MAY CAUSE INTENSE ANGER, DENIAL AND HOSTILITY.

[Macguyver]

http://sociology.ucsc.edu/whorulesamerica/power/wealth.html

$1:

I think it's important to emphasize one of the dangers of wealth concentration: irresponsibility about the wider economic consequences of their actions by those at the top. Wall Street created the investment products that produced gross economic imbalances and the 2008 credit crisis. It wasn't the hard-working 99.5%. Average people could only destroy themselves financially, not the economic system. There's plenty of blame to go around, but the collapse was primarily due to the failure of complex mortgage derivatives, CDS credit swaps, cheap Fed money, lax regulation, compromised ratings agencies, government involvement in the mortgage market, the end of the Glass-Steagall Act in 1999, and insufficient bank capital. Only Wall Street could put the economy at risk and it had an excellent reason to do so: profit. It made huge profits in the build-up to the credit crisis and huge profits when it sold itself as "too big to fail" and received massive government and Federal Reserve bailouts. Most of the serious economic damage the U.S. is struggling with today was done by the top 0.1% and they benefited greatly from it.

Not surprisingly, Wall Street and the top of corporate America are doing extremely well as of June 2011. For example, in Q1 of 2011, America's top corporations reported 31% profit growth and a 31% reduction in taxes, the latter due to profit outsourcing to low tax rate countries. Somewhere around 40% of the profits in the S&P 500 come from overseas and stay overseas, with about half of these 500 top corporations having their headquarters in tax havens. If the corporations don't repatriate their profits, they pay no U.S. taxes. The year 2010 was a record year for compensation on Wall Street, while corporate CEO compensation rose by over 30%, most Americans struggled. In 2010 a dozen major companies, including GE, Verizon, Boeing, Wells Fargo, and Fed Ex paid US tax rates between -0.7% and -9.2%. Production, employment, profits, and taxes have all been outsourced. Major U.S. corporations are currently lobbying to have another "tax-repatriation" window like that in 2004 where they can bring back corporate profits at a 5.25% tax rate versus the usual 35% US corporate tax rate. Ordinary working citizens with the lowest incomes are taxed at 10%.

I could go on and on, but the bottom line is this: A highly complex and largely discrete set of laws and exemptions from laws has been put in place by those in the uppermost reaches of the U.S. financial system. It allows them to protect and increase their wealth and significantly affect the U.S. political and legislative processes. They have real power and real wealth. Ordinary citizens in the bottom 99.9% are largely not aware of these systems, do not understand how they work, are unlikely to participate in them, and have little likelihood of entering the top 0.5%, much less the top 0.1%. Moreover, those at the very top have no incentive whatsoever for revealing or changing the rules. I am not optimistic.

Yet the Right would have you believe that it is the poor, the immigrants and the social system that is bankrupting America.

My message to the Right - it's too late to wake up. Those top .01% of the population with staggering amounts of worth, those sacred cows, they've already got their bags packed and will leave you holding the bag for $8 trillion.

[CommanderSock]

When Obama offered them 4 trillion in cuts and they rejected the deal for the sake of partisanship, they lost all credibility.

Tea Party are the America's most dangerous clowns.

Neil might be right. But he's also been wrong plenty of times.

[Macguyver]

I hope he is wrong and I hope the right wakes up and starts realizing that the government needs to work for all the people, not just the rich, then everyone is better off.

The problem is that it is true that if the other 95% of us are better off, that will usually mean that the top 5% are probably going to be a little worse off.

[DanSC]

To be fair, China's taking over precisely because the rich party members have laws keeping the peasant underclass in line.

[Macguyver]

DanSC DanSC:

To be fair, China's taking over precisely because the rich party members have laws keeping the peasant underclass in line.

Very true, and they can turn a billion people on a dime. I'm not saying it is good.

[bootlegga]

DanSC DanSC:

To be fair, China's taking over precisely because the rich party members have laws keeping the peasant underclass in line.

Not at all - the biggest reason for China's frenetic growth is to keep the masses happy.

The CCP remembers how it rode the peasant masses to victory in 1949 and doesn't want someone else to do the same. China has by various estimates between 100 and 300 million migrant workers, who move from one part of the country to another, looking for work. Some of them work in agriculture, others in construction, some in manufacturing and the CCP is worried that someday they might wonder why almost everyone living in coastal China has it so much better than them. So the government spends money like crazy trying to build infrastructure & housing (thereby creating jobs) in the western half of the country - which for the most part is as dirt-poor as most of Africa.


People in the West seem to think China is all about communism, but what really matters there is money, status and power. Generally, if you get one, the others fall into line. Give the average Chinese person a good stable job and the ability to buy nice consumer goods (you know like us in the West), and they'll never revolt. But if the economy tanks, expect lots of unrest and turmoil.

[DanSC]

Unless you're Uighur. Then you're just boned.

[BartSimpson]

Macguyver Macguyver:

http://sociology.ucsc.edu/whorulesamerica/power/wealth.html
WARNING: GRAPHIC CONTENT - IF YOU ARE A GOP SUPPORTER YOU MAY WANT TO PUT YOUR BLINDERS ON IN ADVANCE - THIS SITE CONTAINS ACTUAL FACTS WHICH MAY NOT BE SUITABLE OR COMPREHENDABLE TO THE RIGHT - MAY CAUSE INTENSE ANGER, DENIAL AND HOSTILITY.

It's from the University of Santa Cruz. People from Berkeley call Santa Cruz insane.

In any case, wealth is far less concentrated now than it was 100 years ago.

This time 100 years ago Andrew Carnegie possessed over 5% of the national wealth...not just GDP. And in one year, 1904, he made over $400 million dollars which was about one million times more than the average income in the country.

Bill Gates, for all the limp-d*cked names lefties throw at him not only isn't even worth 1/1000th of a percent of GDP in terms of income his net worth is around 1/25,000th of a percent of national wealth.

The other issue affecting the concentration of wealth is that most people under the age of 60 are spenders and not savers or investors.

I'm pleased to say that I've got seven figures in assets and that's due to hard work, saving, investing, and scrupulously paying off our principle debt, being our house.

Other than myself and my wife, I don't know anyone else my age (46) who's debt free.

It's not the fault of the 'rich' that most people these days have no fiscal restraint and are unable to delay their gratification. And stripping the 'rich' of their assets will do f*ck all to improve the situation of the poor.