Posted on 05/29/2012 10:22:29 PM PDT by grey_whiskers
A spate of recent articles -- see for example here, here, and here -- have noted Detroit’s population implosion and financial woes, along with the proposed solution of shutting off street lights in underpopulated neighborhoods to save money. (Cue the obligatory “Will the last person to leave Detroit...” joke. The last article, in particular, notes that the solution is designed to drive people away from the poorest, most sparsely populated neighborhoods.) And why? Because, supposedly, there is not enough money to pay for the services. This is an important concept, and deserves further investigation, as it contains the answer to the riddle of how this happened, and, more importantly, how to reverse it.
A number of factors have come together to make Detroit what it is: the fall of the US auto industry (losing market share to Japanese rivals) and the shift of auto-assembly to non-union Southern states; the rise of single-parent families and the associated social pathologies; the drop-out rates in school; the prevalence of gangs and of drug violence; and the loss of stable, middle-class families and businesses which would otherwise have an interest in keeping up appearances, and provide the tax money to do so.
However, with the loss of good jobs, and the businesses that provide them, the money for basic necessities for individuals, and for government services, still has to come from somewhere. For a long time, this was done by socializing the tax burden: that is, instead of requiring each town, each municipality, to pay for its own services, money was taken from the larger bottomless pit well called the state; and after that, there was always the federal government. But, as is becoming clear, we are scraping the bottom of the barrel: there is no money.
“What can you mean?” the big spenders cry. “We still have checks in the checkbook.” Well, yes, you do, I reply; but there’s a new concept that I believe is a novelty to you. It’s called being overdrawn. The Federal Government is $15 TRILLION in debt. That is, for each of the three hundred fifty million men, women, and children in the country, their share of the national debt is about $42,000. That’s the average yearly salary (gross, not take-home) for an entire family. The debt is increasing; and of course, the $42,000 does NOT include interest. (In the words of one internet poster, “Thanks, Obama. You spent my lunch money, my allowance, my future salary, my inheritance, and my retirement. You asshole.”)
We have not yet reached the point of inflation -- last seen in the administration of the last Democrat President with a big toothy grin, Dhimmi Jimmy Carter. This happens when the government, in its infinite wisdom, decides to print money to pay off debt: this has every advantage except that of solving the problem. Money -- paper bills, or even coins -- are not magic; they are a shortcut, to allow people to exchange goods and services more conveniently: so that instead of my having to call Joe, Chuck, Bill, and Ted, and arrange a complex five-way-trade so that I get my milk, and Bill gets new tires, and Chuck gets his lawn cut, and...we just hand over $20 bills or credit cards. The government thinking is, well, to solve debt, we’ll just print more money. That way, we pay back the debt to whomever we owe it to, and if we just print some extra money for good measure, we can all be millionaires. But the reason this doesn’t work, is that money is only good for exchange as long as it doesn’t grow on trees. Once it does, it is no longer valuable, and people want more and more of it for less and less. Hello, inflation -- unless the government loses all sense of proportion, in which case, hello hyperinflation (wheelbarrows of money to buy a loaf of bread, as in the Weimar Republic, or prices doubling multiple times a day).
But, as I have said, we have not yet reached that point. The government in Detroit, and presumably, some other places (though not, as yet, California), has dimly realized that cuts in spending are necessary. And so the streetlights dim.
But they are missing the other half of the picture. Remember what I said about there not being enough money to support the infrastructure, the services, the payments? The problem is that there is not enough money being created. And one obvious solution, if Keynesian spending does not work, is to try to draw in more business through targeted tax breaks. (Costco is being lured to Detroit with just such promises. But these gambits do not always end well -- the property taken over by eminent domain in the infamous Kelo decision is now a vacant lot, and not generating *any* tax revenue.) However, there is one other way to consider the problem: and bear with me, because it is likely going to draw flak from both the left and the right.
Remember what I said about money being a medium of exchange? Well, the problem in these benighted urban areas is twofold: one, not enough money to pay for the services, and two, nobody willing to do the work on the infrastructure. What if we make a condition of receiving social transfer payments, a requirement that one actually performs some of the basic services, such as repairing street lights and other infrastructure? The right, of course, would object to this by comparing it to FDR’s Depression-era WPA, TVA, and other costly boondoggles. While I agree that there is a certain superficial resemblance, there are two important differences: 1) this spending is already “baked in” by liberals; 2) the infrastructure being maintained is not merely “busy work” such as digging holes only to fill them up again, but real working infrastructure that the government ordinarily provides, and which is “necessary” (in the words of Harvard's own Fauxcohontas, Elizabeth Warren) for the businessman to succeed.
But there are likely to be objections from the left, too. I can just hear the kvetching now: “Having to work for welfare? That’s slavery!” (No, I am not kidding: you can actually find people having the gall to claim that having to work for pay, is identical to being forced to work without pay.) See here :
The rhetoric surrounding the council’s welfare-reform repeal could not be more different: At the recent hearing, both council members and advocates called the expectation that welfare recipients should work “slavery.” The council’s actions could soon teach a new generation of New Yorkers to think of themselves as victims who owe only resentment to those who support them.
The answer to this is twofold; the first is that it is not the mere spending of money which generates the “multiplier effect” on GDP from the velocity of money; it is the fact that in order to earn money to spend, one must use one’s own time in creating a good, product, or service that other people actually want, in order to induce them to part with their own hard-earned money to pay for it. If other people just give you money as part of a government transfer program, the recipient spends, all right: but the goods and services which they would have produced along the way (which would have grown the economy) vanish into a fog of good intentions, never to be seen again.
And the second is a quote from Benjamin Franklin:
I am for doing good to the poor, but I differ in opinion of the means. I think the best way of doing good to the poor, is not making them easy in poverty, but leading or driving them out of it. In my youth I traveled much, and I observed in different countries, that the more public provisions were made for the poor, the less they provided for themselves, and of course became poorer. And, on the contrary, the less was done for them, the more they did for themselves, and became richer."
(In other words, there are virtuous cycles as well as viscious cycles: there is no career advancement to CEO of welfare -- except maybe by the perverse government incentive of multiple fatherless children. One contributes more to a stable society, long term. Guess which one has been pursued since the days of LBJ, and whose bitter fruits are now driving cities, states, and the country into bankruptcy?)
It's time to get America WORKING again, and let Obama taste the fruits of unemployment. (As a gesture of class solidarity, we could even institute a wealth tax to reduce him to a comfortable "bitter clinger" lifestyle of -- let's be generous -- $50,000 / year. We wouldn't want him to forget his roots in the 99%, would we? And don't worry about the Constitutional Prohibition on "bills of attainder" -- Constitutional scholars on the left have long assured us that it's just a "living, breathing" document anyway.)
Cheers!
Cue Francisco’s Money Speech.
Socialist education and policy dictate that they be taught a skill set useful to destroy civilization and producers. They would be useless to the socialist Utopian masters if they were able to take care of themselves, so no constructive skills are taught.
The problem in Detroit always appears with socialist planning, and the socialists have a standard method of dealing with it.
When an entitled class becomes no longer useful, and becomes costly, they simply kill them.
Every time.
This is collectivist thinking. Have the peasants work for their 2 rubles a day instead of just handing the rubles to them.
Human nature being what it is, people quickly figure out that whether you work hard or don’t work hard, you still get your 2 rubles a day. So, you get a whole culture of people who show up and sleep in the shade, pretend to work, or lean on their shovels and smoke all day long.
No reward, no incentive, no productivity.
I know, I’m wasting my breath trying to talk sense to Ivy League grads who have all the answers.
When an entitled class becomes no longer useful, and becomes costly, they simply kill them.
Every time.
Yup. That's what the OWS idiots, NBP idiots, and other leftist useless idiots don't understand: If they get their way, they will no longer be useful, and they will be exterminated by those they put in power. And if God forbid that comes to pass, I won't shed one tear...
I saw your complaint in action when I visited Ceylon. Along the south-west coast are a bunch of swanky hotels, for the tourists. The “main” road leading to them is a 1.5 lane disaster slowly disintegrating.
Lo, here is a road repair crew, five strong. One man digging the dirt out of the pothole, very slowly. Two more leaning on shovels, resting. A supervisor in a white suit, smoking and giving orders. And the fifth - holding a parasol over the supervisor to shelter him from the sun.
“This country” - I said to myself - “for all her natural riches, this country will be dirt poor forever.”
Socialist education and policy dictate that they be taught a skill set useful to destroy civilization and producers. They would be useless to the socialist Utopian masters if they were able to take care of themselves, so no constructive skills are taught.
The problem in Detroit always appears with socialist planning, and the socialists have a standard method of dealing with it.
When an entitled class becomes no longer useful, and becomes costly, they simply kill them.
Every time.
Pretty Blunt there... But unfortunately for them, pretty accurate historically.
Ah, yes, grasshopper.
However, the REPUBLICANS control the state government in Michigan now, and hence, the purse strings and disbursements.
Hence, they are not Socialists (we hope).
At the level of the city of Detroit, or of Boston, Memphis, St. Louis, Baltimore, I have no such illusions.
The problem in Detroit always appears with socialist planning, and the socialists have a standard method of dealing with it.
When an entitled class becomes no longer useful, and becomes costly, they simply kill them.
Very interesting thoughts in a very dangerous game: it brings to mind Jessie and Bluebell's puppies in Animal Farm, and the apparent seeds of race war being hinted at over the Zimmerman self defense case and others.
(Not to mention Obaamacare and the whole "cost justification" being used to eliminate preventative testing for many cancers, to cut back on transfer payments to the (more conservative, not brainwashed) elderly.)
Thoughts to ponder.
Human nature being what it is, people quickly figure out that whether you work hard or don’t work hard, you still get your 2 rubles a day. So, you get a whole culture of people who show up and sleep in the shade, pretend to work, or lean on their shovels and smoke all day long.
You mean like this?
"Five thousand years ago, Moses said, "Hitch up your camel. Pick up your shovel. Mount your ass. I will lead you to the promised land."
Five thousand years later, Franklin Roosevelt said, "Light up a Camel. Lay down your shovel. Sit on your ass. This is the promised land."
Or the Soviet Union's "we pretend to work and they pretend to pay us?" (Which is what it would become under hyperinflation or a devaluation of the dollar.)
No reward, no incentive, no productivity.
First we have to re-take the law schools and the courts, in order to eliminate the nutcase Marxist liberal judges from positions of power: and in order to do that we need to replace the Communist/homosexual axis in the media.
It's an uphill struggle.
After that is done, we take the welfare reform which the GOP forced down Clinton's throat to the next level, by requiring productive work as a condition of transfer payments, and stop incentivizing illegitimate children.
I know, I’m wasting my breath trying to talk sense to Ivy League grads who have all the answers.
I agree that Ivy League grads don't have all the answers, that's why I'm posting.
Obaama (and advisors), Bush '43', Clinton, Bush '41' were all Ivy grads, hence the hell-hole we're in. Reagan and Palin were NOT Ivy grads, which explains why they got stuff right.
The real objection is the literal Third-World status of the cities, caused by the deliberate destruction of the family and of work ethic, to provide a disenfranchised, bitter, easily-fooled bloc of voters. Racist? You bet, that's why the Democrats (party of Slavery, the Copperheads opposing the Civil War in the North, the KKK, Jim Crow, and opposition to Civil Rights) did it.
Look at it this way. In the Deep South -- in the midst of the Great Depression -- BEFORE voting and Civil Rights laws, when the very KKK staged a march in full hoods through DC as an expression of *political* power -- what was the rate of narcotics usage and black-on-black crime? Racism was worse than today, and standard of living infinitely lower. So poverty and racism cannot be the answer.
The answer? Christianity, intact families, and a work ethic.
Cheers!
The operative word is "now", and the skill and attitude, in the entitled classes, needed to rebuild the civilization supporting infrastructure, should have been taught in the public schools "then".
Additionally, the socialist public school indoctrination system runs just fine with RINOpublicans in charge. The proof you need for that is the current state of the US public school product, much of which has been produced under Republican control for the past 50 years.
Hence, they are not Socialists (we hope).
How about stupid, blind or statist? All the socialist advances of the last 40 years have been done right under the noses of Republicans (except Reagan).
Your plan, while a good idea, requires people that don't exist now, the ones that do are Communist political agitation fodder, they respond to nothing else, and have only the skill of the complaint.
Thank you so much for your wonderful essay-posts, dear grey_whiskers!
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