Slick Willie's Surpluses - the Real Story

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I would have to go back to Andrew Jackson, and perhaps earlier.

there's a recently leaked/declassified document on the threat of what would happen if we paid down the federal debt. IIIRC it was written in 1988 or something, by an individual who is still actively involved in the matter.

No. We have had this discussion. The supposed "streamlining" of financial services during the 1990s destroyed several layers of protection against uncontrolled speculation. I have pointed to the Gramm-Leach-Bliley Act as an example of this, but I am afraid that it's too arcane for most people to grasp its significance. What it means is that the "bubble" was created partly by a sudden relaxation in lending standards. There was actual substance to the economic gains in the 1990s; however it was inflated drastically by a spree of irresponsible lending.

Part of the problem was that suddenly people who had never had the means to make investments before had access to companies like E-Trade and other tools. However, the same thing happened here that you would get in a disorganized direct democracy: because these new investors were hopelessly clueless, it was easy for dishonest or incompetent entrepreneurs to rope in big money.

Now, you would think that people would learn their lessons after this, but it doesn't work that way. You have people emerging every day, from various backgrounds, who are finding out suddenly that they have disposable income for the first time, and they start to see the "dark at the end of the tunnel." They realize that it's getting late in life, and they need to save for retirement. They need to figure out how to leave some kind of legacy for their kids. The thing is, they were not trained to understand certain aspects of economics, and it would be grossly inefficient to try to teach everybody how to understand so many complex economic concepts. It defeats the ancient concept of "division of labor." Just like "direct democracy," it's stupid and impractical to ever expect it to work.

On the other hand, the growth of information technology during the 1990s was real, and the revolution was created partly by the cooperation of government and industry in creating what we know as the "World Wide Web." It was one of the last great collaborations between business and government. Part of what made it possible was the establishment of universal standards and protocols. A naive thinker might argue that this strips away creativity, but I remember what my English teacher used to tell me when she was trying to get me to understand why it's important to know the standard ways to build an essay: the seemingly stilted and rigid under-structure creates a platform for the imagination to really take off. This is what a regulatory structure does if it is put together properly.

Therefore, it is not justifiable to blame Bill Clinton for the "Dot-Com Bubble." This kind of claim is useful for dishonest politicians who are trying to discredit and undermine their political rivals, but there is no real basis for it. If you like being fed lies, though, chow down. I'll stick to coffee.

For anyone out there still defending libertarianism, remember this: you will have government. There will be people and institutions that have power over you and the ability to tell you what to do. The difference with a democratically elected government is that someone asks you your opinion once in a while and takes it into equal consideration. You don't have this leverage with the person who determines your "credit score." You can take away our democracy, but you WILL have government.

Reagan, that so-called conservative ended up delivering $1.75 cents worth of government for each $1.00 collected in taxes. The theory is while we took a loss on each transaction, somehow we could make up on on volume. Bush I called it voodoo economics and he was right on.

ruveyn

Okay... maybe it's just too early in the morning, but this does not compute.

Sure, it's too simple to blame "Bill Clinton", but deregulation continued under his administration allowed naive investors and unscrupulous financial types to wildly throw money at any company with .com at the end of its name... and that did cause the stock price bubble.

It's called the "Gingrich Revolution." However, the Gingrich Revolution was only part of it. Remember, Robert Rubin was Secretary of the Treasury at the time, and deregulation of derivatives came out of his playbook. Rubin was also a supporter of repealing Glass-Steagall. It was just having Congress packed with Republicans that made it possible.

You know, the second-longest filibuster in the history of the Senate was over Glass-Steagall, when it originally became law. The longest filibuster was Strom Thurmond over Civil Rights. Appropriate, don't you think? Glass-Steagall was probably one of the strongest sets of laws in history put into place to protect the rights of borrowers. You don't have those rights anymore. You are living in a society now where you have a little number called your "credit score" indicating your individual worth as a human being, and that number is determined entirely by how efficient you are at lining these people's pockets.

I'm not too worried, though, because we've been through this kind of scenario before. Just be sure to lay low when the revolution comes. I'm only glad that I live in a state that has a clause in its constitution requiring it to have a balanced budget. We just might make it through the upheaval that's coming in one piece. You can laugh and joke about the Occupy prats if you want to, but they are a symptom of something bigger that you can't just laugh away.

http://www.usdebtclock.org/

Anyway, what the heck do I know? I'm just a desiccated scholar who lives in the past. Don't mind me. Ignore me long enough, and I'll fade away.

http://www.marketwatch.com/story/econom ... 2012-01-03