Argentine History Lesson
04-09-2011, 02:23 AM
#1
Elite Member
Thread Starter
iTrader: (24)
Join Date: Oct 2006
Location: Monterey, CA
Posts: 7,537
Total Cats: 42
Argentine History Lesson
http://www.changefor2012.com/2010/01...ke-up-america/
In the early 20th century, Argentina was one of the richest countries in the world. While Great Britain’s maritime power and its far-flung empire had propelled it to a dominant position among the world’s industrialized nations, only the United States challenged Argentina for the position of the world’s second-most powerful economy.
It was blessed with abundant agriculture, vast swaths of rich farmland laced with navigable rivers and an accessible port system. Its level of industrialization was higher than many European countries: railroads, automobiles and telephones were commonplace.
In 1916, a new president was elected. Hipólito Irigoyen had formed a party called The Radicals under the banner of “fundamental change” with an appeal to the middle class.
Among Irigoyen’s changes: mandatory pension insurance, mandatory health insurance, and support for low-income housing construction to stimulate the economy. Put simply, the state assumed economic control of a vast swath of the country’s operations and began assessing new payroll taxes to fund its efforts.
With an increasing flow of funds into these entitlement programs, the government’s payouts soon became overly generous. Before long its outlays surpassed the value of the taxpayers’ contributions. Put simply, it quickly became under-funded, much like the United States’ Social Security and Medicare programs.
The death knell for the Argentine economy, however, came with the election of Juan Perón. Perón had a fascist and corporatist upbringing; he and his charismatic wife aimed their populist rhetoric at the nation’s rich.
This targeted group “swiftly expanded to cover most of the propertied middle classes, who became an enemy to be defeated and humiliated.”
Under Perón, the size of government bureaucracies exploded through massive programs of social spending and by encouraging the growth of labor unions.
High taxes and economic mismanagement took their inevitable toll even after Perón had been driven from office. But his populist rhetoric and “contempt for economic realities” lived on. Argentina’s federal government continued to spend far beyond its means.
Hyperinflation exploded in 1989, the final stage of a process characterized by “industrial protectionism, redistribution of income based on increased wages, and growing state intervention in the economy…”
The Argentinian government’s practice of printing money to pay off its public debts had crushed the economy. Inflation hit 3000%, reminiscent of the Weimar Republic. Food riots were rampant; stores were looted; the country descended into chaos.
And by 1994, Argentina’s public pensions — the equivalent of Social Security — had imploded. The payroll tax had increased from 5% to 26%, but it wasn’t enough. In addition, Argentina had implemented a value-added tax (VAT), new income taxes, a personal tax on wealth, and additional revenues based upon the sale of public enterprises. These crushed the private sector, further damaging the economy.
A government-controlled “privatization” effort to rescue seniors’ pensions was attempted. But, by 2001, those funds had also been raided by the government, the monies replaced by Argentina’s defaulted government bonds.
By 2002, “…government fiscal irresponsibility… induced a national economic crisis as severe as America’s Great Depression
We’ve seen this movie before. The Democrats’ populist plans can’t possibly work, because government bankrupts everything it touches. History teaches us that ObamaCare and unfunded entitlement programs will be utter, complete disasters.
Today’s Democrats are guilty of more than stupidity; they are enslaving future generations to poverty and misery. And they will be long gone when it all implodes. They will be as cold and dead as Juan Perón when the piper must ultimately be paid.
I'd love to hear a counterargument.
In the early 20th century, Argentina was one of the richest countries in the world. While Great Britain’s maritime power and its far-flung empire had propelled it to a dominant position among the world’s industrialized nations, only the United States challenged Argentina for the position of the world’s second-most powerful economy.
It was blessed with abundant agriculture, vast swaths of rich farmland laced with navigable rivers and an accessible port system. Its level of industrialization was higher than many European countries: railroads, automobiles and telephones were commonplace.
In 1916, a new president was elected. Hipólito Irigoyen had formed a party called The Radicals under the banner of “fundamental change” with an appeal to the middle class.
Among Irigoyen’s changes: mandatory pension insurance, mandatory health insurance, and support for low-income housing construction to stimulate the economy. Put simply, the state assumed economic control of a vast swath of the country’s operations and began assessing new payroll taxes to fund its efforts.
With an increasing flow of funds into these entitlement programs, the government’s payouts soon became overly generous. Before long its outlays surpassed the value of the taxpayers’ contributions. Put simply, it quickly became under-funded, much like the United States’ Social Security and Medicare programs.
The death knell for the Argentine economy, however, came with the election of Juan Perón. Perón had a fascist and corporatist upbringing; he and his charismatic wife aimed their populist rhetoric at the nation’s rich.
This targeted group “swiftly expanded to cover most of the propertied middle classes, who became an enemy to be defeated and humiliated.”
Under Perón, the size of government bureaucracies exploded through massive programs of social spending and by encouraging the growth of labor unions.
High taxes and economic mismanagement took their inevitable toll even after Perón had been driven from office. But his populist rhetoric and “contempt for economic realities” lived on. Argentina’s federal government continued to spend far beyond its means.
Hyperinflation exploded in 1989, the final stage of a process characterized by “industrial protectionism, redistribution of income based on increased wages, and growing state intervention in the economy…”
The Argentinian government’s practice of printing money to pay off its public debts had crushed the economy. Inflation hit 3000%, reminiscent of the Weimar Republic. Food riots were rampant; stores were looted; the country descended into chaos.
And by 1994, Argentina’s public pensions — the equivalent of Social Security — had imploded. The payroll tax had increased from 5% to 26%, but it wasn’t enough. In addition, Argentina had implemented a value-added tax (VAT), new income taxes, a personal tax on wealth, and additional revenues based upon the sale of public enterprises. These crushed the private sector, further damaging the economy.
A government-controlled “privatization” effort to rescue seniors’ pensions was attempted. But, by 2001, those funds had also been raided by the government, the monies replaced by Argentina’s defaulted government bonds.
By 2002, “…government fiscal irresponsibility… induced a national economic crisis as severe as America’s Great Depression
We’ve seen this movie before. The Democrats’ populist plans can’t possibly work, because government bankrupts everything it touches. History teaches us that ObamaCare and unfunded entitlement programs will be utter, complete disasters.
Today’s Democrats are guilty of more than stupidity; they are enslaving future generations to poverty and misery. And they will be long gone when it all implodes. They will be as cold and dead as Juan Perón when the piper must ultimately be paid.
Reply
0
0
04-09-2011, 08:40 AM
#4
Total estimated 2010 Revenues: 2.3 Trillion
Total estimated 2010 Expenditures: 3.6 Trillion
Amount that spending has to be reduced to balance the budget: 36%
Amount that the democrats and republicans are fighting over: 2.5%
The democrats will bankrupt us.
The republicans will bankrupt us slower.
The democrats are extreme left, the republicans are slightly less left, the tea party is just barely right of center.
If the entitled people of this country aren't willing to bear the burden of a near bankruptcy, with lower SS checks, reduced medicare benefits, and significantly reduced medicaid benefits, they are going to bankrupt us.
I'm military - I would gladly accept a 25% pay cut if the government would also reduce the combination of SS, Medicare, and Medicaid payments by that same %. It's time to start thinking about SS, Medicare, and Medicaid as discretionary spending.
P.S. Anyone that thinks, even for a brief moment, that raising taxes on the wealthy is a good idea, should have their throats slit.
Total estimated 2010 Expenditures: 3.6 Trillion
Amount that spending has to be reduced to balance the budget: 36%
Amount that the democrats and republicans are fighting over: 2.5%
The democrats will bankrupt us.
The republicans will bankrupt us slower.
The democrats are extreme left, the republicans are slightly less left, the tea party is just barely right of center.
If the entitled people of this country aren't willing to bear the burden of a near bankruptcy, with lower SS checks, reduced medicare benefits, and significantly reduced medicaid benefits, they are going to bankrupt us.
I'm military - I would gladly accept a 25% pay cut if the government would also reduce the combination of SS, Medicare, and Medicaid payments by that same %. It's time to start thinking about SS, Medicare, and Medicaid as discretionary spending.
P.S. Anyone that thinks, even for a brief moment, that raising taxes on the wealthy is a good idea, should have their throats slit.
Reply
0
0
04-09-2011, 01:18 PM
#5
Elite Member
Join Date: Jul 2005
Posts: 6,420
Total Cats: 84
The 2 parties only differ in what flavor of Statism they openly push.
In reality the both support the other side.
For example. The Republicans believe in Empire and the War Machine. These are threats to liberty at home. By definition that requires big gov't. They merely pretend to be for smaller gov't and against huge entitlements. Case in point - the Medicare Prescription Drug Act of 2005 was spearheaded by the Republicans. And in one fell swoop it was the largest single increase in the gov't's unfunded liabilities, by something like 10%. You don't see the media explaining this.
The Democrats believe in Socialsim aka Welfarism and wealth re-distribution. They believe in "good gov't" micro-managing our lives a la Sweden. They *pretend* to be pro civil liberties. Case in point: Obama the supposed Constitutional scholar supports the doublespeak-named Patriot Act. And the Democrats pretend to be anti war, yet voted to support all the wars, and never even asserted the constitutional requirement that Congress vote on all acts of war.
But never fear. The Federal Gov't will go insolvent. It's not a question of if. It's hardly even a question of when. It's a question of how.
The debt + unfunded liabilities for the next 30 years (mainly Medicare, not including Obamacare), is > $1M per taxpayer in today's dollars. Does the average taxpayer have $1M to pay in *additional* taxes? No.
Imagine if you owed $1M, you spend 10% more than you earn year after year, and you keep borrowing more money just to pay the *interest* alone on the outstanding balance. What keeps you afloat is your high credit score and thus the interest rate you pay is 2%, limiting the cost of the interest payments to 10% of your monthly expenses. Your only real option to pay it back is to cut your expenses by 30% across the board and never increase it, never borrow more money, and pay down the principal aggressively. You know you have to do that.
But instead, you continue on, and risk getting your credit score dinged - and then your interest rates can triple to 6%, and the 10% of your income which goes to paying just the interest, will climb to 30%. At this point, it will be impossible to repay the debt. You would have to cut your budget by 60%, or simply default and declare bankruptcy.
This is where the Fed Gov is.
Anyone who doesn't agree after checking out the numbers is delusional.
Cutting spending is politically impossible. It has never happened outside of the end of major wars.
The posturing by Congress in recent news, quibbling over 1% of the budget, is just that - posturing. If the Republicans were serious about long term financial solvency, they'd be discussing 30% spending cuts.
Pretty soon there needs to be a vote on the debt ceiling. Legally they need to raise it in order to borrow more money. I will wager my left one that they will raise it, just as they have, year after year. And then the fate of the Fed Gov will be cemented.
It will go insolvent.
Then the gov't budget crisis will get so bad they will *need* to do something. It's a question of which voting blocs, which handout recipients, will be stiffed, and in what sequence.
The Federal Reserve will buy the Treasury Debt - which means inflation. Mass inflation. Like >10% per year. They will stop just short of hyperinflation. Hyperinflation means the money dies. If the money dies, the power of the bankers will die with it. They don't want that.
In the end, the Fed Gov's budget will be cut, and when a gov't's budget is cut, their power is cut.
And then the States will probably invoke the 10th Amendment, and a Great De-Centralization of power will begin.
And then we will finally start to see our liberty increasing instead of decreasing. With liberty comes prosperity.
But not before a period of pain.
Just like Chile and Argentina. They went through a period of pain, then things got better.
The USA has the advantage that the strong entrepreneural spirit is still alive. And the ideas of "leave me alone" and "let's make a deal". That embodies economic freedom, and from that comes prosperity.
The same fate awaits almost all the "liberal" (welfarist) governments of the Western World. The cradle-to-grave welfare model of the West is unsustainable. Almost every welfare gov't is on the road to insolvency. Asia OTOH isn't addled by it. However, Japan, Korea, and China have serious long term demographic problems of their own... But in the medium term, they will be the new economic powerhouses. In the very long term, the Internet has educated a small minority to the ministrations of the various power elite groups around the world, and that they are anti freedom and that freedom and prosperity go hand in hand..... I believe the internet will do today, what the Guttenberg Press did centuries ago. It ended that era's tyranny, and ushered in a new age of prosperity.
Reply
0
0
04-09-2011, 02:16 PM
#6
Newb
Join Date: Sep 2005
Location: The valley in PA
Posts: 32
Total Cats: 0
total estimated 2010 revenues: 2.3 trillion
total estimated 2010 expenditures: 3.6 trillion
amount that spending has to be reduced to balance the budget: 36%
amount that the democrats and republicans are fighting over: 2.5%
the democrats will bankrupt us.
The republicans will bankrupt us slower.
total estimated 2010 expenditures: 3.6 trillion
amount that spending has to be reduced to balance the budget: 36%
amount that the democrats and republicans are fighting over: 2.5%
the democrats will bankrupt us.
The republicans will bankrupt us slower.
Reply
0
0
04-09-2011, 05:14 PM
#7
Elite Member
Join Date: Jul 2005
Posts: 6,420
Total Cats: 84
Here's why spending cuts are politically impossible.
Once a voting bloc has started receiving dole outs, they never want to give it up.
Bastiat has said, "Government is the great fiction by which everybody lives off of everybody else". This is the fundamental issue with the welfare state. Then we run out of other people's money.
Rick Scott got elected governor of Florida on a platform to cut taxes and spending. So, he has offered his budget. It cuts $4.6 billion. The voters in February disapproved of him by 22%. Now that they have seen the cuts -- 8,600 government jobs will go -- they disapprove by 48%:
http://www.bloomberg.com/news/2011-0...poll-says.html
Nobody wants to give up their dole outs - they want someone else to give up theirs.
And so it goes... towards insolvency.
Once a voting bloc has started receiving dole outs, they never want to give it up.
Bastiat has said, "Government is the great fiction by which everybody lives off of everybody else". This is the fundamental issue with the welfare state. Then we run out of other people's money.
Rick Scott got elected governor of Florida on a platform to cut taxes and spending. So, he has offered his budget. It cuts $4.6 billion. The voters in February disapproved of him by 22%. Now that they have seen the cuts -- 8,600 government jobs will go -- they disapprove by 48%:
http://www.bloomberg.com/news/2011-0...poll-says.html
Nobody wants to give up their dole outs - they want someone else to give up theirs.
And so it goes... towards insolvency.
Reply
0
0
04-09-2011, 07:48 PM
#8
Elite Member
Join Date: Jul 2007
Location: Houston, TX
Posts: 3,201
Total Cats: 145
Good read pertaining to the topic
http://www.amazon.com/Modern-Surviva...2392870&sr=8-1
Product Description
My book is a Modern Survival Manual based on first hand experience of the 2001 Economic Collapse in Argentina. In it you will find a variety of subjects that I consider essential if a person wants to be prepared for tougher times: -How to prepare your family, yourself, your home and your vehicle -How to prepare your finances so that you don't suffer what millions in my country went through -How to prepare your supplies for food shortages and power failures -How to correctly fight with a chair, gun, knife, pen or choke with your bare hands if required -Most important, how to reach a good awareness level so that you can avoid having to do all that These are just a few examples of what you will find in this book. It's about Attitude, and being a more capable person and get the politically correct wimp out of your system completely.
About the Author
Fernando "FerFAL" Aguirre is a father, husband and survivalist that has lived through the Argentine socio-economic collapse of 2001, and the consequences such collapse had in the years that followed. He's the author of numerous articles found on line and is recognized among the survival and preparedness community for his personal experience and no-nonsense approach to survivalism. He's also the publisher and owner of "Surviving in Argentina", a blog he keep up with updated articles, posts as well as reports of the situation in Argentina.
http://www.amazon.com/Modern-Surviva...2392870&sr=8-1
Product Description
My book is a Modern Survival Manual based on first hand experience of the 2001 Economic Collapse in Argentina. In it you will find a variety of subjects that I consider essential if a person wants to be prepared for tougher times: -How to prepare your family, yourself, your home and your vehicle -How to prepare your finances so that you don't suffer what millions in my country went through -How to prepare your supplies for food shortages and power failures -How to correctly fight with a chair, gun, knife, pen or choke with your bare hands if required -Most important, how to reach a good awareness level so that you can avoid having to do all that These are just a few examples of what you will find in this book. It's about Attitude, and being a more capable person and get the politically correct wimp out of your system completely.
About the Author
Fernando "FerFAL" Aguirre is a father, husband and survivalist that has lived through the Argentine socio-economic collapse of 2001, and the consequences such collapse had in the years that followed. He's the author of numerous articles found on line and is recognized among the survival and preparedness community for his personal experience and no-nonsense approach to survivalism. He's also the publisher and owner of "Surviving in Argentina", a blog he keep up with updated articles, posts as well as reports of the situation in Argentina.
Reply
0
0
Thread
Thread Starter
Forum
Replies
Last Post
Jike Spingleton
Cars for sale/trade
3
09-20-2016 04:33 PM
