Friday, January 01, 2010

Argentina's Economic Collapse - and where is our money going now?

We implemented the Federal Reserve System in 1913. If it takes around 100 years to implode an economy, then perhaps we are looking at 2013 or so for these issues to manifest. The Argentinean central bank was established in 1935, and in 2002 their economy totally tanked. It only took them 67 years. I believe America is just slightly behind, because we have so many people that watchdog these bastards. Oh, and just so you know, several trends forecasters peg 2010 as a really bad year, with economic collapse in the next 2 years, right on track.

Everyone should take notice of this, and don't just simply pass it off as coincidence. Our history is vitally important to understand what our future is going to hold. Perhaps we should step back and stop worrying as much about international terrorism and focus on the home front for a while.

37,300 people died on our highway system in the United States last year. We aren't banning cars and trucks.

106,000 or so die from pharmaceutical drugs (while in hospitals). We continue to allow companies like Bayer, Agfa and Novartis to make drugs. 198,000 or so die from drug related problems, like over the counter medicines.

About 8.8 million people are hospitalized each year because of bad interactions with prescribed drugs.

About 438,000 people die from smoking cancer ridden, chemical based cigarettes and second-hand smoke each year.

10,000 or so die from recreational drugs like crack, speed, ecstasy, etc. We created a police state to handle this huge problem...

There were over 860,000 foreclosures/bank turnovers in 2008 alone. That was out of a whopping 3.1 million foreclosure filings. Thats a lot of people not managing their finances well.

Statistics prove prescription drugs are 16,400% more deadly than terrorists

Terrorism Still Less Deadly in US Than Lack of Health Insurance, Salmonella (good graph here)

I AM NOT BELITTLING THE SEVERITY OF TERRORISM. I am simply trying to point out that more people have massive death experiences regardless of how much our military or militarized police forces go about their business each day. For God’s sake, we are now trying to force people into full body scanners at the airports. I say issue a luger to everyone who wants one (*) on the plane, with rubber bullets, and issue the flight crew shotguns with rubber loads. I guarantee that terrorism and hijackings stop overnight.

Lets seriously consider where we put our efforts when talking politics and spending. Should we be worrying about some phantom terrorists around every corner, and underwear bombers? Or in fact should we be more concerned with how Goldman Sachs is stealing billions and the Rockefeller and Rothschild syndicates rape this country?

We need to understand finances and how the scammers, i.e. bankers operate.

Do We Fear the Right Things?

Don't Cry For Me, 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 Argentinean 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."

In 1902 Argentina was one of the world's richest countries. Little more than a hundred years later, it is poverty-stricken, struggling to meet its debt obligations amidst a drought.

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.

(*) My caveat is that you show proof of firearms training and you are over 18. But seriously consider the positive effects of an armed populous instead of sniveling scaredy-cats.


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