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September 22, 2011

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Like Thomas Friedman, I wish there were some politicians who stood for "proposals that match the scale of our debt problem." Unfortunately, that would be a very unpopular position. Most of us are in denial over the magnitude of the deficit.

Given today's federal tax rates, commitments and predilictions, a realisic estimate is that going forward the federal government will continue to spend around 50% more than it collects. To match the scale of the problem would require something like:

1. Cut all federal spending by 50%.

Or:

2. Increase FICA payments and all federal taxes and assessments by 33%.

Or, split the difference:

3. Cut all federal spending by 25% and increase all revenues by 17%.

Friedman calls the Tea Parties "radical." Can you imagine what he'd call a proposal that really matched the scale of our debt problem?

P.S. I believe Friedman actually meant the "deficit problem", not the "debt problem". In order to cut down the national debt, the federal government would have to run budget surpluses. That would require even larger spending cuts and/or tax increases than those above.

I doubt there will be a credible third party candidate in 2012. But... I would suspect that Mitt Romney is more likely than Perry. I think the base is more likely to get energized than the moderates.

Mooney's careless discussions of Ipsos flawed survey led to Brendan's lack of precision. The problem is confusion over definitions of terms.

It started with Ipsos strange grammar, asking whether the World’s temperature has been going up in the past 100 years. A clearer question would have asked if the temperature did go up. In their write-up, Ipsos shortened this question to whether "the earth has been warming" without specifying a time period. In fact, the
earth cooled over the last 12 years, so the specified time period is crucial. Cynics might suspect that Ipsos chose this unclear wording in order to be able to get the result they wanted.

Ipsos described the belief that the earth hasn't warmed in the last 100 years as "not believing in global warming." I think most people would interpret the phrase "belief in global warming" to mean belief that warming is occurring today and will continue.

Ipsos asked about the degree of belief that the earth warmed in the last 100 years. However, Ipsos didn't ask about the degree of belief that the earth will warm in the next 100 years. Nor did they ask how much the respondant thought the temperature would rise in the next 100 years or the degree of belief in various amounts of anticipated warming. These are two of the main areas of controversy. Their omission was unfortunate. Expensive remedies are justified only if one has a high degree of belief that we will experience a very large amount of warming.

Having been misled by Ipsos and Mooney's sloppy wording, Brendan mistakenly wrote, "More independents think global warming is occurring, but those who don't have become more certain in their beliefs." What the survey actually showed was that more independents think global warming occurred during the last 100 years, but those who don't have become more certain in their beliefs.

@David in Cal. If government spends 50% more than they collect and reduce spending by 50% this will yield a surplus, 25% of tax collections. We can use this money to send every person in America into a Basic Math Skills course.
I'm a jerk.

Thanks JP for pointing out my error. The percentages were reversed. In order to balance the budget, the federal government would have to cut spending 33% or raise all taxes and fees by 50% or some equivalent combination.

Sorry for the error.

Dems and Reps debate whether more "stimulus" will cause inflation. However, we are already in an inflationary spiral.

Inflation in 2010 was 1.5%. So far, 2011 inflation (12/31/10 - 8/31/11) has run at an annual rate of 5.1%. That's a big jump. By comparison, Richard Nixon instituted wage and price controls (which proved to be a disaster) because US inflation was persisting above 4%.

Furthermore, it's by no means clear that further "stimulus" will add jobs. Many believe that government spending is always a burden on private industry. If this is the case, then the extra spending permitted by printing more money will harm business. And, inflation itself will harm business. Hyperinflation can bring a government. We know what hyper-inflation in post-WWI Germany led to.

IMHO the Fed is playing with fire. Their main responsibility is supposed to be preventing inflation. When the Fed tries to create inflation, it's like the fire department being used to set fires (a la Farenheit 451).

Mooney ends his global warming article by damning the "extremists". Given the article's focus on polarization, one might hope that Mooney means extremists on both sides -- those with extreme belief in Catastrophic Anthropogenic Global Warming as well as those with extreme doubt. However, Mooney is one of the former, so he evidently means only the latter. For Mooney, the word "extremists" in effect means people who disagree with him.

Mooney's class of so-called "extremists" would include Nobel Prize winning physicist Ivar Giaever, MIT Professor Richard Lindzen, Princeton-based physicist Freeman Dyson, and many other eminent scientists. It's too bad that Mooney uses ad hominem attacks, rather than address their scientific analyses.

David in Cal is correct we need to keep the inflation monster in the jar. Just like the cartoon from the ECB told us.

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