On Tue, Mar 30, 2010 at 7:11 PM, Sandy Harris <sandyinchina at gmail.com> wrote:
> On 3/31/10, Doug Henwood <dhenwood at panix.com> wrote:
>
>> The whole strategy of doing a present value analysis of pension obligations
>> makes no sense to me, except as a scaremongering tactic. Governments are for
>> these purposes immortal, and have tremendous power to tax, and all that
>> matters is their ability to cover next year's obligations with next year's
>> revenues, ad infinitum. Is there any rational economic reason for this sort
>> of analysis except to promote an austerity program?
>
> There are limits on the power to tax, especially if they want to be
> re-elected. Yes, you can milk the rich some more, but they have
> options like moving offshore, and they have political influence
> which leads to hand-outs rather than milking.
>
> Governments routinely cover obligations not with revenue but with
> deficits. They've been doing that for decades, and some have been
> mis-treating pension contributions as general revenue. What is the
> current level of gov't debt? The interest on it?
>
> At some point, the whole ponzi scheme becomes unsustainable.
> My guess is the US is getting close to that point. Two wars, both
> expensive, big giveaways to crooked bankers, ...
> ___________________________________
> http://mailman.lbo-talk.org/mailman/listinfo/lbo-talk
>