Post by: The Rabbi on September 04, 2007, 01:19:55 PM
Hello? There is only one other way to go, and that's raising payroll taxes. But she won't tell you that part. Neither will the media.
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WASHINGTON - Democrat Hillary Rodham Clinton promised retirees that if elected president she will not cut Social Security benefits, raise the retirement age or privatize the taxpayer-funded system.
The New York senator told the AARP's legislative conference that she would bring a "renewed national commitment to Social Security" to the White House.
"This is the most successful domestic program in the history of the United States," Clinton said to applause from seniors gathered in Washington to push their policy agenda. "When I'm president, privatization is off the table because it's not the answer to anything."
She also said she does not support cutting benefits or increasing the retirement age. Seniors can begin collecting partial benefits at age 62, with full benefits available at age 67 for those born in 1960 or later. Clinton said instead she will protect the program through fiscal responsibility and criticized President Bush's leadership on the issue.
Bush sought to change the program to create personal savings accounts while trimming future benefits for workers younger than 55. Democrats rallied in opposition, and Republicans shrank from the political challenge of remaking a program that provides benefits to millions of elderly voters.
The New York senator told the AARP's legislative conference that she would bring a "renewed national commitment to Social Security" to the White House.
"This is the most successful domestic program in the history of the United States," Clinton said to applause from seniors gathered in Washington to push their policy agenda. "When I'm president, privatization is off the table because it's not the answer to anything."
She also said she does not support cutting benefits or increasing the retirement age. Seniors can begin collecting partial benefits at age 62, with full benefits available at age 67 for those born in 1960 or later. Clinton said instead she will protect the program through fiscal responsibility and criticized President Bush's leadership on the issue.
Bush sought to change the program to create personal savings accounts while trimming future benefits for workers younger than 55. Democrats rallied in opposition, and Republicans shrank from the political challenge of remaking a program that provides benefits to millions of elderly voters.
Post by: Monkeyleg on September 04, 2007, 01:33:55 PM
I'd like to see her idea of a failure.
There are only so many options available. If cutting benefits isn't an option (and it isn't for me), and increasing the age isn't an option (I'd oppose that, too), and privatization isn't an option (too bad, it's the best idea)...well, young people, get ready to pay 25% of your income to SS.
Post by: The Rabbi on September 04, 2007, 01:49:07 PM
For the rest of us younger folks, it's a Ponzi Scheme.
Post by: Monkeyleg on September 04, 2007, 02:09:48 PM
Oh, yeah. My father, age 90, started paying into the system in 1937. IIRC, it was something like ten cents a week or a month.
He's been receiving the highest possible monthly benefit for 25 years. Right now that's $1800+, or over $21,600 a year. I looked at the SS site, and figure he's received about $460,000 since he retired.
There's no way that he paid even a fraction of that amount into the system.
Meanwhile, I've payed about $130,000 into SS (FICA and co-FICA) since 1966, with most of that paid in from 1978 on. My monthly FICA and co-FICA payments have been right around $1000 for many years.
I'll be eligible for SS in less than nine years. But I'll never see that kind of "return." And my nieces and nephews will be paying a much higher percentage.
Post by: Paddy on September 04, 2007, 02:49:53 PM
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But she promises to "save social security" through "renewed commitment."
Hello? There is only one other way to go, and that's raising payroll taxes.
Hello? There is only one other way to go, and that's raising payroll taxes.
There is another way. Quit filching the money from the system and replacing it with low (or no) interest IOU's. Instead, invest the money in, say, index funds.
Post by: Headless Thompson Gunner on September 04, 2007, 03:11:21 PM
Post by: jnojr on September 04, 2007, 03:16:02 PM
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But she promises to "save social security" through "renewed commitment."
Hello? There is only one other way to go, and that's raising payroll taxes.
Hello? There is only one other way to go, and that's raising payroll taxes.
There is another way. Quit filching the money from the system and replacing it with low (or no) interest IOU's. Instead, invest the money in, say, index funds.
Can't be done. What happens if (when!) there's a market downturn, and they need the money now, not in a couple of years?
And the "IOUs" are actually interest-bearing Treasury instruments. The problem with that is, in order for the Treasury to redeem those instruments, they must either take money from tax receipts or print it up... since the government does not generate wealth or turn a profit, there is nowhere else for that money to come from. A business may borrow money, use that money to make more money, and pay the interest and principle of the loan they took out from those profits. The government has no such option... every dollar they borrow, and all of the interest to be paid on that borrowed money, must be confisacted from taxpayers or conjured out of thin air. Or, I suppose, it's theoretically possible that they could sell various assets, but if the US government sold every building, every piece of land, ever fighter jet, etc. they would have enough to pay a tiny fraction of what they owe.
The only answer is to phase Socialist inSecurity out as rapidly as possible, but that isn't going to happen, so the system is going to have to collapse. And everyone in Washington DC knows this... all they care, though, is that the crash happens when they're safely out of office, so the current incumbents will be blamed. The angry taxpayers won't care about the current politicians pointing their fingers at past politicians, saying "But they handed us this mess! We never had a chance to do anything!" It won't matter... we'll want blood, and digging up some decades-old corpses to hang from lampposts won't do it.
Revolution or complete collapse. There is no other possibility for this country.
Post by: Paddy on September 04, 2007, 03:34:38 PM
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Ya mean like Bush's plan?
Doubtful. What Bush says and what he does are completely unrelated.
It's basically the government's problem. Politicians will not get away with cutting off social security benefits, whether they have to borrow, print, or tax. And frankly, I don't care what they do. No skin off my b**ls.
Post by: The Rabbi on September 04, 2007, 04:16:11 PM
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But she promises to "save social security" through "renewed commitment."
Hello? There is only one other way to go, and that's raising payroll taxes.
Hello? There is only one other way to go, and that's raising payroll taxes.
There is another way. Quit filching the money from the system and replacing it with low (or no) interest IOU's. Instead, invest the money in, say, index funds.
That would make the gov't the majority shareholders in many companies. They would be in a position to dictate policy. Does anyone think the gov't will refrain from using this power for more and more interference?
Post by: Headless Thompson Gunner on September 04, 2007, 05:32:19 PM
Post by: The Rabbi on September 04, 2007, 05:34:00 PM
Perhaps Hillary could have one of her illegal Chinese contacts fund our Social Security system. They have lots of money, and she seems to have no shortage of them.
Yeah, but retirees don't allow export of sensitive technical stuff or weapons and seldom have access to military secrets. It's quid pro quo, even in Chinese.
Post by: Paddy on September 04, 2007, 06:16:06 PM
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That would make the gov't the majority shareholders in many companies. They would be in a position to dictate policy. Does anyone think the gov't will refrain from using this power for more and more interference?
Not necessarily. Set up a firewall; some sort of blind trust. It's done everyday.
Post by: HankB on September 05, 2007, 03:32:34 AM
It's succesful from the point of view of the people who initially paid into it in the 1940s-1960s. Their return on investment was phenomenal.
Some years back, when Fortune magazine had a column called Keeping Up, they studied the rate of return.They assumed a person had retired that year at age 65 after paying the maximum amount into SS since, IIRC, age 21. They included his contributions, his employer's contributions, and assumed a 3% rate of return, had he invested the money himself.
The lump sum that resulted would have, at that time, allowed the hypothetical retiree to purchase a lifetime annuity that paid 75% more than his maximum SS benefit.
One problem with SS is that there are too many people besides retirees collecting - it's become another welfare program. When my dad retired and applied for benefits, he guessed that somewhere between 2/3 and 3/4 of the other applicants in the SS office were nowhere near retirement age . . . and at least half of those spoke no English.
Another problem is taxation of benefits, instituted by Reagan (Thanks Ronnie!) and made worse by Clinton. The government pays a benefit to a senior, then the taxman takes some of it and it goes into the general fund, NOT back into SS. This is a way for the government to pirate the fund, without any pretense of paying it back. IMHO, if the benefits ARE taxed - they shouldn't be, but let's say they are - the revenue ought to go right back into the SS trust fund.
Post by: K Frame on September 05, 2007, 04:21:13 AM
It's kill all the old people.
Post by: Fjolnirsson on September 05, 2007, 05:04:02 AM
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"When I'm president, privatization is off the table because it's not the answer to anything."
I think this says all anyone needs to know about Hilary....
Post by: El Tejon on September 05, 2007, 05:15:19 AM
I laughed all the way through it.
After talking to my CFP and my father, I believe that the feds will have to raise FICA contributions and confiscate my SEP and Roths (eeevil white males like El Tejon invested privated and hurt women and minorities, time to stick it to whitey, yet again) is what I anticipate and am making the necessary arrangements. I would guess that the estate tax will not die and will come back with a vengence.
Post by: charby on September 05, 2007, 05:32:30 AM
Mike, have you read this book=>http://www.newstatesman.com/200705210049???
I laughed all the way through it.
After talking to my CFP and my father, I believe that the feds will have to raise FICA contributions and confiscate my SEP and Roths (eeevil white males like El Tejon invested privated and hurt women and minorities, time to stick it to whitey, yet again) is what I anticipate and am making the necessary arrangements. I would guess that the estate tax will not die and will come back with a vengence.
I laughed all the way through it.
After talking to my CFP and my father, I believe that the feds will have to raise FICA contributions and confiscate my SEP and Roths (eeevil white males like El Tejon invested privated and hurt women and minorities, time to stick it to whitey, yet again) is what I anticipate and am making the necessary arrangements. I would guess that the estate tax will not die and will come back with a vengence.
They may not confiscate your ROTH but they may decide to tax your withdraws.
Post by: El Tejon on September 05, 2007, 06:35:09 AM
Post by: The Rabbi on September 05, 2007, 06:44:04 AM
Is that not confiscation???
No, that's changing rules midstream. Not unknown of course.
Post by: French G. on September 05, 2007, 06:53:21 AM
Post by: Tallpine on September 05, 2007, 07:01:39 AM
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6% self-employment tax
More like 7.53% counting Medicare
(or about 15% total)
Post by: Werewolf on September 05, 2007, 07:41:00 AM
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It's kill all the old people
Uhhhhhhh - Define OLD...
Post by: Paddy on September 05, 2007, 08:39:36 AM
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There's another way, and Hillary won't tell you that, either...
It's kill all the old people.
It's kill all the old people.
Well, you did say you are German.
It wouldn't surprise me to learn plans are well underway. At first, I thought it might be happening already with chemtrails http://en.wikipedia.org/wiki/Chemtrail_theory but the 'old people' don't seem to be dying off very quickly.
However, I see a new possibility on the horizon. There is a trend of defective and dangerous 'Made in China' products, setting us up for the plan to poison some pharmaceutical (or other product?) used almost exclusively by 'old people'. As the boomers suddenly take dirt naps by the millions, the government will remain 'perplexed' as the 'investigation continues'.
Don't get too cocky, though. The NWO won't stop there. They'll cull the rest of you 'useless eaters' later, after you've served your purpose.
Post by: Hutch on September 05, 2007, 09:41:42 AM
Who knows, maybe one day it WILL happen.
Post by: HankB on September 05, 2007, 10:35:39 AM
. . . There is a trend of defective and dangerous 'Made in China' products, setting us up for the plan to poison some pharmaceutical (or other product?) used almost exclusively by 'old people'. As the boomers suddenly take dirt naps by the millions, the government will remain 'perplexed' as the 'investigation continues' . . .
And to replace the oldsters . . . well, I just read a story about thousands of defective, Communist Chinese-made condoms being distributed in New York . . .
Post by: Euclidean on September 05, 2007, 05:35:18 PM
The real problem is people who just barely make ends meet (because income tax takes 1/3 or more of their small checks) wind up seeing the money they would use to invest sucked up by the Social Insecurity scheme, so their future is completely dependent on the government.
Post by: Headless Thompson Gunner on September 05, 2007, 05:57:06 PM
The real problem is people who just barely make ends meet (because income tax takes 1/3 or more of their small checks) wind up seeing the money they would use to invest sucked up by the Social Insecurity scheme, so their future is completely dependent on the government.
Freaky, isn't it? It's almost like they planned it that way...
Post by: tokugawa on September 19, 2007, 05:14:21 AM
Post by: longeyes on September 19, 2007, 06:13:12 AM
We don't have hyper-inflation, we have hypno-inflation. The value of the U.S. dollar trends inexorably downward...while Bush fiddles and America diddles.
Post by: Moondoggie on September 19, 2007, 08:15:43 AM
Many folks gloss over the concept that there is no SS "Fund". The fedcoats have been using SS witholding $ as general tax revenues for decades, and still running deficeit budgets to boot. If the fedcoats had to run on a balanced budget as most states/counties/municipalities do, the world would be a much different place today. And I think it would be a better place, just to toss my 2 cents in there.
The fedcoats are no different than crack addicts, except that their drug is OUR $, and they'll lie, cheat, steal and sell their souls to get it.
Post by: The Rabbi on September 19, 2007, 08:17:01 AM
Hillary's plan is to put everyone on Medicare and on Social Security. That's socialism with a Hillary face.
We don't have hyper-inflation, we have hypno-inflation. The value of the U.S. dollar trends inexorably downward...while Bush fiddles and America diddles.
Wow, a post on Hillarycare and you still manage to get in a dig at Bush. I think you secretly have a thing for the guy.
We don't have hyper-inflation, we have hypno-inflation. The value of the U.S. dollar trends inexorably downward...while Bush fiddles and America diddles.
Post by: Euclidean on September 19, 2007, 10:00:41 AM
, but why can't we just pass a law that says every American must either deduct so much money for SS payments, or else invest that same money in an IRA or mutual fund, 401k, 403b, etc.? I guarantee you that every bank and financial institution in existence would start clamoring for the business and developing superior alternatives to the SS Pontzi scheme.I believe in less than two generations we'd see SS start to die of atrophy.
Now don't get me wrong I philosophically still think that the damn government has no business telling you how to spend your cash at all, but this is a modest proposal which would have a much better chance of passing Congress.
Post by: The Rabbi on September 19, 2007, 10:56:32 AM
So that idea died.
Post by: longeyes on September 19, 2007, 09:57:39 PM
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Wow, a post on Hillarycare and you still manage to get in a dig at Bush. I think you secretly have a thing for the guy.
Bill Clinton is George's adopted step-brother, isn't he? And that makes Bush and Hillary kin too by my reckoning. I don't think they are as different as you apparently do. Bush presents himself as an alternative to the Dems but actually furthers their grand design.
My "thing" for Bush is morbid curiosity.
Post by: tyme on September 20, 2007, 12:19:12 AM
Post by: doczinn on September 20, 2007, 05:46:58 AM
Post by: Paddy on September 20, 2007, 06:23:16 AM
I've often wondered... and I guess Riles or someone will come along and chew me out for being a dumbass libertarian , but why can't we just pass a law that says every American must either deduct so much money for SS payments, or else invest that same money in an IRA or mutual fund, 401k, 403b, etc.? I guarantee you that every bank and financial institution in existence would start clamoring for the business and developing superior alternatives to the SS Pontzi scheme.
I believe in less than two generations we'd see SS start to die of atrophy.
Now don't get me wrong I philosophically still think that the damn government has no business telling you how to spend your cash at all, but this is a modest proposal which would have a much better chance of passing Congress.
, but why can't we just pass a law that says every American must either deduct so much money for SS payments, or else invest that same money in an IRA or mutual fund, 401k, 403b, etc.? I guarantee you that every bank and financial institution in existence would start clamoring for the business and developing superior alternatives to the SS Pontzi scheme.I believe in less than two generations we'd see SS start to die of atrophy.
Now don't get me wrong I philosophically still think that the damn government has no business telling you how to spend your cash at all, but this is a modest proposal which would have a much better chance of passing Congress.
Actually, I agree with that and here's why. 1)Invested $$ growth would be huge compared to whatever SS would pay, supplanting what are now private pensions, and 2) The increase supply of cash in the capital markets would be a catalyst to business, AND bring down interest rates- it's a WIN-WIN
The problem, though, is the timing. There are millions of baby boomers coming into retirement and that will continue for years. If we begin to divert 'contributions' from SS now, there won't even begin to be enough current cash flow to offset benefits (fed.gov having long since plundered and squandered what should have been a SS 'fund'.
So it's kind of 'crunch time' for SS. I would like to see the younger people get off the hook and have the freedom to invest their retirement dollars. OTOH, a lot of us have paid into SS all our working lives and 'benefit' time is right around the corner.
Post by: roo_ster on September 20, 2007, 06:26:29 AM
Post by: Silver Bullet on September 20, 2007, 06:33:51 AM
My opinion is that if something like social security is mandatory for anybody it should be mandatory for everybody.
I'm guessing the same thing is going to happen with national health care, if it gets that far. There will be one level of service ("Ticket #56. Now serving #18") for the little people and another level ("Would you care for a glass of merlot while you're waiting ? It may be a whole five minutes before we can see you.") for the ruling class.
Post by: Paddy on September 20, 2007, 06:41:27 AM
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25 years ago I read somewhere that government employees, on some level, are exempt from social security taxes and benefits because they already have retirement benefits far in excess of what social security provides. Does anyone know if that is true ?
PERS Public Employees Retirement System. I think every state has one. Congress cretins don't participate in SS either, they've got their own 'special plan'. Just for them.
Post by: charby on September 20, 2007, 07:15:22 AM
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25 years ago I read somewhere that government employees, on some level, are exempt from social security taxes and benefits because they already have retirement benefits far in excess of what social security provides. Does anyone know if that is true ?
PERS . I think every state has one. Congress cretins don't participate in SS either, they've got their own 'special plan'. Just for them.
When I was working for a school district I paid into Iowa Public Employees Retirement System or IPERS. I also had to pay SS tax also. I know work for a State University and pay SS also. I cashed out my IPERS (my contributions only I wasn't vested yet) when I left the school district and moved to a IRA, I figured it would be better to let me manage my own money than take a $6 a month check when I hit 70.
My father works for the BNSF railroad and hasn't paid SS since 1971 when he was hired by Railroad (then is was called Burlington Northern). He has paid into railroad retirement his whole working career. I have a friend who has retired from federal government and I think that he never paid SS during his working career but paid into some federal pension plan.
-C
Post by: jnojr on September 20, 2007, 11:13:06 AM
why can't we just pass a law that says every American must either deduct so much money for SS payments, or else invest that same money in an IRA or mutual fund, 401k, 403b, etc.?
Because that would not involve any wealth redistribution or government control over our lives.
Post by: Monkeyleg on September 20, 2007, 12:39:03 PM
Post by: Paddy on September 20, 2007, 12:50:55 PM
Members of congress pay Social Security.
You're right. They started in 1983
http://www.ntu.org/main/page.php?PageID=21
Post by: Phantom Warrior on September 21, 2007, 02:17:06 AM
Quote from: RileyMc
The problem, though, is the timing. There are millions of baby boomers coming into retirement and that will continue for years. If we begin to divert 'contributions' from SS now, there won't even begin to be enough current cash flow to offset benefits (fed.gov having long since plundered and squandered what should have been a SS 'fund'.
That is exactly the problem. Yet I don't understand why the government doesn't simply implement private savings plans and fund the difference out of other income until all the current SS obligations are out of the system. Yes, that will be extremely expensive, but unlike most other government programs it will eventually go away as the proportion of private savings funded retirees increase.
AND IT'S NOT LIKE THE PROBLEM GOES AWAY IF YOU IGNORE IT!!!!!! (Are you listening, Congress?) Continuing with the current Ponzi scheme SS doesn't address the problem that SS will eventually be insolvent (about the time I retire) and that no actual wealth is being created. It's just a wealth redistribution scheme and a continuing meltdown.
Euclidean,
The reason it doesn't happen is every time the idea is raised, just like Bush did a few years back, the Democrats and the AARP start clamoring about how "Bush and his fat cat buddies on Wall Street are playing fast and loose with your grandparents' SS benefits and they are going to end up eating dog food if you listen to him..." So, predictably, nothing was done. See my rant in the above paragraph.
Post by: tyme on September 21, 2007, 04:52:14 AM
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Yet I don't understand why the government doesn't simply implement private savings plans and fund the difference out of other income until all the current SS obligations are out of the system. Yes, that will be extremely expensive, but unlike most other government programs it will eventually go away as the proportion of private savings funded retirees increase.
The net cost to the government that would need to be made up is (average payout * payees) - (average SS contribution * employed SS participants).What could work is a partitioning of the working population. Let everyone born after 1975 switch to private savings. The shortfall to be made up would be dramatically less, because there would still be a lot of participants and significant SS contributions from them. Unfortunately, everyone born before the deadline would have to continue paying into SS until retirement, to prevent the government from having to make up the entire cost of SS entitlements.
Or they could do something progressive, like let everyone switch to private accounts and then institute a huge progressive tax so that the upper class ends up paying for most of the unfunded SS liabilities.
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AND IT'S NOT LIKE THE PROBLEM GOES AWAY IF YOU IGNORE IT!!!!!! (Are you listening, Congress?)
It's in Congresscritters' best interest to put off lose-lose legislation like that until the next session, because then they have a better (near-certain) chance of getting re-elected. This is why theoretically unsound plans like SS should never be adopted in the first place -- they're impossible to get rid of, because whoever suggests getting rid of them will become a scapegoat for failures that existed in the plan as originally implemented.
Post by: jeepmor on September 21, 2007, 05:06:41 AM
To quote from Riley's link....
Quote
In the final analysis, Congressional pension benefits are 2-3 times more generous than what a similarly-salaried executive could expect to receive upon retiring from the private sector. That ought to be enough to concern any taxpayer
Post by: Silver Bullet on September 21, 2007, 06:06:31 AM
Members of congress pay Social Security.
You're right. They started in 1983
http://www.ntu.org/main/page.php?PageID=21
Post by: jnojr on September 21, 2007, 11:40:20 AM
I don't understand why the government doesn't simply implement private savings plans and fund the difference out of other income until all the current SS obligations are out of the system.
See my response above.
Post by: CAnnoneer on September 21, 2007, 08:11:57 PM
In any case, the problem is not lack of solutions, it is lack of political will to pursue them aggressively, consistently, and responsibly. Politicians are not held accountable by the public, and so, they do nothing. They are lazy, self-serving employees of an apathetic and collectively incompetent boss, the taxpayer. Or at least that's the theory.
The impending SocSec crisis is ultimately just one of the symptoms of a regrettably failing political system.
Post by: Monkeyleg on September 21, 2007, 08:30:54 PM
Just which politician would you suggest come up with an alternative fuel source? I can't think of anyone serving in congress who has the knowledge to do that.
Of course, there's people in the private sector who can do that, just as there were people in the private sector who made personal computers and internet access responsible for the economic boom of the 1990's. Al Gore notwithstanding, of course.
But these people, and the companies they work for, are constrained by current knowledge of physics, as well as government mandates that they produce Ford Expeditions that get the same fuel economy as GEO Metro's by 20XX.
Do you or anyone else believe that, if a corporation found a way to make cars that ran on alternative energy sources, and which would be appealing to the public, that said corporations wouldn't be pushing them like crazy? The market would be huge.
Correct me if I'm wrong about your post, but you seem to be suggesting that government mandate the advancement of technology, even where such technology does not exist.
Post by: CAnnoneer on September 21, 2007, 09:21:00 PM
The reason why I believe in gov support for fundamental research is because the private sector, with the notable exception of pharmaceutal companies, does not do nearly as much fundamental research as they used to several decades ago. Much more is driven by the bottom line and long-term projects are proportionately less funded than before. I do believe in the force of the free market, but certain technological accomplishments are just too financially intensive and time-consuming to be done by the private sector anymore. Not that they cannot afford it; it is a question of leadership, culture, and timescale expectations.
To convince yourself in that, consider how long it would have taken for the Manhattan Project to be financed and organized by private capital, on the lure of nuclear power for domestic and industrial use, for example. Yes, the gov had thousands of private subcontractors to do a lot of the supply, building, and engineering, but it provided the framework, organization, and most importantly the financial backing and the hard push for it.
From this perspective, controlled productive fusion or a comprehensive list of lesser developments is essentially accessible within the necessary timeframe by a level of commitment that only fedgov can match. All I am saying is it can; whether it would is a different question. Also, there are internal and external interests that fight tooth and nail against it.
Fedgov does not mandate technological advancements or the laws of physics, but it can provide financing, organization, and long-term commitment. Of course, there are no Germans to compete with, so political will is far more difficult to muster and sustain. That is why I am not optimistic for the future of this nation and the world.
Post by: Monkeyleg on September 21, 2007, 10:02:01 PM
If we were at war with Toyota, and facing tens of thousands of US casualties by invading Toyota plants in Japan, that might be an apt analogy.
Whatever your opinions of the bombings of Hiroshima and Nagasacki, the Manhatten project was driven by the need to get The Bomb before our enemies--most particularly Germany--did. And to eliminate the need for a land invasion of Japan, and also to let the Russians know that we had The Bomb.
There isn't such a live-or-die imperative right now regarding new energy technology.
Toyota and Honda are several years ahead of US automakers in the manufacture of hybrid cars. One reason is that the US automakers are strapped for cash because of pensions and other benefits to retired as well as currently-employed workers. Another reason is that consumers simply aren't demanding hybrid cars (except for those who take pride in driving hybrid cars). Lastly, we haven't reached the point where consumers realize a crisis in front of their faces, much as gun owners don't realize the crisis they face until it's too late.
It's not as though we're going to run out of oil as soon as some would say. I read today that Russia was exploring an area of the continental shelf off the country's shores to see if the shelf fell within territorial waters. It's estimated that the oil in that shelf could constitute as much as 25% of the world's supply.
Don't underestimate the ability of the private sector to see a solution to a problem, develop it, and have it ready for market. I'd much rather rely on the private sector than on blowhards in congress.
Post by: CAnnoneer on September 21, 2007, 10:22:35 PM
I agree we are not at war with Toyota. And that is one of my points precisely. There is no real sense of urgency whatsoever. No external pressure to turn the wheels of statesmanship. That lack makes the situation worse, not better. That the president would talk about switchgrass instead of a comprehensive long-term energy policy with the urgency, backing, and attention of the Manhattan Project, is symptomatic to the problem.
The new corporate culture is one of very-short-term save-ass cash-and-run Enronist leadership. It is not the kind of environment that fosters long-term solutions. Also, a lot of the entrepreneureal element is limited to small startups on venture capital, where a 5x return is expected in 2 years, or the plug is pulled. At best, such companies can make incremental improvements in mostly established tech, rather than something fundamentally new that takes a long time to work out. By the comprehensive nature of the problem, comprehesive solutions are required. Producing them through incrementalism will take many years, more than we have.
Finally, market pressures will not be sustained over long enough for companies like that to truly succeed. Was it the Carter administration that spent a lot of money on alternative energy and just when the respective companies were getting somewhere, the OPEC killed them by dropping the price of crude oil.
Post by: tyme on September 22, 2007, 12:59:49 PM
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The reason why I believe in gov support for fundamental research is because the private sector, with the notable exception of pharmaceutal companies, does not do nearly as much fundamental research as they used to several decades ago.
Why are the research labs drying up or shrinking? Are people with expertise to make real advances in modern technology more expensive to hire? Were some of the famed research labs like Xerox PARC getting indirect funding from defense contracts during the cold war? Are companies so mired in regulation that running research is seen as too speculative and damaging to the bottom line? Do corporate leaders simply not have vision? Do they not have the necessary management expertise to get useful technologies out of research programs?
Post by: CAnnoneer on September 22, 2007, 02:54:33 PM
As far as high tech products go, we live in a very different world than 1950-1970s. The best example is China. They are still not capable of producing particularly high quality products for the most part, but they now have enough knowledge and infrastructure to produce knockoff products that can compete in many markets. Previously they simply could not, so patent protection was not a big issue. Now they can, but there is no patent protection because they blatantly ignore it.
If you are an American company, it might not be financially prudent to invest millions of dollars in developing new products, because the Chinese would produce a cheap knockoff and undercut your market the minute you try to cash in on your investment. Why then would you invest in it as you did before? The answer is you cannot do so as profitably as before. This is true in most branches of manufacturing, perhaps with the single notable exception of medical pharmaceuticals. The Chinese do not yet have the chemical and biochemical industry to do that yet, but one day they probably will.
There are other things that affect the bottom line, which indirectly reduce the financial surpluses that did and would have gone to R&D. Probably the most obvious one is different forms of litigation. Money that would have gone to research instead goes into the pockets of lawyers that sue you or lawyers you hire to protect you from the former.
The list really goes on and on. Our society is SYSTEMICALLY sick. Different maladies have combined to reinforce one another. We need very drastic reforms to survive, but there is no political will to do so. The goons in congress are mostly lawyers. There are maybe 4 PhD's and about 20 MDs among them. The rest is a few economists and the crushing majority are lawyers. Would you believe that somebody like John Edwards would move a finger against litigators if he becomes POTUS ?? Will Hillary slash benefits and start private accounts?? The people that make these decisions are some of the worst parts of the problem in the first place. They will not bet against themselves.
Finally, it is not true that science and technology types are more expensive to hire. If you compare average salaries to those in the 1950s, the pay is less now than it was if you adjust for buying power. If there is an increased expense, it is the amount you need to spend to support the person with equipment and chemicals and consumables once you hire him. Depending on the specialty, it can cost in excess of 300k to support an engineer that you hired for 100k, just as it costs you at least 50k annually to support a gradstudent whom you pay 25k. It has to do with the advanced technologies needed as well as space, services, etc. that have to be provided.