Welfare-Warfare State

Welfare Recipients Can Now Earn More Than Teachers

"A mother with two children in New York, for instance, is able to collect $38,004 per year in welfare handouts. This is greater than the starting salary of a teacher in the state. In 33 states, welfare recipients make more than they would at an $8 per hour job. In fact, in 12 of those states, welfare recipients make more than they would at a $12 per hour job. Where is the incentive to work? Michael Tanner, a senior fellow at CATO, said, 'There is no evidence that people on welfare are lazy. But they’re also not stupid. If you pay them more not to work than they can earn by working, many will choose not to work.'" Continue reading →

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Bill Bonner: The world’s fattest army

"Yes, dear reader, times have changed. But humans have not. Give them the opportunity, and they will turn into zombies. The late Colonel John Boyd of the US Air Force, observed that, 'It is not true the Pentagon has no strategy. It has a strategy, and once you understand what that strategy is, everything the Pentagon does makes sense. The strategy is, don’t interrupt the money flow, add to it.' Boyd was a strategist. He observed that wars were won by lean and agile fighters, who were able to improvise and innovate quickly as needs and opportunities arose. Bureaucracy does not support such warriors; it tries to get rid of them." Continue reading →

Continue ReadingBill Bonner: The world’s fattest army

Texas begins replacing paved roads with gravel due to lack of funding

"The Texas Department of Transportation began converting more than 80 miles of paved roads to gravel on Monday, according to the Texas Tribune. The speed limit on the new gravel roads will be reduced to 30 mph. Texas lawmakers approved $225 million for the repair of roadways and bridges within the state highway system this year. Texas lawmakers also approved a ballot measure that would provide $1.2 billion a year for state transportation projects. But the Texas Department of Transportation said $400 million was needed to repair immediate damage caused by energy sector traffic across the state." Continue reading →

Continue ReadingTexas begins replacing paved roads with gravel due to lack of funding

US International Capital Flows

"The US Treasury released data last Thursday tracking international capital flows for the US through June. The outflows out of US securities was shocking. Especially troubling was the amount of US Treasuries sold by foreigners. Their outflows exceeded those from US bond funds. The data suggest that foreign investors may have been more spooked by the Fed’s tapering talk in May and June than domestic investors. As the US federal deficits have swelled, the US government has become more dependent on the kindness of strangers. Apparently, they are losing their interest in helping us out with our debts." Continue reading →

Continue ReadingUS International Capital Flows

US International Capital Flows

"The US Treasury released data last Thursday tracking international capital flows for the US through June. The outflows out of US securities was shocking. Especially troubling was the amount of US Treasuries sold by foreigners. Their outflows exceeded those from US bond funds. The data suggest that foreign investors may have been more spooked by the Fed’s tapering talk in May and June than domestic investors. As the US federal deficits have swelled, the US government has become more dependent on the kindness of strangers. Apparently, they are losing their interest in helping us out with our debts." Continue reading →

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Decline and Fall: The Second Stage is Anger

"Not too long ago, I predicted that if I live to the average American male lifespan of 76 — I’m 46 now — I’ll have outlived the United States as we know it. At the time, I feared I was being over-optimistic, but lately I’m leaning the other way and thinking that my timetable may have been unduly timid. The recent temper tantrums of the American political class and its toadies abroad bring to mind an old saying (incorrectly attributed to Gandhi) — 'first they ignore you, then they laugh at you, then they fight you, then you win' — and the Kubler-Ross model of grief. Our would-be masters appear to have moved forward from 'denial' to 'anger' in a big way." Continue reading →

Continue ReadingDecline and Fall: The Second Stage is Anger

The New Deal Origins of Fannie Mae and the Government-Housing Complex

"Fannie Mae is a classic crony capitalist progeny of the New Deal that began life in 1938, quite innocently, as still another ad hoc New Deal program to boost the depression-weakened housing market. It grew into something quite different: a monster that deeply deformed and corrupted the nation’s entire financial system seventy years later. The policy aim of Fannie Mae was 'forcing water to flow uphill' in the residential mortgage market so that low-rate thirty-year home mortgages became available to wage-earning households of modest means. Such mortgages did not then exist for a good reason: they were not economic." Continue reading →

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“Government Laboratory” for “Unlimited Taxpayer Risk” Now Slated for Demolition

"House Financial Services Committee Chairman Jeb Hensarling (R-TX) has described Fannie and Freddie as the product of a ‘government laboratory’ and one that exposes taxpayers to ‘unlimited risk.' Hensarling and others in the House are working on legislation to end the companies for good. Now that the president is on board, with apparent bipartisan support, it seems that reality may not be far off. Investors appear to be speculating on news the feds may actually pay off debt to taxpayers and recapitalize. Since liquidation appears to have broad support in the government, Fannie and Freddie look like stock to steer clear of." Continue reading →

Continue Reading“Government Laboratory” for “Unlimited Taxpayer Risk” Now Slated for Demolition

Watchdog: Fannie, Freddie should be required to recognize bad mortgages ‘immediately’

"Fannie Mae and Freddie Mac are masking billions of dollars losses because of the level of delinquent home loans they carry, a federal watchdog said, and it said the companies should be required immediately to recognize the costs of some bad mortgages. Fannie Mae and Freddie Mac were seized by the U.S. government in September 2008 as rising mortgage losses threatened them with insolvency. The mortgage companies have cost taxpayers almost $188 billion to stay afloat. Fannie and Freddie have reduced their funds reserved to cover potential losses on bad loans due to the strengthening housing sector and higher home prices." Continue reading →

Continue ReadingWatchdog: Fannie, Freddie should be required to recognize bad mortgages ‘immediately’

This failure rate will shock you

"There’s always a new elite showering themselves with unchecked dictatorial powers– from control of the money supply to control of the military. For example, four men control over 70% of the world’s money supply in our modern central banking system. They have the power to conjure unlimited quantities of currency out of thin air in their sole discretion. Meanwhile, the 'richest' countries in the world (US, Europe, Japan, etc.) are so deeply in debt that they have to borrow money just to pay interest on the money they’ve already borrowed. This isn’t rocket science. Predicting the end of this system is not attention-seeking sensationalism; it’s just common sense." Continue reading →

Continue ReadingThis failure rate will shock you