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How the world works(?)

Discussions about the economic and financial ramifications of PEAK OIL

Re: How the world works(?)

Unread postby MacG » Sun 23 Oct 2005, 14:03:22

$this->bbcode_second_pass_quote('ElijahJones', 'I')s what I have said true? If so how can we change it?


Probably very true. At least as I percieve it.

What to do? Well, I happen to belive that it's a set of personality disorders which drive the people at the top of the ant heap, and it is the next big step forward in human development to learn to identify those persons and stop empowering them.

They have a crime-pattern of approaching the most stupid and gullible part of the population for support (that half of the people "you can fool all the time"), and promise various forms of "redistribution" of the wealth of others to the stupid. Well, pretty succesful script this far...
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Re: How the world works(?)

Unread postby Peak_Modernity » Sun 23 Oct 2005, 14:11:27

In my estimation, the "haves" today are only different than in the past in that they are better at fooling the "have nots". I see everything as an illusion (the economy, freedom etc.), however we like to be fooled if it means a few moments of pleasure.

"How can we change it?"

I believe that it will take a tremendous collapse to end the extent of corruption and inequality, but it will still exist in some form. I feel this is the reason that so many people are doomers, they know that something is fatally wrong with the system, but are powerless to change it. Collapse is their only hope. To some extent, a collapse would be a blessing. It will be extremely hard for many to adjust to, but given enough time people will realize that the quality of life is better than our current consumer madness.
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Re: How the world works(?)

Unread postby aldente » Sun 23 Oct 2005, 16:24:05

$this->bbcode_second_pass_quote('Peak_Modernity', ' ') It will be extremely hard for many to adjust to,

What about it will be impossible for most to adjust to. Or how would you adjust if you still owed $400.000 on your home and then loose your job due to some of the side effects of Peak Oil? Once you have locked yourself successfully into the system there is no way out - hence the denial of PeakOil as your only option.
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Re: How the world works(?)

Unread postby Peak_Modernity » Sun 23 Oct 2005, 19:18:32

$this->bbcode_second_pass_quote('albente', '')$this->bbcode_second_pass_quote('Peak_Modernity', ' ') It will be extremely hard for many to adjust to,

What about it will be impossible for most to adjust to. Or how would you adjust if you still owed $400.000 on your home and then loose your job due to some of the side effects of Peak Oil? Once you have locked yourself successfully into the system there is no way out - hence the denial of PeakOil as your only option.


These same people are taking a huge risk regardless of Peak Oil. Financial discipline is a foreign concept to many people. Personally I don't buy much if I don't have the cash to pay for it almost immediately. This means I don't get to partake in the feeding frenzy that is consumerism, but I don't feel like I am missing out on anything. Anyone willfully stretching their finances to the max is asking for trouble, Peak Oil just threatens to call their bluff sooner rather than later.
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Re: How the world works(?)

Unread postby MrBill » Tue 25 Oct 2005, 05:14:58

US Census Data 2004

Elijah, it sounds like you have been thinking about some important issues, but I cannot agree with some of your conclusions. You seem to suggest that because the world is not equal that it is unfair, and because the world is not fair it can be somehow changed to make it fair?

You recommend dismantling a system that has lifted millions of working poor out of the coal mines of Pennsylvania and given them a living wage. You liken having to work for a living to being a wage slave. Well, yes it is a fact of life that unless you're born rich & beautiful that you might have to work for your daily bread. I don't think that has changed much since the beginning of time. Get used to it.

You mention Bill Gates? A brilliant entrepreneur that changed the way we live, work & play. Warren Buffet? A man who knows how to spot value where others cannot see it. Both are success stories. But, why do you choose to compare the average worker with a median family income of $44.389 to the super rich and successful and not instead to those who live in extreme poverty elsewhere in the developing world? I would suggest that the first $40.000 buys a great deal less pain & suffering than any amount of money above $45.000. I call it the law of diminishing returns.

12.7% of Americans live in poverty and 15.7% of Americans have no healthcare, but they still live better in absolute terms than those Pennsylvanian coal miners did in the 1870's or better than the Oakies that picked fruit & vegetables for less than a living wage with no security. Poverty is defined as less than $19.300 median income for a family of four. Not a lot, but yet you advocate dismantling a system where even the poor do not starve, even if they have to rely on food banks and food stamps for what? No system? It is fine to have a hypothesis that says, this sucks! It is quite a different to make concrete proposals that may solve some of the problems you see with the existing system.

Although 15.7% of Americans have no healthcare they only paid approximately 15% of their own healthcare costs $26 billion. The rest nearly $171 billion was picked-up by the government, hospitals and private & public payers. That may not be perfect or ideal, but it is still a safety net and a huge subsidy despite programs exist like COBRA & Medicaid for the unemployed and the poor, so in many cases the choice not to have healthcare is a conscious choice. Healthy people may have other priorities than health insurance and once they get sick they may find themselves uninsurable. I have great sympathy for the working poor who are trying to make ends meet. However, food, shelter, heat & healthcare have to be basic expenditures before anything including Nikes, DVDs, cigarettes, booze and other consumerables.

We live in an age where the average family earning $44.389 per year spends just 10% on food and another 10% on energy. Not huge amounts. Housing should never consume more than 30% of net earnings. Owning a $400.000 home and an SUV are not rights confered from above. If you cannot afford them, you have to forgo consumption until you have saved enough to buy them. Anyone that starts borrowing to spend or spends before they can afford to is saving up trouble for the future. However, that is an individual responsibility. No government or corporation makes the masses spend themselves deeper into debt.

You say the powerful always rule over the weak? I am not sure that is an insight or just stating the obvious. The educated will always rule over the uneducated. The rich will always have more than the poor. Those that work hard will usually have more than those who will not or cannot work. What is your point? Are you disappointed that your career has not worked-out? That others have not recognized your potential? That others have been more successful? That others have larger houses or better autos? I think that most families who earn $44.389 have enough disposable income after basic needs to finance a nice quality of life. They do not have to consume, consume, consume. They can afford to anything they like, but they cannot afford to do everything they want. Pretty lucky place to be really.

It seems you have the luxury of being able to whine about the system while at the sametime sitting at your computer. You could add another obvious truism. Those that have computers will always blog more than those with no computers. Should we wage the class war of the digital divide next? :)
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Re: How the world works(?)

Unread postby pup55 » Tue 25 Oct 2005, 09:24:02

$this->bbcode_second_pass_quote('', 'd')ismantling a system


When the situation is dysfunctional enough, it will change discontinuously. There are plenty of examples of this in history (Madame Lafarge, Chairman Mao, Evita Peron). Even in the US there are periods of discontinuous transition, and it usually happens with the emergence of a leader (Jefferson Davis, John L. Lewis, ML King)

$this->bbcode_second_pass_quote('', '1')2.7% of Americans live in poverty and 15.7% of Americans have no healthcare, but they still live better in absolute terms


This is correct. 95% of the people below the poverty line own microwave ovens. At some point, when the "social safety net" breaks down, and there are masses out in the streets, sufficient critical mass will be present for discontinous change. I frankly cannot figure out why the nation's urban poor have not already burned down our major cities in protest over lack of economic opportunity except to say that they are currently so doped up with illicit drugs that they do not have the ambition. Also, the leaders in this community have been notoriously weak and corrupt.

The real problem is that the bottom 60% of the nation's wage earners have experienced a net drop in real income since 1980. Despite this, they continue to vote on cultural issues rather than in their economic interest. This is because conditions are (were) still good enough that they are (were) willing to stick with the system as it was. One of these days, TS will HTF and some of these people will become ticked off enough that there will be another period of discontinuous change. The emergence of a leader will also make this change happen.
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Re: How the world works(?)

Unread postby MrBill » Tue 25 Oct 2005, 09:31:03

$this->bbcode_second_pass_quote('', 'T')he real problem is that the bottom 60% of the nation's wage earners have experienced a net drop in real income since 1980. Despite this, they continue to vote on cultural issues rather than in their economic interest. This is because conditions are (were) still good enough that they are (were) willing to stick with the system as it was. One of these days, TS will HTF and some of these people will become ticked off enough that there will be another period of discontinuous change. The emergence of a leader will also make this change happen.


I doubt it. They can burn down the buildings, but they have no ideas on which to build a new system. They are as morally bankrupt as they are poor. Who will lead them? Jesse Jackson? Oprah? Revolutions come from rigerous thought and new ideas that find an audience. Who will be their Arthur Seldon? They are too lazy to read much less soak up new ideas about civil government. The future will look like the past and the buildings will be re-built.
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Re: How the world works(?)

Unread postby pup55 » Tue 25 Oct 2005, 13:29:42

$this->bbcode_second_pass_quote('', 'W')ho will lead them? Jesse Jackson? Oprah?


Nope.

$this->bbcode_second_pass_quote('', 'T')hey are as morally bankrupt as they are poor


Correct again.

$this->bbcode_second_pass_quote('', 'W')ho will be their Arthur Seldon?


This is the question of the day. The discontinous change awaits a leader.
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Re: How the world works(?)

Unread postby Eli » Tue 25 Oct 2005, 13:45:40

There is one thing that rules this world and it is money.

Money brings freedom and power with enough money you can do anything you want.

I do not think there is a human system that can defeat the influence and injustices that come from a society based on the desire to have more and more money. And that includes communism having dacha outside Moscow, is the same as having money.
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Re: How the world works(?)

Unread postby donshan » Tue 25 Oct 2005, 15:35:27

$this->bbcode_second_pass_quote('Eli', 'T')here is one thing that rules this world and it is money.

Money brings freedom and power with enough money you can do anything you want.

I do not think there is a human system that can defeat the influence and injustices that come from a society based on the desire to have more and more money. And that includes communism having dacha outside Moscow, is the same as having money.


True, but it has always been that way.

"The rich rule over the poor, and the borrower is servant to the lender"-Proverbs 22:7

Probably an ancient oral tradition, written down 3000 or more years ago.

Times have always been tough for most of mankind. It is just that our personal experience is a but brief flash of history.


American's don't know what "tough" times are, and we tend to forget that the "good old days" were not so good.

In 1900 the average housewife spent 8.5 hours a day just cooking. And women dying in childbirth was an all too common outcome.


WWII was a tough time! This same discussion was the subject of many books during the hyper-inflation of the 1970s, and gold was the answer then.

Mankind has has always searched for political solutions to this problem. Winston Churchill summed it up best for me.

"Many forms of Government have been tried, and will be tried in this world of sin and woe. No one pretends that democracy is perfect or all-wise. Indeed, it has been said that democracy is the worst form of Government except all those others that have been tried from time to time."
Winston Churchill
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Re: How the world works(?)

Unread postby MrBill » Tue 01 Nov 2005, 10:31:24

$this->bbcode_second_pass_quote('donshan', '')$this->bbcode_second_pass_quote('Eli', 'T')here is one thing that rules this world and it is money.

Money brings freedom and power with enough money you can do anything you want.

I do not think there is a human system that can defeat the influence and injustices that come from a society based on the desire to have more and more money. And that includes communism having dacha outside Moscow, is the same as having money.


True, but it has always been that way.

"The rich rule over the poor, and the borrower is servant to the lender"-Proverbs 22:7

Probably an ancient oral tradition, written down 3000 or more years ago.

Times have always been tough for most of mankind. It is just that our personal experience is a but brief flash of history.


American's don't know what "tough" times are, and we tend to forget that the "good old days" were not so good.

In 1900 the average housewife spent 8.5 hours a day just cooking. And women dying in childbirth was an all too common outcome.


WWII was a tough time! This same discussion was the subject of many books during the hyper-inflation of the 1970s, and gold was the answer then.

Mankind has has always searched for political solutions to this problem. Winston Churchill summed it up best for me.

"Many forms of Government have been tried, and will be tried in this world of sin and woe. No one pretends that democracy is perfect or all-wise. Indeed, it has been said that democracy is the worst form of Government except all those others that have been tried from time to time."
Winston Churchill



From where I am sitting on this debate it seems to me that we have some sort of bipolar distribution in attitudes. On one hand we have those that have not done well out of this system, are understandably upset, and therefore would like nothing better but a flood to wash away the entire system.

On the otherside are the two income families, the guys putting in 60 work weeks, commuting long distances, working weekends, the road warriors. I think it would be unfair to say that they are not willing to do what needs to be done to be successful at least in their chosen fields. There does not seem to be much in between?

I will agree that most people do not know what tough times are. These are not tough times. They can be a lot worse. My feeling is that if the system goes through a serious period of correction that those who are successful now under this system will be those that are successful under any other system that replaces it. Exceptions no doubt, but the workers and those who know how to make sacrafices for what they want will likely be better off than those waiting for the flood to come?

Not very scientific, but trying to add another dimension to the argument. :)
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Re: How the world works(?)

Unread postby MacG » Tue 01 Nov 2005, 10:53:18

$this->bbcode_second_pass_quote('MrBill', ' ')My feeling is that if the system goes through a serious period of correction that those who are successful now under this system will be those that are successful under any other system that replaces it.


Pretty spot-on! But they will have to resort to completely different strategies in order to be succesful. But it will sort itself out.
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Re: How the world works(?)

Unread postby Doly » Tue 01 Nov 2005, 10:54:10

$this->bbcode_second_pass_quote('MrBill', 'M')y feeling is that if the system goes through a serious period of correction that those who are successful now under this system will be those that are successful under any other system that replaces it.


Explain that to the old Russian aristocracy.

Times of changes are exactly that, times of changes. I can tell that you are doing well right now, Mr Bill. I guess that puts you in a better starting place than others. But I don't think it guarantees anything. Smart people will remain smart, and that always helps. But other skills may become more or less relevant.

On the other hand, it's entirely possible that people who aren't doing very well now do very well if things change. Old forgotten skills, like repairing pans or sharpening knives, may become relevant again.
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Re: How the world works(?)

Unread postby MrBill » Tue 01 Nov 2005, 11:44:30

$this->bbcode_second_pass_quote('Doly', '')$this->bbcode_second_pass_quote('MrBill', 'M')y feeling is that if the system goes through a serious period of correction that those who are successful now under this system will be those that are successful under any other system that replaces it.


Explain that to the old Russian aristocracy.

Times of changes are exactly that, times of changes. I can tell that you are doing well right now, Mr Bill. I guess that puts you in a better starting place than others. But I don't think it guarantees anything. Smart people will remain smart, and that always helps. But other skills may become more or less relevant.

On the other hand, it's entirely possible that people who aren't doing very well now do very well if things change. Old forgotten skills, like repairing pans or sharpening knives, may become relevant again.


I do not disagree with you. By definition if the change is discontinuous then different skills sets will be needed. However, the desire and ability to learn will help some adapt faster than others.

If we speak about Russia there is one major difference between Russian aristocrats in 1918 and Russian communist bosses in 1989. The aristocrats in 1918 were either forced to flee or they were systematically killed or sent into exile in Siberia. This is not that they were unable to adapt or use their skills. They were prevented from doing so.

The difference between them and the former communist bosses is that many of the same men who ran companies under communism acquired wealth & power post-communism by snapping up newly privatized companies for pennies on the dollar. Yes, some did lose their jobs or their lives, but it was not discontinuous change.
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Re: How the world works(?)

Unread postby threadbear » Tue 01 Nov 2005, 11:59:47

$this->bbcode_second_pass_quote('MrBill', '[')url=http://www.census.gov/Press-Release/www/releases/archives/income_wealth/005647.html]US Census Data 2004[/url]

Elijah, it sounds like you have been thinking about some important issues, but I cannot agree with some of your conclusions. You seem to suggest that because the world is not equal that it is unfair, and because the world is not fair it can be somehow changed to make it fair?

You recommend dismantling a system that has lifted millions of working poor out of the coal mines of Pennsylvania and given them a living wage. You liken having to work for a living to being a wage slave. Well, yes it is a fact of life that unless you're born rich & beautiful that you might have to work for your daily bread. I don't think that has changed much since the beginning of time. Get used to it.

You mention Bill Gates? A brilliant entrepreneur that changed the way we live, work & play. Warren Buffet? A man who knows how to spot value where others cannot see it. Both are success stories. But, why do you choose to compare the average worker with a median family income of $44.389 to the super rich and successful and not instead to those who live in extreme poverty elsewhere in the developing world? I would suggest that the first $40.000 buys a great deal less pain & suffering than any amount of money above $45.000. I call it the law of diminishing returns.

12.7% of Americans live in poverty and 15.7% of Americans have no healthcare, but they still live better in absolute terms than those Pennsylvanian coal miners did in the 1870's or better than the Oakies that picked fruit & vegetables for less than a living wage with no security. Poverty is defined as less than $19.300 median income for a family of four. Not a lot, but yet you advocate dismantling a system where even the poor do not starve, even if they have to rely on food banks and food stamps for what? No system? It is fine to have a hypothesis that says, this sucks! It is quite a different to make concrete proposals that may solve some of the problems you see with the existing system.

Although 15.7% of Americans have no healthcare they only paid approximately 15% of their own healthcare costs $26 billion. The rest nearly $171 billion was picked-up by the government, hospitals and private & public payers. That may not be perfect or ideal, but it is still a safety net and a huge subsidy despite programs exist like COBRA & Medicaid for the unemployed and the poor, so in many cases the choice not to have healthcare is a conscious choice. Healthy people may have other priorities than health insurance and once they get sick they may find themselves uninsurable. I have great sympathy for the working poor who are trying to make ends meet. However, food, shelter, heat & healthcare have to be basic expenditures before anything including Nikes, DVDs, cigarettes, booze and other consumerables.

We live in an age where the average family earning $44.389 per year spends just 10% on food and another 10% on energy. Not huge amounts. Housing should never consume more than 30% of net earnings. Owning a $400.000 home and an SUV are not rights confered from above. If you cannot afford them, you have to forgo consumption until you have saved enough to buy them. Anyone that starts borrowing to spend or spends before they can afford to is saving up trouble for the future. However, that is an individual responsibility. No government or corporation makes the masses spend themselves deeper into debt.

You say the powerful always rule over the weak? I am not sure that is an insight or just stating the obvious. The educated will always rule over the uneducated. The rich will always have more than the poor. Those that work hard will usually have more than those who will not or cannot work. What is your point? Are you disappointed that your career has not worked-out? That others have not recognized your potential? That others have been more successful? That others have larger houses or better autos? I think that most families who earn $44.389 have enough disposable income after basic needs to finance a nice quality of life. They do not have to consume, consume, consume. They can afford to anything they like, but they cannot afford to do everything they want. Pretty lucky place to be really.

It seems you have the luxury of being able to whine about the system while at the sametime sitting at your computer. You could add another obvious truism. Those that have computers will always blog more than those with no computers. Should we wage the class war of the digital divide next? :)


He recommends dismantling a system that lifted coal miners out of the mines? It was union wages driven by leftist forces that provided the miner with the funds to educate his children, and get them out of the coal mines. A purely capitalist system would have kept the miner's kids and their kids in the same mine.

The success of the US was based on wedding some of the best of socialism with the vibrancy of capitalism during a window of opportunity created, post war, by international conditions. In truth, what you have now is a form of fascist corporatism and militarization of the economy. It's a joke to refer to it as capitalism, it's so far gone.

Everything Elijah said is correct, particularly about science. Truth is not an issue. Status quo is. Science has always been dependant on political sensitivities and if you dare tread on anyone's toes, look out.
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Re: How the world works(?)

Unread postby CrudeAwakening » Tue 01 Nov 2005, 14:55:44

Part of the problem with 'the system' is the debt-based nature of money, which demands perpetual growth. This has been discussed elsewhere on this forum.
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Re: How the world works(?)

Unread postby MrBill » Wed 02 Nov 2005, 06:30:26

$this->bbcode_second_pass_quote('CrudeAwakening', 'P')art of the problem with 'the system' is the debt-based nature of money, which demands perpetual growth. This has been discussed elsewhere on this forum.


Debt & savings are two sides of the same coin. YOu cannot have one without the other. Taking on debt is sacraficing future consumption for present consumption. Saving is sacraficing present consumption for future consumption. Interest rates intermdiate the time value of money by discounting future values to present values.

Many countries manage to save a significant portion of their GDP, up to 45-50%, by forgoing consumption now and investing in their future. Otherwise borrowing nations would have to save before they could consume. Money itself does not demand perpetual growth. It is a medium of exchange.

So this may have been discussed somewhere else, but the concept is still not quite understood properly by many people. :)
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Re: How the world works(?)

Unread postby seldom_seen » Wed 02 Nov 2005, 07:07:50

$this->bbcode_second_pass_quote('MrBill', 'D')ebt & savings are two sides of the same coin. YOu cannot have one without the other. Taking on debt is sacraficing future consumption for present consumption.

All of your arguments make sense inside of a vacuum. In the real world, nobody takes on debt under the belief that they will consume less in the future. They take on debts in the belief that they will have more money (money = power = energy) in the future to pay off their debt while at the same time increasing consumption. When you take away energy inputs to the system (peak oil) you take away money (or make money less valuable = inflation).

No offense, but much of the theory that you espouse is out of some dated classical economic textbook and is one the reasons we're in such a mess we're in. We don't live in a theoretical world, we live in a real world. There is a finite amount of rocks, trees and plants (and oil!) Classical economic theory is all fine and dandy until you hit the wall.
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