tag:blogger.com,1999:blog-3360697570873499457.post3911458340914772344..comments2023-10-26T06:32:56.972-07:00Comments on Lost in America: "Government Union Reform Overdue"A Modest Scriblerhttp://www.blogger.com/profile/07698092153994590787noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-3360697570873499457.post-54127825199113422652011-03-01T11:15:06.632-07:002011-03-01T11:15:06.632-07:00We need a Constitutional Amendment that mandates a...We need a Constitutional Amendment that mandates all government revenue to be a FIXED percentage of the annual GDP. It should further specify that government expenses (City/County/State/Federal) shall be no more than 90% of revenue with the remaining 10% being equally divided between paying down the national debt and a "rainy day" emergency fund.<br /><br />Plain, simple, logical common-sense. The politicians would be horrified but the hard-working, honest and ethical American public would go for it in a heartbeat.<br /><br />Politicians seem to think that taxation is a bottomless well that they can draw from ad infinitum. We have to remember that liquidity is the life-blood of the economy. Take too much money out of circulation, no matter where it is drawn, and the economy will die.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-3360697570873499457.post-52224136388559791602011-02-26T05:58:46.316-07:002011-02-26T05:58:46.316-07:00The classic example of embedded inflation is the w...The classic example of embedded inflation is the wage-price spiral — better described as wage-price leapfrogging — of the 1970's. Back then, whenever wage contracts came up for renewal, workers demanded big raises, both to catch up with past inflation and to offset expected future inflation. And whenever companies changed their prices, they raised them by a lot, both to catch up with past wage increases and to offset expected future increases. <br /><br />The result of this leapfrogging process was that inflation became a self-sustaining process, feeding on itself. And ending that self-sustaining process proved very difficult. The Fed eventually brought the inflation of the 1970's under control, but only by raising interest rates so high that in the early 1980's the U.S. economy suffered its worst slump since the Great Depression<br />(This was actually written by a LIBERAL economist, the NY Times' Paul Krugman.)A Modest Scriblerhttps://www.blogger.com/profile/07698092153994590787noreply@blogger.com