There are Liars and There are Those Who Use Statistics

guydewhitney heretics crusade defending western civilization from world hunger and military spending

I came across this wonderful bit of distortion on Google+ today trying to blame world hunger on US politicians…

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Tonja Kilby  –  9:46 AM  –  Limited
This makes me SICK
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John Newmark – If this makes you sick, consider this.  The figures come from 2008.
http://www.fao.org/newsroom/en/news/2008/1000853/index.htmlCurrent World Military Spending is 35 times higher than in 2007.  So what took 8 days back then…
http://www.globalsecurity.org/military/world/spending.htm

10:15 AM   

 Here is my little contribution of reality… I actually LOOKED AT THE DATA! Yes, Virginia, I know that they consider that cheating in the partisan world but, who cares?
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Guy DeWhitney – Tell it to the ones escalating.
Here is some analysis from that bunch of data.MIL SPENDING – PERCENTAGE OF GDP
Korea, North 25.00%
Saudi Arabia 10.00%
Jordan 8.60%
Yemen 6.60%
Syria 5.90%
Turkey 5.30%
United States 5.25%MIL SPENDING – INCREASES SINCE 2005:
China $53,357,142,857
United States $39,400,000,000
India $10,428,571,429
Saudi Arabia $6,848,333,333
Turkey $4,304,337,500
Indonesia $3,929,428,571
Iran $2,043,437,500
Korea, South $1,959,250,000
Colombia $1,725,833,333
United Kingdom $1,358,666,667
Germany $890,625,000

And the scary one – PERCENTAGE of increase since 2005:
China 5846%
Indonesia 2216%
Syria 693%
Cuba 607%
India 484%
Iran 480%
Chad 442%
Belarus 401%
Colombia 396%
Yemen 386%
Turkey 382%
Saudi Arabia 328%
Bangladesh 313%
Lebanon 309%
United Arab Emirates 220%
Korea, North 200%
Jordan 198%
Korea, South 174%
Chile 168%
Israel 161%
Germany 120%
United Kingdom 119%
United States 119%
Egypt 112%

Economics 001 a Remedial Course for Modern Monetary Morons

Economics is more than just money

Today there seem to be few people, let alone economists, who actually seem to grasp the basic  ideas of monetary theory upon which they build their roads to whatever fantasy land their prejudices predispose them to believe in. Economists pronounce, politicians spout and pundits pund but, how many of them really grasp, and apply, a basic understanding of what money is; how many have a clue how far everyone has strayed from reality?

Come Virginia, let us begin at the beginning; what is the difference between coinage historically (which is not like coinage in the modern world) and paper “monies“, and just what money really is.

I will be analyzing monetary theory without being bound by any politically oriented school of “economics“, instead I will attempt to put money in the same light that Newton put moving objects; money follows laws that do not respect any political need or opinion and I hope to merely describe what it is and what it is not irrespective of what anyone wants it to be.

Let’s start with coinage, a concept that still holds its place at the head of the parade despite vanishing as a concept by the 1970’s.

Historically, coins were what people now mostly think “money” should be, a portable piece of actual wealth, something “worth” just what its face declares. Don’t forget though that all value is relative, if no-one wants gold, it is “worth” little, if they crave it, it is worth a lot.
Cash monies on the gold standard promised payment in hard coin with value of its own.

At first glance this seems a good system, though it does carry hidden “costs.” If the gold or silver or copper in a coin is “worth” exactly its face value the person or group who minted that coin will lose the amount of “value” (manpower and resources) represented by the minting of the coin from bullion.  No matter how cheaply a chunk of bullion quality metal is turned into coinage that amount of value will be lost to the minter if they receive the “face” value in goods or services in return for their shiny, new coins.

This does not change with banknotes; printing costs plus the cost of the raw materials simply replaces the minting costs; remember, the raw material of a coin is the value of the coin.

For a long time banknotes represented actual bullion in a vault, or somewhere in the control of the issuer of the note, while coins represented actual wealth themselves. But, the ability of coiners to debase the metals they used producing coins “worth” less than their face value, and the fact that not all promissory notes represented an honest promise of actual coinage made the system far from perfect.

Enter “fiat” money. Bitterly fought, this is what “money” is supposed to be, though the transition is far from over globally and nationally.

A “currency” based on the exchange of gold and silver etc. is not in fact a real monetary system, it is barely one step up from barter. In barter or specie based economies not only must a person, or society, have the wealth and productivity to fill their own basic needs, they need to accumulate extra goods (coinage) simply to be able to participate in the system that provides those basic needs and services. Then they must accumulate even more if they wish to enjoy a level of “comfort” far below what is consonant with their current efforts to add productivity and wealth to their communities.

Barter ecomonies belong to an uncivilized past. Coinage was a simple, brute force answer to the problem of trusting someone when you have no way of enforcing that trust. Cash on the barrelhead as they said. Hopefully we have grown a bit beyond that, at least in the Western (civilized, modern) world.

Here is the bombshell Virginia, it is so simple that the “intelligentsia” just can’t get it: In a civilized society the function of money is to serve as counters in the games of economics, nothing more, nothing less. Money is not a commodity as it has no value of its own. Money is supposed to represent the wealth and productivity of the issuer only, not to be “worth” anything at all on its own!

Ideally, if a government wanted a bridge built and had the spare raw materials and manpower to build it, all the gov needs to do is print the right amount of money, and pay for a new road.

They do not make anything appear by doing so, they do not cause “inflation”, they just tossed counters in the game that were needed to let the players turn raw materials and idle bodies into a bridge thus creating wealth, not diminishing it! Or not creating as such, but acknowledging, since keeping the money level in balance with the national productivity is the whole goal.

Ideally, within a nation, it should be practical to pay each citizen with new, non-inflated money in tune with any growth in GDP, just like dividends to stockholders in a corporation. Infrastructure improvements (bridges, roads, universities and research facilities, etc.) would only be “unaffordable” if they used so many resources or manpower that they caused a significant rise in prices and wages in the private sector; wouldn’t that be so terrible, we couldn’t build a road one year because there was no unemployment and people were selling what they made as fast as they could make it!

Practically, especially with the current rats nest of insanity that we call economics worldwide, that kind of system would be almost impossible to implement; more the shame on us for letting things get so messed up.

Simply put, we should not be borrowing the money the government has the sole right to print/mint and regulate!!! The amount of dollars in circulation is supposed to be enough, theoretically, to buy all the goods and services produced this year, instead we treat money as though it is coinage and create a pre-broken system that invites inflation, deflation and puts everyone at the mercy of molehill booms and mountains busts.

Marx was an overeducated fool


(HH: This wonderful analysis of the prime flaw of socialism and communism is anonymous from the internet.)
An economics professor at Texas Tech said he had never failed a single student before but had, once, failed an entire class.

This particular class had insisted that socialism really worked: no one would be poor and no one would be rich, everything would be equal and ‘fair’. The professor then said “Okay, we will have an experiment in this class on socialism. Instead of money, we’ll use your grades.”

All grades were to be averaged and thus would be “fair”. This meant that everyone would receive the same grade, which meant that no one would fail. It also meant, of course, that no one would receive an A…
– – – – – – – – –
After the first test the grades were averaged and everyone got a B. The students who had studied hard were upset, but the students who had goofed off were quite happy with the outcome.

As the second test rolled around, the slackers studied even less now – they knew they’d get a good grade anyhow. Those who’d studied hard in the beginning now decided they wanted a free ride too. Thus, going against their own inclinations, they copied the slackers’ habits. As a result, the second test average was a D.

No one was happy.

By the time the third test had been graded, the average was an F.

The scores never increased but bickering, blame, and name calling began to be the environment in which this class operated. It had been their own quest for “fairness” which had led to this unintended result of hard feelings and grievances. In the end, no one was willing to study just for the benefit of everyone else. Therefore, all the students failed…to their great surprise.

The professor explained that their experiment with socialism failed because it was based on the least effort by all. Laziness and resentment were the outcome. There would always be failure in the situation they’d agreed to in the beginning.

“When the reward is great”, he said, “the effort to succeed is great, at least for some. But when government takes all the reward away by taking from some without their consent and giving to others without their effort, then failure is inevitable”.