A Plan to Save U.S. Infrastructure That Might Actually Work

[agentsteel53]

I highly doubt the millions of Americans who have PAID INTO social security would be OK with the government just forgiving $3 trillion worth of debt to that fund. I know I wouldn't be.

I have paid into it with the full assumption that I will never see a penny of it.  it's a Ponzi scheme.

[3467]

Social Security has been a huge funder of the rest of the government and you wouldnt want monetize those holdings but I see no reason that the fed couldnt monetize its debt. We are in a crises and I would just turn the printing press on to do somthing useful like build and fix roads.

The NYT Chart is accurate on where the debt came from and who owns it. Foreign ownership is minor . If China doesnt like it they are free to stop selling stuff to us ,taking dollars and buying our bonds. The crisis is our economic stagnation. The debt thing is some beltway lunacy. We mostly owe ourselves and we owe others in dollars and we have a printing press.

[realjd]

Social Security has been a huge funder of the rest of the government and you wouldnt want monetize those holdings but I see no reason that the fed couldnt monetize its debt. We are in a crises and I would just turn the printing press on to do somthing useful like build and fix roads.

The NYT Chart is accurate on where the debt came from and who owns it. Foreign ownership is minor . If China doesnt like it they are free to stop selling stuff to us ,taking dollars and buying our bonds. The crisis is our economic stagnation. The debt thing is some beltway lunacy. We mostly owe ourselves and we owe others in dollars and we have a printing press.

I could go for some hyperinflation right now. It would help pay off my mortgage. Just let me know before the printing presses start so I can go buy an expensive car on a nice long loan.

[Alps]

I could go for high interest rates right now, since I don't carry debt.

[mgk920]

Er? Freight tracks are maintained well; it's construction of imporvements that may need public funds. As for passenger rail, I'm talking about the NEC as well as city transit systems; most other intercity lines are owned by freight companies.

They need a lot of untangling, hence the CREATE project here in Chicagoland.  Currently, it takes a freight train 2 days to cross Chicago.  The CREATE project will cut that to mere hours.

I would love to see a way found to convert the railroad network in North America to 'open access', much like how all of the other transport infrastructure modes operate, where anyone can go anywhere, provided that their operating personnel are properly qualified, the equipment meets minimum technical standards and they are willing and able to pay the necessary fees and tolls.  If tax money is going to go into upgrades of rail lines (freight and passenger), then anyone should be able to use them.

Mike

[Brandon]

Unfortunately, Mike, the Feds have been extremely slow to release the tax money for CREATE, so the railroads have gone and done it themselves, with their own money (one, CN, bought out a local short line, EJE, to make its own bypass).  I get the feeling the Feds would rather spend on the "high-speed" passenger rail boondoggle than invest in what rail in North America does best - move freight.   I'd love o see this passenger rail money be spent on improving Metra rather than a "high-speed" line between Chicago and St Louis.  Who the heck is going to use such a line?  Outside the NEC, this is a lot less densely populated than Europe (with 360 million over the US and Canada as opposed to about 600 million in an area no bigger than the Midwest and Northeast combined).  It's easier to fly for the longer distances, and the shorter ones tend to be too dispersed for rail.

[Michael in Philly]

^^I'm not sure Europe's that small, but it doesn't matter.  Even in the Northeast Corridor...  I lived in central Philadelphia for over a decade without owning a car, and am as transit-friendly as anyone.  But I do own a car now, and even though I'm within walking distance of 30th Street Station (I sometimes use it for things like the ATM and the food court), I haven't been on a train for three years, except once last winter when I needed to go to the suburbs for a work thing and my car was too snowed-in.  I used to go to Washington by train all the time.  But Amtrak's fares are too high.  Why should I pay well over $100 round trip, when I can essentially use a tank of gas and end up exactly where I want in Washington and on my own schedule?  (I haven't seen any demographics on Amtrak users, but I wonder if Northeast Corridor rail isn't in fact a bit of a luxury item for the relatively well off.)

So, while I definitely think, as a policy matter, rail should continue to be available in the Northeast - we can't continue to pump carbon into the air indefinitely or assume it'll be cheap to do so - I'm not convinced it's realistic to pump lots of money into corridors where it doesn't exist in the expectation it'll seriously compete with the roads.  Because I'm as well-positioned as anyone in the country to be carless, but I don't find rail competitive with the roads.  And, since I'm as well-positioned as anyone in the country to be carless (setting aside the very important factor of the cost differential), but drive for nearly everything I do beyond walking distance, I'm not going to be so hypocritical as to tell other people they should do otherwise.

[US71]

In this political climate, I'm not holding my breath.

Sadly, I concur. Too much time spent on "personal agendas".

[vdeane]

So wait, a significant chunk of the debt is money that the government owes to...itself? Why doesn't it just forgive its own debt?

Social security actually runs a separate budget.  The Federal Reserve isn't actually part of the government; it's only connection to it is that its top members are appointed by the president and confirmed by the senate.  It is otherwise a private organization, as the bankers wanted it to be.

I highly doubt the millions of Americans who have PAID INTO social security would be OK with the government just forgiving $3 trillion worth of debt to that fund. I know I wouldn't be.

What you "pay into" is actually just another tax.  Social security is a pay-as-you-go system; always has been.  There is no account waiting for you when you retire, and there never has been.

I could go for high interest rates right now, since I don't carry debt.

Same here.  Hyper-inflation only benefits the irresponsible and those with really good timing.

[nyratk1]

So wait, a significant chunk of the debt is money that the government owes to...itself? Why doesn't it just forgive its own debt?

Social security actually runs a separate budget.  The Federal Reserve isn't actually part of the government; it's only connection to it is that its top members are appointed by the president and confirmed by the senate.  It is otherwise a private organization, as the bankers wanted it to be.

I highly doubt the millions of Americans who have PAID INTO social security would be OK with the government just forgiving $3 trillion worth of debt to that fund. I know I wouldn't be.

What you "pay into" is actually just another tax.  Social security is a pay-as-you-go system; always has been.  There is no account waiting for you when you retire, and there never has been.

I could go for high interest rates right now, since I don't carry debt.

Same here.  Hyper-inflation only benefits the irresponsible and those with really good timing.

- And that's why they're ineffective...they can't regulate themselves. It's letting the fox guard the hen house.

- And all that blathering about SS being a drain...any shortfall won't pop up for another 25-30 years and even that can be corrected by the SS cap being removed. (Likewise, the blathering about the debt is another one of these decades down the line what-if scenarios that can be fixed without going into austerity.)

- Hyperinflation is damn near impossible: "There is actually a zero percent chance that a moderately-high inflation rate could ever balloon into hyperinflation in any economically advanced nation that is willing to impose intelligently-designed credit controls.  If banks are allowed to lend only a fixed quantity of money in particular loan categories, then it is categorically impossible for a moderately-high inflation rate to blossom into a "runaway"  hyperinflation event."

[english si]

Hyperinflation is damn near impossible: "There is actually a zero percent chance that a moderately-high inflation rate could ever balloon into hyperinflation in any economically advanced nation that is willing to impose intelligently-designed credit controls.  If banks are allowed to lend only a fixed quantity of money in particular loan categories, then it is categorically impossible for a moderately-high inflation rate to blossom into a "runaway"  hyperinflation event."

While Hyperinflation isn't going to happen, 'stagflation' is a threat - where stagnation in the economy and inflation in prices still going on (as the currency loses value) meaning that people can't afford stuff (especially exports).

The policy of low interest rates and quantitative easing helps those in debt as their loans become easier to pay back (as there's less interest to pay and the amount is worth less as the dollar/pound becomes worthless). However it doesn't help those that are financially prudent as wages and savings lose their relative value.

[Brandon]

Hyperinflation is damn near impossible: "There is actually a zero percent chance that a moderately-high inflation rate could ever balloon into hyperinflation in any economically advanced nation that is willing to impose intelligently-designed credit controls.  If banks are allowed to lend only a fixed quantity of money in particular loan categories, then it is categorically impossible for a moderately-high inflation rate to blossom into a "runaway"  hyperinflation event."

While Hyperinflation isn't going to happen, 'stagflation' is a threat - where stagnation in the economy and inflation in prices still going on (as the currency loses value) meaning that people can't afford stuff (especially exports).

The policy of low interest rates and quantitative easing helps those in debt as their loans become easier to pay back (as there's less interest to pay and the amount is worth less as the dollar/pound becomes worthless). However it doesn't help those that are financially prudent as wages and savings lose their relative value.

In other words, welcome back to the 1970s.  Where's your WIN* button?  

*Whip Inflation Now

[vdeane]

- Hyperinflation is damn near impossible: "There is actually a zero percent chance that a moderately-high inflation rate could ever balloon into hyperinflation in any economically advanced nation that is willing to impose intelligently-designed credit controls.  If banks are allowed to lend only a fixed quantity of money in particular loan categories, then it is categorically impossible for a moderately-high inflation rate to blossom into a "runaway"  hyperinflation event."

That would require that we actually regulate the banks.

[nyratk1]

- Hyperinflation is damn near impossible: "There is actually a zero percent chance that a moderately-high inflation rate could ever balloon into hyperinflation in any economically advanced nation that is willing to impose intelligently-designed credit controls.  If banks are allowed to lend only a fixed quantity of money in particular loan categories, then it is categorically impossible for a moderately-high inflation rate to blossom into a "runaway"  hyperinflation event."

That would require that we actually regulate the banks.

Still need other triggers for it and we're not Weimar Republic Germany where they had to pay massive reparations. And currently we're probably trending from slight inflation to slight deflation. But supply-side economics is not the solution and is just a finely crafted way to funnel money from the lower and middle class to the extreme upper class. If the lower and middle classes wages have been stagnant for 30 years, we don't funnel money to the top where the mega-corporations and extreme upper class just stash pretty much all of it away. There's no flow occurring.

[3467]

http://www.bloomberg.com/news/2011-08-21/wall-street-aristocracy-got-1-2-trillion-in-fed-s-secret-loans.html

This hasnt caused inflation. It hasnt helped to keep these zombies around. It would be much better to spend on infrastructure or just about anything else for that matter. next time you hear we cant afford that road.......

[Scott5114]

ITT: Nobody is an economist yet everyone has economic theories and Politics.™ This is pretty far off topic and has the danger of turning into RED! BLUE! RED! BLUE! if it goes much farther so I think it would be wise to just end it before we get to that point.