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2024-05-05 07:00 by Karl Denninger
in Editorial , 18883 references Ignore this thread
Demographic Disaster
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From CNN:

There were about 3.6 million babies born in 2023, or 54.4 live births for every 1,000 females ages 15 to 44, according to provisional data from the US Centers for Disease Control and Prevention’s National Center for Health Statistics.

You can look at this however you'd like but there is an underlying and very-seriously negative problem in here that nobody wants to acknowledge: If we do not address not only the rate but the balance of who's having kids and what they're inculcating in those kids we're screwed, and we do not have years or decades to do it either.

Simply put only the productive children -- that is, those who grow up and then produce more than they consume can keep a society going.  Some percentage of children are never going to be productive and for those who are unproductive simply due to bad luck its not their fault nor that of their parents -- fortune just is that way, and a just society doesn't treat them like a deformed puppy and cull them.

But you cannot make up for the lack of said productive children in your society by throwing open the borders and inviting "everyone" in.  Those who come here with their first act as a criminal one are demonstrably unfit right up front to fit into a social order that has "law-abiding" as any part of its requirement.  Oh sure, some will change their minds but their general mental position, which is "screw the law, I want mine" is not one you can permit on a mass-basis if you want to have a society at all.

There's an "interview" going around of a Biden advisor tying himself in knots verbally trying to explain the entire premise of government finance.  He makes the often-repeated claim that the government cannot go bankrupt because it can "print money."

Nobody can print money.  Not the government, not industry, not banks, not The Fed nor you.  NOT EVEN GOD can print money because money is the outcome of productive activity by humans.

But anyone can emit credit.  The only requirement to do that is the capacity to find someone else who believes you will produce something of value later worth at least as much as what is lent.  That's it.  You do it when you take a mortgage to buy a house or take out a loan to buy a car.  I do it when I take my Discover card out of my wallet to buy gasoline.  In days of old many taverns allowed you to do it for a drink, writing your name down and how many drinks you'd consumed.  They did that because they believed you would come settle the tab come payday, which you got in exchange for performing actual work of value for someone.

Today this is almost-all abstracted through a third party of some sort but the bottom line hasn't changed.  The same thing is true at a local, state or national level but of course the Federal Government (and State governments) are "more believed" than you as an individual because the Federal Government can tax you and nearly everyone pays those taxes without having to having to be threatened with being jailed or shot first.  That is in virtually every case you file and pay your taxes and for most they're withheld automatically so its actually somewhat of a pain in the ass not to pay.  This is the premise on which the government can issue bonds and thus borrow.

The abstraction layer, with you whipping out a credit card or the government issuing bonds, makes it all appear to be some sort of magic.  It is not.  The clowns running the "MMT" scam are lying and they know it, as I demonstrated on Lauren Lister's show quite-adequately in a two-up debate on air over a decade back, and for anyone who wants to take me on in this regard -- I'm up for a rematch anywhere, anytime, in any forum.  The truth is no different than the tavern 100 years ago.  You can print the credit for that drink because the owner of the bar believes you'll pay, and while he knows a few people won't because they can't the loss is small enough that he can absorb the occasional deadbeat and remain in business, and by allowing you to emit that credit you spend more than if you would have had to save it first.

In short money and credit both spend the same but they are not the same and governments can never create money because government is, by definition, a consumer of resources to provide common goods and services.  Government does not produce; it provides necessary functions (e.g. collective security, otherwise known as a "military") by distributing the production of individuals.

As you shift the percentage of people who will earn the money (by performing a useful task for someone at less renumeration than its value, which is of course necessary because otherwise they'd be stupid to hire you) toward those who do not and will not the percentage of losses goes up.  But this is not instantly apparent -- well, not unless you look, and in fact we do look and its reported all the time.

The national debt exists because there are more freeloaders in greater size than there are producers who provide more value than they extract. As with all exponential functions this looks like a free lunch when you start but if you don't cut it out the end is always disaster as the system in question collapses.  That this will occur if you keep at it is mathematical fact and mathematics are never false nor can they be voted upon or changed by political whim.

To fix this you have to change the incentives.

You have to cut off the freeloaders -- all who do not produce more than they consume -- and, those who are not citizens must be forced to leave -- right here, right now.

You have to incentivize citizens to form stable, bonded heterosexual pairs that, with only one of them working and the other raising children can do so with an economic surplus and demonstrate that such a surplus is possible to obtain in such a system so their children see that from their first moment of sentience forward.  No, not everyone will succeed, but a critical fraction must succeed because you must inculcate that in the next generation or you get the degenerate behavior we have now.  This in turn means that the cost of assets to do so must have their speculative premium reduced or entirely eliminated and thus collapse in price.  Yes, this means houses and other living units for openers.

If you demonstrate to children that you can blow up a two-parent home with kids and fuck up everyone's life for your own adult perversions, whatever they might be, why would those children go down that road when they don't believe it will work out?  Yes, some people do willingly smash their finger with a hammer, but a logical person calls such an individual mentally incompetent because they are!

In addition we had better roll back all of the things we've changed in terms of what go into children that have produced a fifteen percent educational disability rate.  That is either real and we did it and had better stop it right now under penalty of death for those who have and are doing it or its false and we're screwing both the kids and the parents -- and in the latter setting the example that your odds of being bankrupted by having a child are roughly one in seven!  Any middle-class couple would be nuts to produce kids with that set of odds and especially to have a second one when that second child has a one in seven chance of screwing not just the adults but the existing normal child!

There is no simple, one-answer prescription for all of this but all of these issues must be addressed right here, right now, with no excuses accepted.  The idea that banning abortion, for example, will "do it" is functionally insane.  A woman who chooses to abort a child obviously is in a position where she believes that having said child is a bad decision.  The "cheap and easy" answer is "ban the procedure" where the real problem is that you don't want to fix the underlying reason she thinks having the kid is a bad decision.

Well, here we are with a wide-open border and a crap-ton of people coming in -- and what's worse is that the vast majority of those currently having kids -- including those coming here through said open border are in fact not productive beyond their consumption and proof of this is found in the wildly-escalating National Debt.

We don't have 10, 20 or 30 years to reverse this.

We must reverse it right now because it takes about 20 years to grow a human from conception to adulthood and if we don't reverse it now there will be no ability to keep this crap up long enough to reverse what is about to happen at all.

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