Politics is the veneer that covers the real problem, economics.

It will always come down to two options if we stick to a capitalist model for the economy.

1. Expand

Capitalism works best were it can expand into new areas and create new markets. While it does, jobs are created, products are created, things are bought by those now working which leads to more and more. People start to use credit because inflation (price rises) is a by product of expanding markets. So the process of production and purchasing goes on supported by an ever increasing mountain of debt. This is all fine as long as there is room for growth as shown throughout the 1980s and 90s.

What does that mean for us today? What it means is we have hit this depression because we now have total economic globalisation. This was always going to happen because eventually capitalism would expand to encompass the whole world. It's just the nature of the thing. Now it cant expand any more, wages stall and start to lag behind inflation because inflation can only move one way, up. Debt becomes un-payable. This threatens banks, so currency rates start to fall and become de-valued. This in turn threatens pension schemes which quickly lose any hope of returning their investors anything like what was promised, if anything at all.

Money begins to stop moving around the economy as people try to hang on to their savings. With less money in the economy jobs begin to suffer as firms must trim costs to remain afloat. Governments (by now in a panic) raise retirement ages in a futile attempt to balance the books. But in reality it's just a drop in the massive ocean of debt. There is only one solution here, you have to find new markets for your economy to expand into, but where is the question? Which brings us to option 2....

2 Warfare

This solution has been well tried in the past, go to war and take or destroy what you cannot achieve through peaceful means. Objectives here are to remove your competitors completely and install your own markets in the extensive re-building in the aftermath. In effect you create a new area to expand into by force of arms. While we live on this one little planet the chances of this happening increase daily. What you have seen (as bad as it was in the costs in human life) in the Middle East thus far, is nothing compared to what is coming. There was me thinking we were all safe again after the cold war, WRONG! 😕

However, using option 2 can also have many unforeseen consequences, for example what if "the enemy" is more ruthless? You might lose or perhaps the ecology of the planet may be so damaged that no-one wins? So we all "live" in a real Fallout 3 world. No good, not good at all.

Does option 2 seem very cold blooded and in-human? You bet it is! 🙁

Overall then, how to get out of this mess? Invent a hyperdrive and get the hell out! 😀

Inflation is the expansion of the money supply (ie: printing), which devalues the base purchasing power of the currency as it moves through the system. Prices rising is only a reflection of the loss of value of the currency, as it takes more and more of the currency over time, to purchase the same products and services; previously.

In less than a century, the Federal Reserve Note has lost 97% of it's purchasing power. That's the real and only cause of inflation. Credit is a scam, where banks can create "purchasing power" (credit) out of thin air, and then charge you an interest. The system of credit is debt based, not wealth based. The wealth goes to the banks that "create" the credit, and the debt goes to the individual who "borrowed" the credit. The lender will always be master to the borrower.. that's the system.

Everything in this world swings on the same lynch-pin. Nothing will ever change until we all learn what money is and where it comes from...who benefits and who pays.

Sorry, have to disagree;

Politics is the avenue that facilitates the real problem, desire of power and control.

Politics are merely a vehicle used to manipulate your opponent, friends, or the people into acting in your interests. It can be used to blind others, and turn their attention to what you want them to focus on. An example of this would be a gay marriage vote in California. It was defeated, with approximately 65% of African-Americans and 80% of Hispanics voting against it. Who got the blame? Mormons, with a population percentage that might barely be able to break a 50/50 split, if most voted the same side. Why? Politics. The Democrats could not allow dissension among the ranks, and lose support from either side, so they choose an outside target.

This is very true, though the assumption the "areas" and "markets" are a physical location is flawed. "Areas" could be better expressed as "ideas" or "concepts". Communication used to be a simple landline telephone. Now it encompasses cellphones, satellite phones, two-ways, VOIP, and other forms. These examples are also markets, such as the cellphone being a sub-market of communications. Yet, that market didn't exist until someone invented the cellphone and people wanted to, and could afford to, buy it. A "market" is less a location, and more a group of people and/or businesses that find a product or service affordable and desirable.

This being the case, as long as humans continue to invent products and services, there will always be new areas and markets to expand into, just old areas and markets are abandoned and die. And yet, certain markets will always remain. These are primary needs, such as food and clothing, but these change constantly, as well. The types of food and clothing available now are not exactly the same as 50 years ago. And the market for food was probably the first to develop, and lead the start of capitalism.

As long as markets are allowed to be controlled by government, monopolies will be created with the full backing and power of the State. It's irrelevant to argue new products and services, and as long as we continue to let the Monopoly Men in DC pick and choose which products/services they want to allow, and which ones they want suppress, there will be no free market, no capitalism, and choice.

Some great posts and insights.

I have always looked at banks and credit as an evil that is hard to resist. I'm getting close to paying them all off and cutting them all but one. It's amazing how the banks own your life, say you are responsible with your money and you have only paid cash for everything you own and you have never gotten a loan or credit card in your life. 99% of the time you will probably be denied a loan because you lack a credit history. When in all actually you have the best history a banker could ask for, you have never owned debt because you save or pay in full when you can to prevent debt 🙂

That's true, and when a private company is getting too powerful and getting too much money they are considered a monopoly by the gov't and are forced to break it up. Why stop a company from doing well? Let the people decide if a company should succeed, it happens all the time. Example is Blockbuster they have filed for Bankruptcy protection because of the switch in home entertainment, Netflix and streaming are taking over and the people choose this and no one else. You just need to be a smart enough company to poll the community to see what they want and give it to them.

I hear this statement a lot from some of the radio talk show hosts.... "Has a poor man ever gave you a job?". People don't understand how true that is. USA is messed up when the government employees on avg make 30% more than the avg private sector employee and that gov't employee also gets a retirement pension after 20yrs when a private sector employee does not, doesn't seem to fair.

This happens in the UK too for those within the governmental apparatus, not true for public sector workers who are outside it though. Nurses, Social Workers and Care Workers (my own field) are poorly paid. Many try to get into the private sector were the wages are better.

I am also glad Volrider and Shingen are pulling my post to bits. Please keep it up! It's doing exactly what I wanted it to do, promote debate! Bet you all agree with my last point though! 😆

I actually agree a lot with what you post here. It's just that inflation isn't about expanding markets, it about expanding the money supply, which devalues the currency.

Pretty much everything revolves around money, and when the money becomes worthless; everything gets more expensive.

"All political power, so called, rests practically upon this matter of money. Any number of scoundrels, having money enough to start with, can establish themselves as a "government"; because, with money, they can hire soldiers, and with soldiers extort more money; and also compel general obedience to their will. It is with government, as Caesar said it was in war, that money and soldiers mutually supported each other; that with money he could hire soldiers, and with soldiers extort money. So these villains, who call themselves governments, well understand that their power rests primarily upon money. With money they can hire soldiers, and with soldiers extort money. And, when their authority is denied, the first use they always make of money, is to hire soldiers to kill or subdue all who refuse them more money."

Lysander Spooner