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[Clansgian AT wmconnect.com]

Gene:

> That dog won't hunt. It has long been established that Medicare is a 
> greater danger to our national economy than Social Security, which, with 
> minor adjustments, can continue indefinitely.
> 

Many of us who are not trying to whistle past the graveyard have applied cold 
logic to the question.  What happens when more and more people get on a 
stipend of some sort (pension, stock profits, SS, etc.) and the money (which 
doesn 
not represent the production of anything) pursues the goods an services that 
the money of those who produce things is also pursuing.  Logically the only 
thing that can happen is that the price goes up.

This is an economic principle that escapes the modern mind used to dealing in 
insubstantials such as debt and credit.  People decried the money spent in 
foreign aid and military and said it should be spent to help hurricane 
victims.  
If twice as much money was suddenly available to by, say, plywood to repair 
homes, what would happen?   Would there be twice as much plywood available?  
No, because te lead time to produce it is too long, and if you begin to cut 
more 
trees (which take 30 years to grow back), it drives up the price of the logs 
for making plywood.

No, if you throw more money at the problem, it doesn't mean there is suddenly 
twice as much plywood ... so solving the equation for the other variable, 
what's the result?  The price doubles.

We, the logical, have long said that if SS (and the like, receiving a stipend 
when the person isn't producing anything) can only grow the the proportions 
expected and yet remain on the same dollar level, the only thing there is to 
give, to balance the equation as it were, is that prices must go up while the 
stipend income remains the same.

So what is happening?  We've sold millions of oversized McMansions because of 
an artificially stimualted economy, artifically stimulated by easing 
environmental regulations [as one way] [and giving mortgage brokers and real 
estate 
agents incomes extracted out of a compromised environment], and most of those 
McMansions are heated directly or indirectly by oil or natural gas.  The 
price 
of natural gas is forced up, at least 50% and if it's a bad winter by as much 
as 300%.   So the hue and cry is raised, 'What are all the poor geezers on SS 
going to do, how are they going to heat their cavernous homes this winter?'  

I say it is because more money, especially unearned money, is chasing goods 
that are more and more in demand.

Some say it's because of Bush.

It so much reminds me of an episode with my grandmother in the early 80's.  
She was 95 years old and hired two local fellows to clear some weeds from the 
side of the road.  They worked half a day, did the job, and she paid them 
each 
a quarter.  When we protested that she couldn't expect people to work half a 
day for a quarter, she protested that in her day men worked for twelve hours 
in 
them mines and in the logging camps for a dollar so she reckoned twenty-five 
cents for clearing some weeds for half a day was being generous.  We reminded 
her that times had channged in eighty years, a quarter didn't buy much any 
more.  Bread was over a dollar (it was more than twenty years ago) now of 
days.  
She became all the more indignat.  It was an outrage that anyone would want 
more than a quarter for such light work, and it was equally an outrage that 
bread was any more than 8 cents.

But the thing she never allowed for, never understood, is that the two were 
related.  Higher prices meant higher wages and higher wages allowed for 
higher 
prices.

Very much like that is the inability to grasp the significance of the 
economic times and why it is so very far removed from anything Bush is doing. 
 The 
rapidly increasing number of people on SS, disability, pension, stock 
dividend 
creates a situation where a *large* number of people have money which is 
pursuing a finite quantity of goods to which production they are not 
contributing.  
The price has to go up while their income remains the same.  And that's 
exaxtly what's happening.

Like my grandmother, so many don't seem to see how the two are related.

So it must be Bush's fault.