Wednesday, March 10, 2010

Peter Schiff: Fast Money, unemployment, big government

The Duke talks about his upcoming appearances on CNBC's 'Fast Money' show, and his Austrian perspective regarding the ongoing financial crisis.

He follows this with a discussion on the extension of unemployment benefits in the US which is turning unemployment into a permanent feature of the US economic environment, creating a moral hazard without actually being able to afford it, and the temptations for many to then slum it on the dole, fully leisured up, with a massive marginal tax rate if you should decide to go back to 'official' work (and the subsequent expansion of the black market, as people claiming the dole do jobs 'on the side', to avoid losing their benefits and to avoid paying these high marginal taxes).

(Welcome to the European experience, Peter! :-)

Rather remarkably, for a politician, he tells us of his own experience loafing on the beach in California as a young man exhausting his entitlement to the dole, before he went and got a job.

(Honesty and Austrianism always go together.)

There's some more stuff about crowding out and how the US government's spending has gone from 5% of the economy to 43% of the economy, with consumption now taking up to 70% of the US GDP, which is simply unsustainable (clue: it should be 50% - you produce the cake, you consume the cake).

(BTW Peter; what are you complaining about with a government spend of ONLY 43%? It's 50-55% here in England, and climbing. We'd be OVERJOYED if we could get it down to a measly 43%!! :-)


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