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2023-05-30 07:00 by Karl Denninger
in Federal Government , 380 references
[Comments enabled]  

The details are still a bit thin but.....

There is no reduction in the debt on the table.  That is, the government refuses to cut spending to less than what it can take in via taxes.

The growth in "mandatory" programs, specifically CMS, is where the problem is as I've pointed out for 30 years, all the way back to long before this column was originated and when I was running MCSNet.  Its a math problem when you get down to it, but that also means its a serious political problem because waving your arms around will do nothing.

What makes it worse is that all of it is illegal.  15 USC Chapter 1 makes what our medical and pharmaceutical firms do on a daily basis federal felonies carrying 10 year prison terms -- for each person screwed, and each occurrence.  Two decisions, Royal Drug (440 U.S. 205 (1979)) and Maricopa County (457 U.S. 332 (1982)) both found that there is no immunity from anti-trust law for medical providers, medical "insurance" companies or drug companies.

None.

These decisions have stood unchallenged since 1982.  No statute has modified them.  The cited claim of immunity in the first (McCarran-Ferguson) was disposed of as not applicable, so that sort of claim regarding insurance firms is void too as res judicata (already decided.)

Neither political party nor any of the States have in the 40 years since prosecuted anyone for these violations, nor sent anyone to prison -- including those who got slapped for doing it in the cases that went to the court originally themselves.  None have forced the end of discriminatory pricing practices.  California has gone even further and claimed authority to enact same at a state level despite the Supreme Court throwing up all over what they did in the 1982 decision prior to the state's act and nobody has gone after them either.

We cannot resolve the fiscal mess in the United States without resolving this.  There is no possible resolution without not only putting an end to this but removing it on a forward basis.  The cash-basis deficit within CMS is larger than the entire federal deficit for last year.  That is, if you fixed it there would be no deficit.  The inflation you see today would not exist.  The destruction of your purchasing power over the last several administrations would not have, in the main, happened.

The parties will not take this on because you won't force them to.  Instead you wish to talk about other things, all of which I'm sure you think are very important.  Without resolving this, however, there is no way to stop the inflationary monster that is eating your financial health alive and there is also no way to prevent what will inevitably occur: The collapse of the US medical system when it can no longer extract any more money, and if you need it at that point or beyond you will be dead.

Obamacare was all about trying to buy said system a few more years.  The covid "countermeasures" paid for by the government were as well.  The facts are that staffed beds have fallen by about a third since 1975 but the cost incurred in hospitals has skyrocketed.  During the last three years 18% of all persons hospitalized with a specific virus died yet in some counties, including mine, nearly 9 out of 10 died during a six month period -- specifically, the back half of 2021 which was much worse than the first few months when we allegedly "knew nothing" as this was a brand new disease.  Our government's policy was to pay bonuses for treatments even when they didn't work and even when they led to wildly out-of-norm and above average fatality rates -- in some cases, such as here, when said policies and "treatments" produced fatalities (failure) at five times the average rate across the nation as a whole.

Nobody has done anything about any of it, nor has one politician so much as raised a hand and asked for formal inquiry and explanation.  The money blown on these objectively-worthless measures -- after all, if you leave in a box the measures obviously were in fact worthless -- drove up the inflation rate in your state and town anyway and while you can debate whether the inflation is worth it if the treatments are successful there is no debate to be had when they fail

ALL of these payments were made through and by CMS.

The entire problem in our federal budget and spending lies there.

Yes, we can debate military spending and many other programs -- and should.

But if we don't fix this area of the budget using something like my proposal from years ago we will fail and so will our nation.

That failure, if we continue to allow this to go on, will come soon.

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2023-05-29 08:00 by Karl Denninger
in POTD , 112 references
 

 

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2023-05-29 07:00 by Karl Denninger
in Editorial , 207 references
[Comments enabled]  
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Memorial Day.

No, its not "beer-slugging day" or "steak-on-the-grill day."

The name is Memorial Day for a reason.

It is a national holiday during which we pay homage to those who died so we didn't have to.

Yes, some of those wars -- and many would argue most of them -- were unjust monstrosities.  That's a valid debate but one for another time -- any day, in fact, other than this one.

War is a monster; it eats the truth first and always.  As just one example of many Lincoln is often lionized as the "liberator" of blacks.  Yeah, he was a "liberator" all right: His intention was to repatriate all of them out of the United States and in fact was negotiating exactly that.  Funny how nobody ever brings that up -- and he has a huge memorial in Washington DC.

In the modern era we are currently doing war-by-proxy once again -- this time with Russia and Ukraine.  Perhaps this is all about the conduit in Ukraine for all manner of slush funding of this person or that, including our President, his entire family and what is likely half of Congress besides.  Many of them have never seen a war they didn't love.

Funny how that works when you don't have to hump a rifle and go take care of business yourself, isn't it?

I'll leave you with this: Think carefully about war today, and its price. 

That price being assessed upon all of us, for the first time in 150 years in this nation, may be much closer than you think.

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2023-05-28 07:00 by Karl Denninger
in Politics , 398 references
[Comments enabled]  
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As they say.... oops.

Democrat politicians have been buying votes for the last two decades with two policies:

  • Sanctuary cities.  That is, come here, legal or not, access services which cost taxpayers money, and its fine.  Whether that's education, medical care, housing, whatever.

  • Reparations.  The premise that black people today are owed something due to the legacy of slavery.

I've dealt with the absurdity of the latter several times in my column and see no particular reason to go back through all of it here.  It is simply sufficient to note that when it comes to both over-allocation of resources (e.g. dollars-per-pupil on education) and per-capita spend on welfare black people have gotten more and paid less for the last 50+ years to the tune of trillions of dollars.  Anyone who wishes to argue for such has to deduct all of that out first and its entirely possible you might find that if you do black people owe everyone else, not the other way around.

The sanctuary city nonsense, however, was especially rich.  

The mayors who did this had no expectation of any material percentage of the 20+ million illegal immigrants in the United States would show up to try to claim their alleged "sanctuary."  Most of these "migrants" are from warm climates in Central and South America and have no desire to deal with 0F overnight winters, never mind this white stuff called "snow."  But as more and more cities simply ran out of resource in the south and started busing these people northbound the claim they were "sanctuaries" with no boundaries was put to the test.

In Chicago, for example, the migrants with kids are not being required to document -- or take -- any of the childhood vaccines that everyone else is expected and in fact required to in order to enroll in school.  Leave aside Covid -- we're talking measles here.  Undocumented means just that and it includes medical status.  Never mind that almost none are fluent in English, so now all of them require ESL education and hiring teachers who are fluent in their native languages in order to begin or they learn nothing.  At the same time they're being put up in posh hotels paid for by the state or city while actual Americans, often people of color, are left to their own devices.

NYC has turned several $500/nt hotels into "sanctuaries" -- with zero enforcement of law.  The result is that they have immediately degenerated into drug, booze and orgy-filled hellholes that nobody in their right mind would stay in if there was any room for them to do so -- but there isn't.  Oh, and the city is paying the same $500/nt.  From where are they getting the money?  It'll be interesting to see how this works out given that this is basically screwing American citizens in NYC out of $15,000/month each that could otherwise be spent on them rather than the "migrant" lodging bill!

All of this spending, of course, screws the lowest income people hardest because the additional demand on goods and services is what drives inflation, so prices for rent, groceries and similar go up and screw the American citizens, again often black Americans, even more.

Reality is that none of these left-leaning Democrats actually thought they'd have to cash the checks they were writing with their mouths.  They were buying votes not with actual policy but with mere words that they never thought would be redeemed!

Now, unfortunately, the demands to "make good" are coming from all sides.  What can reasonably be expected in response?  "Bite me" isn't likely to go over very well but it will be quite interesting, specifically in the context of "reparations", which were unserious at all levels never mind unconstitutional as not even Treason can work corruption of blood nor may attainder extend beyond the lifetime of the offending party.

You'd have to amend the Constitution to change this and every left-leaning politician who ran this garbage knows it.  No attempt to invoke "reparations" would survive a challenge otherwise; that is, they knew damn well they were making a promise that could not be kept as it is directly unconstitutional to assess anyone -- whether directly or otherwise -- for a crime beyond the offender's death including the only crime explicitly noted on the Constitution itself.  Treason, by the way, is a specific exemption, valid only during the offender's lifetime, to what is otherwise an absolute in the Constitution.

You see Article 1 Section 9 explicitly forbids a federal Bill of Attainder in all other circumstances which is what reparations are; they are a declaration that a person or group of people is guilty of some offense and thereby punishing them since the funds for any such payments would have come from somewhere.  Section 10 forbids the same act by a state.

In other words this always was a dead letter promise and everyone who made it knew it.

Now let's see all those so-called "officials" deal with that fact and the backlash when every black American realizes that they were not only lied to but that the politicians who did so knew they were lying, knew what they were claiming and "studying" was per-se unconstitutional and would not survive ten seconds in a courtroom and made the promise to buy black votes anyway.

Oops.

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2023-05-27 07:00 by Karl Denninger
in Technology , 342 references
[Comments enabled]  

Nvidia.

They said "AI" and magically their stock explodes upward.

In all sobriety there is a pathway to serious innovation here; specifically, there is a lot of work being done on being able to substitute huge amounts of "training" data with more computing power.  This has been one of the conundrums forever; it in fact defined a huge part of the "de-mainframe" movement that had certain challenges that were very difficult to address -- specifically, I/O bandwidth which the mainframe was simply better at than "smaller" computers.  This in turn drove attempts to split up the work into parallel components all interconnected.

The folks on the front edge of this were often unsuccessful -- sometimes because people driving the process believed in that which mathematically wasn't going to work, sometimes because they were placing a bet on the advancement of technology that occurred more-slowly than it had to and sometimes because they just sucked at it -- what they were trying to do was possible, but not how they went about it.

AI is today thought of as "large language models" for the most part -- things like ChatGPT.  But there are smaller, more-specific forms that are already out in the field -- for example, security cameras that can identify a human face and track it.  That's quite useful and yet is a very limited for of "AI" as we think about it today.

There is always hype around the next new thing, whatever it might be, but most of the time, and for most of the people engaged in that endeavor, it fails and so do they.

This time feels like the last gasp at an attempt to herd people in the market -- which is hanging onto gains driven by uneconomic macro policies, specifically negative real interest rates -- by a thread.  I'm not liking this narrowing one bit particularly given what's driving it.

very much remember the furious valuation explosion in the 1990s and what happened in 2000.  If you think this will end any differently you're nuts.  The cryptokids were the last bubble driver and effectively screwed everyone who just wanted a nice, reasonably-fast graphics card in their PC by doubling or more the cost of said cards.  That's the market at work -- if you have more demand for a thing then of course price rises, and while more supply will come on vendors won't build it out unless they think that demand will be durable.

What I suspect is coming is the compartmentalization of actual usable "AI" into smaller "bites", driven in no small part by finding ways to code for GPU-type or even ASIC chipsets, taking advantage of their strengths and managing to shrink their monstrous data sets down to something that will fit in much smaller space.  Taken to its logical conclusion (and not beyond reasonable expectation either) this means compartmentalizing pieces so, for example, some of them run in your phone.  Not today -- but in a few more years.  Even more run on your laptop or desktop.

And ultimately this means that the hype collapses and the alleged "value" that is being bet on is just like Tulips -- very pretty but, in the end, technological advancement means its not worth a trillion dollars -- its worth a couple hundred billion -- maybe.

Oops.

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