Self-Driving Technology Proves Fatal With Tesla Crash — No Consistent Sustainable Profits Ever — High Stock Prices Promoted By Wall Street Investment Bankers– Tesla Is Speculation Not An Investment — Drivers and Investors or Buyers Beware! — Videos

Posted on July 2, 2016. Filed under: American History, Articles, Autos, Blogroll, Business, Climate, Culture, Economics, Education, Energy, Entertainment, Environment, Faith, Freedom, Friends, government spending, history, Inflation, Internal Revenue Service (IRS), Investments, Law, liberty, Life, Links, media, Natural Gas, Natural Gas, Newspapers, Nuclear Power, Oil, Oil, People, Philosophy, Photos, Politics, Press, Radio, Rants, Raves, Raymond Thomas Pronk, Resources, Reviews, Television, Transportation, Unemployment, Video, Wealth, Wisdom, Work, Writing | Tags: , , , , , , , , , , , , , , , , , , |


Tesla Driver Killed In Crash with Autopilot System Driving

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Why Tesla’s Stock Is Heading to $200: James

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Fatal Telsa crash shows limits of self-driving technology


The U.S. government is investigating the first reported death of a driver whose car was in self-driving mode when he crashed. Joshua D. Brown, 40, died May 7 when his Tesla Model S, which was operating on “autopilot,” failed to activate its brakes and hit a truck in Florida.

The crash raises questions about autonomous and semi-autonomous cars, their capabilities and their limits. Here are answers to some of those questions:



A: Yes, but in limited numbers. Various companies, including Google, Ford and Uber, have test fleets of autonomous cars running in specific areas, including Mountain View, California, and Austin, Texas. Right now, those vehicles always have a steering wheel, brakes and a driver ready to take over in case of a problem, but prototype cars without steering wheels are also being developed.



A: A network of cameras, radars and lasers feeds information to the car’s computers, helping to fill in the gaps in the GPS system, which knows how to get the car from point to point. Cameras let the car see what’s around it, while radar senses things in the dark or in inclement weather. Lasers constantly scan the road and give a three-dimensional picture of what’s going on.



A: Right now, it’s a patchwork. Eight states — including Nevada, Michigan, Florida and Tennessee — and Washington D.C. have laws allowing autonomous vehicles. Other states have legislation in the works. Later this summer, the federal government is expected to release guidelines for the safe deployment of autonomous vehicles.



A: Self-driving cars have the potential to save lives by anticipating accidents before they happen. Intel CEO Brian Krzanich said Friday that 90 percent of car accidents are caused by human error, and distracted or drowsy driving accounts for some 13 percent of those crashes. The accidents cost about $870 billion a year globally.



A: No. A few automakers offer cars and SUVs with semi-autonomous modes that can perform some functions without help from the driver, including maintaining a set speed, braking, changing lanes and even parallel parking. Semi-autonomous features can be found on high-end vehicles from Tesla, Mercedes-Benz, Infiniti and Volvo. Some lower-priced models have them, too. Toyota, for example, plans to make automatic emergency braking standard on its vehicles by 2017, ahead of a self-imposed deadline of 2022 that most automakers have agreed to.



A: That’s not yet clear. Volvo plans a large-scale test of driverless cars in Sweden next year. Google wants to make cars available to the public around the end of 2019. BMW, Intel and Israel’s Mobileye have teamed up to roll out the cars by 2021.

IHS Automotive, a consulting firm, predicts that the U.S. will see the earliest deployment of autonomous vehicles, with several thousand on the road by 2020. That number will rise to 4.5 million vehicles by 2035, IHS says. But even if the vehicles are on the road, they might not be in your garage. The earliest self-driving cars might be on-demand taxis, employee shuttles or other shared vehicles.



A: Driverless cars need detailed maps to follow, and companies are still mapping roads. They also can have trouble staying within lanes in heavy rain or snow. And, as the Tesla crash showed, there will always be scenarios that driverless cars can’t foresee or navigate correctly. Brown’s car didn’t see an oncoming tractor-trailer because it was white against a brightly lit sky. Tesla CEO Elon Musk said the car’s radar is also designed to tune out what looks like overhead signs to prevent false braking.



A: Raj Rajkumar, a computer engineering professor at Carnegie Mellon University who leads its autonomous vehicle research, said computers can’t be programmed to handle every situation. But Tesla may need to adjust its radar, he said.

Tesla would not comment directly on the radar and computer programs, but the company issued a statement saying that it continually advances its software by analyzing hundreds of millions of miles of driving data. The National Highway Traffic Safety Administration is looking at the design and performance of Tesla’s system as part of its investigation.

Tesla has plenty of customers, but still no profit

Tesla is a hot mess—there is no path to profitability

Michael Pento, president of Pento Portfolio Strategies

Tuesday, 3 May 2016 | 1:55 PM ET

Tesla shares got a little pop in after-hours trading Wednesday after the electric car maker delivered an earnings report in line with expectations and an optimistic outlook.

But I think the stock’s run is already over.

The primary reason? Profitability.

Elon Musk

Getty Images
Elon Musk

Tesla stock soared for a few months starting in February following news that pre-orders for the electric-car maker’s Model 3, with a price tag of $35,000, were approaching 400,000 units.

But, as well-known short seller Jim Chanos so perfectly put it in an interview with CNBC: “We have all kinds of questions on the profitability of the business.”

First, the Model 3. This was Tesla’s play for an “affordable” electric car but it appears to be affordable for everyone EXCEPT Tesla.

Tesla loses more than $4,000 on each of its high-end Model S electric sedans; and that model’s cost is between $70 and $108k. With margins like that, one has to assume a $35k Model 3 can’t be the answer to solving Tesla’s red ink.

Tesla’s income statement reveals the company is hemorrhaging cash at a robust clip. Furthermore, according to TheStreet Ratings, they have a net profit margin of -26.38 percent and a quick ratio of 0.49, which means they have 49 cents in available cash to pay every $1 of current liabilities.

Worse than its lousy earnings and cash flow, Tesla is grossly overvalued compared to its peers. Tesla’s market cap is more than $30 billion, compared to Fiat Chrysler at around $10 billion and Ferrari at around $8 billion. Being valued at 3x more than FCAU — an established and profitable company — looks especially absurd when considering FCAU produces annual sales of over $130 billion, while Tesla produces revenue of only $4 billion.

Furthermore, Tesla’s market cap is nearly two-thirds of General Motors‘ market cap. This is despite the fact that General Motors has a history of selling 10 million cars at a profit each year and Tesla sold less than 100,000 cars last year at a loss. They would have to sell 6.6 million cars this year to justify its current valuation. With less than 400,000 cars on pre-order that doesn’t appear likely anytime soon.

In a February interview with CNBC’s Squawk Box, Former GM executive Bob Lutz noted that, “[TSLA] costs have always been higher than their revenue…They always have to get more capital. Then they burn through it.”

First, he pointed out that, on the back of falling oil prices, demand for electric vehicles (EVs) is slowing. Second, there is growing competition that will cut into Tesla’s margins as prices for EVs fall. Tesla has a lot of competition over the next few years. The industry is already awaiting the Apple car with bated breath that is set to launch in four years. And GM’s Chevy Bolt is similarly priced with a similar range and is set to come out this year. And then we have the Nissan Leaf expected to more competitive in the coming months and years. And add to that first generation vehicles like the BMW i3.

And in China, they have the EV Company LeEco, which recently unveiled its very first electric car that includes self-driving and self-parking capability using voice commands via a mobile app. Besides LeEco, there is another Chinese EV auto maker that sold more electric cars last year than Tesla, Nissan or GM, it’s called BYD Co. and is now targeting the U.S. market.

Lutz believes that competition from industry heavyweights like these could “kill” Tesla in the future.

“The major OEMs like GM, Ford, Toyota, Volkswagen, etc … they have to build electric cars, a certain number, in order to satisfy the requirements in about half of the states. Those have to be jammed into the marketplace, otherwise they can no longer sell SUVs and full-size pickups and the stuff that they really make money on. So that is going to generically depress the prices of electric vehicles,” Lutz warned.

Lutz also explained that companies such as General Motors will not be making any money on their “Tesla killer.” They are making these vehicles to appease Washington.

“The majors are going to accept the losses on the electric vehicles as a necessary cost of doing business in order to sell the big gasoline stuff that people really want. Well, Tesla does not have that option,” Lutz said.

But Musk has a strategy for driving down the cost of his electric car that hinges on achieving economies of scale, bringing down the production cost of the battery pack by 30 percent. This hinges on the success of their future Nevada home called the “Gigafactory.”

The Gigafactory is a one-stop shopping in battery-pack production. The company currently buys battery packs through a deal with Panasonicand has partnered with Panasonic in this venture. Production volume at the Gigafactory is anticipated to be the equivalent of over 30 gigawatt-hours per year; this would mean the Gigafactory would produce more storage than all the lithium battery factories in the world combined. The $5 billion dollar plant is as big as the Pentagon Tesla, and Tesla is hoping to produce 500,000 lithium ion batteries annually.

Musk recently laid out his Energy-branded battery ambition in rock star glory. At the event spectacle, Musk declared that his batteries would someday render the world’s energy grid obsolete. “We are talking about trying to change the fundamental energy infrastructure of the world,” he said.

Musk envisions his affordable, clean energy will one day power the remote villages of underdeveloped countries as well as allowing the average homeowner in industrial nations to go off the grid.

But before you sever your ties with your electrical company, it’s worth noting that not everyone thinks Musk’s plans are achievable – at least not in the time frame he envisions.

Panasonic, the supplier of the lithium-ion cells that form the foundation of Tesla’s batteries, and partner on the company’s forthcoming battery factory — calls Musk’s claims a lot of hyperbole.

“We are at the very beginning in energy storage in general,” said Phil Hermann, chief energy engineer at Panasonic Eco Solutions. “Most of the projects currently going on are either demo projects or learning experiences for the utilities. There is very little direct commercial stuff going on. Elon Musk is out there saying you can do things now that the rest of us are hearing and going, ‘really?’ We wish we could, but it’s not really possible yet.”

And far from the grand stage with little fanfare buried in their November 10Q Tesla also sought to tamper investor’s expectations: “Given the size and complexity of this undertaking, the cost of building and operating the Gigafactory could exceed our current expectations, we may have difficulty signing up additional partners, and the Gigafactory may take longer to bring online than we anticipate.”

With a company saddled with debt and cash-strapped, who is going to shoulder the burden of a delay in the Gigafactory realizing its full potential? That would be shareholders through stock dilution or the American tax payer – but most likely a combination of both. There are those who believe that Musk’s real genius is in following government subsidies.

Tesla’s model relies strongly on a “green” administration. According to the Los Angeles Times, all of Musk’s ventures: Tesla Motors, SolarCityand Space Exploration Technologies, known as SpaceX, together have benefited from an estimated $4.9 billion in government support. The figure underscores a common theme running through his emerging empire: a public-private financing model underpinning long-shot start-ups.

The promise is that the Tesla stockholders and the tax subsidizing public will greatly benefit from major pollution reductions as electric cars break through as viable alternative and gain access to mass-market production.

And frankly, I’m not convinced that electric cars are even good for the environment. First, it’s important to note that at this time, these cars don’t power themselves — they are plugged into an outlet in your garage that connects to an electric power plant. Second, there are a lot of environmental questions about the lithium battery itself. In a 2012 study titled “Science for Environment Policy” published by the European Union, a comparison was made of the lithium ion batteries to other types of batteries available such as; lead-acid, nickel-cadmium, nickel-metal-hydride and sodium Sulphur. They concluded that the lithium ion batteries have the largest impact on metal depletion, making recycling more complicated.

Musk may be a genius and a visionary but the truth is that Tesla has an unproven business model and a stock that is massively overpriced. Even if some year in the distant future there exists the charging infrastructure and pricing available to make electric vehicles conducive to supplant the internal combustion engine, Tesla faces an onslaught of competition that will most likely drive its profit margins further into the red for years to come.

So, as far as I’m concerned, the stock is not a buy — no matter what earnings say. The math just doesn’t add up.

Commentary by Michael Pento, the president and founder of Pento Portfolio Strategies and author of the book “The Coming Bond Market Collapse.” His weekly podcast is “The Mid-week Reality Check.”

Disclosure: Neither Michael Pento nor the firm own any positions in Tesla stock. However, several Pento clients own puts on Tesla.


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The Madoff Hustle — Videos

Posted on November 19, 2013. Filed under: American History, Blogroll, Business, Communications, Computers, Computers, Crime, Diasters, Economics, Education, Federal Government, Federal Government Budget, Fiscal Policy, Fraud, government, government spending, history, Law, liberty, Life, Links, Literacy, People, Philosophy, Programming, Raves, Tax Policy, Technology, Video, Wealth, Wisdom, Writing | Tags: , , , , , , , , , , , , , |


The Madoff Hustle – Part 1

The Madoff Hustle – Part 2

The Madoff Hustle – Part 3

The Madoff Hustle – Part 4

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Harry Markopolos — No One Would Listen: A True Financial Thriller — Videos

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Jim Rogers Asks Whether Obama Is ‘Delusional’ Or ‘Lying’–Videos

Posted on February 13, 2013. Filed under: American History, Banking, Blogroll, Business, College, Communications, Economics, Education, Federal Government, Federal Government Budget, Fiscal Policy, Foreign Policy, government spending, history, Inflation, Investments, Language, Law, liberty, Life, Links, Macroeconomics, media, Microeconomics, Monetary Policy, Narcissism, People, Philosophy, Politics, Psychology, Public Sector, Rants, Raves, Regulations, Security, Strategy, Talk Radio, Tax Policy, Taxes, Unemployment, Unions, Video, War, Wealth, Wisdom | Tags: , , , , , , , , , , , , |


Jim Rogers Asks Whether Obama Is ‘Delusional’ Or ‘Lying’

America is a FREAKING MESS…

Barack Obama is AMERICA’S DAD….

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Trillion Dollar Bet –Long Term Capital Management (LTCM)–Videos

Posted on January 2, 2013. Filed under: Blogroll, Communications, Economics | Tags: , , , , , , , , , , , , , , , , |


Trillion Dollar Bet 1

LTCM team:John Meriwether, the famed bond trader from Salomon Brothers, at its helm. Also on board were Nobel-prize winning economists Myron Scholes and Robert Merton, as well as David Mullins, a former vice-chairman of the Federal Reserve Board who had quit his job to become a partner at LTCM. These credentials convinced 80 founding investors to pony up the minimum investment of $10 million apiece, including Bear Sterns President James Cayne and his deputy.

Trillion Dollar Bet 2

Trillion Dollar Bet 3

Trillion Dollar Bet 4

Trillion Dollar Bet 5

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Colin A. Carter–Futures and Options Markets: An Introduction–University of California, Davis–Videos

Posted on May 3, 2012. Filed under: Agriculture, American History, Blogroll, Books, Business, College, Communications, Economics, Education, Employment, Energy, Farming, Food, government spending, history, Inflation, Investments, Law, liberty, Life, Links, media, Microeconomics, People, Philosophy, Politics, Psychology, Raves, Regulations, Resources, Security, Strategy, Taxes, Technology, Video, War, Wealth, Weather, Wisdom | Tags: , , , , , , , , , |

This course by Professor Colin Carter of agricultural and resource economics focuses on the institutional structure and economic functions of futures and options markets.         

Lecture 2: Course outline, futures markets history and market mechanics

Lecture 3: Futures contracts

Lecture 4: Options contracts and market history

Lecture 5: Reading futures contract price quote tables

Lecture 6: Function of futures and options markets, market mechanics

Lecture 7: Treasury-bond-futures trading and a video of action on the trading floor 

Lecture 8: Intertemporal commodity pricing, storage and how it affects a market 

Lecture 10: Demand for storage and foreign currency trading 

Lecture 11: Pricing financials 

Lecture 12: Eurodollars 

Lecture 13: Futures price forecasting

Lecture 14: Technical market analysis 

Lecture 15: A further review of technical analysis

Lecture 16: Introduction to hedging with futures

Lecture 17: Hedging continued

Lecture 18: Hedging risk vs. return, diversification and options on futures

Lecture 19: Options on futures continued, with examples

Lecture 20: Additional Options Concepts, Comparison of Futures and Options Trading 

Lecture 21: Options pricing and put-call parity, intro to arbitrage 

Lecture 22: Options trades

Lecture 23: Black-Scholes options pricing, volatility defined 

Lecture 24: Black-Scholes continued, the Delta Effect 

Lecture 25: Hedging using Options 

Lecture 26: Options Trades Examples, Course Review 

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Austrian Business Cycle Theory–Videos

Posted on June 16, 2011. Filed under: Banking, Blogroll, Economics, Employment, Federal Government, Fiscal Policy, government, government spending, Investments, Language, Law, liberty, Life, Links, media, Money, People, Philosophy, Politics, Rants, Raves, Talk Radio, Taxes, Video, Wealth, Wisdom | Tags: , , , , , |

Austrian Business Cycle Theory

Austrian Theory of the Business Cycle

Austrian Business Cycle Theory in 10 Minutes

The Austrian Theory in Perspective | by Roger W. Garrison

The Austrian Theory: A Summary | by Roger W. Garrison

Austrian Theory of the Trade Cycle | Roger W. Garrison

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The FairTax (National Consumption Sales Tax) vs. The Flat Tax (One Rate Federal Income Tax)–Who Pays The Most Federal Individual Income Tax? Videos

Posted on April 9, 2011. Filed under: American History, College, Economics, Education, Employment, Fiscal Policy, government, government spending, history, Language, Law, liberty, Life, Links, media, People, Philosophy, Politics, Psychology, Raves, Taxes, Technology, Video, War, Wealth, Wisdom | Tags: , , , , , , , , , |

“The income tax created more criminals than any other single act of government.”
~Barry Goldwater

Income Tax vs. Consumption Tax


What is the FairTax legislation?

“…What is the FairTax plan?

The FairTax plan is a comprehensive proposal that replaces all federal income and payroll based taxes with an integrated approach including a progressive national retail sales tax, a prebate to ensure no American pays federal taxes on spending up to the poverty level, dollar-for-dollar federal revenue neutrality, and, through companion legislation, the repeal of the 16th Amendment.

The FairTax Act (HR 25, S 13) is nonpartisan legislation. It abolishes all federal personal and corporate income taxes, gift, estate, capital gains, alternative minimum, Social Security, Medicare, and self-employment taxes and replaces them with one simple, visible, federal retail sales tax  administered primarily by existing state sales tax authorities.

The FairTax taxes us only on what we choose to spend on new goods or services, not on what we earn. The FairTax is a fair, efficient, transparent, and intelligent solution to the frustration and inequity of our current tax system.

The FairTax:

  • Enables workers to keep their entire paychecks
  • Enables retirees to keep their entire pensions
  • Refunds in advance the tax on purchases of basic necessities
  • Allows American products to compete fairly
  • Brings transparency and accountability to tax policy
  • Ensures Social Security and Medicare funding
  • Closes all loopholes and brings fairness to taxation
  • Abolishes the IRS

We offer a library of information throughout this Web site about the features and benefits of the FairTax plan. Please explore! …”


The FairTax: It’s Time


Tom Wright on the FairTax part 1


Why is the FairTax better than a flat income tax?


Dan Mitchell explains the fair tax


Laura Ingraham Interviews John Linder And Steve Forbes On Fair Tax Or Flat Tax


Five Key Reasons to Reject Class-Warfare Tax Policy

Who Pays Federal Income Taxes?


Uncle Sam Wants Your Money


It’s Simple to Balance The Budget Without Higher Taxes

Controlling Leviathan: The Battle for Limited Government

Question and Answer Session: The Fight Against Big Government


Table 1
Summary of Federal Individual Income Tax Data, 2008

(Updated October 2010)

  Number of Returns with Positive AGI AGI
($ millions)
Income Taxes Paid
($ millions)
Group’s Share of Total AGI Group’s Share of Income Taxes Income Split Point Average Tax Rate
All Taxpayers 139,960,580 8,426,625 1,031,512 100% 100% 12.24%
Top 1% 1,399,606 1,685,472 392,149 20.00% 38.02% $380,354 23.27%
1-5% 5,598,423 1,241,229 213,569 14.73% 20.70%   17.21%
Top 5% 6,998,029 2,926,701 605,718 34.73% 58.72% $159,619 20.70%
5-10% 6,998,029 929,761 115,703 11.03% 11.22%   12.44%
Top 10% 13,996,058 3,856,462 721,421 45.77% 69.94% $113,799 18.71%
10-25% 20,994,087 1,821,717 169,193 21.62% 16.40%   9.29%
Top 25% 34,990,145 5,678,179 890,614 67.38% 86.34% $67,280 15.68%
25-50% 34,990,145 1,673,932 113,025 19.86% 10.96%   6.75%
Top 50% 69,980,290 7,352,111 1,003,639 87.25% 97.30% >$33,048 13.65%
Bottom 50% 69,980,290 1,074,514 27,873 12.75% 2.70% <$33,048 2.59%
Source: Internal Revenue Service Table 6

Total Income Tax Shares, 1980-2008 (Percent of federal income tax paid by each group)
Year Total Top 0.1% Top 1% Top 5% Between 5% & 10% Top 10% Between 10% & 25% Top 25% Between 25% & 50% Top 50% Bottom 50%
1980 100%   19.05% 36.84% 12.44% 49.28% 23.74% 73.02% 19.93% 92.95% 7.05%
1981 100%   17.58% 35.06% 12.90% 47.96% 24.33% 72.29% 20.26% 92.55% 7.45%
1982 100%   19.03% 36.13% 12.45% 48.59% 23.91% 72.50% 20.15% 92.65% 7.35%
1983 100%   20.32% 37.26% 12.44% 49.71% 23.39% 73.10% 19.73% 92.83% 7.17%
1984 100%   21.12% 37.98% 12.58% 50.56% 22.92% 73.49% 19.16% 92.65% 7.35%
1985 100%   21.81% 38.78% 12.67% 51.46% 22.60% 74.06% 18.77% 92.83% 7.17%
1986 100%   25.75% 42.57% 12.12% 54.69% 21.33% 76.02% 17.52% 93.54% 6.46%
Tax Reform Act of 1986 changed the definition of AGI, so data above and below this line not strictly comparable
1987 100%   24.81% 43.26% 12.35% 55.61% 21.31% 76.92% 17.02% 93.93% 6.07%
1988 100%   27.58% 45.62% 11.66% 57.28% 20.57% 77.84% 16.44% 94.28% 5.72%
1989 100%   25.24% 43.94% 11.85% 55.78% 21.44% 77.22% 16.94% 94.17% 5.83%
1990 100%   25.13% 43.64% 11.73% 55.36% 21.66% 77.02% 17.16% 94.19% 5.81%
1991 100%   24.82% 43.38% 12.45% 55.82% 21.46% 77.29% 17.23% 94.52% 5.48%
1992 100%   27.54% 45.88% 12.12% 58.01% 20.47% 78.48% 16.46% 94.94% 5.06%
1993 100%   29.01% 47.36% 11.88% 59.24% 20.03% 79.27% 15.92% 95.19% 4.81%
1994 100%   28.86% 47.52% 11.93% 59.45% 20.10% 79.55% 15.68% 95.23% 4.77%
1995 100%   30.26% 48.91% 11.84% 60.75% 19.62% 80.36% 15.03% 95.39% 4.61%
1996 100%   32.31% 50.97% 11.54% 62.51% 18.80% 81.32% 14.36% 95.68% 4.32%
1997 100%   33.17% 51.87% 11.33% 63.20% 18.47% 81.67% 14.05% 95.72% 4.28%
1998 100%   34.75% 53.84% 11.20% 65.04% 17.65% 82.69% 13.10% 95.79% 4.21%
1999 100%   36.18% 55.45% 11.00% 66.45% 17.09% 83.54% 12.46% 96.00% 4.00%
2000 100%   37.42% 56.47% 10.86% 67.33% 16.68% 84.01% 12.08% 96.09% 3.91%
2001 100% 16.06% 33.89% 53.25% 11.64% 64.89% 18.01% 82.90% 13.13% 96.03% 3.97%
2002 100% 15.43% 33.71% 53.80% 11.94% 65.73% 18.16% 83.90% 12.60% 96.50% 3.50%
2003 100% 15.68% 34.27% 54.36% 11.48% 65.84% 18.04% 83.88% 12.65% 96.54% 3.46%
2004 100% 17.44% 36.89% 57.13% 11.07% 68.19% 16.67% 84.86% 11.85% 96.70% 3.30%
2005 100% 19.26% 39.38% 59.67% 10.63% 70.30% 15.69% 85.99% 10.94% 96.93% 3.07%
2006 100% 19.56% 39.89% 60.14% 10.65% 70.79% 15.47% 86.27% 10.75% 97.01% 2.99%
2007 100% 20.19% 40.41% 60.61% 10.59% 71.20% 15.37% 86.57% 10.54% 97.11% 2.89%
2008 100% 18.47% 38.02% 58.72% 11.22% 69.94% 16.40% 86.34% 10.96% 97.30% 2.70%
Source: IRS

US State Sales Tax Rates – 2010
State sales tax rate (January 1st, 2010)%
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Rhode Island
South Carolina
South Dakota
West Virginia
Washington DC

The 48 Contiguous States and DC
Persons in family Poverty guideline
1 $10,830
2 14,570
3 18,310
4 22,050
5 25,790
6 29,530
7 33,270
8 37,010
For families with more than 8 persons, add $3,740 for each additional person.


Federal income tax rates

1930 – 1960

Historical income tax rates for Married Filing Jointly at stated income levels.[3]

Year $20,001 $60,001 $100,001
1930 10% 21% 25%
1932 16% 36% 56%
1934 19% 37% 56%
1936 19% 39% 62%
1938 19% 39% 62%
1940 28% 51% 62%
1942 55% 75% 85%
1944 59% 81% 92%
1946 56% 78% 89%
1948 56% 78% 89%
1950 56% 78% 89%
1952 62% 80% 90%
1954 56% 78% 89%
1956 38% 62% 75%
1958 38% 62% 75%
1960 38% 62% 75%

Year 2008 income brackets and tax rates

Marginal Tax Rate Single Married Filing Jointly or Qualified Widow(er) Married Filing Separately Head of Household
10% $0 – $8,025 $0 – $16,050 $0 – $8,025 $0 – $11,450
15% $8,026 – $32,550 $16,051 – $65,100 $8,026 – $32,550 $11,451 – $43,650
25% $32,551 – $78,850 $65,101 – $131,450 $32,551 – $65,725 $43,651 – $112,650
28% $78,851 – $164,550 $131,451 – $200,300 $65,726 – $100,150 $112,651 – $182,400
33% $164,551 – $357,700 $200,301 – $357,700 $100,151 – $178,850 $182,401 – $357,700
35% $357,701+ $357,701+ $178,851+ $357,701+

Year 2009 income brackets and tax rates

Marginal Tax Rate[4] Single Married Filing Jointly or Qualified Widow(er) Married Filing Separately Head of Household
10% $0 – $8,350 $0 – $16,700 $0 – $8,350 $0 – $11,950
15% $8,351 – $33,950 $16,701 – $67,900 $8,351 – $33,950 $11,951 – $45,500
25% $33,951 – $82,250 $67,901 – $137,050 $33,951 – $68,525 $45,501 – $117,450
28% $82,251 – $171,550 $137,051 – $208,850 $68,526 – $104,425 $117,451 – $190,200
33% $171,551 – $372,950 $208,851 – $372,950 $104,426 – $186,475 $190,201 – $372,950
35% $372,951+ $372,951+ $186,476+ $372,951+

Year 2010 income brackets and tax rates

Marginal Tax Rate[5] Single Married Filing Jointly or Qualified Widow(er) Married Filing Separately Head of Household
10% $0 – $8,375 $0 – $16,750 $0 – $8,375 $0 – $11,950
15% $8,376 – $34,000 $16,751 – $68,000 $8,376 – $34,000 $11,951 – $45,550
25% $34,001 – $82,400 $68,001 – $137,300 $34,001 – $68,650 $45,551 – $117,650
28% $82,401 – $171,850 $137,301 – $209,250 $68,651 – $104,625 $117,651 – $190,550
33% $171,851 – $373,650 $209,251 – $373,650 $104,626 – $186,825 $190,551 – $373,650
35% $373,651+ $373,651+ $186,826+ $373,651+


Background Articles and Videos


Why Is The Fair Tax so Controversial–My Contribution to Fair Tax Friday

Mar 25th, 2011 by David Anderson

“…The result is the tax code is 71,684 pages (2010). In 2006, before Pelosi took over, it was 61,845 pages.   In 2005, the federal government estimated that the code and regulations contained 9,097,000 words. That is why it is burdensome.  It is a huge lodestone attaching itself to our economy and weighing us down in the international race for jobs and growth.  Fair Tax advocates say that it costs us 900 dollars per man, woman, boy, and girl in compliance costs.   According the Tax Foundation, it costs us an estimated 368,000,000,000 dollars in compliance cost which is higher than Fair Tax estimates.  Large companies have entire floors devoted to compliance with the tax code not productive activities.

Compare it to the Fair Tax proposal.  It is no comparison.  You are no longer manipulated.   Naturally, charitable donations and education expenses are not taxed.   You are not constantly manipulated. The hand of despotism is vanquished.  We go from 71,00 pages to 36 pages of code.   Compliance costs drop dramatically. 

Even better, we will finally have a tax system designed to grow the economy.   Currently imports get better treatment than domestic production.  The playing field is leveled. Exports won’t be taxed at all.  We will finally be ready to compete in the world.  America will stop destroying and shipping out manufacturing and the orphaned investments kept offshore by our highest in the world corporate income tax will flow back and forth into our economy.  The worst case estimates of growth are 5 to 7%.  Other estimates are as high as 14% growth.  We currently average around 3% and in the last few years struggle to reach 2% growth.  The difference between 2% growth and 6% growth is an economy doubling every 32 years or one doubling every 12 years.  That is huge. …”

Tom Wright on the FairTax part 1


Tom Wright on the FairTax part 2


Tom Wright on the FairTax part 3


Tom Wright on the FairTax part 4


Tom Wright on the FairTax part 5


Tom Wright on the FairTax part 6


Tom Wright on the FairTax part 7


Why is the FairTax better than other tax reform efforts?


Does the FairTax repeal the federal income tax?


How does the FairTax affect the economy?


Is the FairTax truly progressive?


How does the “prebate” work?


Is it fair for rich people to get the same prebate as poor people?


Do corporations get a windfall break from the FairTax?


How do we keep exemptions and exclusions from undermining the FairTax?


Wouldn’t it be more fair to exempt food and medicine from the FairTax?


How does the FairTax rate compare to today’s?


Is the FairTax rate really 23%?


How is the FairTax different from a Value Added Tax (VAT)?


Will the prebate create a massive new entitlement system?


How does the FairTax impact the middle class?


How will the FairTax impact seniors?


How does the FairTax affect tax preparers and CPAs?


How does the FairTax impact charitable giving?



How does the FairTax affect compliance costs?


Will the FairTax hurt home ownership with no mortgage interest deduction?


Will the FairTax hurt home ownership with no mortgage interest deduction?


How will the FairTax help people who don’t hire an accountant?


How will the FairTax impact people who don’t file income taxes?


Will the FairTax drive the economy down if people stop buying?


How will the FairTax affect state sales tax systems?


Are any significant economies funded by a sales tax?


Is education taxed under the FairTax?


Will government pay taxes under the FairTax?


Will the FairTax impact tax deferred retirement accounts like 401(k)s?


What will happen to cities who depend on tax free bonds?

How does the FairTax impact tax free bonds?


How will Social Security payments be calculated under the FairTax?


What will happen to government programs like Social Security and Medicare?


How can you tax life saving medical treatment?


Will bartering present a compliance problem under the FairTax?


How will used goods be taxed?


Can’t Americans just cross the border to avoid the FairTax


How does the FairTax affect illegal immigration?


Isn’t it a stretch to say the IRS will go away?


What will the transition be like from the income tax to the FairTax?


FairTax Show – Part 1


FairTax Show – Part 2


Ron Paul on Taxes


Policy Resources

The following organizations provide policy analysis on taxation and related issues:

Tax Policy Organizations:

Small Business Policy Organizations:

General Public Policy Research Organizations:




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Cheap Money and Rampant Speculation Drive Skyrocketing Oil Prices–Videos

Posted on January 18, 2011. Filed under: Agriculture, Banking, Blogroll, Communications, Crime, Economics, Employment, Energy, Federal Government, Fiscal Policy, government, government spending, Law, liberty, Life, Links, media, Monetary Policy, Money, People, Philosophy, Politics, Rants, Raves, Technology, Video, Wealth, Wisdom | Tags: , , , , , , , |


Hearing on Energy Speculation, Gas Prices: Masters Testimony


Hearing on Energy Speculation & Gas Prices: Stupak Questions


Goldman Vet Sparks Conflict On Hill


CFTC Crackdown On Commodity Speculation – Bloomberg



Inside Look – Future of the CFTC – Bloomberg


CFTC Chairman Nomination Hearing Questions


Peter Schiff – Warren Buffett is Dead Wrong


Commodity Prices Reach a Two-Year High


Cantwell and McCain Hold A Press Conference


Oil Price Manipulation 1


Oil Price Manipulation 2


Oil Price Manipulation 3


Oil Price Manipulation 4


Oil Price Manipulation 5


Oil Price Manipulation 6


Oil Price Manipulation 7


Oil Price Manipulation 8


Oil Price Manipulation 9


Oil Price Manipulation 10

Oil Price Manipulation 11


Oil Price Manipulation 12


Oil Price Manipulation 13


Oil Price Manipulation 14


Blame High Gas Prices on Laziness and Greed

Just as the U.S. economy seems about to recover, oil speculators are again ratcheting up gas prices. Don’t let them get away with it, says Ed Wallace

“…Of course the oil pundits—whether industry analysts, commentators, lobbyists, or executives—validate the high price of oil. They usually do, saying as always that either gasoline supplies or crude oil on hand is in short supply, hence the increased prices. But that hasn’t been true. Gasoline inventories on Dec. 17 were 217 million barrels, slightly more than gasoline inventories in the last week of February 2009—when the price of crude neared $33 a barrel in the wake of the previous fall’s financial meltdown.

Likewise on Dec. 17, oil inventories in the U.S. stood at 340.6 million barrels. That’s only 10 million barrels less than we had in the last week of February 2009—again, when oil had fallen back to $33.

Fact is, we have more oil on hand today (13 million barrels) and just three million barrels of gasoline less than we did at the end of January 1999, a period when gasoline prices were down near the $1 mark. As for strong economic growth dictating higher oil and gas prices, it should be noted that our GDP grew 5.4 percent in late 1998—and growth would improve to 7.1 percent at the start of 1999. Yet gasoline was a buck a gallon. …”

“…Yes, it’s 2008 redux: Energy prices are rising in the face of four-year weakened U.S. demand and high inventories worldwide.

At this rate, it won’t take long until skyrocketing oil and gasoline prices drag the current economic recovery to a halt. Worse, if oil and gasoline prices go up for consumers and business in 2011 by a substantial amount, reducing the unemployment numbers may not be possible. …”

“…After all, speculators who never intend to take delivery of one drop of oil continue to plow more cheap capital into those contracts, thereby distorting the real discovery price.

After five years of this costly behavior, it has become clear that they’re not going to change if they don’t have to. The government could fix this problem quickly by severely reducing the amount of leverage or borrowing permitted to purchase commodity contracts and by raising interest rates. But neither move seems likely. …” 

Background Articles and Videos












Petrodollar, Petrodollar warfare 1


Petrodollar, Petrodollar warfare 2


Petrodollar, Petrodollar warfare3



Michael Greenberger Talks Speculation In Commodity Markets

Derivatives Warning – Michael Greenberger interview

Mike Masters on Regulating Commodities Speculation


CHHS Director explains derivatives regulation on C-SPAN – 5/15/09


The Biz Flog — Blaming Oil Speculators for High Gas Prices

The Oil Speculator

Hedge Funds’ Black Gold – Why the oil price is so high PART1


Hedge Funds’ Black Gold – Why the oil price is so high PART2


Cost of carry model to price forwards & futures


Contango & backwardation in commodity forward markets


List of the Primary Government Securities Dealers Reporting to the Government Securities Dealers Statistics Unit of the Federal Reserve Bank of New York

BNP Paribas Securities Corp.
Barclays Capital Inc.
Cantor Fitzgerald & Co.
Citigroup Global Markets Inc.
Credit Suisse Securities (USA) LLC
Daiwa Capital Markets America Inc.
Deutsche Bank Securities Inc.
Goldman, Sachs & Co.
HSBC Securities (USA) Inc.
Jefferies & Company, Inc.
J.P. Morgan Securities LLC
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Mizuho Securities USA Inc.
Morgan Stanley & Co. Incorporated
Nomura Securities International, Inc.
RBC Capital Markets, LLC
RBS Securities Inc.
UBS Securities LLC.

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Peter Schiff–Videos

Posted on June 19, 2009. Filed under: Blogroll, Economics, Education, Employment, Energy, Investments, Links, People, Politics, Raves, Regulations, Video | Tags: , , , , , , , , |


 “There is nothing the Fed can do to combat inflation unless they hike rates aggressively.”

~Peter Schiff


Peter Schiff : Economy is phony, Dollar would collapse if not for BRIC countries interventions


Peter Schiff predicts Imminent Doom – Fear And Loathing In America


Authors@Google: Peter Schiff


Why the Meltdown Should Have Surprised No One


Peter Schiff Responds to Critics on Fox Business 02-02-09


Peter Schiff: They’re Gonna Change This Into An Inflationary Depression!


Dollar Collapse – The Schiff Has Hit The Fan – End Game 2012


10/13/2008 – Peter Schiff On Glenn Beck: Inflation Nation?


Peter Schiff Analogies


Peter Schiff Was Right 2006 – 2007 (2nd Edition)


Nov 2006 Peter Schiff Mortgage Bankers Speech Part 1 of 8


Nov 2006 Peter Schiff Mortgage Bankers Speech Part 2 of 8


Nov 2006 Peter Schiff Mortgage Bankers Speech Part 3 of 8


Nov 2006 Peter Schiff Mortgage Bankers Speech Part 4 of 8


Nov 2006 Peter Schiff Mortgage Bankers Speech Part 5 of 8


Nov 2006 Peter Schiff Mortgage Bankers Speech Part 6 of 8


Nov 2006 Peter Schiff Mortgage Bankers Speech Part 7 of 8


Nov 2006 Peter Schiff Mortgage Bankers Speech Part 8 of 8


February 2006 Peter Schiff U.S. Bubble Economy Part 1 of 5


February 2006 Peter Schiff U.S. Bubble Economy Part 2 of 5


February 2006 Peter Schiff U.S. Bubble Economy Part 3 of 5



February 2006 Peter Schiff U.S. Bubble Economy Part4 of 5



February 2006 Peter Schiff U.S. Bubble Economy Part 5 of 5


PETER SCHIFF – 6 YEARS AGO — “…and they will panic” – PT1


PETER SCHIFF – 6 YEARS AGO — “…and they will panic” – PT1

“The Fed’s study is flawed as the comparisons are not relevant, … When the world dumps dollars, they will also dump Treasuries, sending rates soaring.”

~Peter Schiff

Background Articles and Videos

Peter Schiff

Peter David Schiff (born March 23, 1963)[1] is an American economic commentator, author and licensed stock broker who currently serves as president of Euro Pacific Capital Inc., a brokerage firm based in Darien, Connecticut which he owns.[2]

Schiff is best known for his bearish views on the United States economy and for his prescient predictions of the economic crisis of 2008.[3][4] He has risen to media prominence following the publication of his book Crash Proof: How to Profit From the Coming Economic Collapse, published in 2007.

Schiff appears on American financial news programs on networks such as CNBC, CNN, CNN International, Fox News, Bloomberg TV and Fox Business.

Schiff is a supporter of the Austrian School of Economics and the Ludwig von Mises Institute[5], and was an economic adviser for Ron Paul’s campaign in the 2008 Republican Party primaries, through which Schiff also expressed support for sound money, limited government, and free market capitalism.

As of June 2009[update], Schiff is eyeing a run for the Republican nomination to challenge Democrat Christopher J. Dodd, Connecticut’s five-term senior senator.[6]

The World Won’t Buy Unlimited U.S. Debt

We’re asking others to sacrifice for our ‘stimulus.’

By Peter Schiff

“…What he might have said was that the nations funding the majority of America’s public debt — most notably the Chinese, Japanese and the Saudis — need to be prepared to sacrifice. They have to fund America’s annual trillion-dollar deficits for the foreseeable future. These creditor nations, who already own trillions of dollars of U.S. government debt, are the only entities capable of underwriting the spending that Mr. Obama envisions and that U.S. citizens demand.

These nations, in other words, must never use the money to buy other assets or fund domestic spending initiatives for their own people. When the old Treasury bills mature, they can do nothing with the money except buy new ones. To do otherwise would implode the market for U.S. Treasurys (sending U.S. interest rates much higher) and start a run on the dollar. (If foreign central banks become net sellers of Treasurys, the demand for dollars needed to buy them would plummet.)

In sum, our creditors must give up all hope of accessing the principal, and may be compensated only by the paltry 2%-3% yield our bonds currently deliver. …”


Peter Schiff Video Blog


Peter Schiff Blog


Euro Pacific


Ludwig von Mises Institute


Related Posts On Pronk Palisades

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United States Economic Depressions–The Good, The Bad, and The Ugly–Obama’s Depression–Over 15,000,000 Americans Seek Full Time Job!

Posted on June 11, 2009. Filed under: Blogroll, Economics, Employment, Homes, Investments, liberty, Life, Links, People, Philosophy, Politics, Quotations, Rants, Raves, Regulations, Taxes, Technology, Video, Wisdom | Tags: , , , , , , , , , , , , , , , , , , , , , , |


“It is estimated that in 1933, at the depth of the Great Depression, about 13 million
persons in the U.S. were unemployed, which translates into an unemployment rate of
about 25 percent.1 However, those estimates were not available at the time. Throughout
the Great Depression, there was little information on the extent of unemployment in the
country. More important, there was no good way to assess whether the situation was
getting better or worse. The wealth of timely statistical information on the labor market
that we now take for granted simply didn’t exist.”

~Measures of labor underutilization from the Current Population Survey

Working Paper 424,  March 2009

Steven E. Haugen, U.S. Bureau of Labor Statistics

“It is obviously futile to attempt to eliminate unemployment by embarking upon a program of public works that would otherwise not have been undertaken. The necessary resources for such projects must be withdrawn by taxes or loans from the application they would otherwise have found. Unemployment in one industry can, in this way, be mitigated only to the extent that it is increased in another.”

~Ludwig von Mises, Liberalism, page 85


Unemployment Rate Surges


Today in the United States there are over 14,500,000 individuals unemployed and seeking a full time job.

Labor Force Statistics from the Current Population Survey

Series Id:           LNS13000000
Seasonal Adjusted
Series title:        (Seas) Unemployment Level
Labor force status:  Unemployed
Type of data:        Number in thousands
Age:                 16 years and over
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
1999 5976 6111 5783 6004 5796 5951 6025 5838 5915 5778 5716 5653  
2000 5708 5858 5733 5481 5758 5651 5747 5853 5625 5534 5639 5634  
2001 6023 6089 6141 6271 6226 6484 6583 7042 7142 7694 8003 8258  
2002 8182 8215 8304 8599 8399 8393 8390 8304 8251 8307 8520 8640  
2003 8520 8618 8588 8842 8957 9266 9011 8896 8921 8732 8576 8317  
2004 8370 8167 8491 8170 8212 8286 8136 7990 7927 8061 7932 7934  
2005 7759 7972 7740 7683 7672 7551 7415 7360 7570 7457 7541 7219  
2006 7020 7176 7080 7142 7028 7039 7167 7118 6874 6738 6837 6688  
2007 7029 6887 6737 6874 6844 7028 7128 7123 7221 7295 7212 7541  
2008 7555 7423 7820 7675 8536 8662 8910 9550 9592 10221 10476 11108  
2009 11616 12467 13161 13724 14511                

The official U.S. Bureau of Labor Statistics unemployment rate  (U-3)   for May 2009 was 9.4%.

Labor Force Statistics from the Current Population Survey

Series Id:           LNS14000000
Seasonal Adjusted
Series title:        (Seas) Unemployment Rate
Labor force status:  Unemployment rate
Type of data:        Percent
Age:                 16 years and over
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
1999 4.3 4.4 4.2 4.3 4.2 4.3 4.3 4.2 4.2 4.1 4.1 4.0  
2000 4.0 4.1 4.0 3.8 4.0 4.0 4.0 4.1 3.9 3.9 3.9 3.9  
2001 4.2 4.2 4.3 4.4 4.3 4.5 4.6 4.9 5.0 5.3 5.5 5.7  
2002 5.7 5.7 5.7 5.9 5.8 5.8 5.8 5.7 5.7 5.7 5.9 6.0  
2003 5.8 5.9 5.9 6.0 6.1 6.3 6.2 6.1 6.1 6.0 5.8 5.7  
2004 5.7 5.6 5.8 5.6 5.6 5.6 5.5 5.4 5.4 5.5 5.4 5.4  
2005 5.2 5.4 5.2 5.2 5.1 5.1 5.0 4.9 5.0 5.0 5.0 4.8  
2006 4.7 4.8 4.7 4.7 4.7 4.6 4.7 4.7 4.5 4.4 4.5 4.4  
2007 4.6 4.5 4.4 4.5 4.5 4.6 4.7 4.7 4.7 4.8 4.7 4.9  
2008 4.9 4.8 5.1 5.0 5.5 5.6 5.8 6.2 6.2 6.6 6.8 7.2  
2009 7.6 8.1 8.5 8.9 9.4        

By July 4, 2009 the number of unemployed Americans is expected to exceed 15 million!

During the worse year of the Great Depression, 1933, the unemployment rate rose to 24.9%

While this unemployment rate was much higher than today’s official unemployment rate, the number of individuals unemployed was significantly less.

In 1933 there were over 12,800,000 individuals unemployed and seeking a full time job.

The United States in 2009 has with the economic policies and massive government spending of President Barack  Obama  has resulted in more than 2,000,000 Americans unemployed than at the bottom of the Great Depression in 1933.

The U.S. Bureau of Labor Statistics  total unemployment rate (U-6) for May 2009 was 16.4% which includes marginally attached, discouraged and part-time workers seeking full time job.

Table A-12. Alternative measures of labor underutilization (Percent)

Labor Force Statistics from the Current Population Survey

Series Id:           LNS13327709
Seasonal Adjusted
Series title:        (seas) Total unemployed, plus all marginally attached workers plus total
                     employed part time for economic reasons, as a percent of all civilian labor
                     force plus all marginally attached workers
Labor force status:  Aggregated totals unemployed
Type of data:        Percent
Age:                 16 years and over
Percent/rates:       Unemployed and mrg attached and pt for econ reas as percent of labor force plus
                     marg attached
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
1999 7.7 7.7 7.6 7.6 7.4 7.5 7.5 7.3 7.4 7.2 7.1 7.1  
2000 7.1 7.2 7.1 6.9 7.1 7.0 7.0 7.1 7.0 6.8 7.1 6.9  
2001 7.3 7.4 7.3 7.4 7.5 7.9 7.8 8.1 8.7 9.3 9.4 9.6  
2002 9.5 9.5 9.4 9.7 9.5 9.5 9.6 9.6 9.6 9.6 9.7 9.8  
2003 10.0 10.2 10.0 10.2 10.1 10.3 10.3 10.1 10.4 10.2 10.0 9.8  
2004 9.9 9.7 10.0 9.6 9.6 9.5 9.5 9.4 9.4 9.7 9.4 9.2  
2005 9.3 9.3 9.2 9.0 8.9 9.0 8.8 8.9 9.0 8.7 8.7 8.5  
2006 8.4 8.5 8.2 8.1 8.2 8.4 8.5 8.4 8.0 8.2 8.0 7.9  
2007 8.3 8.1 8.0 8.2 8.3 8.3 8.3 8.5 8.4 8.5 8.4 8.7  
2008 9.0 9.0 9.1 9.2 9.8 10.1 10.4 10.9 11.2 12.0 12.6 13.5  
2009 13.9 14.8 15.6 15.8 16.4                

There were more than 25,000,000 Americans unemployed  seeking a full time job in May 2009.

The Obama Depression has the distinction of being the worse depression in U.S. history in terms of the number of unemployed Americans!

Unfortunately, the economy as measured by unemployment has a least six months before it hits bottom towards the end of 2009.

The Good Depression was the 1920-1921 depression–The Harding Depression– that was the shortest in US history and was followed by a booming economy.

The Bad Depression was the 1929-1939 depression–The Great Depreassion– that really ended only after World War II.

The Ugly Depression is the 2009-2010  depression–The Obama Depression– of the radical socialist Democratic Party.

Year Rate Videos

Why You’ve Never Heard of the Great Depression of 1920

Uncommon Knowledge: The Great Depression with Amity Shlaes

Milton Friedman Debunking Myth Of The Great Depression part 1

Milton Friedman Debunking Myth Of The Great Depression part 2

Milton Friedman Debunking Myth Of The Great Depression part 3

80 Years Later: Parallels Between 1929 and 2009

A Recipe for the Next Great Depression

A Recipe for the Next Great Depression

In-Depth Look – US Unemployment Rate – Bloomberg

In-Depth Look – Europe’s Troubles Could Spill To US – Bloomberg

In-Depth Look – Employment Picture – Bloomberg

1920 5.2 %
1928 4.2
1930 8.7
1932 23.6
1934 21.7
1936 16.9
1938 19.0
1940 14.6
1942 4.7%
1944 1.2
1946 3.9
1948 3.8
1950 5.3
1952 3.0
1954 5.5
1956 4.1
1958 6.8%
1960 5.5
1962 5.5
1964 5.2
1966 3.8
1968 3.6
1970 4.9
1972 5.6
1974 5.6%
1976 7.7
19781 6.1
1980 7.1
1982 9.7
1984 7.5
19861 7.0
1987 6.2
1988 5.5
1989 5.3
19901 5.6%
1991 6.8
1992 7.5
1993 6.9
19941 6.1
1995 5.6
1996 5.4
19971 4.9
19981 4.5
19991 4.2
20001 4.0
2001 4.7
2002 5.8
20031 6.0%
20041 5.5
20051 5.1
2006 4.6
2007 4.6

NOTES: Estimates prior to 1940 are based on sources other than direct enumeration.
Data prior to 1948 are for persons age 14 and over. Data beginning in 1948 are for persons age 16 and over.
1. Not strictly comparable with prior years.
2. Beginning in Jan. 2006, data are not strictly comparable with data for 2005 and earlier years because of the revisions in the population controls used in the household survey.
Source: U.S. Department of Labor, Bureau of Labor Statistics. Web: .

The time is long past due to stop the reckless government spending for bailouts, payoffs, and handouts.

The time is long past due to stop unbalanced budgets with massive deficits resulting in a huge national debt.

The time is long past due to stop more new taxes to pay for governement  spending and deficits.

The time is long past due to stop the fiscally irresponsible professional politicians of both political parties by voting them out of office.

Stop The Spending and Deficits

US Federal Government Deficits


Stop Spending Our Future – The Crisis

Daniel J. Mitchell – USA: Drowning In Debt?

Stop The Cap and Trade Carbon Dioxide Energy Tax


You are invited to attend a Tea Party on July 4, 2009, Independence Day!


Join the Second American Revolution


The Meaning of Independence Day

Ayn Rand Center for Individual Rights

Second American Revolution–Tea Party Celebrations–Washington Fair–July 4, 2009–An Open Invitation To The American People

American People’s Plan = 6 Month Tax Holiday + FairTax = Real Hope + Real Change!–Millions To March On Washington D.C. Saturday, July 4, 2009!

Independents Lead The The Second American Revolution Surge–Independence Day–Saturday July 4, 2009 In Washington D.C.–Tea Party Time–On To Washington–Dare You To Move!

Please Spread The Message of Liberty


Proclaim liberty throughout the land to all its inhabitants.”

Let Freedom Ring

Thomas Paine on to Washington

switchfoot-dare you to move(live)

God Bless the USA – Lee Greenwood

“Permanent mass unemployment destroys the moral foundations of the social order. The young people, who, having finished their training for work, are forced to remain idle, are the ferment out of which the most radical political movements are formed. In their ranks the soldiers of the coming revolutions are recruited.”

~Ludwig von Mises, Socialism, page 440

Background Articles and Videos

How The Government Measures Unemployment

“…People with jobs are employed.
People who are jobless, looking for jobs, and available for work are unemployed.
People who are neither employed nor unemployed are not in the labor force.

“…To summarize, employed persons are:
− All persons who did any work for pay or profit during the survey reference
− All persons who did at least 15 hours of unpaid work in a family-owned
enterprise operated by someone in their household.
− All persons who were temporarily absent from their regular jobs because
of illness, vacation, bad weather, industrial dispute, or various personal
reasons, whether or not they were paid for the time off.
Unemployed persons are:
− All persons who did not have a job at all during the survey reference
week, made at least one specific active effort to find a job during the prior
4 weeks, and were available for work (unless temporarily ill).
− All persons who were not working and were waiting to be called back to a
job from which they had been laid off (they need not be looking for work
to be classified as unemployed). …”

“…Yes, there is only one official definition of unemployment, and that was discussed above.
However, some have argued that this measure is too restricted, and that it does not
adequately capture the breadth of labor market problems. For this reason, economists at
BLS developed a set of alternative measures of labor underutilization. These measures
are published every month in the Employment Situation news release. They range from a
very limited measure that includes only those who have been unemployed (as officially
defined) for 15 weeks or more to a very broad one that includes total unemployed (as
officially defined), all persons marginally attached to the labor force, and all individuals
employed part time for economic reasons.

Because of the complexities of the American economic system and the wide variety of
job arrangements and jobseeking efforts, the definitions of employment and
unemployment must be specific to ensure uniformity of reporting at any given time and
over any period of time. When all of the details are considered, definitions may seem
rather complicated. The basic concepts, however, remain little changed: People with
jobs are employed, people who do not have jobs and are looking for jobs are
unemployed, and people who meet neither labor market test are not in the labor force.

The qualifying conditions are necessary to cover the wide range of labor force patterns
and to provide an objective set of standards for consistent treatment of cases.
Where can people find the data?
Each month, summary statistics on unemployment and employment are published in a
news release titled The Employment Situation.
Detailed information also is published in tables online and in a periodical called
Employment and Earnings.
On an irregular basis, special labor force topics are addressed in articles published in the
Monthly Labor Review, in a series of briefs called Issues in Labor Statistics, in a variety
of special reports, and in other BLS publications. …”

Table A-12. Alternative measures of labor underutilization (Percent)

 Not seasonally adjusted                   Seasonally adjusted                 


                                                            May      Apr.     May      May      Jan.     Feb.     Mar.     Apr.     May
                                                            2008     2009     2009     2008     2009     2009     2009     2009     2009  

  U-1 Persons unemployed 15 weeks or longer, as a percent
       of the civilian labor force.......................    1.8      4.5      4.6      1.8      3.0      3.4      3.7      4.0      4.5  

  U-2 Job losers and persons who completed temporary
       jobs, as a percent of the civilian labor force....    2.6      5.6      5.8      2.8      4.5      5.0      5.4      5.7      6.2  

  U-3 Total unemployed, as a percent of the civilian
       labor force (official unemployment rate)..........    5.2      8.6      9.1      5.5      7.6      8.1      8.5      8.9      9.4  

  U-4 Total unemployed plus discouraged workers, as a
       percent of the civilian labor force plus
       discouraged workers...............................    5.5      9.0      9.5      5.8      8.0      8.5      8.9      9.3      9.8  

  U-5 Total unemployed, plus discouraged workers, plus
       all other marginally attached workers, as a
       percent of the civilian labor force plus all
       marginally attached workers.......................    6.1      9.8     10.3      6.4      8.8      9.3      9.8     10.1     10.6  

  U-6 Total unemployed, plus all marginally attached
       workers, plus total employed part time for
       economic reasons, as a percent of the civilian
       labor force plus all marginally attached workers..    9.4     15.4     15.9      9.8     13.9     14.8     15.6     15.8     16.4  

   NOTE:  Marginally attached workers are persons who currently are neither working nor looking for work but indicate that they want and
 are available for a job and have looked for work sometime in the recent past.  Discouraged workers, a subset of the marginally attached,
 have given a job-market related reason for not looking currently for a job.  Persons employed part time for economic reasons are those
 who want and are available for full-time work but have had to settle for a part-time schedule.  For more information, see "BLS
 introduces new range of alternative unemployment measures," in the October 1995 issue of the Monthly Labor Review.  Updated population
 controls are introduced annually with the release of January data.

Employment Situation

Table of Contents

Labor Force Statistics from the Current Population Survey
Series Id:           LNS13000000
Seasonal Adjusted
Series title:        (Seas) Unemployment Level
Labor force status:  Unemployed
Type of data:        Number in thousands
Age:                 16 years and over
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Annual
1948 2034 2328 2399 2386 2118 2214 2213 2350 2302 2259 2285 2429  
1949 2596 2849 3030 3260 3707 3776 4111 4193 4049 4916 3996 4063  
1950 4026 3936 3876 3575 3434 3367 3120 2799 2774 2625 2589 2639  
1951 2305 2117 2125 1919 1856 1995 1950 1933 2067 2194 2178 1960  
1952 1972 1957 1813 1811 1863 1884 1991 2087 1936 1839 1743 1667  
1953 1839 1636 1647 1723 1596 1607 1660 1665 1821 1974 2211 2818  
1954 3077 3331 3607 3749 3767 3551 3659 3854 3927 3666 3402 3196  
1955 3157 2969 2918 3049 2747 2701 2632 2784 2678 2830 2780 2761  
1956 2666 2606 2764 2650 2861 2882 2952 2701 2635 2571 2861 2790  
1957 2796 2622 2509 2600 2710 2856 2796 2747 2943 3020 3454 3476  
1958 3875 4303 4492 5016 5021 4944 5079 5025 4821 4570 4188 4191  
1959 4068 3965 3801 3571 3479 3429 3528 3588 3775 3910 4003 3653  
1960 3615 3329 3726 3620 3569 3766 3836 3946 3884 4252 4330 4617  
1961 4671 4832 4853 4893 5003 4885 4928 4682 4676 4573 4295 4177  
1962 4081 3871 3921 3906 3863 3844 3819 4013 3961 3803 4024 3907  
1963 4074 4238 4072 4055 4217 3977 4051 3878 3957 3987 4151 3975  
1964 4029 3932 3950 3918 3764 3814 3608 3655 3712 3726 3551 3651  
1965 3572 3730 3510 3595 3432 3387 3301 3254 3216 3143 3073 3031  
1966 2988 2820 2887 2828 2950 2872 2876 2900 2798 2798 2770 2912  
1967 2968 2915 2889 2895 2929 2992 2944 2945 2958 3143 3066 3018  
1968 2878 3001 2877 2709 2740 2938 2883 2768 2686 2689 2715 2685  
1969 2718 2692 2712 2758 2713 2816 2868 2856 3040 3049 2856 2884  
1970 3201 3453 3635 3797 3919 4071 4175 4256 4456 4591 4898 5076  
1971 4986 4903 4987 4959 4996 4949 5035 5134 5042 4954 5161 5154  
1972 5019 4928 5038 4959 4922 4923 4913 4939 4849 4875 4602 4543  
1973 4326 4452 4394 4459 4329 4363 4305 4305 4350 4144 4396 4489  
1974 4644 4731 4634 4618 4705 4927 5063 5022 5437 5523 6140 6636  
1975 7501 7520 7978 8210 8433 8220 8127 7928 7923 7897 7794 7744  
1976 7534 7326 7230 7330 7053 7322 7490 7518 7380 7430 7620 7545  
1977 7280 7443 7307 7059 6911 7134 6829 6925 6751 6763 6815 6386  
1978 6489 6318 6337 6180 6127 6028 6309 6080 6125 5947 6077 6228  
1979 6109 6173 6109 6069 5840 5959 5996 6320 6190 6296 6238 6325  
1980 6683 6702 6729 7358 7984 8098 8363 8281 8021 8088 8023 7718  
1981 8071 8051 7982 7869 8174 8098 7863 8036 8230 8646 9029 9267  
1982 9397 9705 9895 10244 10335 10538 10849 10881 11217 11529 11938 12051  
1983 11534 11545 11408 11268 11154 11246 10548 10623 10282 9887 9499 9331  
1984 9008 8791 8746 8762 8456 8226 8537 8519 8367 8381 8198 8358  
1985 8423 8321 8339 8395 8302 8460 8513 8196 8248 8298 8128 8138  
1986 7795 8402 8383 8364 8439 8508 8319 8135 8310 8243 8159 7883  
1987 7892 7865 7862 7542 7574 7398 7268 7261 7102 7227 7035 6936  
1988 6953 6929 6876 6601 6779 6546 6605 6843 6604 6568 6537 6518  
1989 6682 6359 6205 6468 6375 6577 6495 6511 6590 6630 6725 6667  
1990 6752 6651 6598 6797 6742 6590 6922 7188 7368 7459 7764 7901  
1991 8015 8265 8586 8439 8736 8692 8586 8666 8722 8842 8931 9198  
1992 9283 9454 9460 9415 9744 10040 9850 9787 9781 9398 9565 9557  
1993 9325 9183 9056 9110 9149 9121 8930 8763 8714 8750 8542 8477  
1994 8630 8583 8470 8331 7915 7927 7946 7933 7734 7632 7375 7230  
1995 7375 7187 7153 7645 7430 7427 7527 7484 7478 7328 7426 7423  
1996 7491 7313 7318 7415 7423 7095 7337 6882 6979 7031 7236 7253  
1997 7158 7102 7000 6873 6655 6799 6655 6608 6656 6454 6308 6476  
1998 6368 6306 6422 5941 6047 6212 6259 6179 6300 6280 6100 6032  
1999 5976 6111 5783 6004 5796 5951 6025 5838 5915 5778 5716 5653  
2000 5708 5858 5733 5481 5758 5651 5747 5853 5625 5534 5639 5634  
2001 6023 6089 6141 6271 6226 6484 6583 7042 7142 7694 8003 8258  
2002 8182 8215 8304 8599 8399 8393 8390 8304 8251 8307 8520 8640  
2003 8520 8618 8588 8842 8957 9266 9011 8896 8921 8732 8576 8317  
2004 8370 8167 8491 8170 8212 8286 8136 7990 7927 8061 7932 7934  
2005 7759 7972 7740 7683 7672 7551 7415 7360 7570 7457 7541 7219  
2006 7020 7176 7080 7142 7028 7039 7167 7118 6874 6738 6837 6688  
2007 7029 6887 6737 6874 6844 7028 7128 7123 7221 7295 7212 7541  
2008 7555 7423 7820 7675 8536 8662 8910 9550 9592 10221 10476 11108  
2009 11616 12467 13161 13724 14511                

America’s Greatest Depression Fighter

(No, it wasn’t Franklin Delano Roosevelt)


by Jim Powell

“…A depression not only harms millions of people. It leads to intense political pressure for more government spending, higher taxes and other assaults on economic liberty. So it’s important to get through a depression as quickly as possible. Which U.S. president ranks as the best depression fighter?

Not the fabled Franklin Delano Roosevelt, who came to power in 1933, since the Great Depression persisted until the federal government conscripted some 12 million men into the armed forces. Biographers and political historians hail FDR’s charismatic personality, his “Fireside Chats” and his political genius, but his tripling of taxes, his laws making it more expensive for employers to hire people, his anti-discounting laws, his large-scale destruction of food, the 700 industrial cartels he enforced, the monopolies he established, the frivolous antitrust lawsuits he authorized against big employers – these and other measures throttled recovery and prolonged unemployment averaging 17%.

America’s greatest depression fighter was Warren Gamaliel Harding. An Ohio senator when he was elected president in 1920, he followed Woodrow Wilson who got America into World War I, contributed to the deaths of 116,708 Americans, built up huge federal bureaucracies, imprisoned dissenters and incurred $25 billion of debt, for which he has been much praised by historians.

Harding inherited the mess, in particular the post-World War I depression – almost as severe, from peak to trough, as the Great Contraction from 1929 to 1933, that FDR inherited and prolonged. Richard K. Vedder and Lowell E. Gallaway, in their book Out of Work (1993), noted that the magnitude of the 1920 depression “exceeded that for the Great Depression of the following decade for several quarters.” The estimated gross national product plunged 24% from $91.5 billion in 1920 to $69.6 billion in 1921. The number of unemployed people jumped from 2.1 million in 1920 to 4.9 million in 1921. …”

“…Federal spending was cut from $6.3 billion in 1920 to $5 billion in 1921 and $3.2 billion in 1922. Federal taxes were cut from $6.6 billion in 1920 to $5.5 billion in 1921 and $4 billion in 1922. Harding’s policies started a trend. The low point for federal taxes was reached in 1924. For federal spending, in 1925. The federal government paid off debt, which had been $24.2 billion in 1920, and it continued to decline until 1930.

Conspicuously absent was business-bashing that became a hallmark of FDR’s speeches. Absent, too, were New Deal–type big government programs to make it more expensive for employers to hire people, to force prices above market levels, to promote cartels and monopolies. Frederick Lewis Allen wrote, “Business itself was regarded with a new veneration. Once it had been considered less dignified and distinguished than the learned professions, but now people thought they praised a clergyman highly when they called him a good business man.”

With Harding’s tax cuts, spending cuts and relatively non-interventionist economic policy, the gross national product rebounded to $74.1 billion in 1922. The number of unemployed fell to 2.8 million – a reported 6.7% of the labor force – in 1922. So, just a year and a half after Harding became president, the Roaring 20s were underway! The unemployment rate continued to decline, reaching a low of 1.8% in 1926 – an extraordinary feat. Since then, the unemployment rate has been lower only once in wartime (1944), and never in peacetime.

“The seven years from the autumn of 1922 to the autumn of 1929,” wrote Vedder and Gallaway, “were arguably the brightest period in the economic history of the United States. Virtually all the measures of economic well-being suggested that the economy had reached new heights in terms of prosperity and the achievement of improvements in human welfare. Real gross national product increased every year, consumer prices were stable (as measured by the consumer price index), real wages rose as a consequence of productivity advance, stock prices tripled. Automobile production in 1929 was almost precisely double the level of 1922. It was in the twenties that Americans bought their first car, their first radio, made their first long-distance telephone call, took their first out-of-state vacation. This was the decade when America entered ‘the age of mass consumption.’”

Warren Harding made additional contributions to liberty. In 1922, he nominated George Sutherland to the Supreme Court – and Sutherland went on to become one of the greatest champions of liberty who ever served there. The next year, Harding nominated Pierce Butler. These were to be two of the “Four Horsemen of Reaction” who, during the 1930s, courageously struck down FDR’s early New Deal legislation that had been suppressing recovery….”

“…Harding suffered a stroke and died in San Francisco on August 2, 1923. “At the time of his death, no president was more popular and admired,” John W. Dean wrote in his biography of Harding. Harding’s body was returned to Washington on a funeral train. According to Dean, “This trip, reported in every newspaper in the land, resulted in a public outpouring of sentiment the likes of which had not been experienced by the nation since the death of Abraham Lincoln, and would not occur again until the death of Franklin Roosevelt. An estimated 9 million people from factories and farms, schools and shops, in the cities and in the fields, spontaneously appeared along the railroad tracks to silently – and often in tears – pay last respects to a president they admired, a friend they’d lost.”

Unfortunately, Harding’s stunning success as a depression fighter was overshadowed by the Teapot Dome scandal that engulfed his administration after he died. This resulted from “progressive” era conservation policies in which the government owned land known to have petroleum reserves, at Teapot Dome, Wyoming and Elk Hills, California. Since the beginnings of recorded history, government involvement in the economy has always led to corruption, and Secretary of the Interior Albert Fall accepted bribes for leases enabling private companies to extract the oil. If the reserves had been privately owned, there wouldn’t have been a scandal….”

What was the unemployment rate during the Great Depression?

“…The unemployment rate for the years 1923-29 was 3.3 percent. In 1931 it jumped to 15.9, in 1933 it was 24.9 percent. It then steadily decreased until 1941 when it stood at 9.9%. In 1942, after U.S. entry into World War II, the rate dropped to 4.7%.


“…When trying to compare historical and contemporary employment and unemployment rates, it is important to note that US employment and unemployment figures (and there are multiple official employment and unemployment figures for the same time period, just as there are multiple official rates of inflation, depending on exactly what is being looked at) are now calculated differently than they were during the 1930s and 1940s. In general, current unemployment numbers would be between 5% and 10% higher if calculated in the same way as in the past; conversely, the numbers from the 1930s and 1940s would be 5% – 10% lower if calculated using our contemporary methods. One, but not the only, major change is that workers are no longer considered “unemployed” if they become discouraged after being unable to find a job and stop searching. These workers disappear from the numbers.

Employment and unemployment figures are also difficult to compare, since they are typically calculated differently. For example, official employment and unemployment numbers may go up at the same time, which is illogical if we think that these numbers are based on the same formula. …”

Great Depression

by Gene Smiley

“…A worldwide depression struck countries with market economies at the end of the 1920s. Although the Great Depression was relatively mild in some countries, it was severe in others, particularly in the United States, where, at its nadir in 1933, 25 percent of all workers and 37 percent of all nonfarm workers were completely out of work. Some people starved; many others lost their farms and homes. Homeless vagabonds sneaked aboard the freight trains that crossed the nation. Dispossessed cotton farmers, the “Okies,” stuffed their possessions into dilapidated Model Ts and migrated to California in the false hope that the posters about plentiful jobs were true. Although the U.S. economy began to recover in the second quarter of 1933, the recovery largely stalled for most of 1934 and 1935. A more vigorous recovery commenced in late 1935 and continued into 1937, when a new depression occurred. The American economy had yet to fully recover from the Great Depression when the United States was drawn into World War II in December 1941. Because of this agonizingly slow recovery, the entire decade of the 1930s in the United States is often referred to as the Great Depression. …”

“…It is commonly argued that World War II provided the stimulus that brought the American economy out of the Great Depression. The number of unemployed workers declined by 7,050,000 between 1940 and 1943, but the number in military service rose by 8,590,000. The reduction in unemployment can be explained by the draft, not by the economic recovery. The rise in real GNP presents similar problems. Most estimates show declines in real consumption spending, which means that consumers were worse off during the war. Business investment fell during the war. Government spending on the war effort exceeded the expansion in real GNP. These figures are suspect, however, because we know that government estimates of the value of munitions spending, to name one major area, were increasingly exaggerated as the war progressed. In fact, the extensive price controls, rationing, and government control of production render data on GNP, consumption, investment, and the price level less meaningful. How can we establish a consistent price index when government mandates eliminated the production of most consumer durable goods? What does the price of, say, gasoline mean when it is arbitrarily held at a low level and gasoline purchases are rationed to address the shortage created by the price controls? What does the price of new tires mean when no new tires are produced for consumers? For consumers, the recovery came with the war’s end, when they could again buy products that were unavailable during the war and unaffordable during the 1930s. …”

U.S. Labor Force Trends


List of recessions in the United States

Recessions and other Economic Crises

Name  ↓ Dates  ↓ Duration  ↓ Time since start of previous entry  ↓ Causes References
Panic of 1797 1797–1800 &0000000000000003.0000003 years The effects of the deflation of the Bank of England crossed the Atlantic Ocean to North America and disrupted commercial and real estate markets in the United States and the Caribbean. Britain‘s economy was greatly affected by developing disflationary repercussions because it was fighting France in the French Revolutionary Wars at the time. [9] [5]
Depression of 1807 1807–1814 &0000000000000007.0000007 years &0000000000000010.00000010 years The Embargo Act of 1807 was passed by the United States Congress under President Thomas Jefferson. It devastated shipping-related industries. The Federalists fought the embargo and allowed smuggling to take place in New England. [10][11][5]
Panic of 1819 1819–1824 &0000000000000005.0000005 years &0000000000000012.00000012 years The first major financial crisis in the United States featured widespread foreclosures, bank failures, unemployment, and a slump in agriculture and manufacturing. It also marked the end of the economic expansion that followed the War of 1812. [12][13][5]
Panic of 1837 1837–1843 &0000000000000006.0000006 years &0000000000000018.00000018 years A sharp downturn in the American economy was caused by bank failures and lack of confidence in the paper currency. Speculation markets were greatly affected when American banks stopped payment in specie (gold and silver coinage). [14][5]
Panic of 1857 1857–1860 &0000000000000003.0000003 years &0000000000000020.00000020 years Failure of the Ohio Life Insurance and Trust Company burst a European speculative bubble in United States railroads and caused a loss of confidence in American banks. Over 5,000 businesses failed within the first year of the Panic, and unemployment was accompanied by protest meetings in urban areas. [15][5]
Panic of 1873 1873–1879 &0000000000000006.0000006 years &0000000000000016.00000016 years Economic problems in Europe prompted the failure of the Jay Cooke & Company, the largest bank in the United States, which burst the post-Civil War speculative bubble. The Coinage Act of 1873 also contributed by immediately depressing the price of silver, which hurt North American mining interests. [16][5]
Long Depression 1873–1896 &0000000000000023.00000023 years The collapse of the Vienna Stock Exchange caused a depression that spread throughout the world. It is important to note that during this period, the global industrial production greatly increased. In the United States, for example, industrial output increased fourfold. [17][5]
Panic of 1893 1893–1896 &0000000000000003.0000003 years &0000000000000020.00000020 years Failure of the United States Reading Railroad and withdrawal of European investment led to a stock market and banking collapse. This Panic was also precipitated in part by a run on the gold supply. [18][5]
Panic of 1907 1907–1908 &0000000000000001.0000001 year &0000000000000014.00000014 years A run on Knickerbocker Trust Company deposits on October 22, 1907, set events in motion that would lead to a severe monetary contraction. [19][5]
Post-World War I recession 1918–1921 &0000000000000003.0000003 years &0000000000000011.00000011 years Severe hyperinflation in Europe took place over production in North America. It was a brief but very sharp recession and was caused by the end of wartime production, along with an influx of labor from returning troops. This in turn caused high unemployment. [20][5]
Great Depression 1929–1933 &0000000000000043.00000043 months &0000000000000021.00000021 months Stock markets crashed worldwide, and a banking collapse took place in the United States. Although sometimes dated as lasting until the Second World War, the US economy was growing again by 1933, and technically the U.S. was not in recession from 1933 to 1937 [21][5]
Recession of 1937 1937–1938 &0000000000000013.00000013 months &0000000000000050.00000050 months The Recession of 1937 is only considered minor when compared to the Great Depression, but is otherwise among the worst recessions of the 20th century. [22]
Recession of 1945 Feb-Oct 1945 &0000000000000008.0000008 months &0000000000000080.00000080 months The decline in government spending at the end of World War II led to an enormous drop in Gross Domestic Product making this technically a recession. The Post War years were unusual in a number of ways and this era has little in common with other recessions. [23]
Recession of 1948 Nov 1948–Oct 1949 &0000000000000011.00000011 months &0000000000000037.00000037 months The 1948 recession was a relatively brief cyclical economic downturn, the mildness of which led to confidence in the notion that the Post War-era would be a period of stronger growth. [24]
Recession of 1953 July 1953–May 1954 &0000000000000010.00000010 months &0000000000000045.00000045 months After a post-Korean War inflationary period, more funds were transferred into national security. The Federal Reserve changed monetary policy to be more restrictive in 1952 due to fears of further inflation. [25][26][5]
Recession of 1958 Aug 1957–April 1958 &0000000000000008.0000008 months &0000000000000039.00000039 months Monetary policy was tightened during the two years preceding 1957, followed by an easing of policy at the end of 1957. The budget balance resulted in a change in budget surplus of 0.8% of GDP in 1957 to a budget deficit of 0.6% of GDP in 1958, and then to 2.6% of GDP in 1959. [27][5]
Recession of 1960-1 April 1960–Feb 1961 &0000000000000010.00000010 months &0000000000000024.00000024 months After President Kennedy’s 30 January 1961 call for increased government spending to improve the Gross National Product and to reduce unemployment, the 1960-61 recession ended in February.[28]
Recession of 1969-70 Dec 1969–Nov 1970 &0000000000000011.00000011 months &0000000000000106.000000106 months The relatively mild 1969 recession is thought to have been mostly caused by the Federal Reserve raising interest rates to hold down inflation. [5]
1973 oil crisis1973–1974 stock market crash Nov. 1973– March 1975 &0000000000000016.00000016 months &0000000000000036.00000036 months A quadrupling of oil prices by OPEC coupled with high government spending due to the Vietnam War led to stagflation in the United States. [29][5]
1980 recession Jan-July 1980 &0000000000000006.0000006 months &0000000000000058.00000058 months The NBER considers a short recession to have occurred in 1980, followed by a short period of growth and then a deep recession. Unemployment remained relatively elevated inbetween recessions. The early ’80s are sometimes referred to as a “double dip” or “w-shaped” recession. [5]
Early 1980s recession July 1981–Nov 1982 &0000000000000016.00000016 months &0000000000000012.00000012 months The Iranian Revolution sharply increased the price of oil around the world in 1979, causing the 1979 energy crisis. This was caused by the new regime in power in Iran, which exported oil at inconsistent intervals and at a lower volume, forcing prices to go up. Tight monetary policy in the United States to control inflation led to another recession. The changes were made largely because of inflation that was carried over from the previous decade due to the 1973 oil crisis and the 1979 energy crisis. [30][31][5]
Early 1990s recession July 1990–March 1991 &0000000000000008.0000008 months &0000000000000092.00000092 months Industrial production and manufacturing-trade sales increased in early 1991. [32][5]
Early 2000s recession Mar-Nov 2001 &0000000000000008.0000008 months &0000000000000120.000000120 months The collapse of the dot-com bubble, the September 11th attacks, and accounting scandals contributed to a relatively mild contraction in the North American economy. [33][5]
Late 2000s recession Dec 2007-current ongoing &0000000000000073.00000073 months The collapse of the housing market led to bank collapses in the US and Europe, causing the amount of available credit to be sharply curtailed, resulting in huge liquidity and solvency crises. In addition, record oil prices and food prices, stock markets crashed globally, and several high profile banking, automotive, and manufacturing giants collapsed in the United States [34][35]

Economic Depressions: Their Cause and Cure

by Murray N. Rothbard

“…Thus, the Misesian theory of the business cycle accounts for all of our puzzles: The repeated and recurrent nature of the cycle, the massive cluster of entrepreneurial error, the far greater intensity of the boom and bust in the producers’ goods industries.

Mises, then, pinpoints the blame for the cycle on inflationary bank credit expansion propelled by the intervention of government and its central bank. What does Mises say should be done, say by government, once the depression arrives? What is the governmental role in the cure of depression? In the first place, government must cease inflating as soon as possible. It is true that this will, inevitably, bring the inflationary boom abruptly to an end, and commence the inevitable recession or depression. But the longer the government waits for this, the worse the necessary readjustments will have to be. The sooner the depression-readjustment is gotten over with, the better. This means, also, that the government must never try to prop up unsound business situations; it must never bail out or lend money to business firms in trouble. Doing this will simply prolong the agony and convert a sharp and quick depression phase into a lingering and chronic disease. The government must never try to prop up wage rates or prices of producers’ goods; doing so will prolong and delay indefinitely the completion of the depression-adjustment process; it will cause indefinite and prolonged depression and mass unemployment in the vital capital goods industries. The government must not try to inflate again, in order to get out of the depression. For even if this reinflation succeeds, it will only sow greater trouble later on. The government must do nothing to encourage consumption, and it must not increase its own expenditures, for this will further increase the social consumption/investment ratio. In fact, cutting the government budget will improve the ratio. What the economy needs is not more consumption spending but more saving, in order to validate some of the excessive investments of the boom.

Thus, what the government should do, according to the Misesian analysis of the depression, is absolutely nothing. It should, from the point of view of economic health and ending the depression as quickly as possible, maintain a strict hands off, “laissez-faire” policy. Anything it does will delay and obstruct the adjustment process of the market; the less it does, the more rapidly will the market adjustment process do its work, and sound economic recovery ensue.

The Misesian prescription is thus the exact opposite of the Keynesian: It is for the government to keep absolute hands off the economy and to confine itself to stopping its own inflation and to cutting its own budget.

If Coolidge made 1929 inevitable, it was President Hoover who prolonged and deepened the depression, transforming it from a typically sharp but swiftly-disappearing depression into a lingering and near-fatal malady, a malady “cured” only by the holocaust of World War II. Hoover, not Franklin Roosevelt, was the founder of the policy of the “New Deal”: essentially the massive use of the State to do exactly what Misesian theory would most warn against – to prop up wage rates above their free-market levels, prop up prices, inflate credit, and lend money to shaky business positions. Roosevelt only advanced, to a greater degree, what Hoover had pioneered. The result for the first time in American history, was a nearly perpetual depression and nearly permanent mass unemployment. The Coolidge crisis had become the unprecedentedly prolonged Hoover-Roosevelt depression.

Ludwig von Mises had predicted the depression during the heyday of the great boom of the 1920s – a time, just like today, when economists and politicians, armed with a “new economics” of perpetual inflation, and with new “tools” provided by the Federal Reserve System, proclaimed a perpetual “New Era” of permanent prosperity guaranteed by our wise economic doctors in Washington. Ludwig von Mises, alone armed with a correct theory of the business cycle, was one of the very few economists to predict the Great Depression, and hence the economic world was forced to listen to him with respect. F. A. Hayek spread the word in England, and the younger English economists were all, in the early 1930s, beginning to adopt the Misesian cycle theory for their analysis of the depression – and also to adopt, of course, the strictly free-market policy prescription that flowed with this theory. Unfortunately, economists have now adopted the historical notion of Lord Keynes: That no “classical economists” had a theory of the business cycle until Keynes came along in 1936. There was a theory of the depression; it was the classical economic tradition; its prescription was strict hard money and laissez-faire; and it was rapidly being adopted, in England and even in the United States, as the accepted theory of the business cycle. (A particular irony is that the major “Austrian” proponent in the United States in the early and mid-1930s was none other than Professor Alvin Hansen, very soon to make his mark as the outstanding Keynesian disciple in this country.)

What swamped the growing acceptance of Misesian cycle theory was simply the “Keynesian Revolution” – the amazing sweep that Keynesian theory made of the economic world shortly after the publication of the General Theory in 1936. It is not that Misesian theory was refuted successfully; it was just forgotten in the rush to climb on the suddenly fashionable Keynesian bandwagon. Some of the leading adherents of the Mises theory – who clearly knew better – succumbed to the newly established winds of doctrine, and won leading American university posts as a consequence.

But now the once arch-Keynesian London Economist has recently proclaimed that “Keynes is Dead.” After over a decade of facing trenchant theoretical critiques and refutation by stubborn economic facts, the Keynesians are now in general and massive retreat. Once again, the money supply and bank credit are being grudgingly acknowledged to play a leading role in the cycle. The time is ripe – for a rediscovery, a renaissance, of the Mises theory of the business cycle. It can come none too soon; if it ever does, the whole concept of a Council of Economic Advisors would be swept away, and we would see a massive retreat of government from the economic sphere. But for all this to happen, the world of economics, and the public at large, must be made aware of the existence of an explanation of the business cycle that has lain neglected on the shelf for all too many tragic years. …”

1929 – The Great Wall Street Crash & Depression: Part 1 of 6

1929 – The Great Wall Street Crash & Depression: Part 2 of 6

1929 – The Great Wall Street Crash & Depression: Part 3 of 6

1929 – The Great Wall Street Crash & Depression: Part 4 of 6

1929 – The Great Wall Street Crash & Depression: Part 5 of 6

1929 – The Great Wall Street Crash & Depression: Part 6 of 6

Prediction On US Dollar – Bloomberg

Neel Kashkari on the Financial Crisis: “Our Nation will Emerge Stronger”

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Fred Thompson On Borrowing and Spending–Yes We Can!

Posted on January 3, 2009. Filed under: Blogroll, Economics, Employment, Investments, Law, Links, Politics, Quotations, Raves, Regulations, Taxes, Video | Tags: , , , , , , , , , , , , , , , |

Trying to fix problems caused by excess consumption with more spending is like telling a fat guy that the way to lose weight is to eat more donuts.

~Fred Thompson


Fred Thompson on the Economy


Great video!

Ask not what your country can spend on you, ask what you can spend for your country. Is that what made American a great country?

~Fred Thompson


Background Articles and Videos


Postponing Reality

By Thomas Sowell


“…While Detroit’s Big Three are laying off thousands of workers, Toyota is hiring thousands of workers right here in America, where a substantial share of all our Toyotas are manufactured.

Will this save Detroit or Michigan? No.

Detroit and Michigan have followed classic liberal policies of treating businesses as prey, rather than as assets. They have helped kill the goose that lays the golden eggs. So have the unions. So have managements that have gone along to get along.

Toyota, Honda and other foreign automakers are not heading for Detroit, even though there are lots of experienced automobile workers there. They are avoiding the rust belts and the policies that have made those places rust belts.

A bailout of Detroit’s Big Three would be only the latest in the postponements of reality. As for automobile dealers, they can probably sell Toyotas just as easily as they sold Chevvies. And Toyotas will require just as many tires per car, as well as other parts from automobile parts suppliers.”


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