Tuesday, July 5, 2016

How Will Spain Handle Busted Social Security?

AS I noted last week, Puerto Rico's politicians decided, when short of credit, to pay current government workers and skip a bond payment, which means retirees etc do not get paid.  OK.  Now check your retirement portfolio.  Got bonds?  Now you know your future.

Spain will run out of Social Security credit in 2018, according to Mish.  Spain must cut spending or hike taxes, as Mish sees it, but that is a false dilemma.  They can always free up the Spanish economy.

1. Deregulate banks. Give the banks no legitimacy from the state, no bank agreements are enforceable by law. Banks must curry full faith and credit with customers on their own.

2.  Free trade.  End all "free trade" agreements, and announce unilaterally all duties and quotas are eliminated on imports, and  as to liability, "the importer is the manufacturer."

3. All government services are voluntary, and the fees charged are directed to state obligations.  State obligations are constrained by what fees are gathered from voluntary payments for its services.

For good measure, all property in Spain reverts to the King, and no one is allowed to own property, any current titles are converted to 99 year leases.

The idea is to clear the decks and let Spaniards prosper.  Give freedom a chance.

Feel free to forward this by email to three of your friends.


Anonymous said...

I wholeheartedly agree with everything that you have written here. If you run for political office I will vote for you.

Anonymous said...

I beg to differ on #1, the consumer must be protected from banks. This means that banks must be held accountable for predatory lending practices as well as outrageous fee charges.

John Wiley Spiers said...

By whom is the consumer to be protected from banks? The regulators? But they are captured by the banks. Predatory lending? The subprime debacle was provided in law and funded by congressional act. Outrageous fee charges? Again, provided for by regulations. We have regulators, laws and so on expressly to achieve the goals we have now. Democracy and capitalism are the evil twins. Are you waiting for a strong man to come and make it all right?

With regulation, competition is eliminated. With deregulation, and delegitimization, comes competition and the consumer can look out for himself. Read 1 Samuel 8 and see how things go for people who beg for a King to fight their battles for them.

(And as to running for office, an anarchist to run for office?)