Part of conseratives’ “the worse, the better” strategy is to arouse fear using a steady stream of “the end is neigh” warnings. This requires both imagination and a willingness to exaggerate. As seen when reading Reynold’s and his peers since Obama’s election.
- Hyping every bit of bad economic news. During the Bush years bad news was minimized or mocked (see examples here and here).
- Exaggerating threads. From Iran. Looming Inflation. Busted government finances. To our Constitution.
- Rather than long-term dangers, building over decades, these are typically described as suddenly appearing — hence Obama’s fault.
While these are all real dangers, this campaign to incited panic mirrors the Left’s agitprop about global warming (it even causes earthquakes). How odd that neither side sees how alike they are.
Today’s example is from Glenn Reynolds’ website, the Instapundit:
DON SURBER: “The federal government now pays more to borrow money (3.93%) than I do on my mortgage (3.375%). I have better credit.”
Surber’s statement at The Daily Mail that he has better credit than the US government is obviously absurd, and should set off anyone’s bs alarm. First, as of February 2010, per the Government’s website the cost of financing the public debt was 2.548%. Lower than Surber’s mortgage. Second, his comparison is apples to oranges. His mortgage is not a 10 year fixed-rate balloon payment loan (the equivalent of a 10 year Treasury bond). What might account for the low interest rate on Surber’s mortgage?
(1) Surber might have an adjustable rate mortgage. So his rate is lower because he (the debtor) bears the risk of rising rates. The creditor bears that risk with a Treasury bond, and gets a higher rate in return. To minimize the risk of rising rates breaking the Treasury, the government sensibly borrows a substantial amount in long-term fixed rate debt.
(2) Perhaps Surber got a great deal on a fixed year mortgage. The standard 15 and 30 year fixed-rates never got that low (in the low 4%s last December), but he might have got a deal. Unfortunately, the Treasury cannot lock in a low rate on the multi-trillion dollar Federal debt.
Update: Do you have better credit than the US government? It’s easily tested. Attempt to borrow a substantial sum (not coffee money) from an unrelated third party (not Mom). Ignored promotions (credit card “deals”, zero-financing on a new car). For example, a loan of several thousand dollars payable in one year. Compare with comperable US treasury rate (adjust for the State tax exemption). Be sure to tell the banker that you expected better terms than the US government. Good luck!
Notes:
- The comments about intent apply to Reynold’s post, not Surber. I don’t read Surber’s website, so I don’t know how or why he wrote this post. It might be just dashed-off folly. That’s easy to do, as I can say from experience — having done so too often on the FM website.
- You should bookmark this: the US government’s debt, today to the penny. Now $8,294,870,658,096.94 (thisis the public debt, not including the fake loans the government makes to itself).
Update
From Glenn Reynolds, the Instapundit: “Fabius Maximus calls Surber a liar.” As you can see from this post, that is false. Wrong about a technical matter hardly means “liar.”
For more information about the US government’s debt
Useful articles:
- Valuable analysis of liabilities of western governments: “Government hedonism and the next policy mistake“, Dylan Grice, Société Générale, 11 February 2010 — Excellent graphics. His forecasts have not been so accurate, however.
- “Where Today’s Large Deficits Come From“, Kathy Ruffing and James R. Horney, Center on Budget and Policy Priorities, 17 February 2010 — “Economic Downturn, Financial Rescues, and Bush-Era Policies Drive the Numbers.”
- “Is a Sovereign Debt Crisis Looming?“, Uri Dadush and Bennett Stancil, International Economic Bulletin, 2 February 2010
From the FM website:
- Forecasts – Why wait? Read tomorrow’s news … today! (part 3), 17 July 2006
- The most important story in this week’s newspapers, 22 May 2008
- Debt – the core problem of this financial crisis, which also explains how we got in this mess, 22 October 2008
- A certain casualty of the recession: the US Government’s solvency, 25 November 2008
- We have been warned. Death of the post-WWII geopolitical regime, 28 November 2008
- Beginning of the end of the Republic’s solvency. Soon come the first steps to a reformed regime – or a new regime., 14 August 2009
- Update on our government’s deteriorating solvency, 1 October 2009
- Another crack in Republic’s foundations: not the size of the debt, but when it’s due, 30 October 2009
- A look at our government’s debt – rising because we like to spend, 29 December 2009
- Why the U.S. cannot inflate its way out of debt, 15 March 2010
- Governments cannot go bankrupt, 2 April 2010
- See the very essence of the US government’s financial problems (clue: it’s us), 2 April 2010
More examples of political propaganda from the FM website
- More attempts to control the climate science debate using smears and swarming, 19 October 2009
- About Wikipedia’s handling of controversial topics…like climate science, 20 December 2009
- Think-tanks bribe journalists to promote our wars, 24 December 2009
- Iran will have the bomb in 5 years (again), 20 January 2010
- Successful propaganda as a characteristic of 21st century America, 1 February 2010
- More propaganda: the eco-fable of Easter Island, 4 February 2010
- The hidden history of the global warming crusade, 19 February 2010
- Dumbest headline of the week, 1 March 2010 — More by Glenn Reynolds
- About the political significance of the conservatives’ health care propaganda, 23 March 2010
Afterword
- For more about this website, see the About the FM website page.
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