If Paul Krugman is Your Uncle, Borrow Another Twenty From Him Quick

Mid-term elections are approaching. Democrats will soon be talking about white privilege, rape culture, the high cost of abortions, animal rights and windmills. Anything but the economy and the security of the world. When forced to discuss the economy the story will be that Bush handed them an epic disaster, their quick and thoughtful actions prevented total collapse, and that any remaining pain is solely a result of the rich screwing you, which they work tirelessly to prevent.

The truth is that they were handed an epic disaster that they delayed a few years while creating an even more epic disaster. Far from being the enemies of the rich, the Obama administration has helped them to plunder the next 3 generations. And the middle class continues to collapse.

Unemployment rates are easy to game. Let’s look at the percentage of people who are working. The increase starting in the 60s corresponds to both a growing real economy and women entering the workforce. The decline starting in the late 90s corresponds to Chinese labor competition, and later, the collapse of the housing bubble followed by financial manipulation on a grand scale. The trend is sharply down now.

Percentage of People with Jobs


Democrats like to tell you that all pain is the result of the government not “doing enough”. A chart of historical taxes and spending shows that the government has never done more. Indeed the government grows pretty much nonstop, including through the Regan “small government years”. But the real growth has come over the Bush 2 and Obama administrations.

Yet the job situation is dire.

Perhaps government can’t create jobs, at least with financial manipulation.

Receipts (blue), Spending (red) and Deficit/Surplus (green)


Perhaps it was the war. We’d be in great shape if we didn’t waste all the treasure on war.

Medicare (blue), Social Security (orange), Military (grey), Treasury (yellow)


The military is one of three big ticket items, the other being Medicare and social security. Obamacare and interest on the debt will be the fourth and fifth in future years. Or more correctly they would be if there were any conceivable way to actually fund these things at the levels promised and expected. Which there is not.

But this chart also tells us that military spending doesn’t change all that much from administration to administration, hasn’t grown nearly as fast as Medicare and social security, and would have to be taken nearly to zero to offset growth in other spending.

It’s interesting to look at the impact of the 2013 budget sequestration. You might remember that as the time when national parks were being closed because of deep budget cuts. Or so we were told.

Of course these charts don’t reflect the fact that underlying economy is growing over the long term. The government should collect more tax and spend more because there is more real wealth. This chart shows taxes and spending as a percentage of GDP.

Receipts (blue), Spending (red) and Deficit/Surplus (green) as % of GDP


This chart is certainly not as scary as the first one. But when you run a deficit for many years, the total debt grows quite substantially:

Holy Shit


Politicians, economists, the New York Times and other liars like to explain that government debt is “different”. Especially US government debt. Unlike the $20 you borrowed from your uncle and the debt that that is causing sky high taxes and job loss in European social democracies like Greece, we don’t have to pay ours back.

We can just keep borrowing forever.

We’re different.

Only the ignorant and uncaring would object to this. Remember the debt ceiling showdown? Democrats are deeply caring folks who only want to preserve parks, and the GOP wants the government to default because the rich would benefit. Somehow.


The Obama administration has inadvertently undermined the intellectuals explanation for magic debt by borrowing so much that it is now easy to model why this will end badly – in exactly the same way it has ended badly everywhere else it’s been tried.

The government borrows by issuing bonds, which pay interest. The interest is paid out of tax collected. In the chart below, the green line is actual interest payments. These are relatively low because the federal reserve is pursuing a policy to keep interest rates effectively zero. But notice what happens if interest rates go to 6% – the dark blue line. Interest payments are now as large as defense or Medicare, at about 30 cents of every tax dollar collected. 8% makes interest payments the largest single budget item. The US now owes so much money that returning to a historically typical interest rates will trigger a budget crisis.

This is where the possibility of default become real. Democrats confuse minor reductions in spending, which reduce the possibility of default insignificantly, with real default, which comes from  spending too much.

At least when they can frighten voters.

Interest Payments (dark red) Vs. Receipts (blue) at 8%

Why not just keep rates at zero and borrow forever? The usual reason to raise interest rates is to control inflation (https://mikezintel.wordpress.com/2012/11/29/eggville/), which occurs when the supply of money in the economy grows faster than the real economy grows – making the purchasing value of the dollar fall. While the conditions for massive inflation have been present for years, it’s not occurring – least as measured in the traditional way by the price of a set of goods and wages.

There are 3 dominant forces in the American economy today: Chinese competition holding wages and consumer good prices down, massive debt at the federal and individual levels and massive money printing. Individual debt prevents the usual Keynesian “stimulus” (massive money printing) from working because consumers – wisely – don’t want to take more debt even at low rates. China keeps the money printing from producing classical inflation. The extra money results in waves of massive asset price bubbles in stocks and housing.

The real irony of the Obama presidency is that its monetary policy allows the very rich to borrow for free and to profit from the bubbles, even as the middle class loses jobs and the economy sputters. The system allows the very rich to steal from retired middle class savers and several generations of their children.

In 2008 when Obama took office the federal debt stood at around $10,000,000,000,000 , or about $35,000 per citizen and about $100,000 per taxpayer.

Today the debt is almost  $18,000,000,000,000, $55,000 per citizen, $151,000 per taxpayer.

The job market has not recovered.

Savers are being wiped out.

Our children’s children’s children are being wiped out.

The very rich are getting richer.

Presidents can’t wait for their terms to end so they can join the very rich.

Let’s talk about white privilege, rape culture, the high cost of abortions, animal rights and windmills why don’t we.




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Please Telus if there’s any Hope for us, Telus Mobility

William Michael (Mike) Zintel
Woodinville WA

Wolfville, N.S.


August 21, 2014

Joe Natale, CEO, TELUS Corporation


555 Robson Street, 8th Floor
Vancouver, British Colombia
V6B 3K9

Cc: Someone Who Can Fix Things There
Cc: The Retail Staff in New Minas (thanks for trying)

Re: $73.14

Dear Sir:

I wish I wasn’t writing you now.

Our relationship clearly has to change. I have to leave the country and go back to work, and will not be able to continue to call you 2-3 times per week and then write blog posts hoping to get us back together again. Things don’t seem to be working out for us all that well. But we have a past, and I thought we were solid. Change is hard. At least for me.

I’m sending this as a paper letter, but if it proves in any way helpful, you can forward an online copy as a link:


If you lose that URL, the search phrase Does Telus give a shit?  is returning one of a series of blog posts that now include this letter, at least right now.

Over the last 5 weeks I’ve learned how to function without your wireless internet. But it would be more efficient for me to use the towers that you installed in a low density, reasonably remote area of Nova Scotia, as I have grown accustomed to over the last few years. But we’ve grown apart, it seems. And attractive young WiFi catches my eye more often. Perhaps we’d both be happier apart, as your organization seems hell-bent on ensuring.

I tell myself that I’m writing on behalf of folks who share my frustration, but haven’t time to write. I’m doing it for the people.


The truth is that trying to do business with your organization over the last five weeks has made me stark raving mad. And sometimes a bit angry.

I’m anything but the character one might expect to be writing a screed. I’m not the deadbeat your systems have labeled me. I’m familiar with the complexity of corporate systems, the reality of online fraud and abuse, and I’m aware that my business patterns are a bit of an outlier. I started my career building cellular data switching gear for Mobile Data International (in B.C.). I’ve been in software for 30 years, and for the last 8 I’ve been building and running some of the largest consumer paid and free internet services in the world. I’m usually on the screed reading side of customers I’ve made stark raving mad.


A few years ago, after getting the Deluxe Runaround from one of your (horrible) competitors for short term wireless internet service, your folks at the New Minas Nova Scotia retail store politely put in some time and effort to make this happen for me. For several years I’ve been not only been using your service, but speaking highly of your company and your service.

I want to reinforce that the retail folks consistently put a professional face on Telus and were as helpful as possible. You’ve got good folks there. Indeed all of the employees of Telus I interacted with were professional.

And yet useless. At the same time.

Unless of course I’m just not getting it and you want me so frustrated I just go away forever. In which case it’s working.

The details of the $73.14 affair follow, should you be interested. I know you’re likely busy, so here’s the summary: You didn’t use tell me I owned you $73.14, even though you had multiple good contact methods (and my credit card). You won’t let me pay you now. You won’t give me wireless internet.  You’re conflicted about how punitive you should be with my credit rating.

Personally I don’t care for complainers without constructive suggestions. Here’s a few:

  • Consider a program specifically for short term contracts.
  • Make a query available to billing that captures history across contracts. In my case, my CLV is actually pretty good, and payment history perfect, but billing saw only a single 5 week cancelled contract and assumed a bit too quickly I was a deadbeat. This kind of stuff is pretty easy with big data solutions these days. Put all of your logs and serialized DBs into Hadoop and press on.
  • Use all of the contact information provided when trying to collect payment. The previous two suggestions are, perhaps, OK, but your process on this one is actually incomprehensibly horrible. You sent me email to confirm (what I thought was) my final payment. But you never emailed to inform me that I owned you more. Nor did you call. You did mail a letter to the wrong address, which was returned (apparently).

Then you dropped me into the deadbeat bucket.

This is really the root problem here.

As it turns out, I would have just paid you. Probably by authorizing a charge on the credit card you have on file and used to make what I thought was my last payment.

  • This is perhaps a bit selfish, but maybe you could find my payment, credit my account, and make a note in it that I’m not a deadbeat.

I want to point out that your web site, your systems, the people I talk to all seem customer oriented. There are lots of ways to contact you. Folks seem to try. And yet I am hard pressed to understand what I could have done differently, or how I could have been more motivated to remain a customer. It’s possible that you just don’t want me as a customer and that everything is going according to plan, in which case I apologize for wasting more of your time.



In reverse order:






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Please Telus if this is Normal Telus Mobility

Aug 8, 2014, two weeks from my last conversation with Telus: At this point I’m starting to have trouble remembering what I even wanted in the first place.

A reasonable person would just accept that:

  • Telus told me that I was paid in full.
  • They later changed their mind and decided that I owed then $73.14.
  • After not telling me that I owed them $73.14, they decided to take me to a collection agency. They didn’t do it. Nobody knows why. The company seems divided between those who think they did, and those who think they didn’t. Those who think they did also think I need to fix my credit rating with, well, I don’t understand who – exactly -before I can have any wireless internet.

Oh yeah, that was it – wireless internet.

  • After refusing to accept any form of payment except a wire transfer for $73.14 from someone with bad credit like me, I sent a moneygram to Telus Mobility for $73.14, putting my account number in the comments field, as I was instructed to do.
  • They lost it. Probably.
  • Two weeks ago, they started “an investigation”. Or more accurately, they scheduled a investigation, which hasn’t actually started yet. Apparently they are way behind locating lost payments. I need not worry, they will get to it.

… is just normal.

Perhaps it is normal.


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Please Telus if you Give a Shit Telus Mobility

Does Telus Give a Shit?

Jul 24, 2014: Tried to reactivate in the store; a week had passed since I wired Telus $73.14. The person on the phone, talking to the polite human talking to me, said I’d have to call Equi-somebody to get my credit straightened around. They refused to talk directly to me and referred me to customer service. I called and was told they hadn’t received payment but would start an investigation. I should call back in a week.

At this point the questions are no longer “am I paid up?” or “will I get wireless internet?” The hope of having a stable, sane and mature relationship with Telus is becoming a distant dream. We’re locked into a co-dependent abusive spouse nightmare pattern now. Indeed I should get out – but as I jump from hurdle to hurdle, always thinking that my wireless internet is just one trip to town and maybe a half dozen phone calls away – I encounter people who tell me their stories aabout busive relationships with Telus. And I begin to wonder: “Does Telus give a shit?”

This isn’t easy to answer. The people in retail stores clearly give a shit. And the people on the phone are polite. Almost too polite. The politeness confuses me – maybe they give a shit. But clearly no company that gives a shit would put me thought this. And what about they guy who wouldn’t speak directly to me. Does he give a shit?

I understand why I might think Telus doesn’t give a shit when perhaps they do. Their collections dept has to deal with a stack of deadbeats and cheats. Each case takes time and has some probability of success. Folks who need jobs are measured on this. They are not measured on new sign-ups or customer satisfaction.

From their POV, I pay for 2 months of service / year, cancelled without paying in full, and live in America. I’m not even worth taking to a collection agency, let alone giving wireless internet.

Yet somehow I am left with the feeling that they just don’t give a shit.

The sad irony here is that this is Canada, where the nanny state prides itself on protecting the little guy from himself and from the big guys. Here a two person roofing crew is subjected to a silly level of harassment while a spectrum license shields you from the kind of competition that might make you give a shit.


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Please Telus How to Buy Internet from You

Aug 19, 2013: After (another wonderful) summer in Nova Scotia, I cancelled my Telus Mobility month by month wireless internet contract. Paid off the bill – in full per what I was told – via the credit card Telus had on the account. Received email from Telus confirming payment and cancellation.

A year goes by: No phone calls, mail or email from Telus.

Not one.

Jul 16, 2014: Tried to reactivate service in the store. Was told (politely) that my previous bill was unpaid and I had been taken to a collection agency. I would have to pay up before I could have any internet.

Jul 16, 2014: Called Telus. The unpaid bill is for “Aug”. Contrary to what they told me last year at cancelation-time, I had only paid for Jul.

Jul 17, 2014: Called the collection agency. They’ve never heard of me.

Jul 17, 2014: Called Telus. Apparently, they meant to take me to a collection agency, but didn’t. They don’t know why. Tried to pay up with the same credit card they had charged at cancel last year. Can’t do it – US credit cards need to be “registered in the system”, which I was no longer now that my account was in written off state.

Telus suggested I wire them the money. More than “suggested”,  they helpfully pointed out that they could take me to a collection agency at any time.

Jul 18, 2014: Wired Telus $73.14.

Jul 19, 2014: Tried to reactivate in the store. Was told (politely)  that sometimes it takes months for a bad actor like myself to be allowed to do business again with the Telus.

Jul 21, 2014: Called Telus. They hadn’t received the payment. I asked if this was normal given that wired money should be fast. I was told that in the case of someone taken to collection, this could take 10 days. After I explained that the payment was to Telus directly,  I learned that they may have the payment, but it can take upward to 5 business days to credit it to my account. After Thur of this week, we would – collectively – know if the payment was received or lost.

To be continued …



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Terrorist Anarchist Hostage Taker Teabaggers Defeated – Adults in Charge Again (was: Loose Money and a House of Cards)

Washington is finally working together, to keep the country moving.

Obama has reduced the deficit.

We can borrow more money. A lot more money.

Borrow from who?

The mechanism of federal government borrowing is to sell treasury bills. The buyer of a bill loans the government their money, for a period of time, and gets their principal and interest back in the future. The value to purchaser is that the US government is the most secure investment in the world, as judged by historical economic and political stability, growth and aggregate wealth of the country.

Except it hasn’t been working like that for a while now.

Every month, the Unites States of America issues treasury bills that nobody wants to buy (at the offered interest). So the Unites States of America buys them, using money that it creates from thin air.

This interesting innovation in monetary policy allows the government to avoid doing what used to be considered normal, to offer treasury bills at an interest rate people want to buy them at. The economic principal is that market bond rates reflect real risk, and place a backstop on excessive borrowing.

Interest rates, for banks and government are effectively zero. Like they have been in zero growth Japan for the last 20 years.

Why do they do this?

Because we now owe so much money that if when interest rates rise, the interest payments will balloon to a significant amount of the tax collected, requiring cuts in spending or massive tax increases.

This graph shows the difference between what the federal government collects in taxes, and what it pays out, adjusted for a hypothetical 2%, 4% and 6% increase in treasury bill interest rates, starting in 2006:


This graph shows the same effect on the total federal debt:


Debt is only “free” if rates stay at zero.

No big deal. We’re America and we can just keep doing whatever these geniuses are doing because we’re America and the geniuses are doing it again.

Normally loose money like this is inflationary: it causes wages and prices to rise (with no increase in the underlying value of labor or goods),  and the value of the dollar to fall relative to other currencies. The latter is certainly happening, and is reflected in the price of gas.

But traditional inflation is not happening. What is happening is all this “extra” money is chasing one asset bubble after another. Tech, housing, gold, now stocks. Each new bubble creates new winners and losers in what has effectively become a rigged casino. The house (banks) take a vig and always win. The super rich and the insiders clean out the middle class and the poor get poorer.

Hope and change.

Ironic, eh?

This doesn’t end well.


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Eugene Robinson’s First Draft


While Republicans were throwing their silly tantrum, Obamacare became a fact. There is no turning back.

Progressives know that there is no better way to expand the reach and control of a peaceful government than to make people dependent on it for their very life, and to destroy alternatives. And the point of Obamacare, to be sure, is exactly that.

The legislative and bureaucratic excesses needed to pass and ram this thing down the throats of the country will certainly result in a GOP supermajority in the future. But no matter, because other countries have demonstrated that a dependent country cannot unwind the dependency, and future governments will fight over who can best manage a sprawling, failing system.

Fuck you, suckas.

Many people oppose Obamacare now, but soon the country will be dominated with low skill, low wage unemployable people wanting someone else to pay for their healthcare.

Fuck you, suckas.

One of the brilliant deceptions of Obamacare, that we used to ram this thing down your throats is that we can sell it as a private system, unlike the hated by knuckle-dragging, gun-clinging, bible thumping Midwesterners who fear the Canadian and British “government” systems.

Of course, the system we have created is unstable. As it collapses, we will replace it with single payer.

Then we can really start to control costs by rationing care.

Fuck you, suckas.


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