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Cake day: June 13th, 2023

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  • Well, their interpretation is at odds with reality, and they should reconcile that. Regardless of what they told or what they believed, they paid into a system where they were forced to subsidize current recipients, while the system itself could be revoked at any point, leaving them high and dry, and not running into 14th Amendment issues or anything like that. See Flemming v. Nestor, 1960 - quoting Wiki:

    Flemming v. Nestor, 363 U.S. 603 (1960), was a United States Supreme Court case in which the Court upheld the constitutionality of Section 1104 of the 1935 Social Security Act. In this Section, Congress reserved to itself the power to amend and revise the schedule of benefits. The Court rejected that Social Security is a system of ‘accrued property rights’ and held that those who pay into the system have no contractual right to receive what they have paid into it.[1]

    Note that I’m not saying anything “should” be one way or another, besides that people should be fully aware how the current system works in law.


  • Social Security’s “trust fund” is an empty pit of debt obligations. Benefits to current recipients are paid with incoming payroll taxes. Any difference is made up with additional taxes or monetary inflation, by way of Treasury bonds. They “reinvest it in the economy” if there’s ever a surplus, e.g., through military contractors. It finances the national debt.

    Putting aside the quirks of that setup, the basic function is that the taxes you pay in now are not an investment in your own future, you’re basically just paying for the retirement of older people now. The expectation is that someone down the road will then pay taxes to finance your retirement. Hence, how SS was able to start paying benefits almost immediately (3 years) after payroll taxes started being collected.


  • What is your prediction for what will become of it, though. GDP growth stops and people start bursting into flames? You know we’ve actually observed this before, right?

    Now, if you do mean “capitalism” not in the plain definition of “an economy based around private ownership”, but the more specific version where control of capital is highly centralized - there’s some truth to the idea that economic decline can cause people to start looking to reform that system. True of any system, really, because people generally don’t want to see their quality of life decrease. But that’s very different than an economic system “requiring” it to function.








  • Right, so up until the point the USDA PLC programs get exhausted (afaict ~$25B/yr), they compensate for the difference between the price floor (not sure if we’re above or below that now) and market price. But that’s a subsidy to the farmers, not an effect on the market price - the expense comes to taxpayers. And sometimes, they scoop up surplus through CCC, then remarket it elsewhere, an indirect/artificial market mechanism, which can include exports.




  • It depends on the market. If producing less food with the same resources costs more, prices will rise–especially on large commercial farms, which dominate the U.S. agricultural sector.

    The part you quoted from what I said was in reference to an agricultural buyer being lost. There are other reasons to anticipate the costs of inputs increasing, but I’m going through analyzing factor by factor (descending analysis) and all of a sudden we’re jumping back up to the top to talk about something else.

    Re: grocery chains (not USAID) and futures contracts - not sure how this ties in either, we’re talking about USAID, which AFAIK does procurement through a bidding process for direct purchases, not via futures.


  • I’m not sure what your main point is here. I was responding to you grouping together a labor shortage and a demand shock as - from what it sounded like - a reason to expect high prices. But demand shocks lower prices on the consumer side of food production, as opposed to raising them, because the food at that point exists, and whoever has it needs to sell it, more desperately than they were before.


  • True, well, I mean, take the effects I described and apply them to the respective agricultural sectors. We will very likely see price increases in fresh produce and some price decrease in corn, soy, wheat, dairy, etc. (I say “some” because the actual global demand for food hasn’t decreased, rather, the purchasing power has been decreased because some subsidization has been lost due to USAID absence).