Thursday, July 9, 2009

Let's apply this thinking to real life.

Just wondering how it would turn out. (I'm still working on thus analogy, so give me a break for the obvious holes.)

There's a man, let's call him Simon. Simon is a partner in a company that makes metal die-cast model cars, is known to be a spendthrift, but usually stays within his means. Simon soon becomes and avid collector of those model cars, and urged by the president of the company, he soon begins to spend more than he makes in order to collect them. In order to deal with his debt, takes out loans that he can't pay. Debt upon debt keeps piling on him, while at the same time, the value of his die-cast cars is dropping.
The value is dropping because due to protests made by concerned mothers, the cars are made out of cheaper materials that contain lead rather than the more expensive materials formerly used. Simon and other collectors threaten the company with lawsuits, boycotts, and reporting them to the government for using toxic materials. They go back to the former materials. Simon is not satisfied, however, and fights his way to the presidency of the company. Simon buys more and more cars, and his debt rises. he cuts paychecks to pay for his debt, and loses, workers. Production slows, the cars become more expensive to produce, and sell less.
Finally, Simon forces his two sons to mortgage their homes and dips into his daughter's college fund for a last minute shot of new cash into the company, which he plans to spend quickly on company-related pet-projects. After six months of no upturn, he plans to coerce his youngest nephew into mortgaging his home so that he can continue the same cycle he's been in for years: Spend more than he has, make debt, borrow money to pay debt, make more debt, threaten to put others into debt, take their money and spend it, causing more debt, followed by more borrowing, debt, borrow, debt, borrow, debt, etc, ad infinitum.
This seems to be Obamanomics.

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