As another Lame Cherry exclusive in matter anti matter.
Economics in America is not about earning money, but instead about how the feudal few can legally steal money from the public Treasury.
- Lame Cherry
As I type this, it is the first part of this month and the North Dakota is moving through the same cycle that the American regime in DC is moving through in not economic management, but the Crack Whore Economy. I am going to use North Dakota as an example as it is the American example, as much as the Russian example of how to spend money like a crack whore.
North Dakota had the legendary oil boom cycle, which saw their revenues jump 40% in the positive intake of taxes. One must understand though North Dakota's precarious position as it is Russia as much as America.
North Dakota operates under three revenue generating taxes.
1. The farm ranch economy
2. The oil economy
3. The construction economy
For those who understand economic conditions, there is not any manufacturing, nor financial generation, nor "technology" as in the creation of new products which sucks money from the outside world to North Dakota. Instead North Dakota has a non value added production in oil, grain, meat which other states process for increased profit, and construction which is in-state.
The state now has the cyclical problem of boom and bust, in the farm economy is in depression, the oil economy is in depression, and when those two economies are in depression, there is not construction, so that economy is in depression.
How North Dakota gains tax revenue from the above are royalties in oil which is not an acceptable share, income taxes and sales taxes.
What North Dakota has been faced with since the disaster of Governor Byron Dalrymple who now resides in sunny Florida with the crack whore spending of Republicans in Congress, is budgets which are bloated and a constant removing funds from rainy day accounts to make up shortfalls.
This group kept lying to itself that oil would rise again, but the fact is they now understand that oil will not rise and they are stuck with no money coming in to pay for their huge infrastructure and 150,000 more people to deal with.
It was stunning to listen to these pie in the sky leaders there just light up when they thought oil was going to bring back the boom, because if one observes simple economics this is the reality:
Oil goes up 10 dollars to 60 dollars a barrel. Gas in turn goes up 50 cents per gallon for this 10 dollars, of which North Dakota in royalties received only pennies. In the end, North Dakotans were getting a penny back for every gallon of gas which was flowing out of state at 10 dollars more per fill up.
A penny gained by the state and 10 dollars lost from 500,000 people is 5 million dollars per week pouring out of the state. That is not economic sense.
North Dakota was a place I simply wanted to reach out and manage, because in the middle of nowhere Warren Buffett had his rail monopoly, for oil transport, which went to war with the oil pipeline groups, and in the meantime, North Dakota was spending billions in 8 lane highways for trucks to haul oil to rail points, and wasting money on community centers, new hospitals and new schools, which now without oil revenue are sitting there still needing to be heated and cooled, maintained and sucking money out of an economy which is depressed.
The current Governor is a businessman like Donald Trump and is speaking about 20% agency spending cuts. Those cuts should have taken place five years ago, but Republicans like Democrats could not spend money fast enough like crack whores in not preparing for the future. So the situation is, the oil has peaked. The farm economy is not going to rise until another Soros speculation, and construction projects are finished, and yet North Dakotans have their high priced real estate of cactus plains sucking their money from their hard work.
In that North Dakota is a regressive state on taxes, as is Minnesota, as is Missouri and almost all other states rapining Americans. They have both sales and income taxes which penalize production and selling, which is what one needs to engage in to make an economy grow.
It is interesting to drive through Missouri and see very low gas prices, because Missouri did not raise gas tax prices as Minnesota and North Dakota did. So Kansas gas is always higher as they have gas sales tax spikes to generate tax revenue. This is not the case in North Dakota though for the national average, so there is this massive draining on the North Dakota economy as it feeds the infrastructure which has nothing on it now to pay for it, and the jobs are at the stagnant rate, as 150,000 more people in cactus prairie can not generate wealth in producing anything beyond local cupcakes. So it is oil and farm commodities, and their services, and those services are more technology and robotic, so one does not need a threshing crew to harvest wheat where a 350,000 dollar John Deere combine performs all the work and John Deere in Illinois reaps the profits as there are no hayseeds in North Dakota anymore buying beer and brats.
What North Dakota should have done was to insist that any corporation moving into the state for oil, appear with one technology plant. Buffett should have been made to build a plastics facility in North Dakota and not India, but none of that farsighted genius was available in North Dakota as the leaders there never gleaned anything from the bust in the 1980's.
Each of your states or provinces reading this, and nations from Canada, to France, to Slovakia, to Russia understand the above, although most of you have been spared by boom cycles, because your regimes are so socialist communist that the oligarchs have all the money while you are like the people of North Dakota now working for wages twice as hard, and losing ground because the bankers and real estate crooks have driven up housing prices to bleed you dry.
North Dakota was a place one decade ago that 50,000 dollars would have purchased a very nice home. Now that same house is 250,000 dollars and it was from the quick money of the oil and wheat boom, but those prices all dropped, but the costs of living have not.
It is the problem of North Dakota in the current leadership is cutting spending, but too late. Into this, they are not dealing with the massive problem of how to get tax revenue back up, because in 5 years all of those roads and buildings are going to require expensive resurfacing and roofs. Therein lies the problem in if North Dakota does not cut income taxes and sales taxes, they will continue to hinder any semblance of growth, but North Dakota is not going to cut high sales, income or property taxes, and this is their doom, because without cutting taxes and spending, there will not be any economic activity to generate the taxes to pay for all their crack whore lifestyles.
They are a street whore who found 50,000 dollars, purchased a Mercedes, and now do not have the money for bread, gas or a roof over their heads, so the car sits there and rusts out until it is confiscated.
North Dakota will continue to languish and bleed itself dry as it is bled dry by Wall Street of its resources taken by others and value added to them, and sold back to North Dakotans.
This type of mismanagement is something to be castigated as North Dakota should have tens of billions of dollars on deposit, and as creditor made solid loans to other states in order to preserve the wholesome life there in a clean industry, with other manufacturing industries based on oil and agriculture reinvesting those profits inside the state for financial overturn and expansion. Instead, I found this amusing reality of North Dakota.
When Soros drove up wheat prices, North Dakota had a state operated mill, which raised prices along with the national chains. There is a Gold Medal in Minnesota though which dropped its prices fifty cents for 5 pounds of flour, undercutting North Dakota. It took the state of North Dakota another year to cut their price by 50 cents a bag to undercut a Minnesota based industry. The crime in this is wheat prices plunged 5 years ago, so North Dakota was screwing everyone over for five years in charging higher prices.
Think of it if North Dakota had gone out and halved prices on its state flour, and expanded into Walmart and other retail outlets, instead of gouging people?
In this North Dakota would have been importing grain from the region, making value added profits and probably would have had a multi billion dollar grain mill, as the Minnesota mills are, but there was absolutely no foresight nor purpose in a crack whore seeing money and only how to shove it down her knickers and spend it on dope.
Until North Dakota cuts a new deal, and makes the oil companies invest in manufacturing for that oil, and for other agricultural industry to invest in North Dakota to do business there or it will all be Belarus from Russia having a monopoly. Cutting spending is not accomplishing anything but prolonging the death, as North Dakota is not cutting the taxes and the first thing that state should cut in taxes is ridding itself of personal income tax and luring all those industries out of Minnesota with a 10 year income tax freeze providing those businesses either double the jobs in their plants every five years or bring in another clean economic business.
Nuff Said
agtG
