Mark & Mark!
August 20, 2011
(Via Steyn Online, whence the title of this entry.)
Mark Steyn had a great line in an interview with Mark Levin about Steyn’s new book:
What I think is the difference when you talk about the divide in America is I think most conservatives exist in a kind of oppositional world. They know every time they go and see a Hollywood movie, every time they switch on a sitcom and hear a certain kind of cheap joke, every time they happen to be stuck at the airport and they’re watching some drone on CNN—they understand the other guy’s point of view, they’re exposed to it relentlessly.
(As I’ve put it before, “It’s difficult to be a conservative without thinking about it. . . . television, movies, and other popular culture, those media will be a source of overwhelmingly liberal social pressure.”)
Great interview—listen to the whole thing if you have twenty minutes.
Speaking of great lines, here’s another from Steyn on one from Perry (who did I mention is a great federalist?):
Rick Perry, governor of Texas, has only been in the presidential race for 20 minutes but he’s already delivered one of the best lines in the campaign:
“I’ll work every day to try to make Washington, D.C., as inconsequential in your life as I can.”
The whole column (which of course I recommend) is freely available (if surrounded with ads) at The Orange County Register.
Enjoyment and Contemplation 
August 20, 2011 at 11:56 PM
I listened to the interview, and found it a fascinating mix of good and bad arguments. One thing I found particularly interesting: around 15:40, Steyn attempts to illustrate the absurdity of thinking that the world, in 2020, will “be willing to sink 20% of its GDP into U.S. Treasury debt.” Steyn commits a semi-fallacy here: measuring a stock (Treasury debt) in terms of a flow (GDP). That’s a rhetorical trick liberals pull all the time.
Still, it got me thinking, and I looked up a few statistics. Credit Suisse estimates that total global wealth amounts to roughly $200 trillion (see http://www.economist.com/node/17929057). The total U.S. national debt is, as of tonight, $14 trillion. Therefore (unless I’m missing something), according to these figures, roughly 7% of all the wealth in the world is held in the form of U.S. Treasurys.
Holy perspective, Batman!
Steyn may not have chosen the best metrics to make his point, but I’m pretty sure that we can’t realistically expect this figure to rise much higher. Either growth in the total global stock of wealth will have to keep pace with U.S. debt growth (while the U.S. retains its creditworthiness!), or I suspect we’ll soon see saturation.
August 22, 2011 at 9:45 AM
So, that’s scary, right?
August 22, 2011 at 11:55 AM
Not as scary as Stein tried to make it sound.
August 22, 2011 at 1:03 PM
You don’t think it’s especially scary that 7% of all the wealth in the world is held in the form of U.S. Treasurys? Even though the White House’s own optimistic projections anticipate a 70% increase in the national debt over the next 10 years? (http://www.whitehouse.gov/sites/default/files/omb/budget/fy2012/assets/tables.pdf)
Sure, Steyn gets downright apocalyptic. Such talk is unfashionable, but when I see the kinds of unrealistic assumptions our leaders our making with regard to matters of enormous consequence, I have a hard time saying he’s demonstrably wrong.
August 22, 2011 at 1:38 PM
No. Why would I be scared of having too much debt? Even the thought of the economy collapsing into a great depression and me losing my job and all my money does not inspire fear in me.
August 22, 2011 at 1:59 PM
Ah, maybe I needed to phrase my question better. By “don’t you think it’s especially scary…” I didn’t mean to refer to the emotions that these statistics evoke in you. (In fact, I often entertain fantasies about survival in a post-economic-collapse society, so I guess the prospect isn’t really “scary” to me either. I just hope there are no zombies.) I was probing for a rational argument about why the statistics I cited are no cause for concern.
So, 7% of all the wealth in the world is held in the form of U.S. Treasurys, and under extremely optimistic projections we’ll be increasing the national debt by “only” 70% over the next decade. I’m not going to do the sensitivity analysis right now, but do you think the global economy will be eager to hold an ever-larger percentage of total wealth in the form of Treasurys? Or will we reach a saturation point?
August 22, 2011 at 2:33 PM
Eventually it will reach a saturation point, but I think that for a long time there will continue to be great demand for US Treasuries, because it is seen as such a safe investment.
August 23, 2011 at 11:09 AM
BTW, the correct plural of “Treasury” in this context is “Treasurys.”
August 23, 2011 at 11:22 AM
That’s so weird. I remember always thinking about people’s names, too—if there are two people named Ricky, for example, shouldn’t they be known plurally as Rickies? or if a family is named Ashbury, shouldn’t they be the Ashburies? But I guess they’re not.
As to the substantive content of this discussion, I give up on getting Snoodickle to “wake up”, in the parlance of our times. At a time when enough of the liberal media have pulled their heads far enough out of the sand that “egotistic” can try to make it sound as if they had been up on the looming crisis all along, Snoodickle looks straight at the unsustainable numbers and is still confident that we have nothing to fear “for a long time”.
August 23, 2011 at 11:44 AM
That’s right, a long time. We can sustain for at least 15 or 20 years, probably more, which I consider a long time. Indeed, the statistics tell us that at least one of the four readers on this blog will be dead within the next 20 years. Assuming that person will be me, and seeing as how we will be able to sustain for the remainder of my duration on this planet, I am confident in calling this a long time.
August 23, 2011 at 11:48 AM
P.S. If I may refer back to our discussion about American v. British style grammar, when you use quotation marks to emphasize a phrase such as “wake up,” but are not actually quoting anything, you still use the British style. Again, I find this curious.
August 23, 2011 at 2:07 PM
“I think that for a long time there will continue to be great demand for US Treasuries, because it is seen as such a safe investment.”
This argument, if assumed to be correct, supports the conclusion that our *current* debt level is sustainable. However, to support the assertion that we can continue to increase the national debt by double-digit percentages each year, you have to make the case for continually *increasing* demand for U.S. Treasurys. You have to say, not just that U.S. Treasurys are an attractive investment, but that they will be more and more so as we rack up debt over the next several years.
August 23, 2011 at 3:48 PM
As I said, eventually it will reach a saturation point.
August 23, 2011 at 4:10 PM
BTW:
http://investmentwriting.blogspot.com/2010/04/treasurys-vs-treasuries-which-is-right.html
August 22, 2011 at 11:56 AM
*Steyn
August 23, 2011 at 5:33 PM
“As I said, eventually it will reach a saturation point.”
But why are you so confident that the saturation point is 15-20 years off? We’re on track to double the national debt long before then.
August 24, 2011 at 8:21 AM
For two reasons (1) major deficit reduction is on the horizon. President Obama already indicated his willingness to reduce the deficit by over 4 trillion dollars. Chillingworth will read Mark Steyn and scream and cry how President Obama never presented the American public a highlighted and bullet-pointed plan, but the fact remains that President Obama did propose 4 trillion in reductions to Speaker Boehner (which Boehner rejected). However, I think that major deficit reduction is imminent.
(2) The United States economy is perfectly capably of functioning even when our national debt far exceeds our GDP, and creditors know this. At the end of World War II, our national debt was 130% of our GDP. And this was right before our economy starting booming! Japan’s national debt is 173% of its GDP, and creditors still lend to them. It’s going to be a long time before creditors stop buying our Treasurys(ies), at least 15 to 20 years, probably more.
August 24, 2011 at 12:13 PM
My argument wasn’t so much about debt/gdp ratios or the government’s long-term creditworthiness (although I maintain that these are causes for concern), or about the economy’s ability to function despite high debt. I’m saying that we can’t expect demand for U.S. Treasurys to grow as fast as the projected quantity supplied.
For an analogy, if the Ford Motor Company suddenly decides to double production, they’d better have a really good marketing campaign up their sleeves, because they can’t expect consumers to suddenly start buying Fords just because more of them are being made. Absent a phenomenonally successful marketing campaign, the only way Ford could unload that many new vehicles would be to sell them at a huge loss–probably enough of a loss to put the company under.
You’ll have to excuse me if I’m skeptical about the prospect of a huge deficit reduction plan that will actually work. As you mentioned, Boehner rejected the President’s proposal, and I think we can expect to see continued deadlock, posturing, and intransigence for the forseeable future. We’re not heading toward a new era of fiscal responsibility, we remain a society in which Democrats cling to the fantasy that we can get our fiscal house in order by raising taxes on “the rich” while Republicans cling to the fantasy that we can do it without new revenues.
August 24, 2011 at 4:01 PM
http://www.nytimes.com/2011/08/25/us/politics/25fiscal.html?hp
It looks as if the national debt is not going to grow as fast as we originally predicted.
August 24, 2011 at 11:06 PM
That forecast assumes that the Bush tax cuts will all be allowed to expire. If you think that will happen, I’ve got a bridge to sell you. With regard to all but the top bracket, the vast majority of Congressional Democrats and Republicans are committed to the status quo.
August 25, 2011 at 9:37 AM
If politicians are serious about deficit reduction, then the Bush tax cuts should be allowed to expire.
August 25, 2011 at 9:52 AM
“If.”
August 24, 2011 at 1:11 PM
I agree that thinking taxes alone will solve the problem is a fantasy. Chillingworth, do you agree that solving the problem with no new taxes is also a fantasy?
August 27, 2011 at 1:46 PM
[…] I know that not everyone reading this is the biggest fan of the Republican Party, and I agree that it’s far from perfect, but don’t you agree that there’s some appeal to a candidate who wants to make Washington, D. C., as inconsequential in your life as possible? […]