The stuff revolutions are made of II

Two comments from Mike Shedlock who, as always, is on the ball.  The first just shows the contraction underway in the general economy. The second is one of the results of economic contraction. Essentially, the problem is not only the contraction in itself; the problem is that as that happens and jobs are lost and salaries are cut, the larger problem for government is the loss of tax revenue. As I explained in The Stuff Revolutions Are Made Of, as state revenues shrink, government will divert resources from public services to maintain those services the lack of which would more readily show a problem; i.e. all those disbursements that are perceived directly by the public like pensions (such as they are) or disability payments.

Anyway, the result is that services to the public will be curtailed. Things like mail delivery, driver license renewal or, in this case, court services. But considering the extent and depth of economic devastation we have suffered in the past 8 months, our respective governments are still in the phase of “re-arranging deck chairs on the Titanic”.

http://globaleconomicanalysis.blogspot.com/2009/03/ism-manufacturing-sector-contracts-13th.html

http://globaleconomicanalysis.blogspot.com/2009/03/time-to-rollback-government-salaries.html

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One Response to “The stuff revolutions are made of II”

  1. Tic, toc, tic, toc… « Guido’s temple of the absurd Says:

    […] Tic, toc, tic, toc… By guidoamm Take a pick from previous essays here, here or here. […]

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