Commentary From the Mile High City

"Star of the conservative blogosphere" Denver Post

"The Rocky Mountain Alliance offers the best of what the blogosphere has to offer." -David Harsanyi, Denver Post
Joshua Sharf

 notify list
to receive email when this site is updated, enter your email address:
 recent posts
24 (2 entries)
Anglosphere (1 entries)
Biking (1 entries)
Blogging (35 entries)
Business (173 entries)
CFA (3 entries)
China (5 entries)
Climate Change (3 entries)
Colorado (20 entries)
Denver (12 entries)
Design (4 entries)
Economics (39 entries)
Education (6 entries)
Electoral College (1 entries)
Environmentalism (3 entries)
Europe (0 entries)
Flying (2 entries)
Foreign Affairs (1 entries)
General (89 entries)
Gun Control (2 entries)
Health Care (7 entries)
Higher Ed (7 entries)
History (8 entries)
Home Improvement (1 entries)
Illegal Immigration (35 entries)
Internet (4 entries)
Israel (57 entries)
Jewish (49 entries)
Judicial Nominations (12 entries)
Katrina (0 entries)
Literature (1 entries)
Media (37 entries)
Music (3 entries)
Photoblogging (32 entries)
Politics (152 entries)
Porkbusters (5 entries)
Radio (16 entries)
Religion (1 entries)
Reviews (8 entries)
Robed Masters (4 entries)
Science (1 entries)
Sports (9 entries)
Taxes (2 entries)
Transportation (6 entries)
Unions (1 entries)
War on Terror (180 entries)
my other blogs
Three-Letter Monte

Rocky Mtn. Alliance
Best Destiny
Daily Blogster
Geezerville USA
Mount Virtus
Night Twister
Rocky Mountain Right
Slapstick Politics
The New Conservative
Thinking Right
View from a Height

other blogs
One Big Swede
American Thinker
Meryl Yourish
NRO Corner
Little Green Footballs
No Left Turns
A Constrained Vision

business blogs
Accidental Verbosity
Assymetrical Information
Carnival of the Capitalists
Cold Springs Shops
Commodity Trader
Coyote Blog
Different River
Everyone's Illusion
Fast Company Blog
Financial Rounds
Freakonomics Blog
Management Craft
Trader Mike
Carnival of the Capitalists Submission

business data
Inst. Supply Mgmt.
St. Louis Fed Economic Data
Nat'l Bureau of Economic Research
Economic Calendar
Stock Charts

colorado blogs
Pirate Ballerina
Pagan Capitalist
Boker Tov, Boulder
Colorado Pols
Jeff Sherman

<-?Colorado BlogRing#->

sites, not blogs
Thinking Rock Press
 help israel
Israel Travel Ministry
Friends of the IDF
Volunteers for Israel
Magen David Adom
 1939 World's Fair
1939: The Lost World of the Fair
The New York World's Fair: 1939-1940
The Last Great Fair by Jeffrey Hart
Iconography of Hope (U.Va.)
Images From the '39 Fair
Tour the 1939 New York Fair
Powered by
Movable Type 3.2

« The Team That Couldn't Count Straight | Main | The Axe Falls »

Borrowing for Consumption

While reading the section on foreign trade in the Economics study session, I came across this unfortunate paragraph:

In 2005, we borrowed almost $800 billion from abroad. In that year, private investment in buildings, plant, and equipment was $2270 billion and government investment in defense equipment and social projects was $430 billion. All this investment added to the nation's capital, and much of it increased productivity. Government also spends on education and health care services, which increased human capital. Our international borrowing is financing private and public investment, not consumption.

This is as untrue as it is is comforting.

Let's grant for the moment that everything they list here can be classified as investment. There's still roughly $10 trillion of other spending that took place that year, much of which was consumption. One can't simply assume that the $800 billion was borrowed solely to finance these projects.

But of course, even these projects aren't all investment. Social projects may or may not simply be money down a hole. Education? To a point, but it's hard to see how another couple of hundred thousand sociology majors are going to materially contribute to the well-being of the country. Health care services? Certainly, except that the overwhelming majority of health care spending takes place in the last year of life. This isn't to say that those lives have no moral value - of course they do - only that their economic value is diminished. (Watch this, by the way, when the Democrats start arguing this summer that we can't afford health care for the old and sick, but count all health care spending as, "investment.")

No, in addition to buying things we no longer make ourselves, a lot of the spending cited above really is just consumption. It's a shame that an organization devoted to clear anbalytics can't get that right.


If you want people to believe something, repeat it, repeat it again, and repeat it again and again over several years...continue to repeat it and over time, they will believe it. Before 1994, it was common to hear the claim of "it's an investment" in news bites about everything, for about 12 years it had to take a break, and now it's back again in full-force. Just listen to all the recent speeches. Everything’s an investment and because it's an investment you are benefiting and therefore it's necessary and proper. If it was consumption, then it wouldn’t be necessary and proper; therefore, we must call it an investment and make sure all others understand it's an investment. To does this, every time we speak of it (fill in whatever you like here for “it”), we must point out it is an investment.

I’m sure that there are people out there who believe that the health care you speak of in the article is an investment not because they know but because they have been told so many times that it is.

Keep writing and taking photos. I have been a silent fan for awhile. I enjoy your honest, straight forward content and miss it when you do not post new content.

Best regards

Post a comment

(If you haven't left a comment here before, you may need to be approved by the site owner before your comment will appear. Until then, it won't appear on the entry. Thanks for waiting.)


Power, Faith, and Fantasy

Six Days of War

An Army of Davids

Learning to Read Midrash

Size Matters

Deals From Hell

A War Like No Other


A Civil War

Supreme Command

The (Mis)Behavior of Markets

The Wisdom of Crowds

Inventing Money

When Genius Failed

Blink: The Power of Thinking Without Thinking

Back in Action : An American Soldier's Story of Courage, Faith and Fortitude

How Would You Move Mt. Fuji?

Good to Great

Built to Last

Financial Fine Print

The Day the Universe Changed


The Multiple Identities of the Middle-East

The Case for Democracy

A Better War: The Unexamined Victories and Final Tragedy of America's Last Years in Vietnam

The Italians

Zakhor: Jewish History and Jewish Memory

Beyond the Verse: Talmudic Readings and Lectures

Reading Levinas/Reading Talmud