From: gary@ke4zv.uucp (Gary Coffman)
Newsgroups: sci.space,sci.astro,talk.politics.space,alt.politics.bush,alt.politics.clinton
Subject: Re: Clinton and Space Funding
Date: 29 Sep 92 13:13:31 GMT
Reply-To: gary@ke4zv.UUCP (Gary Coffman)
Followup-To: talk.politics.space
Organization: Gannett Technologies Group

In article <j8#pmzm.tomk@netcom.com> tomk@netcom.com (Thomas H. Kunich) writes:
>In article <1992Sep27.151838.467@ke4zv.uucp> gary@ke4zv.UUCP (Gary Coffman) writes:
>>
>>Voodoo economics Nick. Most US military R&D is spent in the private
>>sector paying private companies acting as private contractors to
>>the military.
>
>Might I suggest a short course in economics? Consider any money spent
>on military hardware to be dumped down the drain. Or perhaps you think
>that the present recession is caused by companies refusing to use all 
>of that 'good' military expertise to capture the world's market?

Nonsense. If you import military tech and don't need the weapons, 
then you've poured your nation's money down the sewer. But if you 
manufacture domestically, as we do, then the money stays in the 
domestic economy building a technical infrastructure and expertise, 
and spurring growth in the civilian economy as the dollars go through 
their multiplier. Military and aerospace dollars have a particularly
high multiplier, 7x, because the jobs pay well and allow the workers
more discresionary income that can be spent in the civilian economy.
Direct public assistance funds have a much smaller multiplier, around
2x, because the recipients don't have large discressionary funds for
major capital purchases, they mostly pay rent and buy food. The same 
applied to Apollo or other space programs. No money went into space, 
it stayed right here in the pockets of the Americans who designed and 
built the hardware and the pockets of the people from which they bought 
consumer goods. The only problem occurs when you spend money you don't 
have year after year. That places a mortgage on the future that ultimately
comes due.

Military spending has produced an enviable technical expertise, but it
has not produced expertise in cost effective *management* in a competitive
environment. Sheltered by government contracts, most aerospace firms have
grown soft and lazy about managing and marketing their products to any
customer beyond a government. Managers are adept at manipulating *political*
customers, not cash customers. This is the real secret of Japanese success,
they've mastered the *consumer* market. Their technical expertise is not
better than ours, in fact much of what they sell us is based on US patents.
But their marketing and production skills are honed much finer than those
of our military industrial complex.

The present recession has the same cause the world over. People, 
businesses, and governments overextended themselves and ran up 
massive debt loads, mortgaging their futures. Particularly when 
the speculative bubble in real estate burst, private debt had 
inadequate collateral and borrowing was sharply curtailed. This 
effectively reduces the money supply since leveraged debt is extra 
money in the economy. Economic growth has declined as people concentrate 
on paying down their accumulated debt, further decreasing the available 
money supply. This has a spiral effect as less purchases are made,
fewer products need be produced and fewer workers employed. As debt 
comes under control, confidence builds, products are purchased reducing 
inventories, and production ramps back up hiring new workers, and we 
re-enter the upward spriral of growth again. In classical economic 
textbooks it's called the *business cycle* and has been around as long 
as capitalism. The government tampers with it at it's peril.

Government has been involved in a massive wealth transfer scam, pulling
wealth from the private sector to the public sector where it's unavailable
for capital formation. This enormous amount of money, nearly 3 trillion 
dollars, is a mortgage on future generations. While consumers are succeeding
in getting their debt under control, and business is succeeding in getting
it's debt under control, the government continues to borrow and spend as
if there were no ill effects from this process. Government spending is
valuable in areas where private investors fear to tread, but government
debt can't continue to grow indefinitely. It too must be managed in a
sound fiscal way so that future generations will have capital left on
which to operate. Right now the Democrats are paying the interest on
one credit card by charging it on another. That's the road to bankruptcy
and ruin for individuals and nations. A rubber stamp in the White House
can only make matters worse.

>>Again wrong. The Japanese stock market crashed because of world
>>currency fluctuations, the worldwide recession, and the collapse of 
>>a massive speculative boom.
>
>The same answer here. American companies will now have the biggest
>percentage of their talent released from military work. The U.S.
>government has been paying our best companies to _not_ compete with
>Japan. The japanese know that and are concerned that it is over.

Our "best" companies? I don't think so. Our *best* companies, the
ones that have been eating the Japanese's lunch, are companies like
Nucor Steel, Microsoft, Harley Davidson, Apple, lumbering old GE, 
even Japanese railroads use components built by GE, and others who
haven't been busy building $800 toilet seats, $450 screwdrivers, and
coffee pots that can survive a nuclear bomber crash. Companies whose
primary business has been government contracts are the *worst* companies
to compete with the Japanese. They have no concept of how to do cost
effective production. If the Japanese are scared of them, they are much
bigger fools than I give them credit for being.

>The government has to _stop_ spending money. The government has no
>idea of _how_ to spend money in order to make money. They don't
>have the _concept_ of fiscal responsibility.

The government has to stop spending more money than it takes in. Agreed.
However, the government isn't *supposed* to spend money in order to make 
money, the government isn't a for profit operation. The government is 
supposed to spend money to do necessary things that private individuals 
and businesses can't or won't do alone, like provide a national defense
and drive high risk, long return research. The Congress' of the last
50 years have shown little indication that they have *any* concept
of fiscal responsibility. They can't even manage their own checkbooks,
much less those of the nation. That *is* a major problem, but government
does have legtimate uses and we mustn't throw out the baby with the
bathwater. Congress must be reformed and the old tax and spenders 
thrown out before we can get the House (and Senate) in order again.

>If Clinton gets in it will all be pretty much done for anyway. His
>tax policy coupled with his spend policy will bankrupt the U.S.A.
>in 5 years instead of the predicted 10 and space exploration can
>be carried out by what is left of Europe and Japan's industries.

No argument here. Clinton would be a rubber stamp for the half
baked plans of the Democrats in Congress. Bush has done a sorry
job of saying *no*, but Clinton wouldn't even try. A President
has wide latitude in the conduct of foreign affairs, but in 
domestic and fiscal policy, about all he can do is act as a check
on the wilder impulses of Congress, where the purse strings are
controlled. Quayle may not know how to spell potato, but Bush
at least ocasionally knows how to spell veto. If he had a little
more backbone, he'd do it more often. If *we* had a little more
backbone, we'd throw those weasels on Capitol Hill out on their
sorry butts and put some fiscally responsible people in their
place.

Gary
Newsgroups: sci.space