The Era of Living Dangerously

[Ken White]

Ganulv:

Yes, Lenin did part way with Marx -- so have most of Karl's hangers-on. As I said, they have much to answer for...

You make that tension disappear by having the Federal government do the things it is supposed to do and cease doing all the many things that are none of its business. That proliferation of assumed tasks has created an overlarge governmental crowd that doesn't do much of anything well because it is trying to do too much. I say that based on 45 years in uniform and as a civilian working for that government. It generally means well; it always is over-involved. To rid us of that problem we can vote out all incumbents in Congress. Both Parties. Repeatedly. Until they get the message and reform the process -- without that, it will not reform; not seen as in the interest of its politicians and employees -- perspective again.

I'll grant two -- California is woefully suspect other than San Diego to LA. To San Francisco you'll never beat the air time. Rather than trying to force people to do something they likely will not be interested in doing, why not cater to their wishes and simply improve the quo???

True on decisions and those are best made locally. that would be definitely less efficient but we can afford it, we're wealthy but just do not spend well. Local effort is certainly far more effective -- and that, not efficency, is or should be the goal of governance. This nation is simply too large and diverse to adopt one-size-fits-all solutions to satisfy all the Nannies involved. Distressing but there you have it.

No problem with acknowledging full humanity -- that would be guaranteeing equality of opportunity -- but I do have problems with three weeks vacation and a pension at 58 for everyone. Some jobs merit it, all do not and my quarrel is with those who would say all must be treated equally because they are all people. People and jobs are not all equal, never have been or will be until we perfect cloning. Michael Jordan is certainly a far better Basketball player than I. The Cop who puts his life on the line daily deserves different treatment than the soldier who only does that occasionally but who deserves different treatment than the medical professional who works long hard hours but with little danger -- or the Butchers and Bakers who cope with none of the above...

Not only a historical perspective but, too often, just common sense...

motorfirebox:

The goal is not or should not be to create prosperity for the nation as a whole. That it is now a nominal goal is really a part of the problem. "Prosperity for the country" implies (not states, just implies...) a certain equality of outcome. That the implication is having adverse effects on us is shown by your second paragraph with which I agree -- the system has been corrupted and our Political Class has not only allowed that, they have (foolishly IMO) encouraged it.

I'm reminded of this little tale I recently noted:

A doctor, a priest, a lawyer and an engineer are waiting to tee up, but they have to wait an inordinate amount of time. The club pro explains that the foursome ahead of them are firefighters who lost their sight saving children. in a local school fire, and that the club lets then play any day they want. The golfers answer the pro:
Pastor: Forgive my impatience, I’ll pray for them.
Lawyer: Well, the club should give us a discount.
Doctor: Maybe they can be cured; I’ll talk to my ophthalmologist friend.
Engineer: Why can’t these guys play at night?

Quoted from p. 126, "Winning Insurgent War, Back to Basics" by Geoff Demarest , Foreign Military Studies Office, Ft. Leavenworth.

Problem is, of course, that we all see things from our own perspective and self protection is instinctive. In that tale, the four golfers would have worked it out on their own and the 'help' of the Pro would have been unnecessary. My point is that effective leadership and / or politics should account for that perspective issue and arrive at a fair consensus of courses of action. History shows us that such leadership or political acumen is actually and unfortunately rather rare. The counterpoint is that most societies if not unduly manipulated by their government will slowly arrive at a correct balance. In prior centuries a lack of education made the process haphazard and agonizingly slow. Given today's educational capability (as opposed to demonstrated production... ) there's a case to be made for less, not more governmental intrusion as the tendency to get to a satisfactory conclusion is more likely than ever...

The linkage of all this to the Thread is that this era is no more dangerous than any prior era. A strong argument that it is less dangerous due to world wide societal advances could in fact be made.

The linkage to Small Wars is that we do not do them at all well. A large contributor to that shortcoming is that steep declines in US some military capabilities, not offset by known and obvious improvements in other areas of armed forces conduct and equipage, are societally or governmentally induced. The drive toward the equality of mediocrity, excessive concerns with stability and security -- 'force protection' -- and a fragmented government funded by a Congress that has its nose in too many things have had severe detrimental impacts on our education, our training and our performance in too many -- not all by any means, but far too many -- aspects

[ganulv]

You make that tension disappear by having the Federal government do the things it is supposed to do and cease doing all the many things that are none of its business. […] To rid us of that problem we can vote out all incumbents in Congress. Both Parties. Repeatedly. Until they get the message and reform the process -- without that, it will not reform; not seen as in the interest of its politicians and employees -- perspective again.

I grew up on an Indian reservation so you’re preaching to the choir. The irony is that one gets elected to the House (and often enough to the Tribal Council) by promising and proving s/he can milk the Feds to the benefit of the district/reserve.

True on decisions and those are best made locally. that would be definitely less efficient but we can afford it, we're wealthy but just do not spend well. Local effort is certainly far more effective -- and that, not efficency, is or should be the goal of governance. This nation is simply too large and diverse to adopt one-size-fits-all solutions to satisfy all the Nannies involved. Distressing but there you have it.

I don’t disagree with any particular part here, but do think Americans should keep in mind the Federal Government’s role in creating some of that wealth. Not saying it doesn’t do its fair share of standing in the way, but it also opens doors. The current political discourse is focused on the former to the point of excluding the latter.

[Ken White]

We agree on every point. While I didn't address it, no question in my mind that apparent selfishness on the part of voters at all levels has for many years aided Congress and legislative bodies in general in their unending pursuit of venality...

We started educating people to preclude that and -- Hanlons razor here (mostly...) -- in the early 60s we quit, dumbed down 7-12 education to promote self esteem over basic competence and began insisting on a Degree for more jobs than should logically require one. That did tertiary education no favors. I know more than one degreed 20-30 something who's amazingly naive and short on, to me, rudimentary knowledge -- but they can tell me anything I want to know about their I-Pod or the travails of Amy Winehouse. Sad, really. I digress. That educational regression allowed a relapse to the 19th century model of US voting...

I know it's more complex than that but the failures in education are a big part of the flawed politics problem. The good news is that seems to be slowly being retooled.

[Bob's World]

-- but they can tell me anything I want to know about their I-Pod or the travails of Amy Winehouse. .

You run with a pretty hip crowd ...

[Ken White]

You run with a pretty hip crowd ...

They have too much money and too much time on their hands...

[motorfirebox]

motorfirebox:

The goal is not or should not be to create prosperity for the nation as a whole. That it is now a nominal goal is really a part of the problem. "Prosperity for the country" implies (not states, just implies...) a certain equality of outcome. That the implication is having adverse effects on us is shown by your second paragraph with which I agree -- the system has been corrupted and our Political Class has not only allowed that, they have (foolishly IMO) encouraged it.

By "nation as a whole" I don't necessarily mean every individual person in the nation. I mean the average--the whole. Enforcing absolute equality of outcome is bad, but it's just as bad as a system that results in absolute inequality of outcome. There has to be a certain general parity--the bottom end can't drag too far behind the top end, if only to satisfy the demands generational wealth places on equality of opportunity.

The counterpoint is that most societies if not unduly manipulated by their government will slowly arrive at a correct balance. In prior centuries a lack of education made the process haphazard and agonizingly slow. Given today's educational capability (as opposed to demonstrated production... ) there's a case to be made for less, not more governmental intrusion as the tendency to get to a satisfactory conclusion is more likely than ever...

Economically, the idea that too much government is the major source of harm just doesn't fly--our current woes came after decades of stripping government oversight.

[Ken White]

Economically, the idea that too much government is the major source of harm just doesn't fly--our current woes came after decades of stripping government oversight.

I think that the problem was not stripping of government oversight in the deregulation sense but lack of effective government oversight in still regulated industries and sectors at the behest of Congroids who wanted favors for donors and forced Regulators to back off by threatenting their budgets (or adding to same as a carrot...). Our current woes were caused, more than any one thing, by the bundling of mortgages and governmental entities Fannie and Freddy were in the midst of that -- and Congress resisted calls from three Presidents from both parties to clean up that mess. They also protected the SEC in the face of whistleblowers (plural) that tried to warn them of the impending crunch.

Don't forget several Presidnts who overspent deliberately and / or structured governmental responses for purely partisan political purposes...

Add in the plethora of Federal programs that pass money to States, localities and individuals in monumental vote buying schemes. A great deal of the money in those grants and transfers is frittered away on nice to have stuff.

Then there's Medicare and Social Security -- neither of which I particularly need or want; so by spending money on me, someone who needs help isn't getting it -- or is getting less than they should. There's no excuse for not means testing those programs. The Medicare is particularly onerous because even though I do not need it, the system virtually forces me to use it...

Governance failure by design. Whether too much government is the major problem is arguable -- that excessive government IS bad and ineffective government is worse should not be in dispute. Combine the two flaws and you have today's USA. The governmental milieu and its excesses may not be the major problem but it is certainly one of them.

Ain't we got fun...

[Fuchs]

Our current woes were caused, more than any one thing, by the bundling of mortgages and governmental entities Fannie and Freddy were in the midst of that --

The root causes were macroeconomic and easily visible even in macroeconomic abstracts of monthly BEA reports for more than a decade.

Any single institution was merely a cog wheel in the whole.


edit: Blame your media. There are 24/7 "business" channels that didn't devote a single hour in a full decade to these obvious macroeconomic disaster-in-waiting.
Even today they don't appear to explain that the root causes still exist and the whole attention is focused at petty symptoms.


You simply cannot run a nation with -1% GDP net capital investment, +1% population growth, a trade balance deficit equalling a quarter of your goods production and expect it to run 'great'.

[ganulv]

The root causes were macroeconomic and easily visible even in macroeconomic abstracts of monthly BEA reports for more than a decade. […] edit: Blame your media. There are 24/7 "business" channels that didn't devote a single hour in a full decade to these obvious macroeconomic disaster-in-waiting.

Keep in mind that the U.S. is a society in which many parents are resistant to childhood vaccinations—maybe the greatest achievement in human history, as far as I am concerned—because they are convinced they cause autism, and evolution and climate change are also widely portrayed as political opinions. Most Americans seem to understand that alternative hypotheses are part of science, but far fewer seem to understand that strongly held opinions do not count as support for them.

[motorfirebox]

I think that the problem was not stripping of government oversight in the deregulation sense but lack of effective government oversight in still regulated industries and sectors at the behest of Congroids who wanted favors for donors and forced Regulators to back off by threatenting their budgets (or adding to same as a carrot...).

Our current woes were caused, more than any one thing, by the bundling of mortgages and governmental entities Fannie and Freddy were in the midst of that -- and Congress resisted calls from three Presidents from both parties to clean up that mess. They also protected the SEC in the face of whistleblowers (plural) that tried to warn them of the impending crunch.

I don't see how the first doesn't lead to the second. It seems strikingly probable to me, for instance, that not passing the Gramm-Leach-Bliley Act would have either prevented the housing crisis entirely or strictly limited its impact. Fannie and Freddie were the method by which a financial crunch occurred; their involvement dictated that it would be a housing crunch rather than a student loan crunch or a commercial real estate crunch. Lack of effective oversight was certainly a big problem, but to give financial entities carte blanche to completely make up as much wealth as they want is going to have political ramifications. It is hard to have effective financial regulation when you allow the creation of entities which have enough purchasing power to buy the SEC as a conversation piece to mount in the living room. The only solution to that is to limit the amount of wealth financial entities are allowed to spin out of thin air.

[Ken White]

I don't see how the first doesn't lead to the second. It seems strikingly probable to me, for instance, that not passing the Gramm-Leach-Bliley Act would have either prevented the housing crisis entirely or strictly limited its impact.

Why did it pass? Politicians doing things that didn't need to be done because they are impelled to do 'something.' Too often, 'something' that is designed to slip through and cater to a particular constituency that supports one party or the other. The larger the governmental milieu, the easier to hide things.

Fannie and Freddie were the method by which a financial crunch occurred; their involvement dictated that it would be a housing crunch rather than a student loan crunch or a commercial real estate crunch. Lack of effective oversight was certainly a big problem

That's perhaps an understatement. I'd go much further. Protection -- protection, not lack of oversight -- protection of Fanny and Freddie for political / ideological and not practical purposes were not only the method but principal cause.

but to give financial entities carte blanche to completely make up as much wealth as they want is going to have political ramifications.

Of course it is and I certainly am not advocating that -- regulation is needed, no question. What is NOT needed is the political skewing of what gets regulated on ideological grounds as opposed to logical, balanced and minimal curbs on excess.

It is hard to have effective financial regulation when you allow the creation of entities which have enough purchasing power to buy the SEC as a conversation piece to mount in the living room. The only solution to that is to limit the amount of wealth financial entities are allowed to spin out of thin air.

I think you just said there should be no Fannie, no Freddie. I agree. That also means there should be no Bank of America, Citi or J.P. Morgan et.al. in their current forms -- I agree.

Bottom line on all that is big government per se is neutral on these particular economic issues (though not necessarily on different economic and on many other issues...) but that excessive government fiddling, allowed by a government that is too big to restrict its focus to the basics and is thus encouraged to engage in politically oriented tinkering in order to obtain funds or votes and to expand a party's or the government's reach, is indeed the culprit...

[motorfirebox]

That's perhaps an understatement. I'd go much further. Protection -- protection, not lack of oversight -- protection of Fanny and Freddie for political / ideological and not practical purposes were not only the method but principal cause.

I don't see it that way. Fannie and Freddie certainly provided the opportunity, but the opportunity couldn't have been taken advantage of to this disastrous extent without a) the massive capital available to the megabanks that emerged in the wake of the repeal of Glass/Steagal, and b) the criminal complicity of private ratings agencies such as Standard & Poor's. Without those two factors, the actions of Fannie and Freddie would have been harmless or even beneficial.

Of course it is and I certainly am not advocating that -- regulation is needed, no question. What is NOT needed is the political skewing of what gets regulated on ideological grounds as opposed to logical, balanced and minimal curbs on excess.I think you just said there should be no Fannie, no Freddie. I agree. That also means there should be no Bank of America, Citi or J.P. Morgan et.al. in their current forms -- I agree.

The concept behind Fannie and Freddie is a good one--striving to keep the bottom end of the economy from dragging too far behind the top end, as I mentioned earlier. I'm not going to try very hard to defend them in the form they'd taken circa 2007, but I think we do need entities who fill the function Fannie and Freddie were intended to fill.

Bottom line on all that is big government per se is neutral on these particular economic issues (though not necessarily on different economic and on many other issues...) but that excessive government fiddling, allowed by a government that is too big to restrict its focus to the basics and is thus encouraged to engage in politically oriented tinkering in order to obtain funds or votes and to expand a party's or the government's reach, is indeed the culprit...

That's a valid perspective, but I'm not convinced it's the one most suited to fixing our current problems and/or ensuring another 50ish years of relatively uninterrupted prosperity. I generally take the position that there's not enough government fiddling, where "fiddling" is defined as "dragging S&P and Goldman Sachs into the street and clubbing them like baby seals".

[slapout9]

I don't see it that way. Fannie and Freddie certainly provided the opportunity, but the opportunity couldn't have been taken advantage of to this disastrous extent without a) the massive capital available to the megabanks that emerged in the wake of the repeal of Glass/Steagal, and b) the criminal complicity of private ratings agencies such as Standard & Poor's. Without those two factors, the actions of Fannie and Freddie would have been harmless or even beneficial.

Good job!, also nobody has mentioned that Fannie and Freddie had no problems until 1968 I think??? when Nixon privatized them.

[Ken White]

I don't see it that way. Fannie and Freddie certainly provided the opportunity, but the opportunity couldn't have been taken advantage of to this disastrous extent without a) the massive capital available to the megabanks that emerged in the wake of the repeal of Glass/Steagal...

I'll match your Glass/Stegall repeal fiddle with the passage of Title VIII fiddle and raise you an ECOA fiddle.

...and b) the criminal complicity of private ratings agencies such as Standard & Poor's.

Agree totally on that. I also think there's more to S&P in several aspects than has yet come out. I look forward to some actual prosecutions though I suspect the main culprit will skate. Moles are hard to kill...

Without those two factors, the actions of Fannie and Freddie would have been harmless or even beneficial.

We can disagree on that. Fannie and Freddie are both 'remedies' to the fact that the market works but it is admittedly slow and uneven in its effects -- that is anathema to big guvmint types who want absolute equality NOW. Well that's a little hyperbolic on my part -- but Fannie etc. are in fact efforts to speed the market and apply a uniform standard nationwide (Not accounting for the fact that this nation is too large geographically and too diverse demographically for any one size solution to really work well...).

The Fannie / Freddie approach is pandering vote buying disguised as social engineering disguised as economic policy and it is a corrupt idea with corrupt efforts and corrupt protectors in the congress. It is still asking for tax dollars.

The concept behind Fannie and Freddie is a good one--striving to keep the bottom end of the economy from dragging too far behind the top end, as I mentioned earlier. I'm not going to try very hard to defend them in the form they'd taken circa 2007, but I think we do need entities who fill the function Fannie and Freddie were intended to fill.

We're unlikely to find agreement on that. IMO, such entities skew the market and for all the acknowledged good they do, they end in always causing more harm. It is also noteworthy that there are other, better ways to keep that top from getting too far ahead or the bottom from falling too far behind but they require Politicians with testicular fortitude -- those are rara avis.

The real role of Fannie and Freddie (as well as Social Security and Medicare et. al.) is to buy complacency and votes in that order. The social engineering aid to the downtrodden that is the nominal reason for them does exist but it is secondary to wooing the complaisant contributing voter. It is effective because it is hard to counter as concepts and talking points -- who can argue with taking care of the disadvantaged -- but there are two very practical, not propagandistic, things that will mean the death or dismemberment of all those programs. First, they were and are absolutely unaffordable as structured over the last 50 years or so (and most who passed them into law knew that but didn't care because they'd be gone...). Secondly, The insidious harm of dependency and over reliance on a government that absolutely cannot -- not now, not ever -- do all it alleges it can and will do for its citizens is becoming apparent and the natives are becoming very aware -- and quite restless. Both Parties are venal, corrupt and place garnering votes and their interests ahead of those of the Nation and voters are beginning to wake up to that fact. I look forward to the 2012 Election; my guess is there will be blood (figuratively speaking) and the decimation of incumbents, long overdue, will continue. Hopefully, it'll make the 2010 election look like a quiet picnic in the park.

Consider that the directed equality approach as I mentioned elsewhere, does raise boats -- it also lowers some which can have adverse impacts of second and third orders. Raising some is merely attacking the symptoms, lowering too many high flyers will merely create harsher symptoms and can do long term damage. It also enforces mediocrity. Do we really want to do that?

Companies today are sitting on piles of cash but they won't spend due to the chaotic regulatory environment. Not harsh, not overly restrictive (if anything, most are too lenient) but excessive in volume and reach. IOW there is not too much regulation, there are simply too man regulations, a different thing. Instead of regulatory effectiveness we have regulation aggrandizement and proliferation inducing bureaucratic sclerosis. The US government doe not need to prescribe the lighting and sleeping requirements for the quarters provided Goat Herders -- but it proposes to do so...

That's the kind of thing I mean when I said the government does a lousy job of things it is supposed to do (foreign intelligence, diplomacy, defense, policing Wall Street...) because it is too busy raiding Gibson Guitars on the off chance they may have a piece of ebony, finding ways to for the EPA penalize Texas for daring to defy DC, 'No Child Left Behind' (Republican foolishness), fixing No Child Left Behind (Democratic counter foolishness) and magnanimously allowing kerosene lantern to be used for Shepherds and Herders...[quote]That's a valid perspective, but I'm not convinced it's the one most suited to fixing our current problems and/or ensuring another 50ish years of relatively uninterrupted prosperity.[/quote[Hmm. Having looked futilely for work during the recession in the mid 50s, participated to an extent in those of the 70s and 80s I would agree that the "uninterrupted prosperity" is indeed relative...

I generally take the position that there's not enough government fiddling, where "fiddling" is defined as "dragging S&P and Goldman Sachs into the street and clubbing them like baby seals".

Is that fiddling? Not to me, that's merely enforcing the law -- as opposed to deliberately not doing so as a political gesture. Such political gestures and turning a blind eye are fiddling. Fannie and Freddie are fiddling. Repeal of Glass/Stegall and passing of Title VIII are fiddling.

Where's Yo Ma Ma -- er, Yo Yo Ma -- we need a little lite classic on the Cello to offset all the fiddling...

And what, ask many, does Yo Yo Ma have to do with eras of living dangerously. Little to nothing -- but the fiddles of the US Congress, both parties, over the years but particularly in the last 40-45 have contributed to the perception that we live in dangerous times because, simply, it is to their advantage to do so. Fear, real, imagined or manufactured is used by politicians to sow anxiety and suggest that only they can be trusted to bring us through these 'perils.' They try to fix things that aren't broken. H.L. Mencken as quoted in Dayuhan's sig line has it right:

“The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by menacing it with an endless series of hobgoblins, all of them imaginary”

[Dayuhan]

By "nation as a whole" I don't necessarily mean every individual person in the nation. I mean the average--the whole. Enforcing absolute equality of outcome is bad, but it's just as bad as a system that results in absolute inequality of outcome. There has to be a certain general parity--the bottom end can't drag too far behind the top end, if only to satisfy the demands generational wealth places on equality of opportunity.

I don't think anyone would argue against the proposition that economic policy should serve the nation as a whole. What policies will actually come closest to that goal are a matter of some dispute, and many proposals seem to be either clueless, or thinly disguised attempts to advance specific agendas, or barefaced pseudo-populist attempts to play to popular illusions. Frequently they are all three.

Economically, the idea that too much government is the major source of harm just doesn't fly--our current woes came after decades of stripping government oversight.

Our current woes came after a good number of other things as well, and I see no good reason to believe that oversight or lack thereof was the critical factor. There was also a long series of short-sighted policies targeting political advantage rather than long-term economic health. After a fair number of years of watching, I've personally come to believe that sound management of macro incentives achieves far more than oversight... though sound management of macro incentives often conflict with political agendas and is consequently ignored. Both political parties in the US have done their share of that, and both have shown themselves eager to focus blame on the ever-available scapegoat of Wall Street to distract attention from their own rather gargantuan contribution to the situation.

[slapout9]

What happened was this.

"Ike" was spending 12.5% of GDP(Gross Domestic Product) a year on Infrastructure and Taxing Rich People up to 90% of their income. Population about 165 million people.

As of 2009 (or about then) we were barley spending 2.5% of our GDP on Infrastructure and rich people are only paying a 17% Capitol gains tax. Population about 310 million.


Infrastructure back during "Ike" was not just roads and bridges, but electrical grid, water systems,sewer systems,phone company(we used to have one)schools,hospitals,libraries,court houses, and medical clinics. Yes "Ike" was going to provide actual Health Care to people not some phony health insurance company scam(Insurance is a racket). It was gone by about 1965 or so. Oh Yea Cats and Dogs were living together in the same house.

[Ken White]

"Ike" was spending 12.5% of GDP(Gross Domestic Product) a year on Infrastructure and Taxing Rich People up to 90% of their income. Population about 165 million people.

That tax rate was sustained only by the need to pay off the WW II debt, no way it could have or should have lasted much longer; that it produced excess is shown by that 12.5% spending on infrastructure. Not saying that expenditure was bad, just that it was large.

To put that in perspective the 1954 GDP was $2,582.1B (roughly 19.4 Trillion today), 12.5% of that was $322.7B (roughly 2.4 Trillion today)

As of 2009 (or about then) we were barley spending 2.5% of our GDP on Infrastructure...

The GDP in 2009 was only $12.8 Trillion (not 19.4 Trillion), thus 2.5% on Infrastructure was about $320 B, roughly the same amount but from a relatively lower if actually larger GDP (so one could say we're spending more...) -- and we are not building an interstate system, not supporting as heavily an inefficient rail passenger system or, unfortunately, not paying off a massive debt. We have instead opted to spend far more of our money on Social programs to the detriment of things the Federal Government should be doing -- highways, incidentally and as you know, are a State responsibility.

I'm assuming your figure are accurate and just working off them. My experience is that it is really quite difficult to pin down the actual numbers though you can get a broad approximation -- which is good enough for internet discussion purposes. To provide a bit more contrast, if you check this LINKand got to the Outlays by Super function, you'll see that total Federal Outlay in 1954 was $76.1B, Social program spending was 18.5% of the total (including massive Veterans benefits and services, the largest single item as a result of WW II). In 2009, outlays were $3.5 Trillion and Social program spending was 61.3% of that. Different world Slap -- those Ike days are gone and they won't ever come back.

Not to mention that much of the then infrastructure spending was on things now far more in the private sector -- like the grid. Not arguing who should pay, just that comparing the two pots of spending is a bit of apple and orange.

Same thing holds true on your tax rate and population numbers -- then and now have a lot of different parameters.

...not some phony health insurance company scam(Insurance is a racket).

True. You mention that to your Congress critter?

It was gone by about 1965 or so.

Wasn't that when Lyndon introduced the Great Society -- and Medicare???

Fuchs

Blame your media. There are 24/7 "business" channels that didn't devote a single hour in a full decade to these obvious macroeconomic disaster-in-waiting. Even today they don't appear to explain that the root causes still exist and the whole attention is focused at petty symptoms.

True, our pathetic media is almost as responsible for the shape we're in as is excessive government, wrongly focused...

You simply cannot run a nation with -1% GDP net capital investment, +1% population growth, a trade balance deficit equalling a quarter of your goods production and expect it to run 'great'.

Yes. you'd think that would be obvious...

I think it is obvious -- to everyone except our Politicians, both parties, both ends of Pennsylvania Avenue...

[Fuchs]

My experience is that it is really quite difficult to pin down the actual numbers (...)

These things take five minutes for me...

lines 22, 23, 26:
http://www.bea.gov/scb/pdf/2011/08%2...A_Section5.pdf

page 6 (table 3), first line:
http://www.bea.gov/newsreleases/nati...dp2q11_2nd.pdf


Minor revisions are to be expected for the more recent values, the maximum error for 2010 and earlier values should be +/- 2% in worst case, more likely far below +/-1%. (This means per cent for actual aggregated values, per cent points for change values.)


Correction of my previous post: The trade balance deficit is close to a FIFTH of domestic goods production. I got my fractions mixed up (one fifth missing = one fourth more would be needed to close the gap).

[ganulv]

The trade balance deficit is close to a FIFTH of domestic goods production.

Yeah, but my country owns the printing presses for the world’s reserve currency. Though not for much longer if the current crew of elected officials in D.C. keep up their recent behavior.

[Ken White]

These things take five minutes for me...

Thanks for the links. They'll come in handy for beating up on Slap...

Problem I've noted is that statistics of most types are fairly easily located but often, variations in collection and presentation in different periods of time make simple (underline that word -- for us non econometric / math deprived folks) comparisons speculative in many cases.

In short term it's possible to improve the degree of capacity utilisation, but that's not going to suffice...Now that won't happen voluntarily in a country that still believes that consumption (and really almost only consumption) drives the economy...A great success in defeating the symptoms will further fortify the belief in the importance of consumption ...

Witness the Fed's unbelievable position on rates...

and thus grow the root problem, hasten the travel to the next, greater, bust.

Yes. I don't think that result is inevitable -- but it is, sadly, the most likely...