For many years, economics in the U.S. has been approached with a ‘game show’ mentality. Wild and backwards speculations on financial growth have become the norm. The daily ‘Wall Street Journal’ and ‘Washington Post’ musings of international bankers and their servile lackeys are treated as divination, rather than the bamboozle they actually signify. If you play along and contribute to the mechanics of the great casino, then you are treated as a “serious” economist or analyst, regardless of how many times your advice has been completely off the mark, or how many middle-class nest eggs you destroyed in the process. If you question the conclusions of the pundits and talking heads, or, God forbid, question the validity of the system itself, you are immediately marginalized as a “kook” or “conspiracy theorist”. The workings of the mainstream financial world are more inbred than Hollywood and Washington D.C. combined.
Cable news providers like MSNBC and CNN have set the American people up for fall after fall; sometimes because they were blinded by their own bells and whistles, sometimes because they deliberately and blatantly lied in order to create engineered market sentiment. In the wake of the initial credit market collapse of 2008, these people, who didn’t see it coming and denied it was happening, still have their jobs, still have their TV shows and news columns, and, are still generally blowing smoke up our posteriors.
Have economists made themselves irrelevant? If you have any doubts, have a look at the current issue of the magazine, International Economy, a slick publication endorsed by former Federal Reserve chairmen Paul Volcker and Alan Greenspan, by Jean-Claude Trichet, president of the European Central Bank, by former Secretary of State George Shultz, and by the New York Times and Washington Post, both of which declare the magazine to be “ahead of the curve.”
The main feature of the current issue is “The Great Stimulus Debate.” Is the Obama fiscal stimulus helping the economy or hindering it?
Princeton economics professor and New York Times columnist Paul Krugman and Moody’s Analytics chief economist Mark Zandi represent the Keynesian view that government deficit spending is needed to lift the economy out of recession. Zandi declares that thanks to the fiscal stimulus, “The economy has made enormous progress since early 2009,” an opinion shared by the President’s Council of Economic Advisors and the Congressional Budget Office.
“The sleekest revolutions,” notes Barry Lynn, “are won not at the barricades but in the dictionary.” To control the terms of a debate is to control the outcome. This is certainly true of the term “free market,” a term which has come to mean almost its opposite, and hence a system which is manifestly unfree. The claim that our markets are not free is a serious one, and should only be made on serious evidence, just the kind of evidence that Barry Lynn provides in Cornered: The New Monopoly Capitalism and the Economics of Destruction.
The surest sign that a market is free is that it is competitive; there should be a rich variety of products provided by a vast number of firms, a situation which affords entrepreneurs many opportunities to enter the market and workers many places to sell their labor. And when we waltz into our local Wal-mart, that is what we seem to see. Alas, it is an illusion of competition rather than the reality. For example, if you want eyeglasses, you can go to Pearl Vision, or Lenscrafters, Sears Optical, JC Penney, Target, Macy’s, Sunglass Hut, or buy frames from 25 different manufacturers. Surely choice and competition prevail in this market. But no. All of these are one company, the Italian conglomerate Luxottica. And as with glasses, so also with so many other products. Most of our beer—even some that try to pass themselves off as “craft” beer—is provided by just two companies, ImBev of Belgium or the South African Brewing Company. Proctor & Gamble provides 75% of razors, 60% of detergent, 50% of feminine pads, etc. Even what few companies remain in each market often engage in collusion rather than competition. Wal-mart, for example, appoints one company as a “category manager” to allocate shelf space for all the “competing” companies.
In the grand scheme of history, in the great wash of the collective American cosmos, in the midst of the day to day howls and earth rattles of towering financial and political giants, many of us tend to see ourselves as “the little people”. We consider ourselves inconsequential in the wake of epic events that appear to rise and fall like irregular tides and determined by some frenetic force of chance; a great cultural roulette wheel. In fact, we are often encouraged to emulate this belief. Better to roll with the river of difficult times than to fight against the current in a fruitless attempt at changing its direction. Better to let more important and more powerful men blaze the trails that we will later follow, right…?
Human beings have a strange attachment to the concept of the “decision makers vs. the decision followers”, even in the U.S. The Declaration of Independence was meant to herald the birth of a society which dissolved the separation between the rulers and those who are ruled. Our country was built upon the premise that every citizen has a right to participate in the making of his own providence, to play a part in the decisions that directly or indirectly affect his future. Of course, those were the days when average Americans saw themselves as giants, as innovators of history, not as little people.
“From now on, depressions will be scientifically created.” — Congressman Charles A. Lindbergh Sr. , 1913
Everyone loves money. Even people like myself who abhor the abuse of money and commerce, who understand the fraudulent nature of the system we live in, still work hard and save so that we might attain a sense of stability within that system. Many people see money as a focal point to their existence. But is it really money that they are after, or is it something else entirely? In truth, money represents ‘security’ in the minds of the masses. Money affords us the ability to survive, and the more of it we have, the safer we all feel. Because we subconsciously associate the extension of our very life with the variable health of the economic structure in which we live, we tend to become unwitting devotees to its continued existence, even if it is corrupt and condemned to failure. We gullibly deny the system or the currency that supports it is doomed to the contrary of all evidence because, even though it has beaten us bloody, we have never known anything else.
In light of this entrenched way of perceiving things, especially in the U.S., it is difficult enough to convince some people that the economy is in fact not providing the security they desire, but is actually destroying their future completely. To explain to them that this is deliberate, that the economy is designed to self-destruct, that is another prospect altogether.
Federally-backed program aims to help outsourcers in South Asia become more fluent in areas like Java programming and the English language.
Despite President Obama’s pledge to retain more hi-tech jobs in the U.S., a federal agency run by a hand-picked Obama appointee has launched a $36 million program to train workers, including 3,000 specialists in IT and related functions, in South Asia.
Following their training, the tech workers will be placed with outsourcing vendors in the region that provide offshore IT and business services to American companies looking to take advantage of the Asian subcontinent's low labor costs.
If you have any doubts about how easy it is for someone who works hard in the US to get ahead, consider this factoid from Martin Wolf’s latest comment in the Financial Times, on Raghuram Rajan’s new book (see Satyajit Das’ review here: )
Thus, Prof Rajan notes that “of every dollar of real income growth that was generated between 1976 and 2007, 58 cents went to the top 1 per cent of households”.
As the U.S. economy continues to implode, large American corporations are investing billions upon billions of dollars in China. But all of this investment comes at a price. Over the past several decades, hundreds of factories and manufacturing facilities that would have been constructed in the United States, along with millions of decent paying jobs, have ended up going to China instead where labor is so much cheaper. In the process, China has become a massive economic powerhouse, while once thriving manufacturing cities in the United States such as Detroit are now rusted-out corpses. In fact, China’s economy has grown so rapidly that it is being projected that in 2010 China will replace Japan as the world’s second-largest economy. Not only that, but China has already overtaken Germany and is now the biggest exporter of goods in the entire world. But none of this growth in communist China would have been possible without all of the globalism and free trade that U.S. politicians from both parties have been pushing on us for the last 40 years. When they were selling us on the benefits of “free trade” they didn’t tell us that we would end up shipping our economy, our jobs and our prosperity over to China.
Before the 4th of July weekend, there was unreported maneuver in the Senate designed to protect BP and the federal government from liability in the Gulf disaster.
Senate Democrats asked unanimous consent to pass legislation that would give the BP Oil Spill Commission the subpoena power it needs to do its job.
