Showing posts with label politics. Show all posts
Showing posts with label politics. Show all posts

Monday, April 15, 2013

Stampy and the Brain

On Tuesday of last week, Arianna Huffington posted an article titled "Brain Dead: Why Is D.C.'s Answer to the Jobs Crisis a Deficit Solution?"  In it, she addresses a critical problem that's been sitting on America for the past five years: our mountainous unemployment.  She asks why a proposed debt crisis solution should be thrown at slow economic growth.  Clearly, the White House is ignoring the elephant in the room!  Clearly.  Except that it's not.

For as long as Super Capitalism drives American investors, there really isn't much that the White House can do to quickly resolve the issue.  Absolutely, people should cry foul when 20 million Americans are out of work, but the forces that drive policy must be considered on a larger scale.  Without fully understanding the context, frustration with seemingly obtuse policy measures will only result in more frustration.

It all began in 1958, when Bank of America issued the first modern credit card, and American banks jumped on the credit bandwagon.  Debt became a very popular product, very quickly, and banks could hardly sell it fast enough.  If you were making money, why not get more money by guaranteeing it against the money you will surely be making in the days to come?  Inflation grew at an alarming pace, and the only way to buoy it was with more debt.  More credit.  And it scaled internationally.

As of the writing of this article, the US national debt is approaching 17 trillion dollars, and it's been growing by almost 4 billion dollars a day since 2007.  2013 minus 2007... six years... That massive debt growth seems to have been a clear harbinger of our current job crisis, and it echoes our annual fiscal cycles exactly.  Until it slows down significantly, there aren't going to be 20 million jobs to be had in America.  There can't be.

Who does America owe all this money to?  While it's true that China holds the largest portion of foreign money owed (a cool 8%, and that's nothing to shake a stick at, but it may be something to shake a South Korea at, but that's for another post), the biggest chunk of American debt is owed to the Social Security Trust Fund, some 30% of 16.8 trillion dollars. Next up in the list is America's investors.

And that's where Super Capitalism comes in, just the bullet train we need to hit that brick wall at the end of the tracks at supersonic speeds.  Unless, somehow, the White House can offset that deficit.  Unless, somehow, Obama can apply the brakes indirectly without super-profit-obsessed investors really noticing.  Maybe, just maybe, by trying to rally the troops with a well-worded (if rather equivocal) speech about headwinds and dual purposes.  In short, Obama is putting a pretty bow on the only hope we have of getting back on our economic feet, and he's calling it exactly what it is.

In the world of politics, pundits and thinkers are trained to look for the double talk, the deception and the back alley dealings.  While there's plenty of prestidigitation in the proposed debt reduction plan (it's not a glitch, it's a feature!), that's all it is: a debt reduction plan.  Like an ion sail, it will be slow to gain speed, but as long as the super-profit evangelists don't notice, it will eventually do its job and help to correct the devastating effect debt sale has had on our nation for the past 55 years.

But, if it doesn't work, debt will break America's back, and Capitalism will fail.  No joke.  Google it.

So what does that mean for the next 10 - 20 years?  It means that the US will continue to implement the socialist policies needed to keep 20 million+ Americans living at a minimum standard.  It means nouveau riche investors will continue to go where they feel their money can grow at the alarming rates seen during the Tech Boom of the late 90's/early 2000's, and that means going where the labor is cheapest.  Remember how saturated the market was with tech support from India?  The employees there felt the kiss of cash and demanded more pay, more rights.  It got expensive, and the Super Money moved on.  For now, it's got a really nice home in China.  But even Foxconn can't maintain its Super Profitability forever, and the Super Money will move on.

Eventually, an increasingly socialist and destitute America will become the overall least expensive source of cheap manufacturing.  Eventually, the Super Money will come back home, but not before we've frantically sold off most of our essential liberties in an effort to keep it here.  For as long as business law is designed to keep profitable companies profitable, for as long as investors retain majority ownership of America, that's the only serenade we can offer.

Obama proposed a debt reduction solution in the midst of a critical job crisis.  Is he ignoring the elephant in the room?  Isn't he in touch with America's needs?  Perhaps more than most people realize.  His proposition isn't brain-dead at all, but in fact, is the only hope we have of breaking our addiction to debt.

Thanks for reading!