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Why Obama’s Economic Plan Will Not Work—And a Better Plan
Obama's economic recovery plan will not work. It does not begin to address the profound structural problems that hobble the U.S. economy and that amount to a slow-motion death sentence for the American middle class. His policies are the equivalent of trying to re-float a sunken boat, nothing more. Once the government buoys are removed, the boat will promptly sink again, with the American people trapped inside.
If Obama wants to revive the American economy, he needs to adopt a much more aggressive program than has been contemplated to date. Specifically, he needs to address the chronic shortfall in workers' incomes and the recent collapse of middle class wealth which are the root causes of the crash. The most effective way to do that is with a Manhattan Project-like program to reconfigure the way the nation uses energy.
Such a program would be surprisingly inexpensive, especially when compared to the $14 trillion dollars handed to the banks in the recent bailout. It would not only resuscitate employment and incomes and, therefore, American living standards, it would revive American competitiveness in the world, reduce its dependency on Middle Eastern oil, and improve the economy's impact on the environment. In all of these ways, it would prove a huge boon the American people and the world.
Fortunately, there are many precedents for such an ambitious program. They include the U.S. itself in the 19th and early 20th centuries, 19th century Germany, and 20th century Japan, Korea, and China. These are the most impressive cases of economic transformation in the last 200 years. In each case, activist government intervention allowed the economy to exploit a new technology paradigm and catapult itself to new heights of prosperity and growth. A similar such opportunity is available to the U.S. today, but only if the Obama administration finds the courage to act.
The US economy is profoundly damaged. It is no longer intended to provide a stable and rising standard of living to the mass of American people. Rather, since 1980 and the election of Ronald Reagan, it has been operated with the goal of transferring income and wealth from the working and middle classes to those at the very highest reaches of the economy. And it's been extraordinarily successful at this.
Here is the executive summary of U.S. economic policy over the past 30 years:
Dramatically lower taxes on the wealthiest people in the country; meanwhile, undercut the working and middle classes by shipping their jobs overseas so corporations can profit by paying Chinese and Indian workers 5% of what they pay American workers; send the finished products back to the U.S. and sell them to former workers with now-downsized jobs by getting them to take on onerous levels of debt; when that is still not enough to keep the economy afloat, have the government increase its debt, in the process binding those former and downsized workers with government debts that they will carry for the rest of their lives; have the whole system laundered through big banks who create nothing, but take a piece of the action on every transaction; make sure these banks are "too big to fail" so that when they fail, the downsized, indebted workers can be made to disgorge the last of their remaining assets in order that the banks and their owners don't suffer any losses on their predatory investments that went bad.
Repeat this process until the working and middle classes have been milked of all of their assets and their wealth has been transferred into the hands of the richest people on earth.
It's working exactly as planned.
Between 1993 and 2007, 50% of all the growth in the U.S. economy went to the richest 1%. Between 2002 and 2006, it was even worse: an astounding three quarters of all the economy's growth was captured by the top 1%. In 2007, this top 1% captured 20% of all the income in the entire nation. The top 10% corralled fully half of all the income earned in the entire country, as much as the bottom 90% combined. Only one time since 1913 has so much of the nation's income been seized by such a small elite. That was 1928, the year before the stock market collapsed, ushering in the Great Depression.
The data on concentration of wealth are even more startling. The top 1% own more than 50% of all assets in the U.S. They own more than 70% of all financial assets. Meanwhile, the bottom 50% of wealth holders own a mere 3.5% of all the assets in the country. The bottom 40% own nothing. They have a combined net worth of zero. Middle class homeowners now own less of the equity in their homes, 45%, than at any time since World War II when the figure stood at 70%. They lost $13 trillion in the housing meltdown, even as the entire past decade produced zero net new jobs.
So where are we now?
Seven million high-paying manufacturing jobs have been shipped overseas in the past decade, one third of all those in the entire economy. Twenty per cent of the nation's labor force - thirty million people - are idle or underutilized. Thirty percent of the nation's factory capacity is idle. Three quarters of the nation's home building capacity is idle. More workers are out of work longer that at any time since such statistics started being collected, in 1948. The results are cataclysmic.
Ten thousand homes enter foreclosure every day. More than 39 million Americans - one out of eight - are on food stamps. Half of all American children will be on food stamps at some point in their lives! Seventy-seven million Baby Boomers stand on the threshold of retirement, expecting, hoping, praying that the nation will honor the promises it has made to them for the last 50 years. It will not, because it cannot.
The national debt that stood at $1 trillion in 1980 now stands at $12 trillion. And this was run up over a period of supposed economic prosperity! Personal debt has risen from 65% of income in 1980 to 125% today. The nation's unfunded liabilities - debts it has committed to pay but for which there is no identifiable source of funding - exceed $65 trillion. The U.S. economy must borrow more than $5 billion every day just to keep its lights on. Most of that comes from foreign creditors-China, Japan, Saudi Arabia and such. Interest payments on this debt will soon reach $1 trillion a year. Not since before the Civil War has the U.S. been so dependent on foreign capital.
When all the assets that are pledged as collateral against this borrowing have been exhausted, the lights will go out, as they must. The creditors will simply pull their capital out of the economy as they did from the Asian countries in the Asian financial crisis of the late 1990s. The U.S. has become a banana republic, ruled by a small, ultra-rich oligarchy who look after themselves, with everybody else living entirely at the mercy of their wealthy masters.
Despite Obama's cheesy rhetoric and faux-liberalism, his economic program is, in fact, little different than that of George W. Bush. More than $14 trillion have been committed to the banks in the bailout but only $135 billion have been committed to the automobile industry. That's $100 to the banks that wrecked the global economy for every $1 devoted to the "real" economy, where real people live and work. This ratio played out exactly in December when, on Christmas eve, Obama, with a wave of his magic pen, increased funding for Fannie Mae and Freddie Mac by $400 billion. Later, he begrudgingly relented on an additional $4.5 billion for GMAC. Once again, that's $100 to the banks for every $1 to the automobile companies and their workers.
This policy reaches its abusive extreme when the government allows banks to borrow unlimited amounts from the Federal Reserve at 0% and then re-loan the same money to maxed-out credit card holders at 27%. Or, with the same banks opening their own payday lending arms to milk truly desperate borrowers with interest rates of 400% or higher. If the front door of the looting operation was the $14 trillion hand-over during the bailout, this is the back door, out of sight but ever so effective because, with everybody hooked on debt, they have no alternative.
So what should we do instead?
What we need is a national program equivalent to the Manhattan Project that built the atomic bomb in only 4 years. It is a program to create high paying jobs that can restore lost middle class incomes and create the wealth to pay down the massive debts run up over the past three decades. We can have such a program for $1 trillion, less than one tenth of what we've wasted bailing out the banks for their destructive, larcenous, unrepentant, sociopathic greed.
Here's the program.
The federal government should commit $1 trillion to refitting the U.S. economy for dramatically more efficient energy usage and improved energy generation. This is less than one tenth the sum it has committed to bailing out the failed financial services industry. Half the money should go for transportation, one quarter for residences, and one quarter for energy generation.
In transportation, the government should commit $100 billion to development of the most energy efficient automobile in the world, one that can achieve 200 miles per gallon and be produced in volume and sold for $15,000 apiece. This is within reach of existing technology. All component manufacturing and assembly would be required to take place within the United States.
It should then spend $400 billion in incentives to spur Americans to buy the cars. If each automobile carried an incentive of $7,500 - half the price of the car - the $400 billion would make possible the purchase of 53 million such automobiles. The program would extend over five years for an average of 10.3 million cars a year. In 2008, GM sold 3 million cars in North America while Ford sold 2 million. Chrysler and foreign manufacturers could make up the difference, provided they manufactured in the U.S. The program would replace a sizable portion of the U.S. automobile fleet.
At the same time, the government should announce irrevocable, gradually escalating taxes on gasoline. For three years, the gas tax would increase by 5 cents per month or 60 cents per year. After that, it would increase by 10 cents a month. In five years, gasoline would cost $4.20 more per gallon than whatever the market price of gasoline was. This would provide consumers both the incentive and the planning horizon to make the move to the new cars.
Such an investment would employ millions of skilled workers in the design, manufacturing, assembly, and service of not only the cars and their parts, but of the vast infrastructure that would be needed for electrical recharging at homes, businesses, and shopping centers. The private investment for such infrastructure would readily emerge in response to such guaranteed massive demand.
The program would make the U.S. the highest volume, lowest cost producer of fuel-efficient transportation in the world. It would drastically reduce the $400 billion we spend each year importing oil from the Middle East. And with U.S.-based manufacturers licensed to export the cars to other countries, the trade deficit, which has averaged over $500 billion a year for the past decade, would be eliminated entirely.
A similar such program should be implemented for doubling the energy efficiency of the nation's homes. A $250 billion program would allow 25 million homes to be upgraded with a $10,000 federal subsidy for everything from insulation and windows to water heaters and electrical appliances. Additional impact would be achieved by tying the federal subsidy to an equal investment by the homeowner. The success of the recent $8,000 homebuyer's subsidy indicates the huge potential for such partnered investment. It would be all the more certain and powerful if the government announced an irrevocable, staged increase in energy taxes similar to that for gasoline.
As with the transportation program, such an investment would employ millions of skilled housing tradesmen who are now idle and have very few prospects of employment in the future, given the vast overhang of empty and foreclosed properties on the market. And again, with all the new materials manufactured in the U.S., additional stimulus would occur for American factory workers and the communities and services that support them.
Finally, the last $250 billion should be invested in energy generation. The government should undertake a program to provide a $5,000 subsidy for homes and businesses to install their own electrical energy generation capacity. That would create 50 million generators of diffuse, environmentally clean energy that was not subject to terrorism, centralized failure, or economic blackmail by monopoly producers. Households could sell their excess power back into the system to earn revenue for the life of the equipment.
As with the transportation and housing components discussed above, the monies would be provided as a matching subsidy so as to stimulate an equivalent or greater amount of private investment. They would occur in the context of guaranteed, gradually escalating energy costs for the economy as a whole. Such a program would generate millions of jobs for skilled tradesmen in the design, manufacturing, installation, and services industries and millions of more jobs in the industries that support them.
Once again, the full cost of the program would total $1 trillion, less than one tenth the $14 trillion sum the government has already committed to the failed banks, which are not generating new jobs and are not even loaning the bailout money back into the economy. The three investment programs would employ tens of millions of now out-of-work tradesmen in the collapsed manufacturing and home building and the new energy generation industries. Indirect employment, in adjacent support industries, would amount to millions more. The programs would stimulate hundreds of billions of dollars of ancillary private investment that would seek to capitalize on the newly redesigned national energy infrastructure.
In addition to substantial improvements to employment, incomes, and middle class wealth, the program's other benefits are many, significant, and broadly shared. It would:
- Dramatically reduce the nation's dependence on imported oil, paying for itself in reduced trade deficits alone;
- Reduce the need for the U.S. to occupy the Middle East, with all of the provocations to terror that are attendant on that occupation;
- Save hundreds of billions of dollars a year that is now directed to the military in the effort to maintain control of the world's oil supply;
- Enable pay-down of personal and national debts, freeing hundreds of billions of dollars a year in interest payments that go to the wealthiest people in the world;
- Finally, the plan would dramatically reduce carbon consumption from the U.S. economy and, indeed, the entire world.
In all of these ways, the program would more than pay for itself many times over. Energy Reconfiguration would dramatically transform the very nature of the U.S. economy, and, indeed, U.S. society.
But would it work? Both history and economics suggest it would.
Every major growth phase of the U.S. economy over the past 200 years has been accompanied by three things: 1) a new generation of industrial technology-from railroads to automobiles to electronics; 2) government assistance to lay the foundations of growth; and 3) a build-out of the technology that employed tens of millions of working people. The results in every case were dramatic and successive increases in jobs, wages, and living standards. Consider the facts.
The railroads were built in the 1800s with massive government land grant subsidies. They catalyzed a vast array of adjacent technologies and industries, from engines, steel, and precision parts to machine tools, coal, lumber, and more. The still larger economic effect was to create the world's first continental-scale markets in everything from food and sundry goods to home appliances and industrial materials. This allowed American producers to become the highest volume, lowest cost producers in the world. The impacts were astounding, dwarfing anything the world had ever known.
In 1800, there were no railroads in the US. The US produced less than 1% of the global GDP and held 3% of its wealth. By 1900, there were more than 250,000 miles of railroads. The U.S. was producing 24% of the entire planet's GDP and held almost 50% of its wealth. U.S. workers were the highest paid, wealthiest workers in the world and formed the market for the next wave of industrial revolution, which the U.S. also dominated, the automobile.
It was the German engineer, Rudolph Diesel, who invented the internal combustion engine but it was Henry Ford who made it a mass phenomenon. The reason was not, as we're told in the conventional mythology, Ford's assembly line, but the fact that federal, state, and local governments built roads and highways, without which the automobile was worthless. As with railroads, cars set off an explosion of demand in adjacent industries, in steel, rubber, glass, paint, chemicals, asphalt, road-building equipment and more. They created entirely new markets that had never existed before: tire and repair shops, gas stations, malls, drive-through restaurants, and the whole panoply of culture we know as suburbia. Average real U.S. incomes rose 10X during the 1900s.
The final example is the computer industry. As with railroads and automobiles, the core technology was invented by private initiative-by William Shockley at Bell Labs in 1947. But it was the government's guarantee of demand through the defense department and space programs that gave private manufactures the assurance to truly ramp up production, driving down costs by factors of hundreds. Similarly, it was the government that underwrote the invention of the Internet, graphical user interfaces, and a dozen other advanced technologies that are ubiquitous today and that account for much of the improvement in national productivity we've experienced over recent decades.
Similar explosions in national economic power accompanied other nations' purposeful use of guided industrial investment. In 1850, Germany held 3% of the world's wealth, compared to 59% for the United Kingdom. Over the next 60 years, while the U.K. followed its ideological fetish for "free markets," Bismarck and Germany practiced intense national industrial targeting. By 1910, Germany had blown by the U.K., garnering 21% of the world's wealth to the U.K.'s 14%.
After World War II, the Japanese government carried out the most extensive program of national industrial strategy ever undertaken. They targeted the steel, shipbuilding, machine tools, automobile, consumer electronics, semiconductor, and other industries with the intent of becoming the highest volume, lowest cost producers in the world. They succeeded in every single case. In 1946, Japan produced a total of 50 automobiles. Last year, while General Motors went bankrupt, Toyota became the largest car manufacturer in the world.
We could go on and on. Taiwan, Korea, Singapore, and now China all use such targeted national investment strategies to accelerate industrial transformation and boost their own national industrial gladiators to the realms of the world's largest companies. In 1960 Korea had the same per capita GDP as Ghana. Today, as a result of its highly disciplined national industrial policies, its people enjoy one of the highest standards of living in the world. Its industrial gladiators dominate many of the world's leading industries, from ships to cell phones to semiconductor memories.
Some will protest that the government shouldn't be in the business of national industrial targeting, that it should leave investment decisions to the "free market." Such an argument is historically wrong, empirically naïve, and logically false.
The historically wrong argument is made above. The most dramatic instances of economic transformation in the modern world have all involved activist government policies. The charge of "empirically naïve" flows from the fact that the U.S.'s major industrial competitors practice aggressive industrial policy. China, in particular, manipulates its currency, subsidizes exports, extorts leading edge technology from foreign investors seeking access to its markets, and more. To imagine this is not happening and that the U.S. faces a level playing field is simply dishonest.
Most important is the logical fallacy of the free market argument. Our choice is not between free markets and industrial strategy; it is between different industrial strategies. The U.S. government already practices national industrial policy. It enacts a broad and reinforcing array of policies that favor banks, oil companies, insurance companies, weapons makers, and the oligarchs who own them at the expense of the rest of the economy, especially its workers.
The inescapable, damning fact is that the industrial strategy we currently practice benefits the few while destroying the environment. The one proposed here benefits the many while doing much to protect the environment. The political implications are perhaps even more stark. Supreme Court justice Louis Brandeis said, "We can have great concentrations of wealth, or we can have democracy. But we cannot have both." Our current set of industrial policies are already costing us both our economy and our democracy. Unless they are changed we will lose both.
At the heart of this vision lie three essential truths: 1) the era of cheap, plentiful energy is over; 2) the nations that adapt to this fact will prosper while those that do not will fail; and 3) continuing our present course is a consignment to economic and political suicide. We can choose an energy-efficient infrastructure and the policies to create it, ones that create broad-based prosperity and economic independence; or we can stay with a wasteful, obsolete energy infrastructure and a set of policies that are leading quickly and irreversibly to a modern feudalism, where very few own everything and everybody else lives at their mercy. We can dither and deny, wait and whine, but those are the choices.
71 Comments so far
Show AllNothing will change until the dragon called Corporate Personhood is slain. Look at what it has done to Obama's HealthScare.
Obama allowed himself to be sucked into the dragon's mouth, and society at large is and will be paying for it for a long, long time. No tears here for Obama.
Dream a little dream.
Some of this makes sense in terms of the concentration of wealth at the top
and the need for Green Energy investments to maintain a decent life.
But a major flaw!-
AUTOS ARE THE PROBLEM NOT THE SOLUTION!
We are running out of oil which is what precipitated the financial crisis when
gas hit $4 gallon and all the McMansions in the middle of nowhere were unsustainable.
Autos account for 70% of our oil usage and 30% of greenhouse emissions just on
the face of it. Actually autos have other huge hidden costs in terms of swaths of
land wasted on huge highways and parking, 40,000 deaths a year and hundreds of thousands of injuries, and tons of asphalt, a petroleum product, which has to be used
to maintain the roads at huge expense.
Electric cars are not going to resolve these problems.
Europe and Japan use 1/3 or less of the energy we do - why? because they have
mass transit and trains.
More investment in autos is the totally wrong direction.
We need to run trains and buses ,revive abandoned rails and replace highway lanes
with light or heavy rail wherever possible.
The suburban sprawl nightmare federal policies in collusion with vast interests of
real estate, auto companies, oil companies is unsustainable.
"When all the assets that are pledged as collateral against this borrowing have been exhausted, the lights will go out, as they must."
hey - that's collateral damage for you.
"The data on concentration of wealth are even more startling. The top 1% own more than 50% of all assets in the U.S. They own more than 70% of all financial assets. Meanwhile, the bottom 50% of wealth holders own a mere 3.5% of all the assets in the country. The bottom 40% own nothing."
"Supreme Court justice Louis Brandeis said, "We can have great concentrations of wealth, or we can have democracy. But we cannot have both."
Freeman identified the problem, the capitalistic class system, but his solution doesn't address it, but merely acts as a prop to keep the immoral system moving forward. It will supposedly elevate the u.s. in the global competition.
Mostly, he is talking "greener" jobs, a good thing for the struggling middle class. The half off sale of the 200mpg cars will be subsidized which passes some of the cost to the poor through taxes. Same with the on site electric production. Are the landless going to install solar collectors on the landlords building or their tents?
The lower 40% would still be landless, saddled with debt and the wealth will continue to funnel to the 1%.
If you carefully listen, some good points are made. Your quote on Justice Brandeis is as the British Say "Spot on".
Our Government must begin to operate as it was intended, as a Democracy. The Constitution guarantees a Republican form of Government to the State as a political subdivision of a Nation. The principles of Democracy established in our Declaration of Independence are seminal. They inform the operation of these political subdivisions as members of a Federal Union.
Many members of our National Legislature act on the belief that our National Government is a Republican form of Government. Under this philosophy, “sovereign will” is transposed to the judgment of the elected and abused. We are left with a Government that lies, whose deed is not consistent with its word. That position is ultimately destructive, whether it is practiced by Government or Individual.
America yearns for a Government that acts as it talks. The process of defining our government must come first. Once deeds become consistent with words a national unity will emerge sufficient to meet the challenges of the future. We must become the Citizen envisioned in our Declaration of Independence and guaranteed in our Constitution.
I hope this comes true. I agree that it would revolutionize the country for the better. To be adopted, it needs mass, progressive support, and I fear that the Faux-News coopted 'free marketers' will oppose its implicit 'socialism'.
"...only if the Obama administration finds the courage to act". But unfortunately we live in the land of Oz where instead of a fearless leader we have a cowardly lion at the helm. Obama is going to go on doing what he's been doing for the past year. Toothless growls at the banksters when public rage builds up - and you can see how much that intimidates them, they don't even show up at his meetings. It's like he's a dog on a leash, except that he's scooping their poop.
But he has the corporate media on his side, keeping the public in the dark. The only thing the public knows for sure is that it's broke and things aren't getting better in spite of what the media is saying.
The comparison between FDR's first year in office and Obama's first year in office is stark. And heartbreaking. Obama has betrayed all those idealistic young people who came flooding out to work and vote for his election. I still find it unbelievable that he filled the henhouse with the same foxes who took down the economy in the first place. And their behavior hasn't changed. They're still opposed to serious regulatory reform as stifling to the free market "economy". Nobody is talking about reinstating Glass-Steagall. Not even a year later. That should have been step one.
So yes, Robert Freeman, it's a great plan, but we won't get it. Instead the plundering will continue, aided and abetted by Obama.
When the people fear their government there is tyranny,
when the government fears the people there is liberty.
~ Thomas Jefferson
We the people have to decide if we are in accord with the trending toward third world status that our governments policies inevitably produce.
Both 'Humbaba' and 'Buck' make excellent points but they are merely symptomatic of the real problem, in my opinion. This nation is run , not for the benefit or betterment of its citizenry, but to assist the corporations in their blind search for ever more profitability.
Whether one thinks 'corporate personhood' a bad idea, or notes the shrinking of the Middle Class and the migration of the dollar to fewer and fewer, or rails against the cost of winning an election, the overreaching concern remains the loss of our constitutional guarantees and the subversion of our democracy.
When it takes seven hundred million dollars to ascend to the Presidency, when a Senate seat runs about ten to twenty million, we the people take a back seat to we the corporate donor.
Yep, reality rules.
In my weird fantasy world, The law should be fully and fairly enforced in spirit, If they have the rights of person-hood then by the logic of justice they also carry the liabilities and risks of person-hood.
That would be an effortless way for some supreme court justices to overturn the tables, and mysteriously die from ruled suicides.
Ambitious New Deal program. Fantasy of course as long as we let the Corporate State maintain the status quo. Pity, the program might actually work. Though I am surprised no money was allocated for repairing the infrastructure, not even the railroads. Surely that presents good jobs and necessary projects as well. If we are to take advantage of the new energy generation we need to re-vamp the electrical grid.
Gary
As Einstein is alleged to have said, problems cannot be solved by the kind of thinking that created them to begin with. But that's exactly what Freeman is urging we try, here.
It's always the details that make the difference.
Freeman errs when he says the chronic shortfall in workers' incomes and the recent collapse of middle class wealth are the root causes of the crash. These are symptoms. The root cause is the fact that we have a privatized currency - a debt-based monetary system subject to interest.
To paraphrase the lesson learned from Naomi Klein's essay yesterday, it is that we must look at systems, not symptoms. This is what I found most noteworthy in her reflections on her own post-"Battle of Seattle" work.
"Looking back, what I liked most was the unapologetic wonkery of it all. In the two years after No Logo came out, I went to dozens of teach-ins and conferences, some of them attended by thousands of people, that were exclusively devoted to popular education about the inner workings of global finance and trade. It was as if people understood, all at once, that gathering this knowledge was crucial to the survival not just of democracy but of the planet. Yes, this was complicated, but we embraced that complexity because we were finally looking at systems, not just symbols."
Likewise, in this post-economic-crash world, we should be striving to understand the big picture of global economics. Unfortunately, our "economists" are obsessed with symptoms and almost never discuss or even mention the essence of economic life - money; our currency or monetary/banking system and the monetary policies that go with it. Our current monetary system, with a privately controlled central bank (The Fed) that controls both the nation's currency and its monetary policy, is based on debt-based currency subject to interest and this is what makes it an effective engine of extraction and concentration of wealth.
So the essence of our crisis of governance - of our entire political economy - can be traced to the anti-democratic design feature at the core of that system, namely, that the currency has been privatized. A currency is the essence of a political economy because it is the very enabler of market relations. If its nature and use is controlled by private interests, which it is, then those interests have the entire political economy by the proverbial balls. As Mayer Rothschild is notoriously quoted, "Give me control of a nation's money and I care not who makes her laws." So when Naomi Klein writes that the economic model that dominates around the world has revealed itself not as "free market" but "crony capitalist", this is what she's talking about. At the apex of the pyramid of cronies are the central bank bankers.
Such is the reality of our plutocracy. The monetary/banking system, privatized by means of that insidious piece of stealth legislation, the Federal Reserve Act, is not intended to be the foundation of an economy that serves the population; it's intended to be a reliable method of wealth extraction and concentration. And it works. Except that in the end (very close at hand) the monetary system collapses and takes the entire economy with it.
So I admonish Robert Freeman and all other professional and celebrity commentators to speak to this essential system flaw. The creation of the Federal Reserve was likely the greatest single act of industrial privatization ever - privatizing the very essence of economic life, currency. It should be treated as such. And we need more popular education about the usurpation of our natural and constitutional rights to interest-free currency, not endless hypotheses about what a new government program might do for the economy.
Federal reserve is an issue, but not the only one. My personal view is that FED, in its current form, must be abolished. To put it somewhat pompously, the right to coin money must be returned to the people of the US, acting through their elected representatives. The FEDs successor can only have a role of auctioning the newly created money supply to the highest bidder with a banking license, and policing the banking license. Government can inject money needed for interest through direct spending. This way, interest rates are set by the markets, not by some kind of central planner. Will not prevent bubbles entirely, but will limit them.
Robert Freeman raises an important point, however. The role of government in the economic transformation. By my reckoning, he is essentially right. I am not sure that I would push taxes on energy quite this high, and, the part on energy generation shows a green bias. I would add nuclear energy to this mix. It can be made clean and safe with new technologies; it is workable if we stop irrational scare campaigns. I think that distributed energy generation is a nice goal, but it will not work for quite some time to come. Particularly with new industrial activity raising energy use. Remember this, every time you buy a chinese made item, you are getting some chinese coal with it. If you return industrial production to the US, energy use will go up, not down.
I would add one more thing to his article. Globalization, taken at its most benign, is an attempt to "cut and paste" western industrial civilization upon all of humanity. This can not work because of resource constraints. I do hope that extending some kind of prosperity to all of humanity is possible, though I am not actually sure of that. To make this prosperity happen, significant technological transformation must occur. Markets are slow to deliver this transformation, and seem to create deepening chaos which can lead to wars over resources. He may very well be right, that only industrial policy can work.
As I understand the situation with nuclear energy is (1) It takes a lot of fossil fuel to make a nuclear plant and its fuel. (2) Concrete is used by the tons forsuch a plant and the production of concrete is a good source of CO2. (3) The time to build enough nuclear facilities will take years. (4) The amount of uranium 235 is limited, and the use of U238 and Thorium are systems that have not been proven. Over all nuclear seems to be "hail Mary" in footballeze.
France has been generating 80%+ of its electrical energy from nuclear for decades now. Even US is generating 20%. The development of nuclear power in the US was thwarted for two reasons: hysterical, propagandistic opposition, which was very reminiscent of red agitprop which I experienced in my youth (socialist Poland), and US$ as world reserve currency. The latter meant that US could get oil at preferred prices. This is coming to an end, and rapidly. As a result, US is very vulnerable to currency collapse, which would cause an enormous price spike, which could even lead to social disintegration.
The fact that the French were able to make their nuclear energy work, means to me that the French are better able to balance the individuals right to be heard, and the societies need to function. Time is rapidly approaching when the US will have to learn to strike a better balance as well.
The problem of unsafe reactors has been largely solved. The problem of nuclear waste can be easily solved, if we refrain from hysterics. The problem of limited fuel supply has not been entirely solved, but there are possibilities. They should be tried, rather than dismissed as unworkable. Only the government can try them, private industry will not take this risk, and it probably does not have sufficient capital anyway.
US will need to electrify significant portions of its transportation network. the energy for this has to come from somewhere. nuclear is one of the available options.
I'm not saying that the Fed is the only issue, just the most fundamental one. In short, why should one expect any economic plan to work if the economic system being tweaked is based on a monetary system that is self-destructive? At best you'll get short-term symptomatic relief. And our monetary system is self-destructive because it is debt-based and subject to interest. Interest inherently and irreversibly multiplies debt until terminal debt occurs and the monetary system collapses, taking the whole economy with it.
As for your second point, it's true that the government has an important role in economic transformation. But again one must consider who is running the government. Capitalist cronies who have no interest in serving the public or even allowing the public to serve themselves. As is pointed out, U.S. economic policy for the past 40 years has been to export our manufacturing base. Tens of millions of Americans have thus been forced to live beyond their means because they have no means. They've easily succumbed to using the financial tricks that the financial industry has offered because there was no sound economic alternative. Coming up with a plan to change all that without having a plan to change the policy-controlling Crony Capitalist system we're suffering under is just spinning one's theoretical wheels.
Your conclusion, that "He may very well be right, that only industrial policy can work" is exactly what I'm denying. It's like insisting you can make a defective computer program operate correctly by loading a software update, even though you know that the operating system won't allow the update to install. Freeman's plan won't install.
We need monetary system and monetary policy change first. Take the power over currency and monetary policy away from the cronies, then and only then will you have even a theoretical chance of redesigning the superstructure of economic policies.
we definitely have a point of disagreement here. Fixing monetary system is critical but, by itself, it will not restore the industrial base. Paradoxically, by itself, it may deepen the crisis, because it will further remove demand which is still being created through credit. Imagine that FED is gone tomorrow. What would be the reason for shifting production of anything back to the US? The reason for taking it out was cost of labor and cost of environmental regulation, as long as repatriation of profit was assured, and cost of transport was reasonably low. The big picture is: unregulated capitalism does not work. Mind you, that the present monetary system did work for some time, as long as it was reasonably well regulated.
Mind you, that the present monetary system did work for some time, as long as it was reasonably well regulated.
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Imagine a lake with a noxious weed that can double its spread every month, killing any waterborne life that can't escape. To control it, a large number of people are stationed around and on the lake, and by vigorous work with flamethrowers and machetes, they nearly always manage to keep it from advancing, though when they slip up and it increases in area, they sometimes can't get it killed back to where it was. But the leader of the containment crew proudly proclaims that "regulation is working" because it hasn't yet taken over the lake.
Would you agree with him? I wouldn't.
I didn't say that fixing the monetary system by itself will restore the industrial base. I said that we should attend to fixing the monetary system first, because the financial system is the heart of the economic system, and the private control of it is therefore the number one limiting factor on the viability of any proposed "economic plan."
Currency is the essential technology for a market economy. It is a social construct that can be well-designed or poorly designed, depending on one's aims. For the plutocracy it has proven to be an immensely profitable design, since it creates self-multiplying debt out of credit at virtually no cost to the bankers. This has made it the engine of all the extraction and concentration of wealth that Freeman documents. But it is profoundly anti-democratic, as well as inherently self-destructive, so I see it as a dismal failure. I steadfastly deny that our monetary system has ever worked, in the sense of being constitutional (interest-free currency) and consistent with the principles of political democracy. As per the earlier post by Buck, " 'Supreme Court justice Louis Brandeis said, "We can have great concentrations of wealth, or we can have democracy. But we cannot have both." ' "
To varying degrees the U.S. has always been a plutocracy, though this fact has been disguised by varying degrees of financial industry regulation.
Hi Jim,
Insane capitalist concentration of wealth occurred BEFORE THE FED WAS INVENTED. In fact by some standards it was worse. The original John D. Rockefeller owned about 3% of the nation's wealth before 1913, when the FED was minted, with other robber barons not too far behind. Bill Gates today owns less than 1%.
The strangulation of the world by wealth will only end when private corporations have been replaced by worker and community co-operatives. The workers and neighbors who do that will be able to figure out a sane banking system. In the Mondragon co-op system in Spain, for example, the bank is controlled by representatives from individual co-ops.
In the meantime, in the U.S. the private corporations who own the country will devise any financial or governmental apparatus which best inflates their profits.
Sure, extravagant capitalist concentration of wealth existed prior to the Fed's creation. But the Fed really institutionalized capitalist control of the political economy. Owning various means of industrial production was nothing compared to owning the means of exchange and credit with absolutely guaranteed interest. In short, with control of the central bank in private hands the federal treasury itself was privatized.
Boy oh boy, those boys (Senator Nelson Aldrich, head of the National Monetary Commission, A. Piatt Andrew, Assistant Secretary of the Treasury, Frank Vanderlip, president of the National City Bank of New York, Henry P. Davison, senior partner of J.P. Morgan Company. and Charles D. Norton, president of the Morgan-dominated First National Bank of New York, Benjamin Strong, also known as a lieutenant of J.P. Morgan; and Paul Warburg, a recent immigrant from Germany who had joined the banking house of Kuhn, Loeb) in 1910 on Jeckyl Island must be rolling on the floor of Hell right now laughing on how the Federal Reserve has taken over the fiscal system as well as the monetary one. After all, they created it.
Be very afraid.
Gary
I owned a pallet manufacturing company and labor was always a big chunk of my operating costs. I was always trying to bring it down to remain competitive on my prices. So, I looked for labor among mexicans who were eager to work, worked longer hours and produced more. The jobs left because Haitians or Koreans or Mexicans work cheaper and the cost of labor is reduced. I am no longer in the Pallet Business. I'm too old to compete that hard anymore.
Jim Eldon
"The root cause is the fact that we have a privatized currency - a debt-based monetary system subject to interest."
At last a comment on the core truth. But the problem is not simply the Fed but private banks, starting with the Bank of England created in 1694 until it was nationalised in 1946. The Bank of Canada was nationalised in 1938 but in the 1970's private capital twisted the arm of our government into borrowing from private banks, so that the interest went into private pockets rather than back to government as profits from the Bank of Canada.
At least 95% of our currency is created by private banks (out of thin air, as debt) and subject to compound interest that can never by found due to the nature of money as debt. This inconvenient truth is explained in two films, money as debt and money as debt 2 available on youtube.
Like you Jim I don't expect the current system to last more than 2-5 years. Not bad really since the fiat currency will have survived for around 40 years since it went off the gold standard.
>>Then once we are on this system of REAL money, you will see the WARS come to a grinding halt, because there is no longer a printing press for them to use to supply themselves with WAR Machines, etc.<<
Actually we went off the gold standard under FDR -- it was the SILVER standard we went off of under Nixon. But point taken.
Gary
Let's see, why do we give all the money to the top 1%? What is the rationale? I remember, and I remember that both parties bought in to it hook line and sinker, -- We gave them the money because they would be wise enough and prudent enough to reinvest it in America-- and create even more wealth. I assume that if you gave it to ordinary workers, "they would just piss it away on booze, gambling and whores." (Andrew Carnegie's infamous statement) Who still believes that fairy tale? Barrack does. And so does more than half the Congress-- and so does most of the Senate. And so do most of the challengers to the seats at risk. Democrat Joe Sestak, "the real Democrat" challenging Arlen Specter says about Health Care reform for instance, "I believe that the private market can more efficiently distribute Health care resources than the Government." Bob Casey, the current Democratic Senator who beat Santorum by 20 points ingratiates himself to a hissing group of teabaggers at a town hall meeting and says, "I hate government run Health Care just as much as you do." Jason Altmire (rep 4th Congressional PA district) tells a group of 200+ Single Payer advocates at a Town Hall meeting, "You'll never get single Payer through Congress in my lifetime." Repeat similar quotes when financial refom becomes the topic. Expect them to worry much more about the deficit and talk about cost reductions for federal programs. They aren't going to stand for an active government policy to grow the economy-- the market will take care of that. With Democrats like these who needs Republicans.
Raise the minimum wage and make it a living wage. The price for fast food will sky-rocket and less people will buy that stuff and get obese. In the end healthier, happier people with time to spend with their families and money to spend on leisure activities plus the added benefit of a lower medical burden.
I've been trying find which article to post this on, but since this is about economy and jobs, in a way, let me post it here. This is about the USPS -- which I personally think is being "thrown under the bus." Here is my tale of woe and why I may be forced to pay extra to get my work since I can no longer rely on the USPS.
I work as a legal transcriptionist. I have never met the people from the small company that I work for. They're in NJ, I'm on Long Island, NY. I studied and traveled down to Trenton to become certified -- you must certified to transcribe for the courts of NJ. I have been working for this small company since '97 (there are less than 10 of us, 4 people in the office and the rest of us independent contractors). Anyway, for most of that time my work has been sent Priority Mail. For a while, shortly before the Great Recession hit, they were using FedEx. Priority Mail has been used for the past six months, which was not a problem until November 2009 -- specifically Thanksgiving week. I have always gotten the work either the next day or the day after -- without exception.
On the Tuesday before Thanksgiving work was sent out to me Priority. I did not receive it until the Monday after Thanksgiving. I had no work and thus no paycheck that week. I was unable to pay my utility bills that month, plus the work I get has deadlines, and there were a couple of expedited cases in there, so when I got the work I had to work extra hard. However, I will never be able to make up the hundreds of dollars in lost time for that week.
I am now sitting here typing this because I am about to lose another week of pay. Work was sent out Tuesday and still has not arrived. With the MLK holiday I have no chance of working again until late Tuesday evening (my mail comes late in the day). I have no way of tracking it, so I don't know if it's even lost.
My son's father, who does direct mail, has had the cost of three Express Mail deliveries refunded because the deadlines were not met by FedEx, who handles Express Mail for the PO. He found out this was the case because FedEx puts Express Mail on low priority next to their overnight deliveries.
I could have lost only one day of work had I taken the LIRR to Penn Station and the PATH to NJ, picked up my work and come home again. I am going to propose to the people that I work for that I will split the difference between the cost of Priority and FedEx or FedEx two day. What else can I do at this point? With the loss of work this week I am now going to have massive trouble paying the utilities again and my portion of the rent. I lost at least $1,400 to $2,000 worth of income since Thanksgiving.
I am beginning to wonder if the USPS is not being deliberately destroyed to make a "government-run" entity look bad. The cuts are deep. The second shift at our main processing facility on LI has been shafted. I believe we desperately need the USPS and this should not be happening. Does anybody remember Obama's disparaging remarks on August 11, 2009 regarding the USPS? He used it to attack single-payer health care. Anyway, I ran across this letter from an angry constituent about this attack on the USPS and I'll link to it as food for thought:
http://www.prweb.com/releases/2009/08/prweb2767464.htm
Finally, it's in the letter, but here is the salient quote from the letter with Obama's quote. The whole letter is worth a read:
"President Obama, in a town hall meeting in Portsmouth, New Hampshire on August 11th, 2009, made some disparaging remarks about the U.S. Postal Service in an attempt to support his health care plan. President Obama stated, "I mean, if you think about it, UPS and FedEx are doing just fine, right? No, they are. It's the Post Office that's always having problems."
Also, many, many small businesses use priority mail, especially craftspeople who sell on places like Etsy. It's an easy service to use. I just got a sale from my store on Etsy, but I'm having reservations on sending it out priority on Tuesday. It's going to CA. I used to have decent sales from CA and I've been impressed by Priority delivery there -- three days tops. But if I can't get my work shipped from NJ to NY reliably in two days, why should I expect a package to CA to make it there by Memorial Day? I know that I'm exaggerating on this -- at least I hope so -- but you know what I mean.
It boils down to GREED IS GOOD vs. THE WELL BEING OF ORDINARY PEOPLE. The power of corporate forces fuels the well being of the greedy not of ordinary people.
I love these guys who write these fantasies from their fucking tax payer financed Ivory towers. I'm jealous, I wish I was smart and was a Fool Prof. at some elite University like him. I'd write up these Utopian fantasies all day between Coffee breaks and vacations. Next.
I don't want to get between you and your 'love', but the rest of us are feeling a fair amount of 'pinch' right about now and are looking for solutions. Freeman is quite specific as to both the problem (wealth inequity) and the solution (Manhattan energy project). And what are we getting from you? A side order of sarcasm? As long as you're posting, what's your Utopian fantasy solution?
The article puts forth a great idea, and one that is based in history. it has a great chance of working, and even if it only succeeds half way, it will still be a good thing for the country. FAR better than throwing our money at the banks so they can give themselves obscene bonuses.
But the problem is that the conservatives have worked really hard for the last 30 years to destroy everything that had been built up before, and they won't let it go easily. they worked and worked to rob people of their jobs, livelihoods, and futures, and they somehow feel like they deserve those ill gotten gains. They wont give it up without a fight of unseen proportions.
If they want a fight, I say we give it to them. There are FAR more of us than of them, and it's time they woke up to the fact that we are mad as hell and aren't above taking them OUT of the game if need be. It's time this country learned a lesson from the French. If you allow these people to live, they will come back again and again and screw you again every time. Look at Cheney, who was the Wormtongue in the Nixon administration telling the paranoid one that "it's not illegal if the president does it". Why do you think that W's pronouncements sounded so Goddamned familiar? it's because we heard them all before. And thanks to the same shit headed piece of human filth that gave them to us the first time.
Until we get rid of the "conservative" ideas that have destroyed this country, we will never make a single bit of headway. Just what the hell is it that they are trying to "conserve", anyway? It isn't anything that I grew up with. They are trying to destroy everything we had, and have done very well at it. I say we get our heads out of the sand, realize that war was most definitely declared on us 30 years ago, and act accordingly. It's time the rich and ultra rich get what is REALLY coming to them.
Unless free trade is changed to fair trade, and insourcing and outsourcing severely curtailed, we will have nothing to offer debtors in return, except military hardware, land and other 'hard' assets, and perhaps corn. The big question is: how long before they demand payment?
THE AUTOMOBILE IS OBSOLETE.
The real challenge facing the world is will we have the foresight to rebuild our societies from the ground up to address the challenges of the future, or will we be doomed to fail by trying to salvage existing technologies that are obsolete? Attempting to build a 200 mile per gallon automobile is the epitome of trying to salvage a technology that is obsolete.
The automobile, as the primary device for human land transportation, will no longer be viable in the very near future. There are two primary reasons for this, foremost is the reduction in the production of petroleum and the resulting skyrocketing of gasoline prices. Secondly, as real income for the majority of Americans falls the percentage of their income they can spend on transportation will decrease.
There are yet other very important reasons to reexamine our transportation system; as long as autos and trucks have gas pedals, brake pedals and steering wheels they are inherently unsafe. Every two years automobiles kill as many Americans as died in the Viet Nam War.
In addition it is simply ludicrous to transport thousands of pounds of steel, glass and plastic to transport one or two people, finally pneumatic tires, when compared to steel wheels on rails are very energy inefficient. The rail company CSX boasts that it can transport one ton of cargo 427 miles on just one gallon of fuel in a an advertising campaign that is currently appearing on TV.
At our current levels of computing power, communication technology, motion detection capabilities, GPS capabilities, along with carbon fiber, titanium, Kevlar and other super strong component technologies a transportation system rebuilt from the ground up could reduce energy consumption for transportation by 80% or more.
First, by eliminating virtually all crashes the weight of cars could be reduced by more than half, to eliminate crashes the vehicle would need to be controlled by computers integrated with GPS, motion and range detectors, wireless communications and a locally centralized computing system that would balance traffic flow with the available routs. Placing the vehicles on light rails would make it much easier for the computerized control system, instead of using a steering system vehicles would be switched from rail, to rail, to rail to arrive at their chosen destination.
By employing state of the art materials like carbon fiber, titanium and Kevlar weight could then be reduced even more. Secondly, by eliminating gridlock stop and go driving, energy consumption could be reduced by nearly half again. By elimination crashes soccer moms would no longer think they needed giant SUVs to keep the family safe so the size of transportation vehicles could be greatly reduced and by eliminating pneumatic tires another significant reduction of energy consumption could be achieved.
Without the steering wheel brake and gas pedals people would no longer “drive” instead they would punch in the address they wanted to go to and the computerized navigation and switching system would do the rest, charting the quickest route while balancing with the larger picture of traffic flow. People would then be free to get a head start on their work, browse online catalogs while on the way to the mall, text their friends, surf the net watch TV or truly listen to music. Reducing the stress of driving would go a long way to reducing stress levels of the nation.
Just as transportation technology will need to be addressed from the ground up so will the rest of the technologies of our current economy. All energy sources from fossilized carbon must be minimized. Energy from wind, solar, micro-hydro, tidal, and biological sources need to be greatly expanded, but in such a manor that environmental impact is minimized. The “commons” such as the air, the oceans, flowing water and the few remaining habitats unaffected by humans need to be protected vigorously. Population growth must stop and be reversed.
Even with these radical changes there will be severe effects on the environment of planet Earth as a result of the damage already inflected on the biosphere. These impacts must not be used as reasons to not address the problems facing the future generations of mankind.
Right out of a SF movie. Who is paying for the command grid to drive those automatic cars when we can't get potholes fixed?
Nice pipe-dream however. The car is around for a while longer with idiots at the wheel.
Gary
ECONOMICS 1A
"Obama's economic recovery plan will not work."
It is not designed to work.
"If Obama wants to revive the American economy . . . "
He does not want to revive the American economy.
"The US economy is profoundly damaged. It is no longer intended to provide a stable and rising standard of living to the mass of American people. Rather, since 1980 and the election of Ronald Reagan, it has been operated with the goal of transferring income and wealth from the working and middle classes to those at the very highest reaches of the economy."
This is what Obama and the Democrats want. Will this cost them elections? They truly don't think so. The non-stop, 24/7 lying and propaganda barrage of the permanent campaign that now constitutes politics in the United Straits of America is, according to them, invincible. It worked in '08 and they absolutely expect it to work again.
Don Henley - "You're driving with your eyes closed, and you're gonna hit something--that's the way it goes."
Shiblikov nail-guns the thing on its head once again.
Obama's economic plan is working PERFECTLY for the short list of plutocrats for whom it has been planned, implemented and carefully protected from regulatory oversight, investigation and prosecution of its related and massive frauds. There is absolutely no coincidence whatsoever that all the WORST aspects of the economic and foreign policy of Bill Clinton, George W. Bush and Barrack Obama have been smoothly and seamlessly connected and continuous regardless of the damage they have inflicted on America's working-classes and the spreading under-class.
In a related post to a CD article re: what AIG is still keeping secret for the big banks and neo-liberals, one of the posters mentioned Brooksley Born, the former head of the Commodity Futures Trading Commission in Clinton's second term. PBS Frontline devoted an entire hour to her failed attempt in the late 1990s to get derivatives trading regulated. At that time the global market in derivatives was estimated to be in excess of $500 Trillion dollars. This was before the Housing Bubble was inflated and kited around the world with multiple re-selling of falsely credit-rated, bundled collateralized debt obligations (CDOs)--just one form of derivative.
The way in which these falsely rated, bundled mortgages were sold and re-sold was so self-incentivising that EU and oil sheik market players got in on the act and kited them further. Every time these bundled debt obligations were sliced, diced and resold it added an additional degree of separation between the originator of a given mortgage contract and the end purchaser of a bundle of thousands of mortgages in the form of serial numbered contracts. These leveraged "obligations" thus became increasingly difficult to enforce--to the degree that America's tax-payers, foreign lenders and other nations' tax-payers were ultimately put on the hook for them.
When Ms. Born tried to raise the issue of the need to regulate derivatives in order to gauge the size and potential of this wild west market for massive fraud and abuse she was swiftly hammered by Alan Greenspan, Robert Rubin, Lawrence Summers and the head of the SEC. After they publicly humiliated her before Congressional hearings, Congress passed laws signed by Bill Clinton to further deregulate banks, commodities and derivatives trading.
The hidden deals brokered within that global derivatives black market are still being cut outside any regulatory or direct Congressional oversight. Many of these deals are secret two-party deals. This is anti-competitive, and conducive to secret attempts to corner, fix prices and/or monopolize markets in certain goods and commodities, including leveraged debt and market side bets (based on insider knowledge or casino capitalism) as to how various possibly highly corrupted markets will perform over time. This is because the broader open market lacks sufficient data pertaining to these potentially very powerful secret transactions and so cannot confidently determine market values on certain goods & commodities that may be suddenly and adversely affected by the actions of the various shady players in the derivatives black market.
But the core of the danger here is that this subterranean plutocratic banking brothel is viewed by arch neo-liberal devotees of Milton Friedman as crucial to their failed theory that a functioning post-industrial economy in a 1st World developed nation the size of the U.S. can be sustained based on leveraged, multiply re-packaged and re-sold debt while ignoring our rapidly dwindling domestic manufacturing base in favor of stock market returns from government subsidized, offshored U.S. manufacturing (and the willingness of the American sheeple to tolerate open-ended bank handouts used to speculate on this market). The neo-liberals are desperately clinging to this systemic (and I believe systematically enacted and long sought) economic & political corporate class betrayal of America's working-class and are trying to extend the TARP give-aways to inflate a second market bubble (rich in dubious derivatives deals) instead of doing the hard work to rebuild America's domestic middle-class manufacturing sector jobs (which would require them to completely re-negotiate the "free trade" regime among other things).
What makes this situation all the more dangerous now is that the banks know no matter how dirty or how big the deals are that may blow up in America's face, the tax-payers and foreign lenders will be on the hook for them and the bankers are insulated from investigation, serious re-regulation or prosecution--and rewarded with bonuses in this Devil's bargain. This is an incentive to speculate on an even faster and larger scale with other people's money.
It's not only propaganda and lack of information about what the democrats are doing that will ensure they continue in office, but the DELIBERATE extremism/insanity of the republicans that will frighten most voters into voting democratic. Either way, the corporations retain control.
But the dems have pretty openly shown contempt for the electorate and it seems obvious they care not a whit about keeping their positions since they're working for those cushy board positions they'll be getting once they leave office.
This all makes good sense, but it assumes that corporate persons are 'American', or somehow beholden to some flag or other.
As I see it the game has been a global one for my entire life, and it is specifically concepts such as those embodied in our (trashed) Constitution which remain an obstacle to global corporate fascism. What little remains of it won't last, and I don't expect any 'national effort' such as the Manhattan or Apollo Project to appear which might empower the masses and preserve democracy. If there were any technological revolutions which might enable them to utterly and completely dominate all life on this planet, to the exclusion of the rest of us, you can be sure we'd be seeing just such a 'national effort' as the Manhattan Project.
There are those for whom empowering everyone, setting them free from 'the grid', as well as from debt, is nothing more than taking power from those who only see it in terms of a boot on the neck. It is a sickness to be sure, but even if every person on this earth were to become self sustaining and self reliant - free of any want or need, those that truly fear (and hate our) freedom will oppose it with their last breath. They do this because they set the example. They know what they themselves have done with freedom. They used it to step on our necks.
I think the suggestions wrong headed. Certainly improving energy efficiency a good thing, but transforming over to a new Fleet of Automobiles is not.
Thats hundreds of millions of cars to be built. Where will all the resources come from?
There was a study done on that Clash for clunkers program wherein it was demonstrated that pulling older vehicles of the roads to be replaced by newer more fuel efficient ones was NOT net increase in energy efficiency.
Quite the opposite. The total costs in energy to MANUFACTURE the new cars, to obtain the ore and raw materials to contruct those new cars vastly exceeded the savings that would have been accomplished by pulling older vehicles off the road.
Yes a transfromation is needed. But not one based upon transforming a consumer economy into a lets consume more economy.
>>>>>The US economy is profoundly damaged. It is no longer intended to provide a stable and rising standard of living to the mass of American people. Rather, since 1980 and the election of Ronald Reagan, it has been operated with the goal of transferring income and wealth from the working and middle classes to those at the very highest reaches of the economy.
"Well, that's the whole idea," chant the joyous elite 1% who run this entire operation.
This is a good statement of the problem. A rational plan could ensue from here that would satisfy Free Enterprise and permit Government a modern role in the affairs of its citizens. You didn't get to this in a vacumn, flex your muscle, we've got to get going. Don't just enjoy your intelligence, share it!!
" * Dramatically reduce the nation's dependence on imported oil, paying for itself in reduced trade deficits alone;
* Reduce the need for the U.S. to occupy the Middle East, with all of the provocations to terror that are attendant on that occupation;
* Save hundreds of billions of dollars a year that is now directed to the military in the effort to maintain control of the world's oil supply;
* Enable pay-down of personal and national debts, freeing hundreds of billions of dollars a year in interest payments that go to the wealthiest people in the world;
* Finally, the plan would dramatically reduce carbon consumption from the U.S. economy and, indeed, the entire world."
Excellent. All we need to do is convince Americons that their "Free Market Inc." won't do it by itself.
sorry to burst your bubble, but we do NOT live in a Free-Market society. We live in one of a Corporatist kind, or as Mussolini put it, FASCIST.
NAFTA and CAFTA and the WTO are all the Opposite of FREE-Markets.
The name Free-Market gets used quite a bit, but it is NOT a Free-Market. Thats just how they are able to Demonize the word.
We should try a REAL free-market one day, in this country, but first we have to get rid of the Oligarchs and the Bankster Elites. We have to pull the plug on the Counterfeiting industry, ie the FEDERAL RESERVE. And we need to listen to our Constitution and adapt a sound money system, one that cannot be manipulated by the Government. We need to reinstate the Free Coinage act and or at least offer the option of competing currencies.
Then, we will see if people choose to use Inflated Paper money that is devalued or if they choose to use real money, commodity based money, silver and gold backed money. Then once we are on this system of REAL money, you will see the WARS come to a grinding halt, because there is no longer a printing press for them to use to supply themselves with WAR Machines, etc.
This, and only this is a Free-Market. NOT the system we live in today. That, at best is called Cronie-Capitalism. It's NOT even Capitalism, it's Corporate Welfare, supported by US!
>>Then once we are on this system of REAL money, you will see the WARS come to a grinding halt, because there is no longer a printing press for them to use to supply themselves with WAR Machines, etc.<<
Don't know what you are smoking but get a better supplier. History is full of wars with "real" money in place.
Gary
I think we should change the "what are you smoking" cliche for "what are you drinking"
Sorry about that but had just been reading the report about "ending the drug war" and how much some folks pay for trash-weed. So it was on my mind. But how is "drinking" less of a cliché? Perhaps "ingesting" instead?
Gary
Where is my anti-gravity car? Stationed in Europe my Austin-Mini got 40 mpg in 1967.
My 2003 Pontiac Vibe with the Japanese engine got 32 when new. Progress, I do not think so.