Sunday, August 28, 2011

The Real Jobs Problem

It's the economy, stupid. 


Well, yes, it always has been, if you're in the distortion field of politics. 


But whose economy? The pundits, the White House, the Republican candidates all miss the mark. They keep talking about debt, taxes, and monetary policy. None of those things tell the real story behind today's economy. 


The Old Economy
Keynes was right--in the old economy. Economy gets weak, pump some money into the economy through public works projects, which 


1) puts people to work, which 
2) boosts the economy and 
3) generates new tax revenue, while 
4) leaving us with another generation of reliable infrastructure to support 
5) more growth (for growth's sake, which is another post). 


The Beach Ball
Imagine a beach ball, partially deflated to represent a recession. Got it? Now imagine the govt pumping that beach ball back up through sensible public investment (which we haven't seen for decades).

The New Economy

Same beach ball, same pump, but it's not re-inflating. Why?

The sides are blown out. No, I'm wrong: the sides have 2 knife wounds in them, inflicted by--wait for it--our own government. That's right, your government. Which ain't yours anymore.



Whatever do you mean, Mr. Crystle? 


The "air" in the beach ball is economic activity. Since the signing of GATT in '93, and then NAFTA, and the endless AFTAs thereafta, the government--your government, though you don't own it anymore--has facilitated and even encouraged the largest transfer of economic activity from US soil to other countries since its founding some time ago when electricity was just trickling down to a key on a string.


Our economy was relatively self-contained. And then, the salesmen arrived. In droves. 


"Free Trade," they exclaimed. As they sold you down the river, or rather, across the Pacific and Rio Grande, they convinced you that Free Trade will save and even increase your job opportunities, all you needed was training to bridge you from your Old Economy job skills and job--since moved offshore by the Free Traders--to your New Economy job. 

Except it was a plank, not a bridge. Or a bridge to nowhere. 



They argued that by building up Communist China's middle class, we'd be able to sell our products and services there, and everything would be just great. 


But they left one thing out: our products (and more and more, services) are now made in China, Viet Nam, Indonesia, Mexico, etc, etc. 


Oh, so what we really need is innovation! Yes! That will save us!


Well, our most innovative company--which does a great job of refining other companies' inventions and making them much better (iPod, iPhone, iPad, for instance), inscribes on its products, "Designed in California". 


But made in China


So why would the Free Traders do such a thing, eviscerating the middle class, stagnating wages, weakening towns and cities across the country? 


Profit over country. Profit over democracy. Profit over your rights. Profit over the rights of the developing world's workers. 


The degradation of our economy is decades underway.  GDP has become a false measure. So has the DOW and other indices. They don't measure how you and I are doing. They measure leveraged economic activity with a Designed in USA label slapped on to add insult to injury. 


Bush celebrated increased productivity as a testament to the strength of the economy. Well, yes, productivity goes up when you lay off workers but sell the same end product. How do you get the great opportunity of putting people out of work? 


Outsource. Productivity is the measure of output per employee. So if you can't increase your output, cut your employees.

The 1,000 people that made the part that goes in the car are expensive. So let's get a 30% discount by going to trade violator communist China, charge the same to the customer, and book a productivity increase while pocketing the difference. 



Dire Straits used to have it right with "Industrial Disease":
wanna have a war, keep our factories
wanna have a war, keep us on our knees
wanna have a war, stop us buying Japanese
wanna have a war to stop Industrial Disease
But we have wars--Yemen, Libya, Iraq & Afghanistan.

The war economy is booming--defense contractors are loving our 4 conflicts. Every immoral, civilian-killing drone gives them over a million bucks of future orders. They should sell caskets too--package deal.



I'm frustrated with our national politics. As a country, we've bought into American Exceptionalism, but I don't see us as exceptional. I see the monied class--left, right, whatever--controlling policies that benefit their bottom lines over education, jobs, local economies, clean water, rational security policies, health care, and the human condition. Policies for the few at the expense of the many. 


Same ship, different captain, same direction. 


We're now a plutocracy, with our representatives, legislative processes, White House (regardless of its occupants), and economic system controlled by the plutocrats like Goldman Sachs, Exxon, and especially Citi, which penned the paper "The Plutonomy Symposium Rising Tides Lifting Yachts", in which it argues that it should take advantage of the reality that the rich and superrich will continue getting richer. 


That was 2005. 


Wages? Stagnant since the 80's. Wealth? The top 20% control 80% of the wealth, a significant increase since 1980. 


There's nothing exceptional about getting stuff made overseas on the cheap. Nothing at all. Free Trade is not about you. It's about them. The top 10 or 20%. 


China is a communist country. It continues to murder its people when it feels threatened by them, imprisons democracy activists and religious leaders, exploits its workers, and censors or smothers any voice raised in opposition to its world view. 


America is happy to do business with it. 


Your America. Your government. Which you've handed to the plutocrats who serve the very wealthy extremely well. 


Obama is one of these plutocrats. 


I'm amazed that Fox News and its followers call Obama a socialist. The guy's paved the way for even greater control of US policy and wealth by the rich and powerful--how can you call him anything but a servant of the rich and capitalists? 


When the sky was falling on middle America, what did Bush do? Told us to shop. Be good consumers. Sent us a check to shop a little more (twice!). 


What did Obama do? Coddled Wall Street. Make it safe for international bankers. Shore up Wall Street profits. Make it easier for Communist China to suck even more out of the US economy. 


So back to the beach ball. It will never re-inflate. It's over. They won. 





They control our elections through campaign donations and the ownership of the airways, they control our government through lobbyists (elected lobbyists and their professional counterparts), and they apparently control you and your perception of what the demons really are in the US. 


Like education. 


That's the problem, it's those greedy teachers making $50k a year. Did you ever consider why your school taxes go up, your income stays flat, corporate taxes go down, jobs go overseas, college becomes unaffordable, GDP and the DOW grow to record levels, that somehow, in some way, this is all connected? 


Of course not. 


We're passive idiots, believing the shit they've been selling us for decades, hoping that some day the extra training will magically create a decent job and adequate healthcare, that poverty will be vanquished, that our kids will have reliable, decent opportunities in the future, and that we can get a clean drink of water without worrying about the pharmaceutical content. 


Well you can hope in one hand and piss in the other, and see which one fills up first. 


Me? I'm tired of hope. Hasn't worked.


Action? 


If I believed for a second--and I do not, currently--that the people of this country would gather together and say "enough!", and demand a change to our plutocracy, and take to the streets, and fight for justice, and demand equity in our futures, and demand a realignment of our realities to the rhetoric...well, maybe I'd feel like there's a chance. 


Today, this dark windy day after the hurricane, I don't believe that. I believe those among us who would lead, resist, agitate, fight, and evangelize the restoration of democracy as the overlord of its economic system, as opposed to the reverse, well let's just say I think we've been burned too many times by the likes of Obama, Clinton, Pelos, Reid, Casey, Rendell, Corzine, and Schumer. 


Unless...?
  • Enforce trade agreements. 
  • Slap a "democracy tax" of 25% on any product made in a country that does not have a formal participatory democracy--that's the baseline. China, read this and get to work. 
  • Funnel the revenue from the democracy tax to investing in infrastructure & education.
  • Lower the corporate tax rate to 25%, but close all the loopholes.
  • Invest in entrepreneurs, the true job creators
    • startups--not just tech startups, but startups in general
    • small, established companies that need capital to grow
  • Get corporate money completely out of the political process
    • campaign funds
    • lobbyists (but who will write the laws?)
  • Publicly finance campaigns. We still have a few smart people around--let's figure it out. 
  • Prosecute those who have defrauded the government and homeowners. Vigorously, publicly, and spitefully. Put Spitzer on it. I don't care about his personal smarminess--he's a great prosecutor. 
  • Create specific tax benefits for any company that moves production BACK to the US, and specific penalties for those who keep it overseas. 
This isn't protectionist. I'd say those arguing for greater access to cheap labor are undemocratic, unAmerican, and "protectionist" toward the rich and all that the rich control. 

It's your country. Or used to be. When are you going to claim it?

2 comments:

  1. Are you saying that we are hopelessly screwed?

    ReplyDelete
  2. "If I believed for a second--and I do not, currently--that the people of this country would gather together and say "enough!", and demand a change to our plutocracy, and take to the streets, and fight for justice, and demand equity in our futures, and demand a realignment of our realities to the rhetoric...well, maybe I'd feel like there's a chance. "

    ReplyDelete