Around the World in 80 Basis Points
And now for news of fresh Blue State disaster, both home and abroad.
But first, some background. Back in 2010, Theodore Dalrymple explored the revival of centralized economic planning in general, and the fortunes of its most prominent 20th proponent, John Kenneth Galbraith, specifically:
His books sold by the million and were available everywhere in cheap paperback editions; titles such as American Capitalism and The Affluent Society were known to almost all educated people. A teacher at Princeton, Cambridge, and Harvard, he was the editor for a time of Fortuneand the American ambassador to India. He was also the first economist to be widely known on television, not least through his sparring with William F. Buckley, Jr. (a close personal friend). His omnipresence as the voice of economics was both the result and the cause of a whole climate of opinion.
As is commonly the way, a reaction set in. Galbraith, who lived from 1908 to 2006, grew not only old, but old hat. His Keynesianism appeared outmoded in an era of unprecedented growth and prosperity apparently brought about by adherence to economic theories very different from his. No one believed any longer that demand management—the governmental regulation and, if necessary, provision of the demand for goods and services within the whole economy—was the way to combine prosperity with social justice. Rather, the market’s invisible hand and unconscious wisdom would lead us into the sunny uplands of expanding wealth and diminishing poverty.
But recently, there has been a reaction to the reaction. No sooner had Lehman Brothers collapsed than the printing presses started to roll out copies of Galbraith’s book on the debacle of 1929, The Great Crash. In fact, it couldn’t be printed fast enough, paperback books being affordable even in times of crisis. Galbraith was the hero of a recent PBS documentary extolling the value of big government. And demand management à la Galbraith is now back with a vengeance, of course. If the improvidently indebted but now impecunious private citizen won’t spend and thereby expand economic activity, the improvidently indebted but infinitely expandable government will do it for him.
So how’s that working out? Pretty badly, if these recent stories are any indication. First up, at Big Peace, founded by the late Andrew Breitbart, John J. Xenakis has this news of fresh disaster from Europe: “Spain Unemployment Near 25%; Britain Enters Double-Dip Recession”:
- Spain’s economy keeps spiraling downward as unemployment rises to 25%
- Switzerland considers paying illegal aliens to leave Switzerland
- Britain’s economy moves into a ‘double-dip’ recession
- Germany’s Angela Merkel angrily repudiates François Hollande’s campaign promises
- Greece’s elections driven by anti-austerity, anti-immigrant fervor
- Romania’s government collapses, Czech government survives, in anti-austerity anger
While President Reagan was working to expand entrepreneurship in the US in the 1980s, statist-oriented economists trumpeted the top-down economy of Japan as the better model — recall ’80s and early ’90s era-films such as Gung Ho, Black Rain, and Rising Sun. Two decades later, Ross Douthat describes Japan as the “Incredible Shrinking Country,” facing demographic, and presumably economic, collapse as well, in the New York Times, and living out a real-life version of The Children of Men, PD James’ 1992 novel:
Japan is facing such swift demographic collapse, Eberstadt’s essay suggests, because its culture combines liberalism and traditionalism in particularly disastrous ways. On the one hand, the old sexual culture, oriented around arranged marriage and family obligation, has largely collapsed. Japan is one of the world’s least religious nations, the marriage rate has plunged and the divorce rate is higher than in Northern Europe.
Yet the traditional stigma around out-of-wedlock childbearing endures, which means that unmarried Japanese are more likely to embrace “voluntary childlessness” than the unwed parenting that’s becoming an American norm. And the traditional Japanese suspicion of immigration (another possible source for demographic vitality) has endured into the 21st century as well. Eberstadt notes that “in 2009 Japan naturalized barely a third as many new citizens as Switzerland, a country with a population only 6 percent the size of Japan’s and a reputation of its own for standoffishness.”
These trends are forging a society that sometimes evokes the infertile Britain in James’s dystopia. Japan has one of the highest suicide rates in the developed world, and there were rashes of Internet-enabled group suicides in the last decade. Rental “relatives” are available for sparsely attended wedding parties; so-called “babyloids” — furry dolls that mimic infant sounds — are being developed for lonely seniors; and Japanese researchers are at the forefront of efforts to build robots that resemble human babies. The younger generation includes millions of so-called “parasite singles” who still live with (and off) their parents, and perhaps hundreds of thousands of the “hikikomori”—“young adults,” Eberstadt writes, “who shut themselves off almost entirely by retreating into a friendless life of video games, the Internet and manga (comics) in their parents’ home.”
And speaking of Japan and Europe, “Europe faces Japan syndrome as credit demand implodes,” Ambrose Evans-Pritchard writes in the London Telegraph:
This slump in loan demand is more or less what happened during Japan’s Lost Decade as Mr and Mrs Watanabe shunned debt. Zero interest rates did nothing. The Bank of Japan was “pushing on a string” (though it never really launched bond purchases with any serious determination).
It is true that banks have slowed the pace of credit tightening, but they are nevertheless still tightening. “A banking crisis remains very much in play for much of the region,” said David Owen from Jefferies Fixed Income.
The credit squeeze is entirely predictable – and was widely predicted – given that banks must raise their core Tier 1 capital ratios to 9pc by July to meet EU rules, or face nationalisation. (The pro-cyclical folly of this beggars belief: by all means impose higher buffers, but not during a recession, and not by letting banks slash their balance sheets. The US at least forced its banks to raise capital, an entirely different policy since it does not lead to a lending crunch.)
The IMF said last week that Europe’s banks would slash their balance sheets by €2 trillion – or 7pc – by next year. This amounts to an economic shock. The Fund said deleveraging on this scale at a time of sharp fiscal tightening risks a “bad equilibrium”.
Indeed it does. It ensures hell for countries containing 200m people, or more. Judging by the rise of Sinn Fein, the Dutch Freedom Party, the Dutch Socialist Party (hard-Left), France’s Front National, and some true fire-breathers in Greece, they victims will not readily put up with this.
Oh well, what’s another potential “European Civil War” amongst friends and neighbors? Over on this side of the Atlantic, America’s Bluest of Blue regions are undergoing similar demographic and economic convulsions, as we’ll explore right after the page break.
It’s behind their subscriber firewall at the moment, but the latest issue of National Review has a devastating article on Detroit’s woes by Kevin Williamson, titled, “Let Detroit Fail.” And this is one Epic Fail, as the kids say on the Interwebs these days:
At some point, Governor Snyder and the people of Michigan will have to deal with reality: Detroit’s political leadership is a parasite that has outgrown its host. People are leaving Detroit as quickly as they can: Well more than 200,000 have left the city since 2000, and more than 1.5 million since 1960. Which is to say, Detroit’s refugees since 2000 could form a city bigger than Providence, Salt Lake City, or Des Moines. Those who have fled since the city’s peak could form a municipality bigger than any U.S. city except New York, Los Angeles, Chicago, Houston, or Philadelphia. But government spending in absolute terms long continued to rise; in per capita terms, it rises still, and the city spends far more per capita than the U.S. average. Detroit’s public sector has responded to every fiscal crisis by raising tax rates and by instituting new taxes, as often as not enabled by Republicans in Lansing. But new taxes and higher rates cannot offset the effects of the city’s rapid and steady depopulation — in fact, surveys suggest that they have hastened it — with the result that revenues declined by more than $100 million between 2007 and 2011. Income-tax revenue dropped by 18 percent, utility-tax revenue by 17 percent, property-tax revenue by 2.3 percent. Seeking a quick fix to its revenue problems, Detroit chartered several casino-gambling operations, only to see taxes from them begin to decline (by 1.5 percent last year) after a period of early growth. Detroit, once the wealthiest city in the United States by per capita income, is today the second-poorest major U.S. city.
Like many cities, Detroit has promised very generous pensions to its public-sector workers but set aside very little money to fund them, meaning that in 2011 the city had to put more than $70 million into the pension fund to keep making payments. Government is Detroit’s largest single employer, and spending on government remains very high. What Detroit is getting for all that spending is unclear: It has some of the worst schools, roads, sidewalks, and local services of any city in the country. [QED -- Ed] Last year, its murder rate was up 10 percent. Very few people with options are going to stick around to endure both the highest tax rate in the state and one of the highest murder rates in the country — let alone highly skilled, highly productive workers, investors, and entrepreneurs. Detroit is driving away the people it needs to survive. Who is left?
Who is left, Williamson goes on to write, are those who have caused the city’s collapse, its Ruling Government Class. In the state of California, a similar trend is occurring.
In the 1990s and 2000s, Sacramento looked upon the EU as a role model. In 2003, Californians ousted the hapless Gray Davis and replaced him with the soon to be equally hapless Arnold Schwarzenegger in order to change that model. In retrospect, Arnold cowering like a girly-man in the midst of threats from teachers unions and SEIU did little to change the perception in Sacramento that the voters worked for the government, rather than the other way around. And by the beginning of 2009, Shannon Love of the libertarian Chicago Boyz econo-blog wrote that in a sense, they did:
I think a threshold or tipping point exists in the ratio between the political power of those who pay taxes and those who consume taxes directly. After that tipping point is reached, those who pay taxes become the economic slaves of those who consume taxes.
I think California has passed that point. [h/t Instapundit] Tax consumers now control the state government and can vote themselves almost any level of personal income and benefits they wish while taxpayers cannot muster the political capital to defend themselves.
As Steven Greenhut writes in the Orange County Register this weekend, that’s yet another unsustainable top-down economic model. Or as Greenhut puts it, “California to middle class: drop dead,” with a similar demographic and economic train wreck brewing as in Europe and Japan:
The new USC study pointing to a much-slower rate of population growth in California has been greeted by demographers and urban planners as good news, in that it supposedly gives our state’s leaders a little breathing room to better plan for the future. The rate of growth has slowed to about 1 percent a year, the result of fewer immigrants coming here and many Californians heading to other states. “The cooling pace means the state, city and county governments and other entities will have more time to prepare for a bigger population than they did in years past, allowing for more effective planning,” according to the Los Angeles Times, paraphrasing the study’s authors. “That could ensure that new roads and parks, for example, are put in areas where they are most needed and where growth is likely to be sustained,” they said.
That’s an absurdly optimistic spin. California’s elected officials have been doing as little planning as possible, unless one counts planning to spend tens of billions of dollars the state doesn’t have on a high-speed rail line that will partially replicate what the airlines already do. Our leaders are battling new water-storage facilities and punishing farmers with absurd water-use restrictions. They impose roadblocks to building new highway systems, and land-use regulations make it nearly impossible to build the homes and businesses necessary to meet the needs of a growing population. You can hardly call that planning.
The state is still growing, but this decline in the rate of growth is a symbolic turning point: The California Dream is over. People don’t want to come here even though this is, with little question, the most beautiful state in the union. Americans – even those who like to mock our state – ought to think about what this means for our nation.
And that’s the topic Joel Kotkin explores this weekend at the Daily Beast, writing that “As California Collapses, Obama Follows Its Lead:”
Obama’s push to nationalize many of California’s economy-stifling green policies has been slowed down, first by the Republican resurgence in 2010 and then by his reelection considerations. But California’s politicians, living in what’s become essentially a one-party state, have doubled down on green orthodoxy. As the president at least tries to cover his flank by claiming to support an “all-in” energy policy, California has simply refused to exploit much of its massive oil and gas resources.
Does this matter? Well, Texas has created 200,000 oil and gas jobs over the past decade; California has barely added 20,000. The state’s remaining energy producers have been slowing down as the regulatory environment becomes ever more hostile even as producers elsewhere, including in rustbelt states like Ohio and Pennsylvania, ramp up. The oil and gas jobs the Golden State political class shuns pay around $100,000 a year on average.
Instead, California has forged ahead with ever-more extreme renewable energy mandates that have resulted in energy costs roughly 50 percent above the national average and expected to rise substantially from there. This tends to drive out manufacturing and other largely blue-collar energy users.
Finally, how are things doing in Obama’s adopted home state? “Illinois is running out of time and money,” George Will writes in the Washington Post:
To prepare for Illinois’ probable plunge into insolvency, read “Freedom to Fail: The Keystone of American Federalism” by Paul E. Peterson and Daniel Nadler in the University of Chicago Law Review. They note that only 25 of the world’s 193 nations have federal systems, and in most of the 25 the freedom of the lower tiers of government is more circumscribed by the central government than American state governments are by the federal government. American states’ greater freedom — autonomy under America’s system of dual sovereignty — from the central government’s supervision requires that they be disciplined instead by the market for government bonds, and by the real possibility of default.
Peterson, a professor of government at Harvard, and Nadler, a doctoral candidate also at Harvard, say that collective bargaining rights for government employees pose “a dramatically new challenge to the viability” of American federalism. They cite studies demonstrating that investors’ perceptions of risk of default are correlated with the rate of unionization among government employees. Higher percentages of government employees who are unionized, and larger Democratic shares of state legislative seats, correlate with increases in state borrowing costs.
At least 12 percent of Americans change their residences each year, often moving to more hospitable economic environments. In a system of competitive federalism, Peterson and Nadler write, “If states and localities attempt in a serious way to tax the rich and give to the poor, the rich will depart while the poor will be attracted.” And government revenues and expenditures vary inversely.
Mr. Obama may well win reelection in November, but as all of the above articles highlight, his vision of a sclerotic Galbraithian economic model is ultimately unsustainable, and his profligate spending of the American taxpayers’ money has only made things worse:
Van Jones, Obama’s disgraced former “Green” “Czar,” unwittingly provided the perfect metaphor in 2010 for the president and his fin de siècle “progressive” worldview:
“I can’t stand it,” [Van Jones, speaking at Comic-Con Netroots Nation convention Friday] said of criticism of Obama from the Left. “President Obama volunteered to be the captain of the Titanic after it hit the iceberg.”
And proceeded to ensure that the ship would sink as fast as possible, with as few survivors as possible. While the handwriting is on the wall — even Palace Guard comedian Jimmy Kimmel quipped yesterday at the White House Correspondents Dinner that “‘There’s a term for guys like President Obama,’ Kimmel said with a pause. ‘Probably not two terms.’” — perhaps it would be fitting for America’s most profligate spender to be at the controls while the Blue State ship sinks to the depths of history.
Hopefully permanently this time around.
Update: “England: It was Fun While It Lasted,” Kyle Smith writes today on the PJM homepage.
I will poke you for your slur against Mr. Schwarzenegger. He said at the start he needed his ballot initiatives passed or he wouldn’t be able to do anything, given the Californian Legislature at the time. They didn’t, and he couldn’t….
Seconded. Very interesting interview with Ahnold a couple of months back; he was pretty relaxed about the whole experience and just made sure he enjoyed himself. Paradoxically perhaps, it made me think much more highly of him: The antithesis of the career politician.
I was in touch with some of CA’s labor relations people back then, since I was one of the very few Republicans doing LR in a full collective bargaining state and at the time the only one with any experience in concessionary bargaining. They were pretty sanguine about what they faced with the unions’ dues stream intact and without the AG or the Legislature but they thought that the Governor was popular enough and had been elected with enough of a mandate that they at least had a chance of defeating the unions. I told them they didn’t have a hope in Hell unless they could find a way to cut off the unions’ dues stream. Our experience has been that a threat to their dues is the only way to bring a union to heel. Anyway, there was political fear of “union-busting” charges and “nationalizing” the initiatives, so they didn’t go after the dues. Of course, they got accused of union busting and the election got nationalized anyway. In any event, the failure to bring the unions to heel doomed Swartzenegger and he just rode it on out from there. I thought it was the bravest thing I’d seen a modern poltician do on the domestic front; braver even than Reagan’s firing of the air traffic controllers because the controllers’ strike was clearly illegal. Swartzenegger went toe to toe with arguably the most powerful group of unions in the Country and there was nothing cowardly about what they did, naive in some ways, but certainly not cowardly, and frankly, anybody in government who doesn’t have something somewhere between a healthy caution and outright fear towards large, powerful unions has never duked it out with them.
Yes. And his insistence on holding a special election to pass them was perhaps his biggest mistake followed closely by his decision to abandon the reform fight altogether.
I agree with you that Arnold tried to do what he could, but was not backed up by the voters. There are just too many leftist voters in CA now. They voted for the mess CA has become, and will pay the price. It became obvious to me that Ca had become hopeless when they again elected gov moonbeam. What had been one of the most vibrant and inventive states in the country will soon become a wasteland straignt out of Atlass Shrugged. They will have no middle class, no small businesses, no manufacturing, no mining/oil, a large welfare class totally dependent on gov, a class of unionized gov workers that slowly shrinks as oversized pensions suck up funds for new employees, and a few rich folks in silicon valley and hollywood that can still afford the huge taxes.
Hmmmm, gradually then suddenly… And the complication is the “gradually” phase can last for so long, folks begin to think the “suddenly” phase will NEVER arrive because, after all, we been doing things this way for SOOOOO long and nothing bad ever happened. Then, surprise… the “suddenly” phase shows up, quite unexpectedly and, of course, suddenly.
I hate to say it, but I think a lot of Japan is our fault – insisting they completely de-militarize (which is not something we demanded of Germany). Essentially we emasculated the country, which had had a long term effect on its culture.
The question, as Kathy Shaidle puts it: “Japan: Nuked too much, or not enough?”
The demilitarization of Japan after WWII was at their request – they wanted it included in their new constitution. They never wanted to face the horrors of an atomic weapon again. In fact, the US in 1950 had to insist that the Japanese re-arm themselves in the face of rising communism in China.
And if anything, Germany is worse
I respectfully disagree w/you. We also “emasculated” Germany, leveled many of their cities, & even divided the country, yet they’re not as neurotic as Japan. When a country starts & then loses a war they must face the consequences. Japan got off lightly compared to many other conquered peoples throughout history. At least the Japanese culture wasn’t eliminated compared to those who fought & lost against such peoples as the Romans or Aztecs. The American army was very compassionate to Japan, the enemy at the time, something almost unheard of in military history.
Japan did not “completely de-militarize”. Japan Defense Forces number about 250,000 in all, while Germany’s military has only about 150,000 members. As a result of losing in WWII, both countries have been limited to defensive postures, and do not project military power.
Red states have small governments, low taxes, enforce laws against illegal imigration, allow citizens to arm and defend themselves, balance their budgets, develop their energy resources, don’t demand workers join labor unions…..and people are moving there. Blue states continue to raise taxes, support labor unions, punish energy production, create sanctuary cities, institute strict gun control laws, experience ever increasing violent crime rates, continue to expand their government payrolls and operate in the red….and working people continue to leave those areas. It sounds to me like the free market is working here alive and well. Producers are flocking to free states while the parasites are content in their socialists utopias, as long as someone else pays the bills. It’s sort of a slow moving demographic civil war that becomes more and more obvious as people catch on to what is happening.
That explains it then Rick. As soon as the Liberals start getting things just the way they like it all the Conservatives move out leaving them with no money to fund all their great ideas. See, it’s all the Conservative’s fault. If they just stayed put and gave up all their money everything would be fine! /sarc
It’s also worth noting that in Texas, the current major oilfield developments south of San Antonio and in the Permian Basin of West Texas are almost all in majority Hispanic counties with historically low-income workers. Which means that the evil oil and drilling related companies and their evil fracking process and not only adding thousands of jobs for minority workers, they’re adding jobs that range from $40,000-$75,000 on average.
So the private sector in Texas is taking care of solving part of that state’s poverty problem, while in California (where similar shale plays are possible in the high-unemployment Central Valley region) it’s the liberal ‘haves’ both in the political culture and those within the environmentalist movement, that are working to keep its population perpetually dependent on the state.
Knowledge is incremental. Drip, drip, the drops fall into the cup. Until, one day, the cup overflows. Such is the progress of knowledge. Today, what once suspicion has become a reality.
It has always been grandmother’s wisdom that in times of economic hardship, her grandchildren should husband their resources, until more clement times return. Today, we know as a certainty, if husbands and wives won’t spend, the government will ensure their children and grandchildren will. It’s called Progressivism. You pay, one way or another. There’s no escape.
I guarantee that failing blue states will figure out a wait to suck money out of successful red states.
It’ll be a repeat of the “too big to fail” scenario, with the federal government nationalizing blue state debt. Ultimately, federalism will come to look like socialism: the equal distribution of misery.
Mr. Driscoll’s essay today is both sad and scary, but mostly sad since all of these examples of economic ignorance are of WILLFUL ignorance. Liberals stare economic truth in the face and simply deny it (as they do all truth), preferring the objective wisdom of their righteous “feelings” to the patently subjective, faith-based, empirical nonsense of actual data.
So very, very sad.
As for the scary, Another Slow News Day calls it the Calamity to Come…
http://anotherslownewsday.wordpress.com/calamity-to-come/
… and offers several subjective, faith-based, empirical, data-driven anecdotes proving absolutely nothing to conservative readers who are foolish enough to study them (as per above, liberals will ignore all of them).
You know, you read articles like this one and you have to wonder if this country could actually survive four more years of Obama. Think about it. It took well over 200 years of American strength, imagination, hard work, and ingenuity to build this country into a world power, yet it could really only take eight years to destroy it. Now THAT is scary.
But what troubles me most are the polls. I saw a poll the other day that said that Romney was actually tied with Obama at 46%. I’m wondering how they got 46% of ANYBODY to approve of Obama, considering what terrible shape the country is in. But let’s say for the sake of argument that the poll is correct. Let’s say that there really is 46% of the country that not only thinks Obama is doing a great job, but that they would be willing to give Obama a second term, even if he was going to turn what’s left of this country into Greece. That means that almost half of this country is either feeding off of some form of federal, state, or local government, or that they are union workers or poor people who don’t mind getting handouts from the federal government. So almost half of this nation in some way, shape, or form have no problems with the United States turning into Greece, a failed European socialist welfare state. And even though these same Americans can actually see what a disaster ending up like Greece can be, they don’t really seem to care, so long as some government agency supports them.
I don’t know about you, folks, but I find that REALLY troubling. If Obama really does get re-elected, we will have reached that “tipping point,” where Americans are really more interested in what the government can do for them rather than what they can do for themselves. And the independent spirit that built this country will be gone and we will have the progressives to thank for it. These are dangerous times we live in, my friends, and our last chance to break away from this socialist death-spiral will be in November. And if you don’t believe any of the things I just said, just take a look at socialist Spain, with almost 25% unemployment, high taxes, and an unsustainable national debt. Is that what we really want our future to be like? I certainly hope not.
Spain at 25% unemployment….
…If the truth would be known, the rate of unemployment here is probably pushing 20%…If you factor out all of the lies that we are told….And the so called booming stock market…I think that a lot of Reserve dollars have been propping up that Institute…The Monitary Instituations are being aided with paper that the Feds make up to hide the real economy….Friends, if Obama gets in for another 4 years, all this Paper Built Houses by bogus money, will come crashing down…I just pray that the lies and deceit of this adm. will be exposed for the world to see….Thank You….JBK
They talk about you like a dog…and in a dog eat dog world, …you are either chewing, or being consumed.
The Small C Communists are like the dogs that chased the bus, they caught it…and threw everybody else under it.
There are only two ways out of this disaster movie, let the totalitarians seize control or resist with everything we’ve got.
They control the Inversion Narrative, the Propaganda and Lies Ministry (media, Hollywood and academia divisions), the DOJ, the State Department, the Treasury, Energy, Healthcare, the Auto Industry, banking and finance, insurance, the NLRB, the EPA…all weapons against the free market.
WE control,…the resistance. We are giving away America’s bounty. We should cherish it and all that we have been handed down by our grandparents and parents.
Bounty…the dog hunter.
. . . and in a dog eat dog world, …you are either chewing, or being consumed.
“It’s a dog-eat-dog world, and I’m wearing Milk-Bone underwear!” — Norm Peterson
And what better metaphor for modern America than Norm — a fat professional slacker who sits on his duff all day while running up a bar tab he couldn’t repay in 10 lifetimes.
The “Tipping Point” has been known for centuries, at least as far back as the Ancient Greeks. Even they realized that their Democracies could only last until enough people realized they could vote themselves all they wanted from the treasury, and the politicians let them, of course.
Athens, for example, was at one time an Imperial power with colonies as far away as Sicily and great wealth. Then it started handing out free stuff. That one thing became another and then another. Two generations later, state revenue was less the a quarter of its height, the navy was gone and the army was in shambles. But oh the people were happy with their free food and theater tickets. They even refused to give it all up even as that upstart Phillip of Macedon was luring away or conquering Athens’s ally states. Suddenly there he was at the city gates, but by then it was too late for Athens. I wonder how the people the reacted to losing not only their freebies but there state and freedoms?
The cycle has repeated over and over again in Republics, Democracies and tyrannies. Will people ever learn? Looking at current events: probably not.
Yes, he volunteered to be captain of the Titanic. However, we did not expect him to drill holes in the bottom of the hull to let the water out.
An excellent column with much good information. I live in Colorado Springs, arguably the most conservative major city in the U.S. We have reasonable tax rates, our government is fairly lean, and we regularly make “best of” lists. We have a taxpayer bill of rights (TABOR) that limits government growth (to inflation plus population growth), requires proposed tax increases be put to ballot initiatives, and mandates that surplus funds at the end of the fiscal year be returned to taxpayers. Liberals shrieked that it would be the end of times (it hasn’t been) and have regularly tried to chip away at TABOR over the years.
Comments on the local newspaper editorial page blogs during this Second Great Recession (Carter’s was the first) have been interesting. Our local economy stagnated and unemployment increased like everywhere else, but our socialist (aka progressive) citizens blamed it on our greedy tightwad taxpayers. Local government had to cut spending, such as closing public swimming pools, deferring road maintenance, not watering grass in the parks, not mowing medians, cutting back on police (but with no increase in crime), and turning off street lights. You might have heard about the last item, as the leftstream media made a point of criticizing us for it. If you listened to local socialists, the apocalypse was upon us. The ultimate outcome – we remain solvent.
That is the socialist mentality we are dealing with. I repeatedly reminded fellow bloggers that all municipalities across the nation were suffering because there was a recession – that didn’t stop them from blaming our local government and tightwad taxpayers. I pointed out other non-TABOR, Democrat-dominated governments (e.g., Detroit, California) that were doing worse, and this was met with silence. Finally, I asked repeatedly if anyone could provide evidence that bigger local government and higher local taxes produced better services to the citizens. I never received a single response. Not one. But whenever a new editorial on the economy came along, there they were again with the same whines.
You know what I remember most about Galbraith? He giddy as a schoolgirl the night Jimmy Carter was elected, euphoric that finally, finally, his economic theories would be put into practice.
After the election, California Democrats may well hold enough seats in the legislature to pass new tax bills all by themselves (two-thirds super majority required). At that point our race to the bottom will accelerate.
Europe is tired of life; it wants to die. Europeans have merely progressed from actively murdering one another, to the discovery of passive self-extinction through sociaist economics and refusal to breed .The outcome is the same: death and collapse.God riddance!
This was never a Titanic until Obama got elected. Maybe the ship was listing and taking on water in the storm, but the iceberg hit didn’t occur until the Communist takeover of our government when Obama got elected. We are now getting the results from that debacle. Comrade Obama doesn’t know any better because he was never taught anything better. Electing him again will be the premature end of the worlds greatest experiment in self government, the United States of America. ABO2012
If gigantic bloated government that printed and spent to infinity and beyond WAS the key to economic success then Argentina, Zimbabwe and most African nations would be economic superpowers.
And Obama would be hailed as one of the great presidents, eclipsing even Reagan.
They are NOT – printing and spending to infinity seems to end in hyperinflationary collapse and destitution.
It’s just like Communism and Socialism, great sounding ideas that simply DONT WORK in the real world.
Keynesian spending DOES work, for a short burst. When it is military spending. Planes, ships, tanks and such require massive amounts of domestic labor, and domestic steel, aluminum, etc. That provides a massive jump-start in industrial and labor demand. Nothing else does, not infrastructure, not education/welfare. JUST military spending. See the US Depression, WWII, Reagan’s military build-up. This is well known.
Much if not most of the American public does not like this so refuses to believe it. Because war and the military are mean and nasty things (and empower “awful” guys with pocket protectors who are nerdy, and ordinary grunts and marines and sailors, and Spec-Ops high-speed/low-drag types). Far better fabulous celebrities, vacuous media personality, nothing-work diversity activists, or human resources people, and the like hold the balance of social power. [To a degree, fears of a build-up to a "nuclear WWI" also played a Cold War part.]
However, a military build up if done right is the only way to jump-start an economy. Bonus — you get a big military to intimidate bad actors into marginally better behavior.
As for Detroit, that’s a function of its population. Portland, Seattle, Pittsburgh, as well as Stockholm, Helsinki, Geneva, and Zurich do just fine with a Blue Model. They can afford it. What the heck does Greece, Spain, Portugal, Ireland, Italy, and for that matter France make that can not be easily found cheaper elsewhere? Ducati, Ferrari, Guiness, and Armani maybe? That’s not a basis for an economy. Which requires people to be sober, staid, “boring” every-day workers valuing skills and education. Not say, shooting up a home killing a nine month old baby boy because of an argument over seating at a Baby Shower. This actually happened in Detroit.
If you make a lot of money, and don’t spend it too much on the Blue Model, it is quite affordable. Geneva and Zurich are nice places to live, just ask your favorite I-banker. But that requires a population that can generate wealth and not consume it.
Our dear “whiskey” throws up his “Blue Model” sign, . . . a kind of mere aside: Nearer to reality, when arsonists light large sections of “Portland, Seattle, Pittsburgh, as well as Stockholm, Helsinki, Geneva, and Zurich” afire, sooner or later, the actuarial tables will appear and proscribe insurance for investor finance of business plans in those cities—there will be no large-scale capital investment, it’s just that simple, . . . no jobs, . . . but only poverty, . . . and eventually, maybe some cannibalism, . . . unless maybe, . . . the Chinese send in a small percentage of their troops, . . . to eliminate trouble-causers, . . . just a thought, . . . it appears as increasingly possible, . . .
So if common sense prevails in November and we oust the White-African American President, I believe it is high time for some serious changes to who is allowed to vote in this country. Here are a couple of ideas for all of you to chew on.
1. If you are a net recipient of government money through cash transfers and/or through programs, your vote is not allowed. Only those of us who are net debtors to the government should have a vote that counts.
2. Every major election cycle should test the voters general knowledge of US civics, in particular, the constitution. There should be 10 questions preceding your votes, if you fail to get 7 or more out of 10 right, your vote doesn’t count. Only those who have invested the time to truly understand how our system of government was designed to work should have a voice.
3. If you served in the military for 4 or more years in a theater of war OR 10 or more years during peace time, your vote counts twice, provided you passed the two criteria above.
Now for congress
1. No Congressman’s vote should count on any bill if they first can’t pass a test as to the contents and impact of the bill.
a. A panel of 3 Republican and 3 democrat and 3 of any other party that has at least 5% representation along with a randomly selected group of an equal number of ordinary citizens will be charged with formulating the questions.
b. There will be no fewer than 5 questions per piece of legislation and as many as 500 questions. The number of questions above the minimum will be determined by adding 1 question for every two pages that the proposed legislation contains. (Obummer Care would be 500 questions and never would have passed!)
c. Prior to recording a Congressman’s vote, they must pass this test with and appallingly low 80% score. These scores will be a matter of public record. (Can’t you just hear the likes of Patty Murray, Maxine Waters and Chucky Schummer whining their butts off already! There’s no way these dunces would ever pass these tests!)
These proposals would likely require constitutional amendments to become law, but you can bet your bottom dollar that properly enforced, nearly all of our problems would disappear.
Galbraith, what a friggin’ joke. Read THE NEW INDUSTRIAL STATE and see how he asserts that GM was so big and powerful that it NEVER could fail. It had such market influence it was 100% invulnerable, forever.
Most over-rated man of the 20th Century, after Obama.
The fact that an elegant charlatan’s obviously nonsensical doctrines have been allowed to destroy the West’s economies, speaks volumes about the moral and mental corruption of its ruling elites.The West is a joke!
Mr Driscoll links to the demographic collapse of Japan and the economic collapse of Europe, but then fails to draw the logical solution.
Ambrose Evans-Pritchard reported that “The long-feared credit crunch has mutated instead into a collapse in DEMAND for loans. Households and firms are comatose, or scared stiff, in a string of countries.”
We already know that most European countries are also facing a baby bust, and their populations are getting older. But who are the risk-takers in a society, the old or the young? It is young people who come up with new ideas, who start small businesses and grow them into big companies. Honda, Yamaha, Sony, Fujitsu, etc., were all started by young men hungry to succeed. Those people no longer exist in Japan or in most of Europe. (If Obama has his way, young entrepreneurs will become extinct in America, too.)