Friday, October 14, 2011

Short Voter Guide for Restoring the U.S. Economy

The mid-term future for the U.S., as the result of apparent short-term and secular negative economic trends amplified by political failure from both major parties (splitting conservative elite rule over the U.S.), appears highly unfavorable. Those who benefit have generated much confusion, but some simple steps toward a solution benefiting society can be taken by a concerned voter.

Americans and the American Dream are currently experiencing death by soundbite. It is no wonder we are all confused. The very short video below of a recent Elizabeth Warren campaign talk on how we got in this mess and how to restore America constitutes the best "sound bite" answer I have heard. Listen, then read on.
Elizabeth Warren on Restoring America

Read together, two articles on economics in the October 9 New York Times paint a grim picture. David Leonhardt argues in The Depression: If Only Things Were That Good, [Sunday Review, 5] that secular trends during the Depression were actually much more positive that secular trends in todays increasingly hollowed-out economy. We fail to see the silver lining in the grim Depression because the positive secular technology-development trend in the 30s was hidden from our sight by the horrible short-term wave of highly visible unemployment. The second half of the economic picture is given by Jeff Sommer in An Ugly Forecast Thats Been Right Before, [Sunday Business section, 8] about the Economic Cycle Research Institutes current assessment that the U.S. is entering a second recession. The message of the two articles taken together, then, is that now both short-term (next couple years) and mid-term (next decade or two) economic prospects are bad. (Note that neither speaks to long-term capacity of a society blessed with an abundance of resources and at least minimal education and common purpose.)

If one adds to this dismal economic forecast for the next generation or so the evident continuation of Government failure (whether one attributes that to intentional politician greed or simple incompetence) to address the problems society is facing, a positive outlook is hard to sustain.

What should a voter do? The key to understanding the mess is avoiding being tricked into buying false categories (e.g., big government vs. small government, conservative vs. socialist, good vs. evil). Such simplistic sound-bite categories serve only to confuse. Rather than arguing over the size of government, consider what you want government to do and what you are willing to pay for it (e.g., for schools, roads, defense, protection of the air you breathe, protection from criminals). Rich conservatives love big government when it puts money (e.g., bailouts of Wall St., tax havens for Big Oil) in their pockets. Rather than arguing over good vs. evil, ask how others see their world, ask who benefits, then and search for mutually beneficial outcomes.

More specifically, here are a few straightforward clues to identifying good leaders:

First, demand leadership that concentrates on rebuilding national infrastructure rather than waving the red flag of small government; those who tout small government usually want welfare for the rich and small government for the poor.

Of course an active government needs money. So, second, look for candidates who admit that this money can only come from a combination of taxing the superrich and from our grossly fattened-up military budget. That of course will entail redesigning foreign policy to rely primarily on diplomacy (i.e., working to find win-win solutions) rather than force to maximize one-sided benefits. A good starting place might be to address the monstrous army of expensive private contractors (many outright mercenaries) holding quarter-million-dollar-a-year jobs in Iraq and Afghanistan that either locals or U.S. civil servants should be doing at far less cost and with far greater responsibility than out-of-control private companies whose goal is profit.

Third, government regulation must, once again, replace the legal piracy known as trusting corporate America.  For a start, look for politicians who appoint financial watchdogs from outside the gang of foxes who brought us the recession in the first place, e.g., folks like Elizabeth Warren rather than Tim Geithner. Look also for leaders demanding that those responsible for causing the recession be held personally responsible in court. [On punishing financial criminals, see this small piece of good news.]

Politicians make all this appear far more complicated than it really is, because winning the next election is almost universally more important to them than solving the problems and, all too often, because they intentionally caused the problems for their personal benefit in the first place. A solution is not impossible, but it seems very unlikely to appear by itself: the combination of negative short- and medium-term economic trends makes that point. To turn the U.S. around, you voters will need to get past sound bites and insist that politicians stop giving the abusive elite a free pass to use your tax dollars for their personal benefit.

This essay offers some simple hints about how to start thinking about a solution to the U.S. economic debacle. Those readers who want more detail may wish to take a look at:

Too Big to Exist, which proposes putting fat institutions on a diet;
The Way Forward, a plan for restoring the U.S. economy by Nouriel Roubini et al.;
Mayor Bloomberg and Occupy Wall Street By the Numbers, class warfare data from Juan Cole.

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