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| Apr 01, 2009 4:59 am |
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re: re: re: re: re: re: re: re: US Economy and Stimulus - TIME-LINE |
John Stephen Veitch
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Hello Ron
Well done, that lifts the quality of the discussion.
Ronald Reagan gives a great speech and except for his strong anti Communist stance, I agree with most of what he says. However what the USA did under his administration was almost exactly the opposite, government got bigger and the deficit grew and grew.
It's funny, but the part of his policy I disagreed with, taking a tough line against the USSR, was from the point of view of an outsider clearly wrong, but it created a tension which was later released to good effect when Ronald Reagan had a change of heart and decided the USA and the USSR could be friends after all. (It had always been the case.)
Thanks for the opportunity to listen to Daniel Hannon, who like Reagan makes valid points, but doesn't necessarily win the argument.
There is OPPORTUNITY in this economic crisis to rebuild the economy in a way the opens the future, but there is also an opportunity to rebuild the old economy which will have the effect of re-creating all the problems that have temporarily disappeared in the depression.
It's important that we do the former and not the latter, because if we don't in a few years we'll revisit the present crisis in an even worse form.
For the last 30 years in the USA and around the world we've had the most free market culture ever. That's especially true in New Zealand. Yet here, it's failed to produce the economic growth we were promised. In the USA it's produced false wealth. Real wages have been declining. Only the top 10% have had any real wealth increase and 50% of that went to the top 1%. So don't tell me that "free markets" alone, are the key to success. That's simply not true.
So we need to be lot more intelligent about what we mean by "markets" and what we mean by "free". We need to be much more aware of political, business and personal options. We need to create a democracy of ideas, rather than a free market of ideologies.
Gordon Brown and Barack Obama are forced in the short term to shore up the existing structure. Otherwise the short term cost in jobs lost would bring almost immediately street riots and civil disobedience. I agree the debt that imposes is undesirable, and I also agree that much of the money will go to the wrong people. I'd say make a choice; Take the risk of paying the wrong people or risk having burning buildings. Today, we have to keep the system standing, make the payments.
Then we need to strongly embark on building a new system. I identified four targets, but there may be more. My targets were:
Water use and distribution
Energy use / Transport
Climate Change
Population
We could usefully add serious investment in the 8 Millennium Goals, the achievement of which would both create jobs and change the future of the world.
Doing these things is essential for the future of the sort of society we aspire to live in. None of us want to see our children and grandchildren living in a world where an acceptable lifestyle is impossible because of resource shortages, climate change and global warfare.
If the free market is allowed to go on it's own merry way, we destroy the climate first, and then we find a solution. (In fact we may have already done that.) And we'll wait until oil is so expensive it's uneconomic to use it, and then we'll look for alternatives. (We've done that too.) And we'll go to war over water and mineral rights, telling ourselves that there is "no alternative", because our "survival" depends on it. But in the end we won't survive anyway, because we will have killed the means of our survival.
Time NOW to be much smarter than that. But to do so YOU, and also ME, have to be willing to put aside our outworn ideologies and understand reality. So tone down the political rhetoric and all the ideological statements about free speech and free markets and personal sovereignty, and individual rights. If it's useful, use it. but if it's stopping us from thinking clearly then it's a barrier to our survival, and we need to put it aside.
For the UK, the financial system is a basket case, but with help from Europe Brown might be able to succeed.
IN the USA Obama has a much worse problem. The Democratic Party (and the Republicans) are deeply committed to the existing structure by strong financial support. Obama is committed to rebuild the old system and to retain the people who run the old system in a way that Brown is not constrained.
With the recent strong words to the Auto Industry, and with a plan to support green energy projects, there are hints that he'd like to move into the new economy I speak about, but I doubt if the "system" will let him.
In the end, it will probably comes down to what happens on the street. If the economic wheels start rolling again before unemployment gets too high and the riots start, executive jobs are safe, the old system is restored, and we go on to fight another day. (But without the fundamental change I believe is needed.)
If that doesn't work, pressure on the street will force more drastic changes forcing the more fundamental change I believe is necessary. There is plenty of room here for the Republican Party to rediscover a new future for themselves, but I suspect they can't, and we've already seen the last of them. There's plenty of room also for the Democrats to self destruct. And there must also be opportunity for new political forces to enter the arena.
As I've said before, EVERYTHING is being revalued, not just the price of your assets, and the value of the US Dollar, but also the value of our own belief systems. Stress testing is the order of the day. Everyone's already lost a great deal. Those who re-evaluate well, who come out the other side of this depression with the right ideas and business models and philosophy for a reorganized "new" economy will do well. Those who find they can't change will engage a lot of work and investment but find only repeated failure, and wonder why.
John Stephen Veitch
Open Future Limited - http://www.openfuture.biz/
Innovation Network - http://veech-network.ryze.com/
Building an Open Future - http://openfuture-network.ryze.com/Private Reply to John Stephen Veitch (new win) |
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