Bill Moyers disses Dems as 'spineless'

[xssve]

The US is somewhere in the middle at the moment, but rising, China's dependency ration remains relatively low at the moment.

PV could be a huge export industry, economic conditions have been favoring exports, and energy demand is only going to grow globally - but again, the pubs cut all funding to concentrate on oil colonialism, which thus far, has not shown any significant return on investment, and has mostly succeeded in militarizing, destabilizing, and polarizing the middle East - pretty much the opposite of what would seem desirable in a sensible market approach.

 

[JAMESBJOHNSON]

National health care for everyone will be a big part of bringing manufacturing back to the forefront in America. Labor costs, minus benefits, is a drop in the bucket for most factories. It's paying for the benefits that are driving American companies out of the country. At my last factory job I was paid very well for being a blue collar grunt and our wages without the benefits cost the company around 4% for 3/4 of the year and less in the last quarter. It was the benefits that took it up to 11 and 12%, which in the words of our company president "still isn't that bad". But for some companies with larger payrolls it can be that bad. If Americans can be paid well we can afford to pay a bit more on taxes for healthcare and no one will even really notice. National healthcare will be good for business.

National Healthcare cant be good for business as it adds to the cost of goods and services. No place on Earth has America's high living standards, and the peasant who sleeps in an appliance carton works for less money than the union member who sleeps inside a gated-community. And when wives go to the store they dont give a damn about peasants on bicycles and guys who drive SUVs to work; they care about the price. Price always wins.

The real solution to our problems will piss everyone off because we have to kill all the cartels that control the economy, just like we destroyed Standard Oil and Bell Telephone. When I was born we had maybe 9-12 major automakers in America: Ford, GM, Chrysler, Sudebaker, Packard, Willys, Kaiser, Crosley, Hudson, Checker (made taxis), etc. You could buy a King Midget or a Crosley, a Cadillac or an Imperial. Now we have 3 car companies on life support. Cartels atrophy and expire from lack of competition. Imagine if Danielle Steele, John Grisham, and Tom Clancy was it for publishing....it would be like China back in 1969 when all you could read was Mao.

So we need to kill the cartels and the unions.

 

[voluptuary_manque]

Ami, you are missing part of the economic equation. How does an industrialized nation get out of a ressession? They produce themselves out of it.
And that's the problem. What do we really produce in the country? Cars? Machine Tools? Big price tag industrial equipment? Or are those produced by American Companies in Canada and Mexico or China or South East Asia?

Even if we still have the production capacity in the US and could produce large quanities of product where would we sell them? Isn't every country in Europe having the same problem? Certainly we could sell them for big bucks to Arab countries such as Lybia and Iran, but there are major drawbacks to that.

So...?

What do we produce in this country? Mostly stuff that is so high dollar you don't ever see it. To the tune of 20% of all the world's manufactured goods in dollar value. Look it up, that isn't a blue sky call. And then there's pharmaceuticals, computers, Boeing planes . . .

No, China is a major manufacturing power, there is no doubt of that but they're way behind the U.S., Germany, and Japan.

 

[JackLuis]

Following the Money again.

I was happy to see Boota and xssve's posts, I tend to agree with them. on Bill's comment as to Raham. It is about the money.

Today I found (This),another Question that is related is a small way to health care, but the documentary is well done.

It suggests that the ones who control the world are in many different places. One thing I liked about it is that he talks about it from the Canadian and American sides of the issue. It is over an hour long and best if you see it at one go.

VM we have lost most of our capacity to competitively manufacture and the skills to operate the factories. The Silicon Valley is no longer the Meca of Electronic Construction, IC's and thier decendants, (Microprocessors and Gate Arrays and the like) have made 60-80% of the labor in the valley redundant. The Auto Assembler has laid off most of their workers and a multimillion dollar plant is idled.

But my Daddy always told me, "Son, Follow the Money and you will Find the truth."

 

[voluptuary_manque]

Skills? Manufacturing skills? Today's manufacturing, worldwide, is done by robots. Factory workers in China are being laid off and replaced by CNC machines. The manufacturing skills of today are computer programming and CAD.

 

[Handprints]

Just a couple of random (and badly-organized) points I thought were worth throwing in. If you're reading this in either the US or Europe, probably the right thing to believe is that you're in the middle of the beginning of the debt/bubbles/monetary policy problem: the artillery fire is starting to slack off and we're all more or less dug in to see what happens next.

Property-linked debt (whether you're a mortgage holder, a house-seller, an investor in a bond fund or what have you) is still a gigantic issue and nobody really has a good idea what will happen as the next two waves of ARM resets kick the US homeowner in the nads, as the commercial property market starts to adjust to what look like long-term depressed retail sales, or as the office and industrial markets adjust to companies chasing smaller footprints or just trying to stave off bankruptcy. It's a huge market, it's still brutally ugly and there just isn't likely to be anything like a clear forward view in the next three years.

Banks aren't a done deal either. US and European governments are, for now, allowing banks to take advantage of ultra-low borrowing rates to repair their own balance sheets. The quid pro quo for this was that banks would, in turn, make a lot of this cheap money available to consumers through lending. They didn't. And, to be fair, most consumers don't want any more debt and are paying what they have down (if they can) instead of buying new stuff. If you're a business and you can't borrow, that's tough but often survivable. If you're a business and nobody's buying, that's death. If you're a banker to such businesses... You can work that one out for yourselves.

Despite all of this, new bubbles keep forming (gold, certain kinds of global property, insane prices for high-grade sovereign debt) and old bubbles haven't yet fully corrected (developed market stock prices, US/Western European housing prices, certain kinds of metals.) Time will solve bubbly problems, however painfully, and monetary policy measures are required to solve the rest. But what kinds of policies?

Before I start this bit, a note to the cheerleaders: I don't care which set of economic principles (left or right or other) you think are self-evidently a form of natural law that is the only hope of guiding man to a better future. Don't wanna know. Whatever I say next, it is not a bullet aimed at your precious little hearts. It is the kind of neutral view you will only get from someone who has a "whatever works" attitude to monetary policy and leaves imaginary leaps to philosophy for the (with love in my heart) deluded. For me, monetary policy is a tool box. I don't use a jolly bar when I'm disassembling my iPod: picking the right tool is what counts, not the moral provenance (if any) of the tool itself.

Monetarism is currently providing nothing but deeply unacceptable (because illogical, unlikely to work or unpalatably painful) answers to US/European government problems. This is kind of a problem because, despite its many internal spats and schisms, monetarists are the overwhelming majority of western economists. The whole von Mises/Hayek/Chicago idea set currently produces some mind-bogglingly bad answers to current questions. As an example, there's a handy monetarist guide to finding the "neutral" Fed funds rate - the rate at which the Fed's impact is neither deflationary or inflationary. That guide suggests that the rate should currently be set at minus 6.5 percent and, if reflation is wanted, lower! (In other words, the Fed should charge you 6.5% a year for the privilege of lending to it.) Monetarism suggests nothing is more dangerous than inflation. As a consequence, it provides almost no tools with which to combat deflation, which is what the US has been experiencing for some time.

From the other end of the spectrum (Not as far as you'd think: read Friedman again today and it sounds like some mild tweaking to Keynes. In the current environment, after 30 years of intensifying monetarism, what was once thought revolutionary now reads like a manual for basic economic hygiene.) Keynesian prescriptions are proving harder to carry out than they were in the 1930's: sure, the government can borrow and spend, but spend on what? The US and Western Europe are chock-full of infrastructure. Repairing it will help the economy and create employment but it's not going to have anything like the impact that creating it in the first place did. Also, governments began the Keynesian experiment with (typically) vastly less debt than they carry today. How much can they credibly borrow before lenders cut them off by devaluing their currencies?

As an aside, I keep hearing, particularly on the rare occasions I watch US tv, that "the government should stay out of the markets." If there is one utterly inarguable and clear result of the past two years' economic chaos, it's that monetarism gave markets a thirty-year dose of amphetamines: stock markets, housing markets and commodity markets were all being utterly and unnaturally distorted by monetarist economic policies. Anyone who thinks that thirty years of near-continuous market growth was an expression of what markets can do when left alone needs to have another look at the puppeteer's hand sticking out of the market's arse. (That realization alone - one broadly shared by policymakers and economists from all parts of the spectrum - is one of the main reasons no-one's much listening to the monetarists for advice this time around...)

There's a second issue with Keynesian solutions, hinted at above: to work really well, Keynesian stimulation needs to be amplified by a more widespread increase in bank lending. The banks won't lend, outside of a handful of countries such as China, where Keynesian stimulus efforts have, so far, worked exactly as Keynes intended. This central problem has not been well-addressed anywhere, although I suspect that the countries who went for more aggressive forms of bank nationalization than the US will be better placed to start solving it.

What we really need right now is the new Keynes/Friedman/(insert your economic game-changer here). In her absence (we're well overdue for a woman in that role), we're probably going to keep experimenting with Keynesian variations that are coupled with systemic reforms to lending, insurance and market trading. They might work, they might not. They're extremely unlikely to produce much visible progress in the next three years.

Final comment: the US didn't just lose manufacturing as an industry, it lost manufacturing engineering as a capability. You can build and hire for a new plant tomorrow. They guys who know how to move products through it efficiently are long gone. That one ain't coming back anytime soon in any scale.

Hope that's of use,
H

 

[rgraham666]

Handprints, your posts are always a joy to read.

Myself I think that the ultimate problem is that people forget that, as you said, society is just a box of tools. We get to worshipping a certain tool and try to use it in all circumstances. Which ends up with society 'using a jolly bar to fix an iPod'.

It might be fun but your iPod won't be working afterwards.

 

[JAMESBJOHNSON]

What I'm observing in my community is a significant increase in black market, under the table, outlaw commerce. People need cash, I need to make my money stretch.

America is poised to become a Cuba Style Economy. The elites will do okay, but the middle class will evaporate, and the huge underclass will barter or black market goods and services, just like I buy government assistance goods from women needing the cash.