Le Jacquelope
Loves Spam
- Joined
- Apr 9, 2003
- Posts
- 76,445
Is it time yet to bury the "Economics is not a zero sum game" argument?
Years and decades of plus sum game growth are being rolled back and ground under by this hurricane-force recession.
Actually, this is the second near-knockout blow recession in under 10 years, but this one is especially nasty in one epic... no, legendary... way:
The damage from years and years of offshoring high paying American manufacturing and tech jobs and replacing them with lower paying service jobs, has been masked by consumer spending based on skyrocketing debt.
That debt based spending has led to remarkable economic growth and the construction of the "plus sum game" altar in which the economic pie always grows and that for one person to win, another doesn't have to lose.
That altar has been utterly crushed by the great subprime crisis comet that hit the world in 2007-2008.
The reality, which is no longer a matter of predictions by prophets, but a matter of observation by historians, is that debt based consumer spending is all but over. People are going to have to live more within their means. Credit cards are maxed out and credit is going to be much harder to come by.
No, I don't mean the CURRENT credit crisis, in which businesses cannot get loans. That was just the first part - you know, where the waters recede out beyond the horizon. What I'm talking about is the OTHER credit crisis - the post comet impact tsunami that has already hit land, washing out to sea a huge chunk of consumer spending even as we speak. Washing away god knows how many businesses and jobs at a rate of over 500,000 per month.
When those waters recede, there won't be any more plus sum altars being built. Jobs pay less now than before, all the good jobs are leaving because of "free trade", and capital is mobile, but labor is not. Because there is no such thing as free trade when workers are not as mobile as capital, the economy will now flow in parallel to the TRUTH:
Economics is a zero or negative sum game.
Most will no longer be able to use credit and debts to augment what they earn; and thus most will no longer be able to spend more than they earn.
The economic pie will not just simply grow more slowly.
Welcome to the economic ice age. It's not a matter of wild pessimistic prediction; it's now a matter of current events.
Dress accordingly, or be a consequence of it.
Years and decades of plus sum game growth are being rolled back and ground under by this hurricane-force recession.
Actually, this is the second near-knockout blow recession in under 10 years, but this one is especially nasty in one epic... no, legendary... way:
The damage from years and years of offshoring high paying American manufacturing and tech jobs and replacing them with lower paying service jobs, has been masked by consumer spending based on skyrocketing debt.
That debt based spending has led to remarkable economic growth and the construction of the "plus sum game" altar in which the economic pie always grows and that for one person to win, another doesn't have to lose.
That altar has been utterly crushed by the great subprime crisis comet that hit the world in 2007-2008.
The reality, which is no longer a matter of predictions by prophets, but a matter of observation by historians, is that debt based consumer spending is all but over. People are going to have to live more within their means. Credit cards are maxed out and credit is going to be much harder to come by.
No, I don't mean the CURRENT credit crisis, in which businesses cannot get loans. That was just the first part - you know, where the waters recede out beyond the horizon. What I'm talking about is the OTHER credit crisis - the post comet impact tsunami that has already hit land, washing out to sea a huge chunk of consumer spending even as we speak. Washing away god knows how many businesses and jobs at a rate of over 500,000 per month.
When those waters recede, there won't be any more plus sum altars being built. Jobs pay less now than before, all the good jobs are leaving because of "free trade", and capital is mobile, but labor is not. Because there is no such thing as free trade when workers are not as mobile as capital, the economy will now flow in parallel to the TRUTH:
Economics is a zero or negative sum game.
Most will no longer be able to use credit and debts to augment what they earn; and thus most will no longer be able to spend more than they earn.
The economic pie will not just simply grow more slowly.
Welcome to the economic ice age. It's not a matter of wild pessimistic prediction; it's now a matter of current events.
Dress accordingly, or be a consequence of it.
