Ed, At 08:57 21/12/2010 -0500, you wrote:
Response in this colour, Keith.Ed----- Original Message ----- From: <mailto:[email protected]>Keith HudsonTo: <mailto:[email protected]>RE-DESIGNING WORK,INCOME DISTRIBUTION, EDUCATION ; <mailto:[email protected]>Ed WeickSent: Tuesday, December 21, 2010 2:26 AMSubject: Re: [Futurework] FW: [TriumphOfContent] When Zombies Win (Paul Krugman - The NY Times)Ed,Yes, I can understand Krugman's concern about the poor and the big divide that has been opening up. But this doesn't necessarily lead to clarity and objectivity. The fact of the matter is that America is nowhere near the democratically-flexible country that Krugman (and Obama) imagine it to be. America is now fast joining the elitish world that England, Germany, France are already in where particular streams of well-connected young people (from particular schools and universities) join the world of government (both on the civil service side and politics), big business and banking. As they get older, more experienced and, in some cases highly influential, the more adroit of them move rather freely between these different power blocs as necessity arises. Well, yes, it's an argument Chris Hedges makes in one of his recent books. But in the US, the leadership elite still has to be very careful about keeping the mob in check, as the Tea Partiers and various renegade groups demonstrate. The difference between the US and the European powers you mention is that the US has a (much?) higher propensity for turmoil. We may think people that march about with placards and guns on their backs decrying "goddam gumint" are funny, but in the US they are taken very seriously, as are are Sarah Palin and Fox News.
Any government takes street demonstrations seriously, not just America. (When a massive demo was organized to meet in Hyde Park, London, to demonstrate against Tony Blair's expected declaration of invasion of Iraq, the government tried to stop it under the Health & Safety Act -- saying that rain was making the ground muddy and people might slip and have an injury! The organizers even had to take this to court to get a ruling that this was a silly argument and get it over-ruled!) I wouldn't have thought that American demos are more violent. In a recent one in Greece protesting against public service redundancies, a policeman was killed. And there were some very violent incidents in the last one in Paris two weeks ago.
The attempt at a sub-prime housing market was the last gasp of an economic system that has any pretence of being able to stimulate prosperity for all. The vast chain of consumer goods of the last 300 years has now ended. It's "Consolidation Era" now -- for those who have the wealth and the know-how to guard it. For three or four decades past, the mass populations of the European countries (and more recently white America) have responded (unconsciously) to this new and growing situation by restricting family size significantly to less than replacement levels. And, to restrict to themselves whatever level of welfare that is available from their governments, electorates are all bodily going right-wing in order to stop immigration. Not sure of what to make of the sub-prime mortgage. IMHO it was not about prosperity for all.
This was government inititiated (even under Bush!) on those very grounds -- that the bottom segment of the population was losing out. The usual income requirements under Fannie were relaxed . . .
Everything I've read suggests it was a carefully worked scam.
. . . and, unfortunately, even these were evaded by crooked estate agents (and then not investigated further by the initial mortgage funders (who then sold the mortgages with the imprimatur of Fannie-quality).
The investment banks knew that people couldn't meet their mortgage payments. What they were interested in was to package secure and unsecure mortgages into securities, get them rated as good investments, and market them to gullible investors including banks. The result was a huge bailout program.
Yes.
What I feel Krugman has argued is not that more money should have been pumped into the US economy, but that it was pumped into the wrong things. It might have made a real difference if the money had gone directly to sectors and selected industries that could have made a real difference to the unemployment rate and hence into increased consumer spending. But that doesn't seem to be the American way.
It's all very well saying that after the event, but the appropriate sort of "shovel-ready" projects that can match the abilities (and locations) of the unemployed can't suddenly be conjured up.
I don't think that declining birth rates in the US (and Canada) have very much to do with the end of "the vast chain of consumer goods of the last 300 years". It has much more to do with the fact that women have now become an integral part of the educated labour force, and while they still want kids, they also want jobs and upward mobility in those jobs. It may even be that being part of the work force is more important to many of them than being a mom to bratty kids.
Yes, my argument is weak here and needs a lot more working out. Once the de-industrializing economy started offering more personal service-type jobs and, at the same jobs, average wages have been declining (as they have been since about 1985) then the economy started adjusting to two-jobs per family being the norm and the pressure for the best possible house and the whole whack of status goods for the house became strong even with what I would maintain to be no really new ones being available but merely the latest and most fashionable versions (kitchen make-overs being a good example). Basically, what I'm trying to suggest is that there is a growing feeling within advanced countries that the modern economy is not delivering the satisfactions that were envisaged for it.
There are huge tectonic plate movements going on in the consumerist world of the West but Krugman and his ilk can't open their eyes wide enough to see them, still thinking the clock can be set back to the sort of "rational" governmentally-planned, Keynesian world of the immediate post-WWII period.Huge tectonic plates perhaps. As for Krugman and his ilk, I don't agree. Krugman probably sleeps with his eyes wide open.
We'll have to disagree here. Krugman has committed himself to his particular line for so many years, and so publicly, too, that it would be difficult, if not impossible, for him to change his ideas.
Keith
At 18:13 20/12/2010 -0500, you wrote:Not sure of what this is about, but Obama does look more and more like a failed President. While he has been successful in implementing measures like a half-baked health care initiative and an extension of umenployment insurance, he's given up a lot of ground to accomplish anything. He has, for example, had to extend the tax cut for the rich despite the growing US fiscal deficit and continuing economic problems. Where is the "Yes we can!" President of a couple of years ago?Keith Hudson, Saltford, England <http://allisstatus.wordpress.com/2010/12/>http://allisstatus.wordpress.com/2010/12/Krugman is an advocate of strong government action and control. What he sees is a President and government that's hemmed in by right-wing "market knows best" views and a corporate sector that increasingly seems to thrive on bubbles. He sees an increasingly divided economy in which the rich are getting richer and the poor are becoming far too numerous. I can understand his concern.Ed----- Original Message ----- From: <mailto:[email protected]>Keith HudsonTo: <mailto:[email protected]>RE-DESIGNING WORK, INCOME DISTRIBUTION,EDUCATIONSent: Monday, December 20, 2010 4:40 PMSubject: Re: [Futurework] FW: [TriumphOfContent] When Zombies Win (Paul Krugman - The NY Times)Free market fundamentalists don't dominate the scene.Paul Krugman is totally wrong. It is banker corporatists. Together with state corporatists, they pretty went dominate the whole scene. They don't do anything much that's essential. They don't make anything. They should be the oil that lubricate the larger economic machine. Instead, they've become by far the largest single economic sector in the country, and the government can do little to control them. And much the same applies to the UK.Who's the zombie? Keith At 12:25 20/12/2010 -0800, you wrote:-----Original Message-----From: [email protected] [mailto:[email protected]] On Behalf Of Steven BrantSent: Sunday, December 19, 2010 11:32 PM To: Steven Brant Subject: [TriumphOfContent] When Zombies Win (Paul Krugman - The NY Times) <http://www.nytimes.com/2010/12/20/opinion/20krugman.html>http://www.nytimes.com/2010/12/20/opinion/20krugman.html OP-ED COLUMNIST When Zombies WinBy <http://topics.nytimes.com/top/opinion/editorialsandoped/oped/columnists/paulkrugman/index.html?inline=nyt-per>PAUL KRUGMANPublished: December 19, 2010When historians look back at 2008-10, what will puzzle them most, I believe, is the strange triumph of failed ideas. Free-market fundamentalists have been wrong about everything yet they now dominate the political scene more thoroughly than ever.28c0607.jpg Fred R. Conrad/The New York Times Paul Krugman<http://topics.nytimes.com/top/opinion/editorialsandoped/oped/columnists/paulkrugman/index.html>Go to Columnist Page »<http://krugman.blogs.nytimes.com/>Blog: The Conscience of a Liberal Readers' Comments Share your thoughts.* <http://community.nytimes.com/comments/www.nytimes.com/2010/12/20/opinion/20krugman.html#postComment>Post a Comment »How did that happen? How, after runaway banks brought the economy to its knees, did we end up with Ron Paul, who says I dont think we need regulators,about to take over a key House panel overseeing the Fed? How, after the experiences of the Clinton and Bush administrations the first raised taxes and presided over spectacular job growth; the second cut taxes and presided over anemic growth even before the crisis did we end up with bipartisan agreement on even more tax cuts?The answer from the right is that the economic failures of the Obama administration show that big-government policies dont work. But the response should be, what big-government policies?For the fact is that the Obama stimulus which itself was almost 40 percent tax cuts was far too cautious to turn the economy around. And thats not 20-20 hindsight: many economists, myself included, warned from the beginning that the plan was grossly inadequate. Put it this way: A policy under which government employment actually fell, under which government spending on goods and services grew more slowly than during the Bush years, hardly constitutes a test of Keynesian economics.Now, maybe it wasnt possible for President Obama to get more in the face of Congressional skepticism about government. But even if thats true, it only demonstrates the continuing hold of a failed doctrine over our politics.Its also worth pointing out that everything the right said about why Obamanomics would fail was wrong. For two years weve been warned that government borrowing would send interest rates sky-high; in fact, rates have fluctuated with optimism or pessimism about recovery, but stayed consistently low by historical standards. For two years weve been warned that inflation, even hyperinflation, was just around the corner; instead, disinflation has continued, with core inflation which excludes volatile food and energy prices now at a half-century low.The free-market fundamentalists have been as wrong about events abroad as they have about events in America and suffered equally few consequences. Ireland, <http://www.timesonline.co.uk/tol/comment/columnists/guest_contributors/article733821.ece>declaredGeorge Osborne in 2006, stands as a shining example of the art of the possible in long-term economic policymaking.Whoops. But Mr. Osborne is now Britains top economic official.And in his new position, hes setting out to emulate the austerity policies Ireland implemented after its bubble burst. After all, conservatives on both sides of the Atlantic spent much of the past year hailing Irish austerity as a resounding success. The Irish approach worked in 1987-89 and its working now, <http://www.cato.org/pub_display.php?pub_id=11881>declared Alan Reynolds of the Cato Institute last June. Whoops, again.But such failures dont seem to matter. To borrow the title of a <http://press.princeton.edu/titles/9270.html>recent book by the Australian economist John Quiggin on doctrines that the crisis should have killed but didnt, were still perhaps more than ever ruled by zombie economics.Why?Part of the answer, surely, is that people who should have been trying to slay zombie ideas have tried to compromise with them instead. And this is especially, though not only, true of the president.People tend to forget that Ronald Reagan often gave ground on policy substance most notably, he ended up enacting multiple tax increases. But he never wavered on ideas, never backed down from the position that his ideology was right and his opponents were wrong.President Obama, by contrast, has consistently tried to reach across the aisle by lending cover to right-wing myths. He has praised Reagan for restoring American dynamism (when was the last time you heard a Republican praising F.D.R.?), adopted G.O.P. rhetoric about the need for the government to tighten its belt even in the face of recession, offered symbolic freezes on spending and federal wages.None of this stopped the right from denouncing him as a socialist. But it helped empower bad ideas, in ways that can do quite immediate harm. Right now Mr. Obama is hailing the tax-cut deal as a boost to the economy but Republicans are already talking about spending cuts that would offset any positive effects from the deal. And how effectively can he oppose these demands, when he himself has embraced the rhetoric of belt-tightening?Yes, politics is the art of the possible. We all understand the need to deal with ones political enemies. But its one thing to make deals to advance your goals; its another to open the door to zombie ideas. When you do that, the zombies end up eating your brain and quite possibly your economy too.!DSPAM:2676,4d0f0695308681540513237! _______________________________________________ Futurework mailing list [email protected] https://lists.uwaterloo.ca/mailman/listinfo/futureworkKeith Hudson, Saltford, England <http://allisstatus.wordpress.com/2010/12/>http://allisstatus.wordpress.com/2010/12/---------- _______________________________________________ Futurework mailing list [email protected] https://lists.uwaterloo.ca/mailman/listinfo/futurework
Keith Hudson, Saltford, England <http://allisstatus.wordpress.com/2010/12/>http://allisstatus.wordpress.com/2010/12/
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