Summary: Here is a powerful summary of the current state of American politics, to the extent that can be done in a thousand words. Feel the strangeness; that is a key aspect of the situation. We are in the midst of a process generating revelations that blow our minds. We can come out of this stronger!
It becomes increasingly obvious that the Democrats seek to impeach Trump for purely political reasons. Obama committed far greater breaches of the Constitution – blatantly, but our rulers did not care because he increased State power. But more interesting is that other elements of America’s elites have allied with the Democrats: the “Deep State.” This might be the most significant aspect of Trump’s time in the White House.
See this as a process. A year ago the great and wise mocked the idea of a “Deep State.” In September, the NYT published “I Am Part of the Resistance Inside the Trump Administration.” by a “senior official in the Trump administration.” It was a coy but open admission of the Deep State’s power.
“…many of the senior officials in his own (President Trump’s) administration are working diligently from within to frustrate parts of his agenda. …I would know. I am one of them.”
Now David Stockman explains how Trump has earned its enmity by taking actions (nothing so coherent as policies) that are contrary to the wishes of the Deep State {gated copy, open copy}. This is by now so obvious that even the New York Times admits it, although they still believe it is proper that the Deep State should have primacy over elected officials: “Trump’s War on the ‘Deep State’ Turns Against Him” – “The impeachment inquiry is in some ways the culmination of a battle between the president and the government institutions he distrusted and disparaged.”
These revelations blow the minds of most people who confront this evidence. It’s too strange to easily describe, and that strangeness is part of the pattern. There are few people who can explain it briefly and clearly. Asking for them to be objective is asking too much. Here is one such man’s summary of today’s situation in the impeachment games. It might not make sense, but we should expect that. We are in ClownWorld.
“The Fumes of Fanaticism“
By James Howard Kunstler at his website.
Reposted with his generous permission, 28 October 2019.
Judging by the volume of intemperate emails and angry social media blasts that come my way, the party of impeachment seems to be inhaling way too much gas from the smoking guns it keeps finding in the various star chambers of its inquisition against you-know-who. You’d think that the failure of Mr. Mueller’s extravaganza might have chastened them just a little – a $32 million-dollar effort starring the most vicious partisan lawyers inside-the-Beltway, 2,800 subpoenas issued over two years, 500 search warrants exercised, and finally nothing whatever to pin on Mr. Trump – except the contra-legal assertion that now he must prove his innocence.
When you state just that, these frothing hysterics reply that many background figures – if not the Golden Golem of Greatness himself – were indicted and convicted of crimes by Mr. Mueller’s crew. Oh yes!
- The Russian troll farm called the Internet Research Agency was indicted for spending $400,000 on Facebook ads (and never extradited or tried in a court-of-law). Pretty impressive victory there!
- The hacking of Hillary Clinton’s emails by “Russia”? Still just alleged, never proven, with plenty of shady business around the search for evidence.
- Paul Manafort, on tax evasion of money earned in Ukraine, 2014? We’ll see about that as the whole filthy business of the 2014 Ukraine regime change op under Mr. Obama gets reviewed in the months ahead.
- George Papadopoulos for lying to the FBI? Stand by on that one, too; still a developing story. {He’s also running for Congress.}
- General Michael Flynn, for ditto? You may have noticed that General Flynn’s case is shaping up to be the biggest instance of prosecutorial misconduct since the Dreyfus affair (France, 1894-1906, which badly-educated Americans most certainly know nothing about). {See the prosecutor’s version; see the defense’s version.}
To set the record straight I’m forced to repeat something that these New Age Jacobins seem unable to process: You don’t have to be a Trump cheerleader to be revolted by the behavior of his antagonists, which is a stunning spectacle of bad faith, dishonesty, incompetence, and malice – and is surely way more toxic to the American project than anything the president has done. Every time I entertain the complaints of these angry auditors, I’m forced to remind myself that these are the same people who think that “inclusion” means shutting down free speech, who believe that the US should not have borders, who promote transsexual reading hours in the grammar schools, and who fiercely desire to start a war with Russia.
That’s not a polity I want to be associated with and until it screws its head back on, I will remain the enemy of it. In fact, in early November I’m traveling to New York City, where the Jacobin city council has just made it a crime to utter the phrase illegal alien in a public place, with a $250,000 penalty attached {see CNN}. I challenge their agents to meet me in Penn Station and arrest me when I go to the information kiosk and inquire if they know what is the best place in midtown Manhattan to meet illegal aliens.
The volume of Jacobin hysteria ratcheted up to “11” late last week when the news broke that the Attorney General’s study of RussiaGate’s origins was upgraded to a criminal investigation {see the NYT’s spin on this}, and that a voluminous report from the DOJ Inspector General is also about to be released. What do you suppose they’re worried about? Naturally the Jacobins’ bulletin board, a.k.a The New York Times, fired a salvo denouncing William Barr – so expect his reputation to be the next battle zone for these ever more desperate fanatics. Talk of preemptively impeaching him is already crackling through the Twitter channels. That will be an excellent sideshow.
Meanwhile, how is Rep, Adam Schiff’s secret proceeding going? Last week he put out a narrative that US Chargé d’Affaires to Ukraine, Bill Taylor, fired a gun-that-smoked fer sure in testimony. Except, of course, as per Mr. Schiff’s usual practice, he refused to issue any actual transcript of the interview in evidence, while there are plenty of indications that Mr. Taylor’s second-hand gossip was roundly refuted under counter-questioning by the non-Jacobin minority members of the House Intel Committee.
Editor’s note – My favorite headline from the “fair and neutral” press about this: “Diplomat Bill Taylor receives rock star reception in Ukraine after House testimony” by Anna Schecter at NBC – “In an interview with NBC News, Taylor declined to answer questions about the impeachment inquiry but praised Ukrainian President Volodymyr Zelenskiy.” No discussion of the many oddities and ironies in this.
Mr. Schiff’s pattern lo these many months of strife has been to claim ultimate proof of wrongdoing only to have it blow up in his face. It’s a face that many Americans are sick of seeing and hearing from, and I am serenely confident that before this colossal scandal is resolved, the Congressman from Hollywood will be fatally disgraced, as was his role-model, Senator Joseph McCarthy, before him.
————————- End of the article. ————————
About Kunstler
James Howard Kunstler (Wikipedia) worked as a reporter and feature writer for several newspapers, before working as a staff writer for Rolling Stone Magazine. In 1975, he began writing books on a full-time basis. Kunstler is the author of 12 novels and has been a regular contributor to many major media, writing about environmental and economic issues. He is a leading supporter of the movement known as “New Urbanism.”
He has lectured at Harvard, Yale, Columbia, Princeton, Dartmouth, Cornell, MIT, and many other colleges. He has written five non-fiction books.
- The Geography of Nowhere: The Rise and Decline of America’s Man-Made Landscape
(1993),
- Home from Nowhere: Remaking Our Everyday World for the 21st Century
(1996),
- The City in Mind: Notes on the Urban Condition
(2001),
- The Long Emergency: Surviving the End of Oil, Climate Change, and Other Converging Catastrophes of the Twenty-First Cent
(2005),
- Too Much Magic: Wishful Thinking, Technology, and the Fate of the Nation
(2012).
(1993),
(1996),
(2001),
(2005),
(2012).For More Information
Ideas! For shopping ideas, see my recommended books and films at Amazon.
If you found this post of use, like us on Facebook and follow us on Twitter. Also see these posts about RussiaGate, about impeachment, how to reform America politics, and especially these…
- The best analysis of RussiaGate: its effects & results – by Emmet T. Flood, special counsel to the President.
- Reviewing “Ball of Collusion”, the big book of 2019 about RussiaGate.
- Political impeachment: Trump’s foes might give America a new & better government.
- Why do Democrats want to impeach Trump?
- The amazing Trump-Ukraine-Whistleblower story in a nutshell.
- See behind the impeachment stories to learn about America.
- Welcome to Third World America. Stand by for a coup.
Useful books about what happened to America
I have not found a good book explaining what happened to the Left, causing its hatred of America. These are the best I have found.
Listen, Liberal: Or, What Ever Happened to the Party of the People?
The Party Is Over: How Republicans Went Crazy, Democrats Became Useless, and the Middle Class Got Shafted
I’m reading, on this site’s recommendation, The Closing of the American Mind, and finding it astonishing and thought provoking. Astonishing that Bloom could observe and select for exhibition in their relatively early manifestations so many of the madnesses that we see today. Whatever it is that has possessed us, it was well under way and visible to the observant and analytical back 30 years ago, though not noticed by most.
Stimulating because I’m finding it a mixed bag. Along with the acuteness of observation and in many cases the acuteness with which he traces the intellectual origins of the phenomena, there are also lots of occasions on which he seems to miss the mark and to indulge in opaque rhetoric. And perhaps a very academic sense of Platonic virtue as an ideal – a rather elitist and aristocratic prescription, when the real problem is only partly how to educate the elite, and perhaps more majorly how to educate the rest.
Still, total agreement is probably the last thing the author would have wanted. Even when one differs, he leads one to think furiously.
What Kunstler writes about in this piece is the outgrowth and flowering of what Bloom observed in its infancy.
Thanks for the suggestion! I have also profited greatly from reading Listen Liberal, another fascinating suggestion.
Yes, its a cultural crisis, and its manifesting itself in all areas of society and intellectual life, and politics has now become one of the main theatres where its on display.
I agree with Henrik’s assessment of Bloom and “The Closing of the American Mind.”
Bloom was well ahead of his time, which probably explains the “opaque rhetoric” that is sometimes found in the book.
“Trump has earned its enmity by taking actions (nothing so coherent as policies) that are contrary to the wishes of the Deep State” Yes, it really looks like the Deep State has finally had it with Trump’s tweets and attempts to change long standing policy. They could even end up backing Elizabeth Warren. They don’t want to see another four years of heretical tweets like this:
The United States has spent EIGHT TRILLION DOLLARS fighting and policing in the Middle East. Thousands of our Great Soldiers have died or been badly wounded. Millions of people have died on the other side. GOING INTO THE MIDDLE EAST IS THE WORST DECISION EVER MADE…..— Tweet, Donald J. Trump, October 9, 2019.
Fighting between various groups that has been going on for hundreds of years. USA should never have been in Middle East. Moved our 50 soldiers out. Turkey MUST take over captured ISIS fighters that Europe refused to have returned. The stupid endless wars, for us, are ending!
— Tweet, Donald J. Trump, October 9, 2019.
Gloucon,
What’s your point? We’re still in Afghanistan. Team Trump has tried to get us back into Iraq (that’s where the troops from Syria were to go, but Iraq said no). We lost in Syria, hence the withdrawal. Africom’s expansion continues, setting us up for a future set of wars.
Trump has not made much of an effort to withdraw. No major speeches, no proposals to Congress. Only a fraction of the effort he put into his core policies, such as tax cuts for the rich.
My point is that Trump has a platform for spreading heretical propaganda against Deep State war policy to his 60 million Twitter followers ever day. Even if he doesn’t completely follow through, do you think the Deep State wants to see that kind of apostasy go on for another four years?
Gloucon,
Yes, I agree. That’s what I said in this post.
Larry, Sorry, but this is one of your weaker columns.
On Obama committing crimes against the Constitution:
I’m a bit confused about this one. You make something related to a good case for your argument but all of your pieces of evidence assume that the victims are citizens of the country (US or Britain). What are the rights of enemy soldiers in a war (even if it is a War on Terror)?
President George W. Bush established the legal concept of a war against a (stupid) idea (which I agree is really dumb) rather than an established nation-state so I suspect that the US Supreme Court would side with Obama on this one (unless they threw out Bush’s legal concepts, which would make me very happy).
The targeting of a single man as an “enemy of the state” makes me extremely uncomfortable and I’d rather just work with other countries to arrest the individual or limit his ability to harm US citizens on US or allied soil.
On to the current article:
To my way of thinking, Kunstler does nothing more than prove that prove the accuracy of the “Closing of the American Mind.”
I favor removing US troops from the Middle East for the reasons you’ve already noted, we have predictably lost the invasion of Middle East, attempting to quell a 4th generation war on their home turf. Now our presence only serves to unify the 4GW forces our troops face and help them recruit additional support.
As I’ve stated before, I do NOT support the way that Trump removed our troops from Syria and the very odd flailing attempts to recover Trump’s lost support while not admitting that he made a mistake in the first place are very uncomfortable for me to watch.
The same goes for President “Bonespurs” fondness for awarding medals to service people when he avoided serving in the military.
Pluto,
Reading the comments is often almost unbearably depressing. The process of citizens voluntarily becoming subjects might be irreversible.
(1) “What are the rights of enemy soldiers in a war (even if it is a War on Terror)?”
I see you’ve accommodated yourself to our new political regime. If you refresh yourself with the old regime by reading the Constitution, you’ll see that the President can’t declare someone an “an enemy soldier” and have him blown away as he rides down the street. That was prohibited by Magna Carta. Nor does the Constitution give judicial power to our intel agencies (esp since they have proven themselves to be incompetent, corrupt, and politicized).
(2) As for the stuff you don’t like, who cares? Is doing stuff you don’t like reason to overturn an election?
Larry, I have no problem believing that reading the comments is almost unbearably depressing. I am not tough enough to write a daily analysis/opinion column. I applause your courage and your usually high standards.
(1) “I see you’ve accommodated yourself to our new political regime. If you refresh yourself with the old regime by reading the Constitution, you’ll see that the President can’t declare someone an “an enemy soldier” and have him blown away as he rides down the street.”
No, I have NOT accommodated myself to the new regime. I was attempting to work out if Obama had broken the law/Constitution. As long as the so-called “War on Terror” legal framework is in place, I’m afraid that there is no legal justification for your argument, and I really DO mean “afraid” as I would personally prefer to arrive at another conclusion.
The vicious personal nature of 4GW is why a military response by an established country to it is a terrible choice. The extremely short window of opportunity to hit targets has caused Congress to give away too much of its power to the President. Which is what led you to write today’s article. So from a moral and sustainable perspective, I agree with you but from a legal perspective I am in reluctant disagreement.
Unless Obama literally chose a man out of a photo and pointed at the person without any military intelligence telling him that the man was an “enemy combatant” (another phrase which I despise), I do not see the legal (as opposed to a moral) difference between Kennedy’s invasion of South Vietnam (to save the citizens of our ally, South Vietnam, from Communist infiltrators) and Obama’s orders to attack somebody he believed was going to cause the death of US citizens by infiltrating a country (US or allied to the US) and attacking them.
Now you could argue that Kennedy was in violation of the Constitution as well and I’d ask for a comparison between that and Wilson’s declaration of war against Germany in 1917. I would not be surprised if you made a good case…
“(2) As for the stuff you don’t like, who cares? Is doing stuff you don’t like reason to overturn an election?”
You are, of course, correct. I was attempting to indicate that I am not a Trump supporter even when he does something of which I approve. And he has done several things that I do approve of.
Who argued that I was trying to overthrow an election? Trump won the election using a perfectly acceptable Electoral College argument. The fact that Hillary had evidently NOT considered the possibility shows how inadequate she would have been as a President.
Pluto,
“As long as the so-called “War on Terror” legal framework is in place, I’m afraid that there is no legal justification for your argument”
You’re just making stuff up. Nothing in the War on Terror legislation allows the president to order the assassination of US citizens driving down the street. The President’s justification was dismissed as ludricous by most legal experts.
https://en.wikipedia.org/wiki/Anwar_al-Awlaki#FOIA_documents
Pluto – follow-up note —
Even if Congress granted explicit authorization to the President to kill US citizens without warrant or trial – while they are driving down the street – that would violate several core aspects of the Constitution. I feel sad that I have to point this out to you.
Larry: “You’re just making stuff up. Nothing in the War on Terror legislation allows the president to order the assassination of US citizens driving down the street.”
My apologies for not doing my homework, Larry. I was probably aware that al Awlaki was an American citizen at some point but I’ve recently been suffering severe memory problems and failed to check the data before writing my previous posts. Your point is completely valid and I withdraw all previous comments.
I’m a little surprised that the Republicans chose not to use this as a pretext to start impeachment proceedings. I know you blame the “Deep State”, I haven’t been completely convinced that any such thing formally exists yet.
I’m willing to go as far as a bunch of Washington insiders who are rewarded with power and prestige for maintaining a set of policy goals but I’m not yet convinced that it is organized. Please share any verifiable information you have on this subject.
Pluto,
With all the things swirling around as we descend into ClownWorld, disorientation is an ever-present danger. I get it daily. It is much worse when under personal stress.
My best wishes for your recovery! I’m struggling with the job market, being overqualified or too old (or both) for so many jobs in Iowa.
Again, my congratulations for your unusual insight and honesty, displayed in your comment.
Larry: “I’m struggling with the job market, being overqualified or too old (or both) for so many jobs in Iowa.”
Sorry to hear that, Larry. I’ve had my fair share of problems finding jobs over the years and know how stressful it can get.
I cannot imagine that continuing to write this column reduces your stress levels significantly and I appreciate your efforts to keep the quality of your column as high as possible.
Best wishes on your job hunt!
Pluto,
Making it worse is that I’ve not looked for a job since 1978. I’ve always been recruited. Until this year, I had never made a resume. Not having fun.
Oddly, my 24 year old son is also having difficulty. BS in business (specialty logistics) and minor in statistics. He has some good entry-level experience. But no luck. He was just turned down for an entry-level job at Lowes!
I read that the unemployment rate in Iowa is 1% and that employers are desperate for workers. Total bs. Employers are buried in applications for every opening, and are (and can be) insanely picky about hiring.
Larry: “Oddly, my 24 year old son is also having difficulty. BS in business (specialty logistics) and minor in statistics.”
Has he considered working for CH Robinson? They are (or at least were a couple of decades ago) the largest logistics company in the world.
Larry: “Employers are buried in applications for every opening, and are (and can be) insanely picky about hiring.”
This mirrors my experience in a similar job market. My friends, all either retired or in long-term full time positions had severe difficulties believing what I told them but have slowly come to understand.
I would also add that a few employers have become predatory. Offering jobs to desperate people to do things that they would not willingly do otherwise, or hiring at a very low salary and being willing to accept employee defections once they gain enough experience to become employable in the larger job market.
The situation is close enough to 1927-1929 to make me wonder. History rarely repeats itself but it frequently rhymes.
https://en.wikipedia.org/wiki/Causes_of_the_Great_Depression
Pluto,
“I would also add that a few employers have become predatory.”
There have already been some such, but such policies seem to have become normalized. Hire people for low wages-part-time-seasonal, work them until they leave, repeat. Title them as managers so that overtime isn’t required, and encourage them to work their hearts out for the illusory gain of real management jobs.
I find that this is the norm in sales. Hire people at full commission, invest nothing in them, let them work until they give up – their revenue is mostly profit. Since people have become wise to this, positions are advertised in misleading language. My favorite is one for a major soup company: sales management, where you supervise cans of soup.
This indicates that there is a moderate surplus of labor in most fields. Its the capitalists dream, best expressed by Marx as having a “reserve army of labor.”
“The situation is close enough to 1927-1929 to make me wonder.”
Look at that article. Today’s labor dynamics have almost zero similarity to that period.
Larry: “Look at that article. Today’s labor dynamics have almost zero similarity to that period.”
Can you explain your comment about labor dynamics?
Pluto,
It’s your claim. What are the similarities between the labor market today and that of 1927-1929?
Larry: “It’s your claim. What are the similarities between the labor market today and that of 1927-1929?”
Actually I was looking at the Stock Market and Credit situation, not the Labor markets. But I’ll rise to the occasion and see what happens.
Article: In the first three decades of the 20th century productivity and economic output surged… Sometime after the peak of the business cycle in 1923, more workers were displaced by productivity improvements than growth in the employment market could meet, causing unemployment to slowly rise after 1925… Wages did not keep up with productivity growth”
Although our business cycle didn’t peak 6 years ago, it appears to have peaked. Also wages have seriously not kept up with productivity and general wealth growth for anybody who doesn’t get most of their income except the stock market.
Below is a personal theory that has not been validated:
We are currently in a period of slight deflation because of the following:
1. The corporations generate a LOT of money that they pay in the form of stock dividends and stock repurchase programs. They also give executives large numbers of shares of stock to keep the current cost of the executive’s compensation down.
2. The executives have been selling their shares for the last few years and parking the money in money markets, gold, and other safe havens. The odd thing is that they have NOT been using their earnings to buy large quantities of shares of other companies.
3. Then the corporations, which the executives control, authorize more stock repurchase programs. This gives the companies more shares of stock to give to the executives and fewer shares of stock on the market, which drives up the earnings per share, which is one of the major ways that stocks are measured.
In the short run it seems as if everybody benefits or at least nobody gets hurt. Sadly, that’s not exactly true. The reason it has gone on as long as it has is that the negative interest rates in the rest of the developed world have persuaded their investors that the US is the best place to put more and more of their money.
Pluto,
(1) Take all those super-confident facts about the early 20th century economy with a large dose of salt. It’s mostly guesswork. There was almost no data collection before the 1930s. The system of the great National Income Production Accounts (generating GDP, etc) went fully online during WWII.
(2) “Although our business cycle didn’t peak 6 years ago”
You are conflating the normal business cycle with giant secular shifts – such as the Great Depression. They are unrelated.
(3) “it appears to have peaked.”
Write up your analytical method and wait for your Nobel Prize in the mail! Statements like that are far beyond the current state of economic science. When you read people making such statements as fact, stop. You are wasting your time.
(4) “Below is a personal theory that has not been validated:”
I suggest you leave economic analysis to people with extensive training in economics. It’s not a subject for amateurs.
Larry: “(1) Take all those super-confident facts about the early 20th century economy with a large dose of salt. It’s mostly guesswork. There was almost no data collection before the 1930s. The system of the great National Income Production Accounts (generating GDP, etc) went fully online during WWII.”
I was concerned about that as well but couldn’t find any statistics current to the time, which you have explained. Which leaves me wondering about the sources for your comment: “Today’s labor dynamics have almost zero similarity to that period.”
Larry: “(2) “Although our business cycle didn’t peak 6 years ago”
You are conflating the normal business cycle with giant secular shifts – such as the Great Depression. They are unrelated.
(3) “it appears to have peaked.””
Agreed that the business cycles of 1929 and 2019 are unrelated. I didn’t want for somebody to raise the concern that the difference between the business cycle peaking in 1923 vs. the general concern expressed by the Federal Reserve that the business cycle has peaked.
But, as you’ve noted, economics is the only science where a prediction is made about the current situation using data gathered 3 months ago has a disturbingly high degree of likelihood that the prediction will be inaccurate. Economies are NOT simple things, especially when you try to predict something as big as the US economy.
Larry: “(4) “Below is a personal theory that has not been validated:”
I suggest you leave economic analysis to people with extensive training in economics. It’s not a subject for amateurs.”
Agreed again. My theory is based on the work of academic peer-reviewed experts with extensive access to stock market data. Below is an example, but by no means the only piece of the work done by these individuals. The only thing I’ve done is copy their work and slightly extend it for international transactions. Even without my work, the expert’s theory holds together but is not yet proven.
https://www.zerohedge.com/news/2019-02-27/insiders-just-sold-most-stock-decade
I should mention that I would be horrified if anybody actually made any transactions based on my theory. The likelihood that they’d be financially injured would be extremely high this is an unproven theory at best. I probably should not have even shared my thoughts.
Pluto,
“Today’s labor dynamics have almost zero similarity to that period.”
Go outside and walk around a major city. You don’t need a supercomputer to see that we have relatively low unemployment, stable prices (no widespread deflation or inflation), and slow growth – with no massive economic imbalances. But determining where we are in the giant economic cycle picture – as you described – can’t be seen without accurate and broad economic statistics by year.
Unemployment of 2% and 4% are quite different. To use a crude analogy, is today 2°F warmer/colder than yesterday? It takes and instrument to answer.
(2) Economic analysis from Zerohedge
Unless you are well-grounded in economics and finance, reading Zerohedge makes you dumber. Almost everybody who posts here with crackpot ideas about economics and finance quotes Zerohedge. The internet makes freely available both exciting infotainment and real news and analysis. The vastly greater relative popularity of the former shows American’s revealed preferences. Which makes sense. Citizens need information and insights to help run America. Subjects just want entertainment and fun stuff about which they can whine.
To use your factoid – insider sales reliably predict absolutely nothing. Not the stock market, not GDP, nothing. We have Leading Economic Indicators to shed a little light on the economy. As for predicting stock prices, nobody smart enough to devise a predictor would be stupid enough to publicize it.
Larry: “Go outside and walk around a major city. You don’t need a supercomputer to see that we have relatively low unemployment, stable prices (no widespread deflation or inflation), and slow growth – with no massive economic imbalances. But determining where we are in the giant economic cycle picture – as you described – can’t be seen without accurate and broad economic statistics by year.”
Your statements appear to be contradictory. The first one says that anybody just walking around can see that the economy is doing well by walking around (that was also true up until seconds before the Great Depression).
The second statement says that you can only determine the current state of the economy using accurate and broad economic statistic by year.
Larry: “Unless you are well-grounded in economics and finance, reading Zerohedge makes you dumber.”
Agreed, you’ve made perhaps the most accurate statement of the year. I happen to have formal education in both Economics and Finance (although my career went a different direction because of computers).
Zerohedge is mostly filled with semi-accurate statements and strongly held opinions with little explanation but this article hit a sweet spot in terms of introducing the theories I’ve been reading about from a wide range of sources (and I cross-check the underlying facts before accepting them) and providing enough basis to not be casually dismissed.
I see the political parties, and the divisive rhetoric as the problem. If you run your family, friendships, cities, and nation focusing exclusively on differences, then you are doomed to failure.
FIRST work on things you agree, then work on those differences. The founding fathers designed a government that requires COMPROMISE.
Having lived in third world nations, I believe we take much for granted. We have a lot to loose.
Catfish,
“I see the political parties, and the divisive rhetoric as the problem. ”
That confuses effect with cause. When a people fracture into groups with different core values, their politics will follow suit. Rhetoric will become “divisive” because the people are divided.
The Protestant Reformation and the Civil War did not occur because people were saying nasty things about one another, but because people disagreed about core beliefs. That’s happening again.
Similarities between the late 1920’s and today
I recall Galbraith arguing, don’t know whether he was right or what he based his view on, that the late twenties boom was unsustainable because while productivity and production was rising, total wages were not, and so there were insufficient customers at prices which would generate profits in line with growth. I think it was in Galbraith where the phrase ‘profitless prosperity’ was used to characterize what was happening.
If he was right about wage stagnation, surely something similar has happened in the US and elsewhere in recent years?
It never struck me as a satisfactory explanation because you had to explain why wages were stagnating. Galbraith’s argument would imply that unionize, set minimum wage, regulate so as to increase salaries in general, and the increased purchasing power would lead to redistribution of corporate earnings and so permit sustainable growth.
It seemed to me the Austrian explanation of the phenomenon, assuming it is a real one, is more likely correct: the huge growth in the money supply and in debt consequent on the foundation of the Fed led to malinvestment, and this is what caused certain sectors to do very well but others, particularly those employing the people experiencing wage stagnation, not to.
Still, isn’t there a parallel here in the behavior of wages? And perhaps another parallel in the intervention of the Fed to produce an environment in which taking on of huge levels of debt seems affordable and the only sensible course?
henrik,
You have not pointed to similarities between the late 1920s and today. Much of what you’ve said is wrong. I’ll take just one example.
” the late twenties boom was unsustainable because while productivity and production was rising, total wages were not, and so there were insufficient customers at prices which would generate profits in line with growth. I think it was in Galbraith where the phrase ‘profitless prosperity’ was used to characterize what was happening. If he was right about wage stagnation, surely something similar has happened in the US and elsewhere in recent years?”
That is pretty much the opposite of what we have today.
As I said, economics is not a subject for amateurs.