I've been spending a bit of time wondering why Ben Bernanke's choppers are grounded. Why isn't "Helicopter Ben" out there throwing bales of $100 bills out of helicopters over the inner cities and working class suburbs of our nation? After all, Keynesian economics maintains that if you have slack resources in your economy, it's because people don't have enough money to buy all the output that the economy is capable of producing, and thus printing money is the correct thing to do. And Friedman's monetarism pretty much says the same thing even more clearly -- it was Milton Friedman, not Ben Bernanke, who originally proposed money drops as the solution to a down economy.
So why doesn't Ben do it? Thinking on an article at Ranger's place, and slotting in an additional piece of information -- the Chinese ambassador begging Bernanke not to crank up the presses -- and then it clicks: Money drops wouldn't do a thing for employment in America, because all the stuff we'd buy with that freshly dropped money comes from China. It'd do wonder for employment in China but would do fuck-all for employment in America.
In short, we're more fucked than I thought. This also explains why the Chinese ambassador was begging Bernanke to not print money: We're trading freshly-printed dollars for these Chinese goods, so we're actually exporting our inflation to China as well as our jobs. And if Bernanke started doing money drops, it'd create a virtual typhoon of inflation -- in China, not in America, because all those freshly printed dollars would end up in China, not in America.
In short: We are fucked, good and hard. De-industrialization and the transition to a "service" economy has serviced us, alright. Like a stallion services a mare, that is. If you ain't waddling, it's just a matter of time. Just sayin'.
-- Badtux the Economics Penguin
Deep conspiracy theorists would say that exporting inflation to China is by design. Destabilize the social system of a rival power through non-exploding means, don't you know.
ReplyDeleteI don't think TPTB are that deep-thinkingly intelligent, though. I think they're just a bunch of greedy, sociopathic lizardos who have no long-term plan, just to grab what they can right now.
Either way, we're screwed. Which is all the more reason to be glad for what we have, when we have it. Do you realize what a miracle it is to have the lights come on when you flip the switch, and clean drinking water to come out of the tap? For those of us in the Western World, the last 100 years have been the greatest time in human history. I try to keep that in mind when I think about all the bullshit, to give it a bit of perspective.
I think Bukko is right for the most part. These people aren't bright enough for a large plan. They just make money regardless of where things are actually produced but they happen to make slightly more if the goods are produced outside of the USA so they go that route. Meanwhile, the working classes are feeling the pinch to the point where they have to buy cheaper goods produced in China and elsewhere in order to just get by. They also don't always make the connection between buying foreign goods and their own jobs, instead preferring to believe the lie handed down to them by TPTB that government policy is the cause of their joblessness.
ReplyDeleteWhat gets me though is that these greedy "lizard people" are doing everything in their power to prevent a real economic change of the sort that would be really good for our country. What if we had a system where it was easier and a little bit less risky to become an entrepreneur? What if we had decent infrastructure so customers and supplies could reach businesses more easily? What if had a really good public education system that gave people the skills they need to run a business? What if we had government programs that helped new businesses get loans for their start up capital? What if we had universal health care coverage so that people striking out on their own don't have to literally risk their lives to do so?
I actually still believe in American ingenuity. I know that there are a lot of amazing creative people with good ideas who don't do anything about it because they have families and need health insurance or they don't have access to the capital or they simply don't know where to begin. It is sad really.
I have faith in entrepreneurial spirit, as well. But I know the current masters of America are as anti-competition as they are anti-democracy. The giant corporations are all experts at crushing potential competition.
ReplyDeleteSo, yes, anti-capitalism as well. And all the while calling out any criticism as being communist or socialist...