that what is right or true for the individual is applicable to everyone at the same time. If one person stands at a football game, they see better. If everyone stands, many, including that person, may or may not be able to see at all. If one person forgoes buying a car, they save some money. If everyone avoids buying cars, the industry falls on its face, massive unemployment results across many companies. As individuals and businesseses we are limited by our bank accounts, and ability to leverage. The government does not have that constraint.
Our government doesn't need to borrow to spend. The first bonds they ever sold, the first taxes ever paid, required the payment be made in our own currency. Unless it had been distributed beforehand, no one could have paid the bill. The government is not constrained by needing to borrow.
It IS constrained, however, by what people think of the "dollar". You think it is bad? I don't see anyone throwing away their worthless dollars. I don't see countries rushing to rid themselves of it. I see transactions worldwide being settled in the dollar, and countries holding trillions of it in reserve. (I do see China trying really hard to supplant it, but for at least another 17 years or so they are probably not a serious threat). It is bad for 30 million individuals, (actually a few more, and a lot of cities and states), but there are lots of companies making record profits, many from foreign investments, and a lot of governments still settling transactions in the dollar.
The pain being felt by some is bad because the government and private business conspired over the past several decades to work for short-term profit while screwing everyone else. We put laws on the books because of the Great Depression that would have kept some of these excesses from occurring, and the socialists tried to teach us that we are dependant on each other's success but, alas, things have changed. For example, the ex-chair of Goldman Sachs, Rubin, went to work in the government and in 1999 repealed the last piece of the Glass-Steagall Act. This (among several other actions over the years, along with a lot of non-feasance by officials in the SEC, Federal Reserve (Alan Greenspan), the ratings agencies, a ton of mortgage underwriting companies and others) allowed the investment banks to get into a game formerly run by somewhat conservative banks who made loans based on ability to pay. This changed the game, and the focus became how much money (now including FDIC insured deposits), they could sell as debt wrapped up in mortgages to turn into collateralized debt obligations and other derivatives where investors leveraged trillions of dollars to purchase, well, crap. Ability to pay was became secondary to the pursuit of selling more debt.
The second thing that the private market did was, over decades, use the excuse of globalization to move lots of technology out of this country to places where labor was cheap and laws that kept people from mistreating others did not exist, (laws that we, as Americans, had decided were important, and perhaps will again, I suspect - but I digress). They then brought those products back in at cheap prices, while people ignored how they were spending against their own best interests.
Private industry, in concert with their lobbyists, has pursued a policy of using the government to suck up wealth for decades, while most people really did not realize what was happening to the economy around them. These evil, greedy , selfish bastards have done everything they could to take money out of the pockets of those who labor for it, and, frankly, I have trouble imagining the lack of understanding it would take to believe that they would suddenly be the salvation for us. That said, of course business is the one that creates jobs. But they have relied on government to create the conditions where they could, and to fund the startups (and more), to use the military (state or federal) to force, or even kill those who would stand in their way, from very nearly the inception of this country. (note - ARPANET, now the Internet, that we are on was a government-funded project that business now claims as its own).
On the other hand, the people have allowed the government to play right into their hands. Which is too bad, because that was the only protection the common person had against the selfish, avaricious, arrogant cowards that run these companies. Our current president told bankers at a meeting in 2009 that he was the only thing standing between the "pitchforks and them". I think he made a mistake in not using that moment to turn his back on them and protect the people he said he would serve. We will see where that leads us.
That said, the only hope that people have is government, but $50 billion is chump change. We need over $600 billion just to fix the highway bridges that are structurally unsound in this country. It would take, quite literally, mulitple trillions of dollars to begin to reverse the damage done to our economy over the past few decades, and that's just hardware. They would have to fund the revival of scores of factories that are only so much rubble today (even if their walls are standing the machinery is decades behind the newer and more efficient factories). There would have to be something of a guaranteed income program, we would have to absorb the debt from mortgages that is hidden on the banker's books, we would have to figure out the goals for the technological changes needed in the future and develop a new and sizable educational program to accommodate that (which avoided graduating a bunch of people with student loan debt and no possibility of jobs).
But the most important thing would be a change of heart by the people in the government. They would have to begin to raise public awareness as to who benefits, who is winding up with the money, and what needs to change. They would need to quit throwing scraps of little programs to people to get their little group happy for a while, suck it up, and lead us into a century where China is not going to equal our economy in 2027, as the chief economist at
Government Goldman Sachs suggests,
here....
I would have to short the prospect of the government (the people) suddenly coming to Jesus on that one, at least not until the next real Depression-like disaster (or worse) that affects most of the people. Not that we couldn't, but more likely we will fight our stupid little battles over Mosques\Community Centers and Palin and Teabaggers and Healthcare and (throw your favorite in here) while the rest of the world runs over us. That's how little power centers within civilizations seem to deal with change. If our enemy is in a uniform, we are really good at creating a program to drop a missile on his left foot, third toe in. But when the enemy is us, well...
Btw, you pointed to a well in the Gulf as evidence that there is oil? You do realize it is capped (or will be shortly), right? Can't get much use out of that. Sure there is some oil out there, but getting it out of deep water in the Gulf, or from shale deposits in the frozen North is much more expensive, dangerous, and complex than getting it from the wells in Oklahoma. Much of the easily gotten to oil is gone, along with our high carbon steel which we exhausted years ago. Sure, we can put those wells I grew up with in Oklahoma back into production, but your gas will be $6 gallon or more - I double dog dare you to dig your way out of the depression that is going to bring. (Ever see a chart of the recessions that have followed every oil spike for the past decades?). Not to mention the starvation and war that is going to come along with it. It is entirely within the realm of possibility that we are in Afghanistan, Iraq, etc, as a smokescreen to get us embedded so other nations can't take the oil. (Whether that plan works out in the future is anyone's guess).
But that is 1940's thinking - people watch too many movies in which the brave Americans beat back the Germans and Japanese. In our brave new world, while we are running around thinking that we are going to send more soldiers to solve our problems, China is going to grow, and grow, while we wither. Do you think they have sent their teachers here, paying their salaries, room, and board, because they want to learn from us? Or is it more likely they are studying us from the inside? They are thinking of their own best interests, as they should be. And when they own our financial institutions, and they will, it is over.
And no, I don't think the oil companies are short-sighted. I think they have recongized that the future is global and quite likely outside of the United States. And that is why they have opened offices around the world, are making deals with foreign governments, and some of the largest solar production facilities now sport a new logo. You may have seen it - looks like a sunflower - has the letters BP in the center.
('Course, I could be all hot air. I do wonder, however, if there was a conversation along about 1750 in Britain, along the lines of "you know, all those lazy adventure-seeking hippies who ran off to that place called North America - you know, where we make them pay those high taxes and send us tobacco - we are ALWAYS going to be bigger and more important than they are, 'cause we are GREAT Britain...")
IMO, unless we grow up and realize that we have to change our way of thinking, invest in our people and our country, come to a realization that it is unlikely that we are going to survive on customer service and nursing jobs, we might, sooner than we think, be following Great Britain into history, while listening to our foreign language tapes to figure out the differences between those 12 Chinese languages...
thanks for the reply
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