Sunday, May 3, 2015

The Painful Unvarnished Truth Why Our Economy Sucks

The inimitable Karl Denninger, businessman, finance blogger, and political activist, sometimes referred to as a founding member of the Tea Party movement, has written an article of importants at Market Ticker I'm going to quote it in full (because his links usually expire within a few weeks). Please take the time to read it through:

The Classic: Lie, Obfuscate and Deflect

You knew it would come, right? The attempt to blame all on.... liberalism.
"Of those governments, perhaps the most salient fact to the objective political scientist, tasked with anatomizing the failed system, would be that both governments have long effectively functioned as one-party systems. Baltimore last had a Republican mayor, Theodore M. McKeldin, in 1967. (A wire photograph from April 1966 captured McKeldin, a bear of a man, chatting amiably with Dr. King in Baltimore, two years before the civil rights leader’s assassination in Memphis.) Maryland elected its incumbent Republican governor, Larry Hogan, in November – but that made Hogan only the second GOP governor in the Old Line State since 1969.
Incumbent mayor Stephanie Rawlings-Blake, a Democrat, deals with a city council comprised 100 percent of fellow Democrats. Other important power blocs in the political and civic life of Baltimore are likewise controlled by Democrats, such as educational institutions and public-sector unions."
See, that's easy. Just blame "one party" rule, as if the Republicans have "better ideas" without demonstrating how their ideas are better or even providing examples of alleged ideas to be implemented. Nobody, of course, wants to ask the salient question: Exactly how did these cities become one-party political machines?

That, of course, is because if you were to go there you'd expose the soft underbelly of corruption in the political process -- the making of political promises that the maker knows cannot be fulfilled but doesn't care as he or she is buying votes, not results. In the meantime behind the scenes even more-perverse and outrageous corruption is taking place; the selling of America, literally, to the highest bidder.

And rather than perform its job as a guardian at the gate the press fawns over such people and their espousing of various programs without a single critical examination of the issues at hand or a question being raised.

Let us put reality out there for everyone: No, not everyone is exceptional. In fact most of us are downright ordinary and even there, if we're in the middle of the bell curve somewhere instead of out on the ends, fully half of us are on the wrong side of it!

The question to ask becomes simply this: What are you going to do about that fact given that we all must somehow manage to find our way in the world?

This is a cancer that we invited into our nation with so-called "free trade" and the exporting of our manufacturing base. It is the one we refuse to discuss and debate, yet we must. We instead try to placate and paper over it while at the same time destroying the programs and structures that led individuals in that situation to have productive, happy lives.

We then wring our hands when despair turns to crime and rioting.

Baltimore was a thriving industrial community that produced, among other things, a huge amount of steel. But Baltimore lost over 100,000 manufacturing jobs by 1995, all due to foreign imports produced under near or actual slave labor conditions with zero regard for environmental impact. One third of the residents of Baltimore fled the city. Worse, 90% of the jobs in Baltimore today are low-paying and often part-time service-sector jobs.

Did liberals alone promote all the so-called "free trade" that led to this manufacturing displacement? Hardly; that charge can equally be leveled against Republicans.

 At the same time deficit spending, which both political parties consider sacrosanct, has destroyed the ability to accumulate wealth for anyone that is in the lower economic classes. Adding to this was outright and documented predatory behavior by financial institutions toward city residents, especially black city residents, via subprime lending.

Where is the debate on these topics? It's missing from the political sphere for a very good reason: To address this you must address facts -- such as the fact that if the "average" IQ is 100 then half of the people will be above and half below; unless you're willing to literally murder the lower half of the population you need a social, employment and political system that provides opportunity for all.

That in turn means you cannot export your lower-wage and lower-ability-required manufacturing jobs to places like Vietnam and China as they must be retained so your citizens have gainful employment available to them.

At the same time you cannot deficit spend because for the person in the lower economic and intellectual quantum there is no defensive move available to them to mitigate the damage done to their financial security by such policies.

Finally, accountability for every dollar spent is far more important when you have few dollars to contribute to government programs in the form of taxation. In this regard both Democrat and Republicans fail; our current so-called "educational" system is an utter and complete joke when looked at in terms of return-on-investment.

Are you ready to have a debate on these topics yet, America?

Or will you wring your hands and point fingers, as is often the case, at this bogeyman or that while ignoring the elephant in the room -- the intentional destruction of working-class jobs in this nation over the last 40+ years, and our utter refusal to put a stop to the abusive and outrageous "trade policies" that enable it. 

 You can read more views on this subject @The Bayou Renaissance Man

(I ask you: Why can Apple make 486 Billion Dollars last quarter by making iPhones for $12 overseas and sell them for $600, but  cannot provide jobs for American workers?)