WHEN FOOLS ARE IN CHARGE: Lawless government behavior leads to bad economics And yet we see this over and over when democrats have the power. This ignorant choice by the Obama government to intervene in the marketplace means a further drag on the economy's recovery. Had they allowed the bankruptcy process to proceed, GM (and Chrysler) would have been liquidated. New owners could then start over and hire workers based on the non-union rates offered in other states that now produce Hondas and other makes at competitive world market rates. As it is GM has been artificially propped up by the government and therefore will not learn how to compete in a highly competitive marketplace. Sure they will do okay for a while. The government will demand its fleet acquisitions are GM products. They will do okay with certain models. Long term, however, they are toast because they will not be able to match the productivity of their competitors. Mark it down.
DUBIOUS ANNIVERSARY: Communism at work And here is a paragraph from John Fund's article that tells us all we need to know about the utter depravity, venality and corruption that passes for the democrat party. Somethings don't change in 35 years or so:
I was living in San Francisco during the period when Jim Jones was a Democratic power broker, known for his ability to deliver thousands of votes. I recall that in 1976, Assemblyman Willie Brown, later the longtime speaker of that body, compared Jones to Martin Luther King, Angela Davis, Albert Einstein, and Chairman Mao in an introduction. That same year, Walter Mondale, Jimmy Carter’s vice-presidential candidate, met personally with Jones. So did Jimmy Carter’s wife, Rosalynn. Among dozens of accolades from leading Democrats that Jones collected was this one from Joseph Califano, who was secretary of Health, Education and Welfare under Jimmy Carter: “Knowing your commitment and compassion, your interest in protecting individual liberty and freedom have made an outstanding contribution to furthering the cause of human dignity.”
THE END OF PEAK BLUEProductivity Up, Future Uncertain
Productivity increases are almost always a good thing, but this time, rising productivity hasn’t translated into more jobs or higher wages. This has happened before, but it wasn’t easy. Can we transition again?
Unemployment is high, wages are stagnant, inequality is higher than its been in years, yet America is as productive as ever. Total productivity—essentially measured by how much a worker can produce in one hour—has risen substantially over the past quarter, growing faster than it has since 2009, according to a new Labor Department report.
This is both good news and a sign of the trouble we are in. Basically, it is always good when productivity goes up. Rising productivity means that capitalism is working: some combination of technology, management and competitive drive is enabling Americans to get more done—more widgets made, more meals cooked, more diseases cured—in less time. If absolute poverty is going to be defeated, if more people are going to be freed from repetitive, meaningless work, if humanity is going to have more time for art and culture because it spends less time in drudgery and toil, productivity must continue to rise.
But in times like ours, the link between productivity and wages looks broken. Back in Peak Blue, when the post-WWII model of mass production and mass consumption was working at its best, rising productivity translated very quickly into rising wages for most workers. Unions used those productivity figures to bargain for raises, and competitive pressures in a tight labor market forced employers to offer rising wages along with the trend in rising productivity. There was a close connection between the productivity level and the wage level.
That isn’t true today, and it hasn’t been true for the last thirty years. Lots of factors are at work, but the core issue has been the decline in manufacturing jobs. While the US is more productive than ever in manufacturing, fewer people have jobs in the field than in 1973. Add that shift to the mass entry of women into the workforce, throw in high levels of immigration (legal and illegal), and it is not surprising that wages have stagnated even though productivity has grown. And there’s another factor; productivity in some service sector jobs is harder to raise than in manufacturing. It is harder to increase the number of bedpans per hour that a hospital worker can change than to increase the number of widgets per hour a manufacturing worker can process.
So does that mean that the link between capitalism and rising living standards has broken down for good? There are lots of people who seem to think so, but history suggests they are wrong. The early Industrial Revolution, for example, was another period when productivity was rising fast but wages and living standards for many people were stagnant or falling. (They didn’t keep the same kind of statistics then that we do today, so direct comparisons are impossible, but the overall picture seems pretty clear.) In those days, agriculture was shedding jobs as British landlords shifted from renting small plots at low rents to subsistence farmers to more profitable but less labor intensive methods of agriculture like raising sheep. The combination of peasants flocking to the cities and skilled workers losing their jobs to new automated techniques meant that more people were looking for fewer jobs. Living standards for many workers fell sharply, and Britain was convulsed by waves of social unrest.
Making things worse, huge new fortunes were made both by the landlords getting rid of ‘excess’ peasants and the factory owners hiring workers (including children) for pennies. It was not a happy time, and many people looking at England in that era, including Karl Marx, believed that a social revolution was inevitable.
In the end, the industrial revolution made pretty much everyone better off in most ways (though arguably jobs in steel factories and coal mines were neither as healthy nor as fulfilling as the traditional jobs on the land).
The information revolution seems to be following a very similar pattern. Old jobs are disappearing faster than new ones can be created, and rising inequality combined with stagnant living standards is making people rightly unhappy. Irritating fortunes are being made while millions of people struggle. Yet the underlying productivity of society as a whole is going up.
Instead of fighting a process that offers us and the rest of suffering humanity its best hope of better living in the medium to long term (and people should never forget that an information economy is going to be better for the environment than an industrial one), we should be thinking about how to manage the change as best we can, and how to accelerate the creation of new jobs in new fields as the old ones fade away. The key to restoring the link between productivity and wages so that the rising tide lifts more boats is to increase the demand for labor. As that happens, wages will rise, competitive pressures to attract good employees will rise, and workers everywhere will have more bargaining power when they negotiate with employers, whether through unions or as individuals.
Enabling more self employment, promoting small business formation and development, lightening the tax and regulatory burden on job creation and shifting some of the government’s research focus and capacity from research into agricultural and manufacturing based fields toward research that benefits the rise of a job-rich information economy are all things that we can and should be doing. They don’t even have to cost much money.
Rebuilding society in the aftermath of a broken social model is a big job, and creating an advanced information society will require even more social, economic, ideological and cultural change and development than it took to get from the Dickensian world of the early industrial revolution to the advanced industrial democracies of the age of Peak Blue. That’s the job that the Millennials face; they are one of the special generations in human history that must build a new world. It’s a high fate and in some ways a hard one, but it also gives a full scope to their powers of creativity and originality.
What's missing in this brief essay is any acknowledgment of the role of entrepreneurs and incentives in achieving the goals Mead describes. At this moment in time we are in the grasp of big government intervention in free market capitalism. Government intervention has caused capitalism to malfunction. Manipulation of the currency, overregulation, and political corruption have led directly to crony capitalism. Then artificial booms and busts created by this government intervention have confused the pricing mechanism resulting in chronic malinvestments by entrepreneurs and the resultant booms and busts and uncertainty. Mead seems to think there is some solution to all this that the Millennials will find and make happen, but he does not offer a clue how this will happen. It will happen but only if the central planning interventionists get out of the way and the free market is allowed to work its magic through the imagination and drive of the entrepreneurial class. It is this class that gave us the Industrial Revolution and all the attendant inventions that brought us to the magical world of jet travel and the digital wonderland of the internet. AND HERE'S A SEQUEL TO ABOVE: http://pjmedia.com/eddriscoll/2011/10/17/welcome-back-my-friends-to-the-malaise-that-never-ends/ The more things change the more they stay the same.
MORE ON PRESIDENTIAL LEADERSHIP:
President Barack Obama is ending his fifth year in office with the lowest approval ratings at this point in the presidency since President Richard Nixon, according to a new Washington Post/ABC poll released Tuesday.
Obama’s approval rating in the poll stands at 43%. By comparison, President George W. Bush had a 47% approval rating at the end of the fifth year of his presidency. And all other Post-World War II presidents had approval ratings above 50% — with the exception of Nixon, who, amid the Watergate scandal, had a dreadful 29% approval rating.
The brutal numbers underscore what has been something of a lost year for the President. His approval ratings have been plunging recently as a result of the botched implementation of the Affordable Care Act. In the Washington Post/ABC poll, only 34% approve of how Obama is handling his signature health law’s implementation.
Presumably, the return of Richard Nixon should make many on the left happy*. Back in September of 2009, Nick Gillespie spotted Paul Krugman longing for the 37th president, when Krugman titled an article with the three scariest words to emerge from a Timesman: “Missing Richard Nixon.” After first outlining how badly divided the country was post-1968, when the left had begun their long descent into perma-malaise, Gillespie wrote in response:
The proximate cause of Krugman’s Nixostalgia is the current health-care reform debate, during which various voters and officials have, my god, expressed discontent with both the status quo and proposed reforms (as vague as they are, and will almost certainly continue to be even after Barack Obama’s speech next week). To Krugman that represents the ascent of corporate influence and “the right-wing fringe” (which despite being powerless is somehow holding a Democratic Congress in thrall). It has deranged him at least as much as the electoral success of George W. Bush, which is to say Kruman now needs a rubber room the size of airplane hangar just to keep from bouncing off the walls. Yes, there is something really rotten to the core with a country that actively debates a massively important issue that may well define quality of life and economic vitality for, I don’t know, the next generation or two. What are we thinking, people? Shouldn’t we rush through whatever plan Krugman, or Steny Hoyer, or Ted Kennedy, or Bob Dole, or some other grand vizier, says is all good? For god’s sake, alternative proposals for actual reform, such as Whole Foods CEO John Mackey’s real-world plan, are just getting in the way.
Of course, Krugman wasn’t the only employee of the Gray Lady who had newfound approval of Nixon’s Johnson-esque love of Leviathan government — in the early 1990s, veteran Timesman Thomas Wicker wrote One of Us : Richard Nixon and the American Dream. And the Chicago Sun-Times’Roger Ebert longed for Nixon in late 2008, in his review of the Ron Howard film version of Frost/Nixon, as part of his long descent in the last decade of his life from family-friendly film critic to raving moonbat leftie.
At the start of a meeting with tech industry CEOs on NSA surveillance, Obama quipped “I’m just wondering if [Netflix CEO Reed Hastings] brought advance copies of House of Cards,” according to a pool video camera in the room.
As the CEOs laughed and joked that Obama should make a cameo appearance in the series, the president continued to praise the series, which revolves around a power-hungry House Majority Whip played by actor Kevin Spacey.
“I wish things were that ruthlessly efficient,” Obama said in his first public remarks on the show. “It’s true. It’s like Kevin Spacey, man this guy’s getting a lot of stuff done.”
Well, you got what you wished for Paul, Tom, and Roger. You too, Barry. To paraphrase Oscar Wilde on the effects of alcohol, we’ve made an important discovery: Nixonian policies, taken in sufficient quantities, produce all of the effects of Nixonian poll numbers.
And with three more years to go, I’m sure Mr. Obama can drag those poll numbers — and the rest of the country — down even further. Forward!
* Curiously many on the left aren’t very happy to see the return of the 37th president: “Pew: Liberal support for Obama at all-time low, worse than George W. Bush and conservatives.”
