What We Learn When We Learn Economics

I appreciate Mr. Hayes’s intellectually stimulating article here. There are
other schools besides Chicago across the political spectrum.
On the social democratic side you have Paul Samuelson, John Kenneth
Galbraith, Robert Heilbronner and Robert Kuttner. Kuttner’s 1998
book, Everything For Sale, is excellent in debunking the markets cure
all ideology outlined in the above article.
On the Right you have Murray N. Rothbard’s anarcho-capitalism, promoted by the Ludwig Von Mises Institute, they are total libertarians
and advocate the privatization of everything including police, defense,
jails, courts, lighthouses, roads, schools, etc.  They are nothing if not
consistent ! And they are a refreshing contrast to the hypocritical Know
Nothing Big Gov Neocons who frequently post here and on restroom walls.
There are the Ayn Randians who believe in army, courts, jails, police
and nuking all Arabs, so-called limited gov types. No thanks !
Actually everything including government and the market is limited.
Then we the collectivist but anti-central planning folks at Z-----Michael
Albert’s PARECON, totally nonmarket. Murray Bookchin’s eco-anarchism, leftist anarchism, municipal ownership of the means of
production, I’m very sympatico here. Except I don’t want the city of Oakland running anything, here I’m a Rothbardite.

Though my MA was in Political Science from the UW-Madison, I took many economics courses. Non-were tradtional macro-economics which I learned “on the fly” by development economics, labor economics, and agricultural economics all of which is based on the principles of macro-economic principles. There is an excellent book which I’ve yet to finish call Debunking Economics by Steven Keene. He takes the basic rationality utilitarian ideas behind neoclassical economics and debunks them. There is no real connection between wage levels and labor productivity. This is true especially now during the ongoing jobless recovery. Supply doesn’t create its own demand. Says law is thus out the window. Of course as JM Keynes proved, lowered interest rates don’t lead to increased investment. For over half a century the government has had to step in to stimulate the economy and of course business cycles are not self-balancing. A deep slump can go on for years. The recovery from the 1979-1982 slump wasn’t stimulated by the Reagan tax cuts, which Paul Krugman proved experienced a rate of growth similar to that from 1969 to the 1979 recession, but was stimulated by (a) massive military spending and (b) massive foreign capital inflows attracted by high interest rates. This was indeed a Keynesian form of pump priming which has been the strategy ever since FDR’s New Deal back in the 1930s. Finally, employment threasholds change so that more and more growth can be achieved with similar levels of employment due to new and dynamic technological inputs. However, this in conjunction with globalization of manufacturing production has lead to great increases in worker productivity in the US without any corresponding growth in income levels of the median and below strata. Again this is also because job growth in an age of lean production keeps unemployment high enough to suppress wage levels that would normally rise. One also notices low levels of investment with increasing levels of liquidity and very low savings due to imports and deficits. Global capitalism is to complex for formulaic trascendental theories and is shown over and over again to be an Historic System whose “laws” change with time over many different epochs of history. In the 1970s, economists were confounded by the debunking of the Phillips Curve and the existence of stagflation. Economics keeps getting more complex and confusing.

One of the most honest comments I have read by an economist was that the market is not moral.

“The fact is, a free-market system is blind.  All the market was designed to do was to provide the most output at the least cost. It will distribute goods and services in an economically efficient manner. It is important to emphasize that this does not necessarily mean it will distribute these goods and services in a socially desirable way.” (Robert Goodman, “Independently Wealthy” pg. 4)

A key word here is necessarily. Becoming rich is largely a matter of intellect, while moral behavior is a function of character.

Those who believe in a managed economy deal in theory but treat it like science. Science sets specific parameters — at standard temperature and pressure — control groups, etc.

However, economics only works in theory due to the infinite number of uncontrolable variables involved. A policy may seem reasonable between two trading partners if playing only with numbers, but this is never the case for long.

Factors such as individual preferences, language barriers, religious differences, social customs and traditions, unscrupulously selfish people, national political agendas introduce too many uncontrolled conditions. It is like playing poker with more than half the deck as wild cards.

Nearly all the popular “experts” we hear from do have a dog in the fight — he is hiding behind clichés like, “A rising tide lifts all boats.”
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Cabdriver and BlondeMike,
Some interesting comments and references here to look into.
Thanks

“WTO officials, mainstream economists and the New York Times Thomas Friedman ignored the fact that in much of the world neoclassical reforms had failed to produce the promised growth.”

This is one of those un-refutable statements that tarnishes people for no reason.

What was the “promised growth?” What was the actual growth?  What were these “neoclassical reforms” which were actually implemented?

Last time I looked, the only Latin America country rated as “Economically Free” by the Economic Freedom of the World Index was Chile, the country with the highest GDP per capita in Latin America, and had 6.1% GDP growth in 2004-2005.

Recent research (Dollar and Kraay, 2001) studied the experiences of a group of developing countries that have significantly opened up to international trade during the past two decades.  Per capita GDP growth in the post-1980 globalizers accelerated from 2.9% a year in the 1970s to 3.5% in the 1980s and 5.0% in the 1990s. 

The nonglobalizing developing countries did much worse than the globalizers, with the former’s annual growth rates falling from highs of 3.3% during the 1970s to only 1.4% during the 1990s.

[David Dollar and Aart Kraay, 2001, “Trade, Growth, and Poverty,” World Bank Policy Research Department Working Paper No. 2615]

In China and India, neoclassical market reforms have lead to growth rates of near 10% and bringing over 100 million people out of absolute poverty.

One economist who may be getting more attention in Europe than in the U.S.—not that there’s anything necessarily wrong with that—is Friedrich List.  Generally in this country (based on having just skimmed some on-line bios) he seems to be branded as a “nationalist” economist, implying perhaps that he a proto-Communist, or even a proto-fascist.  I hjave not taken the time to read a copy of his two majhor works _The_Natural_System_of_Political_Economy_ and _The_National_System_of_Political_Economy_, so I can’t really comment directly.

James Fallows had an article published in the _Atlantic_Monthly in 1993, in which he “discovers” Friedrich List (I remember the title as “How the World Works"), so this might be a good intro also.

Ironically, List seems to have taken much of his inspiration from how the American economy was being “run” in the early 1800s—a time that many modern economists (or perhaps only neocons posing as economists) consider the free-market Golden Age.

Thanks, Chicago Cab Driver and WTH, for the references. I will definitely look them up. Just had a brief exchange on the web with George Reisman, author of the atlas-sized 1,000 page treatise,
Capitalism. He’s a pure marketeer fanatic a la Ayn Rand and the
Austrian School of Mises and Rothbard. He had some nonsense
on his website about how globalization will really work in the long
run (as Keynes noted we’ll all be dead then) and he was furious with critics on the Right like Buchanan & Paul Craig Roberts. Buchanan actually did a book critiquing unfettered free trade a while back, I think it is called The Great Betrayal, and he showed how US infant industry developed because of tariffs and not that free trade advice we so
glibly champion to developing countries via the IMF & World Bank, WTO,
etc. You don’t have to subscribe to Buchanan’s many other highly noxious views to appreciate this work. Up until Wilson the tariff was
the main source of Federal revenue. Buchanan is big on Frederick
List, referenced by Tallen above. I may be slightly misspelling List’s
first name, it’s a German version of Frederick.
MREC has some very selective stats cited above, over 40% of Chile
has sunk into deep poverty due to neoliberalism and the government
is forced to reverse the privatization of social security because it has
been such a fiasco. While there are a couple hundred million in India
and China that have benefitted so far, there are literally TWO BILLION
in both countries who are in worse poverty than ever.
The 10% growth rate is not sustainable in either country and is wrecking havoc with the environmental, it is now one of the principal
causes of global warming as anyone with a working brain could have
predicted.
WTH, the pure market believers also treat their theory as a science.
They have an uncontrollable arrogance that reminds me of the Marxists
and former believers in central planning 40 years ago. Everything about
their system is perfect ! It’s only government intervention that causes the
problems ! Well I wonder WHY capitalism has produced such demand
for intervention.
Tom Frank had a devastating review of one of Thomas Friedman’s crazed tomes celebrating the market a few years back in Harper’s.
Worh looking up.

Just legally downloaded Dean Baker’s The Conservative Nanny State
published by the Center For Economic and Policy Research in DC,
Thom Hartman recommended it on his website, only 119 pages.
Looks worthwhile.

Interesting article especially last paragraph. I do agree that a little economics especially intro to Macro and Micro doesn’t give you the best understanding of this very complex field. Only with further study can the complexities of the fields be revealed especially the debunking of all the assumptions.  Moreover the intro to macro and micro seems to take Labor and Nature/Land for granted which has gotten us in a lot of trouble. A course in Ecological Economics (such as Herman Daly’s class at UMD) can really make you look at economics with totally different lenses. I highly recommend the class and his writings.

Chicago Cab Driver, just ordered Debunking Economics by Steven Keen (correct spelling) looks very interesting. Also just downloaded
a 114 page paper he did on Marx from his debunkingeconomics site.
Appreciate your bringing him to our attention.

blondemike,

“He had some nonsense on his website about how globalization will really work in the long run (as Keynes noted we’ll all be dead then)...”

I have a very good friend who majored in economics at University of Wisconsin on the GI Bill and is totally a disciple of of Milton Friedman. He and I were both self employed small business owners with quite different markets. Nick is usually a “half-full” kind of guy while I tend toward the “half empty” view.

His business was benefiting from cheaper foreign products while my clients were cutting budgets because of them.

He retired by choice at age 75. I was retired at age 67 when my last client shifted operations to China. In 1952 (our city centennial) the celebration was sponsored by 35 local manufacturing companies. I looked over the list this weekend — three are still here, but only one is still locally owned. I did work for nearly all of them at one time or another either directly or through an agency.

He gave me his usual “in the long run” argument applied to globalization. I sent him a cartoon with two Russians facing a communist firing squad. Caption: “Don’t worry, Ivan, in seventy years they will see that we were right.”

blondemike,

It seems to be a human tendency to try to make an example of something into a doctrine or formula. Religions, societies, political parties — usually start with one or more primary themes to which enough subscribe to be able to coerce others to allow.

I can see merit in Milton Friedman and Thomas Friedman to a degree—also Keenes and Galbraith, but theory is seldom a universal truth.  I like this from Albert Einstein. “In theory, theory and practice are the same. In practice they are different.”

There are times when tax cuts for the well off are best (They save and invest which adds jobs.) and times when tax cuts for the low income are best (They can’t afford to save which puts money into the system.) The necessary ingredient is the wisdom to know which and when.

The latest tax cuts went/are going to the wealthy and are supposed to create jobs.  The American Jobs Creation Act of 2004 is advertised as such.
The problem is this: There is NO specification the companies benefiting must create those jobs in America. There are several reasons NOT to do so.

1. A cut in payroll immediately shows in the bottom line.
2. The stock price benefits by the cut.
3. The management receives stock options.
4. Corporations contributed to political campaigns and PACs and in return congress passes tax legislation which favors them.
So much for free market theory and non-intervention.
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It has been my experience in working on dozens of corporate financial reports that CEOs are mostly true believers in the textbook econ theories.

Most are not bad people at heart and many actually make large contributions to their community. But they cannot begin to comprehend what life is like for their lowest paid employees.

A few years ago I was in a meeting with the company financial VP and the corp. secretary. The CEO, who was to make a presentation to the employees that afternoon) poked his head in the door and said, “I just checked and we’ve added over 300 employees since last year. That ought to set their minds at ease.” (People had expressed concern about losing their jobs.)

He went on and I asked the other officers, “Does that include the people from the two companies in Michigan you just bought?”

It did and they had cut about half of those employees.

WTH, that’s quite a story about the CEO wondering about the jobs, made me laugh. But the other story about how they make large contributions gives me thought.

I’ve heard this before and have always wondered that in a democracy where really were the voters or citizens in making decisions about where to make those contributions? Further, where were the workers in those companies as to their choice of contributions? After all, couldn’t they have been paid more thus reducing the contributions of the CEO/top execs but increasing the contributions of the mass of workers? It comes down to what I find most odd about corporations in America, they are basically undemocratic.

Sure, there is the argument that stockholders are the democracy within a corporation, but most stockholders never vote at shareholder meetings much less even show up. The largest shareholders wield whatever power among stockholders. As well, most stockholders really have stock temporarily in 401Ks or IRAs where the stock is really managed by the stock fund managers.

In contrast, if our voting system worked that way, people would be buying and selling votes, trying to accumulate the most in order to control elections.

Certainly in a corporation the mass workers have no vote, no say in who runs the company or what business strategy to pursue. Even a corporation with a union given a smidgen of power, there is no thought to actually having a in-corporation election of the CEO or president or in having a say in how much to pay them. 

I see corporations as more similar to Soviet style communism than democracy.  You have your premier (the CEO) and your politburo (board of directors) that usually just give a blank check to that CEO unless once in awhile driven to overthrow the CEO in a coup (fired) and install a different premier. Meanwhile the vast majority of the workers in the corporation (regular communist party members) have nothing to say about those in charge and if they do say anything too loudly (rock the boat) they will be laidoff/fired (ousted from the party). The workers have to deal with far more rules and regulations (communist red tape) while the bigwigs luxuriate with the stock options, the free healthcare, the huge bonuses, and parachute pensions (the Cuban cigars, top brand vodka and Russian furs).

Where I work, we now have video cameras watching us (ostensibly for our safety) and every time I glance at one I wonder who’s watching the top execs? Others have their computer keystrokes monitored as well as any phone work (for quality is the excuse) and one wonders if those at the top suffer such spying. It all sounds like what communist Russia would be like in the 21st century if they hadn’t collapsed. Although it sounds like Putin has maintained a certain element of repression and secret monitoring of those below him.

Now I’m not saying corporations are replicas of the old Soviet government, but it’s hard for me not to see an eerie similarity in their structure. And it bothers me that in a democracy our most powerful business institution the corporation is so undemocratic...And don’t even get me started about mission statements and corporate sloganeering (communist propaganda).

Jon B,

“WTH, that’s quite a story about the CEO wondering about the jobs...”
In 2004, the 100th anniversary of the company, they moved out of town and some of those same people DID lose their jobs.

I suppose it is possible that if the top guys made less other employees could give more, but I was only thinking of the truly big contributions which are mostly trust funds which were set up by the founders and usually before the companies went public.

Contributions to local charities such as United Way travel with corporate headquarters and this has become a big problem here. If a company is swallowed by a buyout it probably just evaporates.

If a company is privately owned I don’t see democracy as an issue. It’s their money at risk and is creating a place for people to work. But I worked with some of the second generation family owned companies where they really cared much more about their employees and treated them as an extended family. In return they had loyal people who pulled together and a long term relationship spanning generations was not unusual. It was later when stock was being pushed that it began to be more impersonal and cut throat.

Except for the donations issue I see no reason why employees should have a role in decision making. You are hired to do a task and that’s all, but a shareholder is theoretically a fractional owner. In theory ONLY since they have no clout. As you pointed out the majority shares are held by funds who usually cater to the CEOs’ wishes.

Now your description seems pretty close to the norm in my most recent experience. The pay gap is widening, benefits and perks for the top and squeeze at the bottom.

My father worked only two jobs in his lifetime — one lasted 19 years including the depression era and was a typical owner operated company. The other (beginning in 1940) was at a company which had a corporate partnership where all workers were members and while hourly pay was below many local companies there were bonuses paid each spring and fall as profit sharing.

The company avoided any union threat by seeing to it the employee/members had better overall benefits and pay than anyone else for comparable jobs.

It no longer operates that way. As the original management died off it became like any other job. They had gone nearly forty years with no layoffs — that changed in the 1980s.

Fascinating article.

I enjoyed the transition between the first half , when the students were enjoying the explanation of the ‘well-oiled machine’ , understanding the WSJ at last, and later on when Allan Sanderson went into his Adam Smith ( “almost like--- Propaganda” ) spiel on Free Trade, and they revolted.

I’m in regular contact with a young man beginning economics, and seeing him going through this learning phase. All Classical stuff so far !

Adam Smith wrote in the mid 19th Century, so no shame on him for not forseeing the recent developments in the derivatives markets, and much else. He did warn very seriously against allowing the capitalists to make the laws, as they would SURELY do that to their own advantage.

Commonsense.

If I understand blondemike correctly, he’s sympathetic to the new ideas, but horrified at the wastefulness specifically in the City of Oakland. I guess all of us are amazed at the wastefulness of so much of our ‘government’, local and central, but I for one do NOT see the answer as universal privatisation. We can be cleverer than that ?
( rereading, I see mike and I agree competely on india, etc .....the facts are there in the peasant farmers’ suicide rates. )
And YES ! I also see a great ideological similarity between the True Believers, whether oldfashioned mostly-dead Marxists or the predominate New Model ‘laissez- faire’ variety.

Cabbie points out that the old relationship between productivity and wages has disappeared. The reason for this is simple enough. Capital has no boundaries, and between getting 10% in france and 20% in China, it moves. No matter that the capital in question may well be the pension fund of the frog, or american, worker/salaryman. No matter that much investment there actually gets ‘robbed’. The perps get their megasalaries and move on…

Heck—if becoming rich were a measure of intellect, you would be, as would many of our non-rich net-friends !

Like ‘intelligence’, intellect gets muddled up with other variables in our lives, and their are different varieties of both.

In a ‘closed’ economy i’m sure that tax-cuts for the rich ‘could sometimes ‘ be useful................ but see above for movements of capital.

mjidavis ---- Herman Daly is a good guy .  Factories polluting downstream can be ‘profitable’, but Society often pays far more in the end--- so let us get more clever ?

Gabriel Kolko has a look at economics, the financial derivatives market, and geo-strategy,

Back to the article . Seems to me the author saw this as an exercise in indoctrination ?

Hi Frog,

In no way did I mean to imply that only intellect is the only way to riches or a guaranty of wealth. (It’s not just the cream which floats:-) While intelligence has often been a key factor perhaps “cunning” has become more universal.

You said, “Capital has no boundaries” to which I would add “other than those we impose.” Isn’t the realistic imposition of such what we expect from our governments? Tariffs or other taxes were been quite common before international corporations with no allegiance to anything other than greed became the norm. Too little regulation is as bad as too much and so it requires continuous monitoring.

I can see no reason to believe economic anarchy is a good approach, but in the end whatever the rules a truly free market exists through barter or black market. Our War on Drugs is an example of one that has become a sick joke.

Personally my barber and in I are a totally free market. His business has been falling steadily as our local economy has faded. We’ve known each other for thirty years and as two self-employeds has often commiserated about the governments duplicity and stupidity. I used to do occasional projects for him — business cards, ads for the phone book, mailers, etc. For a few years now we have exchanged our talents rather than use money. (With the little hair I have it is debatable who is getting the best of the deal.)

I maintain self employment is the best teacher of economics. Long before I ever read a textbook on the subject I realized some services were better for me to purchase (comparative advantage), the only way to earn more was to be better than the competition and/or faster (value//productivity) and if you take a day off it costs someone (me).

Yesterday another local company moved their headquarters out of town. They were founded here in 1870. My father worked there for nearly thirty years and they were one of my best clients for fifteen years. Past experience has shown the pattern to be moving the execs out of reach, cut jobs a little at a first, move a portion to a foreign cheap labor area, close the rest.

I’m beginning to think I was wrong when I said the theories wouldn’t work because there is no “closed economy.” It may be closed after all with only the powerful inside.

I’ll check out your reference to Gabriel Kolko, thanks.

We’re getting a lot of snow today — about six inches so far — twelve predicted. It’s beautiful out there!

WhatTH..

I was only comparing the Soviet political system with corporations which are not private companies. Private companies could be compared to dictatorships.

I’ve worked for all types. My first, a private family owned company which I liked but unfortunately didn’t pay top dollar, but it was more fun to work for. I’ve worked for several private companies and for several corporations. One of those private companies was bought up by a corporation and you could just feel the tension grow incrementally month by month over the few years after I was there past that buy-out.

Most private companies are usually owned by a person who has a sense of pride for what he (most often he) has made (and that’s another key, building a company from nothing). As well most owners care about the workers on individual levels. They may not be able to pay the best rates but try other methods to attract employees. Corporations on the other hand rarely are even headquartered where most of their factories or stores are located and think of pay and benefits as nothing more than an auction against the other players in the same business, bidding just a touch higher than the other and that’s only when employment levels are high. When unemployment is high then the bidding slides downward.

But even so, ownerships are dictatorships, and corporations are Soviet structured. Now that doesn’t mean all dictators are evil and mean and that some corporations try not to be like the Soviets. But the fact remains that the vast quantity of American economic institutions are not democratic in a country that is supposed to be democracy (I have problems with American democracy, but that’s a huge other story). I consider that sort of paradoxical. There are democratic economic institutions here, they are called co-opts. I’ve never worked for one, mostly because they are hard to find. I’ve heard that workers in co-opts are fairly happy with them, with the ability to share in all the decisions, excepting personality types who want to run everything and don’t want to cede to a group decision.

WTH, I’ve been out the last couple of days so just reading your recent comments now. They seem reasonable on the surface. i’ll get back to you here if I have anything to add.

Jon B,

My only personal experience was for three of small privately owned companies — two were family owned — grocery after school and one year between my two years at college. The first was only for a year — they paid less than minimum wage $0.70 vs $0.75/hr.  The second was in their ad dept. They shut it down and I worked an arrangement with them to work on contract — my first self employment at age 19.

The other one I suppose you could compare to a dictatorship, a graphic art studio owned by a guy who was very knowledgeable in areas I needed to learn, but I see it more like the relationship between a customer (the owner) and a service provider (me). 

He was also dogmatic and definitely was the Boss. I remember a job I was working on and suggested a printing technique he’d never heard of and said could not be done. I had some small press experience and had done it.  I showed him a sample in my file.  His reply, “When you work for me you do what I say and that’s the end of it.”

I figured OK, you pay me to do what you want and I stayed one more year before starting my own business. I learned all I need to know, made some personal contacts and later charged him by going rate for my work which more than tripled when I quit.

The biggest difference between any business arrangement and a dictatorship is the freedom to leave if conditions are unsuitable to either party.

However, for thirty years I couldn’t understand why most people who worked for someone else were so obviously willing to put up with arrogant, rude or exploitive people. Then globalization came on the scene, my clients began to evaporate and as price became the ONLY important criteria my competition became the boss’s secretary, or in one case, his 12 year-old daughter who learned to use a computer and clip art.

I had been more fortunate than I realized for all that time and used to think (and I know at least once said), “Why don’t you just tell him to shove it and get a better class of client?” I am ashamed of MY arrogance and ignorance. I learned that if you have personal responsibilities beyond your comfort level — health problems, kids in college, or whatever, you may NEED work even from the worst bastard to get by.

The best lessons are learned the hard way.

Frog,

I read the Kolko article and found it to be insightful. His assessments of both the global economic woes and the Iraq situation are well thought out and well presented.

Near the end are four words of wisdom which I would like to hear from our “leaders” and “deciders” — “We simply cannot know.”

For some time I have been aware how often top level corporate management begin to believe they are infallible. People are too quick to defer to the guy who writes their paychecks and he sees this as agreement with him. Many execs know so little about the lives of ordinary people there is a pathetic disconnect.

The same holds true for politics and government.

In the U.S. we have an administration almost entirely made up of former CEOs. Add a man on a mission from God to the mix and they are convinced their master plan is not only the right one, it’s the ONLY one.

I see the same arrogance among the financial “experts” here as I saw in Secretary of Defense Rumsfeld. It is in the news every day.

They say raising the minimum wage is BAD for the economy, but raising CEOs’ pay and stock options is GOOD for the economy. As the American consumer loses his job through globalization they say he is benefiting from the low cost imports. Two-thirds of our economy is dependent on the consumer who is losing job quality and is adding record debt. Try to maintain a country on that strategy. If a rising tide lifts all boats they should consider what happens when the tide goes out.

“As workers lose jobs in one niche or sector, they gain in another, moving on to better jobs and higher pay.” (Bull shit from a group of economists in an article at the Wall Street Journal website last week)

Change for the Better —The case for economic turbulence.
http://www.opinionjournal.com/la/?id=110009316

While I find it encouraging that globally more financial leaders are concerned as are some of ours, I have little hope they or anyone will be able to get the rampant greed under control. Even if there were an international consensus on how to handle it — there is no way to get voluntary restraints or any way to force compliance. The cross border corporate collusion is too great.

Kolko uses the phrase, “… the United States is strategically weak...” in describing the three military adventures we’ve lost. I see the same with the economic fiasco about to bubble over.

In either case well meaning people who believe they know what to do, along with opportunists who know what they want and how to get it, can get us involved in events which can outlast the nation’s resolve.

That reminds me of a line by Keynes, “The market can remain irrational longer than you can remain solvent.”

A fitting epitaph for individuals and nations following the twins — Money and Power.

Economics is about scarcity, choice—and muscle—which for labor means unions.  Unions are much more critical to labor’s wellbeing than any government intervention in free markets—which intervention wont take place anyway in a mostly unionless economy like the USA’s has become.  You could almost say that unions are the market (as in libertarian) answer to economic inequality—as far as that goes which is about half way.

In 50 years the Chinese will be living as well as Americans today—to be more precise Chinese output per person will match America’s today.  If the Chinese don’t figure out the central role of unions in economic democracy they may end up living as badly as American workers do today.

German style, mandatory sector-wide labor agreements are the only fool proof unionizing model that I know of.

Denis Drew
former cab driver from Chicago :-)
ddrew2u@sbcglobal.net

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Frog,

I went to amazon.com to read reviews of Kolko’s book, “Another Century of War?”

(I’m only going from his article, a single professional reviewer and a few reader reviews, so this is in no way a critique of his book.)

Amazon reviewer — “Another Century of War? insists that the roots of terrorism lie in America’s own cynical policies in the Middle East and Afghanistan, a half-century of realpolitik justified by crusades for oil and against communism. The latter threat has disappeared, but America has become even more ambitious in its imperialist adventures and, as the recent crisis proves, even less secure.”

WTH — I would broaden his diagnosis to include others in the western world beginning with WW1… Unsolicited intervention and poor decisions compounded through the years.

This may well be the “roots of terrorism” yet, as with the smoking/lung cancer connection there is little chance of a “cure.” If we could kick the habit a long term change may be in store, but what politician ever thinks past the next election? The reality is every country, political or religious faction is able to find a justification to incite popular support to suit its own ends.

Kolko may well point out how the Japanese need for oil played a large part in their attacks on the western nations’ colonies under the guise of the “Asian co-prosperity sphere.”

You had mentioned the U.S. failed wars as, Korea, Viet Nam and now Iraq.

I remember June 1950 when we went into Korea to save the South from the North — not much oil there, but the domino theory of communist takeover put a lot of inexperienced U.S. troops in hell. It was fear of China which convinced the politicians to hold back on winning and settle for a half century truce. We didn’t nuke them and now they are a nuclear threat.

There is a saying that Sam Colt’s revolver made ment equal — now it’s Uncle Sam’s nukes which makes the little guy equal.

Oil will, by imminent necessity, continue to be a driving force in foreign policy regardless of who is in the White House. Power hungry people whether radical Muslims or former KGB chiefs can manage a willing media to further stir the pot.

Amazon reviewer — Raising the same hard-hitting questions that made his Century of War a “crucial” (Globe and Mail) assessment of our age of conflict, Kolko asks whether the wars of the future will end differently from those in our past.”

WTH — If different, it will probably not be an improvement. Since so many groups have them it will likely involve nuclear weapons in one form or another this time. Mutually assured destruction is no longer a deterrent we can depend upon.

Sadly, if we pull out of Iraq with anything less than Iraqis governing themselves (one country or three — similar to the former Yugoslavia) another Saddam style bloodbath is likely.  But I doubt the isolationist murmurings will change much — I have been hearing some of the same people who want us to leave Iraq saying, “Bush must stop the killing in Darfur.”

I heard a young Tutsi woman on TV last night telling about hiding with six other women in a three foot by four foot bathroom for 91 days before they were able to get to a French camp for protection.

It’s a pretty safe bet that this century like all centuries will continue to make war a universal pass time.

Hi Heck an Cabby

Losing posts at mom, this to check....

EDIT ....at last.

What Joe Stiglitz has called the “ideological simplistic view on Free Trade” is promulgated particularly in intro economics, which is what most of the populace gets, if anything .  Its what the MSM flogs 24/7, too.

The WSJ article from heck is pure cloudcuckoo land.

“as workers lose jobs in one sector ...they move on to better jobs and higher pay “…

“growing buffers against risk .............”

Did a longer post but lost. lESSON LEARNED;

wth…

From your Dec. 3 post you wrote.."Kolko uses the phrase, “… the United States is strategically weak...” in describing the three military adventures we’ve lost. I see the same with the economic fiasco about to bubble over.

I agree but I’m curious are you thinking in terms of the reports recently about the slide in value of the dollar against the sterling and euro (not that this hasn’t been predicted in the last few years)?

It seems the dollar is in a pretty pickle, tween a rock and hard place which is foreign investment to steady our national debt and attractiveness of other currencies besides the dollar. The Bush administration is claiming they want a cheaper dollar in order to make our products more affordable in other countries, yet we’ve driven so much manufacturing out of the country it is hard to see what products we can attractively export anymore, excepting entertainment (which has the problem of piracy) and food. China floats its currency with ours, so I don’t see much hope of improving the trade deficit.

They say that when America gets a cold the rest of the world gets the flu, but I think that may be old thinking. I wonder if the euro is going to be the new currency of the world, more like I wonder when.

When looking at the decline of previous empires, some declines can be argued that the cause was economic. Empires can simply spend their way into decline. It’s what I believe we’ve set ourselves on a course for unless we start taking some drastic actions and even then it may not stave off the decline.

JON B
HERE’S A NICE ONE ON “""PROTECTIONISM “"”.

tongue very near cheek..............

Every time I hear some well-heeled safe-jobbed hypocrite lecturing us on “competitiveness”, I wanna reach for Heck’s .45 .

blondemike claims that Chile has a 40% poverty rate.

The truth is that Chile has the lowest poverty rate in Latin America, 18.7%, compared with Bolivia which has 64% poverty rate.

http://www.tcgnews.com/santiagotimes/index.php?nav=story&story_id=12402& ;topic_id=1

Total BS from your usual lying rightwing sources. UN and other more
objective agencies give AT LEAST 40% below the poverty level in Chile
since the “free market” reforms.
WSJ editorial page bears no relation to the facts.

blondemike claims: “UN and other more
objective agencies give AT LEAST 40% below the poverty level in Chile”

The UN Human Development Report 2004 says that the national poverty level in Chile from 1990-2003 was 17%.  Compare with Peru (49%) or Bolivia (62.7%).  Mexico’s national poverty level is less (10.1%) but you’ll see why.

Each country has different national poverty lines defined by their governments, so let’s compare rates of poverty on a fixed measure, the percent of people living on under $2 per day from 1990-2003.  In Chile, the rate is 9.6%.  Compare with Peru (37.7%), Bolivia (34.3%), or Mexico (26.3%).

Alternatively, one could look at the UN-defined Human Poverty Index (HPI-1) rate, which has Chile at 3.7%, Peru at 12%, Bolivia at 13.9%, Mexico at 8.4%.

The report goes on to call Chile an example “of a country that has converted high growth into rapid human development.”

Here is the link…
http://hdr.undp.org/reports/global/2005/

Frog…

I Read the “tongue in cheek” link. I had just had to shake my head at this go around I deciphered. From the article…

---Suppose that our trade agreements over the last quarter century had been designed to facilitate free trade among highly paid professionals. Specifically, these agreements would be about setting clear and transparent education and training standards that would allow bright kids in Mexico, China, and elsewhere to study to become doctors, lawyers, accountants, and ECONOMISTS in the United States.---

So we bring kids from Mexico, China, etc. here to study economics, which brings us to the original article “What We Learn When We Learn Economics” that we’ve been posting about which shows the Chicago School of Economics agenda. So are we to teach these bright foreign kids Chicago style economics to take back to their countries?

Still shaking my head and wondering if my tongue is in my cheek.

The UN records also show 40% poverty just in Santiago, the capital of
Chile. In the countryside it’s 60% or higher. Contrary to your figures
about 18% in Chile are doing quite well but many more are not.
In The Financial Times of London, 12-5-6 there is a piece by Chris Giles, the Economics Editor, that shows 2% of the planet holds 50%
of the world’s assets. Peddle your trickle down nonsense elsewhere.

Jon B, Frog,

Since no country’s currency has any intrinsic value, but is a matter of faith, I see more need to closely monitor every investment than ever before. Since gold and oil are still dollar denominated their volatility (all 3) makes life interesting. The Euro may very well replace the dollar before long.

In addition to outrageous government spending I see a number of huge economic strategic mistakes which could eventually drastically destabilize global markets. The shift in U.S. jobs which is turning us into a two tier standard of living — the super rich and the rest — is bound to kill our traditional economy.

If our economy is 2/3 reliant on consumer (over)spending…

If unemployment is in fact far higher than popularly reported… (long term comparisons are available for those who are willing to search at Census Bureau and Bureau of Labor Statistics web sites)

If job quality nationwide is comparable to those around my area…

If actual spendable income continues to fall…

If there are now 47 million people without health insurance…

Claims of shortages in such jobs as engineering and medical have raised the number of visa workers. This will discourage young people from taking on the debt associated with a college education while having to compete with the lowered salaries paid the foreign workers.

So we not only have excessive spending, but under earning as well. Not a good long term outlook.

U.S. economic strategy is designed to serve ONLY the elite at the expense of the middle an lower income earners.

History shows that the elite may enjoy themselves only until a violent event wakes them from their detachment from reality.
--------------------

Here’s something my dentist told me this morning. He says California is now offering a free education in dentistry to Hispanics who will then serve in the barrios where no growing wants to go. It looks like no occupation is without its threat.

Sounds a lot like the 2004 American Jobs Creation Act which gives tax breaks with no guaranty jobs created will be here. What if the new dentists decide to go where the money is? (And who wouldn’t?) Kind of tough to compete with a free education while paying off $thousands in tuition loans.

Doctors, lawyers and accountants are already losing out to India. If the people don’t come here we send the work over there. It is highly possible that if you have your income taxes done by a U.S. accounting firm it is at least partly being done in India. The basic legal research which used to be done be the kid with the new degree is being handled the same way.
:-(

wth…

Couldn’t agree with you more. You pointed this out..."if job quality nationwide is comparable to those around my area…”

Where I live, the Detroit metro area, is quickly changing job quality. Michigan once was the “Car Capital of the World”, I’d call it the “State of Confusion” now. Michigan every month vies for the highest unemployment in the country. We keep seeing wave after wave of buyouts (both white and blue collar) in the auto industry and so much of the economy was linked to building cars however peripheral. I was just talking to a friend whose husband is applying for a temporary auto line job. The buyouts are in effect trading experienced workers for inexperienced workers with much lower pay, no health benefits, and absolutely no job security. That statistic you mentioned about workers with health care will blip higher as the Big Three (I’ve been calling them the Little Two Plus since Chrysler was bought by Daimler) shift work to temporary workers.

For 11 years I worked for a supplier to the Big Three in quality control and I can state flat out that trading away experienced auto workers is a mistake for quality, these are products that are propelled at high rates of speed with humans in them after all. And don’t get me started about JIT (just in time production) that nudges quality down to meet shipments.

And boy do I hate the blame for the American auto industry’s woes on unions and specifically health care costs. Those health care benefits are something ALL workers in this country should have. They never complain about the top execs health care bonanza where everything is paid for or else their extreme salaries will cover what is lacking.

But their woes really come down to bad business decisions. For instance when gas prices were at three bucks last year, GM is announcing their bold plan to produce more SUVs. And it goes back decades when a guy named Dr. Deming came up with a way to improve quality with statistical process control (SPC) that he first took to the Big Three and they rejected him whereupon he pitched it to Japan with raves. Long story short---Japan eventually began building better cars and the Big Three had to play catch-up. When I left the auto industry (I saw the writing on the wall for the industry) GM was still trying to convert over to metric while every other company had done so.

If you want to see another mistake check out the documentary “Who Killed the Electric Car” about GMs decision to stop building the EV.

At any rate, no manufacturing industry has probably ever meant more to a state (Michigan) and a country (USA) than the auto industry. If there was ever an American industry that cries out for protectionism (with oversight) it’s the car builders. We let Japan and others come to America to build cars and sell them but the reverse isn’t true. There was nothing wrong with letting Japan sell cars in America, it did force improvement in American cars, but now the pendulum has shifted too far. We need to take a deep look into how to solve the auto manufacturing problems from top to bottom. Oil supply is going to be an ever increasing problem and the auto industry must be helped in the transition to something else (EVs would be a good choice) before they become nothing but a dinosaur industry.

Jon B,

I am familiar with most of what you mentioned — JIT, loss of manufacturing (especially auto related) firing of experienced workers, exec benefits and bad business decisions. Dr. Deming was here and I’ve read his Quality Circles literature. After the Japanese began to out do us at least one of my customers adopted his methods — they are still here, many others are not.

The bad decisions department is the reason for all the others.

Somewhere along about the 1970s corporations became enamored with the idea a guy with an MBA could run any business. Bringing in people from “the outside” who had new and imaginative ideas was the formula for success. There was no need to know specific products, processes or market.

My best clients were the first and second generation owners of companies. At a Christmas party this Monday I sat next to a man (Bill) who turned out to have worked for many years with my father-in-law. The shadow of the company is one of the few remaining manufacturing firms (fasteners) still here.

This fellow remembered Carl as “… a guy who could work magic on a header machine.” He said he was able to make the machine do jobs it was never designed to handle. Carl came to the U.S. from Sweden at age 19 with only four years of schooling. At ten he was literally “farmed out” as a hired hand because his family needed the money.

Bill was in middle management and was urged into retirement (leave now and keep your benefits) because of speaking against the company dumping the experience and therefore earning more.

They told him he had been there too long and was still thinking like the founders. His response, “They came here with nothing and built a business which has lasted 75 years, employed thousands of people and created hundreds of new products — they must have done something right. And you think you can do better?”

Across the country and now around the world the greedy have adopted the same approach toward people — Use them up and spit them out.
One of the many books I read in recent years on globalization quoted a CEO, “We see people as appliances. When we need them we pull them in. When we don’t, we just pull the plug.”

I live in Illinois and many of my customers were connected to the auto industry. Their machines made engine blocks, fasteners, hardware, clutches as well as other consumer items and aerospace parts.

A friend sent me an mail yesterday about Illinois debt and a possible bankruptcy. As a former manager of a state mental hospital his pension is on the line. Some of my friends retired from mfg companies have already experienced cuts in benefits and fear more to come.

So far Byron Dorgan of South Dakota is the only one in Washington who seems to understand the seriousness of the situation. My generation may be the last to have had it better than earlier ones.

WTH,,,

Again, I couldn’t agree with you more. Another aspect of the loss of manufacturing is the scrapping of long term experienced important niche workers. We are moving to a point where if somehow manufacturing trends are reversed and it expands again we will lack the experience to do it well again for awhile. It’s different than back in the 1940’s when we geared up for WWII, the processes are much more complicated.

Kevin Phillips wrote a book back in the 1990s called “Wealth and Democracy.” Mostly it was about the history of the United States and the divide between elite money and the rest of us. But in the later chapters, he discussed how the several “empires” before us had shifted manufacturing or craft trades out of the country prior to their dip as a country in economic dominance. Each country became the financial centers rather than the building countries. Going back Great Britain, The Netherlands and Spain all went through this shift.

And each country was supplanted by the next industrial nation as top empire. The United States for example surpassed Great Britain in manufacturing, some of it exported from England. The Netherlands allowed the craft trade to move to England, same as Spain to The Netherlands. Thus we see why this fear of China to supplant us as the economic dominant nation.

I suppose that maybe that’s not such a bad thing. With manufacturing we do get pollution and our country could use a breath of fresh air. And I wouldn’t mind if we weren’t top banana anymore. The bad thing is that dying empires tend to want to hold that title long past the time they have already fallen back, making bad decisions based on their old way of thinking. I can’t help but think that W. Bush is actually speeding up the process of our regression, making bad foreign policy decisions and wasting money at probably an unprecedented rate.

Now it could be said that Philips’ observation is theory, that other factors really led to the falling from top empire. He also pointed out the moneyed elite widening span with the lower classes in those other countries. But wars could also be part of the equation, wars cost money and countries can spend their way to their fall. But it does seem that those comparisons that he made from the past to our nation are deja vu all over again.

JonB

I posted the article, as a ‘spoof’, and thought I should mention the ‘tongue in cheek bit . Seems it was needed, not 100% sure you got the GOAK !

If EVER, anyone thought wars were a good way way of sorting out international problems, WELL send the Oldies into the front line, because they made the decision.

Imagining different futures are what we are all about. The south american kids who ‘learned “ Economics in the USA, have choices to make. As do we all..

Here in frogland, the same story. I have a friend with a very small precision engineering shop , working for the auto-industry. Recent news about 20000 (pretty local ) redundancies in that sector , I do not yet know if he will have to close his small factory.

My small example from my local friend is the same disease affecting my american friends.

Last week, the UN’s Secretary-General Kofi Annan told the BBC that he agreed with Iraqis who claim life in Iraq is worse than it was when Saddam was in power saying, “ . . . their kids could go to school and come back home without a mother or father worrying ‘am I going to see my child again?’”

Libertarian columnist Ilana Mercer in her article, “At least Saddam kept order,” has this to say, “To be fair, Saddam’s last major massacre was in 1991, during which only 3,000 Shiites were murdered,” adding, “That’s less than the monthly quota under ‘democracy.’”

So much for the geo-politicians and their New World Order.

I have made the same point around the net for a coupla years, and now everybody admits it.  Life might have been horrible, not ideal, !, under Saddam, but it was a fuckin sight better than now.

BUSHONOMICS is now tring its best to make sure that Iraqi OIL stays under American influence.

Watch that space ................................................................

Jon B, Frog,

“I can’t help but think that W. Bush is actually speeding up the process of our regression, making bad foreign policy decisions and wasting money at probably an unprecedented rate.”

Intelligence is not one of the adjectives which come to mind in the same sentence as “George Bush.” (either father or son) I tend to see W as programmable. Keeping it simple must be the family motto… “Stay the course, We’re in a war, The economy is good, Everybody wants to be free” and now, “Going forward.”

Unfortunately the alternative candidates were at least as dim, IMO.

More job cuts were announced this noon — CNBC, the perpetual cheerleaders for Wall Street, quickly pointed out that Chrysler and DuPont shares were up on the news — “...which, is good for investors.”

(I think I may begin to count how many times per hour someone on that channel states our economy is strong.)

Heck, John B, we are in that same boat.

Would-be factory workers in Mexico who lost their last job, to a guy somewhere else in Mexico who would work for less than him, peasant-farmers in India enthralled to the sellers of GMO seeds and the necessary fertilisers, my neighbour french farmers trapped on the same merrygoround of producing yet more more milk to be exported , free, to Africa, or somewhere.  With subsidies.

The so-called “intellectual arguments” supporting this crap are BOGUS.

Long ago , my UK sarge and Heck’s told us “ Bullshit Baffles Brains”.

Sorree ! Not true.

There are some very simple things that are evident to anyone, that the right to clean water is obvious.

And now today, most of French Water is owned by the Multinationals.

Frog,

I hope your friend’s business survives. One local small factory owner here was interviewed by a TV economics show host a couple years ago. He was told the company had done what it could to keep employees, but a few had to be let go even though the owner had not taken any salary for over two years.

“Well, even so, you must admit the tax cuts have been a big help, right?”

To which the owner explained, “If you are making NO PROFITS there is no tax to pay and therefore NO tax saving.”

------------

You pointed out that under Saddam although life was horrible, it was better than now. I ‘m certain you don’t believe we should reinstate Saddam, but setting aside the questions of why we are there and whether we should be — we are there— so, what would you suggest at this point?

My opinion in the given situation is: We need enough troops to establish the rule of law. Without law and enforcement nobody anywhere can live safely. As long as religious factions, criminal elements and war lords run rampant the fighting and bombing will continue. Not so?

From wth..."So far Byron Dorgan of South Dakota is the only one in Washington who seems to understand the seriousness of the situation. My generation may be the last to have had it better than earlier ones.”

This last election brought in a few more that understand the problems. New senators Sherrod Brown of Ohio, Bernie Sanders, VT are two. If you read the Wall Street Journal op-ed (and has been seen on the internet elsewhere) by the new Virginia senator Jim Webb’s scathing attack on the elite system in business, you have to say he probably understands. Jon Tester of Montana is probably a populist but more interested in farming issues.

Here’s Webb’s op-ed

http://www.truthout.org/docs_2006/112106J.shtml

Jon B,

Yes, you’re right.

Some time ago I saw Bernie Saunders and wrote to him with my thanks.
I am not familiar with Brown and Tester, but have read Webb’s WSJ piece and his book, “Born fighting.”

I hope the geographical spread of the people will be recognized in D.C. This economic deterioration is nation wide and not limited to the “Rust Belt” or “lower level jobs.”

As usual the people who have the least will feel it first and worst. It seems to be a universal truth — whether bad economic policy or economic sanctions — the top of the ladder never feels the effect before the lower end is drowning.

Guess where most of the “experts” are.

I hope those few representatives in our list can bring about enough change before we see a return of the 1960s in neighborhoods. Frustrations being vented in the wrong locations.

JonB

I’ve been following those same guys from this side of the pond, and Dorgan.  ralph nader describes some similar positive activity in this piece.

Between us we’ve seen around us the catastrophic effects in human and societal costs of the so-called Blabla “"free"” movement of capital and trade.

Hundreds of anecdotes may add up to just one big unprovable anecdote !

But .............I’m convinced that we have exchanged a moderately inefficient but socially stable world for something far worse. The eternal quest for higher productivity from hyper-mobile Capital is the cause.

Maybe my marxist friend cabby/denis will return.

In the meanwhile, we gotta define our Objective, identify the enemy as it were, and get organised.

If we don’t some sort of breakdown in society is on the horizon. It may be slow and unpleasant, or fast as in a Crash, I dunno.

Heck-- on Iraq I have no magic solution. Looks like the time is past for imposing the rule of law , without 300,000 troops, and nobody’s going to provide those;

For the complexities of invading and trying to transform a tribal society, check out Rory Stewart. Occupational Hazards --my time governing in Iraq.

“ but last week you were shooting at me ..... yes yes Rory Said… but nothing personal “”

Frog, wth..

Sherrod Brown moved from the House to the Senate. He’s so fair trade, he even attended as a protester at the Seattle WTO meeting back in 1999. You know the one with all the “rioting,” which caused the police chief to resign. The police chief is now promoting decriminalization of drugs.

Ralph Nader has long been a champion of the working class. He continues that work. Failing at three presidential races, he attempted to bring those issues to the country and probably opened at least a few eyes. Unfortunately he is not an elected official, so can’t be named as the others we have named.

Looking at the Senate there is certainly a group that might be referred to as “the economic populists.” The aforementioned Webb, Brown, Tester, Saunders, Dorgan and add in Kent Conrad (ND), Tom Harkin (Iowa), Dick Durbin (IL) and possibly newcomers Sheldon Whitehouse (RI) love that last name, a White House in the Senate, Bob Casey (PA) and Claire McCaskill (MO). All the newcomers used the economy disconnect for the working class as a campaign issue.

And now that the House is Democrat, we might see a change in the type of free trade agreements. CAFTA passed by two votes in the Republican House. That vote reflected some Republicans voting against it as well as nearly all Democrats, a far cry from NAFTA back in the Clinton years. I wouldn’t be surprised if CAFTA is revisited. I’m not a Democrat (independent but lean Green Party but I mostly vote as a realist in a two party system), but I can tell you I rejoiced at the breaking of the Republican lock in Washington.

WTH, where are you living ? What planet ? We CAUSED the chaos, we
cannot cure it, rule of law ????????????!!!!!!!!!!!!!!!!!!!!!!!!!!!!
The Military Commissions Act of 2006 repeals the Constitution, it’s
one of many things, Jose Padilla, Patriot Act, Signing Reservations,
illegal wiretapping that demonstrates Bush doesn’t respect the rule
of law here. You show yourself to be a John McCain type of rightist
extremist. I’m very disappointed.

Blondmike,

ibid (What we leave Behnd)

Omigod ! If it’s what we left behind in Vietnam we are to be deeply ashamed.

Jon B
“"revisiting “"” cafta nafta wto imf wb, EEC, e t c…

YUP, YOU BET,

lotsa revisiting to be done, and much of it comes back to those simple ideas in Econ 101 which were goin to solve all problems, eventually.

Protectionism is a dirty word . Weel to hell with it, I’m goin to start talking a little dirty in the runup to our presidentials .

PS Norm Stamper of LEAP ( law enforcement against prohibition) did an article here a while back. Most interesting example of fact that people can learn, change .

Frog,

In our fair city we have still a net loss of 15,000 manufacturing jobs even though there has been much ballyhoo about our recent “recovery.”

There is a plan about to be hatched to start a $20 million revitalization plan on a hockey stadium in the downtown area. The building was placed there 25 years ago to “revitalize the downtown area.” It has NEVER made a profit (wrong location) and has been on life support and costing an additional $900,000 per year from tax payers the entire time.

Yesterday a local downtown theater closed on what was to be the opening day of “Oliver”.  The paper this AM said no more theater, no ticket refunds.

The director said, “We attempted to raise additional funds from corporate donors, but when the economy has gone to hell, people have other priorities.”

This is the first open admission I have seen by anyone here that the loss of manufacturing companies has had a lasting negative effect.

The usual reports have been say they can’t find enough machine operators. They should say we can’t find qualified machinists willing to come back to work for the low wage we offer.

Too late to undo NAFTA, but if we prevent any more of this kind of trade deal it would be encouraging. Media reports of any good news are short term comparisons, “The best since 2000.” The really good times are so far back those now in office were in nappies.” (I have British friends.)

If our governments don’t believe in protecting their own what the hell are they good for?

Heck,

I must confess I do not master all the deets of NAFTA , but I have doubts about anything being too late to change.

If that were true, nothing would ever get changed ?

The russkis seem to have a clearer view of this, as Putin kicks out Shell from its majority participation in Sakhalin.  Any trade agreement which turns out not to be in the national interest depends in the end on ‘Power’.

The South American dictators ‘disappeared’ and tortured their opponents and many complete innocents too. They were fully supported by the US in that. Operation Condor. Kissinger said they voted the ‘wrong way’ in Chile, so we had 911 1973..

Now we are seeing Latin American countries denouncing “contracts” and getting increased percentages accruing to them.

The obvious answer is that some contracts are robbery, and so outright that everyone agrees on it . So it gets redrawn , and business continues.

Getting back to “Power”, the north american elites have sold out their own people , for their own enrichment, because they do not give a damn about their own people. Just as previously colonised or semi-colonised elites around the world did , and DO, for THEIR own people.

So north america, france and europe generally, and other prosperous places like Oz/NZ, have a lot in common with the poorer parts of this world. Far more than the vast majority of their rich peoples are yet ready to admit .

The “economic arguments “ sold to us bring me back to where we began. This article we are supposed to be discussing !

Entities such as the World Bank and IMF originated from WW2. American controlled, with noble aims none of which have been fulfilled. . The WTO is rather a mystery organisation for me, very biased against the poor countries for sure, so i wonder for fucksake why any more would want to join.

And I have to ask myself WHY they stay inside .

Slowly, argentina and others are paying off their IMF debt and getting out. Quite right.

An ideology is never more powerful than when governing people accept it as the whole truth, and guide their countries down its road.

This particular ideology has obviously attracted the Power Elite (C Wright Mills !) and intellectual fellow-travellers.

Your frog’s analysis of this is that a mishmash of intellectual theorising has coincided Oh so neatly with the interests of a tiny minority who are taking us all to the cle

Cleaners !

Here in Europe the “Free Market Theorisers” have mostly taken over the European Commission. Like the GOP with Bush in Congress.

Let the Polluters regulate Pollution . Great !

Let the Arms Manufacturers and AIPAC decide International policy. Really great !

Fortunately, all is not bad, as different parts of europe disagree—GMO’s are illegal here under European Law, but france has not yet passed it into french law .

SO, france has to pay , might have to pay eventually, 360000Euros a day for not passing those laws, while at the same time legally attacking friends of mine for destroying illegal plantings of GMO crops !

Our local senator has been working hand in glove with monsanto since the beef Hormone business 20yrs ago. Same man working for the GMO’s, same ‘employer’. .

I can forsee some nasty but true flyposting in next year’s elections.

Frog,

I believe it is too late to change back to what we had before NAFTA and any attempt to reverse will take far longer than it did to get where we are now. (I am using NAFTA as a proxy since it was our first official participation in globalization.)

My opinion revolves around what I have witnessed, what I have read and what people I know in various parts of the U.S. have related to me from their locations. While my experience is linked to manufacturing many others have seen similar effects in a wide range of occupations.

The local and area companies I worked with for forty plus years were developed over a long time. Several were here more than a century. I realize this is relatively short by European standards, but these companies were largely the products of first generation European immigrants who had been poor, survived the 1929 depression and were dedicated to the well being of their employees, took pride in the quality of their products and were extremely patriotic concerning their adopted country. They were not opposed to making money, but it was NOT the driving force it is today.

Few of these traits characterize today’s management.

Thankfulness outweighed greed. I asked one old Swede many years ago what his advice to me would be as I started my own business. He said, “Vell, all I know iss, yu find gud people to verk vit— people yu kin trust, do yer best verk and yu gotta take in more dollars den yu send out.”

“Entities such as the World Bank and IMF originated from WW2. American controlled, with noble aims none of which have been fulfilled. . The WTO is rather a mystery organisation for me, very biased against the poor countries for sure, so i wonder for fucksake why any more would want to join.
And I have to ask myself WHY they stay inside.”

I suspect most of the above falls into your assessment: “...this is that a mishmash of intellectual theorising has coincided Oh so neatly with the interests of a tiny minority...” and “...accept it as the whole truth, and guide their countries down its road.”

In contrast to the founders I mentioned in our city the “new economics” is a product of books espousing theories widely accepted as gospel. I have argued with a local Chief Financial Officer who was totally convinced what they do “for the shareholders” is good for everyone — their own employees, the nation and the workers of the emerging nations whose cheap labor they are now enjoying. He is happy to keep thinking that.

Many in public office are willing to accept the advice of “experts” (all trained in the same schools) which concur with the executives in total disagreement with my “imagination.”

With this entrenchment of thought it only takes a few clever and powerfully placed people to skew legislation and policies of an entire country. (Even some of them may believe this is a good thing.)

The free market IMO, is a fairy tale. Our economic operations are in the hands of people who think they can actually control the economy by money supply and other techniques. It is, I believe, as far from reality as the Soviet system which tried to do it by setting prices, production quotas, etc.

In general I would say the thing they disregard is the human element.

Numbers people are seldom adept at human relations. They like numbers because they are predictable and neat. Therefore they avoid messy issues like personal preference, tradition, lifelong animosity and historical evidence when it doesn’t fit the formula.

Whether by design of con men or dedicated believers, the arrogance of it can only end in catastrophe. The same factors apply in Rumsfeld’s “smaller military” Iraq plans and Alan Greenspan’s economic bubble bath (tech/productivity and housing) we’re up to our pocketbooks in.

An example of the ups and downs of regulations. Back in 1929 and the subsequent Wall Street crash it was found that a cause of the crash was that at that time banks and stock market firms were one and the same. They had a huge advantage over the investors they had as customers, that advantage was inside information. When the market troubles appeared the customers were screwed as the banks tried to save themselves using inside information as their weapon or protection. The result was a regulation called the Glass-Steagal Act that separated stock firms from banks in the mid 1930s.

That lasted until late 1990s when it was finally repealed during the Clinton Administration and a Republican Congress. We quickly saw the mergers of banks and stock firms and not too long later a repeat of the 1920s conditions. Less than a decade after the repeal the same problems evolved, the use of inside information to screw the customers, stock holders. The details of course are worthy of books, but when the market began it’s decline in 2002, the many bad apples on Wall Street became exposed. The result, regulations (Sarbannes/Oxley Bill) to once again separate banks and stock firms.

And today, once again we hear the grumblings about regulations within the Sarbannes/Oxley Bill. Every reg within that bill was the result of abusing the system of the rich at the expense of the rest of society who are those outside the inside information. This is a classic example of free marketers failing to prove that deregulation works but claiming otherwise because most Americans have no knowledge of this history. Someday, banks and stock firms will probably be allowed to merge once again, when free marketers have let society’s forgetfulness of history evolve. It took about 60 years for the Glass-Steagal Act to be fully repealed, I’m betting it won’t be nearly that long when Sarbannes/Oxley finds its own death.

Why, because the elite power centers wield so much power toward government. This is also the heart of the anti-government rhetoric we hear from Republicans. The less government the less the inclination to protect the masses, or for the centers of money, the outsiders. But the cause will be really the outsiders themselves, because we (I’m certainly an outsider) will have forgotten this case in history because time makes forgetting easier. Our remembering and vigilance upon our government over time is the only answer to keeping this particular regulation in place.

For another interesting case try googling Long Term Capital Management (LTCM) and the government bailout that essentially saved the stock market and possible prevented a world-wide depression if the so-called free market had proceeded without a bailout.

The Glass-Steagal Act is only one case of so many that free marketers are happy for the masses to be ignorant. To the free marketers on Wall Street the late 1990s was a joy, they raped the outsiders and wouldn’t mind another round of that if they could deregulate once again.

Jon B

Yes. They’re working hard against Sarbanes-Oxley, because cos are exiting to the London Stock Exchange which is Oh so lightly and inefficiently regulated.

That is competition, competition in a race for lower standards, less protection for the People. Welfare for corporations.

See Fast Food Nation for that applied to the food industry, the book 100 times better than the film…

heck, nice one here from Scott Ritter on the usefulness of writing letters to your Representatives in Congress !

Yup, I read Fast Food Nation, must have been about six years ago. It was enough to make me give up meat for awhile, it was so sickening.

Lately in America we’ve had several e-coli outbreaks, but all having to do with greens. Lettuce, spinach, green onions, makes one wonder what the hell to eat. Where I work twice in the last few months they’ve had to toss produce, but the delay in finding out about the outbreak means that if we had affected produce it would have already been too late for our customers. We were probably tossing out good produce, the bad stuff, if we had any, would have been used. The problem is that it isn’t until people get sick that action is being taken. I’m sure testing stops much of e-coli affected produce, but quite apparently that testing isn’t catching it all.

Hi jon;

Testing meat regularly I understand, gotta keep them up to standard.

Remember from the book how happy the workers were to produce meat for Old Europe, the higher vet standards meant the management had to slow the lines ?

Veges not so easy I expect.  Why should the slaves wash their hands, after all.

Heck

The Great Risk Shift

tell when you get DSL plentya fun videos out there. And some less fun, but good.

PS see I’m coming from deutschland again, when are they goin to realise I’m not a terrist ?
Well, to make them happy, google ‘Operation Gladio’ , BBC videos site on request.

Jon B & Frog,

I don’t know a lot about Sarbanes-Oxley (SOX) — it came for a vote as I was wrapping up the last annual report I will ever work on. The chief financial officer and accounts were livid due to additional “busy work” it would cause their department.

What I have read doesn’t seem like it would be likely to prevent another Enron debacle. What do you think?

As we deregulated the financial businesses we made up for it by imposing (IMO) far too many new laws and restrictions on individuals. We are forgetting the government is supposed to work for us, not mother us. The latest is New York City’s trans fats ban.

People should have the right to make stupid decisions. I hated the seat belt requirement, not because we should wear them (I installed them in my car when our kids were little — before it became law.) When I think of all those “dangerous things” we did when I was a kid — fireworks, slides and teeter-totters, swings with metal chains, roller skates on concrete, sleds with pointed runners, pre-nerf footballs at an early age, bikes without training wheels, biking without a helmet...loads of fun. Maybe kids sit at the TV because play is so boring.

If there is anything to evolution it won’t be long before kids are born without legs and encased in bubble wrap. They may be working on the genetic engineering now!

Where we do need regulation (it took decades to achieve it) is in government food and drug administration. You mentioned the e-coli… did you hear that one-third of the department’s testing routinely fails?

If I were a terrorist I know what I would do.

Frog, Thanks for the heads up on the videos. I may buy a new computer early next year — I’ve heard there is a new Mac coming out which should bring down the price on the current ones.

Was machen sie nach Deutschland? (nach oder auf? It’s been 49 years since I studied German and I get it mixed up with my little bit of Swedish.)

Heck - confess I ain’t deeply studied, or to be honest , studied at all ! , SOX, but when the really big boys complain about it, it can’t be bad .

So I can’t answer your enron question, .............yet.

Seatbelts we agree make sense. It saves society cash on repairing unnecessarily injured to do some enforcement, BUT, I got caught within the speedlimit last month, just before putting on my belt leaving town, and it cost me a quarter of my driving licence (4 points out of twelve) and 90E---- $120.

That’s going too far—it hits the poor most.

We have a weird society, do we not, when we allow millions to have inadequate healthcare and then legislate nitpicking ‘safety’ measures.

Here in Europe some actually get onto drugs inside prison-- equally weird.

My joke about deutschland was that often on this site my posts come from there. The paranoid reaction would be that since I’m obviously a subversive character, my posts are being monitored.

Its ancient history now, nearly 20yrs, but a local friend was once arrested on semi-terrorism charges, helicopter overhead and all. Heavily-armed Men in black being very serious, you’ve seen similar on the TV ? The local cop accompanying them was in tears, his kid was in the same class as hers. So was mine. She’d actually taken my son to the dentist the day before, proud he was so brave.

She was a lefty who’d skirted bad company , but we all knew she’d have gone along for an interview without the goddam helicopter . 3000people signed a petition to President Mitterand, many of them local, and peasant farmers and country folk generally are not leftwing radicals.or terrists !

A few days later my phone made strange noises, clicks, when I picked it up . So I cussed a little, and it eventually went away.

A while ago I reckoned you would be a good candidate for internment along with Wiley, with Nat and Scorp as guards, in one of those Halliburton FEMA camps.

I was only half joking.

for your records david.law@wanadoo.fr

Yeah, I doubt Sarbannes-Oxley will cure all ills in the corporate world. I just wanted to point out the distinct effect of one law that made sense, then was forgotten why it made sense, abolished, then rediscovered why it made sense, to be once again abolished, the separation of banks and stock firms.

One reason that it came about was to hopefully give the public a renewed confidence in the stock market after the great crash. Unfortunately, the depression followed thereby causing the public not to really have the ability to invest. The market went decades with little activity from the general public. Even many years after WWII the market was still thought of as a place to avoid.

You can see that Sarbannes was put forth for the very same reason, to give people confidence in the market. They had to take action quickly, in order to show that Wall Street could be trusted again. Yet, the two stories are from different ages. With so many people depending on retirement from 401K plans or IRAs, the stock market has a built-in back-up to any foul-ups. Many people have no idea of what goes on in their 401Ks, don’t even pay attention to what their investment holds. When the market was sinking in 2002, I’m betting plenty of people just crossed their fingers and hoped their 401K would hold on.

I think plenty of those laws, like helmets, etc. are really about trying to avoid litigation. In the old days, if you fell off your bike without a helmet, that was that. These days a parent, after some thought, starts wondering if there is a way to sue somebody. A crack in the sidewalk caused the bike accident? Dollar signs!

In some states, motorcyclists have regained the right to not wear a helmet. This sort of bothers me. It’s nuts to ride in todays traffic without one considering the lousy drivers out there. Without a helmet, the lawsuit gets bigger if the rider gets their brains scrambled on the cement. I suppose, this is really about insurance companies, but we all in the end pay the increased rates.

Considering this national story of the Mt. Hood missing climbers (one found dead), I wonder how long before mountain climbing becomes illegal.

My libertarian portion of my brain tells me that if someone does something to only themselves its OK by me, but when a person endangers others, wrong. But that applies to only adults, kids don’t have enough knowledge or experience to decide what really is harmful to just themselves or that something might affect others.

Back to Mt. Hood, these type of stories only make me shrug my shoulders. I’m not really into all the drama, because those climbers chose their drama. In this case, I’m interested simply because I’ve been to Mt. Hood, it’s a beautiful place. But the climbers had planned this long in advance and I think tried to make a quick climb because they knew of the approaching weather rather than cancel their long planned out adventure. They made the wrong choice and now great expense has been enacted on their behalf. I suppose the effort had to be made, but one wonders why we keep doing these searches on behalf of thrill seekers. They might even have reasoned that if something happened it would be their fault, yet parts of society doesn’t see it that way and tries to save them. An interesting individual vs society debate.

Jon B

like the bit about the “libertarian” part of your brain, know what you mean .

Maybe Take theTEST at politicalcompass ?

Thursday night is --- down to the best country pub in normandy (maybe the world...) , pick up bread and goatcheese from local farming friends, , and to talk to real people ,.. not that my netfriends are un-real...., often about the same things we discuss here.

The globalisin steamroller in europe now means postal services gonna be privatised, so long queues at the PO for christmas card stamps, they’re cutting staff. and service.

politics here warming up for next years presidentilal election, and parliament. .

If Sarko had been Pres in 02/03 the frog army would have been in Iraq too, I think,, so will inject that question where i can . !!

He is a smart authoritarionan ambitious SOB networked to the richest men in france and to AIPAC,

great

Frog,

“We have a weird society, do we not, when we allow millions to have inadequate health care and then legislate nitpicking ‘safety’ measures.”
My suspicious mind tells me that the cities, the states and the federal governments here are all in dire financial condition so they are stopping people more often to supplement their own budgets. That way they can say they are not raising taxes and since it is one individual at a time — no protests.

Drugs in prison: Same over here. My letters to representatives have pointed out the War on Drugs is pointless — if they can’t stop drug use in a closed system like a prison why spend millions (billions over time) to attempt to stop it coming across borders. The money would be better spent treating anyone who wants to quit. Legalize/decriminalize and there is no profit.

All of life is so interrelated that it is becoming too complicated for any government to deal with it even when they may sincerely try.

I watched a hour or so on C-SPAN yesterday as I often do. (It is interesting to have heard someone testify before our Senate and then hear a report on our evening TV news — any similarity is purely coincidental.)

The speaker was Marine General James Jones, the NATO commander. He told how difficult it was to integrate the activities in Kosovo. Too many troops, too segmented in action, and too many restrictions and regulations imposed on the civilian population. They finally got things sorted out, but not without tragic delays resulting in many unnecessary casualties.

They have dealt better with it in Afghanistan, but still have “turf” problems (literal and figurative). In addition, virtually all member nations have cut the percentage of their respective budgets devoted to the military and are now faced with