Some Observations about Trump’s Transition

The following are some random thoughts and observations about the unfolding transition of Donald Trump’s presidency.  (I still can’t believe I’m writing those words.)

• Wow, for a guy pushing 70, this guy has a motor!  I stayed up the night of the election until it was clear he had won, which happened about 3 AM on the morning of the 9th.  I was exhausted for the next several days.  Not Trump.  Two days after the election he was at the White House to meet with President Obama and then on to Capitol Hill for a series of meetings.  The next day he launched into an endless stream of meetings with potential staff members – up to twenty meetings a day – and still had the energy to be “tweeting” at 3 o’clock in the morning.  Yesterday – Thanksgiving Day – he was even on the phone with the CEO of the Carrier Corporation trying to convince them that moving their manufacturing operations to Mexico was a bad idea.  The guy is clearly a workaholic.
• In order to push forward his agenda, he needs a cabinet staffed with like-minded individuals, not a “team of rivals” as some have suggested.  I’ve been pretty pleased with his picks thus far, but I really hope he doesn’t pick Romney for Secretary of State.  Romney might soothe ruffled feathers among traditional Republicans and calm nerves among foreign leaders with his polished style and globalist outlook, but that’s not what Trump needs.  He needs someone who can look China in the eye and tell them “tough s___” when they complain about Trump’s trade policy.  That’s definitely not Romney.  Giuliani would be a much better choice.
• Trump has softened his stand on illegal immigrants somewhat, vowing to deport or incarcerate 2-3 million of the worst among them, but expressing a willingness to “consider” the rest.  I’m OK with that as long as he “builds a wall” or takes whatever other actions are necessary to put a halt to illegal border crossings and to immediately deport those who still do make it across.  A pleasant surprise has been his vow to also crack down on some legal immigration, like the H1B visa program which is designed purely to hold down wages.  The program, and others like it, should be completely eliminated.
• Early on, Obama began assembling a team of economic advisors, mostly academics, largely from Harvard.  No wonder his vow to tackle the trade deficit was quickly abandoned.  So far I’ve heard none of this about Trump’s transition team.  Unless I’ve missed something, there hasn’t been a single mention of an “economic advisor.”  Good.  He doesn’t need any.  His economic plans are right on target and he would be hard pressed to find any economists who wouldn’t steer him in the wrong direction.
• So far, his plans to impose tariffs on Mexico and China, though a huge step in the right direction, are too timid.  Tariffs on auto parts from Mexico will only make U.S. auto manufacturers less competitive with imports from Japan, South Korea and Germany.  Tariffs on Chinese imports will only move manufacturers to India, Vietnam, Indonesia and other countries with huge labor forces.  To be successful, he needs to extend his tariff plans to include all products from all such countries.
• I’ve heard some pundits proclaim that some manufacturing jobs won’t come back to the U.S. no matter what he does with trade policy.  That’s absolute nonsense.  If tariffs raise prices to the point where products can be made profitably in the U.S., then someone will seize the opportunity and do exactly that.  For example, if Apple doesn’t move its i-phone manufacturing back to the U.S., then someone else will soon undercut them with cheaper and better phones made right here in the states.
• Manufacturers who have moved to China might be wise to not even wait for tariffs to be implemented.  They’d be smart to move their equipment back to the U.S. before China prevents such moves.
• Despite all the fear-mongering by free trade and globalization cheerleaders about the dangers of “protectionism,” investors seem to be betting on the opposite.  In fact, we see the same thing happening in Britain in the wake of “Brexit.”  I’m reminded of an old saying:  “Money talks and BS walks.”
• The media has been wringing their hands over potential conflicts of interest with Trump’s vast and far-flung business empire.  It’s a potential concern, but everyone knew it when they voted for him and it’s not something he can divest overnight.  Let’s give it time to play out.
• Trump’s not an inspirational orator like Obama has been.  That’s OK.  I’ll happily trade that trait for someone who can get things done to fix our immigration mess and our idiotic trade policy.

There should be no misconceptions that this will be anything but a wild ride.  It’s going to be absolutely fascinating to watch it play out and, if he follows through on his campaign promises on immigration and trade, we’re going to witness a transformation in the U.S. economy that no one even thought possible.

The Population Density Factor in the National Election

http://www.cnn.com/ELECTION/2012/ecalculator#?battleground

OK, here’s a fascinating analysis of the electoral map of the United States that you won’t find anywhere else.  When one looks at an electoral college map like the one you’ll find with the above link, you can’t help but be struck by how the vast majority of the U.S., at least in terms of surface area, is solidly in Romney’s camp.  Yet, Obama leads in electoral votes.  How can this be? 

Population density seems to be playing a critical role.  Of the 16 blue states on this map (those Obama is expected to win), the average population density is 928 people per square mile.  Of the 20 red states – those Romney is expected to win, the average population density is only 60.  The average population density of the six states leaning one way or another is 130.  The average population density of the 9 states considered “toss-ups” is 149. 

In other words, those states favoring Obama are 15 times as densely populated (on average) than those states favoring Romney.  The states that are toss-ups or leaning one way or the other fall in between in terms of population density. 

Perhaps this shouldn’t be surprising.  As populations become more crowded, it’s an inescapable fact that government must play an ever-greater role in maintaining an orderly society.  What’s less obvious to most (but not to those who understand the relationship between population density and unemployment) is that the government must play a greater role in providing a social safety net as populations grow more crowded.  I doubt that many people in the blue states really understand this.  But it seems that they sense it.  At the same time, the theme of smaller government plays well in sparsely populated states where people don’t sense the need for more government because they’ve never experienced living in crowded conditions. 

Sadly, this is a bad omen for the Republican Party.  I say “sadly” because all people would be far better off living in less crowded conditions where there is less need for government involvement in our lives.  The Republican philosophy will slowly resonate with fewer and fewer people.  It may explain why President Obama continues to enjoy as much support as he does in spite of the terrible economy and high unemployment.  Only a few decades ago, when the country was less crowded and more prosperous, he’d have been swept out of office in a landslide.  Today, however, a growing number of people sense that the laissez faire capitalism and globalization advocated by Republicans in this ever-more-crowded, dog-eat-dog world actually offers little hope of a better life.  While Democrats advocate the same things, at least they also favor maintaining a strong safety net (but at a cost that can’t be sustained). 

If Republicans want to prevent their electoral map from slowly shrinking as more states grow more crowded, they’d be wise to wake up to the role of population density in driving unemployment and poverty, and to the fact that the population growth they promote as a source of economic growth is actually choking the life out of their party.

Obama’s Speech: Where’s the Vision?

I don’t have much time to comment this morning, but can’t let Obama’s acceptance speech last night pass without comment.  Like Romney’s, it was loaded with motherhood and apple pie stuff, and gushed empathy for the middle class.  But contrary to speculation that Obama would put forward a new vision for America, all we got was a rehash of timid policies.  More emphasis on education.  A reiteration of the already-failed goal to double exports.  (Although it was interesting to note that the 5-year time frame wasn’t mentioned.  I guess now we’ll just wait for inflation to do the job.) 

Unlike four years ago, Mr. Obama is no longer promising to get tough on trade.  Now he admits that he’s a free trade theory convert.  At least he’s being honest this time, but now we know that there is absolutely no hope of any progress toward restoring a balance of trade and bringing American manufacturing jobs home.

Most disturbing was his “plan” for jobs.  600,000 additional jobs in gas exploration and production.  A million new manufacturing jobs in the next four years.  And that’s about it.  The Democrats complained about the Republicans’ arithmetic on the deficit.  OK, let’s do some arithmetic.  Seventeen million Americans are out of work.  The president holds out hope for hiring 1.6 million of them.  In the meantime, he also promises to import at least two million immigrants into the labor force, and he promises to cut the deficit by $4 trillion over ten years, which will cut about 4 million jobs from the economy.  When I do the math, we end up with 20.4 million unemployed Americans by the end of his next term.  By contrast, Romney says he has a plan to create 12 million new jobs, but hasn’t said how. 

Regardless of how the election turns out, the presidency will indeed be Clint Eastwood’s empty chair for the next four years.

Romney Moves Toward the Middle with Acceptance Speech

For some time now, I’ve been trying to drive home the point that there are no political solutions to our problems because, with either party, you get the same thing when it comes to the issues that matter the most – trade and immigration.  As I listened to Romney’s acceptance speech Thursday night, I couldn’t help being struck by two things:  how heavy the speech was on motherhood and apple pie and how light it was on specifics, and how it seemed to represent a huge step away from the right and toward the middle, as every candidate does once the party’s nomination is secured. 

With that said, I thought it’d be useful to analyze Romney’s speech just to further drive home the point.  First of all, I thought it was well-delivered.  It really captured just how disillusioned and disappointed all of us are with President Obama’s failure to tackle the root causes of our economic decline.  The best line of the speech was the following:

You know there is something wrong with the kind of job he has done as president when the best feeling you had was the day you voted for him.

That really nails exactly how I feel.  It was all downhill from there, when Obama quickly revealed just what a doormat he and his trade negotiators were, contrary to his campaign promises.

Most of the speech was devoted to giving us a window into his life so that we could all better relate to him, which has been a common criticism of the Romney campaign.  In that, he did a good job.  But we also wanted to hear some specifics about what might happen during a Romney administration – especially how he’s going to restore the economy and, in particular, the middle class.  The following is what we got:

… and unlike the president, I have a plan to create 12 million new jobs.

Paul Ryan and I have five steps.  First, by 2020, North America will be energy independent by taking advantage of our oil, our coal, our gas, our nuclear, and renewables.

OK, that’s fairly specific in terms of the date.  But “North America?”  We’re not voting for a president of North America.  We’re electing a leader of the United States.  Does it really matter that much if we shift some oil imports from Saudi Arabia and Venezuela to Canada and Mexico?  That will accomplish nothing. 

Second, we will give our fellow citizens the skills they need for the jobs of today and  the careers of tomorrow.  When it comes to the school your child will attend, every parent should have a choice, and every child should have a chance.

Was that an endorsement of a voucher program to use federal money to send kids to private schools?  Who knows?  But this has nothing to do with creating 12 million new jobs, unless he’s saying that Americans are unemployable because they’re too poorly educated.  But if that’s the case, why is it that half of all college graduates can’t find jobs, as Paul Ryan accurately pointed out in his own speech?  This is the same “retraining” ruse that the Democrats have suggested as a cure for unemployment.

Third, we will make trade work for America by forging new trade agreements, and when nations cheat in trade, there will be unmistakable consequences.

Where have we heard that before?  It sounds like a nearly-verbatim quote from the Obama campaign in 2008.  Forging new trade agreements is what has gotten our economy into the mess that it’s in.  We’re to believe that doing more of it will fix it?  Please.  Aside from the relative handful of people who have benefited from our huge trade deficit, absolutely nobody wants to see more of this.  And we’ve been hearing promises to stop cheating for decades.  This might have been the most laughable moment of the speech.

And fourth, to assure every entrepreneur and every job creator that their investments in America will not vanish, as have those in Greece,  we will cut the deficit and put America on track to a balanced budget.

Wow, that’s a really low bar.  Technically, “cutting the deficit” by only one dollar a year every year puts us on track to a balanced budget.  But it would take a trillion years to get there.  In the meantime, Romney can continue racking up trillion-dollar-per-year deficits, just as Obama has.  Anyone concerned about making meaningful progress toward reining in our debt should be concerned by this point in Romney’s speech.  As I said in my last post, no way will he make any meaningful reductions in the deficit.  He and his economic advisors know very well that that’d yield a recession in short order, just as austerity programs in Europe have.  It’s not the deficit spending in Europe that has killed businesses there.  It’s the austerity programs they’ve adopted to rein in their debt.  With a population density close to that of China, Europe has leaned hard on deficit spending to offset the unemployment they’d otherwise be experiencing.  The U.S. leans hard on deficit spending to counteract the effects of our trade deficit.

And fifth, we will champion small businesses, America’s engine of job growth.  That means reducing taxes on business, not raising them.  It means simplifying and modernizing the regulations that hurt small businesses the most, and it means we must rein in skyrocketing cost of health care by repealing and replacing Obamacare.

This fifth point seems to be three rolled into one – cutting taxes on small business, deregulating and repealing and replacing “Obamacare.”  Regarding that last point, what exactly would that accomplish – repealing it and then replacing it?  And deregulation?  That’s what lead to the financial meltdown.  No thanks.  Cutting taxes on businesses?  That’ll simply add to the deficit. 

Unlike President Obama, I will not raise taxes on the middle class of America.

Whoa.  The eyebrows of the wealthy should have gone up with that one.  Notice that he only promised not to raise taxes on the middle class – the same thing Obama has promised – leaving the door open to taxes on the wealthy – just like Obama wants to do.

As president, I’ll respect the sanctity of life.

What does that mean?  That he will oppose abortion?  That’s not what he said – just that he’ll “respect the sanctity of life.”  The sentence means nothing and leaves him plenty of wiggle room on the issue of abortion. 

I’ll honor the institution of marriage.

Again, what does that mean?  Nothing.  Maybe it means he won’t forget his anniversary. 

And I will guarantee America’s first liberty, the freedom
of religion.

The constitution already does that.  Is he implying something about the debate over requiring insurers to provide birth control, even for employees of Catholic institutions?  If so, he doesn’t actually say it.  It’s a meaningless statement.

President Obama promised to begin to slow the rise of the oceans.  And to heal the planet.  My promises to help you and your family.

Did he just slap the face of every American concerned about the environment?  Yikes. 

President Obama has thrown allies like Israel under the bus even as he has relaxed sanctions on Castro’s Cuba.  He abandoned our friends in Poland by walking away from missile defense commitments.  But he’s eager to give Russia’s president Putin the flexibility he desires after the election.  Under my presidency, our friends will see more loyalty and Mr. Putin will see a little less flexibility and more backbone.

Oh, boy.  Just what we need – a return to the cold war.  No thanks.  I doubt that many Americans really care about Putin.  And relaxing sanctions on Cuba is such a horrible thing when we give away $300 billion worth of our economy to a much larger and more dangerous communist regime like China?  Who cares about Cuba? 

Does the America we want borrow a trillion dollars from China?

I hate it every time I hear this, regardless of whether it’s Romney or whoever.  It makes it sound like the U.S. goes to China with hat in hand asking to borrow money, like George Bailey  begging from Mr. Potter.  That’s not what happens.  We spend $300 billion a year on Chinese goods, and the Chinese have to plow those dollars back into America somehow.  Buying treasuries is how they do it.  The real problem is the trade deficit, not what the Chinese do with our dollars once we’ve given them to them.

Look, I’m not trying to bash Romney any more than I’ve been bashing Obama lately.  The point I’m trying to make is that nothing substantive is going to change under either one of them.  Swerving left and right on the road to nowhere still leaves us heading nowhere.  Tinkering at the margins with policy minutia accomplishes nothing.  Taxes and spending are completely and utterly irrelevant.  But that’s all we ever get from our politicians.  The real problems are the trade deficit that has bankrupted this country and the ever-escalating problems associated with growing our population further and further beyond the limits of economic sustainability.  In these regards the platforms and policies of both the left and right are identical – they will do nothing. 

Maybe Clint Eastwood’s empty chair metaphor is actually quite appropriate.  Regardless of whether Obama or Romney wins the election, the chair might as well be empty for all the difference it will make.

“This man will not fail!”

The highlight of the Republican national convention last night was Ann Romney’s emphatic proclamation that “this man will not fail!”  It was preceded by a littany of candidate Mitt Romney’s many successes in life, both in the private and public sectors – his business success and his success in cutting spending and balancing the budget as governor of Massachusetts.  And her proclamation was also a swipe at President Obama’s obvious failures to restore the economy, bring down unemployment and rein in the exploding debt. 

But past successes are no guarantee of success as president of the United States.  First of all, regarding Romney’s success in balancing Massachusetts’ budget:  of course he was successful.  Nearly every governor is successful at balancing the budget of his or her state because nearly every state’s constitution requires that the budget be balanced.  The governor and his legislature were duty-bound to agree on some combination of spending cuts and revenue increases in order to achieve a balance.  They can’t go home until they do.  And, let’s not forget, governors’ jobs are much easier than the president’s job in that regard because the states have a big sugar-daddy – the federal government – to pick up the slack. 

As president, Romney will have no such luxuries.  Our constitution doesn’t require a balanced budget because our founding fathers never imagined that our leaders would be so stupid as to create such a fiscal mess.  So there is no driving force for Congress to compromise and reach a consensus.  Under President Romney, Republicans will be just as adamant about not raising taxes and Democrats, smarting from four years of Republicans’ stone-walling efforts to reach a compromise each time we bumped our heads against the debt ceiling, will now be even less willing to cut spending.  It’s highly unlikely that Romney will be any more effective in breaking the gridlock in Washington. 

And success in the business world is no predictor whatsoever of success running the federal government.  The objectives of each are polar opposites.  There is only one goal in the business world.  It’s not creating jobs.  It’s not helping the overall economy.  It’s not improving the lives of people.  It’s not the high-minded, almost-philanthropic slogans that each corporation proclaims in their image-building ads on TV.  It’s none of these.  The only goal of business is making money – as much as possible – in any way legally possible.  The interests of employees are of no concern at all  (at least to the extent that the business is able to retain a minimum of highly productive employees), much less the interest of the common good.  For business leaders, the business is the master that all others in the organization serve.

That’s not a criticism.  It’s the way things must be in a society that utilizes capitalism as its economic model.  If such an economy is to succeed, profit must be the first priority of its business leaders.

But the role of government is the polar opposite.  The common good is the chief objective.  While it’s in the interest of the government of a capitalistic society to maintain a business-friendly atmosphere, the role of government is to assure that capitalism functions as our servant, and not our master.  It’s role is to establish boundaries that prevent businesses from heading down a path that’s not in the interest of the common good.  That requires some empathy for others. 

My wife and I had an interesting discussion the other day with our son who is working on his Phd in psychology.  For some reason, we got into a discussion about sociopaths vs. psychopaths, and what the distinction might be.  We were aware that a sociopath is a person who is virtually devoid of empathy, incapable of having sympathy for others.  Our son pointed out that there really is no difference; they’re terms that are used almost interchangeably, but the term “psychopath” is generally applied to those whose lack of empathy has resulted in some violent crime.  Sociopaths are not necessarily violent.  There are plenty of sociopaths who function normally in society.  These are kown as “functioning sociopaths,” my son explained.  While sociopaths are lacking in empathy, they also are fully capapble of recognizing others’ emotions and feelings and are able to manipulate them to their advantage. 

I remarked that a sociopath may be well-suited to being a CEO of a corporation, since the job so often requires decisions that may negatively impact a lot of people.  He replied that, in fact, in psychology texts, corporate CEOs are often cited as examples of “functioning sociopaths” – making them ideally suited to making decisions that hurt many people without giving it a second thought.  They go home and sleep soundly. 

While sociopathic qualities may serve a business leader well, it’s a quality that makes one poorly suited to serving the common good.  I’m not saying that Romney is such a person, but stories I’ve heard make me wonder if he lacks empathy.  Even last night, following an emotional speech by his wife and the thunderous applause of admiring thousands, his reaction seemed to be little more than a rehearsed smile. 

His wife, Ann, is wrong.  If elected, Romney will fail, but not for any of the reasons I discussed above.  He will fail because, challenged with reviving the economy and reining in the debt, he faces only three choices:

1. Cut the federal budget deficit in a meaningful way, most likely through deep spending cuts (but don’t be surprised if some tax increases are included) in the belief that reining in spending will somehow boost the economy.  This will placate those whose biggest concern is our exploding national debt.
2. Make only token cuts, but otherwise continue to run budget deficits of close to a trillion dollars per year in order to avoid a recession.
3. Address our failed trade policy to bring millions of manufacturing jobs back home.

Those are the only three choices he has.  The only one that would have any meaningful impact on restoring the economy – the last – is one he will clearly not choose.  He has already promised a huge new, all-encompassing free trade deal.  Our trade deficit will likely get worse.  There’s no hope that it would improve.

That leaves the first two options.  The first would surely drive the economy into recession.  He knows that.  His economic advisors know that.  They know that anything that takes money out of the economy – like taxes – hurts the economy.  And they know that anything that puts money back in the economy – like federal spending – helps the economy.  So he won’t do it.  They may shift spending from social programs to defense spending, but there won’t be any real reduction in the deficit.  You can take that to the bank. 

Which means that he will default to continuing the status quo – running huge budget deficits to stoke the economy with money that is drained away by the trade deficit – kicking the can down the road.  In all likelihood, it will be in the guise of a budget that predicts less spending and more revenue in the future, when the economy is mysteriously healed and the macroeconomy is inexplicably growing again at 4-5% per year.  Probably the time frame will be about 8-10 years out so that he never has to explain why we never really arrived there. 

Romney will fail because his economists will continue to rely upon growth, including population growth, to cure economic problems that have been caused by growth itself and by attempting to grow through free trade with nations where growth-induced economic problems are even worse.  How can he possibly succeed when the field of economics that he will reply upon for economic advice is itself a complete and utter failure?

Comparing Presidential Hopefuls on Immigration

https://www.numbersusa.com/content/action/2012-presidential-hopefuls-immigration-stances.html

The above-linked grid provided by NumbersUSA is a good snapshot of where each Republican candidate (as well as President Obama) stands on the issue of immigration – not just illegal immigration, but on reducing immigration overall, both legal and illegal.  And, if you position your mouse over each issue, you’ll get a pop-up explanation of that candidate’s statements and actions that underly the NumbersUSA rating.  It’s the best tool I’ve seen by far for comparing the candidates on immigration. 

Just to summarize, here are the overall grades given by NumbersUSA:

1. Michelle Bachmann:  B-
2. Mitt Romney:  C-
3. Rick Perry:  D
4. Rick Santorum:  D
5. Jon Huntsman:  D-
6. Newt Gingrich:  D-
7. Ron Paul:  F
8. Barack Obama:  F-

I continue to believe that Romney will be the Republican candidate.  I also believe that, if he is, he will beat Obama in a close election, due in large part to the sorry state of the economy which, I believe, is going to worsen in 2012.  At least we can look forward to an administration that will be tougher on illegal immigration. 

Many thanks to NumbersUSA for providing this grid and for their outstanding work is raising awareness of immigration’s role in driving destructive population growth and for lobbying in favor of reductions in both legal and illegal immigration. 

 

Americans Giving Up The Hope That Swept Obama into Office

http://www.cnbc.com/id/43268037

The above-linked piece appeared on CNBC’s web site a couple of days ago.  A new poll shows that Americans are losing hope that the economy will ever recover – not just anytime soon, but ever.

… according to the latest survey from business-advisory firm AlixPartners … an increasing number, some 61 percent, say they don’t expect to return to their respective pre-recession lifestyles until the spring of 2014, if ever.

What’s worse, a full 10 percent said they expect they will never return to pre-recession spending.

This morning, a new ABC poll finds that, if an election between Obama and Mitt Romney were held today, Romney comes out ahead by 3 percentage points among registered voters.  59% disapprove of the president’s handling of the economy.  89% say that the economy is in bad shape.  And 25% are “downright angry,” matching the highest reading on that poll question reached in 1992, when George H.W. Bush was swept out of office.

Since the election of Obama, the economy’s slide into recession – perhaps even depression – was arrested by a sugar high of deficit spending and quantitative easing (printing money) by the Federal Reserve.  As long as the sugar was flowing, the illusion of prosperity that was long maintained by one economic bubble after another, was kept alive a little longer and, with it, Obama’s approval ratings.  But now that the 2-year stimulus spending plan and the latest program by the Federal Reserve are simultaneously coming to an end, perception is once again giving way to reality.  The economy is tanking and, with virtually no appetite for any further deficit spending or Fed balance sheet expansion, the prospects are grim.  In spite of Republican assurances that the private sector will rush in to fill the void left by big cuts to government spending, few really believe it.  Most understand that, once the government shuts off the money tap, the party’s over. 

Obama was swept into office on a tidal wave of hope, fueled by his oft-repeated campaign promise to address our broken trade policy and bring back American manufacturing jobs.  Not a single promise on trade has been kept, including his promise to at least not make matters worse by signing any more job-killing free trade agreements like the one he signed with South Korea, limiting  our auto exports to 75,000 per year while giving the Koreans unlimited access to our auto market. 

Now it’s too late.  When 2nd quarter GDP numbers are released in July, it’ll confirm what everyone already knows – that the economy has slipped back into recession.  Although it’s never too late to fix our trade policies (not that Obama will do it), it’s too late for the effect to take hold before the next election.  Such a move would exacerbate inflation in the short term and only after manufacturing has begun its shift back to the U.S. – a process that would take a minimum of 2-4 years – would the positive effects of the change begin to be felt. 

So, at this point, Obama’s fate is sealed.  By the time the election rolls around, there will be proverbial pitchforks in the streets and his re-election hopes will be doomed.  Good riddance.  He broke his promise of “hope and change” and substituted the Democratic standard approach – deficit spending, leaving the root cause of our problems – the trade deficit and worsening overpopulation – untouched. 

Unfortunately for Americans, all we’ll get from Romney or whoever else survives the Republican primary, despite any promises to the contrary, will be the usual – tax cuts and trickle down economics (which, since the explosion of the trade deficit since Reagan, is more properly described as “trickle out” economics).  What will be the Republican mantra?  Instead of “hope and change,” it should be something like “change for the sake of change, since there is no hope.”

Nearly 600,000 Jobs Lost in a Week

http://www.reuters.com/article/ousiv/idUSTRE50L36C20090122

The Labor Department reported today that nearly 600,000 people filed for unemployment last week.  That’s an annual rate of over 30 million workers losing their jobs – over 20% of the work force. 

I thought you might be interested in some anecdotes from the state of Michigan.  It was reported yesterday that in one month, from November to December, unemployment in Michigan rose by a full percentage point to 10.6%.  And it seems that the unemployment offices have been completely overwhelmed.  Phone lines are jammed.  The web site has crashed from overuse.  People are forced to take their questions directly to the unemployment office.  The local news showed a line at one such office that appeared to stretch for a full city block.  I’m reminded of pictures of the unemployed waiting in lines during the Great Depression.  And many of these are highly skilled people.  One guy interviewed had two master’s degrees and worked in an IT department.  Yet, some politicians still offer up “job retraining” as the solution.  Retraining to do what?  Where is the huge demand for labor that’s going unmet because Americans are too uneducated to fill the positions?  The only retraining needed around here is how to fill out unemployment application forms. 

I’m also reminded of a visit to Michigan by Mitt Romney during the Republican primary campaign.  He told Michiganders condescendingly that we’re in a “one-state recession.”  Well, it isn’t a one-state recession any more, is it?  It makes you wonder whether the state of Michigan is the canary in the coal mine for the U.S. economy.  If we are, the rest of you had better hunker down because it’s going to get much, much worse!