Cause of U.S. Economic Melt-Down Captured in One Photo

November 23, 2008

http://www.reuters.com/article/ousiv/idUSTRE4AJ7LF20081123?sp=true

Check out the photograph at the top of this linked story.  Bush is flanked on either side and holding hands with Japanese Prime Minister Taro Aso and South Korean President Lee Myung-bak at the meeting of APEC leaders in Lima, Peru yesterday, November 22nd.  This photo captures perfectly the root cause of our economic melt-down, the leaders of two of the most parasitic economies in the world standing hand-in-hand with the leader of their “host” economy.  And everyone is all smiles.  Bush is all smiles because he’s clueless about the global trade welfare state that he supports on the backs of working Americans and is just happy to be fawned-over and well-fed.  Aso and Myung-bak are all smiles because the leader of the host economy upon which they feed is all too willing to keep the blood flowing.

U.S. President George W. Bush, Chinese President Hu Jintao, Japanese Prime Minister Taro Aso and other members of the 21-nation Asia-Pacific Economic Cooperation group, or APEC, said they would refrain from raising trade barriers over the next 12 months.

… Bush joined APEC peers in rejecting protectionism even if economies worsen.

Isn’t this the very definition of madness, to keep doing the same thing while expecting different results?  Of course, how could we expect anything else from Bush when his economic team of Paulson and Bernanke never utter a peep of protest about the trade deficit? 

But not everyone is happy.

Before the group met, Canadian Prime Minister Stephen Harper and Mexican President Felipe Calderon blamed the United States for starting the crisis and called for better banking regulations.

“Our closest neighbor and largest trading partner is the epicenter of the financial earthquake and global slowdown,” Harper said in a speech to business leaders.

Calderon said structural problems in the global economy were allowed to fester before spiraling out of control.

Of course, Calderon’s protests are a bit like a parasite complaining that the blood of its host tastes funny.  Mexico never complained while they racked up huge trade surpluses with the U.S. year after year.  But now that the parasitic economies like Mexico have sickened the host, all of a sudden it’s our fault.  Well, in a way it is our fault, in the same way it’s an owner’s fault for not giving his dog a flea bath, allowing it to be sickened by the parasites.  Our government is the owner of our economy and it has kept the flea powder of tariffs on the shelf for far too long.

We’ll be fortunate to survive another two months of Bush.  Obama seems like a very smart man.  Is he smart enough to understand the role of the trade deficit in bankrupting the nation?  If he is, does he also have the guts to do something about it?  He’ d better, while the nearly lifeless carcass of our economy still has an ounce of blood left.


Bush: “It’s a sign that we’re losing confidence.”

April 29, 2008

Perhaps the most noteworthy comment from Bush’s typically-painful news conference today was one that the pundits completely missed in their post-conference wrap-ups.  The President was commenting on the rising tide of protectionist sentiment in the country.  “It’s a sign that we’re losing confidence,” he said. 

It was probably a Freudian slip, but one that came very close to Jimmy Carter’s “malaise” speech, in which Carter made a similar observation, although never using the word “malaise” himself.  That word was used by pundits in describing Carter’s tone, but it came to define the overall failure of his policies.  In this case, it’s an admission by Bush that the country has lost confidence in his policies. 

You bet we’re losing confidence!  We’re losing confidence in the same way that people lose confidence in any approach (in this case, “free” (blind) trade policies) that, after decades of experience, have proven to be a complete and utter failure.  How else can you describe a trade policy that has produced a cumulative deficit of $9 trillion since 1976, one that has destroyed the value of the dollar and transformed America’s credit rating in the global community to “junk” status?  Perhaps we’re not so much losing confidence as we are wising up. 

One final comment on the news conference:  it was another opportunity lost for the journalists.  In spite of all the discussion of soaring oil and food prices and whether or not supplies are adequate or even in decline, the thought never occurred to any of the journalists to ask Bush why we then continue to pour fuel on the fire by maintaining an extremely high rate of immigration.  How I’d love to hear him try to answer that one.  He might set a new Bush record for hemming, hawing and “uhhhhhs!”

The end of this dismal chapter in America’s history can’t some soon enough. 

Pete


In Meeting with Guatemalan Leader, Bush Betrays America Again

April 29, 2008

http://afp.google.com/article/ALeqM5i1husekv0SAY-7ALHc63hZXtqj7w

While meeting with Guatemalan President Colom, Bush came down on the wrong side of our two most critical issues again – trade and immigration.  Bush supported free trade with Guatemala and offered hope to Colom of granting “temporary protected status” to Guatemalan immigrants, both legal and illegal. 

With a population density near that of China, Guatemala has nothing to offer Americans in trade for access to our healthy market except another automatic, irreversible trade deficit and loss of manufacturing jobs for American workers. 

And rampant population growth threatens our economy and quality of life. Immigration, both legal and illegal, are fueling this growth.  I’m not talking just about the obvious problems that we see in the news – growing dependence on foreign oil, carbon emissions, soaring commodity prices, environmental degradation, etc. I’m talking about the effect upon rising unemployment and poverty in America.

Our policies of encouraging high rates of immigration are rooted in the belief of economists that population growth is a good thing, fueling economic growth. Through most of human history, the interests of the common good and business (corporations) were both well-served by continuing population growth. For the common good, we needed more workers to man our factories, producing the goods needed for a high standard of living. This population growth translated into sales volume growth for corporations. Both were happy.

But, once an optimum population density is breached, their interests diverge. It is in the best interest of the common good to stabilize the population, avoiding an erosion of our quality of life through high unemployment and poverty. However, it is still in the interest of corporations to fuel population growth because, even though per capita consumption goes into decline, total consumption still increases. We now find ourselves in the position of having corporations and economists influencing public policy in a direction that is not in the best interest of the common good.

The U.N. ranks the U.S. with eight other countries – India, Pakistan, Nigeria, Democratic Republic of Congo, Bangladesh, Uganda, Ethiopia and China – as accounting for fully half of the world’s population growth by 2050. The U.S. is the only developed country still experiencing third world-like population growth, most of which is due to immigration. It’s absolutely imperative that our population be stabilized, and that’s impossible without dramatically reining in immigration, both legal and illegal.

Pete


State of the Union Address

January 30, 2008

A few words are in order regarding the President’s State of the Union address on Monday night.  The president raised two issues that are of particular interest to me, of course.  First of all, he raised the issue of free trade, imploring Congress to pass free trade agreements with Columbia and South Korea.  And he did some “cheerleading” for free trade in general, observing that exports are up and that we need to open more markets to American goods. 

Secondly, he implored Congress once again to pass immigration reform with features that make it easy for immigrants to arrive legally to do the work that “needs to be done.” 

I have no problem with a free trade agreement with Columbia.  With a population density of 103 people per square mile, they are very similar to the density of the U.S. (83 per square mile) and so they represent no threat to American manufacturers.  South Korea, however, is a far different story.  With a density of 1257 people per square mile, more than 15 times as densely populated as the U.S., their market is very badly stunted by over-population.  They have virtually no market to offer in return for access to ours.  This deal would be a guaranteed loser for American manufacturers.  If fact, it already is.  Cars from South Korea – Hyundais, Kias and even Chevy Aveos – have been pouring into this country for years, contributing to the devastation of our domestic auto manufacturers.  In return we get absolutely nothing.  It’s a crime against the American people to permit such a situation to persist. 

Regarding his general cheerleading for free trade, yes, exports are up a little.  As a result, our annual trade deficit is something like $710 billion per year instead of $720 billion.  The result is a loss of 14 million jobs.  Free trade cheerleaders like president Bush always conveniently ignore the import side of the trade equation.  Opening new markets is fine, as long as they are markets that are equivalent to ours, where their customers are likely to buy as much from us as we buy from them.  I am not opposed to free trade.  On the contrary, I believe that free trade in natural resources and between countries of roughly equal population density is truely beneficial.  However, free trade with countries that are much more densely populated than us is a sure-fire loser for domestic manufacturers and should never be pursued. 

Regarding immigration, we do need immigration reform.  We need to seal the border and then work to reduce legal immigration by 95%.  Rampant population growth is the number one challenge facing this country.  No progress on problems like energy independence and global warming is possible without first stabilizing our population, not to mention the damage done to Americans’ finances and quality of life by increasing our population density. 

We need a president who’s willing to face realities and take meaningful action to address the real problems instead of symptoms.

Pete