The American Nightmare: No Exit, No Entry

Re: # 229 HP

{...“The present financial situation of the US is that of technical insolvency.” -- SR

Are you kidding me? Technical insolvency? Where did you go to school?...``}

You mind is obviously made up already... so I must not confuse you with facts. Please continue to live in you-know-whose paradise.

...SR

PS: Since you seem to be keen to make this announcement, please do declare the name of the ``top notch`` US school that you obviously seem to have attended and want to brag about... Princeton? Harvard? Yale? Stanford? Northwestern? Pray, tell us which???

#228 by baggarbilla

The Canadian government has pulled a hoax on unsuspecting immigrants. It pains me to see some highly qualified people, who were given immigration on the bases of their qualifications, are forced to drive cabs and do odd jobs in Wal-Mart and other joints like that in Toronto and many other cities.
These people burned their life savings, gave up good jobs and now they are filling the odd jobs requirements for the Canadian businesses.
I think the immigrants should sue the Canadian government for misleading and pulling a fraud on them. What a pity…

#227 by SR

You are an interesting man with a literal mind! I tried to make it simple for you and you come back with this…

“why then would there have been the need to go in debt in order to attract foreign capital to the tune of almost $2 Billion a DAY… ??”

Is the US forcing any country to buy the treasury bonds? And why the foreign capital is invested to the tune of 2 billion a day, if the investment is not good…Actually foreigners buying the bonds shows the strength of the US economy and not a weakness.

“GM in this case..They are content to rest on their laurels instead of reinventing themselves. They’ve become too big and unadaptable.”

If some company is not following good business practices then how is that US governments fault? You want the US government to run the corporations too? I just love the way you present ideas na koi sar na koi paer.

“The present financial situation of the US is that of technical insolvency.”

Are you kidding me? Technical insolvency? Where did you go to school?

“That is four million fewer W2s and thus four million fewer 1040s. The Federation is ultimately eroding its tax base.”

First you lament that enough people are not coming to the US, when I pointed out the reason for people not coming in- you start to lament the loss of 4 million jobs and tax base…What is your real point…any country that can send 4 millions job to the poor countries and help them out, imo, is not doing badly at all. Further, a loss of tax base…where is that? Do we even know the unemployment numbers in the US?

Still, there is lots of room to cut taxes and spending and that is the problem that the Bush admin is not taking care of.

The US needs to bring its defense and Iraq related expenses in line. It needs to cut lots of pork and that can be done with this admin or with the next admin. The US is not nearing doom that you make it out to be.

Now I can fully understand why you don’t wanna live in the US…I see where the disconnect is…

To all the Interactors! especially Kulharee

Being a Canadian myself, and now working in US because all that Multiculturism BS that Canada talks about is actually to maintain an aging infrastructure on Immigrant influx, Who are forced to toll in ODD JOBS day in and day out, regardless of Advance Degrees you get from Canadian institutions. A simple economics question to Saima, How can a country with a meagre population of 32 Million and equally meagre economy can possibly accomodate 2,50,000 Skilled Immigrants each year? What`s the point in celebrating Canadian Multiculturism when all it means is that you are condemned to a Odd job life for really really long and pehaps perpetually?

#226 by HP

{“… you are putting forward contradictory statements… see the gaps in your thought process…

…you contradict yourself … if you don’t spend money how you are going to build new businesses, New factories and new and better products. All of these come from spending and not saving…”}

Dear HP … Your enthusiasm is refreshing and your arrogance is amusing. If you look carefully, you’ll see that your argument is quite charged with emotion though lacing in depth. You simply misinterpret terminology. I was referring to consumer spending. This is quite distinct from capital spending or capital investment. The two are not synonymous.


{“… what is the point of building better automobiles when there is no one willing to spend money to buy them?...

…you are trying to mix differing economic thoughts under one roof and that too with some really simplistic explanations. …”}

Here again, you are quick to cast stones at others while unconcerned of your own glass house.

The point on offer was that a major US company, GM in this case, was a reflection of the malaise and arrogance that seems to have taken hold of many US institutions. They are content to rest on their laurels instead of reinventing themselves. They’ve become too big and unadaptable. This phenomenon has given foreign competators an edge. Toyota, for example, has been having GM’s lunch for a number of years and what has GM done to recapture market share? Zilch… You, of course, did not get the drift so you start off firing from the hip. I admire the spark in your spirit though its not always conducive to a mature exchange of ideas.

{“…The US savings rate is appropriate for most the capital needs of the country. }

Please refrain from making such platitudes. If this were true, why then would there have been the need to go in debt in order to attract foreign capital to the tune of almost $2 Billion a DAY… ??

{“…There has never been a shortage of capital in the US due to lack of savings to support the capital needs. …”}

If someone with your discussion style looks at this statement and compares it to the one immediately above, he would scream “…self-contradiction… self-contradiction…” And would hastily add that in the first sentence you claim that “US savings rate is appropriate” for the country’s ”capital needs” and then you mention ”lack of savings” in the next sentence. Please understand that I do not want to be engaged in this sort of a childish argument, just for the sake of argument.

The present financial situation of the US is that of technical insolvency.

Nonetheless, the US has had the unique advantage of owning a national currency that has been the de facto reserve currency of world trade. That situation, however, is gradually changing and the writing is on the wall for all to see. But of course, one does not have to see it. Closing one’s eyes to facts is quite a common response.

{“…If we consider Social Security as yet another savings vehicle then you will be surprised at the percentage of savings to sustain any capital requirement.

If only the social security is moved into financial system instead of supporting the Federal Budgets, the US savings rates would be astronomical. …”}

Now this is beyond fiction. It is bordering on fantasy.

Go ask Paul O’Neil, the former Treasury Secretary. He got fired because he angered Bush when he wanted to add the results of the government study into the 2004 budget document, showing that the projected Social Security shortfalls were in the TENS of $ TRILLIONS

{“ … it had happened many times in the history…These are part of the economic cycles and often bad policies by the a given admin. This trend is reversable. A few years of effort would change that…”}

I cannot address this point. No one argue against FAITH …

{“…Do you know how many jobs the US outsourced to turn the tide of immigration to the US in the last three or four years?

Yes, I do know that awful number. It’s well over four million.

That is four million fewer W2s and thus four million fewer 1040s. The Federation is ultimately eroding its tax base.

In the long run it may prove to be a blessing when the 12 aircraft carrier groups floating around the world become harder and harder to finance.

225 by faisaluno

Thank you. I hope some of our friends here will read it.

…SR

#222 by SR

“As the author of the article points out, consumer spending cannot make people rich; instead, it makes them poor. You don’t get rich by spending; you get rich by saving…and building new businesses, new factories, and new and better products. You get rich by foregoing consumption in favor of production - so you can produce better automobiles, for example, than your competitors. But the United States has done just the opposite. It consumes…and allows its competitors to invest and produce. Where do you think this might lead the US?”

I really have no opinion on your decision to leave the country… But I do think that you are putting forward contradictory statements to prove you point. I hope some day you will be able to see the gaps in your thought process…

Your write, “consumer spending cannot make people rich;” then you contradict yourself by claiming this “you get rich by saving…and building new businesses, new factories, and new and better products” Please if you don’t spend money how you are going to build new businesses, New factories and new and better products. All of these come from spending and not saving. Now please tell me what is the point of building better automobiles when there is no one willing to spend money to buy them?

It appears to me that you are trying to mix differing economic thoughts under one roof and that too with some really simplistic explanations. The US savings rate is appropriate for mostthe capital needs of the country. There has never been a shortage of capital in the US due to lack of savings to support the capital needs.
If we consider Social Security as yet another savings vehicle then you will be surprised at the percentage of savings to sustain any capital requirement. I hope you know how much an average taxpayer contributes to the SS and what employers’ contributions are. If only the social security is moved into financial system instead of supporting the Federal Budgets, the US savings rates would be astronomical.

“so you can produce better automobiles, for example, than your competitors. But the United States has done just the opposite.”

The consumer in the US provides incentive to the foreign manufacturers to produce a better product or the foreign competitor would never be able to get a share of the market. That should be to the credit of the US consumer. This fact should not be used to hit the consumer in the head to stop spending their money wisely.

“In 1980, the US was still the world’s largest creditor. By 1985 it had become a net debtor. This trend accelerated under Greenspan. Since Alan Greenspan took office on Aug. 11, 1987:”

Interesting thought…do you recall that before 1980 US was a creditor nation and it had happened many times in the history…These are part of the economic cycles and often bad policies by the a given admin. This trend is reversable. A few years of effort would change that.

“2004 was also a watershed year. For 63 years the USA was like a magnet, attracting the world’s best “brains” to its shores. There was a net brain-gain, year after year, for 63 years. That, tragically, changed for the first time in 2004. For the first time in over six decades there was a net brain-drain from the US.”

I find this factoid amusing…Do you know how many jobs the US outsourced to turn the tide of immigration to the US in the last three or four years? Did you know that US is not accepting as many professionals on H1 and other visas and sending jobs outside for exactly the same professionals that it was importing before 2002?

I hope you would look at the numbers in the right context before putting them forward as some sort of decline in the US standards.

``I believe because the USA has become the USSA (insert the extra “S” for Soviet)… Government of the Corporations, by the Corporations, for the Corporations. (The term fascist is more appropriate, but Soviet rhymes better and invokes the image.)``

I hope you can support this with real facts and numbers instead of just your “belief and faith”.

“Many of us desi-babus are literalists. Another word for this is fundamentalists.” –SR

I agreed with your assertion and I don’t find you any different...

interestingly enough, paul krugman in his last two columns has touched on some of the issues bought up here. his column from nytimes is pasted below in entirety for folks who dont have access to nytimes:

November 28, 2005
Op-Ed Columnist
Age of Anxiety
By PAUL KRUGMAN

Many eulogies were published following the recent death of Peter Drucker, the great management theorist. I was surprised, however, that few of these eulogies mentioned his book ``The Age of Discontinuity,`` a prophetic work that speaks directly to today`s business headlines and economic anxieties.

Mr. Drucker wrote ``The Age of Discontinuity`` in the late 1960`s, a time when most people assumed that the big corporations of the day, companies like General Motors and U.S. Steel, would dominate the economy for the foreseeable future. He argued that this assumption was all wrong.

It was true, he acknowledged, that the dominant industries and corporations of 1968 were pretty much the same as the dominant industries and corporations of 1945, and for that matter of decades earlier. ``The economic growth of the last twenty years,`` he wrote, ``has been very fast. But it has been carried largely by industries that were already `big business` before World War I. ... Every one of the great nineteenth-century innovations gave birth, almost overnight, to a major new industry and to new big businesses. These are still the major industries and big businesses of today.``

But all of that, said Mr. Drucker, was about to change. New technologies would usher in an era of ``turbulence`` like that of the half-century before World War I, and the dominance of the major industries and big businesses of 1968 would soon come to an end.

He was right. Consider, for example, what happened to America`s steel industry. In the 1960`s, steel production was virtually synonymous with economic might, as it had been for almost a century. But although the U.S. economy as a whole created lots of wealth and tens of millions of jobs between 1968 and 2000, employment in the U.S. steel industry fell 60 percent.

And as industries went, so did corporations. Many of the corporate giants of the 1960`s, companies whose pre-eminence seemed permanent, have fallen on hard times, their places in the business hierarchy taken by new players. General Motors is only the most famous example.

So what? Meet the new boss, same as the old boss: why does it matter if the list of leading corporations turns over every couple of decades, as long as the total number of jobs continues to grow?

The answer is the reason Mr. Drucker`s old book is so relevant to today`s headlines: corporations can`t provide their workers with economic security if the companies` own future is highly insecure.

American workers at big companies used to think they had made a deal. They would be loyal to their employers, and the companies in turn would be loyal to them, guaranteeing job security, health care and a dignified retirement.

Such deals were, in a real sense, the basis of America`s postwar social order. We like to think of ourselves as rugged individualists, not like those coddled Europeans with their oversized welfare states. But as Jacob Hacker of Yale points out in his book ``The Divided Welfare State,`` if you add in corporate spending on health care and pensions - spending that is both regulated by the government and subsidized by tax breaks - we actually have a welfare state that`s about as large relative to our economy as those of other advanced countries.

The resulting system is imperfect: those who don`t work for companies with good benefits are, in effect, second-class citizens. Still, the system more or less worked for several decades after World War II.

Now, however, deals are being broken and the system is failing. Remember, Delphi was once part of General Motors, and its workers thought they were totally secure.

What went wrong? An important part of the answer is that America`s semi-privatized welfare state worked in the first place only because we had a stable corporate order. And that stability - along with any semblance of economic security for many workers - is now gone.

Regular readers of this column know what I think we should do: instead of trying to provide economic security through the back door, via tax breaks designed to encourage corporations to provide health care and pensions, we should provide it through the front door, starting with national health insurance. You may disagree. But one thing is clear: Mr. Drucker`s age of discontinuity is also an age of anxiety, in which workers can no longer count on loyalty from their employers.

from his previous column:

...About the trade deficit: These days the United States imports far more than it exports. Last year the trade deficit exceeded $600 billion. The flip side of the trade deficit is a reorientation of our economy away from industries that export or compete with imports, especially manufacturing, to industries that are insulated from foreign competition, such as housing. Since 2000, we`ve lost about three million jobs in manufacturing, while membership in the National Association of Realtors has risen 50 percent.

The trade deficit isn`t sustainable. We can run huge deficits for the time being, because foreigners - in particular, foreign governments - are willing to lend us huge sums. But one of these days the easy credit will come to an end, and the United States will have to start paying its way in the world economy.

To do that, we`ll have to reorient our economy back toward producing things we can export or use to replace imports. And that will mean pulling a lot of workers back into manufacturing. So the rapid downsizing of manufacturing since 2000 - of which G.M.`s job cuts are a symptom - amounts to dismantling a sector we`ll just have to rebuild a few years from now.

#210 by SaimaShah

I referred to social security just to bring a point home. It was not meant to start a debate on that issue as it is a different debate and I don’t think I have studied it enough to discuss it in details. My general comment was about an idea that I consider progressive came from the conservative party. There are many issues involved with the social security and it will need another thread to discuss that.

“I think the struggle should no longer be classified as between the liberals and the conservatives. New polarities should emerge --. In the last few years one notices an odd thought similarity between the Christian agenda and the left.”

The struggle has always been and will always remain between the liberals and the conservatives. Both groups pick up alliances and then switch alliance based on the issues at a given time. There was a time when the conservatives championed cutting and savings in the govt expenses but now they spend more and save less. The liberals are now chiding them to save and spend less. In the US, both liberals and the conservatives don’t differ a whole lot on economy… both support the current economic system but would attempt to make some changes to make the system closer to their ideals.

The religious support or abortion rights or gay marriage etc. and others are not the basic differences between the two groups. They come into play for various reasons such as elections or due to common fronts that both parties create to garner support in other areas. Some of it is pure election politics.

Many conservative support abortion and many liberals oppose abortion. The basic difference is that the conservatives believe that the Supreme Court while voting for Roe vs Wade legislated from the bench thus usurping the legislators’ rights. They also consider Abortion a state subject and contend that the US Constitution does not support the federal govt enforcing the Court decision. The liberals support Roe vs Wade from the women’s rights pov and the religious right, being a one issue group, comes down with the conservatives based on their religious ideals. If Roe vs wade is overturned the fight would just move on to the States from the Federal level.

IMO, Roe vs Wade is not a liberal issue…it is more a conservative issue as it goes against the conservative principals of federalism and liberals don’t really have any ideological beef with the issue and only support it because abortion is an important issue for the women’s right movement in the US. Similar is the case with the gay marriages and gay rights. Hard core conservatives that run the conservative movement or support the Republican Party are not religious nutcases…in fact most of them are atheist and are neutral on gay issues but they may not support gay marriages. A good number of Liberals too don’t support gay marriage.

Paul Stiles is just one voice…there are many differing opinions on the economy and he is not the most influencing factor in that area so his opinion is just one opinion. Personally, I favor Judeo-Christian values playing a role in the society as a whole but I would not favor legislating them into the system.

Re: # 222

SR Sahib… Very valid reasons to leave the evil land. Good luck and good riddance.

#185 Pardesi {“…We ‘the faithful loyalists’… how this country will be reduced to minor role in the world and which other … countries will take over …”}

I’ll begin with expressly stating my “fondest admiration” of, and my “deepest loyalty” to, the Ideas, principles and aspirations behind the American Revolution of 1776. I hold the US Constitution as one of the most bold and enlightened political documents ever conceived my man. In short, I consider myself an ardent American in the pioneer spirit. I became an American by choice, not by accident of birth. I love America but I hate the present state of affairs so I chose to live in exile from my adopted homeland.

Please do not give me undeserved credit for having left the country on account of any high moral principles. No. I left out of fear. Fear of my personal future and that of my wife and children. But, of course, no one knows what future will bring. We only guess and estimate future outcomes aided by incomplete and uncertain information.

Like the former Union of the Soviet Socialist Republics, the “Union” of the current United Soviet States of America, may not last as a monolithic union. Some states, or blocks of states, may some day wish to free themselves from their federal shackles. This sounds absurd today, but when the stage is set it could happen quickly.

In 1980, the US was still the world’s largest creditor. By 1985 it had become a net debtor. This trend accelerated under Greenspan. Since Alan Greenspan took office on Aug. 11, 1987:

•Consumer credit has skyrocketed from $672.2 billion to $2.1 trillion (up 212%)
•Outstanding household debt has grown $2.7 trillion, to $10.764 trillion (up 298%)
•Domestic business debt shot from $1.9 trillion to $5.2 trillion (up 174%)
•Annual trade deficit has gone from $150.7 billion to $756.8 billion (up 402%)
•Total of foreign-owned U.S. assets has shot from $1.7 trillion to $11.5 trillion (up 576%)

As the author of the article points out, consumer spending cannot make people rich; instead, it makes them poor. You don’t get rich by spending; you get rich by saving…and building new businesses, new factories, and new and better products. You get rich by foregoing consumption in favor of production - so you can produce better automobiles, for example, than your competitors. But the United States has done just the opposite. It consumes…and allows its competitors to invest and produce. Where do you think this might lead the US?

This is not Relativity or Quantum Mechanics that simpletons like me can’t grasp. This is just plain common sense question…

Would someone hazard a guess? What could be the ramifications of these facts on civil society? What could happen to the law and order situation if the system experiences economic shocks and sporadic breakdowns? Did we see a glimpse of that post-Katrina? What could the bankruptcy of GM or the collapse of Fannie Mae do? GM, for instance, has a market value today that is not too far from $20 billion but has issued over $300 billion in corporate bonds. Who will pay those bond investors? They are not rich tycoons by the way. They are your pension funds.

2004 was also a watershed year. For 63 years the USA was like a magnet, attracting the world’s best “brains” to its shores. There was a net brain-gain, year after year, for 63 years. That, tragically, changed for the first time in 2004. For the first time in over six decades there was a net brain-drain from the US. Why? I believe because the USA has become the USSA (insert the extra “S” for Soviet)… Government of the Corporations, by the Corporations, for the Corporations. (The term fascist is more appropriate, but Soviet rhymes better and invokes the image.)

The media mold the mind of man today. Those who can exert subtle influence and effect policy can alter history. No one ever prove anything. Even pointing out strange and suspicious connections earns one the label of a conspiracy theorist.

Take Donald Rumsfeld for example. In 1997 he became chairman of a company called Gilead. Even today he holds millions in the company stock. Gilead has a patent on a drug called Tamiflu. Its an anti-viral drug. Yes, the same Tamiflu we are told will flight off the dread Avian Flu… and is produced by Roche. Roche is the licensed manufacturer of the drug, not the drugs owner. Gilead owns Tamiflu, yet the news media only talk about Roche. No one mentions Rummy. Is this a co-incidence? Maybe it is. Maybe not.

There are too many questions... few straight answers. Being complacent and unquestioning is only done at our personal and collective peril.

...SR

Simon_Templar have fished out some excellent ideas out of this ... well, that in itself is something and by the way ST dude, this was not atrocious - had it been written with a little more clarity, you would be prolly the only one using the excellent word.

Saima Shah:
before goading Left and the entire shabang, could you please clarify what are your personal positions on a woman`s right to choose and on according Equal civic rights to gays and lesbians - specifically: gay marriages and adoption issues?

Thanks.

Excellent ideas. Atrotious writing. It should`ve gone through rigorous
editing before being splattered on the FP.

Now that FV is the editor, maybe things will improve.

SaimaShah #210

`` 1.I think the struggle should no longer be classified as between the liberals and the conservatives. New polarities should emerge --. In the last few years one notices an odd thought similarity between the Christian agenda and the left. Democrats get excited at this and jump up and down thinking that the world has seen the error of its ways and will accept what the Left has to say, since it is really speaking for the common man. In the last elections, this hope was dashed because the Republicans successfully divided any alliance between the Left and conservatives generating controversy over abortion and homosexuality. ``

A lot of social conservatives are economic liberals. A lot of social liberals are fiscal conservatives. There is nothing new about it.

`` For a take on how religion can align with the left, see ``Is the American Dream Killing You?` by Paul Stiles. Paul Stiles was a stock trader who sees religion as the antithesis of the market. From Washington Post, ``Lamenting that the market ``has deeply penetrated our national identity,`` Stiles recommends an economic exorcism, one that should trouble anyone concerned with the establishment clause of the Constitution and the separation of church and state. He proposes a market ``restrained by Judeo-Christian values, as codified in law and represented in democratic institutions.`` This is ``a recipe for social success,`` he claims, ``the very recipe that made America.`` ``

Most free marketers do not call for unrestrained capitalism. Most of them agree for the need for rules. Anti-trust legislation is one of the prime examples of such rules.

`` To quote Bill Grossman, ``the ratio of retirees to workers - the dependency ratio - soars from 0.2 retirees for every worker to 0.35 over the next 20 years or so. Neither privatization nor any goodly number of government bonds deposited in the Social Security trust fund can solve it. While these paper assets may ``pay`` for goods and services, their value will be market adjusted in future years to exactly match the quantity of things we buy, and that quantity will be substantially a function of the available workforce and the price they command for their services. This is a concise way of saying that the value of Treasury bonds and even stocks will be valued down in price as they are sold to pay for future goods and services, and that the price of these goods and services will be marked up (inflation) to justify their reduced supply. ``

The demand for goods and reduction in the supply of labor is a good incentive to automate the delivery of services and the manufacturing and distribution of goods.

#217, Apni ghaleeJ Jaban ko aisy jagah ghuseRdo jahan shams ki koi parwah na ho.

Re: # 216

Wah! Just like a cowardly man-hides behind yet another anon nic, and when exposed for his stupidity, acts as if he is actually worth something...

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