I wanted to title it something even less flattering. Really. I shed the first three titles that came to me because they sounded, on their face, unkind, and too personal, things I criticize and rebel against in a media and political culture too fixated on insults and personal attacks. And, besides, a title is just an entrance to what you want to say. And "Not What I Thought" is a more than adequate entrance.
Still, I think it could, on substance, quite rightly be titled "Promises To Break" (sorry, couldn't help the take-off on the title "Promises To Keep" of Joe Biden's book which came out just as he started running, unsuccessfully ultimately, for President). And, literally, part of what I want to communicate is captured by "Not As Smart As I Thought", though that is clearly inaccurate, in that, from an IQ standpoint, he's probably every bit as smart as I thought. So, "smart" is not the right word. "Correct" or "Wise" are probably closer.
So, you can see I'm fishing around. Spending, so far, my first two paragraphs critiquing my own title tells you that what I am really trying to get across is a compendium of dissatisfaction that no one title fully conveys.
And I have to get on the road before the rest of the world does on this holiday travel Monday; so let me cut to the chase.
The economy is stagnating and Barack proposed yesterday to take another $30 billion loan from China, which she shall certainly grant, and use the borrowed funds to build infrastructure, much needed in this country after years of neglect and shortsightedness, mainly roads, bridges, and rail lines, as a Keynsian injection of cash into the economy, banking on a multiplier effect, of course, and a resulting jumpstart to the private sector which the private sector will then sustain beyond the period of government spending on infrastructure.
Those are all Keynsian notions. Keynes was a great economist, and his philosophies certainly influenced Roosevelt's decision-making during the Depression to borrow (and that time, not from China, but the American people, so it was they who earned the interest, and the repayment) and spend in order to accomplish the same ends back then.
The trouble is, though there is a Nobel Prize for economics, as with physics, its formulas and theories are not as clear cut, clearly provable, or disprovable. There are certain principles of economics (not Keynsian, necessarily, but any strain), like supply and demand, which hold true under certain assumptions - usually assumptions of "perfect" competition, when very rarely does that exist, meaning the principles themselves are defeated somewhat by the lack of meeting those assumptions.
The relationship between supply and demand is far simpler however than the Keynsian principle of multipliers, intuitively, as well as in reality. Various assumptions need to hold. And intuitively the concept is very difficult. The principle basically says this. First of all, note that GDP (gross domestic product) is like the nation's salary for one year. It's what the nation "made", earned, collectively. All of us. Well, the multiplier says that if the government spends $1, then GDP goes up. How much up depends on the size of the multiplier. But the basic concept is this: if the government spent money, cash money, on things like bridges, roads, or whatever, then the nation got richer. Its "salary" went up. The amount the U.S. collectively earned from all of our collective efforts increased. America, in effect, got a raise.
Intuitively, you think, "Well, didn't it just get shifted? I mean, the government doesn't 'make' anything, right? All the money the government gets it gets from us, right? We make some money, and then give the government some in taxes. But it's a 'zero sum'; that is, we made less than otherwise, and the difference went to the government. So, then, if they spend some of what we gave them, they just moved that money again to someone else. Perhaps a bridge construction company. But they didn't create any 'new' money, right? America did not get a 'raise', right? In fact, if the government borrowed the money not from the American people, but from a foreign country, where the interest on the loan will then leave our country for distant shores, then didn't that government spending actually 'cost' us money collectively, and make us collectively poorer, quite literally?"
A Keynsian economist would try to tell you, "No, no, and no...." My point is that a non-Keynsian would counter with "Yes, yes, and yes...." And because it's economics, and not physics, no laboratory test would prove conclusively one right and one wrong.
If those two people were witnesses in a civil case, as the jury, you'd have to throw out both of their testimony as equally compelling and directly contradictory. In other words, one argument annihilates the other. Matter and anti-matter, for you Star Trek fans. What's left is the absence of both arguments.
So as respects Barack's plan to spend another $30 billion, what do we know for sure about it? We know for sure he is not going to ask us, the current taxpayers, to pay for it. So we know he's going to borrow it. And he's going to borrow as he and George W. Bush before him borrowed all their money - the sale of T-Bills to foreign governments, mostly China. So we know he's going to borrow it from China. We know that increases our already historic debt and deficit. We know the interest on the loan goes to China. We know all of that for certain.
We know, therefore, that the proposal is this - that young people, many of whom are too young to vote, or even aren't born yet - shall repay the $30 billion plus a considerable interest (by the time it actually gets repaid) out of their lives. This is a sacrifice. He is asking it of them. Actually, he's just telling them, because they can't vote. He is telling them to sacrifice for their country. More explicitly, he is asking them to sacrifice so that their parents might get a job, if currently unemployed, or have higher incomes now, because the tax being taken from them is $30 billion less than what it would need to be to pay for the infrastructure spending now. Moreover, he is asking those congressmen and senators who represent those parents, and the parents themselves on whose vote those congressmen and senators are relying to get re-elected, he's asking all of them to live better now so that their children may live a more impoverished life later.
When did that become America's creed?
Screw your kids.
I'm am usually far, far from that blunt. But $30 billion in borrowing to make life a little easier now is $30 billion which makes life worst later.
Unless you believe Keynes, and you assume a high enough multiplier. If you do then $1 of spending by the government does not make us poorer (I guess the $1 is interest-free); further, the $1 is not just a shifting around of $1 a taxpayer gave the government, with a net effect of $0 change in America's income. Nope, neither of those. What you believe is that $1, which you have the government, and it then spent on a bridge, created $2 of earnings for someone else (if the multiplier is 2.0) or $3 (if the multiplier is 3.0, etc). Now, how it's possible that if someone gives you a dollar and you give it to someone else, that somehow or another and extra dollar (totaling $2) was created in the transaction, is exactly what constitutes Keynes' multiplier theory. But it's a very tough sell, is all I'll say.
Under that theory, if we can just borrow enough from China, and if the multiplier is high enough, the gain from the multiplier effect will be large enough to pay back the loan and the interest.
Who out there thinks that if we just borrow more, we can somehow completely pay off past borrowing with the Keynsian multiplied gains of the new borrowing?
Like I said, it's a very tough sell. I don't agree with it, obviously.
I think Keynes got that one wrong. I think someone will figure out, tough as it is to prove anything in economic theory, that the theory was fatally flawed. Some smart person will do what smart people are often needed for - to prove something we, the less smart, knew intuitively to be the case.
And I'll finish now. Here's why I say, "Not What I Thought". I didn't think he was going to indebt the unrepresented like he did. I didn't think the congressmen and senators representing the parents of the unrepresented would be rewarded with votes at the ballot boxes by those parents of the unrepresented. I didn't think this generation - given our great history of each generation taking on the awesome responsibility of leaving a better country to their kids than they inherited - would so openly, and easily, and repeatedly, time and again and again and again so pervasively and knowingly and callously screw their kids - people with no vote of their own, and therefore no political power, and totally dependent on their parents, and their President, and their government to support public policies which will make their lives better, out of a historical tradition to do just that.
No young person should approve of their parents' politics if they support this President, or support congressmen or senators who support this President.
I am among the represented, and I deplor what this President is doing - attempting to live better now, so that later generations can suffer. LIving better at their expense. Barack Obama needs to lose re-election. Democrats need to be represented by possbily Hillary Clinton or anyone repulsed by the notion of sacrifice NOW for the benefit of our children later. It's what the Depression era did. The Greatest Generation. The generations subsequent are proving to be The Greatest Embarrassment. And this President is demonstrating his membership, his inclusion in those generations. This is not "change". Not all all. It's all too sadly the status quo. It's Reagan. It's truly everything since the era of Eisenhower, Kennday, Nixon. Those presidents close a chapter. To do as they did fiscally would be "change". To do as they did in terms of investment in this country would be change (Kennedy: space; Ike: interstates; Nixon: opening of China). To follow the already $700 billion stimulus the way Barack is by asking for another $30 billion is not change. It's a change in national attitude from sacrifice to indulgence. Barack is going to attempt to indulge in another $30 billion from those who can't vote. Just watch how many of their parents...and congressmen and senators...respond with, "Amen, brother!...it's about time, because my employment is about to run out," and all array of similar reasons.
This is a present. He is requesting it from them. In fact, he's in the process of telling them, on the grounds that they lack the capacity to vote. He is telling them to offer for their nation. More unequivocally, he is inquiring to relinquish so that their folks may get an occupation.
Posted by: writer jobs | August 25, 2011 at 04:58 PM