Fiddle or Fight While America Burns?

I hang out on Facebook a lot. More than I should, actually, although I've decided to back off on it over the coming days. But I read a post today from one of my Facebook friends in which she says she's tried of all the doom and gloom that people are spreading about America's alleged decline, and she's going to stop listening to them and get on with her business.

She thinks that we certainly have problems, but bright minds and natural cycles will solve them unless and until we allow ourselves to become so obsessed with the dire and unflaggingly repetitious pronouncements of such pompous prophets of doom as Paul Krugman, Robert Reich, and Tom Friedman that we become too demoralized and debilitated.

I disagree with her. I think our problems are very serious and that we have no chance whatsoever of solving them unless we begin by acknowledging and understanding them. This, with some minor modifications, is what I wrote to her:

I don't believe we are "functioning well" at all. Wall Street continues to grow richer while Main Street continues to grow poorer and our infrastructure continues to crumble and collapse before our eyes. Our educational system is in shambles at a time when it desperately needs to get its act together. Our political system is so polarized that very little can be accomplished. Health care is becoming more expensive and so-called Obamacare, a piss-poor patchwork substitute for single-payer but still better than what we've had before, is on its way out as Republicans continue to attack it and Democrats continue to cave to their demands. Our national debt continues to rise with no viable prospects for reversal. Soon China will be the world's dominant technological, economic and geopolitical power if it isn't already, and India and other rising countries such as Brazil may also relegate us soon enough to second tier, has-been status while our only preeminence, at least for a time, will be as militarily musclebound freaks.

These and a million other serious, serious problems eat away at our nation, and whether you want to collectively characterize them as "brokenness" or to use some other, more euphemistic term for them, they are real, and they are destroying us from the inside out while other countries chip away at us from the outside in.

If we acknowledge and understand our problems, there's always the risk that we'll succumb to debilitating and paralyzing despair and not only sink into the morass of mediocrity or worse but be miserable the whole way down. But if we don't acknowledge and understand our problems and just "fiddle while Rome burns" (pardon my mixed metaphors), expecting everything to right itself as part of some natural and inexorable cycle, we have no chance whatsoever.

The choice is ours. Fiddle or fight.

Quote for the Day--Obamanomics is Not Keynesian

"The way the right wants to tell the story — and, I’m afraid, the way it will play in November — is that the Obama team went all out for Keynesian policies, and they failed. So back to supply-side economics!

The point, of course, is that that is not at all what happened. A straight Keynesian analysis implied the need for a much bigger program, more oriented toward spending, than the administration proposed."

--Paul Krugman

Searching For a Way Through It All

These are scary times economically. I want to believe that things won't get too bad, but it's a struggle when knowledgeable people such as Paul Krugman, Thomas Friedman, and Robert Reich keep telling us how apprehensive they are.

Then there are the real prophets of doom such as Gerald Celente. He ominously predicts the imminent end of the world as we know it or, at least, of the United States as economic chaos inexorably engulfs us in the worst depression any living person has ever seen and produces catastrophic unemployment, poverty, hunger, and mob violence.

When I first heard Celente speak on Coast to Coast AM, I thought he was some kind of crackpot, albeit an articulate one, gearing his message to a listening audience filled with crackpots. But then I found out that respectable people take his economic and social forecasts seriously.

Then I read articles like this in Robert Reich's blog about how the leaders of the financial institutions and the "Big Three" auto manufacturers believe that our economic woes are less the result of bad business policies than they are of inevitable economic cycles and that as soon as the current situation improves, they will return to business as usual if we let them. Reich writes:

Right now, Wall Street and Detroit are willing to say whatever they need to say to keep the taxpayer money coming. But when the economy begins turning up, my betting is that their Washington lobbyists will push back hard against any major restructurings the government wants to impose on them. New regulations of Wall Street will be watered down and circumvented; new requirements on the Big Three for green technologies will be resisted.

Yet the bailouts have been sold to the public as means toward fundamental change in finance and autos. If the bailouts are to do what they're supposed to – stop Wall Street from wild risk-taking with piles of borrowed money, and push the auto industry into making fundamentally new products that conserve energy -- Washington will not only have to set strict standards now and in the months ahead when the bailout money flows, but also hang tough when the economy begins to revive.

I read things like this, and my hopefulness suffers further decline. For even if we manage to climb out of this economic mess before too long, it sounds to me as though the policies that got us here will resume, and we'll find ourselves in another and possibly worse mess before terribly long. Either that or these economic upheavals really are cyclical and there's nothing we can do to prevent them. Neither prospect instills optimism.

Yet I try to remain optimistic that, individually and collectively, we can find our way through these trying times and learn enough to prevent or, at least, delay and soften future ones. I'm looking to find my way.

Quote of the Day

Let Michael Moore point out, entirely correctly, the close ties between the Saudis and the Bush family, and he’s blasted as a crazy conspiracy theorist. On the other hand, let Donald Luskin suggest, in 2004, that George Soros is planning to engineer a financial crisis to defeat Bush, and he gets to publish front-page articles in the Washington Post Outlook section declaring that there isn’t a recession.
--Paul Krugman

Quote of the Day

Seriously, we are in very deep trouble. Getting out of this will require a lot of creativity, and maybe some luck too.
--Paul Krugman

Cat Wins Nobel

From Paul Krugman's blog.

Economic Double-Think

There's kind of a weird double-think involved in arguments that the slump should be allowed to follow its natural course. It's true that classical economics says that we should let market forces do their work; but classical economics also says that severe recessions can't happen. This idea that we must not intervene is based on a worldview that is refuted by the very fact that the economy is in the mess it's in.
--Paul Krugman

Quote of the Day

I’ve been ruminating over economic prospects for next year, and I’m getting scared.
--Paul Krugman