Comments on: Institutional failure week http://blogs.reuters.com/great-debate/2010/11/02/institutional-failure-week/ Thu, 21 Jul 2016 07:57:19 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: Pred http://blogs.reuters.com/great-debate/2010/11/02/institutional-failure-week/#comment-33356 Thu, 04 Nov 2010 15:13:48 +0000 http://blogs.reuters.com/great-debate/?p=8527#comment-33356 Ron Paul is trying to downgrade power of FED and in yesterdays interview said: ‘If we succeed in Congress/Senate to challenge the power of FED significantly (what he suspect is not possible right now) ANY president would veto such decision’. Scary conclusion about real FED power. People and their representative including president cannot stop harmful actions of private cartel in any ways? Good morning America.

]]>
By: pdfernhout http://blogs.reuters.com/great-debate/2010/11/02/institutional-failure-week/#comment-33333 Wed, 03 Nov 2010 17:59:17 +0000 http://blogs.reuters.com/great-debate/?p=8527#comment-33333 The US GDP grew by 40% in the past decade. The net job growth was zero. Even with GDP as a problematical indicator of social well being, this should give us pause in thinking about whether our assumptions related to economic growth are either complete or correct.

The USA would need about thirty million net new jobs by the end of this decade to bring us back to where we were in 2000 (so, jobs in addition to ones that will be eliminated by continuing productivity increases). This is probably not going to happen in the USA. Can anyone say where 30 million net new jobs are going to come from in the USA, especially given the growth of the productive sector in other countries? If so, that’s a great investment opportunity of a lifetime.

What will the USA be like after another decade of 40% GDP growth and 0% job growth, with a continual increase in population? Or worse in terms of unemployment, what if GDP stayed flat but productivity still rose by, say, 33% over that decade? With a new Congress unwilling to support new taxes and new social spending, we may see vast unemployment and vast social turmoil if productivity continues to rise and demand stays weak.

Sure, we may see some millions of new green energy jobs, but ultimately they will just replace a lot of old fossil fuel jobs, so I doubt there will be a “net” new job among those. Likewise, we’ll see some new green design jobs, but they will just replace lots of old inefficient manufacturing jobs with better designs that can be made more easily. We’ll probably see a net decrease in medical care jobs, even with an aging population, as all sorts of new (old) medical wisdom backed by scientific studies percolates through our society (like about curing vitamin D deficiency and about preventing disease by eating whole foods like vegetables, fruits, and beans) and as we start importing the robots Japan is developing to care for its aging population.

Our society is in a phase transition towards a new socioeconomic paradigm. I agree with James Saft that the housing debt bubble only obscured a fundamental shift that no one wants to think about which started a decade or more ago. But reality is sneaking up on the USA, and a high unemployment rate is one undeniable aspect of that new reality of limited demand for consumer goods (between environmentalism, voluntary simplicity, and business/credit cycles) alongside continually rising productivity (through robotics and other automation, better design, and voluntary social networks).

Possible ways forward include amplifying our current alternative approaches, like:
* moving from social security and medicare just for the old, and school payments just for the young to a true basic income for every citizen that they spend as they want (to provide predictable demand),
* moving from a haphazard volunteer sector and free software movement to a robust gift economy,
* moving from some local economic activity promotion (like with Ithaca HOURs) to stronger local subsistence communities everywhere in a more coherent way, and
* moving from a complex biased tax code to more transparent democratic resource-based planning to account mainly for market externalities using taxes, subsidies, investment, and regulation (so, perhaps less government, but government with a mission to address market failures).

I have more details on that here:
http://knol.google.com/k/paul-d-fernhout  /beyond-a-jobless-recovery#Four_long%28 2D%29term_heterodox_alternatives

Ultimately, the “institutional failure” is the failure to consider that a fundamental paradigm shift is occurring in the USA, one that has been predicted by many pundits for decades, even as it has been obscured by many other trends for a time.

]]>
By: S_K_V http://blogs.reuters.com/great-debate/2010/11/02/institutional-failure-week/#comment-33332 Wed, 03 Nov 2010 17:52:24 +0000 http://blogs.reuters.com/great-debate/?p=8527#comment-33332 I wish you wrong, but unfortunately you are precisely correct.
The problem is deeper:
US labor cannot compete with cheap labor from China, India etc. Our final labor cost includes cost of benefits (medical, retirement, vocations etc). They just don’t exist in China, India. Rather than covering the gap in cost by borrowing money US gov should assume medical cost it also shout impose ‘benefit tariff’ on import from countries with cheap labor.

]]>
By: saucymugwump http://blogs.reuters.com/great-debate/2010/11/02/institutional-failure-week/#comment-33331 Wed, 03 Nov 2010 17:12:49 +0000 http://blogs.reuters.com/great-debate/?p=8527#comment-33331 James Saft wrote: “the economy and market are becoming fundamentally disconnected.”

It is comments like this that make Saft my favorite Reuters columnist. He gets it. Wall Street and Main Street used to be joined at the hip, but outsourcing and Wall Street bailouts changed all that. Now the Dow can climb to the stratosphere, while unemployment remains high.

James Saft wrote: “the next two years will be spent dickering over tax codes”

Neither party is willing to curtail outsourcing. The Democrats are only marginally better at limiting Wall Street’s drunken orgy of greed. So gridlock might be a good thing, as few laws will be passed.

James Saft wrote: “Think of all the start-ups that never got funded or started because money was flowing to marble counter tops and construction”

And think of all the start-ups that never got funded because all of our money was being shoveled into Wall Street.

http://saucymugwump.blogspot.com/

]]>
By: edgyinchina http://blogs.reuters.com/great-debate/2010/11/02/institutional-failure-week/#comment-33323 Wed, 03 Nov 2010 11:58:03 +0000 http://blogs.reuters.com/great-debate/?p=8527#comment-33323 Good Night America. Institutional failure ‘week’??? I hope this failure doesn’t last 20 years like ole Rip V.W’s slumber…. And when we finally awake, I hope our head has been cleared, and we’re not just suffering another hangover.

In the immortal words of Edward R. Murrow; Good Night, and Good Luck…

]]>
By: ma2416 http://blogs.reuters.com/great-debate/2010/11/02/institutional-failure-week/#comment-33318 Wed, 03 Nov 2010 10:11:41 +0000 http://blogs.reuters.com/great-debate/?p=8527#comment-33318 Gentlemen,

Everywhere we say that Fed / WBank and Policy Makers did this wrong or did that wrong .

But I havent come accros an article which says whats needs to be done to fix the problem of US and of Developed Economic situation in terms of Unemployment / Inflation , Currency and BOP Issue

Unless the Intellectuals , Free thinkers and Economists start to think and write about it policy makers will keep a deaf ear and will do according to their voting mandates.

Regards,

Ahmed

]]>
By: pHenry http://blogs.reuters.com/great-debate/2010/11/02/institutional-failure-week/#comment-33298 Tue, 02 Nov 2010 19:34:01 +0000 http://blogs.reuters.com/great-debate/?p=8527#comment-33298 Edward, it is going to be both whether we/they like it or not. Most legislation can be reversed if needed. But that isn’t always accurate in itself. So some times in a rush, we throw out the baby with the bath water. For instances, what exactly do opponents of healthcare have in mind? Where do opponents of bailouts draw the line? If incumbancy is the problem, how many terms should we be limited to and how often should we have to choose? “the will of the people” misleads us by believing apathy, ignorance, greed and self-centers take election day off. Many good Democrats will lose today. What hurts us most is the knee jerk reaction to reforms which were designed to emerge rather than explode as if ectasy. Obviously some adjustments should be expected but this constant teeter totter causes a lot of stampedes.

]]>
By: edweirdness http://blogs.reuters.com/great-debate/2010/11/02/institutional-failure-week/#comment-33294 Tue, 02 Nov 2010 18:44:51 +0000 http://blogs.reuters.com/great-debate/?p=8527#comment-33294 So which is it? Are we to continue the unsustainable policies of an increasingly unpopular administration, or are we to allow the the will of the people have some say in what’s going on? I am unable to determine whether yours is a denouncement of the voters will, or whether it’s your view that the great unwashed masses are simply too stupid to conduct their own lives. It occurs to me that our nation was founded from a will to end the oppressions and usurpation’s of the elites and their pet bureaucrats. Doubtless there is truth in the fact that Democrats and Republicans alike place their own self interest before that of the citizens. However; when such self service defies the interests of the voting public, these politicians must be removed, either at election, or through proximate recall by the voters. No one said this was going to be easy, and it serves us all to recognize that it’s not all about business and corporate interests, but rather the unwillingness of both to accept the will of the people.

]]>
By: yr2009 http://blogs.reuters.com/great-debate/2010/11/02/institutional-failure-week/#comment-33293 Tue, 02 Nov 2010 18:18:04 +0000 http://blogs.reuters.com/great-debate/?p=8527#comment-33293 “Think of all the start-ups that never got funded or started because money was flowing to marble counter tops and construction.
On the flip side, think of all the companies that should have failed but didn’t, kept alive by low rates and easy money.”

Precisely.
No one could have said it better than you, James.

Over the years, the US economic system has been corrupted and perverted.
The Fed must be reformed, as well as the tax code.
No more free money, and no more subsidies.
The system is sick – This is not about a recovery, but about healing.

]]>