Letters to the Editor
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You've missed the boat
Most people have missed the boat and woudl rather hear the fluff.
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Response to moira kelly
Ok, but the political party that is most aligned with gun owners and gun ownership is the party that has done the most towards dismantling whatever safety net was in place for Americans. Perhaps those that can be convinced that cutting the estate tax to benefit the Paris Hilton is a good idea by calling it "the death tax" and wrapping it up with a "God, Guns, and Gays" social issue smokescreen deserve what they get.
If an economic collapse leads to a New New Deal, would that be bad from a safety-net perspective? If not why fear a readjustment.
Americans have been living beyond their means for at least 20, if not 50 years. We can't necessarily keep this up--the world is getting sick of financing our profligate ways, the dollar as a reserve currency is in jeopardy, and we are in danger of oil producers disconnecting the price of oil from the dollar.
I'd say we should retrench before it is too late. And if that means that people can't make it with the way things are, perhaps they'll start voting in their own economic interest instead of falling for warmed over trickle down economics over and over again.
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Saving is great...
But you can't save without making some wages. The fact is that the cost of living is increasing at a rate larger than the wage increases for middle to middle lower class workers. When making 60-100,000 a year is considered "middle class", you know we have a problem in this country. we can't all be lawyers and Harvard PhD's.
If I were a conspiracy theorist, (and I'm not), I would say that there's more than a little collusion between credit card companies (who incidentally give capital for commercial investment) and employers to keep wages down, to stimulate credit card usage, to keep wages down. which is another side effect of outsourcing jobs, it forces domestic wages down.
Yes, many americans are spending beyond their means. But many americans are spending what they need to get by, and they're not saving near enough, not because they're buying big screen TV's, but because they're just squeaking by.
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Fixable?
"The economic, social and political model of the U.S. has developed serious albeit remediable flaws and needs major surgery." - HTWW quoting an economist.
How? With only 10% of the economy being manufacturing (i.e. something that "creates" wealth in the capitalist system) there isn't a lot of wealth creation available.
You'll have to go to some lengths to convince me that the "service economy" generates wealth.
So then - how do we make manufacturing 40% of the economy again? That is the only way I know to "fix" the current problem.
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So we need our own Herbert Hoover/IMF?
That's what it sounds like from the FT guy. Strangely how impervious these people are to empirical results.
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The Drug War
Silenced, it's obvious you're not satisfied with Salon's coverage of drug issues. I'd suggest you go elsewhere to find it, rather than constantly posting tangentially-related drug topics and finishing with "Oh, I forgot. This is Salon."
However, accepting your numbers as accurate, I would point out that the US GDP is something like USD14.1 trillion. McDonalds had a revenue of USD5.75 billion in the last quarter of 2007. Adding another McDonalds to the economy is nowhere near a solution.
I'm not disputing that the US should rethink its drug policy, but do try to be reasonable in your estimation of its impact.
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It is to laugh!
So now the refrain 'Americans must save more' will replace the mantra Buy! Buy! Buy! That just might be a difficult sell when the Fed implements policies that make the return on savings minuscule. While my more adventurous peers, enabled by shall we say 'inspired' financing, moved into fancy-pants houses, I remained in my 30-year-old manufactured house (more disparagingly called a trailer) and methodically built up savings in a credit union. Until recently, the interest paid on one-year certificates of deposit was laughable, this sad state of affairs of course being a result of the Fed dropping the prime rate into the cellar so as to encourage people to. . .wait for it. . . borrow more. In the last year, the return on savings finally rose to a reasonable level. Betcha this will be a phenomenon of short duration.
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I'm for taking the medicine, I guess, but...
A little fiscal responsibility would be a great idea in my personal finances, so I feel like it would probably be a good idea at the macro level, too. My only question is tied to something Andrew's covered before- the interconnectedness of our economy and China's. It was discussed that China wouldn't be likely to torpedo our economy by dumping all those treasury bonds, because a dive in our economy would have a dire effect on theirs, leading to a lot more unemployment, hunger, unrest, etc. If we slow our own economy down, what does that do to the emergent Asian economies?
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Silenced
No, spending money on those things is not wise, and I do think legalizing drugs is an option we should consider. I also am suprised you left out another huge cost you usually mention: The cost of incarcerating so many for so long over essentially nothing.
Even though so much is wasted on these things, that's not going to revitalize the economy by itself. Just stopping the expense of the War in Iraq would be a bigger source of funds. And it won't happen overnight, even if it is determined that it makes sense. There's a LOT of legislation that'd need to occur.
However, this is your response to everything. And if it doesn't really have any bearing on the subject, you just complain about how no-one talks about it. At this point, you could just post your screen name and everyone could fill in the blank.
You've always struck me as intelligent enough to sing more than this one note. I'd love to see it.
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Something that is missing from this discussion.
What exactly is meant by terms such as "us" and "we" when we discuss sacrifices that should be made for the long-term betterment of the nation? For the last 30 plus years, the GOP and the inherited wealth crowd have sought to weaken class identity, and replace it with an identity of the individual. It has resulted in a country of every person for herself. After all, if no one owes me anything, I certainly don't owe anyone else anything.
They have privatized the wealth of the nation, and now seek to socialize the costs of fixing our problems. And they wish to do it on the backs of those of us who have spent our whole lives sacrificing - and being sacrificed.
As I wrote, Mr. Buiter needs to spend some time in the US - away from his rich buddies. He might gain some understanding of why the US economists will do anything to delay a day of reckoning.