Economic Politics

“Would somebody please explain when they started putting drugs in our water?

The bleating mantra of the economically conservative (: tending or disposed to maintain existing views, conditions, or institutions) labor unions, and their supporters, in the 80’s was, “Be American, buy American.” People didn’t listen. They bought cheaper and better built Japanese cars. This free trade philosophy didn’t hurt our economy then, or in the 90’s. So why do we hear the same tired bleating from the economic conservatives such as Kerry, and his supporters, today?

There aren’t many blacksmiths, tailors, cobblers, or coopers in this country today. They can't compete. The only constant is change. Does anyone here actually believe in the long-term economic advantages of protecting jobs in this country? And how best should government go about CREATING jobs without controlling the means of production?”

“Fuego! Fuego!”

“Wow, arclite shows up. I see an arc v. Buddha cage match.”

“I actually agree with Arclite.... wow - it's quite upsetting.

It's not nice to see jobs go, but not much can be done about it. US will find new ways to compete. Protectionalism isn't the answer.”

“I'm dealing with it right now. WE simply decided to outperform the offshore competition in customer attention and quality.

Ya get what ya pay for.”

“Protectionalism? Stop ripping off words from George Bush.”

“college doesn't look like it will be the answer to losing your job. We are already graduates. So what job should we be retrained for? Government service? Army, navy, air force, marines? hamburger flippers? oh Border Patrol. If protectionism won't work, what job should all of these white collar IT, manufacturing, and money laundering,,,uh i mean stocks and bonds traders workers be trained for? Where are the jobs going to be, i guess is what I'm asking?”

“The only thing I would really like to change is the missing workers rights and envrironmental protection clauses in our free trade agreements. If those are there, Americans can better compete on the world market.

Other than that, if we make no advantages tax-wise for sending jobs overseas, I'm all for the competition in the markets.”

“missing workers rights --the what? you wanna change it?


envrironmental protection clauses--t5he what? you wanna change it?


if we make no advantages tax-wise for sending jobs overseas--the what? what is meant by this?”

“I have mentioned before that this economic campaign strategy is very much like McGovern's. Back then it was the Japanese and Germans. Now it is the third world.”

“RELYING ON THE STUPIDITY OF THE GREAT AMERICAN VOTER

One of the saddest aspects of this and so many other election years is the degree to which politicians rely on the stupidity and ignorance of the American public. The more you watch these clowns the more convinced you are that they truly fear an informed electorate.

This is particularly true among Democrats. Disagree all you want, but Democratic politics is crafted to appeal to less educated Americans. The lower your level of educational achievement, the less you earn when you enter the workforce. The less you earn the more likely it is that you will vote for a Democrat.

One thing that Democrats definitely rely on is the ignorance of average Americans as to basic economics --- an ignorance that borders on obscene. This ignorance is the result of our reliance on government for educating our children. The natural imperative for any organization is to grow stronger. Institutions will not intentionally weaken themselves .. nor will the people who live or feed off those institutions. Government is no different. It wants to grow, and it will construct and direct every entity over which it has control to promote that growth. This goes for government schools. Students who learn of the dynamic nature of capitalism and free enterprise will seek more economic freedom and less government economic involvement. Students who learn that allowing people to keep more of what they earn will actually spur economic growth will fight higher taxes. Students who learn that 80% of new jobs in our economy are generated by small businesses, not large corporations, will seek government policies that are favorable to small businesses, not policies that punish them.

Politicians understand the consequences of an economically literate voter base. That's why they rally to the defense of government education. It protects them.

Now ... let's discuss a specific politician ... The man of the people, John Kerry. If you want a good example of a politician exploiting the ignorance of the American people, you got just that at a gas station in San Diego yesterday. The media says that sKerry made an "unscheduled stop" at this gas station. I have a question for the media: If this stop was unscheduled, why were there a hundred supporters waiting for Kerry at that particular gas station? Oh well .... let's continue.

There was John Kerry -- at that gas station -- blaming the current gasoline prices on none other than George Bush and Dick Cheney. Kerry knows that people are upset with these prices .. and he also knows that these government-educated voters have no clear idea why these prices are high right now.

What would the well-educated voter know? Well ... here's a partial list of the reasons for high gas prices.

There is a higher demand for gas in the U.S. American consumers are using more gas this year than they have in many previous years, even with the high prices.
Environmental regulations lower the supply base of gasoline available to consumers. Oil refineries have to switch production at this time of year to boutique gas blends for specific geographical regions. This means that if there is a shortage driving prices up in one region supplies can't be shipped in from another region to meet demand ... wrong blend.
We have about one-half the number of oil refineries in the United States that we had 30 years ago. The last time a new refinery opened for business was in 1976.
There is an unexpected high demand for petroleum in China. Some think that China may be buying huge supplies to build a strategic reserve.
Saudi Arabia has cut production. There is speculation that Saudi Arabia is recognizing that its reserves of crude oil are running out. Saudi production may never again reach previous highs.
The gas prices we face right now are not record high prices. In the early 1980s a gallon of gasoline cost about $2.90. That's adjusted for inflation, of course, but so is your income. Tough for government school graduates to understand, I know.
Now .. if you are a consumer aware of the foregoing facts, how likely is it that you're going to nod your head in agreement when John Heinz Kerry starts blaming Bush for the current high prices?
An educated voter is not John Kerry's friend.

Another area where Democrats rely on voter ignorance is in the area of jobs. John Kerry loves to talk about all of these jobs being shifted overseas and how he is going to punish all of those "Benedict Arnold CEOs" who are overseeing the decimation of the American workplace. Could Kerry get away with this if the voters knew:

From 1993 to 2002 the U.S. economy created a total of 17.8 million jobs. During that time 310 million jobs were eliminated, and 328 million jobs were created.
The new jobs being created are not "hamburger flipper" jobs. The Bureau of Labor Statistics estimates that between 2002 and 2012 management positions in business, finance and other professions will grow from 43.2 million to 52 million. That's a 20 percent increase. These professional positions will go from 30 percent of our total employment to 31.5 percent. That's not flipping hamburgers.
"Offshoring" jobs has actually contributed to job and economic growth. Take computers, for instance. A recent study by the Cato Institute shows that the offshoring of computer-related manufacturing jobs has accounted for a reduction in computer prices in the U.S. by as much as 30%. This means that more small businesses can afford these computers, and larger businesses can afford more of them. This leads to more jobs and increased productivity. Estimates are that this rapid spread of computer use has added $230 billion to our GDP.
Now ... if more Americans were truly clued-in as to what is happening in our jobs picture, do you think sKerry could get away with his rhetoric? Not a chance. Again ... the uneducated voter is Kerry's pal.

Are you beginning to see why it is so important to so many politicians that our system of government non-education be preserved?”

“THE OUTSOURCING BOOGEYMAN IS BACK

Here we go again...get ready for the onslaught of pro-Kerry sob stories about outsourcing. Secretary of the Treasury John Snow argued in an interview published yesterday that outsourcing ultimately helps the US economy. Snow said that outsourcing "is a part of trade...and there can't be any doubt about the fact that it makes the economy stronger." Of course, he's absolutely right. Now since a lot of you seem to think otherwise, how about a brief economics lesson.

Imagine if you went into a store...any store will do...and you wanted to buy a widget. Hanging on the store shelf were two identical widgets of the same quality and workmanship. As a matter of fact, you can't tell the difference except that on one label it says made in the USA and on the other it says made in China. Why...you'll buy the American made one, right? Sure...but wait...the one made in China costs half the price...which one are you going to buy?

Another example...you sign up for a credit card. The credit card company offers you a choice: if you have a problem, you get to call a customer service center based in the United States, or one based in India. If you chose the outsourced one, your interest rate is lowered 3 points. Which one would you chose? That's right...most people would chose to save the money.

So enough whining about outsourcing. Your quest for lower prices is what's driving this situation.”

“Stratdewd, you make excellent economic sense.”

“What does 'government educated' mean? Someone who went to a public school? And who wrote that drivel? Bacpac?”

“How about 40 acres and a mule for everyone.”

“I think the real measure of weather it is good for the economy is if it helps in the creation of new jobs and so far the best answer to that is lets wait and see. If job creation comes out of it then it’s a good thing. If jobs are not created then which one costs less is irrelevant because I can’t buy either one.”

“Here is how I view the situation arclite..

Back in the 50's and 60's, before world trade was abundant, you had mainly male breadwinners that earned income, working around 40 hours per week. You could survive, and live nicely on that income, and many did.

In the 70's, more women entered the workforce, and companies capitalized on that by paying them less. More families became two income households.

In the 80's, many more women entered the workforce, and were still paid less. Union jobs began to dissappear, and salaried employees began putting in longer hours on the whole. Many more two income families were prevelant.

In the 90's, two income families were the norm, union jobs declined even further and people were working even longer hours. 50-60 hour workweeks were becoming much more normal than in the 50's and 60's.

In 00's, not only are people working longer hours, with two income families, but many are losing thier jobs, or sacrificing pay because "free trade" now allows companies to hire 4 people overseas to do the work of 1 here, and for less money. Union jobs; the folks who brought you weekends, 40 hour workweeks and overtime, are fading even further, and the standard is now over 40 hours a week, no overtime, and more weekend work.

What does all of this mean? Our standard has gone to #&%!$ because of the combination of "free trade" and corporate greed. There are many wealthy people out there that have "earned" thier money on the backs of other's hard labor, except the people that got them thier wealth don't get to share the spoils.

"Free Trade" can be a good thing, if the playing foeld were leveled through tarriffs and trade balance, but it's not.

Right now, there is barely any balance of power, which is what repubs like, because they derive thier power from money, and those who wish to rule at all costs. They said Bush is a president that thinks like a CEO. He certainly has proven that to be true.”

“I think it means that unions are obsolete and have priced themselves out of the market.”

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“Buddha, the US has one of the best work ethics in the world. That’s one reason we work longer hours. How can you expect the US to maintain a high standard of living if we don’t compete with people from other countries who are willing to work hard to improve their living conditions? Should we protect our standard of living at the cost of others? By improving their living conditions due to free trade with the US, people from other countries become less likely to hate the US and become terrorists. Thomas Freedman wrote an interesting opinion piece on that point in the NYT.



“There are many wealthy people out there that have "earned" thier money on the backs of other's hard labor, except the people that got them thier wealth don't get to share the spoils.”

Buddha Bear


What ARE you talking about? Sounds like you picture the US as full of hucksters and criminals. You seem to have a lot of resentment there. How MANY, many wealthy people can you point to, HONESTLY, who didn’t work many long hours to get there? Or are you referring to those who inherit? And who’s backs did they climb on?

Back when I worked plumbing, one guy had been in a union. He told us that he used to get paid a full days wage for laying 250 feet of pipe a day. It didn’t matter if he laid 250 feet by lunch; he got paid for a full day. Talk about climbing on other people’s backs. We all pay for that kind of socialist garbage.



"Free Trade" can be a good thing, if the playing foeld were leveled through tarriffs…

Buddha Bear


Buddha, it’s no longer free trade if you have a bunch of protectionist tariffs (economics 101)


Buddha you seem to be exactly the type of economically challenged emotional voter that Kerry is looking for. Economics is only one issue. But I would hope more people bothered to educate themselves about issues they vote for.”

“Arclite believes in free trade for humanitarian reasons.

Liberal.”

“Phaedrus, it appears as if your cynicism is matched only by your prejudice.”

“Prejudice against what exactly?”

“Not that I really expect an answer now. You've gotten the jab in, so there's no reason to follow up with a messy explanation.”

“Pot/Kettle”

“And you're the frying pan.”

“Personally, I'm not economically challanged. As a matter of fact, I know I could make more jack working in the private sector. I choose to do this because it's the right thing to do.

If a pipelayer lays 250' of pipe, and is done by noon, what makes him/her so different from some sales dude making all of his/her calls by noon and going golfing?

Arclite, maybe the term I'm looking for is balanced trade. I'm not going to trade a Honus Wager Baseball card for a Oddibe McDowell Card, and call it balanced.

-- Baseball Card Trading Economics 101

Also, capitalism is based on greed, and when left unchecked, produces hucksters and criminals. I don't have anything to back this statement up, but I'll bet a good number of the economic top 1% of this country have inherited wealth, or earn money based on investments.

Finally, "How can you expect the US to maintain a high standard of living if we don’t compete with people from other countries who are willing to work hard to improve their living conditions?"

The majority of folks living in this country don't make this high standard of living that you speak of. And, the majority of these folks are the ones putting in the long hours to maintain a high standard of living for "the man", while just trying to get by themselves. That's what the system is based on.... just keep them hungry enough to work, and they'll keep working.”

“To add to what Buddha is getting at, if we allow trade with countries that operate at or near slavery for their workers, there will be absolutely no way we can compete for said goods. Unions are generally what keeps us from those types of conditions in the US.

In the past, trades like those mentioned above have been vacated for more complex trades or for service trades. The more recent trend of sending educated, complex jobs overseas has me a little troubled, but I doubt the level of service can be maintained. I have more confidence in the American worker.

In general, I'd like to see the US lead the WTO into a broad worker's rights bill by adding it to our own free trade agreements. It will make us more competitive in the future without compromising our quality of life.”

“I do have to bone up on my macro-economics. It seems that ole Arclite has some edumication on the subject.


hehehe - I said bone-up!”

“IMO, there is no long-term advantage in protecting American jobs, per se, but there is definite long-term advantage in protecting worker's rights and environmental standards in trade relations is we want to remain competitive.”

“...if we want...”

“Personally, I'm not economically challanged. As a matter of fact, I know I could make more jack working in the private sector. I choose to do this because it's the right thing to do.


Buddha Bear
05:52:21 PM
04/01/04

Wow, you have been brainwashed. You do work in the private sector.”

““If a pipelayer lays 250' of pipe, and is done by noon, what makes him/her so different from some sales dude making all of his/her calls by noon and going golfing?”

Buddha

The difference being, of course, that the salesman works on commission. Instead of passing on the cost of his leasure time to everyone else. Got any more easy ones?



“Arclite, maybe the term I'm looking for is balanced trade. I'm not going to trade a Honus Wager Baseball card for a Oddibe McDowell Card, and call it balanced.”

Buddha

“Balanced”…Sounds like you may be using that word sorta like the term “fair share” that some folks use in reference to the “fairness” of people with lots of money paying the overwhelming bulk of the taxes in this country. Who decides what’s balanced, Buddah? Isn’t that the job of the free market? Parties that wish to trade come to mutual agreement as to what’s balanced. That’s as fair as it gets.



“Also, capitalism is based on greed, and when left unchecked, produces hucksters and criminals. I don't have anything to back this statement up, but I'll bet a good number of the economic top 1% of this country have inherited wealth, or earn money based on investments.”

Buddha

And here I thought capitalism was based on competition in a free market. At least that’s what my dictionary tells me. Most normal folks look at capitalism as the most efficient way to improve standard of living. Greed may be a by-product by people who abuse the system, but I don’t believe in a utopian system where greed does not play a part. Look at any socialist based system and you will see abuse by the greedy. What system do you propose to control people’s behavior?



“The majority of folks living in this country don't make this high standard of living that you speak of. And, the majority of these folks are the ones putting in the long hours to maintain a high standard of living for "the man", while just trying to get by themselves. That's what the system is based on.... just keep them hungry enough to work, and they'll keep working.”

Buddha

What “high standard” do you think I’m talking about? I know "the poor" in this country have a higher standard of living than most people in many countries in the world. You want poverty? Try Mexico, try Haiti, try Afganistan, try North Korea. I’m not sure you know what real poverty is. There are many, many more people in the world dying of starvation than there are people having to do without a TV set in this country.

“The man” certainly sounds like some sinister shadowy figure that I should be afraid of. Does he fly in a black helicopter? I don’t work for this fellow but I’ll be on the lookout for him. What I hear from you are anger and resentment. You must think of yourself as a “working man.” I usually work anywhere from 50-60 hours a week. Do I qualify for “working man" status? I’m not angry or resentful about working that hard. Maybe it’s because I take home what money I don’t give to the State, instead of giving it to “the man” you mention.




So, Phaedrus, your not buying into Kerry's ideas about protecting jobs, or government creation of jobs, being good for the economy? How about his plan for lowering gas prices by pressuring OPEC? How about his plan for increasing taxes to pre-Bush levels as a way to improve the economy?”

“I don't know exactly which of kerrys plans you are referring to, Arclite. If you'd care to give me an example, I'll be happy to discuss it with you.”

“My biggest issue is with the large number of H1B visas being issued in the tech sector. I keep hearing about the lack of tech workers being touted by "industry leaders" (whoever they are) and yet I know a ton of good tech people that can't find decent work.

I don't particularly like work being shipped overseas but I understand the economic rational. And honestly I can't complain too much about it as I regularly choose to buy products based on a cost/benefit/quality basis and not on country of origin.

But shipping people HERE to replace workers who are already here and want to work and are qualified for the job makes my blood boil.”

“When Arclite gets "outsourced", then we will hear him howl.”

“arclite - I expect your Honus Wagner card in the mail sometime next week.... I just shipped Oddibe's card to you today, it's in mint condition, if that's any consolation.

BTW - I plan on selling the card, using the proceeds to buy your company, and then cutting your salary 25% to boost the stock prices, so I can make even more jack. If you don't like it, too bad, find another job, it's a free market afterall. :)”

“Another bb post on target with facts and logic.

Impossible to argue with such a solid attach against Capitalism.”

“WOW! I've been away for the weekend and the intellectual stimulation from the left is underwhelming. That's OK, I didn't expect much anyway.

Specifically, Phaedrus, why don't you expound on what you like about Kerry's plans to protect jobs in the US.

Specifically, why don't you explain your philosophical convictions about the phrase I keep hearing Democrats use; "fair share of taxes."

Specifically, do you believe that Kerry will be more successful than Clinton and Bush at pressuring OPEC for the good of the US economy?

Specifically, what parts of Kerry’s economic plan do you think will have the most positive impact on our economy?



Buddha, you ought to have a stand-up routine. Don't keep your day-job. Especially not if you're supporting some man.

My father always told me that nobody can take away what you've got between your ears. Are you worried about the capital you've got there? I'm not.”

“"To add to what Buddha is getting at, if we allow trade with countries that operate at or near slavery for their workers, there will be absolutely no way we can compete for said goods. Unions are generally what keeps us from those types of conditions in the US.

Phaedrus


One man’s slavery is another man’s living wage. If the cost of living is low, and there are no jobs available, a factory that provides jobs is a good thing. I’ll never understand how people equate wages in a poor country to wages here. That is unrealistic. Mexico doesn’t have our cost of living and so their wages are lower. People in many countries would be happy just to have a job to feed their families. It works the same in this country. There is no way I would live in the San Francisco or New York areas with the wages they pay me in Gainesville, Florida. But I have a very comfortable standard of living here. Housing is cheaper, taxes are lower, utility bills are less, and insurance costs less.

If we can’t compete then maybe we should provide other products and services. As I said, there aren’t many blacksmiths here. Maybe there are in Afghanistan. We can’t be afraid of change. Instead it is our responsibility to prepare ourselves for change. Protecting jobs with unions and tariffs merely passes the higher cost of goods and services on to the consumer. The lower classes are hurt the most.


“In the past, trades like those mentioned above have been vacated for more complex trades or for service trades. The more recent trend of sending educated, complex jobs overseas has me a little troubled, but I doubt the level of service can be maintained. I have more confidence in the American worker.”

Phaedrus

Read Thomas Freedman’s excellent article about this. He writes for the NYT, not a bastion of free-market thinking. He was a little troubled before went to India and discovered that the call-center he visited had US computers, software, and softdrinks. It is causing a trade surplus, in our favor, despite the outsourcing of jobs to India. The free-market raises everyone’s standard of living. An added bonus was that the Indians he met there loved the US. It seems that providing them with jobs to feed their families is a good thing.



Buddha, I have a rudimentary understanding of economics. It’s my hot-button issue in politics and so I figured that I had better educate myself. Among other research, I have subscriptions to The Independent Review (right of center) and The Economist (left of center). I already have a subscription to Foreign Affairs and I may get a subscription to Foreign Policy. These are not light reading. But they improve my knowledge and my vocabulary. I keep a dictionary at hand while I’m reading these magazines because they use big words.

I like to balance the perspectives on both the left and right if I can. Only reading articles that feed my preconceived notions does me no good. I don’t learn anything if I’m only reading perspectives that agree with my own. I know a guy here at work who told me that he didn’t have time to read Bias by Bernard Goldberg. The next week he was reading Bushwhacked by Molly Ivans. That’s just sad. Especially for a man who considers himself to be educated.”

“One man’s slavery is another man’s living wage. If the cost of living is low, and there are no jobs available, a factory that provides jobs is a good thing. I’ll never understand how people equate wages in a poor country to wages here. That is unrealistic. Mexico doesn’t have our cost of living and so their wages are lower. People in many countries would be happy just to have a job to feed their families. It works the same in this country. There is no way I would live in the San Francisco or New York areas with the wages they pay me in Gainesville, Florida. But I have a very comfortable standard of living here. Housing is cheaper, taxes are lower, utility bills are less, and insurance costs less.

We're talking apples and oranges. I was speaking specifically of slavery and less-than-living-wage industries in foriegn countries. Prison labor, child labor, sweatshops, and the like are what we should not be allowing. It makes the US inherently unable to compete in those markets. On the topic of environmental issue, we should also mandate that countries which want to participate in free trade with the US meet the same standards our businesses have to. The idea is not to disallow competition, but to make a more even playing field where the odds are not stacked against US companies or workers.

The free-market raises everyone’s standard of living. An added bonus was that the Indians he met there loved the US. It seems that providing them with jobs to feed their families is a good thing.


Sure, and once their infrastructure is fully in place, they'll be able to make their own computers, and we'll move on to the next thing. I get it. The only things I have mentioned that bug me are the worker's rights and environmental issues.

One other thing: I don't think it's unreasonable in a time of recession and financial downturn to reduce or disallow any tax benefits that may exist in the tax code for offshore outsourcing of jobs. This isn't protectionism in my book; it's intelligent use of taxation laws. The change will come as long as the basic tenets of the free trade agreements are in place, but curbing the most damaging effects while we're in recession is good sense, IMO.

By the way, Bias is still a rotten piece of work ;)”

“"When Arclite gets "outsourced", then we will hear him howl."
Dunadan


wrong! ! WRONG!!!! wrooooooooooooongORAMA



when arclite get's outsorced, he will recognize that he is in the wrong profession and find a new one that the FREE MWRKWT determines is more profitable for him.”

““I was speaking specifically of slavery and less-than-living-wage industries in foreign countries. Prison labor, child labor, sweatshops, and the like are what we should not be allowing. It makes the US inherently unable to compete in those markets. On the topic of environmental issue, we should also mandate that countries which want to participate in free trade with the US meet the same standards our businesses have to.

Phaedrus


Are you consistent with your principles? You are advocating that we interfere with the way other countries run their economies and culture. Are you saying that we should control how they do business? I feel that by allowing free trade, other countries are exposed to our ideas. As their standard of living increases though free trade, hopefully their policies become more humane. But I am not a control freak, and do not believe that we should be telling other cultures that they should adhere to our standards. Environmental standards are a worthy goal. How do you propose to control other people’s behavior? Do we abandon them if they don’t meet our standards? The Kyoto Protocol, which the left has accused the Bush administration of ignoring, sets different standards for first and third world countries. Do you stand by the Kyoto Protocol, or do you have different standards you’d like to impose?


“One other thing: I don't think it's unreasonable in a time of recession and financial downturn to reduce or disallow any tax benefits that may exist in the tax code for offshore outsourcing of jobs. This isn't protectionism in my book; it's intelligent use of taxation laws. The change will come as long as the basic tenets of the free trade agreements are in place, but curbing the most damaging effects while we're in recession is good sense, IMO”

Phaedrus


IMHO it is better to reduce govmint spending than raise taxes. Taxes are difficult to get rid of. And govmint has always proved that it will spend to, and above, existing taxation levels. There are lots of ways to reduce spending that never make the newspapers. CAGW has some interesting stats on govmint’s wasteful spending. I’m for reducing the size of govmint. Once you grow govmint, it’s difficult to reduce its size. People try to protect and enlarge their field of influence. Before you know it, we have govmint that provides way too many services. You create a political class that is dependent on big govmint for their job. This is socialist philosophy. Bad idea in my opinion.



What, specifically, do you think is rotten about Bias? Did you see nothing interesting in the facts and figures that were presented? I fear you are like a "liberal" guy in our office. He agrees with everything that fits his preconceived notions, and hates everything that disagrees. What a horrible way to live life.”

“Are you consistent with your principles? You are advocating that we interfere with the way other countries run their economies and culture. Are you saying that we should control how they do business? I feel that by allowing free trade, other countries are exposed to our ideas. As their standard of living increases though free trade, hopefully their policies become more humane. But I am not a control freak, and do not believe that we should be telling other cultures that they should adhere to our standards.

My principals are consistent, but thanks for asking. Human rights isn't an optional cultural nicety, IMO, Arc. If we, as a nation, really want to make the world a safer place, economic engagement with strict humanitarian rules in place goes a hell of a lot further than military action, IMO. If we ramp up the pressure on developing nations to provide for human rights before we will trade with them we win all the way around. We temporarily insulate American jobs by allowing American companies to better compete (in the short term), and we provide for a loss flammable environment that will more quickly become receptive to American ideals.

Environmental standards are a worthy goal. How do you propose to control other people’s behavior? Do we abandon them if they don’t meet our standards? The Kyoto Protocol, which the left has accused the Bush administration of ignoring, sets different standards for first and third world countries. Do you stand by the Kyoto Protocol, or do you have different standards you’d like to impose?


The US can lead the WTO by the nose on this item. Europe is already clamoring for these changes to be made, so we can steadily increase the environmental restrictions on industry in developing countries through the WTO. IMO, this is an easy one, but I'm not sure there is a democrat or republican out there who isn't so owned by business that this will happen. That said, any movement on this is a good thing.

IMHO it is better to reduce govmint spending than raise taxes. Taxes are difficult to get rid of. And govmint has always proved that it will spend to, and above, existing taxation levels. There are lots of ways to reduce spending that never make the newspapers. CAGW has some interesting stats on govmint’s wasteful spending. I’m for reducing the size of govmint. Once you grow govmint, it’s difficult to reduce its size. People try to protect and enlarge their field of influence. Before you know it, we have govmint that provides way too many services. You create a political class that is dependent on big govmint for their job. This is socialist philosophy. Bad idea in my opinion.


It's good that you have an opinion on the matter. Here's mine:

Corporations are tax-sheltering outside the US so heavily that, according to a recent Frontline, the average corporate tax rate, based on total income percentage is 17%. You and I pay higher percentages. I don't consider closing tax loopholes to be raising taxes. I consider it to be cleaning up waste fraud and abuse. We agree on that much.

What, specifically, do you think is rotten about Bias? Did you see nothing interesting in the facts and figures that were presented? I fear you are like a "liberal" guy in our office. He agrees with everything that fits his preconceived notions, and hates everything that disagrees. What a horrible way to live life.

LOL! You sure did leap to a conclusion there, Arctite! Maybe your prejudice and preconcieved notions are holding you back!

As we discussed before, I found nothing convincing in his argument. His premises were weak, and some were false. IMO, the book was not intended to convince, but rather to pander to people who already had his opinion on the media. If a overriding left-leaning bias exists in the media (which I'm not completely discounting) he certainly didn't prove it. You were going to read Eric Alterman's book so we can discuss the two in contrast, weren't you?”

“Phaedrus, my comment about consistent principles was directed at your attitude about environmental issues. I certainly hope you didn’t criticize the Bush administration (or Clinton’s for that matter) for not signing the Kyoto protocol as did many on the left. Considering that you think there should be similar environmental standards for every country that would have been hypocritical.

I still think you’re pushing your morals on other cultures. That is part of the leftist attitude I find very funny. Complaining that “Conservative Christians” are pushing their moral values on everyone, while pushing their very own left-secular moral agenda. Whiners!

But I like some of your ideas. We already make limited use of them in our economic dealings with other countries. How far do you want to push your moral agenda on other cultures? What happened to diversity? I would hope that you have consistent principles about tolerance as well.

Nothing will protect American jobs if other people in other countries are willing to do the same work for lower wages because their cost of living is lower. How do you like those apples?



“Corporations are tax-sheltering outside the US so heavily that, according to a recent Frontline, the average corporate tax rate, based on total income percentage is 17%. You and I pay higher percentages. I don't consider closing tax loopholes to be raising taxes. I consider it to be cleaning up waste fraud and abuse. We agree on that much.”

While you may not agree with they way they conduct business, if their actions are within the law, you have no justification for calling these actions “fraud and abuse.” Taxing corporations just passes costs on to consumers. The people with less are hurt more. What, you want to tax corporations, raise the cost of goods and services, give govmint more money, create more social programs, and make everyone dependant on govmint welfare? Nice economic plan.



You still haven’t answered my question. What SPECIFIC stats in Goldberg’s book don’t you agree with? But I have seen this strategy of argument from you before: “Your stats are biased, here are the unbiased stats. Oh, and hey, they just happen to agree with my point of view.” You’ve taken this stance before. Who do you think you’re fooling? I will try to read Eric Alterman's book within the month. I have a long list of wanna-doos.”

“I still think you’re pushing your morals on other cultures. That is part of the leftist attitude I find very funny. Complaining that “Conservative Christians” are pushing their moral values on everyone, while pushing their very own left-secular moral agenda. Whiners!

Get a grip on what I actually said before you lump me in with everyone who has a political leaning left of yours and call us all "whiners". Let's examine the issue: Economic engagement.

1. Human rights may be a moral issue, but more than that it's a pragmatic one. The nations that abuse their own are the nations that we, as a democracy, always end up sending the military into - both for humanitarian and security reasons. This isn't a coincidence, and I doubt that anyone who has studied history in the slightest will disagree. Further, as I stated before, it makes for a better trading partner.

2. Environmental policies that force countries to reach targets based on where they are currently are more realistic than demanding a third-world nation install california emissions on all its cars where they're barely able to afford food - I can see the point of the kyoto treaty's wording in that regard, but I think you're right. Stricter controls are needed.

But I like some of your ideas. We already make limited use of them in our economic dealings with other countries. How far do you want to push your moral agenda on other cultures? What happened to diversity? I would hope that you have consistent principles about tolerance as well.

I have no tolerance for slave labor and don't consider ethnic cleansing diversity. You're really stratching to find something to brow-beat me for. If you're wondering, I'm all for using trade to encourage democracy and liberal human rights positions throughout the world. Do you disagree somehow?

Nothing will protect American jobs if other people in other countries are willing to do the same work for lower wages because their cost of living is lower. How do you like those apples?

No kidding? Is this the level of the conversation now?

While you may not agree with they way they conduct business, if their actions are within the law, you have no justification for calling these actions “fraud and abuse.” Taxing corporations just passes costs on to consumers. The people with less are hurt more. What, you want to tax corporations, raise the cost of goods and services, give govmint more money, create more social programs, and make everyone dependant on govmint welfare? Nice economic plan.

Slippery slope. You're really pulling out all the stops in this one, eh? Taxing corporations does not lead to washington becoming moscow, comrade. Closing tax loopholes that reward corporations for offshore outsourcing does not mean we'll all end up in a bread line.

You still haven’t answered my question. What SPECIFIC stats in Goldberg’s book don’t you agree with? But I have seen this strategy of argument from you before: “Your stats are biased, here are the unbiased stats. Oh, and hey, they just happen to agree with my point of view.” You’ve taken this stance before. Who do you think you’re fooling? I will try to read Eric Alterman's book within the month. I have a long list of wanna-doos."


I'll have to get back to you on an in-depth discussion of this, since I'm at work right now, but off the top of my head: he quotes a study on the media that we've discussed having serious flaws in its methodology, he falsified an account of (I believe) Peter Jennings and his quotes in watching a congressional roll call, he completely ignored most of the media by ignoring cable news, talk radio, religious news, and publications of the same.

Like I said, there may be a conservative or liberal overall slant to the media as a whole, but this book did nothing to address or study it.”

“pheaddy, it's amazing what lengths you will go to in order to beleiv the left point of wiew.....

hey, more power toya...”

“From Morgan Stanley's Stephen Roach:

In all my years in this business, never before have I seen a central bank attempt to spin the debate as America’s Federal Reserve has over the past six or seven years. From the New Paradigm mantra of the late 1990s to today’s new theories of the current-account adjustment, the US central bank has led the charge in attempting to rewrite conventional macroeconomics and in making an effort to convince market participants of the wisdom of its revisionist theories. The problem is that this recasting of macro is very self-serving. It is a concentrated effort on the part of the Fed to exonerate itself from the Original Sin of failing to address asset bubbles. The result is an ever-deepening moral hazard dilemma that poses grave threats to financial markets.

I am not a believer in conspiracy theories. But the Fed’s behavior since the late 1990s is starting to change my mind. It all began with Alan Greenspan’s worries over “irrational exuberance” on December 5, 1996, when a surging Dow Jones Industrial Average closed at 6437. The subsequent Fed tightening in March 1997 was aimed not only at the asset bubble itself, but at the impacts such excessive appreciation in equity markets were having on the real economy -- consumers and businesses alike. It was a classic example of the Fed playing the role of the tough guy -- the central bank that, to paraphrase the words of former Chairman William McChesney Martin, “takes away the punchbowl just when the party is getting good.” Unfortunately, the tough guys weren’t so tough after all. Predictably, there was a huge outcry on Capitol Hill as the Fed took aim on the US stock market. But rather than stay the course as an independent central bank should, the Fed ran for cover in the face of political criticism. Not only were its initial bubble-containment efforts put aside, but Alan Greenspan went on to champion the notion of a sea-change in the macro climate -- a once-in-a-century productivity miracle that would justify the stock market’s exuberance as rational. That was the Original Sin that has since been compounded in the years that have followed.

Out of that pivotal moment in the late 1990s, a New Economy actually did come into being. But it was not the new economy of ever-accelerating productivity growth that infatuated the New Paradigm Crowd and legions of equity-market speculators. Instead, it was the Asset Economy that enabled consumers and businesses to draw on the pixie dust of a new source of purchasing power -- asset appreciation -- as a means to augment what has since turned into a stunning shortfall of organic domestic income generation.

Unfortunately, the asset-based spending model has given rise to many of the distortions and imbalances evident in the US today. That’s especially true of low saving rates, the housing bubble, high debt loads, and a runaway current account deficit. When the equity bubble burst, asset-dependent American consumers barely skipped a beat. Courtesy of an extraordinary shift to monetary accommodation, the pendulum of asset depreciation quickly swung into property markets; US house-price inflation has since surged to a 25-year high. To the extent that equity extraction from ever-rising property appreciation was viewed as a substitute for organic sources of labor income generation, hard-pressed consumers went deeply into debt to monetize the windfall. As a result, household sector indebtedness surged to nearly 90% of US GDP -- an all-time record and up over 20 percentage points from levels in the mid-1990s when the Asset Economy was born. Secure in the asset-driven spending posture that resulted, consumers saw no need to save the old-fashioned way out of earned labor income. That’s why the personal saving rate has collapsed and currently stands near zero. Asset-based consumption is also at the core of America’s current-account problem. In an income-based accounting framework, the “missing saving” has to come from somewhere. In this case, that “somewhere” is the foreign saver -- giving rise to the current-account and trade deficits required to attract the foreign capital. As a result, the US current-account gap probably exceeded 6.5% of GDP in the first quarter of 2005 -- easily another record and well in excess of the 4% deficit prevailing in the mid-1990s.

This whole story, in my view, remains balanced on the head of a pin of absurdly low real interest rates. And the Fed has certainly been pivotal in nurturing this low-interest-rate regime. In an extraordinary display of policy accommodation, the real federal funds rate is only now moving above the zero threshold after having spent three years in negative territory. Of course, a central bank has little choice to do otherwise if it has made a conscious decision to underwrite the Asset Economy. After all, it takes low interest rates to provide valuation support to most financial assets -- initially stocks, then bonds, and now property. Furthermore, it takes low rates to make refi debt -- and the equity extraction it sponsors -- look attractive from a carrying cost perspective. Low rates also discourage income-based saving by underscoring the paltry returns available to savers in traditional asset classes. A migration to riskier assets -- such as property and “spread” products (i.e., high-yield and emerging market debt) -- is encouraged as a result. And low real rates make it easier to finance an ever-widening current-account deficit -- especially if the incremental flows come from foreign central banks, where there is reason to tolerate subpar returns in exchange for currency competitiveness. In short, without low real interest rates, the Asset Economy -- and all of its inherent imbalances and excesses -- is nothing.

The Fed is not only hard at work in the engine room in keeping the magic alive with a super-accommodative monetary policy but is has also become the intellectual architect of the New Macro. Time and again, since Alan Greenspan rolled out his New Paradigm theory in the late 1990s, senior Federal Reserve policy makers have taken the lead role as proselytizers of a new macro spin that condones the saving, debt, property bubble, and current-account excesses of the Asset Economy. The examples are far too numerous to mention, but consider the following highlights:

* Chairman Greenspan has made light of traditional measures of household indebtedness -- even going so far as to urge consumers to move from fixed to floating rate obligations (see his February 23, 2004, speech, Understanding Household Debt Obligations. Note: All references are to speeches available on the Fed’s website at www.federalreserve.gov).

* Fed governors have also borrowed a page from the Roaring 1990s in denying the possibility of a housing bubble (see Chairman Greenspan’s October 19, 2004, speech, The Mortgage Market and Consumer Debt, and Governor Kohn’s April 1, 2004, speech, Monetary Policy and Imbalances).

* More recently, an army of senior Fed officials -- namely, Chairman Greenspan, Vice Chairman Ferguson, and Governors Bernanke and Kohn -- have unleashed a veritable broadside against the time-honored notion of the current-account adjustment (see their various 2005 speeches, especially Governor Kohn’s April 22 speech, Imbalances and the US Economy, Vice Chairman Ferguson’s April 20 speech, U.S. Current Account Deficit: Causes and Consequences, and Chairman Greenspan’s February 4 speech, Current Account).

* Governor Bernanke has also led the charge in coming up with a new theory of national saving -- that the United States is actually doing the world a favor by absorbing a so-called glut of global saving (see his April 14, 2005, speech, The Global Saving Glut and the U.S. Current Account Deficit); Vice Chairman Ferguson has been on a similar wavelength in dismissing concerns over subpar personal saving (see his October 6, 2004, speech, Questions and Reflections on the Personal Saving Rate).

Is this is an appropriate role for a central bank? In my view, absolutely not. The problem with an activist central bank is that decision makers in the real economy -- consumers and businesspeople alike -- mistake the Fed’s point of view for strategic advice. And so do financial market participants. After hearing the Fed pound the table, consumers feel left out if they don’t spend their housing equity. Business managers felt equally deprived in the late 1990s if their companies didn’t achieve the dotcom-type valuations in the stock market that Chairman Greenspan insisted in the late 1990s and even early 2000 were well grounded in a once-in-a-century productivity miracle. The resulting overhang of excess IT spending was a direct outgrowth of this perceived deprivation. Needless to say, when investors and financial speculators saw the equity train leave the station and the Fed condone the high growth of a productivity-led economy by leaving interest rates low, they saw no reason to believe that a bubble was about to burst. When consumers hear from a Fed chairman that it makes little sense to take on fixed rate debt, they rush to floating rate instruments; not by coincidence, the adjustable rate portion of newly originated mortgage debt shot up in the immediate aftermath of Chairman Greenspan’s comments on consumer indebtedness. And should asset-dependent, saving-short, overly indebted American consumers feel at risk if the Fed assures them that there is no housing bubble -- that the asset-based underpinnings of their decision making are well grounded? A record consumption share in the US economy -- 71% of GDP since 2002 versus a 67% norm over the 1975 to 2000 period -- speaks for itself.

The rhetorical flourishes of America’s central bankers have dug the US economy -- and by definition, a US-centric global economy -- into a deep hole. To this very day, the Fed has never confessed to the Original Sin of condoning the equity bubble. On the contrary, Greenspan & Company have been on the defensive ever since by dismissing the increasingly dangerous repercussions of the original post-bubble shakeout. Far from playing the role of the tough guy that is required of independent central bankers, the Fed has become an advocate of the easy money of a powerful liquidity cycle. One bubble has since begotten another -- from equities to bonds to fixed income spread products (i.e., emerging market and high-yield debt) to property. And financial markets have gone along for the ride -- not just in the US but also around the world as global investors and foreign central banks have rushed with reckless abandon to finance America’s record current-account deficit.

The day is close at hand when US monetary policy must get real. At a minimum, that will require a normalization of real interest rates. Given the excesses that now exist, it may even require a federal funds rate that needs to move into the restrictive zone -- possibly as high as 5.5%. Yes, this would cause an outcry -- perhaps similar to that which occurred in the spring of 1997 on the occasion of the Original Sin. But in the end, there may be no other choice. Fedspeak has taken us into the greatest moral hazard dilemma of all -- how to wean an asset-dependent system from unsustainably low real interest rates without bringing the entire House of Cards down. The longer the Fed waits, the more perilous the exit strategy.”

“Too many words.”

“Asset bubble bad.
Greenspan accomplice.
Be careful.”