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LeavingMA, wanneroo and Traderx have hit the nail on the head. I would add two things at the political level that would help enormously:
1) ban all Congressional lobbying by organizations (non-profit and corporations alike).
2) ban political parties - the Founders were suspicious of them, and for good reason.
Taking both of the steps above would solve the problem of organizational influence that leads to anti-capitalist meddling by the government. The absence of political parties would force politicians and the populace alike to focus on actual issues of governance rather than silly party disputes (as if there's really a difference in how the bozos from both parties have actually governed or really tried to govern).
Given a truly free media and a relatively well educated population - I like to think we still have both, despite our other problems - reason should triumph over special interests, which should go a long way to restoring balance and sanity in the economy.
LeavingMA, wanneroo and Traderx have hit the nail on the head. I would add two things at the political level that would help enormously:
1) ban all Congressional lobbying by organizations (non-profit and corporations alike).
2) ban political parties - the Founders were suspicious of them, and for good reason.
Taking both of the steps above would solve the problem of organizational influence that leads to anti-capitalist meddling by the government. The absence of political parties would force politicians and the populace alike to focus on actual issues of governance rather than silly party disputes (as if there's really a difference in how the bozos from both parties have actually governed or really tried to govern).
Given a truly free media and a relatively well educated population - I like to think we still have both, despite our other problems - reason should triumph over special interests, which should go a long way to restoring balance and sanity in the economy.
HUH?? Besides the fact all this is totally impossible, Wall Street would still be cutting our throats to get at whatever was left from our 50$ a week paychecks under that scenario.
Government control is the ESSENCE of late capitalism, not its enemy.
We need to promote "fair" trade by leveling the playing field. If we set a standard (worldwide) wage expectation for imports and used tariffs to take away the incentive to hire $200/month labor pools, there wouldn't be a compelling reason to outsource jobs.
If countries like China didn't want to get hit with a massive tariff, all they'd need to do to avoid it is to increase the value of their currency to a level which would put their workers on par with the rest of the developed world.
Actually tariffs drove us head long right into the Great Depression.
Remember the boring classroom talk in "Ferris Bueller's Day Off" by Ben Stein about the Smoot Hawley Tariff Act of 1930?
That act pretty much was the coup de grace to start the depression. If the overleveraged stock market collapse was the initiator in 1929, this act pretty much finished strangling all trade around the world and initiated a series of trade wars that killed our manufacturing and agriculture businesses.
Absurd high taxes and stupid, inane Keynesian government spending by FDR covered the grave with dirt and left us with a generational depression.
We are angling for the same right about now with obama and his circus clowns in congress.
1929 and 1930 had the potential just to be a severe recession like the Panic of 1907 but idiotic government meddling and fiddling and interference did that in.
Actually tariffs drove us head long right into the Great Depression.
That's true, but not all tariffs are created equal. When a country uses them for protectionism it causes problems, but if we use them to prevent other countries from gaining an unfair advantage at the expense of its citizens it can be a good thing.
If you're buying your wedding ring, wouldn't you feel better knowing that the gold came from a mine where workers are provided with safe equipment and paid a living wage instead of being processed by peasants who are living in near servitude and inhaling mercury fumes all day? Properly used, tariffs can encourage the former and discourage the latter.
Use of this sort of tariff isn't directly protectionist, but it does indirectly discourage the offshoring of jobs where safety and environmental factors put the US at a competitive disadvantage.
Use of this sort of tariff isn't directly protectionist, but it does indirectly discourage the offshoring of jobs where safety and environmental factors put the US at a competitive disadvantage.
The offshoring of jobs happens for a couple of reasons.
One of which is simple capitalism. I hear people talk of the death of manufacturing here in the USA, yet I travel all over the USA every year and I see new factories being built all the time. Some big ones too. It's just that manufacturing here evolved into higher tech more specialized products.
The low skill jobs like making t-shirts and spoons went overseas.
When I first moved to Alabama in the 9th grade 20 years ago in the town I lived in we still had a number of textile plants making simple clothing. By the time I was in college locally, they had all gradually gone out of business, eventually replaced by higher tech jobs making auto parts, ear protection, electronics, helicopters, etc.
I think most people would rather make $25.00 an hour making helicopter components than making $5.35 an hour making t-shirts.
The second of which we do to ourselves and that is the onerous government bureaucracy and taxation. New York, California and New Jersey are great microcosm examples of what happens when you adopt a high tax and spend, anti business attitude.
If countries like China didn't want to get hit with a massive tariff, all they'd need to do to avoid it is to increase the value of their currency to a level which would put their workers on par with the rest of the developed world.
And this would reduce the standard of living of Americans. I really don't understand how people think that by removing subsidies to the US, they are going to some how improve the lives of people in the US.
what we need is a government that will step in and protect the dollar. they don't want to see the stock market take any kind of short term hit (due to their own ties to wall street) but the market is now disconnected from american industry and is engaged in full scale speculative gambling.
as usual, karl denninger sums this speculation up nicely:
Less than 10 minutes after disastrous consumer confidence numbers were released the dollar basically imploded (as you'd expect - the dollar is fundamentally underpinned by the government's ability to tax, and without confidence and jobs that ability to tax disappears) and as it did the S&P 500 marched steadily higher by 1%, propelled by the simultaneous implosion of the currency.
Folks, this will not end well. This intentional distortion of asset prices against the underlying economic fundamentals will revert, and when it does the stock and credit markets (which have been "pumped" by equity appreciation) will be destroyed.
We learned exactly nothing from Japan doing the same thing and getting the same result. We have exactly nobody in Congress or The Administration that will put a stop to it, but you can be certain that it will end, whether by our foreign creditors saying "*********!" or by the simple over-inflation of the balloon which will explode - just as did the housing bubble, just as is the commercial real estate bubble, just as did the leveraged loan bubble, and just as did the consumer debt bubble.
who can't see this????? (also, back to post 14 to see how this hurts the average american as well as the falling dollar)
what we need is a government that will step in and protect the dollar. they don't want to see the stock market take any kind of short term hit (due to their own ties to wall street) but the market is now disconnected from american industry and is engaged in full scale speculative gambling.
as usual, karl denninger sums this speculation up nicely:
Less than 10 minutes after disastrous consumer confidence numbers were released the dollar basically imploded (as you'd expect - the dollar is fundamentally underpinned by the government's ability to tax, and without confidence and jobs that ability to tax disappears) and as it did the S&P 500 marched steadily higher by 1%, propelled by the simultaneous implosion of the currency.
Folks, this will not end well. This intentional distortion of asset prices against the underlying economic fundamentals will revert, and when it does the stock and credit markets (which have been "pumped" by equity appreciation) will be destroyed.
We learned exactly nothing from Japan doing the same thing and getting the same result. We have exactly nobody in Congress or The Administration that will put a stop to it, but you can be certain that it will end, whether by our foreign creditors saying "*********!" or by the simple over-inflation of the balloon which will explode - just as did the housing bubble, just as is the commercial real estate bubble, just as did the leveraged loan bubble, and just as did the consumer debt bubble.
who can't see this????? (also, back to post 14 to see how this hurts the average american as well as the falling dollar)
I remember a German economist saying long-term planning in the US is 2 months, in Europe 2 years, in China 50 years and in Japan 200.
The US was a done deal decades ago as Wall Street became dominant in all facets of American life.
As we speak, Joe Six pack is taking advantage of "buying opportunities" that are converted into Euros, Swiss Francs etc before 24 hrs have passed.
What do you think should be done to fix America's economy?
simple:
1. repeal Nafta/cafta/gatt......the 'freetrade' done by bush1/clinton/bush2, and now obama are killing us,.. 60 million jobs lost since nafta was passed by the democrat controlled congress in Dec 93 and signed into law by clinton
2. put back/increase the import tarrifs....include companies like GE that are HQ'd in CT, but manufacture in mexico/malasia...if it is made/assembled outside the states its an import
3. lower/remove the corporate tax.....we have the 2nd highest corporate tax in the world.
4. have local governments give property tax breaks for new businesses.
5. pass the 'fair-tax'
6. convert welfare to 'workfare', give people the training, and get them a job..there are too many people riding the system and we cant sustain it anymore
JMHO
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