Economic Populism : Biggest threat to U.S. Economy

Townhall ^ | 12/31/2007 | David Strom

[Cringing Negativism Network]

Welcome to FR.

Buy American!

[TheLion]

I think the “Biggest threat to U.S. Economy” is allowing a Democrat into the Whitehouse.

[stylin19a]

The biggest threat to our economy is we stop buying...for whatever reason...

[Democrat_media]

“The economy,” simply put, is not manageable like a machine. It is dynamic, driven by the choices, actions, and desires of over 300 million Americans, and ultimately the billions of people around the world. However frustrating it is to think that our fortunes are hostage to the actions of people across the globe, there is almost nothing positive the government can do to change that fact. We all live on the same planet and are tapping into the same resources to better our lives. It is the inventiveness of individuals and firms that shape those resources into useful products and services that truly make up the economy.”

That’s very true. The economy is not manageable. But people think that evil, corrupt politicians and inept,corrupt, bureaucrat madmen can somehow manage the economy.

[Democrat_media]

“The economy,” simply put, is not manageable like a machine. It is dynamic, driven by the choices, actions, and desires of over 300 million Americans, and ultimately the billions of people around the world. However frustrating it is to think that our fortunes are hostage to the actions of people across the globe, there is almost nothing positive the government can do to change that fact. We all live on the same planet and are tapping into the same resources to better our lives. It is the inventiveness of individuals and firms that shape those resources into useful products and services that truly make up the economy.”

That’s very true. The economy is not manageable. But people think that a FEW evil, corrupt politicians and inept,corrupt, bureaucrat madmen can somehow manage the economy.

[johnthebaptistmoore]

Or allowing a “Democrat Lite” into the WH. Thompson/Hunter ‘08 is truly the best choice!

[secretagent]

I like the message because it makes sense to me intuitively, but I think others (Patrick Buchanan ?) have claimed that America has prospered most when it had high trade barriers.

Anyone here familiar with that argument?

[Cruz]

good post

[an amused spectator]

In fact, quite the opposite is the case. Government policies have proven time and again capable of slowing economic growth, but with few exceptions they have never proven capable of stimulating the economy in the long term.

Actually, for entertainment purposes, one should take bets on how one's local or state government is going to screw up any specific approach to an economic problem. This would also serve to educate the bettors.

For example, in many states a problem has arisen with people stealing copper and selling it for scrap.

The state governments are going to "solve" the problem, but it's certain they'll step all over people who are legitimately selling scrap copper.

Just pick the stupidest idea you can think of, and that's prolly the answer they'll arrive at...

[e-male]

The greatest prosperity our nation has experienced coincided with the accumulation of $9 trillion of debt. Deficit spending and perpetual debt must be good economic policy. The government controls all that.

[Graybeard58]

The economy is booming at my house.

[Captain Pike]

An article in Wired magazine around 10 years ago forcast the "Long Boom", that would be the result of increasing international trade and modernization of the third world, thus increasing their productivity and purchasing power. They thought the world would have 25 years of solid growth. So far, so good.

Those that would pull up the drawbridge and hunker down in fortress America (Buchannon) are idiots. Trade barriers and other isolationist ideas were some of the causes of the great depression.

[SeekAndFind]

I’ve read Buchanan’s arguments but in the light of what’s happening to the US economy, I don’t see how his doom and gloom makes sense.

Consider what happened in 2007 even in the midst of globalization ( source : American Enterprise Institute) :

The US trade deficit declined. As our trading partners become wealthier, they demand more of our products. At the same time, the weaker dollar has made U.S. exports cheaper. Exports have boomed, and the real trade deficit has narrowed, from $624.4 billion in 2006 to an estimated $562.4 billion in 2007.

Even in the face of the housing-market bust, economic growth was solid. If someone told me last December that construction of single-family homes would drop in 2007 by 27 percent, about the current estimate from Economy.com, then I would have expected the economy to be in recession. But a collapse of that scale did occur, and annual GDP growth, according to the latest Economy.com estimate, was about 2.5 percent. There are plenty of developed countries that would take that type of growth every year.

Job creation was robust. According to the latest jobs report, which covers data through November, the U.S. economy added 1.3 million jobs on net in 2007. The unemployment rate was 4.6 percent in January, and finished the year a smidgen higher at 4.7 percent. Both levels are very low by historical standards.

AND TO TOP IT ALL :

Households are wealthier. In part because of rising equity markets, household net worth increased in 2007, according to the latest numbers from the Federal Reserve. At the start of the year, net worth was $56.1 trillion. By the third quarter, this climbed to $58.6 trillion and probably rose again in the fourth quarter. If changes in wealth affect the economy through consumption, then the affect will be favorable.

Of course there will be winners and losers in globalization just as there will be in any capitalistic system. Hey, thousands of switchboard operators became redundant with the advent of computerized switching, the Pony Express became obsolete with the advent of the railway and cars. Surely Buchananites aren’t suggesting that we stop inventing new technology because it would displace thousands of workers are they ??

What we’re looking at is ON THE AGGREGATE -— Globalization has been good for BOTH America and the rest of the developing world ( even when there are inevitably going to be displaced workers who will be affected ).

[DB]

As long as Americans aren’t afraid to compete, we’ll do just fine.

It is the paranoid among us that feel they can’t compete with a destitute slave that are the biggest threat. If they gain enough control to enforce their world view on us we’ll have another depression.

[absalom01]

“...economic populism...”

Whatever that is. Sounds like an alternative definition of socialism to me. I’ll buy that: socialism has brought nothing but penury and misery wherever, and whenever it has been implemented.

Same old enemy. Shiny new name?

[driftless2]

As long as there is a Democrat Party, we will have millions of economically ignorant citizens. My Dem friends, family, co-workers truly believe among other things that the rich pay no taxes, Bush tells the oil companies when to raise and lower prices, and corporations are evil. I would bet that a majority of Democrat faithful believe at least one or all of the preceding statements.

[driftless2]

"trade barriers"

You mean trade barriers like the Smoot-Hawley amendment of 1930 that exacerbated The Great Depression? Barriers and tariffs designed to help small segments of a nation's work force usually end up hurting the country at large.

[Caipirabob]

The biggest threat to our economy is we stop buying...for whatever reason...

The problem is that the very second a Democrat looks to win POTUS in 2008, many people will begin locking down their assets in "survival mode" as a reflex to the approaching tyranny to come.

Rats are bad for business. The election of one could definitely lead us into a recession. Particularly when they have a rat house and senate behind them. Think "Economic Armageddon".

[Ben Ficklin]

"Anyone here familiar with that argument?"

Pat and others try to compare today to the Post WW 2 era.

At that time, the US held the competitive edge in manufacturing and had plenty of cheap oil. Under those conditions, multi-lateral foreign trade was the policy.

As the US lost its competitive edge to an industrializing world, and rising, imported energy costs, trade policy changed from only multi-lateral to include bi-lateral and regional. To trading in our own back yard. To trading with undeveloped nations.