The Grasshoppers And The Ants, A Modern Fable

The Business Insider ^ | 5-26-2010 | Martin Wolf

[blam]

The Grasshoppers And The Ants, A Modern Fable

Martin Wolf, Financial Times
May 26, 2010, 9:53 AM

Everybody in the west knows the fable of the grasshopper and the ant. The grasshopper is lazy and sings away the summer, while the ant piles up stores for the winter. When the cold weather comes, the grasshopper begs the ant for food. The ant refuses and the grasshopper starves. The moral of this story? Idleness brings want.

Yet life is more complex than in Aesop’s fable. Today, the ants are Germans, Chinese and Japanese, while the grasshoppers are American, British, Greek, Irish and Spanish. Ants produce enticing goods grasshoppers want to buy. The latter ask whether the former want something in return. “No,” reply the ants. “You do not have anything we want, except, maybe, a spot by the sea. We will lend you the money. That way, you enjoy our goods and we accumulate stores.”

[snip]

[muddler]

So it was the American workers idea to move our manufacturing base over seas? I don’t think so.

[sickoflibs]

RE :”Yet life is more complex than in Aesop’s fable. Today, the ants are Germans, Chinese and Japanese, while the grasshoppers are American, British, Greek, Irish and Spanish. Ants produce enticing goods grasshoppers want to buy. The latter ask whether the former want something in return. “No,” reply the ants. “You do not have anything we want, except, maybe, a spot by the sea. We will lend you the money. That way, you enjoy our goods and we accumulate stores”

This is the Peter Schiff analogy. Of course the producing countries have not figured out how to expand demand of their products without selling them to the consuming countries. If they did they wouldn't have a problem; and then the consuming countries would be forced to change too. This is why China devalues it's currency to keep it pegged to the dollar, even though that makes things more expensive for it's citizens.

[Nervous Tick]

Interesting. Especially the last three paragraphs.

[Codeflier]

In this analogy, one of the ants (United States) effectively provides all the military defense of two of the grasshoppers. Therefore this doesn’t work for me.

[sickoflibs]

I just read the original which takes a jump to two links put below. This is the Bush era economy/financial bubble story as told by a Peter Schiff type:Ants are far better at making real products than at assessing financial ones. So grasshoppers discover clever ways of packaging their grasshopper loans into enticing assets for ant banks. Great writing.

The grasshoppers and the ants – a modern fable

[Codeflier]

Oops...reversed ants and grasshoppers.

Should be:

In this analogy, one of the grasshoppers(United States) effectively provides all the military defense of two of the ants. Therefore this doesn’t work for me.

[Trinity5]

"So it was the American workers idea to move our manufacturing base over seas? I don’t think so."

No, but their actions sure did.

[muddler]

No, but their actions sure did.

More than anything it is big government making it next to impossible to conduct profitable business.