Whole lot of Jobs, but not much money
Jobs Aplenty, but are they Costing Too Much?
There really is no question but that the job market under Obama has improved. This is obvious. A huge number of jobs have been added since the Great Recession, of this we should not be uncertain. The real question is what kind of jobs are these, how much are they really paying, and last but certainly not the least, how much are these jobs really going to cost the nation? This last question is what really determines just how valuable these jobs are overall. It is a terrible thing for people not to have money. We all know that at one time or other. We want jobs, we want America to prosper, heck we want the entire world to prosper-what kind of heart would be that which would deny prosperity to anyone? But in the end we have to be real, because in that way can we really know what’s worth what.
As we have mentioned many times before, the jobs we see created today are being created artificially. They are being created because the Administration, along with the congress is forcing the economy to create these jobs through all kinds of artificial economic stimulus and management. These jobs are not being created by the economy itself acting as a free market under authentic free market principles. This is critical to understand. There is an active force in the government, and elsewhere to create these jobs whether there is really a true need for them or not. In essence, for a ton of reasons, we are seeing jobs created because without them the nation would probably become unstable.
But the next question is what is the price of these jobs being created, and just exactly what else is going on behind the scenes? Things are really not what they seem at all, and if things were better there would be no point for this particular post at all. For all the appearances, it is more than likely that the very next president is going to be handed a very badly hurt economy, and unlike Barack Obama, who still had money in the bank enough to bail out Wall Street, the next president may not have enough gas in the tank to do anything about it.
The reality is confusing
The situation for the American economy must be confusing to the average person and there are many reasons why this would be. For one, the mass media is not really focusing too much on the real problems that our economy is facing. It is, in most cases, whitewashing the reality. There will be arguments as to why this is happening, some will say that it is best not to depress people for they will stop spending, and what good will that do? Others will say that the Media does not want to tell the truth because advertisers might not like it. Yet others will offer other opinions more disparaging, but we will leave those out for now. However, the truth is that the American economy is not being discussed in detail before the American people, and that is a problem which will have consequences.
It all looks good on top
At this time the American economy is benefitting from all the stimulus packages that have been thrown its way. Obama and his administration have stopped at nothing to stimulate this economy and for the most part it seems to be working, at least superficially. There are jobs available, not the best of course, but they are there and this is helping to increase basic circulation at some level. People seem to be more hopeful that things are starting to get better. Even if they are not where they want to be today, especially the younger members, there seems to be some hope for the future. Though we are all aware of the weight of the Great Recession still weighing down the economy, there seems to be a sudden movement towards improvement. The economy is still struggling and this is evident, but in general the surface of the economy, helped along by positive Media broadcasts, which tend to paint an “improving” picture, seems to most people, to be on the mend. However, that is not the reality that is daily perturbing the foundations of the American economy.
We have Borrowed Enormous Sums Which Will be Paid Back!
This reality is much more somber and much more frightening, and very little discussed. The simple truth is that all the motion we see above is due to nothing more than credit. We have borrowed and spent gigantic amounts of money. Both the National Debt, and the State and local debt are staggering. Moreover, corporate debt is also gigantic. It is actually at record amounts. The same is fast becoming true of personal debt, as it too is beginning to soar.
But this is only the tip of a giant iceberg. The reality is that these conditions are not only to be found in the United States, but globally. This last reality is perhaps the worst. Nations all over the world are today facing staggering debts. Perhaps not as bad on a personal level as in the United States, for example the Japanese are not likely to develop personal debt on the level of the ordinary American, but in all other ways the Japanese debt, just as an example, is as bad as the US debt in as far as it applies to National, Local and Corporate. The same is virtually true for most of Europe. Britain, France, Italy, Spain, and many others are facing gigantic debt loads. Even Germany is under the gun.
Now all this debt was supposed to stimulate the global economy and get the national economies interacting with one another so as to create a gigantic boon to all involved. Problem is that this idea has, as of this moment at least, failed. We are not seeing a burgeoning global economy, rather we are seeing a growing global debt that is mind boggling even to mathematicians. Moreover the complexity of this debt, the extent of the securities needed to keep it from collapsing, for example the Credit Default Swaps etc, are innumerable. They are really quite intimidating, even to a mathematician if he or she were to try to make sense of it all. Lucky for all that computers are available. However, computers are very good at keeping records of transactions but are not likely to make any of this debt go away.
Global Stability Becoming Undone
Worst of all, global political stability is also endangered. The truth is all of our problems in the Middle East have now gone beyond that region and are now affecting other areas including Europe and Asia. Although we will not here go into detail over these problems and how they are affecting the situation, some knowledge can be gathered from our article on Foreign Policy Going Nowhere. But in general the political situation is now degenerating far from the middle east and has in fact involved many nations for quite some time now. The global economic strategy is not working! And this is scary because the future vitality of our own economy is inextricably tied to the success of the global economy.
The average person cannot really see this because prime time media is not making the connections clear. However, the situation is anything but rosy. We are now living only on credit, and indeed some parts of it are probably illegal. There are a few who maintain that actions taken by the Federal Government to stabilize the US economy are in fact illegal and contrary to the foundations of our national laws. Take that as you might, the general situation is quite dangerous.
In general we are seeing the global economy come apart but as a nation we are so well insulated “Intellectually” from the rest of the world that little of the fundamental significance is coming down to the ordinary person. The solutions now pursued are really little more than the old ideas of George W. Bush and his Neo-Conservative supporters: increase in all ways possible economic activity, regardless of whether these increases are going to be beneficial in the long run. Its little more than a capitalist’s leap of faith.
Our representatives not much endeared to the classical ways of thinking. It seems as if these people who are trusted to lead our nation have little respect for the traditional ideas that have shaped society thus far, and without that they would not be expected to see what is really taking shape here. Their answers to our most serious problems seem tenuous at best.
Inflate the Population Increase Demand
For example when it comes to our national debts and to the general national economy ,one main idea-besides infinite credit- seems to be that by pursuing a course that inflates our population rapidly(and illegally if need be) we can increase the lower level economic activity by forcing an increase in popular demand for products and for real estate, and have the added “benefit” of decreasing labor costs as more people are available to work for less. These same newcomers it is expected will increase the tax receipts as the newcomers too are expected to pay taxes on some level. In some devious minds the idea of having more people pay for the existing debt has blossomed to a full grown economic theory(even while others who are dual citizens are looking to run from the U.S. debt burden by abandoning their American citizenship.)
But in reality, this plan is inane at best, terribly destructive at worst. You cannot simply inflate the population by any means available and expect that this by itself is going to make the economy stronger.
Its much like a swing, if you push at the right time you will add to the momentum of the swing, but if you push continuously, you will too often negate the momentum. The same is true with the population of a nation. Inflating at the right time will add to the economic momentum, inflating at the wrong time could result in a larger population struggling to find the means to support itself.
Meanwhile the Tax burden on all those who live and work in the United States will eventually become quite painful on average, as each week taxation takes a large bite out of every workers paycheck.
Few are the people who benefit from this.
Good or Bad, Little Chance for Change in the Near Future
There is absolutely no reason to expect that our present economic recipe does anything but serve the few recipients of all this money at the very top of the economic food chain. We will not only not be able to pay back our present tax bills in this way, but rather we are going to increase our deficit dramatically in order to assimilate all the newcomers if indeed we plan ever to make the nation viable again.
Sure the short term effects of inflating the population are going to be an increase in demand, and an increase in the circulation of money on the consumer level, but the long term effects are going to more than negate these immediate effects. In fact, the present problems we are seeing now are in large part due to the expansions under George W. Bush who had the same exact idea in mind and who during the tenure of his presidency allowed the Nation’s population to bulge rapidly mostly through illegal entry. For awhile, along with the increased credit availability there was a short term economic surge, but then the benefits retracted. The thinking seems not have changed substantially when we put away the theatrics of both parties.
Long story short, the situation is not well, for in due time all costs will come due. Aside from the temporary increase in the circulation of money that we are seeing here, as more of it is finally reaching the lower echelons, in the end the overall state of the economy has actually become more critical in the past few months as global stability has begun to degenerate in earnest.
Most people are seeing the circulation of money increase, but few of them are aware of the forces behind that increase, and fewer still realize just how much of that money is going to have to come out of their pockets eventually. It is not likely that the Obama administration, or the Democrats are going to try to reverse direction any time soon. At this point they are committed to the end. So it’s really very unlikely that we are going to see anything change substantially. There has been some talk of tightening lending standards, but that seems to be a suicidal thought at this point.
Rather things are going to probably continue along the general path that they have been on for the past ten to twelve years only because reversal is not an option, at least not for the two main parties. Any reversal now will require that the American people be fully informed of the consequences, and neither the Democrats nor main stream Republicans are in for the beating that this reversal of policy will entail.
The Conservatives of course, have long mouthed their grievances and for them reversal of these policies is the only option and indeed they are the only political party that can ever hope to reverse this all out commitment to global expansion, be it good or bad. But that would require that they convince the American people of the necessity for a general reversal of the loose credit policies, and that will not be easy. Few people in the United States are going to want to hear about the possibility of difficult times ahead.
When the Music’s Over….
The game plan is on. There’s very little reason to see it change. The idea is for the United States economy to expand to the maximum, and then deflate it enough to keep it stable. However, the global economy is expected to do the same, yet this does not seem to be happening. Wars and instability are springing up everywhere.
Barring a win by the conservatives, or the main stream Tea Party in 2016, there is little chance that we are going to see any “right” moves towards our salvation, or any reversal of the current policies since any such reversals are going to mean a great deal of pain for all involved and probably much instability. The only thing we can expect is to continue on this course until such time as natural law intervenes with a crisis-how long that takes is difficult to say. True to form we have seen crises develop during September and these crises are continuing. But due to the insulation provided by the Media few Americans are fully aware of the dire implications to the economy.
These crises that we have seen develop over the past few months are probably only the start of more serious problems and sooner or later it will become impossible to cover the significance of these events as they relate to the economy even if they are far away. Indeed, the crises in the Mid East and the Ukraine may for awhile serve our political leaders in that they hide the true scope of the danger to our economy. As for example ISIL is described as a military threat with little mention as to how it can impact the availability of oil.
But sooner or later, it will become impossible for us to ignore the implications and impact on the general economy. At that time, we will have to see what options are available to us, if any. When we do reach a crisis all political party disguises will probably be lifted and the truth will come out, and the blame game will begin. Whatever needs to be done to survive such a crisis will at that time be tried, whether it succeeds or not is another question.