Saturday, February 6, 2010

The American Prospect

Below is my response to "Time Is Running Out," Bob Herbert's February 6 essay in The New York Times:

For most Americans, the economy Bob Herbert fears may develop has been an established fact for some time. The Reagan years marked the start of a steady decline in prospects. Younger Americans and many in middle age have little if any expectation of living better than their parents. The servile grovelling of Obama and Congress at the feet of Wall Street and the Health Insurers are really only a reminder that the US has institutionalized oligarchy in every sense but the constitutional one.

Worse, the uninterrupted militarism of the past 60 years is actually escalating under Obama, hard as that may be to believe. At least medicare and social security unambiguously help Americans, if (perhaps) somewhat inefficiently (certainly no more inefficiently than private insurers do). The obscene military budgets have been blown on needless wars evidently calculated to inflame hatred of the US around the world.

Frankly, the lives of people in Germany look pretty good. They have health care, five weeks of vacation for all, and need not fear a life of abject poverty after retirement. They still value science, engineering and art. And they are aware that it is necessary to live with the rest of the people of the Earth -- a fact most Americans flatly deny.

Below, the section of Herbert's essay that I respond to:

Speaking at a conference here on Wednesday, Gov. Ed Rendell of Pennsylvania said that if we don’t act quickly in developing long-term solutions to these and other problems, the United States will be a second-rate economic power by the end of this decade. A failure to act boldly, he said, will result in the U.S. becoming “a cooked goose.”

Neither the politicians nor much of the mainstream media are spelling out the severity of these enormous structural problems or the sense of urgency needed to address them. Living standards are sinking in the United States, and there is no coherent vision or plan for reversing that ominous trend over the long term.

The conference was titled, “The Next American Economy: Transforming Energy and Infrastructure Investment.” It was put together by the Brookings Institution and Lazard, the investment banking advisory firm.

When Governor Rendell addressed the conference on Wednesday, he used words like “stunning” and “unbelievable” to describe what has happened to the nation’s infrastructure. His words echoed the warnings we’ve been hearing for years from the American Society of Civil Engineers, which tells us: “The broken water mains, gridlocked streets, crumbling dams and levees, and delayed flights that come from failing infrastructure have a negative impact on the checkbook and on the quality of life of each and every American.”

The conference was sparked by a sense of dismay over what has happened to the U.S. economy over the past several years and a feeling that constructive ideas about solutions were being smothered by an obsessive focus on the short-term in this society, and by the chronic dysfunction and hyperpartisanship in much of the government.

I was struck by the absence of grousing and finger-pointing at the conference and the emphasis on trying to develop new ways to establish an economy that is not based on financial flimflammery, that enhances America’s competitive position in the world, and that relieves us of the terrible burden of reliance on foreign energy sources.

I was also struck by the pervasive sense that if we don’t get our act together then the glory days of the go-go American economic empire will fade like the triumphs of an aging Hollywood star. One of the participants raised the very real possibility of Americans having to get used to living in an economy “that won’t be number one,” an economy that perhaps is more like Germany’s.

1 comment:

Mike McShea said...

When I hear Rendell talking about second rate infrastruces, Pennsylvania is already there. He should know.

What started with Reagan was Accounting tricks, outsourcing government jobs. In theory you saved money on benefits using a private contractor, but as we have seen in Iraq, twenty to thirty million dollars for half a mile of paved road is not up to old American first world standards or is that the new American Standard of work and money.

This accounting trickery is and was the backbone of Wall Street that led to the recent collapse. For every CEO getting 100 million bonus, he has one consultant IT person and one Temp secretary in the front office. The traders are all on commission tied to production of money and bonuses. The rest of the operations, the customer service is in Mumbai, the bulk mailings of customer statements are contracted out and in Mississippi and the office mail room is another local outsourced contractor enterprise.

When the Dems bumped a few billion into the economy under Ford or Carter, the economy bounced back in a few months. You saw the stimulus then in hands ready jobs filling pot holes and building roads etc.

Now the Stimulus money, you might as well flush it down the toilet for all the good it ever does for the common unemployed citizen.

It, the real problem, is the accounting tricks and tax tricks and politicians and journalists who have never had a private sector manual labor job who do not understand or see the reality of the present day American economy.