Thanks for this clip; I could have listened to you extrapolate on any of the topics raised in the interview and hope more media will continue to take advantage of your expertise and mastery of both Big Picture dynamics, as well as informative details and stats.
Of particular interest to me: your points about people feeling exploited and squeezed in an economic system that seems to vaunt ‘capital’ above any other unit of measure. And I heartily concur that in the US, we’ve bred for 20 years for ‘dumber government’. I marvel that any talented, hard-working individuals enter government service today in the US, and I do believe that this ‘dumbing down’ of the political culture has profound economic implications.
Good to see someone put in a good word for CSIRO!!
No one in the US seems to even know about it, nor how it impacts the Australian economy. Made me smile ;-)
spc
I’ve heard about it…
CSIRO is a government subsidized patent troll, collecting rent from innovation of others.
Aussies can do much better than this….
I haven’t heard of CSiro but I do know that Australia has a regulation and competition body, based on the work of Braitwaite or however you spell his name. In other words, government there takes an active role in regulation and competition…basically what Yves does on the competition side, but without the regulatory power.
BTW if you’re reading this Yves it’s funny how after all this thinking and reading I’ve done that I have come around to realizing that I want to do exactly what you do IRL(aurora advisors, that is) but have regulatory power as well. That is the role all governments should have…active involvement in an advisory role in every aspect(from helping business strategically, to telling them when they are not engaging certain consumers appropriately…etc). In other words, insinuating…suggesting…a relatively passive role but with active engagement…ahhhh Yves if only I could sit in on your business to see how you engage your clients so I could learn.
Nice interview! You made good points, and you made them well.
F. Beard
If the problem is excessive debt (and it is) then why not bailout the debtors (with an equal amount to savers lest they whine and complain) while at the same time abolishing the cause of the indebtedness, the government backed counterfeiting cartel otherwise known as the fractional reserve banking system?
sandorgb
In all seriousness, to do so would require a massive grassroots counter-movement to depose both the Democrats and Republican parties, both whom serve the counterfeiting cartel. Given my sense of history, I would not expect this to be likely unless most of the entire country turned into Detroit. Even then, it would probably require a highly charismatic, wealthy, disinterested person to give rise to a third party that citizens would follow, a sort of philosopher-king. Fear is the number one human emotion. It rules 99% of humans. So, the primary political calculation at present is fear. The fear of losing what little one has left versus the probability of being left with nothing.
That said, I believe the counterfeiting cartel will eventually be dismantled as the overwhelming logic of the destructive capacity of excessive debt winds its way into the education of the internet generation. 50-75 years from now, I hope that it will no longer be an issue. But for now, it will have to get worse for people to let go of the fear.
“When you ain’t got nothing, you got nothing to lose.” – Like a Rolling Stone
F. Beard
50-75 years from now, I hope that it will no longer be an issue. sandorgb
It shouldn’t be. I have hopes for 12 years or less since otherwise it will be WWIII if GD I and WWII are a guide.
avgJohn
Some 3 decades ago we established a new direction in economic and trade policy by betting the farm on Milton Friedman-Ronald Reagan “free market”, “trickle down”, “globalization” mumbo jumbo. Maybe with the best of intentions. Some two decades ago, problems began appearing and we entered into a serious state of denial. One decade ago, we began to seriously tinker with government collected economic data that didn’t support our trade/economic policies, and introduced band-aid fed and government action(debt) as short-term, near sighted solutions. And over the last 5 years have resorted to outright fraud, using deception and lies to hide our future economic prospects. The powers that be have too much invested in maintaining the status quo to turn this ship around and head in another direction.
As an example, like the rest of us, the employees of Boeing and Airbus are going to find that their fellow citizens do not give a rat’s behind when their jobs are off-shored to competent, low-paid Asians working in new high-tech, modern facilities. They (Wall Street) have discovered that we have an “everyman for himself” mentality, played the world’s unwashed masses off against one another and have picked us off a few at a time. I know it, you know it, and our politicians know it. And no one is doing a thing about it. (What, this year’s sales of Christmas junk from China is suppose to be reassuring?).
Yves, how about the author’s of these successful economic blogs finding some common ground with each other and teaming up to form a central web site for signing people up for political action to support a focused agenda we can all agree on. I think whether you are on the left, right or in the center, given a limited agenda focused on cleaning up the corruption, crony-ism, and incompetence on Wall Street and Washington is something we could all work towards.
I read these economic blogs with seeming left, right and centrists bents, and have been led to believe there may be more than one way to repair our economy and preserve our freedoms and rights. I may not be an economist, but even I understand when you have an economic crisis such as the sub-prime mortgage meltdown, followed by a no strings attached bailout to the tune of a trillion or more dollars passed in a matter of days, while the economists that head the federal reserve and the federal government claim not to have seen it coming, well, something is wrong with this picture.
There must be someway we could set aside our political differences and all work together on a focused agenda to at least demand a common set of actions to return some semblance of balance in the division of power between the elite and the average citizen.
john
Yves,
Great interview! While there are armies in DC to herald the difficulties of well funded and organized political interests, there is no one with any incentive to look after the workers cut in productivity growth. Well said and keep saying it!
Glen
Great interview!
The Democratic party should start hearing this or they will self destruct in 2012. Voters that have a choice between Repubs and DINOs will vote for the Repubs.
Cynthia
Despite what Tom Friedman says, the global economy isn’t playing on a flat and level playing field until top-executive jobs across America are also shipped to low-wage countries. I would find this to be particularly appealing not only because it would enable top executives to get a taste of their own medicine, as they join their underlings in the great global race to the bottom, but it would also enable our corporations to save hundreds of millions of dollars by not having to pay their top executives more than what the global market demands. But this won’t happen as long as top executives are in cahoots with their board of directors to keep their wages and benefits uncompetitively high, and as long as shareholders are powerless to do anything about it.
With that said, I still think that it’s only a matter of time before the world’s largest companies that produce things other than food and bottled water are headquartered in Asia and all of their CEOs are Asian born and live there, forcing American CEOs to join the ranks of the unemployed.
This is patently obvious to anyone whose head isn’t in the sand.
Power always follows production, which is the heart of any economy. So when American corporations decided to offshore production to Asia so they could teach their greedy American workers a lesson and vastly overpay their CEOs while vastly underpaying their Asian workers, they dug their own grave and engraved their own tombstone.
home
Guv’mint jobs? Talk about dumb US guv funded research?
FDA (part of NIH) oks US Department of Defense to SPONSOR it’s ONLY drug INTERVENTIONAL clinical trial in either Iraq OR Afghanistan for
UK “refined fish oil” for US soldiers, specially invited to enroll, for mood disorders in Camp Tajik, Iraq?
200 Saudi Arabians et al with multiple sclerosis will ALL get natalzumab (aka the only FDA ok’d alpha4beta1 integrin blocking drug) to see if it helps ’em walk? NCT00871780
Thank you, Yves, for an abundance of self-evident common sense. You speak ever more clearly and easily about a new paradigm, which is becoming inevitable as this current system grinds to a halt. This too shall pass.
I found most of this piece just to be a re cap of things already known.
The solution is far more complex and unwieldy than analyzing what got us here. Like to see more of that for a change.
Deus-DJ
You are actually quite wrong. Even if the numbers are known the causes are disputed because of intellectually dishonest losers and the idiots that believe their stupid arguments. Plus, they never want to bring those numbers/issues like stagnating wages up because they will feel it’s a non-issue. You’re right that the solutions need to raised more often, but it necessarily involves politics and some strong backbone. It’s pointless for an intellectual thinking about changing the nature of the debate to bring up the political side when they feel the intellectual arguments need to be changed first.
So again, no.
Deus-DJ
And an aside(me thinking aloud for those that know of Reinhold Niebuhr’s thoughts)…Niebuhr was wrong when he said Polemics are never necessary(saying this later in life). In this intellectually dishonest debate and nobody to know which side is right, it’s time we make people honest by use of polemics. I’m so damn happy I’m somewhat of a socially awkward person, I have no issue going after people and I’m going to love it…
Yves – Once again, great interview. Have you considered a weekly video podcast segment for the blog? Perhaps a week-end breakdown of all the week’s major stories along with some analysis, similar to (the original) Wall Street Week with Louis Rukeyser.
I think you’d have quite a viewership.
Sufferin' Succotash
“Falta de cabezas” was the term used in 17th century Spain as that country went into its decline as a great power. Lack of brains, partly the result of relying too heavily and for far too long on a Plan A (in Spain’s case, a seemingly inexhaustible supply of precious metal from the New World)with no Plan B(which would have been serious internal economic development).
In the case of the early 21st century US, we could substitute cheap oil(and by extension cheap resources generally)for Spain’s gold and silver. Too much of it for too long left the US bereft of a political class capable of implementing a Plan B. The result? The line of least resistance: let the rentier mentality rule, the consequence being national impoverishment and ultimately the loss of superpower status. For “hereditary nobility” and “established church” substitute “bankers and brokers”.
Dan G
Thanks for your work. If changes do not happen soon enough a slow tortuous societal decline continues. The new hybrid socialist goverment with fascists leanings cannot sustain the former capitalistic free market way of life.
If change happens too quickly, we enter a depression that rocks everyone to their senses more quickly, but with a much more devastating short term result.
Possible solutions to at least least some of the questions that are necessary but probably will never happen:
Regarding political contributions, money and elections- The sooner lobyist and special interest are stiphened by law in their contribution capabilities, the better for the masses.
Also, end the war and use the money saved to help support the veterans with jobs and entrenpreneurial grants. Over time, creative destruct much of the military industrial complex companies into more life enhancing companies with the help of the defense department intellectual capabilities. They could assist in the development of a new technological boom in energy to support free market growth. An obvious area for research and development for future survival is safe (small and large) efficient nuclear reactors. Without a sustainable energy source there will be no GDP growth, or growtth period.
Deus-DJ
BTW good job with the interview Yves, you and your interviewer raised the relevant points within a short time frame, well well done.
Joyce
Thanks, Yves, for the best holiday gift to date!
Jack Rip
In support of the clip: I have been working for the same university for close to 30 years. I have done well according most meaningful measures employed or conceivable. I charted my salary over that period and found that my current salary is same it was 30 years ago, corrected for inflation. The salaries of deans, head of schools, VPs and the president have increases in real terms.
Norman
Yves, you said one thing in the interview that caught my ear, that being some people you know who are still employed do the work of 1-1 1/2 man/woman hours. As I remember it, back in the 60’s, that ratio was the norm. Also, wages were raised for those members because they produced value. Alas, the Vietnam War drained the cream from the work force to go fight, leaving those lessor or rejects to mind the store. Those individuals didn’t have the same work ethic, nor did they ever achieve the ones they replaced. Over the years, those same replacements climbed the ladder to which they contributed the mess were in today. As to how this present way of doing business will be changed, until the vast majority of people start thinking for themselves, even boycotting the junk being sold, both in merchandise & political, then it’s down the tubes we go, until perhaps the pitchforks come to the fore.
Siggy
Good interview.
Your view of the factors in play is fairly comprehensive save for one aspect, fiat money and fractional reserve banking.
Political economy begins with the transaction and money is the equilibrator of exchange. As to the current distress, a very large part of it is the result of our fiat money, curiously accepted as a world reserve currency.
It’s not that I’m suggesting that there is a unified theory that explains all, it’s that the despoilment of the currency is what motivates a large part of what has transpired and what is continuing.
Abrogated regulatory and prosecutorial responsibility is the agar that natures this mess that we are swimming in, an unservicable quantity of fiat money derived from profligate credit money.
I’d really like to see a discussion that examines how we might rectify this fiat money problem.
F. Beard
I’d really like to see a discussion that examines how we might rectify this fiat money problem. Siggy
Fiat money is not the problem; fiat is IDEAL for government debts (taxes and fees) since government IS force. The problem is that government fiat is legal tender for PRIVATE debts when it should only be legal tender for government debts.
Conversely, private monies should only be good for private debts. This means that gold and silver, for example, should never be acceptable for government debts since that would privilege them over other private money forms.
bmeisen
Good job Yves. I wish you all the best in your efforts. Just finished Econned and am into Fool’s Gold by Tett.
Assange
Thanks for discussing the House of Saud Yves, you really are a champion of the victims of capitalism.
Doug of North Texas
like bmeisen, finished Econned a few weeks ago and, like the interview, am appreciative of Yves’ intellectual range, a comfort level with more integrated topics than I can even put a label on. The part of the interview involving the neglect of jobs policy / trade balance (compensation – you lose the jobs, but get lousy dead-end jobs if any at all) was especially jarring to me in its clarity and its implied prediction – this ship turned south more than a generation ago and regaining, if possible, is harder than the giving away – trading human capital for goods that are in the trash within months. A tragedy for which our political system has no current remedy.
Doug of North Texas
One conceptual error – the purchases are in the trash, but the debt lives on, magnifying the loss.
M. LaRowe
Yves, Glad to see what you had to say just now.
Sometimes I dont think these interviewers are really asking the right questions. What normal folk like myself are looking for by reading and watching is some concrete action to take to weather the storm. I believe we are in a storm and I’m scared.
I did hope back when Obama took office but….. Finding out that the foreclosure program was “window dressing” was painful.
What I really want and why I’m here trying to deciper what is being said in financial mumbo jumbo is what do I need to do to take care of my family and my community. I see the poverty around me.
I know nobody has a crystal ball but I think there is enough writing on the wall that at least a few folks know where this is all headed. So I’m here, listening.
We have growing local food insecurity. The overworked food pantries are still using their dollars (mostly donated by the shrinking middle class) to provide food assistance so people can pay their bills and eat. (Side note: since 501c3’s are not regulated enough much of their money goes to fund themselves – not help others- more corruption).
So here is my list but it is quite incomplete:
I know a good step would be for me to wipe out my own personal debt. Easier said. But I know we are all going to have to pay the piper at some point.
Trying to be positive but also realistic.
The banks arent going to ever do the “right thing” unless there is muscle making them. The government-business connection is amazingly corrupt, I dont even need to know the details, leave that to the lawyers and authors of the future to explain.
I’m encouraged by the mprtgage bank protests. They remind me of the Civil Rights protests. I like that. Good people willing to be arrested. Meeting in church basements.
I think we pretty much lost our democracy when money became the way to win an election.
I dont believe we have a free press any longer and even if there are pockets of free press there is so much that if the news was still being printed on newspapers we would all be so burdened with paper we wouldnt know what to look at first (what is important is not being communicated to the masses hence no free press).
We are in debt as a country up to our eyeballs and one day I think it’s going to dry us out completely. Having the world’s strongest military is not going to save us from our internal corruption.
I think we may be in the beginning of this very hard period as a country – 10 years at least of hardship depending on how the lawmakers choose to act. This is how I see this.
I remember the stories of my grandparents about the Depression (did it actually have a name when they were going through it?) They were in the South where it was at it’s worst. My grandfather didnt even agree with the TVA plan (personal ignorance?) even though he couldnt stand to eat anymore beans.
Live off the land was a myth even then, though they did try to. If you had a steady job you were extremely lucky, a few were. I am now but I dont want this for my community, it doesnt have to be this way.
So the flavor is differnt but the dish (Depression) is the same. Or soon-to-be worst?
My grandmother said I certainly hope your generation (X) never has to go through anything like this because they are so spoiled they couldnt ever handle it. In a sense I think all of our credit card usage is just holding off the inevitable.
So I read, even when I barely understand the comments here, books I think will help.
My final thought is this – correct me if I have it wrong- I recently read that Dr. Amartya Sen (1998 Nobel prize winner in economics) research found that there is mass hunger when there is no democracy and no free press. In his more recent writings he is urging us to find a place for a “new capitalism” which incorporates public good with capitalistic self interest.
Occasionally I think I’ve spotted a guide. You, Dr. Sen, Noam Chomsky. I’m listening. Thanks for your work.
Thanks for this clip; I could have listened to you extrapolate on any of the topics raised in the interview and hope more media will continue to take advantage of your expertise and mastery of both Big Picture dynamics, as well as informative details and stats.
Of particular interest to me: your points about people feeling exploited and squeezed in an economic system that seems to vaunt ‘capital’ above any other unit of measure. And I heartily concur that in the US, we’ve bred for 20 years for ‘dumber government’. I marvel that any talented, hard-working individuals enter government service today in the US, and I do believe that this ‘dumbing down’ of the political culture has profound economic implications.
Good to see someone put in a good word for CSIRO!!
No one in the US seems to even know about it, nor how it impacts the Australian economy. Made me smile ;-)
I’ve heard about it…
CSIRO is a government subsidized patent troll, collecting rent from innovation of others.
Aussies can do much better than this….
http://apcmag.com/wi-fi-patent-has-turned-csiro-money-mad.htm
http://www.engadget.com/2010/05/21/csiros-patent-fight-targets-more-victims-atandt-verizon-wireles/ 2877-3
http://www.techdirt.com/articles/20100601/1913309652.shtml
http://www.bnet.com/blog/high-tech/australia-8217s-biggest-patent-troll-goes-after-at-t-verizon-and-t-mobile/647
I haven’t heard of CSiro but I do know that Australia has a regulation and competition body, based on the work of Braitwaite or however you spell his name. In other words, government there takes an active role in regulation and competition…basically what Yves does on the competition side, but without the regulatory power.
BTW if you’re reading this Yves it’s funny how after all this thinking and reading I’ve done that I have come around to realizing that I want to do exactly what you do IRL(aurora advisors, that is) but have regulatory power as well. That is the role all governments should have…active involvement in an advisory role in every aspect(from helping business strategically, to telling them when they are not engaging certain consumers appropriately…etc). In other words, insinuating…suggesting…a relatively passive role but with active engagement…ahhhh Yves if only I could sit in on your business to see how you engage your clients so I could learn.
Nice interview! You made good points, and you made them well.
If the problem is excessive debt (and it is) then why not bailout the debtors (with an equal amount to savers lest they whine and complain) while at the same time abolishing the cause of the indebtedness, the government backed counterfeiting cartel otherwise known as the fractional reserve banking system?
In all seriousness, to do so would require a massive grassroots counter-movement to depose both the Democrats and Republican parties, both whom serve the counterfeiting cartel. Given my sense of history, I would not expect this to be likely unless most of the entire country turned into Detroit. Even then, it would probably require a highly charismatic, wealthy, disinterested person to give rise to a third party that citizens would follow, a sort of philosopher-king. Fear is the number one human emotion. It rules 99% of humans. So, the primary political calculation at present is fear. The fear of losing what little one has left versus the probability of being left with nothing.
That said, I believe the counterfeiting cartel will eventually be dismantled as the overwhelming logic of the destructive capacity of excessive debt winds its way into the education of the internet generation. 50-75 years from now, I hope that it will no longer be an issue. But for now, it will have to get worse for people to let go of the fear.
“When you ain’t got nothing, you got nothing to lose.” – Like a Rolling Stone
50-75 years from now, I hope that it will no longer be an issue. sandorgb
It shouldn’t be. I have hopes for 12 years or less since otherwise it will be WWIII if GD I and WWII are a guide.
Some 3 decades ago we established a new direction in economic and trade policy by betting the farm on Milton Friedman-Ronald Reagan “free market”, “trickle down”, “globalization” mumbo jumbo. Maybe with the best of intentions. Some two decades ago, problems began appearing and we entered into a serious state of denial. One decade ago, we began to seriously tinker with government collected economic data that didn’t support our trade/economic policies, and introduced band-aid fed and government action(debt) as short-term, near sighted solutions. And over the last 5 years have resorted to outright fraud, using deception and lies to hide our future economic prospects. The powers that be have too much invested in maintaining the status quo to turn this ship around and head in another direction.
As an example, like the rest of us, the employees of Boeing and Airbus are going to find that their fellow citizens do not give a rat’s behind when their jobs are off-shored to competent, low-paid Asians working in new high-tech, modern facilities. They (Wall Street) have discovered that we have an “everyman for himself” mentality, played the world’s unwashed masses off against one another and have picked us off a few at a time. I know it, you know it, and our politicians know it. And no one is doing a thing about it. (What, this year’s sales of Christmas junk from China is suppose to be reassuring?).
Yves, how about the author’s of these successful economic blogs finding some common ground with each other and teaming up to form a central web site for signing people up for political action to support a focused agenda we can all agree on. I think whether you are on the left, right or in the center, given a limited agenda focused on cleaning up the corruption, crony-ism, and incompetence on Wall Street and Washington is something we could all work towards.
I read these economic blogs with seeming left, right and centrists bents, and have been led to believe there may be more than one way to repair our economy and preserve our freedoms and rights. I may not be an economist, but even I understand when you have an economic crisis such as the sub-prime mortgage meltdown, followed by a no strings attached bailout to the tune of a trillion or more dollars passed in a matter of days, while the economists that head the federal reserve and the federal government claim not to have seen it coming, well, something is wrong with this picture.
There must be someway we could set aside our political differences and all work together on a focused agenda to at least demand a common set of actions to return some semblance of balance in the division of power between the elite and the average citizen.
Yves,
Great interview! While there are armies in DC to herald the difficulties of well funded and organized political interests, there is no one with any incentive to look after the workers cut in productivity growth. Well said and keep saying it!
Great interview!
The Democratic party should start hearing this or they will self destruct in 2012. Voters that have a choice between Repubs and DINOs will vote for the Repubs.
Despite what Tom Friedman says, the global economy isn’t playing on a flat and level playing field until top-executive jobs across America are also shipped to low-wage countries. I would find this to be particularly appealing not only because it would enable top executives to get a taste of their own medicine, as they join their underlings in the great global race to the bottom, but it would also enable our corporations to save hundreds of millions of dollars by not having to pay their top executives more than what the global market demands. But this won’t happen as long as top executives are in cahoots with their board of directors to keep their wages and benefits uncompetitively high, and as long as shareholders are powerless to do anything about it.
With that said, I still think that it’s only a matter of time before the world’s largest companies that produce things other than food and bottled water are headquartered in Asia and all of their CEOs are Asian born and live there, forcing American CEOs to join the ranks of the unemployed.
This is patently obvious to anyone whose head isn’t in the sand.
Power always follows production, which is the heart of any economy. So when American corporations decided to offshore production to Asia so they could teach their greedy American workers a lesson and vastly overpay their CEOs while vastly underpaying their Asian workers, they dug their own grave and engraved their own tombstone.
Guv’mint jobs? Talk about dumb US guv funded research?
FDA (part of NIH) oks US Department of Defense to SPONSOR it’s ONLY drug INTERVENTIONAL clinical trial in either Iraq OR Afghanistan for
UK “refined fish oil” for US soldiers, specially invited to enroll, for mood disorders in Camp Tajik, Iraq?
http://www.clinicaltrials.gov/ct2/show/NCT01216982
Here’s the search link to get that DUMB? guv’mint research,
http://tinyurl.com/2coyjb2
Worse yet? US Department of Defense FUNDS an older French drug for acute spinal cord injury?
http://tinyurl.com/22lcl6n
And NCT00876889 uses riluzole which only increases patient survival for 2 months? Maybe why French aren’t getting this, but duh-Americans are?
http://www.ncbi.nlm.nih.gov/pubmed/13129806
Worse yet?
200 Saudi Arabians et al with multiple sclerosis will ALL get natalzumab (aka the only FDA ok’d alpha4beta1 integrin blocking drug) to see if it helps ’em walk? NCT00871780
http://tinyurl.com/2dwxgwo
Thank you, Yves, for an abundance of self-evident common sense. You speak ever more clearly and easily about a new paradigm, which is becoming inevitable as this current system grinds to a halt. This too shall pass.
I found most of this piece just to be a re cap of things already known.
The solution is far more complex and unwieldy than analyzing what got us here. Like to see more of that for a change.
You are actually quite wrong. Even if the numbers are known the causes are disputed because of intellectually dishonest losers and the idiots that believe their stupid arguments. Plus, they never want to bring those numbers/issues like stagnating wages up because they will feel it’s a non-issue. You’re right that the solutions need to raised more often, but it necessarily involves politics and some strong backbone. It’s pointless for an intellectual thinking about changing the nature of the debate to bring up the political side when they feel the intellectual arguments need to be changed first.
So again, no.
And an aside(me thinking aloud for those that know of Reinhold Niebuhr’s thoughts)…Niebuhr was wrong when he said Polemics are never necessary(saying this later in life). In this intellectually dishonest debate and nobody to know which side is right, it’s time we make people honest by use of polemics. I’m so damn happy I’m somewhat of a socially awkward person, I have no issue going after people and I’m going to love it…
Yves – Once again, great interview. Have you considered a weekly video podcast segment for the blog? Perhaps a week-end breakdown of all the week’s major stories along with some analysis, similar to (the original) Wall Street Week with Louis Rukeyser.
I think you’d have quite a viewership.
“Falta de cabezas” was the term used in 17th century Spain as that country went into its decline as a great power. Lack of brains, partly the result of relying too heavily and for far too long on a Plan A (in Spain’s case, a seemingly inexhaustible supply of precious metal from the New World)with no Plan B(which would have been serious internal economic development).
In the case of the early 21st century US, we could substitute cheap oil(and by extension cheap resources generally)for Spain’s gold and silver. Too much of it for too long left the US bereft of a political class capable of implementing a Plan B. The result? The line of least resistance: let the rentier mentality rule, the consequence being national impoverishment and ultimately the loss of superpower status. For “hereditary nobility” and “established church” substitute “bankers and brokers”.
Thanks for your work. If changes do not happen soon enough a slow tortuous societal decline continues. The new hybrid socialist goverment with fascists leanings cannot sustain the former capitalistic free market way of life.
If change happens too quickly, we enter a depression that rocks everyone to their senses more quickly, but with a much more devastating short term result.
Possible solutions to at least least some of the questions that are necessary but probably will never happen:
Regarding political contributions, money and elections- The sooner lobyist and special interest are stiphened by law in their contribution capabilities, the better for the masses.
Also, end the war and use the money saved to help support the veterans with jobs and entrenpreneurial grants. Over time, creative destruct much of the military industrial complex companies into more life enhancing companies with the help of the defense department intellectual capabilities. They could assist in the development of a new technological boom in energy to support free market growth. An obvious area for research and development for future survival is safe (small and large) efficient nuclear reactors. Without a sustainable energy source there will be no GDP growth, or growtth period.
BTW good job with the interview Yves, you and your interviewer raised the relevant points within a short time frame, well well done.
Thanks, Yves, for the best holiday gift to date!
In support of the clip: I have been working for the same university for close to 30 years. I have done well according most meaningful measures employed or conceivable. I charted my salary over that period and found that my current salary is same it was 30 years ago, corrected for inflation. The salaries of deans, head of schools, VPs and the president have increases in real terms.
Yves, you said one thing in the interview that caught my ear, that being some people you know who are still employed do the work of 1-1 1/2 man/woman hours. As I remember it, back in the 60’s, that ratio was the norm. Also, wages were raised for those members because they produced value. Alas, the Vietnam War drained the cream from the work force to go fight, leaving those lessor or rejects to mind the store. Those individuals didn’t have the same work ethic, nor did they ever achieve the ones they replaced. Over the years, those same replacements climbed the ladder to which they contributed the mess were in today. As to how this present way of doing business will be changed, until the vast majority of people start thinking for themselves, even boycotting the junk being sold, both in merchandise & political, then it’s down the tubes we go, until perhaps the pitchforks come to the fore.
Good interview.
Your view of the factors in play is fairly comprehensive save for one aspect, fiat money and fractional reserve banking.
Political economy begins with the transaction and money is the equilibrator of exchange. As to the current distress, a very large part of it is the result of our fiat money, curiously accepted as a world reserve currency.
It’s not that I’m suggesting that there is a unified theory that explains all, it’s that the despoilment of the currency is what motivates a large part of what has transpired and what is continuing.
Abrogated regulatory and prosecutorial responsibility is the agar that natures this mess that we are swimming in, an unservicable quantity of fiat money derived from profligate credit money.
I’d really like to see a discussion that examines how we might rectify this fiat money problem.
I’d really like to see a discussion that examines how we might rectify this fiat money problem. Siggy
Fiat money is not the problem; fiat is IDEAL for government debts (taxes and fees) since government IS force. The problem is that government fiat is legal tender for PRIVATE debts when it should only be legal tender for government debts.
Conversely, private monies should only be good for private debts. This means that gold and silver, for example, should never be acceptable for government debts since that would privilege them over other private money forms.
Good job Yves. I wish you all the best in your efforts. Just finished Econned and am into Fool’s Gold by Tett.
Thanks for discussing the House of Saud Yves, you really are a champion of the victims of capitalism.
like bmeisen, finished Econned a few weeks ago and, like the interview, am appreciative of Yves’ intellectual range, a comfort level with more integrated topics than I can even put a label on. The part of the interview involving the neglect of jobs policy / trade balance (compensation – you lose the jobs, but get lousy dead-end jobs if any at all) was especially jarring to me in its clarity and its implied prediction – this ship turned south more than a generation ago and regaining, if possible, is harder than the giving away – trading human capital for goods that are in the trash within months. A tragedy for which our political system has no current remedy.
One conceptual error – the purchases are in the trash, but the debt lives on, magnifying the loss.
Yves, Glad to see what you had to say just now.
Sometimes I dont think these interviewers are really asking the right questions. What normal folk like myself are looking for by reading and watching is some concrete action to take to weather the storm. I believe we are in a storm and I’m scared.
I did hope back when Obama took office but….. Finding out that the foreclosure program was “window dressing” was painful.
What I really want and why I’m here trying to deciper what is being said in financial mumbo jumbo is what do I need to do to take care of my family and my community. I see the poverty around me.
I know nobody has a crystal ball but I think there is enough writing on the wall that at least a few folks know where this is all headed. So I’m here, listening.
We have growing local food insecurity. The overworked food pantries are still using their dollars (mostly donated by the shrinking middle class) to provide food assistance so people can pay their bills and eat. (Side note: since 501c3’s are not regulated enough much of their money goes to fund themselves – not help others- more corruption).
So here is my list but it is quite incomplete:
I know a good step would be for me to wipe out my own personal debt. Easier said. But I know we are all going to have to pay the piper at some point.
Trying to be positive but also realistic.
The banks arent going to ever do the “right thing” unless there is muscle making them. The government-business connection is amazingly corrupt, I dont even need to know the details, leave that to the lawyers and authors of the future to explain.
I’m encouraged by the mprtgage bank protests. They remind me of the Civil Rights protests. I like that. Good people willing to be arrested. Meeting in church basements.
I think we pretty much lost our democracy when money became the way to win an election.
I dont believe we have a free press any longer and even if there are pockets of free press there is so much that if the news was still being printed on newspapers we would all be so burdened with paper we wouldnt know what to look at first (what is important is not being communicated to the masses hence no free press).
We are in debt as a country up to our eyeballs and one day I think it’s going to dry us out completely. Having the world’s strongest military is not going to save us from our internal corruption.
I think we may be in the beginning of this very hard period as a country – 10 years at least of hardship depending on how the lawmakers choose to act. This is how I see this.
I remember the stories of my grandparents about the Depression (did it actually have a name when they were going through it?) They were in the South where it was at it’s worst. My grandfather didnt even agree with the TVA plan (personal ignorance?) even though he couldnt stand to eat anymore beans.
Live off the land was a myth even then, though they did try to. If you had a steady job you were extremely lucky, a few were. I am now but I dont want this for my community, it doesnt have to be this way.
So the flavor is differnt but the dish (Depression) is the same. Or soon-to-be worst?
My grandmother said I certainly hope your generation (X) never has to go through anything like this because they are so spoiled they couldnt ever handle it. In a sense I think all of our credit card usage is just holding off the inevitable.
So I read, even when I barely understand the comments here, books I think will help.
My final thought is this – correct me if I have it wrong- I recently read that Dr. Amartya Sen (1998 Nobel prize winner in economics) research found that there is mass hunger when there is no democracy and no free press. In his more recent writings he is urging us to find a place for a “new capitalism” which incorporates public good with capitalistic self interest.
Occasionally I think I’ve spotted a guide. You, Dr. Sen, Noam Chomsky. I’m listening. Thanks for your work.