IS THE ECONOMY GOOD FOR YOU?

So, did the train wreck? Is the plane still in the air? When will the dog give its notice to move out?

Recessions are usually defined as two consecutive quarters of negative Gross Domestic Product (GDP) “growth”. Better said, two consecutive quarters of real declines in GDP. Odds for a recession are approaching 50% for 2008. The Author thinks they are a little higher than that. Here’s why:

1. What’s left to grow? Stocks are overpriced by historical measures. The real estate bubble burst. Commodities are high, but a recession will kick them back a few notches.

2. Where’s my wages. Wage growth has been stagnant for quite a few quarters. Unemployment rates have recently crept upwards. Figures out in the last few days peg unemployment at 5%, the highest since 2005. And inflation takes more to buy less.

3. Liquidity? What’s that?

And those are just the problems of the next couple years. It looks worse further out.

This country is on a collision course with fiscal reality. Tax revenues cannot support current spending. Tax revenues cannot support estimated growth in current discretionary spending. Tax revenues have no hope of supporting non-discretionary healthcare and social security entitlements in the decades to come.

And the government lacks the political courage to match revenues to expenditures.

The US is at no current risk of default on its obligations, Treasury Bonds, Treasury Notes and Treasury Bills. But couls it ever happen? Does the decline in the dollar tell you anything? Is it going down because the faces and the colors on the Euro are more interesting?

BLAME CANADA. BLAME THE MEZCANS. BLAME THE CONSPIRACY THEORISTS.

On Morning Edition on National Public Radio (1.2.2008), there was a segment that interviewed average people along Interstate 10. (In a weird coincidence, the Author was driving on Interstate 10, New Year’s Day, driving home from Tempe, Arizona. The Author attended the Insight Bowl on New Year’s Eve Day where the Indiana University Hoosiers football team played Oklahoma State.)

Three women were interviewed for the segment. The first was an assistant manager from a convenience store in Sonora, Texas. She was a single mother struggling to raise kids. Her kids had no health insurance. She was getting financial assistance from her father. The interviewer asked the single mother what was the biggest political issue as she sees it. Was it the Iraq war, economy, healthcare? (Healthcare would have seemed to be the most salient point with the woman. Every other First World Nation in the world provides universal healthcare except the US. Might that not be a solution to her problem?)

‘No’, replied the single mother, it was illegal immigration. She claimed that the Mexicans were getting all kinds of welfare services that she could not get. The interviewer told her that research shows that illegal immigrants do not have access to many welfare services.

The woman then stated that she sees lots of “them” with nice cars. Isn’t that the same thing Ronald Reagan said in his race-baiting comments about the so-called “Welfare Queens” and their Cadillac’s? The single mother probably never considered the fact that immigrants work very hard and live very frugally. She probably sees no irony in the fact that she lives in a town named “Sonora” in a former Mexican State.

Another interviewee lived in Beaumont, Texas and works for the local newspaper. She is very close to retirement age and is not yet engaged in the 2008 political races. But as someone that works for a newspaper, she did note that she “understands” the issues.

Finally, the segment interviewed a nurse that lived in Mobile, Alabama, another city along Interstate 10. She was a resident of New Orleans but was forced to move when Hurricane Katrina destroyed her neighborhood. She still considers New Orleans “home”. She commutes to New Orleans to work as a nurse because the salary is twice as high as in Mobile. And, she stated, as a healthcare professional, she considers healthcare one of the top issues in the next political races.

WHY BOTHER MAKING AMERICA A BETTER PLACE UNTIL WE GET A BETTER BUNCH OF AMERICANS?

One of the Author’s most cynical and morbidly keen observations regards the futility of providing “better” education to American kids. Why spend more money to provide kids better education until we get a better crop of kids? It is that pellucid. The Author would not have recommended spending more money to educate his sub-moronic cohort in the 1970s, nor his predecessors or the ilk that came later. Or the flotsam and jetsam presently hulking around Play stations and their pandering parents.

It is not simply that the Author is cynical about the future of America. Or that he is disappointed with the current state of affairs. That would be too conventional, too conducive to simply spouting platitudes in a mawkish and pious voice. That is what the current leadership, economic and political, wishes Americans to do. Cuss at the traffic, “high-five” their talk radio host, worry about their fantasy football teams and blame the scapegoat de jour. Put a flag sticker and a yellow ribbon on their autopmobile bumpers. Use their charge cards if they lack sufficient cash for gasoline.

Just keep electing and reelecting us. We know they are bums, but we do not through them out. And even when we do, they still have the Senate filibuster.

But that is more than political misdirection. It is the corrosion caused by self-deception.

Bellum omnium contra omnes. (the war of all against all.)

THE WAR OF SOME AGAINST THE OTHER.

In the mid-17th Century, the English philosopher Thomas Hobbes saw the condition of humankind without a civil authority as “bellum omnium contra omnes”, “the war of all against all”. To avoid this chaotic state, humans enter into a “social contract”, giving up some liberties to live in a stable society. That is ostensibly why there are governments.

But the contract is unraveling. It was probably not that great in the first place. Women were excluded for the first 150 years. Black Africans were interned at hard labor so rich white Royalists in the South could extend the “natural order” of Feudal rule.

No, the “social contract” is tattered at the edges and faded on the page. Crony capitalism and upper-middle and upper class sense of entitlement belie the claims of a “classless society.” Liberties erode while stability decays. Little wars placate the “arm-chair warrior” and obfuscate the breaches of the social contract.

Why, in the midst of all this, spend public dollars to privatize privilege? Why, in the wake of all of this, throw more pearls at the “more equal” swine. Why, with the prospect of all of this, incentivize the continuation of the kleptocracy.

Or, given the Iowa Caucus victory of Mike Huckabee, enact the National Sales Tax masquerading as the so-called “Fair Tax” and accelerate the transfer of the nation’s wealth to the richest Americans.

Lessons are cheaper to learn in lean times. Hard times create hard realities and make for hard truths. Do not dim the glare and harshness of high noon in America. Come clean with the Kids.

And save your money, America. You’re gonna need it.

IN THE BODY OF AMERICAN POLITICS, AS W.B. YEATS WROTE IN 1939 IN THE POEM “THE SECOND COMING”, THE BEST LACK ALL CONVICTION AND THE WORST ARE FULL OF PASSIONATE INTENSITY.

BUT IN THE DESERT OF THE REAL, WE WILL STRUGGLE TO THE END TO BE THE BEST, STAND WITH AND BY OUR CONVICTIONS, AND EMPLOY ALL THE PASSIONATE INTENSITY WE CAN MUSTER.