All in all, it stems from two things the past administration did…
1) Deregulated business to the point of not monitoring our financial capital markets.
2) Taxing too low, so that it became way too expensive for a corporation to reinvest it’s money back into America.
Errors not in philosophy, but in achieving the proper sense of balance.
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September 26, 2009 at 9:02 pm
Nancy Willing
I just read an essay by Michael Lind that gave the historical background of this trend. He calls it neoliberalism. The DLC and third way Progressive Policy Institute of Clinton, Gore, Carper et al. Milton Friedman -> Larry Summers -> and the 1980′s -90′s “systhesis of conservative free-market economics with ‘progressive welfare state redistribution for the losers. ..as opposed to the New Dealers who preferred a high-wage low-welfare society”
Neoliberals liked “dereglation of airlines, trucking and electricity and went along with dismantling of New-Deal era financial regulations”. Robert Rubin -> Tim Geithner.
This is heartbreaking stuff to read but shit if it don’t ring true. We are fucked if we allow Obama to continue into this disaster of a national economic framework.
Lind edits http://www.newamericancontract.net
September 28, 2009 at 12:15 pm
kavips
Let me use your platform to first say that anyone who uses the name neo, is not a thinker.. He is lazy. Second let me reiterate that just as neo conservatism was not conservatism, no doubt, neo liberalism will not be liberalism.. In both cases, it is an attempt to package something new into a familiar box, so that it gets bought…
There is a flaw in his argument.
This is his ideal.
the New Dealers who preferred a high-wage low-welfare society.
That can only occur in a closed system. Global competition drops prices lower and our products don’t get sold… We have no economy, lots of products sitting, waiting for delivery, but no money to spend…
An analogy can be compared to making 40,000 dollars a year, and living on bread and water and saying you are doing fine.. It can be done.. But wouldn’t you rather have some fun things once in a while?
Everyone can make 40% more and spend 40% more for the increased cost of living. What does it gain them?
The secret: the golden ticket: the way to become better: is to make more than you currently spend. That happened during the nineties…. We took money from those making too much and invested it where those making too little, could benefit. With that additional money, they bought products from those making too much, which fortunately for those who were wealthy, made them even more money.
The opposite approach, tried this decade, of giving the wealthy more money, failed abysmally.
September 28, 2009 at 2:45 pm
h.
“We took money from those making too much and invested it where those making too little”
Yikes ……. how much is too much?
September 28, 2009 at 3:02 pm
kavips
Obviously “WE” decide.
October 2, 2009 at 3:29 pm
Nancy Willing
I agree that neoliberal may be a sloppy way to categorize this trend but it is a trend non-the-less that still envelops us.
I just finished reading a similar-veined accounting of how the money policy is skewed against growth economy and jobs and towards anti-inflation policy over:
http://baselinescenario.com/2009/10/02/fed-chest-thumping-for-beginners/
I am less worried about labels than about economic policy that sees a jobless recovery as an adequate measure of economic health.