Posts Tagged ‘Economics’

The Solution is the Problem

September 1, 2017

The most powerful story in the world is the one that says that economic growth is the solution to the world’s social and political problems.  However, using today’s technology, that solution creates a greater problem, the destruction of the world’s ecosystem. That’s  a point convincingly made by Yuval Harari in his book Sapiens; A Brief History of Humankind.

The only time that the rapid rise in greenhouse gases slowed, he says, was during the 2008 recession which caused a slowdown in economic growth. Now that economic growth is greatly increasing greenhouse gases continue to increase. Not only do the wealthy economic elite want the growth to continue, but so do the masses of the world.  When the billions of Chinese and Indians, for instance, reach lifestyle parity with Americans and Europeans, the ecosystem will collapse.

Some believe that evolving technology caused this, but that new technology can also solve the problem.  However, others think for that to happen political and economic leaders will have to cause it to happen.

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My Top Ten Wish List for the U.S. in 2015

January 5, 2015

I wish that…

!.  The United States does not get into another war. 

2. The United  States Congress concentrates on working for what’s best for the country instead of what’s best for members of Congress.

3. The astronomical cost of healthcare stops rising.

4. The cost of education for physicians is greatly reduced, bringing the cost more in line with other countries, many of which provide free education for physicians.

5,  American universities put more emphasis on lowering the costs of education than adding administrators and new buildings.

6.  That we start valuing excellent educators more than football coaches.

7. American news media return to the days of responsible journalism, concentrating more on stories that affect people’s lives and less on sensationalism and that we produce more journalists like H. L. Mencken, Ida Tarbell,  David Halberstam, Edward R. Murrow, Walter Cronkite,  Ben Bradlee, and Woodward and Bernstein. 

8.  That our economy continues to improve.

9 .  That we continue the trend toward producing more renewable energy.

10.  That more of us follow Martin Luther King, Jr.’s admonition that we judge people “not by the color of their skin, but by the content of their character.”

What do you wish most for in 2015?  

 

 

The Price of Ignoring the Lessons of History

June 2, 2014

As I read Doris Kerns Goodwin’s latest historical opus,  The Bully Pulpit,  I become more and more astounded by the parallels between the Gilded Age and now. It’s perhaps a prime example of how history repeats itself.

I just read how President Theodore Roosevelt was blamed by Wall Street for the “Roosevelt Panic of 1907.”  Th big money men said President Theodore Roosevelt’s “crusade against business” caused the crash, arguing that “his excessive regulation had paralyzed the economy.”  The actual cause of the crash was the same thing that caused the Great Recession of 2008.  A very large  investment bank in  New York had abandoned sound banking practices to gamble with customer’s deposits. That caused public confidence in financial institutions to fail, and “customers rushed to retrieve money.” The banks had to be bailed out by, “in the absence of a  central banking system,”  seventy-year old J.P. Morgan, who served as a “one-man Federal Reserve,” and the federal government.  Does that sound familiar?

That’s just one example of the parallels to now.  The book has quite a few more,  including a “do nothing” Congress that wouldn’t pass hardly any bills a progressive president wanted during the last two years of his presidency.

The full title of the book, by the way is, The Bully Pulpit: Theodore Roosevelt, William Howard Taft, and the Golden Age of Journalism.  .

T’ain’t What-cha Pay

November 3, 2013

The lyrics of a 1939 popular music hit said that “T’aint what you do, it’s the way how you do it” also apply to paying people for the work they do, according to a group  of Harvard professors.  A study they conducted showed that simply paying people more did not increase their productivity.  The best results came when employees percieved the increase to be an unexpected gift with no strings attached. They felt they were being payed more simply because their employer chose to do it. They reciprocated by increasing productivity.

You can read the Harvard Gazette story by going to this  link.

HIGHER EDUCATION COSTS ARE DRIVING THE DEMAND FOR LARGER COLLEGE LOANS

October 10, 2012

COLLEGE EDUCATION COSTS FOUR TIMES MORE THAN IT DID TWENTY YEARS AGO.

IT GOES UP TWO TO FOUR PERCENT MORE THAN THE INFLATION RATE EACH YEAR. 

Getting a college education makes financial sense. College graduates, on average, make more money than high school graduates.  However, a caveat must be added. It makes financial sense if you can make a decent living after you have made your payment on your college loan.  A lot can’t.  Many can’t pay back the loans. Loans have gotten larger and larger over the years because the cost of  getting a college degree has skyrocketed.  That was the subject we discussed in our Columbus State University Continuing Education Columbus Academy of Lifelong Learning “What’s Happening?” Class. It’s a current events class.  It was an excellent discussion, in my view, probably because we have a lot of retired educators in the class.   There was one area, though, that got very little attention: why has the cost of a college education skyrocketed over the years?  I decided to Google it, and, sure enough, I found an article that answers that question.  

An article on the NPR website on a report on “Fresh Air” entitled “What’s Driving College Costs Higher”  tells of how the rapidly rising increases in tuition and other costs are forcing students to have to borrow more to stay in school.  Two-thirds of college students get college loans.  The increases are not because of increased pay to professors. Their pay has been stagnant for a number of years. However, another report tells us that is not the case with administrative salaries.  They have been dramatically increasing, and universities have been expanding administrative staffs.

Georgia is one of a very few states that offer scholarships to all students who keep their grades up.  The HOPE scholarship program, funded by the state lottery, has not been able to keep up with the dramatic rising tuition costs and now pays only a portion of the costs.  

It appears that universities need to concentrate more on cutting costs and less on expansion. Why the emphasis on growth? Why is bigger better when it comes to higher education facilities?   One argument is that larger student bodies mean more subjects can be taught.  Some believe, however, it boils down to university presidents striving to increase their status by being president of larger student bodies.  Whatever the reason, cost cutting needs to be getting a lot more attention for the sake of America’s middle and lower class students who are feeling the cost squeeze the most. Massive defaults on paying off the loans – they amount to over a trillion dollars now – could disastrously affect the nation’s economy.  

The Economic Elephant in the Room

February 13, 2012

What the Republican candidates are not talking about in their knock-down-drag- out fight for the presidential nomination is really the biggest problem facing this nation right now, the widening gap between the rich and the poor. Trying to just dismiss the subject by charging “class warfare” does not address the problem, and certainly is not going to solve it.

The class war is over. The wealthy won, just like they did in the Gilded Age of the 1890s and in 1929 right before the Great Depression. But all one has to do is look at history to know that odds are very high that the victory will be Pyrrhic. Prominent Columbus attorney Morton Harris, in his talk to the Unitarian Universalist Fellowship of Columbus, quoted 1st Century Greek historian Plutarch, who said: “Too great a disparity between the rich and the poor is the most fatal malady of a Republic.”

Mort and I, and another attorney friend of mine, Milton Jones, were in the Columbus Jaycees together back the in the 1960s. Milt introduced Mort Sunday. In that introduction we learned that Mort was a pitcher for the Jaycees’ softball team, and Milt was his catcher. I won’t tell you what Milt said about Mort’s pitching since both are lawyers. But I digress. Back to the income and weath gap mess.

Believe me it’s not crying wolf or saying that the sky is falling, or even making a poltical statement. It’s fact. It is really a gigantic problem. As Mort said, “Poverty and the feelings of injustice can become the ‘fuel’ for ‘revolution,’ either at the ballot box or in the streets.

“The risk of too wide a gap is that our country could lose either its private economic system or its democratic political system, or both, if too many are living in poverty and believe ‘there is no way out, no matter how I try.'”

Mort says, “There is too little awareness and even less understanding of this growing ‘Elephant in the Room.'” That’s probably going to change once Republicans nominate thier presidential candidate and the actual campaigns for president start. In the meanwhile, let’s take a look at what created this problem and just how bad it is. Stay with me, and I’ll get into the specifics that Mort passed along today in future posts, and we’ll discuss possible solutions.  If you have any, let me know.

Weapon Words

January 29, 2012

When Rush Limbaugh first went on the air, I listened to him a lot to find out what he was all about. After a while, I totally understood and realized that I didn’t need to listen to him any more because I knew exactly where he would come down on any issue, and because he was repeating himself.  However, the talk I have been hearing recently about being conservative or liberal, and what those words stand for, reminded me of one of his early conversations.

The man he had on the line said he didn’t think it was useful to label people. Rush totally disagreed. He said in such a way – I don’t remember the exact words – that it said to me, No, wait a minute, bub. you’re not going to take that weapon away from me.

And that reminded me of what a salesman and air personality who worked with me at WBML in Macon, Georgia in the early 1950s when I was going to Mercer University, told me about the late racist Georgia Governor Eugene Talmadge.  The salesman said he had worked as a broadcast consultant for Talmadge at one time.  He told me that he asked Talmadge about his race baiting on the campaign stump, “Why do you do that? You can win without  it.” He said Talmadge told him, “That’s my ‘weepon’, son. I can’t give up my ‘weepon.'” “Weepon” was his faux-country dialect for weapon, of course. Eugene Talmadge spoke the flagrant racist redneck of the time, but definitely knew better. He had a degree in English from the University of Gerogia.

I think for most people labeling is often misleading.  Not everyone who is conservative or liberal on some things is conservative or liberal on all things.  Most conservatives I know are definitely for tax supported public education.  They are also for public highways, street lights, traffic lights, libraries, and, actually, it’s hard to find a conservative who now admits he or she is opposed to Social Security, Medicare or Medicade, though conservatives fought them tooth and nail and called them socialistic when they were passed into law.  All of those things could come under the socialism rubric. Does that make conservatives who now support them  socialists?

The truth is that most of us support some things considered socialistic and some capitalistic.  We have, and have had from the beginning of this country, a mixed economy, part capitalistic and part socialistic.  Yes, it has trended more in one direction or the other during certain time periods.  But, as  far as I can discern, it has never been totally one way or the other.

I guess what it boils down to is that some people like to think in terms of things being either black or white, and others realize that most are really in shades of grey.

However, that doesn’t mean the politicians who really know all of that are going to give up their weapon words. I don’t know if that will ever happen.

Looking to China for how Unregulated Corporations Provide more Jobs

January 17, 2012

I recently did my bit to help the American consumer-driven economy. I upgraded to an iPhone 4 and I love it, especially the 5 mp camera with a flash. But, after watching the Daily Show with Jon Stewart last night, every time I look it now, I’ll think about the factory worker in China who made it. According to the report, which got its facts and video clips from a MSNBC program, he or she – some as young as 13-years-old – got 32-cents an hour, lives in a company-owned dormitory room with seven other people, works up to 35 straight hours, and sometimes becomes so stressed out and depressed that  he or she jumps off the top of the dormitory building.  So many have jumped that Foxconn, the Taiwan-based largest manufacturer of electronics in the world, has put up nets to break the jumpers’ falls.  Most of the company’s manufacturing plants are in mainland China.

Why does the union allow this to happen to workers?  There is no union.  Trying to organize one can get you twelve years in the clink.

Last night’s report was prompted by Rick Perry’s repeating of the Republican mantra about bringing jobs back to America by fewer regulations and more tax breaks for corporations.   Perry made the statement during the Republican presidential primary debate in South Carolina.

There was a time when many American factories were almost as immoral, paying starvation wages, providing shoddy company-owned houses, and  using child labor. Regulations got us away from that.  Do we really want to go back to that in order to compete with communist China?  Do we really want to ramp up our march back  to the Gilded Age of the Robber Barons? Can’t we find a way to provide jobs without destroying the American middle class?

Morton Harris Warns of Costly Results if the Gap Between Rich and Poor isn’t Narrowed

November 8, 2011

Morton Harris,  a very smart Harvard educated Columbus attorney and old Jaycee buddy of mine, is alarmed about what can happen if something isn’t done to correct the widening gap between the rich and the poor.  Speaking to Columbus State University students and some faculty members today, he explained the intensity of the economic, political, and moral crisis our nation faces. 

I was going to write a report on his talk,  but after I requested a copy of his speech outline, he not only sent that, but a note that summed it up quite well, so I am going to let him tell you about it in his own words.    

I feel we must do something soon to interrupt the accelerating rise of our country’s “underclass”  which includes not only those living in poverty, but also many retirees, the unemployed and underemployed, and the increasingly strained middle class.

Considering the current fragile status of our economy, a growing “underclass” and an ever more strained middle class will weigh heavily on our country’s economic growth, especially since two-thirds of our GDP is consumer spending.

The key issue as I see it is that although we must deal with America’s growing indebtedness ($1.5 Trillion annual deficits and $15 Trillion+accumulated debt), to do so without raising taxes on the wealthy and ultra wealthy (who do not spend a significant portion of their income on consumption nor invest a high percentage of  their wealth in new or expanding businesses) would necessitate even deeper cuts in government spending, which, during a recession, will only make matters worse.  The possible negative effect on the economy of increased taxes on the wealthy and super wealthy is slight compared to the benefit that can be created by putting people back to work which will take additional funds, i.e., the building of bridges, roadways, dams and other construction jobs which only the government can do. To say that revenues are not “on the table” in dealing with our country’s long term indebtedness may be politically popular with many, but in my opinion, would at this time, be economic suicide for the country and for millions of our Nation’s growing underclass.

In a recent newspaper article about “flash mobsters” in the U.S. there was a comment from one of those interviewed who said, “We should not be surprised to see people using social media for organizing “flash mob” robberies.  You essentially have a world where you have 25 million people who are underemployed and 2% of the population doing better than they ever have.”  He went on to say, “why wouldn’t that lead to some sort of social unrest?”  More recently, the Wall Street protestors are another expression of growing social unrest.  I’m concerned that these expressions may be just the tip of the iceberg of what could happen if we don’t solve this problem soon.

I agree whole-heartedly with what Mort said, and I thank him for sending that summary.  

Saving Capitalism

November 7, 2011

It’s good to know that the huge problem of the immense and growing gap between the rich and the poor and the shrinking middle-class is not being ignored in Columbus.

For one thing, The Banquet on the Bridge organization held its fifth annual banquet on Dillingham Street Bridge Sunday.  According to the WRBL report, a thousand people showed up, a lot of them homeless and underprivileged.  The idea is for a social that mixes the affluent with the less than.  It’s one way of recognizing the growing income gap. (I have no idea why the Ledger-Enquirer ignored this story. Just  attracting a thousand people to a banquet on Dillingham Street Bridge  should have been enough to report why.)

Then tomorrow (Tuesday, 11/8/2011), prominent  Columbus attorney, and old Jaycee acquaintance of mine (the Jaycee thing was about 50 years ago) Mort Harris is going to speak on The Growing Gap Between the Rich and the Poor: A Political, Economic, and Moral Delima What it means for America. That’s at 12:30 to 1:30 p.m. at the Spencer Event Hall at the International House at Columbus State University.  I plan to be there.

Meanwhile, you don’t have to wait until then to hear an engrossing lecture by  Richard Wilkinson on the issue. You can catch it by going to the TED website; just click on this link.

It’s a really crucial issue.  When wealth becomes so concentrated that it adversely affects great masses of people, the  stage is set for revolution, the kind we had when Theodore Roosevelt and his distant cousin Franklin D. Roosevelt were elected president. Thank goodness, for the most part, neither of them were violent.  Teddy – the  Teddy Bear is named for him – who was a devoted capitalist embarked on a program to save capitalism by reforming it, thereby giving average and poor folks a larger piece of the economic pie. FDR, saying he was inspired by cousin Teddy’s reformation, pledge to do the same thing.

We’ll get into more on that in future posts. Feel free to join the discussion. Just click on the comments button  and let fly.