“The U.S. declaration of war against terrorism that followed the September 11, 2001 attack on the World Trade Center and the Pentagon, like so many previous trumpet calls, pushed economic and governmental reform agendas to the sidelines. The reverse side of the coin, also widely remarked upon by historians, is that wars, especially ones with bold new dimensions of geography, expense, and technology, have played critical negative roles in the ebb of previous leading world economic powers. Reform then returns.”
---Kevin Phillips, "Wealth and Democracy"
This reminds me of the concept of devolution. In reality the 2 party system seems to be working at creating some sort of balance. When war happens, the federal government grows in its power. It centralizes power (money) toward a national project. What appears to be a "capitalistic" economy is really an economy that provides the government with what it needs to do its job. In the case of war, the American economy revolves around the production of war machines and technology. People don't see this as a "liberal" relationship, one that puts money and power in the hands of the federal government.
Part of the reason is that the states have been left to pretty much function as they wished, whether is was self-financed, or federally financed, such as the state of Arizona. The problem is that the states have not shifted in their spending habits. While Bush gave us tax cuts, he also waged a war. We paid the federal government less, but did not pay our states more. We still lived according the “surplus” budget, which financed all kinds of projects.
So, the states want their money they were promised. Tax cuts in everyman's pockets made people spend a lot of money. That was good for the economy. It made everyone spend more. The stock market was booming, people were buying homes. Homes were going up in value causing people to cash out equity in their homes. Those same people are being removed from their homes because they “invested” in the “American economy.”
As the information that the economy was heading for a landslide was brought to President Bush, he repeatedly stood up in the media and said that “The American economy is strong.” Another example of where the man refused to pay attention to the big picture. Either his ego really was that big, that he would not admit or take responsibility, or he was just plain stupid, meaning ignorant on purpose.
Now America is waking up to its economic crisis, which is based on poor decision making by her leaders, starting at the very top. At the same time she is shaking her fist at the federal government, either demanding its share of the bailout, or denouncing any bail out whatsoever.
Now we have a new president. He is a “democrat.” The House is in “Democrat” control. The House has passed the “economic stimulus package” put forth by our new president. Now it goes to the Senate.
So we are experiencing a shift. We are moving back into a left wing interpretation of the Constitution. This has happened before, and is not surprising, given the effects we have seen from a government leading from the right.
Just like a pendulum it goes, swinging to extremes away from the center, each shift a perfect response to the energy exerted by the swing that polarized it.
Like a pendulum, I hope, we are seeing a decline in the speed of things, allowing us to glimpse the center, to be drawn to the center. When a pendulum stops, it can rest, and if one riding it chooses, one can look around and see the world as a whole.
Hopefully, as things to come make themselves known in this new shift, we will see a recognition that war is not to be declared lightly. This is perhaps going to be the hardest part for us. We can’t afford anything right now.
Our people can’t afford not to work, we can’t afford health care. We are losing our own freedoms to pursue Life, Liberty and Happiness, yet our country’s recent foreign policy agents have set a precedent that it is America’s job to intervene in wars between other nations.
Regarding the economy, I am impressed today as I see all the changes that are being made. $400 million of the package is going to companies choosing to “go green.” Global warming is the core of the economic stimulus package. That is only one aspect of the president's investment in making us a "green nation."
Al Gore delivered “an inconvenient warning” today, and Hillary Clinton declared America as “serious” about fighting the problem of global warming. Al Gore made a case for connecting the economy of America to investing in combating global warming. I for one, agree with him.
Shifting the money to companies that need to change the way they do things to ways that minimize damage to our planet will cause a huge need for people to implement these changes, on every level, from executive to worker bee. That means more jobs. More technology will soon become available, and the rest of world will see us progressing toward a better future, and will likely follow suit, as well as buy our technology.
What people seem to fail to see is that the whether the government spends or does not spend, it spends. Tax cuts or no tax cuts, the people pay, for all of it. The war, the bail-out (which was passed before O Bama entered, he is just making the rules about what to do with it), healthcare, education, all of it. O Bama’s package is not just about spending. It is about making our money work for us, and it is potentially buying the human race a few more thousand years.
Tighter control goes to the one who has the most money. Right now it is the federal government, therefore it decides where to invest. The states will respond accordingly, and shift in order to qualify for federal funding. That means laws will change, technology will change, education will change, all according to the “vision” of our executive leader.
There are some who think the president doesn’t have any control, that he is simply a puppet of larger entities. So far, in the little time that O’Bama has been in office, I have seen a major shift in the direction of the flow of the fuel that powers America, money. Let’s see what Americans are made of. If we ever had a chance at changing things for future generations of Americans, it is now.
I for one am optimistic because I think that the newly elected leaders will take responsibility for their roles, and they will execute in the manner that will best serve Americans, and the world.
-:-
I was trying to be nice. I am sitting here recovering from my surgery and on drugs and I read this. At first I was hoping that I miss read it or it had something to do with the pain killers, but I can see that this nightmare is true. How can taxing companies more and then giving them next to nothing back and forcing them to go green going to make more jobs? Also there was far more wasteful spending in the house bill and next to nothing that was there for help fix the economy. I would be happy if we went more green out of a choice not out of force. Thank you for the blog it was well informative. Have a good weekend.
"Something given has no value"~Robert Heinlein
"Having been poor is no shame, but being ashamed of it, is." Benjamin Franklin, Poor Richards Almanack, 1749
What if energy companies continue to dig in their claws by spending more on anti-change PR campaigns than on actual reforms? Liberals see a choice between Earth on our side and selfish corporations on yours. This is what Democrats in Congress say:
Source: http://globalwarming.house.gov/tools/2q08materials/files/0045.pdf
By forcing greedy behemoths like ExxonMobil to compete without trashing the planet, Obama will funnel money towards companies that spend less on their executives and thereby create jobs. Of course Big Oil employs lots of people and has economies of scale, but environmental concerns demand regulation and there are reasons to think we'll see more jobs as a result.
I hope your recovery is going well!
The fact that ExxonMobil has not requested a bailout and has continued to due good is good for them. I would like them to be greener and they are now invest 10 million in alternative energy which is better then where they stood in 2005 when they were not looking at any alternative energy sources. Now they are invested in the new lithium batteries and better engines. Mind you these are both safer bets but it is a start. So how would you them to invest? Would you want them to turn over all there profits and only spend on green ideas? If I invested in Exxon I would want to see my investments grow. Also I am not sure but they may have seen this recession coming and instead of raising the price of gas they can afford to keep it low. Normally when you have inflation of the dollar as high as we do now you have higher gas prices. We right now have lower not as low as I would like but it is still lower. Also you source is from back in may of 2008 many things have changed since then for one the off shore drilling band has been lifted. We are in a full recession. The reason why they are not spending large amounts of their profits on renewable energy is because as senior vice pressident Mr. Simon of exxonmobil said in your source
Would you rather have them waste the money on useless alternative energy sources. If they wasted all their profits on wind researcher and it lead to a big waste would you like to have the tax payers bail them out or would you say let the fold and go under. I say let them take there time we need a big jump in order to move alway from oil and that will not happen anytime soon and no amount of money will change that. We need people with big ideas and plans that are not vague.
Thank you for wishing me a speedy recovery.
"Something given has no value"~Robert Heinlein
"Having been poor is no shame, but being ashamed of it, is." Benjamin Franklin, Poor Richards Almanack, 1749
Would you rather have them waste the money on useless alternative energy sources.
Yep! I would much rather that company 'waste' some of that 100+170 million bucks each year on research and investment into clean energy sources instead of propaganda and five insanely rich dudes. They could sextuple their 'save the planet' budget just by lying to us half as much. I think it would be prudent for our government to force such changes even from a narrow self-interested view, because we seem to be addicted to oil.
By your logic an addict needs a big jump in order to move away from drugs and that will not happen anytime soon and no amount of money will change that. Therefore, he shouldn't invest in any treatment. If the addict is really, really sick then treatment can wait, but when the addict is buying caviar and private jets this argument starts to look like an excuse.
You brought up ExxonMobil not me my friend. Also I have not seen or heard them buying any new jets for their CEO's. As a company they are held accountable to the stock holds which means those profits need to be re-investment wisely according to the what the whole company wants not someone who has no connect to the company wants. If your college of choice took your tuition and and instead of rebuilding the dorms that are falling apart they spent it on new recycle bins would you be happy. Especial if the old recycle bins were still good. I am petty sure that you would be up set with your collage for leaving you in a draft and leaking dorm room. The investor in the ExxonMobil company want returns and investments that will payoff not wasteful spending.
"Something given has no value"~Robert Heinlein
"Having been poor is no shame, but being ashamed of it, is." Benjamin Franklin, Poor Richards Almanack, 1749
The more I read your blog, the more I disagreed. I'm going to go through each of your paragraphs and comment on nearly everything I disagree with and explain why. So, fair warning: this will be a long comment.
In war, the economy may revolve around producing war machines, but that’s because that's what's in the highest demand- and that's good for the economy. That's not the appearance of capitalism, it is capitalism. It may appear that the economy is putting “power in the hands of the federal government because” only because they happen to be the biggest spender. But who cares where the money comes from? It puts money into the economy and enriches all of us. Anyway, this is all a moot point. We are in a war, but we are not in a war economy. The scale of this war is far smaller than WWII and the economy did not significantly expand to meet the military's demands.
I think that our economic crisis started with subprime mortgages. The only way one could blame this on the "top leaders" is by calling for more oversight, which I agree is necessary. There are several other groups and practices that need to be blamed for the crisis as well: greedy bankers, irresponsible consumers, and centralization of power (and perhaps, according to some theories, the NAACP). The government's role in causing the economic crisis was not the only or primary one.
Good way of putting it. I like that. Though- this means you agree that the current new administration may be just as extremist and bipartisan as the last?
No, it's not. I am not impressed with this stimulus bill, because the WSJ estimates that only 12% of the spending put forth in it can actually be classified as stimulus. The rest is a waste, and that includes the global warming bits.
I am not a global warming denialist, nor do I oppose green initiatives. But there are appropriate times for addressing important issues like these and this is not that time. If we want to do things to make our future better, we have to get there first- by getting through the present, and the present demands that we fix our economy. In other words, let's focus on global warming after we get out of this mess.
Our economy needs stimulus. "Stimulus" is not just any sort of spending- it's a very specific type. Stimulus spending will produce either jobs or wealth. While investing in some green initiatives will create jobs (like building wind farms), investing in technological research- as Al Gore advocates- will probably do neither of the goals of stimulus, especially in the short run (and, as I said before, our urgent focus at the moment should be on the short term).
Such a short quote, yet so much to say. First, refer to the previous paragraphs. Then, please read my last blog, which, if you can get past my uncontrollably exasperated and angry tone, is extremely relevant to your blog in general.
Rahm Emmanuel said something similar to this along the lines of "major crises allow us to make major changes." But I have to repeat: we cannot lose focus right now, and our focus should be on fixing the economy. This is the worst time to lose focus by pursuing future "change." Let's do that later when the economy is better.
Overall, I disagree with your assessment that the war is central as an underlying cause of the bad economy now. I also disagree that global warming investment is at the core of economic recovery. I guess that means I disagree with both elements of your thesis and therefore the entire jist of your blog. At least this will spur good discussion, and good discussion will lead to good changes...
PS- Did you notice that you typed "O Bama" instead of "Obama?" Is that some sort of weird glitch or was it purposeful?
First, thanks for all who have shared their thoughts, and I will answer them individually soon. Tolkein, I am sorry you were not feeling well and that my blog made you feel worse.
I admit there are some scary things that pop into peoples' minds when faced with realities like this. Reality is that whether you or I like it or not, The bailout wall street wanted is going to global warming. That means, if anyone wants their cut, they have to go green.
Here is more of the essay my original blog was in response to:
"J.RT. Hobson, a radical British economist, theorized in 1902 that, “It has become a commonplace of history how governments use national animosities, foreign wars and the glamour of empire-making, in order to bemuse the popular mind and divert rising sentiment against domestic abuses.” As an explanation of the wars that undercut the Spanish, Dutch, ad British, however, Hobson’s analysis is too sweeping. Hubris and triumphalism can gestate from history and culture, not just through government manipulation…
What changed in 2001, even compared with 1990-91, was the Republican aggressiveness in using the patriotic mood set off by the terrorist attacks, under the guise of “stimulus,” to enact controversial legislation on behalf of corporations and the top income percentiles. The tax cut passed by the House of Representatives – not only repealing the Corporate Alternative Minimum Tax, but giving corporations like IBM and General Motors a total of $25 billion in rebates for past AMT payments – produced a backlash that included analogies to war profiteering…"
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Okay but the 2001 tax cut for the higher tax percent brought us out of the recession that we were in in 2001. So lowering the tax rate on the higher percent brought us out of a recession that was really bad. Just one example of how lowering taxes on the top help everyone.
"Something given has no value"~Robert Heinlein
"Having been poor is no shame, but being ashamed of it, is." Benjamin Franklin, Poor Richards Almanack, 1749
"Barack Obama's Plan to Stimulate the Economy and Protect American Families Would:
* Provide an immediate $250 tax cut for workers and their families.
* Provide an immediate, temporary $250 bonus to seniors in their Social Security checks.
* Provide an additional $250 tax cut to workers and an additional $250 to seniors if the economy continues to worsen
* Provide relief to homeowners hit by the housing crisis.
* Provide aid to states hardest-hit by the housing crisis to avoid a slash in services.
* Extend and expand Unemployment Insurance.
Barack Obama's economic stimulus plan will inject $75 billion of stimulus into the economy by getting money in the form of tax cuts and direct spending directly to the people who need it most. Obama's proposal will immediately provide stimulus using means that do not require lengthy governmental or administrative delays. The plan also reserves an additional $45 billion of stimulus that can be injected into the economy quickly in the future if the economy continues to deteriorate.
A fact sheet detailing Obama's stimulus plan is available here."
http://www.barackobama.com/2008/01/13/barack_obama_announces_plan_to.php
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Yes that is his tax plan but if he want out of the recession he will need to give rich people something. Mostly a reason to spend money and more taxes on them is not it.
"Something given has no value"~Robert Heinlein
"Having been poor is no shame, but being ashamed of it, is." Benjamin Franklin, Poor Richards Almanack, 1749