Djcnor’s Weblog

Posts Tagged ‘economy

Face it! There’s a reason why Norway, Denmark, Finland, Australia, New Zealand, Sweden, Canada, and 8 other countries outrank us in economic fundamentals. There’s something they are doing right that we are doing wrong! It’s about time we looked past that label we’ve been taught to abhor …..SOCIALISM!…….and see what it is and ……HORRORS! …… copy it!


What can I say? I feel a responsibility to burst American bubbles, but I have the best intentions. The US needs to come out from behind its willful isolation and out-of-date concepts of how the rest of the world sees the US in order to deal with the rest of the world in a manner that  reflects the reality. Also, according to the article I am about to present, this is necessary in order for the world to come out of the present economic crisis as soon as possible and with as little human suffering as possible. (And the suffering of people outside the US really does matter.)

Here’s the article that led to this post:

Yes, it’s opinion, not a news article, which leaves some room for discounting its points, but doesn’t it make more sense to consider them?

This is the section that made me say “Ouch!”

“Indeed, these days America is looking like the Bernie Madoff of economies: for many years it was held in respect, even awe, but it turns out to have been a fraud all along.”

And this one, “Eeeee!”

“[The economist Simon] Johnson, who served as the chief economist at the I.M.F. and is now a professor at M.I.T., declares that America’s current difficulties are “shockingly reminiscent” of crises in places like Russia and Argentina — including the key role played by crony capitalists.

In America as in the third world, he writes, “elite business interests — financiers, in the case of the U.S. — played a central role in creating the crisis, making ever-larger gambles, with the implicit backing of the government, until the inevitable collapse. More alarming, they are now using their influence to prevent precisely the sorts of reforms that are needed, and fast, to pull the economy out of its nosedive.”

Will Americans believe that the US really has lost a lot of its credibility? Or will they, like a child caught throwing stones at the neighbor’s window, use the defense of “Europe’s got problems just as bad” ? The difference is that Europe has never had that much credibility with most Americans, but the US has had a lot of credibility with Europeans in the past. The loss of that is a major change. American hubris and arrogance will not be tolerated as it has in the past, and that has consequences.

On the other hand, Americans are not likely to tolerate willingly what it might take to get that credibility back.

I know many Americans are worried right now about the huge amount of money being invested in pulling the US out of the economic slump it’s in. Europe is taking a more leisurely approach to relieving the crisis, and the New York Times had an interesting article today that suggests why they have that luxury.

“VIENENBURG, Germany — Last month Frank Koppe gathered together all 50 of his employees at Koppe-Apparatebau for coffee, cake and the kind of bad news that has lately become all too familiar. He told them the small company’s business, designing and manufacturing custom equipment for industrial plants, had been sliced nearly in half.

But rather than resorting to layoffs, Mr. Koppe asked half his employees to come in every other week. The government would make up roughly two-thirds of their lost wages out of a fund filled in good times through payroll deductions and company contributions. ”

It’s the safety net, folks.

A strong safety net prevents extreme hardship among the losers in an economic downturn while keeping a certain amount of money in even the most lean pockets, money guaranteed to be spent locally to support the most necessary businesses in the communities and providing an amount of stimulus in proportion to the amount of people losing their jobs.

Programs such as the one described above maintain the skills of the workforce. Workers affected by the downturn don’t fall behind and have none of the kinds of resume/CV gaps that make finding new jobs harder. No one loses access to the level of healthcare coverage they had before. What’s more is it costs considerably less than the American version of stimulus.

According to the story, when Obama goes to the G20 meeting, he plans to press the Europeans to take more actions parallel to those the US is taking, but maybe it would be a better idea to listen and learn from EU methods.

Read the article and tell me what you think.

Gee, somebody somewhere who matters must really think Geitner’s plan is going to work! Not only that home sales jumped the most they have in 6 years.

Who woulda thought?


For the stock market rebounding? I don’t hear near as many voices giving him the credit for the upward turn as were giving him credit for the downward trend since he took office.

I know it’s too early. But it was too early to blame him for the downward part, too, and that didn’t stop them, so I think the same folks who gave him credit for that should be shouting his praise to the skies.

I don’t expect any such thing to happen. What I expect is for them to go dead quiet until it starts to go downward again, whatever the reason.

I’d love to give Obama the credit. After all, I predicted that once it was clear that those trying to stop his stimulus program would fail, it would go up. It took a while longer than that. A few more positive actions.

Did anyone notice that it happened just after he tackled healthcare? Could that be significant?

I don’t have long to write tonight. Perhaps I’ll update and write more on this for tomorrow. For now, I told you so.

I’ve written on this blog about arts and the economy before. I might even have mentioned the fact that when artists move into a run-down neighborhood, property values balloon usually eventually pushing the artists out again. This is such a common phenomena that it is even included as a part of the Wikipedia entry on “Gentrification”

“The method by which an urban “artist colony” is transformed into an affluent neighborhood has been well documented for many years.  Artists and subcultural students (later nicknamed “hipsters“, but also including the hippies of earlier years) often seek out devaluated urban neighborhoods for their low prices, central location and for their sense of authenticity or “grit”.[38] As the bohemian character of the area grows, it appeals “not only to committed participants but also to sporadic consumers”;[39] eventually, those “sporadic” consumers edge out the earlier arrivals.”…”Sharon Zukin refers to a somewhat contradictory “Artistic Mode of Production” wherein patrician capitalists seek to increase the property values of (that is, gentrify) urban space through the recruitment and retention of artists; that is, by subtle or overt means of encouraging artists to occupy, say, former industrial facilities.[50] This has become public policy in some cities. In UK cities like Newcastle-upon-Tyne and Liverpool, the actions of regional development agencies, in tandem with private speculators, have attempted to artificially stimulate the process of gentrification. In Jackson, Michigan, the city council has approved the redevelopment of a long-closed 19th century state prison by approving the construction of low rent housing within its walls and making artists loft space available in adjacent abandoned industrial buildings. Property developers have noticed that taking a building they eventually wish to re-develop and offering it cheaply to artists for a few years can impart a ‘hip’ feel to the surrounding area.” 

I also may have written about seeing articles in the UK press about perfectly decent homes in Detroit suburbs being abandoned in the mortage crisis and going for bargain prices. The bargain price I had seen was $7500, if I remember right. And I have suggested in any number of comments on other blogs if not this one, that the solution when whole neighborhoods were endangered by foreclosures and dropping home values was to invite the artists in.

Maybe that house had its wiring and appliances intact, because now (on Treehugger) I have come upon a new article from the New York Times entitled:

The $100 House

Sure enough, while I’ve been thinking that a group of friends getting together and taking over one of those abandoned neighborhoods as an act of entrepreneurship, while I’ve been thinking that a group of artists would be just the kind of people to do that, it’s been done.

“A local couple, Mitch Cope and Gina Reichert, started the ball rolling. An artist and an architect, they recently became the proud owners of a one-bedroom house in East Detroit for just $1,900.”…”Almost immediately, Mitch and Gina bought two adjacent lots for even less and, with the help of friends and local youngsters, dug in a garden. Then they bought the house next door for $500, reselling it to a pair of local artists for a $50 profit. When they heard about the $100 place down the street, they called their friends Jon and Sarah.”…”A group of architects and city planners in Amsterdam started a project called the “Detroit Unreal Estate Agency” and, with Mitch’s help, found a property around the corner.”…”In a way, a strange, new American dream can be found here, amid the crumbling, semi-majestic ruins of a half-century’s industrial decline. The good news is that, almost magically, dreamers are already showing up. Mitch and Gina have already been approached by some Germans who want to build a giant two-story-tall beehive. Mitch thinks he knows just the spot for it.”

So if you want to be in the right place when this economic downturn finally lifts, my advice is:

Follow the artists.

Want to see the economy rebound? Who doesn’t, right?

How bad do you want to see the economy rebound? Think about it. Take your time. Enough to cease all efforts to keep a program you don’t like from working?

No? Then you can expect a continuation of the stock market falling, businesses closing, jobs being lost, houses being lost, and so on and so on and so on.

Because, face it, no one can truly have good faith that Obama’s program will work as long as there are so many people putting so much effort into seeing that it doesn’t get a chance to work.

Think some more. Suppose you succeed in obstructing it to the point that it doesn’t work. How will you benefit? Go ahead, tell me how?

Will you benefit by continued Wall Street losses? By your property’s value falling still further? By more businesses closing in the town you live in? By having greater numbers of homeless around?

By having more crime?

Because folks who do not have the money to provide themselves with food and shelter do not stop seeking food and shelter. They don’t just lie down and die. They do whatever is necessary to provide themselves with food and shelter and all the basic needs. After all, what would you not do to provide your child with these? How can you expect more self and family sacrifice of anyone else?

On the other hand, suppose you simply stop obstructing Obama’s program. Suppose you just step back, saying “I don’t approve of this plan. I don’t think it will work. But I’m going to give it every chance of working. I’m not going to just stop obstructing it. I’m going to do all I can to show that even with the full support of everyone in the US, including folks like me who have serious doubts, it can’t and won’t work! I’m going to give it two full years to show signs of success. I’m going to use those two years to come up with an alternative plan. And if or when Obama’s plan hasn’t worked in two years, I’m going to fight tooth and nail to see a new a very different plan implemented.”

What do you think would happen to the stock market, to house prices, to job losses, to all those problems we’re facing now?

I think the economy would take a major turn and start rising.

Go ahead. Stop obstructing and prove me wrong.

Djcnor’s Weblog

  • @KathrynGoldman Saw your blog post on famous people in fiction. Have character who is supposed to be dead, turns out not to be. OK? 1 year ago
  • I'm back! I haven't posted in a long time, but since Joanie Freeman and I won Charlottesville SOUP, I feel the need to return. 5 years ago
  • Haven't been here on my new iPad. Page looks totally different. Where is the option to reply? And where are the RT's? 6 years ago
  • @The_Puck Same to you. You denial is damaging to yourself and all you care about, assuming there must be some of those. 6 years ago