George Rebane
Those getting their news from the lamestream regularly miss important aspects of recent developments. Three particular items come to mind that will first affect our economy, and then perhaps impact our slide toward socialism.
The Republicrats have repealed the requirement for a national debt ceiling, thereby allowing the Treasury to continue borrowing with impunity to fund all the programs that the central planners have assigned to a growing leviathan (here). For the Republicans it was a bell weather capitulation, baking in the notion that they are helpless to counter the truth that it takes both parties to ‘shut down government’ and/or ‘default on our nation’s debt and other Congressional commitments’. This genie will not be put back in the bottle. Perhaps Congress will give a lame try at again requiring it to approve all Treasury bond issuances. Nevertheless, the slide toward fiscal oblivion and its aftermath is starting to accelerate.
President Hollande made an audacious statement to the French people that reflects today’s desperate attempts in the EU to walk back from too much socialism (here). This hard left progressive was finally forced to cede a turn from Keynesianism and propose that supply side economics is in France’s future. "We need to produce more, and better," Mr. Hollande told his country last month, while announcing plans to cut payroll taxes and rein in public spending. He added: "Action is therefore needed on supply. Yes, supply! This is not contradictory with demand. Supply even creates demand." My, my, my. Our lamestream, of course, completely missed this one.
A new redistributionist social contract is needed according to Dr William Galston of the progressive Brookings Institute. Economists are now beginning to recognize the ‘Great Decoupling’ of wages from productivity that is caused by accelerating technology – a concept long familiar to RR readers. Capital and labor used to fly in more or less tight formation – as productivity increased, so did wages because it was then the increased skill level of workers operating the new machinery that gave rise to increased productivity. This is no longer true, and becoming less so as capital invests in new machines that are autonomous of the increasingly unskilled, uneducated, and redundant workforce. This effect is two-edged since it has also brought about the QoL increases we all enjoy. And Galston agrees with RR that continuing the same ol’ same ol’ policies of the Republicrats is not going to keep blood out of the gutters.
Galston’s punchline is that “the facts push me to a more radical conclusion: We cannot expect robust, sustainable economic growth unless we can figure out how average households can participate in the fruits of that growth, as they did in the postwar period. We need nothing less than a new norm—a revised social contract—that links compensation to productivity. And because we cannot return to the conditions that once sustained that link, we need new policies to bring it about. Neither political party has come close to proposing anything of the sort, and the American people know it.”
But the rub is that the Left’s past solutions linking compensation to productivity have quashed productivity in the way they have compensated workers decoupled from punished productivity. And he has yet to reveal what the government's "new policies" will be that impose this new “radical” and “revised social contract”. We tremble in anticipation. (more here)
[Addendum] I can’t close without informing readers about the latest from Reporters Without Borders who regularly publish the World Press Freedom Index. While progressives continue their denial of the co-opted lamestream, the rankings data show that during 2013 the US has precipitously slipped 13 more steps in the WPFI, and now ranks 46th in the world (here). This attests to the claim made here that American journalism in the large has pretty much become an unprincipled bought-and-paid-for profession of lackeys that deserves its place in the barrel with similarly motivated barristers and politicians. Again, the lamestream has sent its best team of crickets to cover this important news for our increasingly uninformed public.
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