I am sorry but that is simply insane. Please see Hardball In Vallejo for a discussion of this topic.

Waning U.S. Influence in a World Economy

The U.S. went from being the largest creditor nation to the world’s largest debtor. It's spending itself into oblivion, and at the same time rising economies in China, India, Brazil, and other emerging markets means the U.S. can no longer call all the shots.

Most importantly, a rising world economy means the U.S. has to compete for resources, especially energy, which is something it's not had to do before.

In regards to education, having a degree is no longer a guarantee of getting a high paying job. The rest of the world is catching up or even passing up the U.S. in education while we argue over school prayer and creationism. The latter makes us the laughingstock of the scientific world. Education, while important, ignores the fact that China, India and other places are turning out more doctors, engineers, etc than we are. On the other hand, we are turning out more lawyers than anyone else. Is this a good tradeoff?

For the first time in history, the standard of living in the U.S. is about to fall. It has to fall because we have lived beyond our means for too many years.

The Big Lie?

Let's now take another look at MC's statement of "I was born into a country that emphasized hard work, loyalty, stability, and 'if you get educated and skilled, work hard, work smart, and behave yourself, you will do all right.' I no longer believe that lie."

For the U.S. to remain competitive wages must come down and spending must come down. Like it or not, those are simply the facts. If that doesn't happen, we're going to see more bankruptcies at the personal, corporate, city, and perhaps even state level. California itself is a prime bankruptcy candidate in my opinion. But less services means fewer jobs or lower wages. Otherwise taxes have to rise or the U.S. dollar will continue to sink.

We are in this mess because we tried to spend our way to prosperity. In addition, too many people have houses, SUVs, boats and other toys they cannot afford, all egged on by "the ownership society" and other misguided policies.

Living Wage

One repeatedly hears the phrase "we need a living wage." One problem with "living wages" is that regardless of what anyone is making, there has been willingness for nearly everyone to spend every penny and then some. Part of this is no doubt related to policies at the Federal Reserve that encourage both consumption and speculation.

Another problem is people seem to believe they need things they clearly don't: SUVs, for example. I grew up in a family of six. We did not have an SUV (they did not even exist then). Nor did we have a large house. I think the square footage of our house was something like 700 square feet, if that. It had one bathroom. At the time, I thought it was perfectly normal.

Now it seems that not having a SUV (or two), huge TVs, cell phones for everyone in the family and a large McMansion to live in is an act of deprivation.

Courage To Choose

Let's now consider a timeless post by Minyan Peter. It's called The Courage To Choose.

I believe that in time, historians will define the last twenty years in America as the “Age of Aspiration” where, thanks to unprecedented levels of credit, Americans could become anything they wanted. Where, thanks to 0% down debt and a seemingly robust economy, we could own bigger homes, fancier cars, and more lavish vacations – where our bounty was limited only by the boldness of our wants.

Well, I, for one, believe that our Age of Aspiration is ending. And, with its conclusion, we must, for the first time in almost a generation, begin to reconcile our wants with our means. We must choose what to do without, rather than what more to do with.

But I would suggest that few of us are prepared for this challenge. Why? Because abundance relieves each of us from having to prioritize what is important. When anything is possible, everything is possible. Few of us have really had to choose.

As I look ahead to 2008, though, I believe that each of us, the communities we live in, and the organizations and companies we serve, are going to have to make choices. We are going to have to separate what is most important from least, and act accordingly. Where life was once limitless, it will now be constrained. And, like it or not, all of us will need to return to our vocabulary a simple phrase that I believe has been lost over the past 20 years: “I can’t afford that.”

So as we approach 2008, I wish the Minyanville community the wisdom to prioritize well, the courage to make the hard, and often painful, choices, and, most of all, the strength and conviction to follow through.

The Right Choice

Given that it's impossible to stop the forces of globalization, impossible to roll back the hands of time, and impossible to halt the waning influence of the U.S. in a world economy, we need leaders now more than ever to choose wisely on policy decisions, to stop spending money we do not have, and to stop the debasement of the U.S. dollar.

My choice was Ron Paul. My choice is not going to win. My second choice is anyone who will get us out of Iraq and stop squandering trillions on a war against a faceless enemy. I believe that is the single best choice we can make about anything. But that's my choice, it may not be yours.

Those who are in favor of this war at least ought to have the courage to fund it. That means higher taxes. Presented in that fashion: higher taxes and stay in Iraq vs. lower taxes and leave, I think 85% of the population would vote to leave.

Instead, it's my opinion that there's the "free lunch" policy in Congress and by this administration that allows us to keep spending money we do not have being the world’s policeman, that subsidizes ethanol producers, subsidizes housing, and funds all sorts of other programs that have no business being funded. The waste in our medical programs is a particular outrage.

Someone is benefiting from this madness but it sure is not the consumer.

The rest of the world is financing those excesses and it is showing up in a dollar that continues to slide. The few (those being subsidized) benefit at the expense of everyone else even as the economic distortions ripple through the rest of the economy. To stop the madness, it's time to have the courage to opt for a balanced budget and it's time to have the courage to abolish the Fed.

I believe the final analysis will show that it's not subsistence wages that are killing the country, rather, it's poor policy decisions at the personal, corporate, municipal, and Federal level that are killing the economy.

Returning one more time to a point I made earlier "It's not how much one makes that is important, it's how far what one makes goes." That is indeed something Congress and the next administration can address, if only they have the courage to do so. 

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