The Rabid Independent, Nonpartisan solutions, independent policy ideas

Greece went to the mall and loaded up on imported cars (German), imported clothes (Chinese), imported wine (France) , then they renovated all their houses. They used a credit card they were given by the EEC. Every time they exceeded their limit, it was raised … until?

Greece got an extension this week but the problem was just kicked down the road – again. Greek desperation (exasperation)  is a metaphor for the fear and depression that has settled throughout Europe. The single currency system is a failure. Without a credit policeman it could never work and the benefits of easing currency barriers look completely anachronistic given technology like Apple Pay. Who wants free and open borders in a world of roving ISIS cells? The regulated, insulated, antiquated European model has been crushed by (currency) policy inflexibility. Outside of Germany, no one really needs a European worker – not even the Europeans.

Incredibly the people seem to have adjusted. No matter how high the unemployment rate rises, no one complains. Outside of Greece we don’t have a single angry Prime Minister making radical proposals. Where’s the fire? The complacency has led to such severe belt tightening that Europe has become a creditor! They have surplus money to lend even though they don’t even make the clothes on their backs. Apparently living in your parents basement (at 30) doesn’t require much of an allowance.

While the common man in Europe has adjusted to a new asceticism, his American counterpart still borrows in the belief that things will get better – soon. Interns get jobs in New York City in the hope that someday they will cover the rent without mom and dad’s help. Law schools get ever more applicants even though we have proof that it leads only to indebtedness and unemployment. In the tri-state area (around New York) baby sitters get paid more than college graduates (and it’s in cash!)

We are all partly Greek – it’s just that the debt collector arrived at their door first. Yes they borrowed in a foreign currency so  we are  better off than they will be but pulling out of the death spiral where we borrow to buy stuff made elsewhere will be very hard.  Let’s take a test to see if you are prepared for the inevitable belt tightening.. You pass if none of the following are true:

  • You are still living in the same house you had when your children were growing up but they are gone and the real estate taxes are greater than $25,000 per year.
  • One or more of your children are studying at expensive private universities – paid for by chunky student loans.
  • One or more of your children are at a non-Ivy league law school.
  • You are subsidizing one or more of your children who have taken jobs far away that will never cover their overhead.
  • You have saved less than $2 million and actually believe that social security, your children or the lottery will cover your retirement.

You get extra marks if:

  • Your household contains multiple generations and multiple wage earners (and you’re OK sharing space with your children’s families).
  • Your health is fabulous (since Medicare will get worse and probably go broke by 2020).
  • You live in a low tax state especially where the climate is temperate, because your fixed income(s) won’t cover the higher taxes (and utility costs) that most broke (Northeastern) states ( and California) levy.
  • You prefer to live in small, really small space.
  • You have no debt of any kind.
  • You’ve always dreamed of making coffee at Starbucks.

American optimism needs some adjustment. We stopped being exceptional the moment we abandoned American labor in favor of third world peasants and cheap flat screens. Greece is showing us what it’s like when there are no options left. Their only hope for economic rejuvenation is currency devaluation, deregulation and complete government transparency.

We are not so different.

 

The Beyonce Economy

On February 12, 2015 By

As labor becomes free (along with information), our most productive skilled laborers and capital owners are rendered freer to perform their craft. Let’s take a look at Beyonce.

Given our willingness to allow in an unlimited number of illegal aliens she can now hire a bevy of dirt cheap personal assistants to take care of […]

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What would Keynes do?

On February 5, 2015 By

President Obama released a new budget plan last week that raises taxes on the wealthy to pay for infrastructure. It does nothing to reduce the current budget deficit In fact he predicted it would rise by 20% next year). The President continuously believes that one more magical fiscal push will get us over the hill. He also thinks […]

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OK – even I am amazed at how many Republican politicians want to run in the upcoming primaries. There is no modesty here, no perspective and a complete willingness to waste the public’s (and their own) time. Does Scott Walker really not see that no one will be able to tell the difference between his […]

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When you import 1.25 billion (peasant) laborers who buy (almost) nothing, then you will get a vast oversupply of goods and (by definition) labor. Prices for both will fall. Interest rates will then fall and for a while the stock market will be happy since costs fall faster than store prices.

With all the fracking we do, […]

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Military Insecurity

On January 13, 2015 By

Military secrecy is not a new thing – as the saying goes: the first casualty of war is the truth. Military insecurity (in modern America) however, is brand new. The willingness of the US government to fire and indict any defense worker for even speaking to the press is stunning. We never saw this level of secrecy under such paranoid schemers […]

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Everyone seems to ask repeatedly: How can the stock market set new records when there is all this global turmoil? Are investors not watching the mess in the Middle East, the bankruptcy of Russia, the instability in Brazil and Argentina, Euro-sclerosis, narco/government crime in Mexico, and Ebola?  Perhaps it’s all Fed created liquidity that just fuels […]

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Is liberalism under pressure?

On December 19, 2014 By

The WSJ had an op-ed article describing public fatigue with the liberal fights against campus rape, Wall Street, and police brutality. The assertion is that complaining and protesting is passe even when it appropriately attacks genuinely bad behavior. If anything the level of public apathy has been a shocking new development given the level of economic […]

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I have written about how even in the American south during the 19th century, cotton farmers used to dream about the boon to their businesses if they could just get every person in China to buy 1 cotton shirt. Needless to say that never happened but the dream never dies. After all there are so […]

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Russia vs China

On December 2, 2014 By

OK – everyone is picking on Mr. Putin. He’s an easy target since he seems a little vain. It’s hard to be scared of a dictator whose country is crumbling (economically). So what are his crimes?:

He kind of just took over (back) Crimea without asking us. He hates the free press and shuts down […]

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Irritations

Here’s my list of things that bug me. Some are big and some are petty. Feel free to offer new additions.

Irritations

Mottos, Creeds, Rules

As we search for legitimate solutions to America’s problems everyone must obey these rules or we’ll never get anything done.

Mottos, Creeds and Rules

Reading List