Last month, a new wave of Congressional members made their way to Washington with much fanfare, promising a centrally directed democratic economy that would herald a time of prosperity for everyone. Yet, rather than focusing on future hopes and possibilities, the new Congress seems preoccupied with the failures and disappointments of the past.
The mantra of Karl Marx from 1875—“From each according to his ability, to each according to his needs”—takes on a new form for this Congress: “No shirker left behind.”
To achieve this goal, it seems they believe they can simply negate the fundamental laws of economics and arithmetic through legislation. Eager compliance from House Democrats and many Republicans suggests they might just be willing to do so. After all, voters often overlook the implications of debts and deficits.
Politicians know that to win elections and maintain their positions, they must promise free services and benefits. A candidate who suggests cuts to Social Security or limitations on Medicare is unlikely to last long in office. Continue reading
There’s a disconcerting trend developing within the framework of political economy…
The public seems to be grappling with a multitude of self-inflicted economic and social woes, creating a sense of urgency and anxiety. They’re frustrated with the uneven mix of hardship and turmoil but remain unsure of how to remedy the situation.
On the surface, many see the central issue as the disparity between incomes and expenses, compounded by rising debt obligations. Recent reports indicate that a record seven million Americans are now at least 90 days overdue on their car payments.
Clearly, income levels aren’t sufficient to meet financial demands. But what lies behind this deficiency? Why has the overall value of labor fallen so far short of the cost of goods and services? What truly underpins the significant economic strain faced by everyday workers?
A deeper investigation reveals some extraordinary truths that few are willing to confront. Of those who do, only a rare breed seems inclined to engage with these unsettling realities. Continue reading
Another week brings yet another series of distractions. For instance, Tuesday featured the grand State of the Union Address, which has spurred numerous opinions and observations. Here are some of our thoughts…
President Trump, a charismatic showman, must have eagerly anticipated the lead-up to his Tuesday night address. It likely came as a letdown to face a room full of what many would consider the most unscrupulous politicians in history during his speech.
But the show goes on, in spite of its disappointments. Life is fraught with letdowns—missed opportunities, tedious hours spent chasing unattainable roles, and even mundane events like Super Bowl Sunday can leave us feeling unfulfilled. Disappointments, duds, and unfulfilled expectations seem to accumulate endlessly.
Words are often at the heart of these disappointments—uttered when they shouldn’t be, and left unsaid when they should be. Continue reading
We’re witnessing issues such as currency devaluation, inflated asset prices, and a series of financial booms, bubbles, and busts. Indeed, central bankers have managed to greatly distort the global economy, including the Federal Reserve.
Recent financial crises, such as the mortgage meltdown, synchronously aligned with the Fed’s interest rate increases. Rates were lowered following the dot-com bust, leading to the inflation of a substantial housing bubble. When the Fed attempted to control this bubble by raising rates, the bubble ultimately burst.
Similarly, the dot-com collapse also coincided with rate hikes. Rates were lowered to rescue financial markets from the Long-Term Capital Management crisis and to prevent contagion from the 1997 Asian financial crisis. This cheap credit fostered unrealistic beliefs about wealth generation through the internet. Yet, when the Fed raised rates to bring a sense of reality back to the stock market, the results were catastrophic. Continue reading
