I often get the feeling my fellow citizens do not understand how much most nations comprising Western civilization, including the United States, have been decaying. They have shown they know something is greatly wrong with our societies. This is evidenced by populist rebellions during recent elections and referenda in the United States, Great Britain, France, and Italy, among others. Nevertheless, do the various electorates of the West realize the decay poses an existential threat?
One often mentioned explanation for plunging stock markets has been the specter of inflation raising its ugly, grisly head. With the American economy rousing from its slumbers, many expect rising demand for goods and services to motivate the Federal Reserve to raise interest rates.
The trading floor of the New York Stock Exchange (NYSE) in the age of the internet. Note all the computer monitors.
Wikimedia Commons / Ryan Lawler
In case you have not noticed, the American stock markets have been falling precipitously over the past two trading days. The action began last Friday when the Dow-Jones Industrial Index fell 666 points, or 2.5%. Then Monday, the Dow continued its descent by falling 1,175 points. At one point yesterday, its fall reached 1,597 points, but the market recovered part of this loss by its close. If the economy has been doing so much better over the past year, why is the stock market diving for the abyss? Is this a sign the economy is on the edge of collapse? What is going on?
The first estimate for fourth quarter 2017 U.S. GDP growth, released by the Bureau of Economic Analysis (PDF) on January 26, came in at a disappointingly low 2.6%. The first quarter, the last totally owned by the economic policies of the Obama administration, was at the typically low Obama-era level of 1.2%. The second and third quarters had growth of 3.1% and 3.2%, respectively. The average of just the last three quarters was 3.0%. For the entire year, the average growth rate was 2.3% year-over-year. It did not take long for some progressive pundits to claim this shows Trump’s economic policies will not give the growth he promised after all. Will economic conditions cause GDP growth to stall?
The Boston Tea Party on December 16, 1773. American colonists dressed as native Americans are making clear to the English their contempt for British dirigiste policies.
Wikimedia Commons / Nathaniel Currier (1846)
There are a very large number of reasons why we might expect a new paradigm for democratic government to arise, as I noted in my last post. The old ways of depending on government to solve social and economic problems are spawning even more problems with equal or greater malignity. How can we escape this dilemma?
All around us across the entire planet, human societies with diverse cultures are boiling over with chaos generated by an accumulation of unsolved problems. A very natural thought about all this chaos is that many very major structures both within and between nation states are imminently liable to decisively break. Are we facing social revolutions in the ways most humans view government? Continue Reading…
Recently a friend asked me, “What do you think life and economics will be like in 100 and 200 years, if no catastrophe derails the progress of civilization and technological development?” To this question about the American Future, I replied,
As you might expect from what I have written in the past, I think your premise about civilization avoiding catastrophe to be problematic. Nevertheless, if I accept your premise, I would have to say I have very little clue. However, whatever its shape, the economy should be largely independent of government management and control. The reason why I expect this is that this is the only way your premise could be true. Without a free-market economy, government-induced catastrophe would inevitably hit us. Witness the economic stagnation of most of Western Europe and the United States over the past several decades, the dissolution of the Soviet Union, modern day Venezuela, Cuba, North Korea, etc., etc.
Nevertheless, one can think of various possible trends for the American Future of differing plausibilities. Let us take a look at what I think are the more probable possibilities. Before we do that, however, let us think of the binding constraints reality puts on these thought experiments, and how we should go about conducting them.
Hauser’s Curve Image Credit: Wikimedia commons/Sugar-Baby-Love
American progressives want a much bigger government with greater powers, while neoliberals (usually mislabeled “conservatives”) passionately want a greatly smaller, weaker government. The reasons for the neoliberal resistance to progressive policies are that neoliberals believe those policies to be incompatible with both human freedom and general economic prosperity.
The interaction of Hauser’s Law with Rahn’s Law provides an important neoliberal argument for limiting both government taxes and government spending. However, Hauser’s Law is an economic “law” only by courtesy of the fact that it has always been observed to be true in the United States for the past seven decades or so. If it can be repealed, that economic change could expose a serious flaw in the neoliberal picture of economic reality.
A friend and critic of mine on the progressive side of the argument pointed out an explanation for Hauser’s Law that shows how it might be repealed. Let us take a careful look at it.
The labyrinth connections of persuasion
(c) Can Stock Photo / focalpoint
Despite the kernel of truth in this famous epigram, the long sweep of history teaches us it is fundamentally false. About a millennium ago, the timescale on which human world views (weltanshauungen, religions, ideologies) were fundamentally changed was measured in centuries. In our time, however, with increasing connections between human minds offered by the internet and televised news, and with accelerating advances in science, this timescale has shortened to decades. It would be extremely expedient and opportune for us now to find yet another revolution in Western world views. The modern challenges the Western world faces are truly existential in nature. Neoliberal and progressive minds will have to adjust if we are to survive.
Vice President Mike Pence, as President of the Senate, announces final passage of the Tax Cut and Jobs Act in the Senate, 51-48.
Screen shot of Right Side Broadcasting Network video on Youtube
The lies of progressive politicians, pundits, and progressive allied news media have seriously misled Americans about what the recently passed GOP tax reform bill actually does. Senate minority leader Sen. Chuck Schumer (D-NY) may have claimed Republicans “will rue the day” they passed the tax bill, but it is far more likely Democrats and their supporting news media echo chamber will rue the day they misrepresented and opposed tax reform. This might happen as soon as next February when American workers discover their new, lower payroll taxes. Continue Reading…
A 1795 view of political debates that could pass for today!
Wikimedia Commons / Issac Cruikshank (1756-1811)
This essay is a cri de coeur from yours truly about what I see as progressives’ unyielding idiocy about the nature of the world. I do appreciate that progressives would generally respond in similar fashion to people of my ilk, and that since the election of Donald Trump they have been giving ever greater vent to their own frustrations. Indeed, those of us who are neoliberals have been dumbfounded with amazement by progressives’ evident loss of sanity resulting from Trump’s election. Continue Reading…
While obtaining the daily solar activity statistics for my Solar Activity page this morning, I came across the intriguing plot above on the Spaceweather.com website. Why is it so intriguing? Its fascination derives from the additional damage it does to the theory of Anthropogenic (i.e. man-made) Global Warming, or AGW. Continue Reading…
Hauser’s Curve Image Credit: Wikimedia commons/Sugar-Baby-Love
With a Republican tax bill having passed both houses of Congress and certain to be signed by the President, taxes and tax rates are the universal subject of the day. A critical empirical fact to consider in the debate is Hauser’s Law, as illustrated by Hauser’s curve above. Continue Reading…
Two faces of American populism
Left: Sen. Bernie Sanders(I-VT) during campaign event in Phoenix, Az. Wikimedia Commons/Gage Skidmore
Right: Donald Trump during 2016 presidential campaign event. Wikimedia Commons/Gage Skidmore
American elites appear to remain both stunned and bewildered by the results of last year’s elections, even after more than a year later. It is unthinkable, as they see it, that so many people should reject the obvious truths the elites proclaim. These are the intelligentsia, and the nation’s leaders in academia, entertainment, news media, business, and politics. How can such a large number of American voters repudiate them?
Former CFPB director Richard Cordray testifying before a congressional committee.
Screenshot from a Youtube video produced by CNN Money
No sooner do I write a post about the dangers of government regulation and the regulatory state than one of the featured rogue agencies proves just how much of a rogue it is. Continue Reading…