January 25, 2009

New in VDARE.com: How to boost the economy

From my VDARE.com column:

From 2001 onward, there was no real economic growth in America, just pseudo-growth ginned up by home equity withdrawals. Our trade balance, for example, averaged over 5 percent of GDP throughout Bush’s second term.

So, the real question is not how do we stimulate consumption once again to unsustainable heights, but: How do we become more productive? How do we make more stuff that people want to buy? How do we get better at creating more wealth?

The nation turns its eyes to Barack Obama, whose single year of working for a for-profit corporation made him feel like a spy behind enemy lines (as I point out in my book America’s Half-Blood Prince: Barack Obama’s “Story of Race and Inheritance.” ) Obama has no experience in creating wealth, just in extracting it from others to spend for his political advancement.

But, needless to say, the Republicans have no clue what alternatives to offer.

The triumph of the globalist ideology means that the globalists’ vaunted playbook is exhausted.

Free trade? Tariffs have already been cut almost to nothing—to 1.3 percent on average!

Cheaper labor? The globalist recipe—outsourcing and insourcing once well-paid jobs away from American citizens—has been followed for decades. The plan was to drive wages down but keep consumption up by offering Americans lots and lots of debt. How’s that working out lately?

My published articles are archived at iSteve.com -- Steve Sailer

27 comments:

Anonymous said...

This is a good suggestion, Steve, but I don't see it happening...at least not any time soon.

Liberals, on this issue, seem to get to "have their cake and eat it too." For instance, Republicans rarely talk about affirmative action anymore. In many ways, the Repubs have become liberals on the issue of affirmative action, and that makes supporting affirmative action easy for liberals since virtually no one challenges them on it.

The best solution would be to attack affirmative action on a state by state basis with ballot proposals like the ones proposed by Ward Connerly, and use your line of reasoning to combat the detractors by saying: "Barack Obama proves that if you work hard, are smart and are dedicated, you can do anything regardless of your race. Therefore, the need for affirmative action has passed since there no longer exists institutional racism in America."

The problem is, of course, there aren't enough "Ward Connerly's" pushing these type of ballot proposals.

Anonymous said...

It's amazing that the economy even stayed flat. During that time, oil quadrupled in price, the worker-to-retiree ratio fell and we spent a lot of money on security and war that had little short-term productivity effect.

The expensive technological leaps in imaging, metallurgy, robotics and trauma care over the last several years haven't paid off to the macroeconomy...yet. 67 as the Social Security age for current workers holds on...for now.

Anonymous said...

Globalism comes from the USA. So its fitting that eh US gets hurt the most by its downsides.

Next to the office where I work they are constructing a new building. The office is full of engineers but everybody goes looking regularly. Because it is amazing to see 10-20 people construct a large office block. Everything is either automated or being done using large machines. And things are well coordinated so that large machines work in tandem with workers walking in-between. The result is high productivity. But this not achieved through AA, set-asides, ethnic lobbying, feminism and politics. It was achieved because those boring white mechanical engineers at Putzmeister developed a huge crane which can place concrete at a specific location. This machine is operated by 1 person. The concrete is poured by 2. The volume per pour is only limited by the heat development and with cooling can be endless. Most machines are remote-controlled. The cranes are huge and come in and out with only one operator per machine. The guys doing the rebar are a handful and fast. And they know exactly what they are doing. Obviously there is no point in using construction to get people off the dole if the level of competence and training in simple things like construction are so high already. In a country like South Africa the workforce would have been at least 4 times that. And slower, with lower quality workmanship. I cannot speak for the US.

Raising productivity requires years of creative thinking and hard work. And thorough training. All things which are undermined by racially divisive politics aimed at replacing host populations. But this is exactly the type of politics which western liberals have been pursuing for 30 years. And they got themselves fat paycheques off the taxpayer who had to work hard and be creative in spite of all the problems being created by these liberal leeches.

Oh I forgot, I'm living in Germany.

Anonymous said...

You've got to be joking Steve.

Obama's advisor Reich was quoted (and shown on Fox News in video, also Lou Dobbs on CNN) that the bailout and stimulus MUST exclude White Men, and especially skilled White Men and White Male construction workers. Instead focusing on the long term unemployed, Blacks, Hispanics, and Women.

Conyers, Pelosi, and Rangel all agreed, heartily.

Reich even put it up on his blog.

This is the policy. Heck, Obama is now allowing all fifty states to set their OWN mileage and emissions standards. That's fifty different standards. It will add a minimum of $5,000 per car sold in California as Banks just burdened with toxic debt that cannot be valued or sold off are now demanding 95 to 150% of collateral for all loans.

Please.

Obama does not think the crisis is serious, thinks it will be solved by more diversity, and has told Whites to get to the back of the Bus.

Hopefully Boehner or some other Republican will seize the opportunity and quote Reich and Pelosi and Rangel and Conyers extensively, and argue that Dems view Government as taking money from White Men to give to non-White men. To exclude White Men.

Pure identity politics.

Nothing will happen. Not for a while. But as lots and lots and lots of White men are jobless and desperate, and all the money goes to anyone BUT them, it's a powerful argument.

White women of course are allied against White men, but there is nothing that can be done about that. [White women simply despise most White Men because they won't keep their icky awful desires to themselves and won't be nice gay type guys, instead mess up their approaches to the few dominant Alpha men.]

Anonymous said...

Another truly excellent column, Steve.

Evil Neocon's bitchy anti-SWPL rant on the previous thread reminded me of this little corner of the ascendant matriarchy:

http://www.ashleymadison.com/

This is a "discreet dating service" whose blatantly amoral sales pitch is: LIFE IS SHORT. HAVE AN AFFAIR.

Check out the pic on the front door showing the married woman going down on her stud.

There are social behaviors that go along with conspicious consumption and easy credit, both of which are the hallmarks of the front end of an inflationary period i.e. the "gilded age" we just passed through. But the corrective back side of an inflationary period, as the social mood darkens, is another story altogether.

Monetary inflation has a definite moral component that is rarely discussed. Probably because the people interested in morals don't talk much about money, and vice versa.

The point is we began a serious inflationary period around the turn of the century (gold was much cheaper in 2000) and now we have begun the corrective phase. So 2008 was probably near the high point for 'loose morals' to go along with the excess liquidity (in a period of deflation spouses will cling to each other much tighter).

This is not to say that the price of gold will fall in 2009. This particular deflation is threatening the entire system enough to cause a flight to gold.

And, even if the government radically reflates the economy from here, we will reap only the nasty effects of hyper-inflation, not the euphoric perceived wealth effect present in the early part of the cycle. And therefore social mood will only get darker.

So I am going to opine that there is no way to "boost the economy" from here. Sorry, Steve. We are in a necessary corrective phase that will last years because of the previous gigantic inflationary credit bubble. But this financial correction will trigger certain behavioral changes that strengthen the social fabric (increased frugality and increased monogamy).

Anonymous said...

Oh, I see Evil Neocon left a bitchy rant on this thread also. My mistake.

Evil, you sound like a 5 who is chasing after 8's, 9's and 10's. The pickup artist community is full of your angry, passive-aggressive type.

Anonymous said...

"[White women simply despise most White Men because they won't keep their icky awful desires to themselves and won't be nice gay type guys, instead mess up their approaches to the few dominant Alpha men.]"

Yeah, so instead they go for those civil, articulate, caring gangsta's from the hood and mestizo's from Mexico.

Anonymous said...

From what Headache said...

I was in a hotel in Finland not too long ago. Out of the window we watched construction guys working on a new office block opposite. Two on the building securing girders plus one in the crane. Under floodlights as it was dark (afternoon but this was winter) the temperature was below freezing and there was light snow.

I was impressed. No room for the untrained or unskilled there.

Anonymous said...

I think the Calculated Risk re-computation of GDP without Mortgage Equity Withdrawals means something slightly different from your interpretation of no GDP growth. The consumption and production financed by MEWs was real, and thus a part of real GDP growth. But it was financed under the delusion that wealth (future income) was higher than it actually was. So this slice of GDP should have been going into additional savings and investment in order to preserve desired future-income levels. In other words, the economy grew from 2000 to 2007, but it grew stupidly.

You might enjoy the University of Chicago symposium video linked to on Greg Mankiw's website, which discusses the Obama stimulus. There is a Fat Irish Economist in a Baseball Cap (FIEinBC), Kevin Murphy, who says he never understood macroeconomics anyway. But he has developed a 4-variable model for assessing the costs and benefits of stimulus.

Neither the FIEinBC nor other Chicago panelists predict how long the financial system will remain malfunctional. Depending on your answer to that, you might be for no, some or a lot of fiscal stimulus. But the FIEinBC's 4-variable model actually works pretty well for other questions. And it converts these questions to your terms, real growth and what affects real growth.

Anonymous said...

I must say it's a bummer with O’s stimulus that white engineer's are supposed to wait outside.

I remember in the run-up to the 1994 election in South Africa there was much discussion amongst whites which country is preferable to immigrate to. Many thought the US was good because it was culturally similar to South Africa, only that the blacks were in the minority. I was suspicious of that country because having witnessed the ruthlessness with which blacks pursued power in Africa, to me the US was just living on borrowed time. Back then my argument looked like it was motivated by racism, and even though I agree that I have a certain amount of prejudice, it was mostly based on extrapolating the realities we experienced in South Africa.

Nowadays I'm glad I immigrated to Europe. Sure, they have the Muslim issue here, but now the US has a black prez and white engineers are holding their hats. It’s so reminiscent of post-Apartheid South Africa, so the guys that went to the US only got 15 years mileage out of that country. That's not enough for a lifetime or ones' kids, and with an engineer's generally paltry pay, not enough to make a bounty and head off to Switzerland either. So this meltdown, O's election and the rules of the stimulus got me thinking about how we came to decisions back then.

Burke said...

Of course, it isn't just race. The Americans with Disabilities Act used the anti-discrimination regime to create a whole new class of beneficiaries, not just in hiring but in the provision of services.

Thanks, Bush 41!

Anonymous said...

The assumption here is that the Messiah actually wants to boost the economy. Nope. You already know what the real goal is: giving "huge sums of other people’s money to the politically well-positioned". Forget hard work, intelligence, talent, and energy. That's the Old America! The only thing that counts in the New America is political connections. You have 'em, wealth is given to you, you don't have 'em, wealth is taken from you.

Average Joe said...

"Racial quotas might be necessary for some institutions, typically local monopolies such as utilities or police forces, that aren’t disciplined by the market to maximize efficiency."

Do you really believe that it would be a good idea to have more black and Hispanic police officers and fewer white ones? Don't you think that having police officers with IQ's that are at least 100 is preferable?

Anonymous said...

Well, whatever is done, I say we can always rely on the old fall back option, More Immigration. Why not? We know that nothing bad ever comes out of immigration, only ever good. So if there's only upside to it, I say upside was never more needed than today. Full steam ahead. Five, ten million immigrants per year. That's sure to save the country.

(If only they'd known this in the 30s! Doh, some things are just so obvious you fail to see 'em!)

Anonymous said...

>>there’s no mention of beefing up or speeding up one massive infrastructure project already underway: the lagging border fence.

I don't understand why this is. Why don't politicians in the border states scream for federal dollars for a fence? Even if they didn't believe in it, it would mean more money and more jobs for their states.

Ted Stevens knew how to get federal dollars for Alaskan bridges, and Massachusetts pols got their share for the Big Dig. Why are politicians in the Southwest such pikers?

Anonymous said...

How do we become more productive? How do we make more stuff that people want to buy? How do we get better at creating more wealth?

There's nothing magical here. We're as capable of making stuff that people want to buy as the next nation. (Though we may have already reached the point of losing that capability, since offshoring everything high and low, importing a huge serf class, and actively disincentivizing the entry of native born young into tech fields, will inevitably result in the erosion of a nation's engineering mojo.) The simple fact is, that under our current government by corporate lobbyists, little can be invented or developed here whose production won't be offshored quick-as-be-damned.

Germany and Japan, for example, whatever the undoubted fine qualities of their engineers, their educational systems, and
their businessmen, do not maintain large trade surpluses because of these or some inherent comparative advantage, but because their governments put it place trade and industrial policies that allow them to do so. It's not that their workers aren't being squeezed by offshoring and other facts of globalization, or that they haven't ceded any vital capacities that may prove deleterious to their own national security, but they don't seem to have descended into the slavering economic insanity evinced by the leaders of the U.S. (or the UK) in recent years. (Though, hey, for all I know they may just be a bit behind-hand in the development of the "fuck off and die" attitude toward their own citizen workers that we've grown to know and love.)

The usual gangs of far-sighted patriots have already been spotted around the stimulus trough in Washington, after all, explaining how our economy is going to collapse if the stimulus isn't invested in increasing their own profits by pushing the trade deficit to even greater heights, and the absolutely vital importance of making sure that all stimulus-related employment is funneled to non-citizens. And Congress will buy all of it, and the Obama clowns will carry on the same tired policies as the Bush clowns, and economists fat and lean, Irish and non-Irish, will continue to pull at their chins and develop
this and that many variable models about the effects of stimuli, and we'll go right on sliding into the Third World.

So, yeah, I guess I don't have any constructive suggestions about boosting the economy. Have had some thoughts about sharpening the tines on the ol' ptichfork, though.

rainy_day said...

to testing99, re: Robert Reich's supposed 'exclude white men' statement -

he does not say that on his blog, he repudiates it. Although, reading what he did say elsewhere I can see how people could take it the way they did.

Jr Deputy Accountant said...

America is in for a rude awakening when our blisteringly intolerant view of other nations suddenly becomes us begging them for help.

I can tell you how to solve this crisis in three easy steps:
1. Re-evaluate the tax system from the ground up; if Americans are subject to a (questionably unconstitutional) personal income tax, the least the govt can do is let us know where it is going
2. Stop believing that Barack Obama is some kind of spiritual body as opposed to human being
3. Restore sound money to America by releasing the death grip of the Fed; the entity which causes, funds, perpetuates, and exacerbates crisis as a matter of policy.

End of story.

Race is yet another pathetic distraction from the true issue.

Anonymous said...

Race is yet another pathetic distraction from the true issue.

No, race is the only issue of any importance at this point in time.

When excessive diversity eventually turns the United States into a third world country, will you still be whining about taxes and the Fed?

Anonymous said...

the economy grew during the gw bush years. it just did not grow in a good way. GDP measures volume of activity. when two mexicans sell tacos on the street, GDP goes up. GDP does not distinguish between different kinds of economic activity. it is a simple, rough estimate of all economic activity. adding people generally adds economic activity, and for an industrialized nation, the US sure is good at adding people.

eliminating affirmative action will certainly make the US national economy more efficient. but it won't have the "saving the economy" effect people are looking for, because affirmative action is not (not yet anyway) one of the biggest problems with the US economy.

it is important to distinguish between what is actually happening on the ground, versus what the stock market is saying. the stock market is not connected to reality, and the price of stocks can increase while the fundamentals on the ground decline. reducing US operations for chinese or indian operations can certainly improve a company's bottom line, but this does not also improve the US economy. this is pretty much all that happened during the gw bush era. plenty of big business outfits destroyed their american operations in favor of reducing costs. actual, on the ground gains for the US national economy where nowhere near what the stock market was reporting.

for instance, i started to notice that GM was in dire trouble all the way back in 2004. even by 2008, the US news media was still completely missing on this story. they did not pick it up until the bailouts began.

in this decade, "the cheap oil big SUV" decade, people generally thought GM was doing well, but in reality, GM depended completely on record SUV sales just to stay alive. GM market share declined at a steady rate year after year, and it was already living paycheck to paycheck by 2005. GM required a huge amount of money to come in every month simply to keep it's vast business machine running, hence all the losses it was willing to incur by giving buyers zero percent loans and huge rebates. anything, ANYTHING to get the cash to keep coming in.

it was 2006 when the domestic car machine collapsed. US sales had finally declined enough that even with high SUV sales, total US sales were not enough to keep GM alive, and GM avoided bankruptcy only due to EU sales.

as soon as SUV and truck sales declined in america under the pressure of $100 oil, GM was fighting for it's life. by 2009 it would certainly have gone bankrupt without the bailout. it will probably go bankrupt anyway, unless more bailout dollars come along.

GM will never pay back those loans, because it is now permanently defeated in the international car market by japan and south korea. soon, china will begin exporting cars, and by 2020, the leading chinese car company will also be ahead of GM, if GM is still around.

US car exports to china are irrelevant. china made sure of that years ago. GM and ford can only sell cars in china under chinese terms: we own 50% of your factories and 100% of your technology. GM and ford wanted access to the chinese market, so they agreed to these ridiculous terms.

GM and ford exports to china do not even exist, cannot exist, and have not existed for a long time. all GM and ford vehicles sold in china are made in china, in factories 50% owned by china, by a 99% chinese workforce. chinese engineers are free to study and copy 100% of the technology GM and ford use, as per legal agreement.

Anonymous said...

This whole thing about the economy is stupid. By thinking about ways to fix it we are being drawn into more of the same. The fundamentals underlying western civ are wrong. Most modern western nations are built on the notion of positive economic growth as a substitute for a national culture and purpose. Multiculturalism requires constant economic growth as replacement for a viable national theme. It is anti-nationalist. Since most people on an intuitive level do not really believe in multiculturalism, and it does not have anything substantive to offer, it basically buys people off with the promise of economic growth aka wealth "real soon now" (iSteve TM). That's why multicultists freak out anytime the economy tanks or nationalism rears its head. They know they cannot really compete with nationalism so they try and smother it in its infancy. That explains their current hatred towards Russia. Of course there is one glaring exception but I aint gonna delve into that.

So we need new cars, washing machines, toasters, computers etc. even though the old stuff is mostly still intact and we could end up using it for decades. But the machine has to turn and money needs to increase. At least people should feel wealthier on paper so they can feel good about themselves and welcome their new friends from Mexico, Somalia and Haiti. Because it does not work so well it gets primed with borrowed money, hence the bubbles and hence the debt. Even if we get through this recession its obvious the underlying mechanism will not work forever. So we really should begin discussion about what will replace it.

Anonymous said...

Junior - Race is yet another pathetic distraction from the true issue.

This is a 'conservative' idea. All we need to do is get to the fundamentals of sound business, small govt, Reagan, Thatcher etc etc.

Generally that's something most Republicans would go along with and some Dems too. In some years more people vote Rep than Dem, though you will note we still dont get back to those fundamentals. In other years more people vote Dem, we definitely dont go back to those fundamentals.

In the swings between the parties one might detect the shifting support for these fundamental values. problem is this shift is really only amongst whites. They are the only group who will vote majority Republican and then not much over 50%.

Steve has often pointed out the fallacy of the hispanic Republican vote but that vote isnt the only non-white one. Blacks, Jews, Asians, native Americans all vote Democratic every year. Year in year out.

In a good year for the GOP non-whites only vote Democrat. In a bad year for the GOP, they vote very Democrat.

As far as I can see in Presidential votes going back to at least '72. This has always happened. So to transcend race and get on with the real business you've got to persuade more whites to go along with it when even now Republican victories don't translate into conservative policies. And almost certainly impossible this; overturn at least a generation or two of hard wired political instincts amongst all other groups.

And remember you are on a time limit. At some point non-white voters will outnumber whites to the point that the GOP will never win again at the national level.

A few years down the line you will still be saying race is a distraction and the real world will be reminding you it isnt.

So like many race-blind conservatives you need to wake up.

Anonymous said...

So we need new cars, washing machines, toasters, computers etc. even though the old stuff is mostly still intact and we could end up using it for decades.

Yeah, I know that the only reason I'm not still using my old 386SX from ninety-whatnot is 'cause of conspicuous consumption....

And the new toaster really impresses the babes....

Anonymous said...

"This whole thing about the economy is stupid. By thinking about ways to fix it we are being drawn into more of the same. The fundamentals underlying western civ are wrong. Most modern western nations are built on the notion of positive economic growth as a substitute for a national culture and purpose. Multiculturalism requires constant economic growth as replacement for a viable national theme. It is anti-nationalist. Since most people on an intuitive level do not really believe in multiculturalism, and it does not have anything substantive to offer, it basically buys people off with the promise of economic growth aka wealth "real soon now" (iSteve TM). That's why multicultists freak out anytime the economy tanks or nationalism rears its head. They know they cannot really compete with nationalism so they try and smother it in its infancy. That explains their current hatred towards Russia. Of course there is one glaring exception but I aint gonna delve into that."

100% correct.

Anonymous said...

he does not say that on his blog, he repudiates it.

He does not repudiate it. He points and sputters at Rush Limbaugh for mentioning it.

He claims he's for everyone, but more minority and fewer white men should get these jobs. That's what the brohaha is about.

No colorblindness or transracialism from Rabbi Reich.

Anonymous said...

Considering that the "old economy" under Bush was to bailout and subsidize a small group of well-educated but incompetent bankers, I can really see no harm in choosing to subsidize a bunch of lazy minorities instead.

After all, what are bankers going to do...riot?

Anonymous said...

White women simply despise most White Men because they won't keep their icky awful desires to themselves and won't be nice gay type guys, instead mess up their approaches to the few dominant Alpha men.

The solution's simple, T99: just make yourself over into an Alpha Man. Then you'll get the girls.