Claims On Tomorrow

Our economy is based on growth. Without it there's no way to service interest payments on debt. Nonetheless, I find it hard to understand how 2.4% growth is considered anemic. It's growing, yes? Shouldn't that be good enough?

Debt is a claim on tomorrow's wealth, and we Elk Grovians and for that matter the rest of you in our grand nation have an awful lot of work tomorrow to pay off today's debts. But what kind of work do you suppose that will be?

In the developing world, the only economic model they have is to export consumables to nations like ours. Their economic growth is based on selling stuff to us, which pulls up their standard of living. Turns out that the best way to combat poverty in Asia is for us to consume more. As they expand their manufacturing base, it takes ever increasing consumption here in Elk Grove to keep them working, to expand their economies. We've outsourced the production...but not the consumption. Consumption is our role in the global economy and we're pretty fucking good at it. Look around you, with your laptop, 2.1 vehicles, electric power gadgets, plastic fans, lampshades, roads, bridges, and ironing boards. You are an excellent consumer, very good at it.

But! We've outsourced many of our productive jobs and as we continue to send out more jobs every day, fewer of us can afford to increase our consumption. So we borrow; more debt to pay for more stuff to keep our economy going. And so it is that during our little recession, while personal debt is being reduced voluntarily, our governments are massively, massively increasing their debts, so on the whole our economy is still based on increasing debt, still dependent on a growing share of tomorrow's wealth.

This cannot last, but we're going to continue to deficit spend because we have no other model, and in my little view, this can only lead to living less extravagantly in the future.

Yesterday on NBC news we heard from $30/an hour factory workers in Winchester, VA, who are no longer going to earn $30/hour as they are no longer going to manufacture light bulbs. Lost in this reporting, indeed, intentionally ignored in this report, is how CFLs are exclusively produced in China, so these workers have no options available to them to convert to the manufacturing of CFLs, because they can't compete with $4/hour Chinese. A few more manufacturing jobs were lost yesterday, alongside a few million earlier losses. Not two hundred yards from my office where I work, we lost 60 manufacturing jobs in 2009 when Kramer Carton closed up, shipping their manufacturing apparatus to eastern Canada, where Canadians will produce cartons for apple juice, for chocolate bars, for Ziplock bags, for American consumers to consume.

But how do you suppose a worker, who used to make $30/hour making stuff, is going to be buying apple juice, chocolate bars and Ziploc bags to keep our economy going when he now only makes $14/hour in his new retail sales job at Target or other "service related" job?

He's not...not unless the government steps in and spends a trillion and a half each year of tomorrow's wealth (read: borrowed dough) to fix up foreclosed homes for resale, to build more fucking highways, to stimulate sales of artificially inflated housal units, to stimulate the selling of more cars via cash for clunkers...on and on.

You had better get used to living with less, dear reader. This is my opinion, based on my observations. Our consumers will consume fewer consumables relative to today's consumption of consumables. That is not to say that we have to accept a decline in our standard of living; no, not if we increase our political freedoms, social equality, our opportunities to live in decent communities, increase our access to clean environments.

But. I don't see this happening in my America. I see us attempting to continue suburban sprawl, suburban consumption, road building, housal unit consumption, foreign energy consumption, wars for freedom, wars on drugs, wars for war, until it tears us apart at the seams because it's not sustainable, and at some point we will have to stop growing. I am the ultimate pessimist, but that's a good thing methinks, as I have prepared for the worst. Today, I live in the best.