American Elephants

Don’t Let Anyone Tell You This Is The “New Normal.” by The Elephant's Child

I want to quote AEI’s James Pethokoukis here:

Nations probably never choose decline, at least not consciously. More likely they become victims of a creeping normalcy. Things once objectionable can become passively acceptable if they happen slowly, incrementally: the boiling-frog syndrome. Decline just sort of happens, year by year, decade by decade, one “meh” economic report at a time.

The important phrase is “creeping normalcy,” accepting as normal and natural a situation that is anything but. Obama has had four years, going on five, of over 7% unemployment. That is neither normal nor acceptable. When the Labor Department reported a decline in GDP and a rise in the unemployment rate to 7.9%, we should be angry about it. It doesn’t need to be this way. We have a history of successful recovery from downturns, and we know how to do it.

The economy added 157,000 net new jobs. Obama apparently sees this as progress, but at that rate of job creation, all else being equal, the economy would not return to 4.4% —the George W. Bush administration’s low point — for another eight years.

A president actually concerned about growth would have followed some of the recommendations of his Jobs and Competitiveness Council. He would have approved a pipeline. He would have expanded domestic oil and gas drilling, and fixed the corporate tax code. He would have put a brake on new regulation. Of all the things that may be wrong with our economy, a lack of enough regulation is not one of them.

This is not the new normal. This is the result of deliberate choices by a president who values payback for his supporters more highly than creating jobs. When something goes on too long without real signs of progress, it’s easy to slide into thinking that this is just the way it is, and it will always be like this, Do not accept sluggish growth and high unemployment as normal. This is not normal, it is defeatism. Fight back.

More Bad News, And Nobody’s Doing Anything About It. by The Elephant's Child

July unemployment was up in 44 states.  More than three years after the economic recovery began in June, 2009, ten states still have jobless rates of 9 percent or higher. Nevada’s unemployment rate climbed to 12 percent, New Jersey’s rose to 9.8 percent and North Carolina’s rose to  9.6 percent.  The states with the highest rates Nevada, Rhode Island -10.8 percent,  California – 10.7 percent, New Jersey and North Carolina all voted for Obama in 2008.

The four states with the lowest jobless rates are North Dakota -3 percent, Nebraska – 4 percent, South Dakota – 4 percent and Oklahoma -5 percent, all solidly Republican states. Very Democratic Vermont a;sp had 5 percent. 19 states have lost a combined total of 91,000 jobs in  July. Since Obama took office only 16 states have seen a net gain in jobs.

The monthly gain has been just 122,000, which is below the number for population growth. The White House now doesn’t expect unemployment to dip below 7 percent until 2015.  The year before the recession began, the unemployment rate was below 5 percent.

There is a multiplier effect, but not where Obama thinks it should be. When drilling permits are not issued in the Gulf, restaurants do less business, some go out of business, businesses that supply oil rigs go out of business.  When the Keystone pipeline does not get approved, the suppliers who make pipe go out of business, new restaurants, hotels, offices along the pipeline never open. Empty storefronts proliferate. Businesses move and workers move. The unemployment rate in the Detroit metro area— Obama’s success story— is now 10.2 percent and has climbed in each of the past three months. Many articles predict that GM will go bankrupt again shortly. Maybe this time they can go through an orderly bankruptcy, and let bankruptcy judges handle it.

It didn’t have to be like this. And we can recover.

A new study from the Cleveland Fed says: “In general, recessions  associated with financial crises are followed by rapid recoveries,” but not the Obama recovery.  We were not destined for a long recession, and this is not “the New Normal” as Obama surrogates are trying to suggest.

The San Francisco Fed suggests that the housing collapse is not to blame for the weak recovery. If housing were the villain, the states that didn’t suffer such big home-price declines would be doing a lot better than those that did— and they’re not.

Three years on, and the current unemployment rate is 3.9 % — that’s the U-3 number which doesn’t mean much of anything because of the enormous numbers of people not included. The U-6 rate which includes people who want to work but have given up, and stopped looking. And that’s not really high enough. There are still people not included.

The important fact is that Obama appointed a commission to deal with the deficit, and he chose good, serious people. And they came back with a serious plan. But Obama did not follow through on the Simpson-Bowles Report. He did not push Congress to adopt Simpson-Bowles, nor did Congress adopt it.  Obama preferred to just wait, spend, and hope that the magic multiplier effect would start to work, or the economy would just change its mind and start recovering. Maybe Valerie Jarrett told him that it was safer to do nothing.  Who knows.

What is clear is that Obama chose to not listen to any of the suggestions about policies that have worked in the past. He just wanted to do more of the same. More stimulus, more green jobs, more solar arrays and more wind farms, and more shutting down of any access to our own vast supplies of energy. He does not change his mind. Besides, he’s too busy campaigning. Nothing has changed and there’s not much hope.

Ignorance of the Past Leads to Folly in the Present! by The Elephant's Child

Investors Business Daily has a column today suggesting that the burgeoning theme in Washington, quietly whispered among the power brokers is — the “new normal.” I recognize that one.  We’ve been here before.  The American Dream is over, Japan is Number One.  Oh wait — that was way back in January, 1990.

I have seen articles suggesting that unemployment is destined to remain high—permanently. Manufacturing will continue to shrink. A home is not a good investment. There will be no more high paying jobs (well, except in government of course, where all the bright people are).   The U.S. is not going to be a fast-growing superpower, and we need to stop acting like one.  We need more government agencies run by the best and brightest  to take care of all the people who are displaced by the ‘new normal.’  It is unfortunate, but we must resign ourselves to double-digit unemployment.

The world is running out of energy, so we must live more sustainable lives. We must use less energy, less precious water.  We can no longer afford to squander space and energy and wealth on strip malls and suburbs. We need more sustainable communities and more  sustainable lives in more compact sustainable cities. All stuffed in there, cheek to jowl. That’s “the new urbanism.” Another lefty dream. See this interesting graph!

China could pass the United States as the world’s largest economy as early as 2016.  The International Monetary Fund said that back in April.  This assumes that if China is growing at 10% today, it will always grow at 10%.  China made a big mistake with its one child policy.  By 2040, China’s elderly population will exceed the total population of Germany, France, Britain, Italy and Japan. Every elderly person will be supported by two workers. Good luck with that. Will they dispose of their elderly as they have disposed of those unfortunate girl children? And what about all those young men who cannot find wives? Will they fill up their empty cities?

This is straight line thinking. If unemployment is high today, it will always be high.  If we are short of energy today, we will always be short of energy.  Nothing will ever change. You will notice that men are still wearing powdered wigs and writing with quill pens. The ships that ply the ocean are propelled by canvas sails, and it takes a long time to get anywhere.  And we are still a small nation of 13 states.  Nothing will ever change.

We have an unusual number of people invested in predicting the future, not only in silly media columns. They have devised computer models to predict the climate in 50 years and 100 years, and are busily trying to make regulations and laws to prepare for the future predicted by their computers. Odd, when our best weather forecasters have trouble predicting the weather for the following week.  Seven days is about their limit.

America was settled by people who had the courage and independent spirit to pack up and cross a vast ocean in a voyage that lasted months rather than days. They knew little about the wilderness that awaited them.  They built their own communities and made up their own rules.  And once the towns got too big or the rules too onerous, they packed up and moved on to where they could again build their own communities and make up their own rules.

Because it was a new country, they had to find ways to adapt, to create and  invent to cope with a new land and new surroundings.  There was no heavy hand of government to spell out what they could and could not do. They started out trying to create what they already knew, and as they changed the land, the land changed them. American exceptionalism derives from that creative, independent spirit.  How odd that our current president should see this country as no more exceptional than any other.

How very strange that the left insists that the American Dream is to be found in “the new normal” and in “the new urbanism.” Have to stamp out all that independent spirit! The government will nurture the creativity, we just need an agency to direct it into the correct path.

Ignorance of the past leads to folly in the present. Freedom and democracy require a modicum of truth to survive. I like these lines from Bruce Thornton’s Plagues of Mind:

The importance of history lies in its ability to give a sort of visual depth to our expectations and ideas, to place them in the only context that matters—the dense and intricate record of what humans have thought and attempted and experienced, their successes and failures, their nobility and pettiness.  History gives us ideals to strive for and failures both practical and moral to avoid. By familiarizing ourselves with the record of humanity’s deeds and crimes, we achieve a critical distance from the manifold passions and interests of the present, and we win a calm space in which we can judge with a cooler eye, the hectic novelties and temptations bombarding us.  Without that, we fall into the trap of judging everything from the standards and “knowledge” of the present.

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