A yes answer to a question with such scary implications begs
postponement �til another day . . . perhaps it is a question that should never
be answered, not out loud. Let�s just say that Uncle Sam has always appeared to
the world as an affable, worldly relative that they never quite really knew, or
understood; one who visited occasionally wearing fancy duds and displaying
graying hairs -- and cocky airs -- exuding both stability and success; someone
who made the world his oyster . . . and all the relatives envious.
Unfortunately, that uncle who visited his family during the
last two decades was more of a jobless, penniless relative who had whittled away
his fortune in fancy living and lousy gambling -- warmongering and selective
globalization may be more apropos -- schemes. And his visits started to be more
frequent, now inviting one and all to share in his �good fortune� . . . apparently
by investing in many of those schemes.
The reality of a recession is finally talked about by both
imbecilic and sage members of America�s Hope Springs Eternal society, and that
includes super-greedy Wall Street, a government in lying perpetuity and the
amenable Fed. Now, after all this time, when we know that we are already there
. . . or, at least, at the entry way!
Actually it�s not the �R� word that scares me, but the
possibility of the unmentionable capital �D� for depression. An �R� with fair
penmanship for much of the world, and a �D� with illegible calligraphy for the
US of A! Of course, there�s a chance that the White House and Congress might
create enough hocus pocus -- perhaps by �having� the Fed cut its rate 2 or even
3 points and throwing away another 150 to 200 billion dollars on the shoulders
of future generations -- to decelerate the economic bloodbath until past the
November elections, but the observed (even if hidden by the government) rate of
true inflation won�t allow smoke and mirrors to cloud reality, and America�s
economy will appear buck naked before the world, directed behind curtains by
the Wizard of Oz.
On Monday and Tuesday Asian and European markets gave us a
preview of their own nervousness with the US, even if this nation�s share of
the world�s GDP (now at just 28 percent) keeps, understandably, declining.
Combined losses averaged over 10 percent overseas, if mildly affected by Wall
Street losses on Tuesday (1.1 and 2 percent for the Dow and NASDEQ), told us
that America�s actions still weigh heavily in economic world affairs. And it
was also an icy reminder that the credit largesse by those creditor nations may
soon be coming to an end. Then, whose money will Americans be able to spend, er
. . . waste? Isn�t the US really following in the footsteps of Argentina,
Brazil, Mexico and Third World nations whose economic policies America has
criticized for so long?
America, the should-be creditor nation par excellence, has
become instead a parasite to the savings of the world, becoming the largest
debtor nation in the planet with only two possibilities left: one, allowing
America�s creditors to liquidate the paper for hard assets, permitting
once-proud Americans to become vassals to foreign capital; or two, change
America�s consumption habits . . . and learn to live within our means.
The precarious economic fix does not seem to be understood
by most economists, and even the elite in the profession make questionable
statements which seem out of the ballpark. Like Paul Krugman, whose judgment I
usually respect, asserting how complex the US economy is, when the adjective
should have been deceptive. Weren�t derivates supposed to have disappeared
after the dot-com fiasco? Instead, additional crooked financial instruments
were allowed to debut without proper scrutiny by a hands-off government happy
to see capitalism run amok in predatory ways to once again redistribute wealth
from middle-class to rich. Not complex, Dr. Krugman, just deceptive!
And all the while, those in the trade-brotherhood of economics
in solemn silence!
As I am writing this article engaged in the thought of the
applicability of physics� laws of thermodynamics to the art-science of
economics, I came up with what I thought to be a proper term to describe it:
econodynamics (or movement in economics). After Googling the word, however, I
discovered that it wasn�t for me to coin, that it had been used once before,
probably in a different context to mine, or in its seriousness.
For our purpose here, let�s just say that it would probably
be worth considering if our graduate schools of economics required their Ph.D.
candidates to have an academic background in engineering, at least through the
junior year, with at least knowledge of thermodynamics and quantum physics -- I
might add that it has helped me. Certainly a more appropriate complementary
background than that of politics! Knowledge about conservation of energy,
entropy and absolute zero temperature (the three laws of thermodynamics) can
certainly prove insightful to the understanding of economic growth, and the
treatment of production, consumption and savings . . . plus much more.
Perhaps Arnold Sommerfeld, the German physicist, had it
right, if this attribution to him is correct: �Thermodynamics is a funny
subject. The first time you go through it, you don�t understand it at all. The
second time you go through it, you think you understand it, except for one or
two small points. The third time you go through it, you know you don�t
understand it, but by that time you are so used to it, it doesn�t bother you
any more.� Substitute thermodynamics with economics and you may understand what
most economists are all about.
Religion, to have value for the human condition, must be
much more than just faith. In like fashion, economics should aspire to become
more of a science, and its practitioners must be more than just charlatans, at
someone�s service, with a fast sleight of hands.
Since both foreign policy and economic policy are thoroughly
enmeshed in the US, an economic bloodbath coming sooner than later might give
Americans a much needed push to finally clamor for the impeachment of Bush and
Cheney, the two men at the top who have brought this nation to such a level of
plight and misery; concurrently heralding impending exits from both Afghanistan
and Iraq; and also giving credence to the idea, that in the future, America
will only be solicitous with Israel when that nation brings to a halt its
dominance over Palestinians and engages in true negotiations for territorial
co-existence in peace; that Israel will remain a good friend and ally but will
not be allowed to hold the key to US foreign policy as it has done up to now.
� 2008 Ben
Tanosborn, columnist, poet and writer, resides in Vancouver, Washington (USA),
where he is principal of a business consulting firm. Contact him at firstname.lastname@example.org.