Proposal number 2 will destroy the US economy, completely destabilize prices, and make recovering from recessions painful and slow. There is a reason that no country today, including the ones that produce things, use the gold standard.
The Demoralization is just Beginning
181–190 of 812 posts
Re: The Demoralization is just Beginning
#182> Sure, we don’t produce anything, but we have companies with high revenues and we can raise money based on those revenues. We’ll both be rich!
I think this is the central hole in the argument that the US is stagnant. The money that investors give you has to come from somewhere! Particularly in venture capital, you only get returns if you produce value.
Nevertheless, I do agree with a lot of the points here.
Re: The Demoralization is just Beginning
#183Earlier quoted context omitted.
Ibn Khaldoun said that once a state economics start deteriorating, everyone becomes an expert. The way I see it, if the markets led by PhD and Noble laureates fails, people start looking for alternatives. Since the "establishment" has been proven useless, the door is open for "anyone" to chime in. The reality is that the economist at the top do not want to see the deficiencies because they have their salaries on the…
I don't think economics itself has gone wrong -- I think the US economy in particular has done a poor job of distributing the wealth it has created. Ironically, that has created a populist backlash that has vaulted even worse economic ideas into power. Anyone read "Capitalism in the 21st Century"? It's long and dense, but it does make some excellent, well-supported points about the structure of an economy that explai…
> I think the US economy in particular has done a poor job of distributing the wealth it has created.
The US financial system is structurally orientated towards distributing wealth poorly. It's an unavoidable economic fact that when someone spends newly created money there's a wealth transfer from currency holders to them (that's why counterfeiting is illegal), and in the US means there's a persistent, systematic transfer of wealth from currency holders to the banking/financial system. Which is extremely regressive, as poorer people hold the largest fraction of their wealth in cash, while the middle and upper classes have more of it in assets like housing and stock.
Economists funded by the banking system will try to distract you by arguing about inflation vs deflation, but it's a smoke screen. It's perfectly possible to have a non-regressive inflationary economic system, e.g. one where the government directly prints money and gives it to the poor, and such a system would avoid the systematic transfer of wealth from the lower classes to the financial industry.
Re: The Demoralization is just Beginning
#184Earlier quoted context omitted.
Democracy isn't created by intentions or "commitment," but rather the culture of the people, their attitudes, and mental processes. An Iowan born in Iowa to Iowan parents who were born to Iowan parents is steeped from birth in a culture that is very different from someone born in India or China--or even the American-born children of Indians and Chinese immigrants. Immigrants may become legally American overnight, but…
The book you cite and more generally the arguments traced in the Deep Roots literature are not very strong and often deployed to support anti-immigrant, anti-assimiliationist views. I'm not persuaded we could recreate America even if we took any 1000 people, even people who can trace their apple pie eating back to the Mayflower, because you know, America is a country and more generally complex arrangement of stuff th…
> often deployed to support anti-immigrant, anti-assimiliationist views.
So what? Immigration is optional. The people supporting large-scale migration from countries without functional democracies should have the burden of proving that cultural attitudes salient to democracy are not durable.
Even in the U.S., I'm not persuaded that the Anglo-American republic as originally conceived survived the mass immigration of continental Europeans in the late 19th and early 20th centuries.
> 'm not persuaded we could recreate America even if we took any 1000 people,
We have a real-world experiment of this! America, Canada, and Australia are all oddly similar countries, demonstrating strong alignments along many dimensions.
Re: The Demoralization is just Beginning
#185I prefer my economic takes from economists, or people who actually study these things. -there is more to an economy than manufacturing. Using manufacturing metrics to rate an economy is like scoring a soccer game based on how far your players run: in some contexts correlated with “winning” but in others it’s not. -gold is not a good currency or basis for monetary policy. -these ideas only sound self consistent withou…
>there is more to an economy than manufacturing
I don't agree with all of his premises or conclusions either, but I believe he's exactly right about the financial engineering and outsized rewards that frequently accrue to non-productive activity in general.
I see the manufacturing fall-off he notes as a proxy for that. It's not the only evidence, but it's one piece.
Re: The Demoralization is just Beginning
#186[dead]
Re: The Demoralization is just Beginning
#187This person sees the world as a game where the US needs to be a supremacy over others.
> America really is at a fork in the road. In one world, they abandon all hopes of being an empire, becoming a regional power with highly protectionist economics. This happened before, and it’s called Europe. I know it’s hard to believe now, but Europe used to be the seat of power for the whole world. The sun never set on the British empire. Now they put you in jail for memes
It's simply a disgusting take. Full of ego and lacking any empathy for people inside and outside the USA because he is too busy thinking in zero sum caveman terms.
This type of mindset is the one that justifies all military interventions because "there must be a world superpower and it must be us".
Re: The Demoralization is just Beginning
#188Earlier quoted context omitted.
seemed like a good article until he went into "back the dollar on gold" and revealed he was a total crackpot, sad
Care to elaborate? It’s thought provoking as a mechanism to reduce all of this zero sum (or even worse, parasitic) effort that dominates our system.
The United States tried this as a multi-decade experiment in the late 19th century. Greenbacks were taken out of circulation in order to increase their value in comparison to gold. It led to tightening of credit and was a drag on investment. Workers most frequently struck due to wage decreases. Farmers and other small business owners would frequently be unable to expand due to credit being unavailable.
The United States has attempted several times to use a gold standard. However, it results in unacceptable outcomes every time. In the 1970s, President Nixon led the US to leave the Bretton Woods system of fixed exchange due to trading partners converting excessive amounts of gold (specie). It has been found time after time that central banks need to adjust the value of their currency to account for financial shocks with countercyclical monetary policy.
Re: The Demoralization is just Beginning
#189Earlier quoted context omitted.
Democracy isn't created by intentions or "commitment," but rather the culture of the people, their attitudes, and mental processes. An Iowan born in Iowa to Iowan parents who were born to Iowan parents is steeped from birth in a culture that is very different from someone born in India or China--or even the American-born children of Indians and Chinese immigrants. Immigrants may become legally American overnight, but…
I think America in its best expression is an amalgamation of many different backgrounds and attitudes. Even differing opinions on the functioning of democracy, though I personally think some opinions denigrating democracy are a bit out of bounds and "unamerican" -- though that's obviously a "no true Scotsman" argument, I'm sticking to it. I guess I'm just arguing for a more expansive view of what constitutes an Ameri…
> I think America in its best expression is an amalgamation of many different backgrounds and attitudes.
In my view, the best expression of America is somewhere like Iowa--a flat society with intense, local self-governance. In every multicultural society, the democratic rapport that people have with each other ends up being replaced with relationships mediated by an increasingly large and bureaucratic government that can reconcile the conflicting cultures and interests. Democracy is reduced to mere voting.
Re: The Demoralization is just Beginning
#190> America really is at a fork in the road. In one world, they abandon all hopes of being an empire, becoming a regional power with highly protectionist economics
Seems like the current choice is to be highly protectionist, not sure if it means becoming a regional power.