Post WW2 International Economic Competitive Adjustment
New Normal # 4
History of U.S.
Financial Bailouts and
Bailout History The $700 billion 2008 financial-sector rescue plan is the latest of many bailouts that go back to the Panic of 1792 when the federal government bailed out states over-burdened by their Revolutionary War Debt. Thereafter private banks and investment bankers took over financial bailouts until the Panic of 1907 when the economy was so big that even J.P. Morgan needed U.S. Treasury help. This led to the 1913 Federal Reserve System designed to be the lender of last resort.
Recently the 1987
and Loan Crisis bailout cost about $160 billion.
Other recent government private sector bailouts have included: 1970
Executive Life Insurance Company by states assessing other insurers
Long-Term Capital Management bailout by commercial and investment
Great Recession Cost Was High
New Normality #5 Poverty Rate Stuck at 15.5%. After "...correcting the
2013 poverty rate for noncash food and housing
benefits, refundable tax
credits, and the upward bias in
the CPI-U ..."the rate drops from 14.5% to
War on Poverty-Was It Lost
Others believe it should be raised as
it doesn't account for geographic and demographics differences.
Poverty Rates How Flawed Measure Drives Policy
Data 2 Think many use true but not
necessarily appropriate data to foster their POLITICAL beliefs.
Example: With our obesity problem how could anyone have believed that many went to bed hungry during the
Great Recession. Calculation ignored food stamps and subsidized
Twenty-first century war expenditures helped profit recover after a dot-com bubble recession, then crash with The Great Recession and then grow to new heights. US Companies have competed very well in a flat world using technology, outsourcing to Asia, Mexico...and by keeping wage increases low. Source Total compensation has done better although Obama Care gave companies an opportunity to again lower compensation. Source More Data 1 Data 2 Think Rust Belt then NAFTA and soon TPP? See How Democratic Failed Workers 11 min Short Term vs. Long Term Returns 52 min
New Normality #7 Wellbeing Growth
1. Society's continued stability has resulted in tremendous economic growth which is the key determinate of well-being. Public safety net, child safety, and adjusted poverty rate have all improved dramatically since the Gilded Age. Think economic continued economic distress in Russia, Europe, Japan and China.
2) Scientific achievements have continuously added to citizen well-being. Think cured diseases, smart phones, streaming audio-video, Gillette Stadium ... See Health Problems Solved.
3) Personal Income increased continuously if not always rapidly because nature and nurture improved the personal characteristics needed to enhance wellbeing. Think Russia, China, and Europe's really slow recovery from the Great Recession. Source Is The Country In Trouble, Will Stagnate Income Hurt Our Children and Recent Decades Ranked By Problems. see Crisis of Capitalism 11:10 video is an interesting Marxian view i.e. Bernie Sanders Return to page 1 Send thoughts to firstname.lastname@example.org
Automation Will Continue, What Will Displaced Workers Do?
Should We Encourage Apple to Assemble Onshore? How?
#9 A New Western Normality in the Making?
I. Development of
summarized from Francis Fukuyama: Democracy's Failure to Perform
1. Foreign Policy Failures of Developed Democracy enhanced by U.S. foreign policy failures i.e. Middle East wars
2. Non-Liberal Democracy success, especially China
3. Poor Liberal Democracy Performance i.e. economic slowness, immigration, wealth accumulation
B. Definitions, nominal
1. States are a monopoly on a legitimate use of physical force. [107 from Max Weber States are about Power!
2. Rule by Law: sovereignty sets the law i.e. China
3. Rule of Law: sovereignty responsible to same laws as the governed. Laws limit power.
4. Democratic Accountability requires free multiple political parties with guarantee substantive accounting and a
government that serves the entire population, not just the elite.
C. Modern Political System
1. A modern miracle that generate tremendous power limited by the rule of law and is democratically accountable
2. Patrimonial state: rulers own political system, resources and distribute gain production Who You Know
3. Neo-Illiberal States: look like a democracy, limited representation, leaders follow the money
D. U.S. Failures at State Building
1. Focus: building a Liberal Democracy
2. Required focus: moving from Patrimonial State to Modern Political System
a. Iraq and Afghanistan: got the liberal democracy but did not move from a patriarchal to modern state
Both state moved to Oligarchy where a few wealthy people form a Plutocracy.
Neither can protect citizens and provide services to much of the population.
b. Ukraine: got a liberal democracy from the Orange Revolution of 2004-5, but could not keep it as a
second revolution needed to avoid a strong connection to Russia.
c. India: Very democratic but can't progress to modern state as it can't fix serious problems
Elected strong leader but he to is failing.
d. Greece: got a democracy in 1974 but developed into a Clientelism where every election brings a
new set of party connected bureaucratic. Strong unions kept jobs for previous bureaucrats.
Eventually, she had seven times the bureaucrats per person as did England.
Problem: Greece does not want to change.
II. Three main forces are blowing up global politics
Summary from author/editor Walter Antoniotti email@example.com
A Trio of independent disruptions
Social Cultural Apprehensions contributed to these disruptions.
Disruption modification related to Trump, and
Brexit, power immigrants
3. AI is increasing worker employment anxiety.
3. Climate change is increasing leader constitution.
A New Normal is in the Making?'America First' has won, by Robert Kagan at NYT.
Saving liberal democracy from the extremes, by the FT's Martin Wolf