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It's still the economy, stupid
It was unthinkable just six months ago.
According to all the right reporters who always quote all the right economists who are always wrong, we were in an economic recovery.
If so, why did the unemployment rate in the Charlotte region just inch up to 10.4 from 10.3 in April? We were told that if we passed the near-trillion dollar stimulus package, it would keep unemployment nationally from passing 8 percent. That went smashingly.
In a speech last week, Fed chairman Ben Bernanke, one of the biggest cheerleaders for the stimulus, finally admitted that he doesn't know what's wrong with the economy, then assured everyone he could fix it anyway. He's the guy printing trillions in fake money to save us economically — from what, he doesn't know. And he's been at this since the Bush administration, which he also served in.
As usual, Bernanke was full of it. He knows exactly what is wrong with the economy. There never was a recovery because there never was a recession. We are not in a depression, at least not in the traditional economic sense. And no way is this a double dip recession. All of those things are caused by economic phenomena that are largely temporary.
What we are experiencing is the economic reality of socialism. This is a big-government socialist country, just like France. We may not spend our money on exactly the same things, but our government's borrowing and spending impacts the country the same way. From 1983 to 2010, French unemployment averaged 9.54 percent, about like ours now. The French have for decades accepted that the price of European-style socialism and the security that comes with it is economic stagnation and near double-digit unemployment. They've shrugged their shoulders and gone on, at peace with their choice. I admire this about them.
Not so here. We are baffled as to why the unemployment rate won't go down. Some Americans blame Bush, others Obama. But what is actually going on here is that there is no longer a fake real estate boom to hide the true state of our economy from us. We are looking full on at the economic reality we have chosen and we don't like it, so we use words like "recession" to fool ourselves into thinking it is a temporary dip. The truth is that we've gone full French, and we are too dense as a nation to see it.
Politicians in Washington engineered the fake housing boom by incentivizing easy, sleazy lending. It served members of both parties well, and they were so desperate to keep this charade going that they backed the buying of loans everyone knew were bad with taxpayer dollars or implied promises of taxpayer dollars to keep the real estate market booming. Anything to keep the American people from finding out the truth — that we had become the French socialists we'd spent so many years looking down our noses at.
A country with the highest top corporate tax rates on earth among industrialized nations at near 40 percent when state and federal taxes are combined can't compete with places that now have rates in the teens. We've watched our blue collar jobs exit the country for a decade while other nations slashed theirs by double digits.
We covered up the damage our tax rates and our obscene spending did by engineering fake real estate demand on such a grand scale that nearly 20 percent of homes in Florida now sit vacant. Meanwhile, we lied to ourselves about the damage large-scale government spending does to an economy. (That's not to say that large-scale government spending doesn't do good things, like ensure survival. It just does it at the price of economic stagnation. Neither side of the political spectrum will fully admit this.)
We are now facing a choice, and it will be fascinating to see what the American people do. Give up our entitlement-laden lifestyle to bring back the economy we "had" and think we deserve, or accept the current, French-style unemployment rate as an unavoidable consequence of our big-government entitlement state, at the cost of dramatically diminished lifestyles and extreme difficulty in career advancement.
I just wonder how long it will take before Americans figure this out.
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