Category: Politics

Globalism made the middle class.

If an iPhone were made in America, it would cost more than $2,000. The price increase for most consumer goods (and components of American made goods) currently made in China would cost 200-300% more if they were brought back to America, and that’s not including initial investment costs to build all those factories.

Higher prices would also dramatically decrease sales of American products in other countries reducing the stock market value of these companies and limit national economic growth opportunities.

In 1971, one ounce of gold cost $35. Now it costs $1722, a 4,820% increase. One reason why is the same what caused the decoupling in 1971 – the value of the dollar is decreasing. The $3,000,000,000,000 printed this year alone will further drive down the real value of the dollar.

Cheaper goods from offshore manufacturing is one key factor why prices of goods in the US haven’t dramatically increased to cover the cost of a weaker dollar. Full inflation costs have been hidden from view through the process of propping up the middle class lifestyle with cheaper goods.

Globalism has made the middle class lifestyle affordable while hiding the cost of inflation. Our currency is in too much debt and or economy too reliant on others to become isolationist. As the Marshall Plan is the foundation of what “made America great,” the only viable path forward is a new Plan.

Fear needs an enemy. Activism needs a plan.

“First of all, let me assert my firm belief that the only thing we have to fear is fear itself – nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.” – Franklin D. Roosevelt

This quote came up in a recent conversation I had with my good friend James Hines. We were discussing current events and sharing theories of how our country was going to move forward. This is something I have been mulling over for months now. Why hasn’t America had a plan for dealing with Covid-19 and our nation’s recovery?

The first case in the US was nearly four months ago and other than the phased reopening plan, there hasn’t been a clearly communicated plan for the country’s response to the pandemic or what we’re going to do as a result of it.

Now our country is more fragmented than ever, casting dirty looks at each other based on whether or not we’re wearing a mask, and fighting each other on issues we have no control over. The disharmony has been roiling for much longer, but this current situation is bringing things to a head.

There are many examples of Americans coming together for a common cause – the New Deal, World War II, the 9/11 response to name a few. That is not to say I support the results of all those examples – the point is, the American people respond in big ways when duty calls. The difference this time is no leader has organized the American people behind a common cause.

What has happened is political leaders on all sides are name-calling, pointing fingers, shifting blame, and avoiding responsibilities to us, the unemployed, the sick, and the dying. This pandemic cannot be fought on a local or state level. There are measures that can be taken on these levels, but a national problem demands a national response.

One of Harry S Truman’s most famous quotes is “The Buck Stops Here” because he took responsibility for his decisions and their effects on others. There is a distinct lack of this mentality in Washington DC and it is hurting all of us.

Another one of Harry S Truman’s famous quotes is “The Marshall Plan will go down in history as one of America’s greatest contributions to the peace of the world.” Truman became president on the heels of World War II and led a nation unified by the war to the common goal of rebuilding the global economy.

This is the type of leadership we have needed since the pandemic first hit our shores. We are all hurting in one way or another and at the same time, we are all wanting better things for ourselves, our friends and family, and our country.

I see the activism on all sides as evidence that Americans want to take action – we want to rally around a common cause for the betterment of those we care about. Americans are clearly ready to join a cause, fight for their rights, fight the enemy, and even take up arms but who is the enemy?

I am having a hard time seeing how America recovers from these past few months without clear communication from our leaders. We are currently fighting ourselves, but we are not our enemy. As things stand, China is being made out to be our enemy, but we are an angry nation that has been at war with ourselves for years… and the powers-that-be use that to keep us divided, angry, and at war.

We’re all scared of what a virus is doing to the country, but we’re all capable of overcoming it for something greater than ourselves. As long as we are afraid of and running away from the other political party, politicians, media, and anyone who holds different views, we will not be able to “convert retreat into advance” and overcome the fear that is ripping this country apart.

Reopen the Economy

I find the “reopen the economy” debate intrinsically flawed for a few reasons, and infuriated that the choice between livelihood & life has been politically weaponized by our country’s leaders. Here are a few reasons why I see the Reopen Debate as nothing more than two intentionally narrowed perspectives of a very complex issue.

1. Your rights end where mine begin.

In a poll conducted over the last week of April, 65% of Americans said “having people return to work” would be a bad idea. Over 80% said it would be a bad idea for students to return to schools, open restaurants again, and allow public sporting events.

It doesn’t matter if everything reopened tomorrow, 65-80% of Americans won’t go to work, businesses, or events. Reopening tomorrow means maybe 20-35% of former economic activity will return and that’s nowhere near enough to “save the economy” and further increases the cost of each human life lost due to reopening too early.

2. He’s dead, Jim.

The US economy peaked in Q4 2018. Since then, the rate of growth had been decreasing and after an unprecedented run of economic growth, a slowdown or recession was inevitable. Policymakers can tease the economy through interest rates and other levers, but it is simply impossible to maintain growth forever. A decline was already happening – that’s a fact.

US GDP fell by 4.8% in Q1 2020, but at an annual rate of 30%, a rate not seen since the Great Depression. Q2 2020 is going to be much worse and reopening local businesses isn’t going to change that. The tidal waves from the trickle-down effects are only starting to hit the shore of the global economy, and reopening bowling alleys and hair salons to fix the economy will be as effective as a holding on to a pool noodle when the tidal waves hit.

3. It’s actually a zombie economy.

As recently as last year, 12% of publicly traded companies in developed nations were classified as zombie companies. That means they weren’t earning enough money to pay the interest on their debt, let alone debt, or grow as a profitable company. They are being propped up by cheap money and a “too big to fail” classification.

The number of zombie companies will certainly skyrocket as a result of this, but can we let the American airline industry fail when another country will prop up their airline industry to take over this sector of the US economy? That’s just one example. Consider that effect across all industries and the giant whooshing noise you hear in the background is the sound of the GDP being sucked away by foreign companies and oligarchs.

It’s not much of a choice, and how/why we got here is another conversation for another time, but without other short-term options at hand, I’d rather try to outrun a zombie company than face a foreign enemy with an economic howitzer.

4. Our collective future is built on speculation, not savings.

The highest interest rate available in the US for traditional long-terms savings vehicles in the last 20 years was 6% in early 2000 – exactly 20 years ago. It’s hovered between 1-2% for the last decade.

In that time, we have seen an explosion of investment in the stock market because it yielded better ROI. This is why it’s important the stock market stays healthy – it is America’s savings. Unless you’ve been content to earn 1-2% in a savings account or invested heavily in raw commodities, your money is directly connected to the stock market.

Since Boomers are the most heavily invested in the stock market and on the verge of retirement, letting the stock market crash is not only political kryptonite but economic suicide. Tens of millions of Americans watching their retirement and savings get flushed away in a few months would create absolute chaos.

5. Our collective now is built on speculation, not savings.

Everyone is asking why the stock market is holding up when unemployment is rising faster than your latest attempt at homemade bread. They’re also asking why companies don’t have six-months expenses saved for times like this. The answer is the same as above – most everyone is a speculator because it paid better than being a saver.

If the stock market crashed, so would speculation that our economy will get through this economic period. Our economic growth has been built on speculation for decades. While the disconnect between unemployment rates and stock market movement feels unnatural, it hasn’t been directly connected for a long time.

6. It’s the people, stupid.

With the exception of the US, every developed nation in the world has made sure that the people of their country had food for money, rent, and other necessary expenses during this time. The difference between responses is stark and no, it’s not because they’re socialist and we’re capitalist.

The $2,000,000,000,000 CARES Act was funded with taxpayers money. From that, taxpayers will directly receive $158B. That means the taxpayers will be receiving 7.9% of that money with the rest getting funneled to businesses of all sizes, most of it to large businesses. From another perspective, that constitutes a 92.1% tax rate on our money to save our economy. In light of that, the socialism vs capitalism debate is simply political posturing.

Please stop acting like reopening local businesses will fix everything when the people in power who could be helping us have chosen not to and instead are distracting us with anger-fueled, wildly-inaccurate political breadcrumbs to fight over.

Here’s a shortlist of a few things I’m hoping to see happen in me and those around me:

1. Invest the time.
Learn something. Read those books you’ve been ignoring for years. Write. (Mostly preaching to myself here…) In all seriousness, you will probably never have as much time and freedom to learn, grow, and orient yourself for the future as you have right now. Go back to school for a new degree. Start taking classes from Harvard, University of Michigan, and more on edx.org. Time is money and we should all be investing this time in wise ways.

2. We are not the issue.
Start paying attention and giving your time to people who care about you, not those who care about issues you care about. It’s the oldest bait-and-switch in the book yet we still fall for on a regular basis. We’re all guilty of “rallying around the flag” for certain issues but how many times have our leaders left us on the battlefield worse off than when we started?

I’ve adamantly supported my country for nearly four decades and in the time when I most need a return on that investment, all they’re willing to offer me is the promise of a $1200 check to get me through a few months. I’m ready for politicians that care about the individuals before issues and people before profit. Let’s make that happen starting this election cycle.

3. Don’t tread on us.
America needs a significant capital investment into community and national projects that will unite and benefit everyone like Eisenhower’s Interstate system. This will funnel money into Americans’ pockets, provide jobs for decades, and enhance our national infrastructure.

Stop listening to politicians dividing us on issues that don’t rebuild America for us, and start voting people into office who are willing to work through complex issues with care for the individuals involved and present us with a plan to rebuild America. Anything less is divisive and destructive to everyone, including you.

Liberate Responsibility

I’ve been thinking about the “Liberate State” movement and the part that I find most fascinating about is the incorporation of liberty & freedom as the core principles for their activism. Here’s why…

The Positive Liberty being called for is the freedom to live their life the way they want it – go shopping, get their hair cut, eat at restaurants… live the life they’ve built on core American freedoms.

The Negative Liberty being called for is freedom from the constraints that have been placed on them. These constraints have been perceived as the enemy and not Covid-19 itself. In short, the protestors feel like they’re being forced to live an unAmerican life and that’s not alright in their eyes.

I get that but haven’t we already been living under constraints our entire lives? Just because we like a constraint and incorporate it into our life doesn’t mean it’s not a constraint.

Socializing with friends at home instead of at a bar isn’t a loss of freedom, it’s a change of context. Doing different things with your time than before isn’t a loss of freedom, it’s a change of context. Context is a cage and a cage is a cage no matter what you call it.

Furthermore, the bulk of the protestors are Republican and supporters of Donald Trump – the person who is ultimately responsible for the constraints. The protestors are not directing their efforts at Trump or the federal government but directing efforts at state and local entities.

This is where the usage of the term “Liberate” by Donald Trump himself is fascinating. It appears he is telling his base to undermine the entities under Trump all in the name of freedom, but what is the logical conclusion to all this?

If state and local entities are undermined, that would strengthen the control and enlarge the powers of Trump (and any future President!) over the nation. This is intensely ironic given the platform of Republican politics is built primarily on Positive Liberty.

The movement wants to be “liberated” from perceived unAmerican forces, but where else does the effort of undermining local and state entities lead other than an ultimate force, an inherently unAmerican idea?

This is why I find the usage of “Liberate” fascinating. It’s true Orwellian Doublespeak in that the actions demanded by the movement are to return to a cultural cage of their own making in a way that advances authoritarian principles. The conclusions of the movement are anything but liberating for Americans.

I will conclude with one of my favorite quotes by George Bernard Shaw, “Liberty means responsibility. That is why most men dread it.”

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