The Only Road Out Of Davos
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Unknown Charleston, SC, after bombardment. Ruins of Cathedral of St John and St Finbar 1865 After 6+ (BIG +) years of deepening poverty and rising sto
[See the full post at: The Only Road Out Of Davos]How long do we have “to get people around you to understand why buying what their neighbors make at double or triple the price of what they pay for what comes from China will make them richer and better people”?
I think a lot of older people still understand this point. We remember making things and getting paid well for it. We remember when “Buy American” would have been a nonsensical slogan. (Duh! What else is there?)
Younger folks who have grown up with pure Free-Trade propaganda don’t understand. They are told to imagine higher prices as the penalty of Protectionism, and they are correctly repelled by that side of the equation when presented on its own. They aren’t allowed to imagine receiving more money in their paychecks.
I always ask where things are made. I can’t always avoid a ‘good deal’ but I try to buy North American. I bought Stanfields undershirts (made in canada) last year, I paid $35 instead of $20. That adds up when 5 packages are required.
I choose to support North American vendors/manufactures when purchasing products for our company. We all know know volume goes to China, but they can’t compete on lead time or customization.
It really is a different economy now. Central banking actions just encourage an increase in the cycle speed of boom to bust. The bubbles in beween are feeding frenzies for the financial class. QE is the active transfer phase of public to ologarch. By design or by acident, it is an acceleration of the return to two class society. Nuclear weapons keep the disruption of war far enough away to keep the upper class intact. At some point the model will break, either by war, climate change, pandemic, perhaps all of the above, leading to collapse. The more complex a network is, the more prone it is to sudden and total collapse. It’s hard to think it could get more complex than today. It is a very dark future ahead.
Nice. Thank, Ilargi.
I always feel I should be amazed when some body like the IMF lowers (or, perhaps occasionally, raise) their forecasts. It shows that they got it wrong the first time (and probably the second and third times) but the economists (and others) still lap up their every word as though it was gospel. They have very poor memories.
Ilargi. Excellent article.
I have once read that there is no basis for free trade at all. I have also read that free trade is for speculators and predators. Still more, I have heard it said that the high market buys cheap until the very process pulls down its standard of living to comply with world standards.
Furthermore….”A nation that degrades either the production or the income of its agriculture thereby condemns itself to war.”
You are right. Protecting your community from being gutted by economic ideas and systems is not evil at all. To protect is to love. Protecting your friends and family from those who kill, rape, and injure is just as righteous as protecting them from the economic killers and rapists. These evil people have worked hard through their propaganda machine to make protectionism sound evil.
It is good to trade locally, as you say, but it must be done fairly–with fair prices for goods and labor. The price of local goods that is two to three times the price of goods imported may be the right price, only because the imported goods have been produced by cheating the laborer and/or “cheating” the environment.
This only sounds stupid because our children, and our population, for that matter, have not been taught adequately about economics and money.
I always liked what John Stuart Mills said:
“Distribution in an institutional world had nothing to do with economics. The distribution of wealth depends on the laws and customs of society. Society decides how to share the fruits of the land–this fact moves the debate from impersonal and inevitable law to the arena of ethics and morality.”
Hah. Obama has declared the financial crisis to be over, in his SOTU speech. Well, there you are then. All it takes is a declaration by the boss man.
Well, you know, Tony Prep,
as Han Solo said to CP3O, “I’m glad you’re here to tell us these things.”
Ilargi,
Well, there you’ve gone and done it. You’ll more than likely be added to the list for calling out the Predator Class for exactly what they are: a giant skimming operation. The international criminal cartel of the elite few who are now untouchable. Yet the peons turn on each other. It would be almost funny if we were not such an integral part of the scam.
Hello,
I would be interested in obtaining more info on the statement:
“You see, a dollar spent on locally made products goes much further than one spent on products that are shipped in. About 4 times further.”
That is an extremely useful argument, but if I use it, I will need to substantiate and document it. So, any bibliographical references?
Thanks in advance,
XYZTrade Agreements:
“With Republicans regaining control of Congress, the Democrat establishment is scrambling to claim ‘political’ differences while President Obama and Congressional Republicans promote nearly identical economic agendas through trade agreements. […]
Of what value is Mr. Obama’s (nominal) support for raising the minimum wage if the trade deals he is promoting are designed remove the civil capacity for setting a minimum wage? What credibility do Mr. Obama’s environmental policies, such as they are, have when he is actively working to subvert the capacity for civil environmental regulation through trade deals? […] And with the TPP and TTIP Mr. Obama is trying to complete the circle— a specific purpose of the agreements is to replace civil governance in the public interest with supranational governance in the ‘private’ interest.”
https://www.counterpunch.org/2015/01/16/trade-deals-and-democrat-delusions/
From my reading of the upcoming trade agreements, it appears some countries are almost being bullied into signing, or maybe they’re just waiting until the bribes gets big enough. This world is completely insane, thanks to our leaders. Fight these trade agreements because their supranational courts (run by corporate insiders) will override what little sovereignty we have left.
XYZ, it’s from research I read maybe 10 years ago, by a female economist. Haven’t found it back. Maybe I should look harder. Or maybe you can help 😉
I find it strange that I don”t come across a lot more literature and research on the topic. The gist is very simple and easily understood: if the baker pays the butcher pays the carpenter pays the farmer pays the baker with the same money, and nothing is taken by people outside the community, everyone MUST get richer than when part of the money does vanish. That means, at some point, that you’re running to stand still. Or worse, as in today’s societies. That easy to grasp principle is more interesting to me than exact numbers, but let’s see if we can find more on this.
Take WalMart as an example. their costs are – broadly – purchases, transport, real estate and employees. A one-off profit on a building may – or may not – go to the community. That leaves only low-paid employees as ”beneficiaries” of the store’s turnover (plus a whiff of local veg – maybe-), while in many towns a substantial part of available money is spent there, that the store doesn’t spend back into the community. It’s how Sam Walton got rich. And you got poor. And how we got so many shitty jobs.
Ilargi,
Abraham Lincoln was asked whether we should import steel from Europe to build our railroad system, or whether we should produce the steel ourselves. He said something like this: I don’t know much about rails and tariffs and I don’t know much about railroads, but here’s one thing I do know. If we produce the steel ourselves, then we’ll have both the rails and the money.
Thanks for the info on local spending.
Raul, I understand the concept, it is simply that some factual data to back up the argument is always useful.
Ciao,
XYZFrom the aforementioned book, Local Dollars, Local Sense, by Michael Shuman (Chelsea Green, 2012):
“Every job in a locally owned business generates two to four times as much economic development benefit as a job in an equivalent nonlocal business. Local businesses spend more money locally, which helps to pump up what is known as the local spending multiplier.” (p. 18)
Table 1 (on page 19) lists an average “Local Jobs Advantage” of 2.6 resulting from studies done for various cities. Quoting the book again, “The local jobs advantage represents the relative number of jobs (direct and indirect) produced by a given purchase (say $100) from a local business versus the same purchase from a similar nonlocal business.”
Local currencies could take this further, as they generally cannot be spent outside the local area.
There is an important thing about Americans that has to be understood. Americans have always been eager to kiss the ass of the well to do and the more well to do the more eager they are to kiss. There are two principals involved I think.
One is the prevalence of thread of Christianity normally associated with Calvinism which suggests the rich are better. Their earthly reward evidence of God’s favor. This sort of thing is embedded in the culture , rarely if ever stated directly or indirectly and it’s religious root forgotten but take my word for it as an American, it’s there.
The other is strictly secular. That is if your nice and defer to the wealthier then maybe some of that wealth will flow your way. It is pure self interest. At a minimum you don’t want to be on record as being critical of them. De Tocqueville in Democracy In America commented on this and thought it unseemly. He was an aristocrat who was skeptical of Democracy and believed in well defined social classes. He maintained that this eliminated such petty self interested sucking up to one betters and striving which resulted in more honest social relationships.
The point is nobody is anybody or who wants to be, in America, is going to be dumping dirt on the denizens of Davos.
There is another thread in American culture where nativist populists of the right, which was always the largest group of American populists, always hated big money financiers. Well they did until Reagan. Now in America the huge rightest movement lead by a sprawling and diverse media presence is all in with the uber rich.
>>And to do that, we first need to know what exactly the model is.<<
The model is Debt Money Tyranny – the one subject you seem unwilling to touch even though 5th grade level math proves the prima facie fraud of the system.
If Banksters generate $20 for society based on 5% debt, then society owes the Banksters $21 in a year’s time, BUT SOCIETY ONLY HAS $20. The debts are inextinguishable.
That’s the math that underlies Henry Ford’s observation…“The one aim of these financiers is world control by the creation of inextinguishable debt.”
~Henry FordThere is a reason they call the debt paper associated with the generation of money “bonds.”
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