We happy few
This weekend, The New York Times published an op-ed piece on the failing American economy by David Stockman, Ronald Reagan's budget director from 1981 to 1985. Please print it out, post the important paragraphs on your refrigerator door, and email the piece to all you friends and family. Stockman's somber, funeral op-ed lays out his belief that the American economy has already driven off the cliff, that we're now in a slow freefall, just a few crises away from slamming into the ground.
Since the S.&P. 500 first reached its current level [above 1,500], in March 2000, the mad money printers at the Federal Reserve have expanded their balance sheet sixfold (to $3.2 trillion from $500 billion). Yet during that stretch, economic output has grown by an average of 1.7 percent a year (the slowest since the Civil War); real business investment has crawled forward at only 0.8 percent per year; and the payroll job count has crept up at a negligible 0.1 percent annually. Real median family income growth has dropped 8 percent, and the number of full-time middle class jobs, 6 percent. The real net worth of the "bottom" 90 percent has dropped by one-fourth. The number of food stamp and disability aid recipients has more than doubled, to 59 million, about one in five Americans.
While Obama's policies have jammed the debt accelerator to the floor, the Bush Administration is just as culpable, with the idiotic TARP bailouts and by willfully ignoring the looming housing bubble created by Wall Street's absurd addition to monetizing sub-prime mortgages. Didn't any of these dozens of "brilliant" government economists ever run a small business, struggle to meet a weekly payroll, or forego a pay check so that the business could pay it's utility bills during a slow month? Nope, didn't think so.
".....the White House, Congress and the Fed, under Mr. Bush and then President Obama, made a series of desperate, reckless maneuvers that were not only unnecessary but ruinous. The auto bailouts, for example, simply shifted jobs around - particularly to the aging, electorally vital Rust Belt - rather than saving them. The "green energy" component of Mr. Obama's stimulus was mainly a nearly $1 billion giveaway to crony capitalists...."
Less than 5 percent of the $800 billion Obama stimulus went to the truly needy for food stamps, earned-income tax credits and other forms of poverty relief. The preponderant share ended up in money dumps to state and local governments, pork-barrel infrastructure projects, business tax loopholes and indiscriminate middle-class tax cuts.
California (duh!) is still attempting to build the first twenty-nine mile leg of high-speed rail systems from Madera to Fresno (this is not an April Fool's joke) in the state's agricultural heartland, the Central Valley.
Using the numbers from recovery.gov, the website that explains, sort of, how the ARRA stimulus money was spent, we find that the state of New York had created 5,856 "recipient reported jobs" at cost of $14.321 billion. That's about $2.4 million per job.
California had 14,079 "recipient reported jobs" at a cost of $27.254 billion. About $1.9 million per job.
The state of Washington used $3.3 million for each job. Ohio ran $1.7 million per job, and thrifty Florida spent only $1.1 million on each job created with the ARRA stimulus funds. Will you be remembering these numbers as you pay your Federal taxes on April 15th this year?
More from David Stockman's op-ed:
Without any changes, over the next decade or so, the gross federal debt, now nearly $17 trillion, will hurtle toward $30 trillion and soar to 150 percent of gross domestic product from around 105 percent today. Since our constitutional stasis rules out any prospect of a "grand bargain," the nation's fiscal collapse will play out incrementally, like a Greek/Cypriot tragedy, in carefully choreographed crises over debt ceilings, continuing resolutions and temporary budgetary patches.
The United States is broke - fiscally, morally, intellectually - and the Fed has incited a global currency war (Japan just signed up, the Brazilians and Chinese are angry, and the German-dominated euro zone is crumbling) that will soon overwhelm it. When the latest bubble pops, there will be nothing to stop the collapse. If this sounds like advice to get out of the markets and hide out in cash, it is.
A financial meltdown is coming to America (unless we are dragged into a global war in the next 18 months). Based on your level of risk aversion, there is an entire spectrum of actions that may be considered to help protect you and your family: from the weekend gardener canning home grown vegetables to purchasing rural farmland and going entirely off grid.
Here are three actions I might suggest, to prepare for the coming financial meltdown.
1. Keep six months of monthly expenses in cash, outside your bank. If you still believe that what happened to the bank depositors in Cyprus, can't happen here, you needn't bother reading the next two suggestions.
2. Have a reasonable plan for feeding, obtaining drinking water, and providing heat and shelter for your entire family and a good friend's family for four to six months.
3. Start today. Start by clearing shelves, planning meals and buying the supplies needed to store food and water. Begin purchasing seeds and garden supplies to plant a vegetable garden this spring. Get your bicycles in good working order. Start today and do a little each day.
Americans are at dangerous crossroads, as the previously fixed constitutional safeguards between a citizen's individual rights and rapacious government overreach are being swiftly dissolved. The hard progressive Left's bizarre drive to micromanage our bodies, our air, our food and water, our private property, our guns and even our thoughts reveal the Orwellian hell in store for America. All the while the MSM tells us that our newly affixed handcuffs and leg irons are necessary tools to ensure safety and fairness, and to end the disproportional disparity in outcomes that white working men have devised in their pursuit of a racially pure, homophobic, misogynistic society.
We are being forced to our knees by the radical ideas daily forwarded by this malignant Administration, hell bent on disarming citizens, muzzling dissent, impoverishing working Americans, and purposefully creating economic chaos to foment a proletariat revolution. But then, what will happen to those racists white working bourgeoisie who paid their taxes, attended church and voted against Big Brother?
We few, we happy few, we band of Bill Ayers's incorrigible 25 million capitalists, we will then recall the blood soaked baskets of the Place de la Concord.
bumped,m spelling of Cyprus corrected [with red face]