Anglo Disease - early signs of hangover generate denial | 49 comments (49 topical, editorial, 0 hidden)

The gap between imports and exports shows how much of the USA's apparent prosperity has been borrowed. and considering how so little of that has been going to 99% of the population, it's a good indication of the size of the loot captured by the other 1%.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Thu Nov 22nd, 2007 at 09:14:53 AM EST

Re: The Anglo Disease gap (4.00 / 7)

Hmmm.....

Althought the push is to identify the economic situation in which the US finds itself as the responsibility of the Bush administration alone, when you look at these graphs its obvious that the underlying problem began much earlier during the Clinton adminstration.

And if that's the case, it seems that the two great "victories" of the Clinton administration: 1)The expansion of trade without the adoption of trade rules similiar to what the EU has in the acquis communitaire, and 2) the destruction of the social safety net, i.e. welfare to work, deregulation,etc appear to have laid the foundations of utter economic disaster 10-15 years on.

It almost seems to suggest that the Clinton "miracle" consisted almost entirely of borrowing from the past savings and getting loans from foreign powers. Needless to say I'm not impressed with what Clinton did, but the bigger problem is that the current thinking in the US is that happy days will be here again if we ditch Bush. The problem with that being, that it does nothing to confront the underlying unsustainability of the current economic model. And the same people who pushed bad neo-lib policy during the Clinton administration are now advising the two front runners in the Democratic primary.

And people are more interested in talking about the novelty of having a woman or a black man as president than looking past the bullshit about that being change to realized that the race or gender of a nation's leader has zero effect on working people's lives unless there's a fundamental shift in economic thinking in the country.

And I'll give my consent to any government that does not deny a man a living wage-Billy Bragg

by ManfromMiddletown (manfrommiddletown at lycos dot com) on Thu Nov 22nd, 2007 at 10:21:56 AM EST
[ Parent ]

Re: The Anglo Disease gap (none / 1)

What happened to US exports in 1997?

We have met the enemy, and he is us — Pogo

by Migeru (migeru at eurotrib dot com) on Thu Nov 22nd, 2007 at 10:41:44 AM EST
[ Parent ]

Re: The Anglo Disease gap (none / 1)

There have been a couple of things that have really crippled US exports. Foremost among them has been that US companies (headquartered in Bermuda of course) started to source product from Chinese factories in the 1990's. During the late 1990s this started to shift out of textiles and basic goods into things that had been value added goods. I'm talking about aftermarket auto parts (auto parts not made for use in the auto industry but for repair by mechanics), consumer electronics, etc.

Previously, much of this had been sourced from Mexico and Latin America. And Latin America has traditionally been one of the best markets for American export. The Mexican economy has been under attack from cheap Chinese imports both internally and in it's exports to the US.

And I'll give my consent to any government that does not deny a man a living wage-Billy Bragg

by ManfromMiddletown (manfrommiddletown at lycos dot com) on Thu Nov 22nd, 2007 at 10:50:49 AM EST
[ Parent ]

1997 (none / 1)

is when Greenspan did nothing about "irrational exuberance" - ie the start of the dotcome bubble.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Thu Nov 22nd, 2007 at 11:07:02 AM EST
[ Parent ]

Re: 1997 (none / 1)

How does the dot-com bubble explain a drop in exports?

We have met the enemy, and he is us — Pogo

by Migeru (migeru at eurotrib dot com) on Thu Nov 22nd, 2007 at 11:07:52 AM EST
[ Parent ]

Oh, right (4.00 / 2)

Re exports, I suppose it's the Asian crisis. The economies over ther took a dive, and their imports must have dropped.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Thu Nov 22nd, 2007 at 11:23:27 AM EST
[ Parent ]

Re: Oh, right (none / 0)

But exports never really recovered (as a fraction of GDP, that is).

We have met the enemy, and he is us — Pogo

by Migeru (migeru at eurotrib dot com) on Thu Nov 22nd, 2007 at 11:50:56 AM EST
[ Parent ]

Re: Oh, right (4.00 / 2)

Or their (the Asian) economies regrew on the back of the transfer of manufacturing jobs.

Money is a sign of Poverty - Culture Saying

by RogueTrooper on Thu Nov 22nd, 2007 at 01:06:30 PM EST
[ Parent ]

Re: Oh, right (none / 1)

'97 to 2000 were boom years in the US. Don't know if it's that odd that imports would rise quicker than exports. Quickly rising GDP means that exports were still rising quickly, imports just more quickly. You might ascribe it to a lot of foreign investment in the US in this period and a strong dollar. What happened in 2000 is far more drastic.

by nanne (zwaerdenmaecker@gmail.com) on Thu Nov 22nd, 2007 at 09:38:16 PM EST
[ Parent ]

Clinton (4.00 / 3)

I'd agree that some trends predate Bush, but there are some differences:

rather more competent government, including the complete elimination of the budget deficit. No insane tax cuts focused on the rich (in fact, Clinton increased taxes), no out of control pork and MIC spending, no draining wars;
monetary policy, while too loose, was not as scandalous as during the Bush years - especially given he respective fiscal positions;
the Clinton administration had a real 'strong dollar' policy, and it showed;
the dotcom bubble was, in some ways, inevitable, as it was a burst of investment in a brand new technology. A lot of the money was wasted, but it also brought about a whole new industry, new technologies and more. There will be no Google from the Bush/Greenspan born out of the housing bubble.

It was tamed neoliberalism, and it was decent center-right economic policy.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Thu Nov 22nd, 2007 at 11:16:49 AM EST
[ Parent ]

Re: Clinton (none / 1)

I think MiM's point was that it set precedents which the Bush crazies could easily exploit to push their extremist neo-lib agenda.

Without an agreement that off-shoring is acceptable and we're all going to one big happy service economy from now on - q.v. the dot-com economy as the prototype both for Enron and for the housing bubble - Bush would have had to start by dismantling a centrist narrative, and not just by (e.g.) taking offshoring for granted.

The fact that the middle classes did well under Clinton shouldn't excuse the fact that he was still a centre-rightist, whose main interest was always 'the economy' (i.e. Wall St) and not so much other participants.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Thu Nov 22nd, 2007 at 12:54:09 PM EST
[ Parent ]

Re: Clinton (4.00 / 5)

Both major US political parties are "crazy." The difference is the extent to which they have traveled down the path.

When two people claim there are evil Martians living in the basement, and you have a XOR decision point, the difference between one saying to placate the Martians the house must be destroyed and the other saying to placate the Martians only the kitchen and bathroom(s) need to be destroyed is important. With the latter at least the walls and roof are still there.

During the Bush administration the crazies have spent much time and energy tearing down the house. During the Clinton administration only the kitchen and bathroom(s) were 'reformed.' People, naturally, look back at the period when the walls and roof were still there and say, "Gosh it was nice when we still had walls and a roof and wouldn't it be great to get them back?"

Expanding the analysis --- ;-)

Since both parties depend on wide acceptance of the proposition there are evil Martians living in the basement for their existence neither looks kindly on those pointing-out there is, in fact, no evil Martians living in the basement but there are problems with the oil heater in the basement, the water pipes are clogging, and summer is coming on and the air conditioner is broke. Naturally the parties, when getting this looks at the one making the argument and either flatly denies there are problems with the oil heater in the basement, the water pipes are clogging, and summer is coming on and the air conditioner is broke or, the slightly less crazed, says "Yes, there are problems with the oil heater in the basement, the water pipes are clogging, and summer is coming on and the air conditioner is broke BUT there are evil Martians LIVING in the BASEMENT!"

shrug

Ever since I learnt about confirmation bias I've started seeing it everywhere

by ATinNM on Thu Nov 22nd, 2007 at 02:33:46 PM EST
[ Parent ]

Anglo Disease - early signs of hangover generate denial | 49 comments (49 topical, 0 editorial, 0 hidden)

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