13 April 2009

So Not the Time For the Stampede

I'm not sure if it's really getting lighter at the end of this economic tunnel, but some indicators are looking better. Some credit is starting to flow. Home sales in my metro area are up from last year. My many stocks are creeping away from 52-week lows. Not high cotton, but hope that the climate is slowly improving.

Remember when gasoline was $4 not too long ago? Well it managed to find it's way back to the $2 range by only market forces. While government clowns blustered and paraded, the situation really "fixed itself," at least for the time being. My dream is that our nation's economy gets back on track and shows tangible improvement before all of the preposterous government cash burning ever leaves the barn. Wouldn't it be neat if there was a popular cry to trash the stimulus s unnecessary? I'm not holding my breath:

Obama promises communal goals and a more widely shared prosperity. The trouble is that it may not work as well in practice as it does in Obama's speeches. Still, congressional Democrats press ahead to curb global warming and achieve near-universal health insurance. We should not be stampeded into far-reaching changes that have little to do with today's crisis.

Since the dawn of the Industrial Age, this has been simple: produce more with less. ("Productivity," in economic jargon.) Mass markets developed for clothes, cars, computers and much more because declining costs expanded production. Living standards rose. By contrast, the logic of the "post-material economy" is just the opposite: Spend more and get less.

What if U.S. cuts in greenhouse gases are offset by Chinese increases? What if more health insurance produces only modest gains in people's health? Obama and his allies have glossed over these questions. They've left the impression that somehow magical technological breakthroughs will produce clean energy that is also cheap. Perhaps that will happen; it hasn't yet. They've talked so often about the need to control wasteful health spending that they've implied they've actually found a way of doing so. Perhaps they will, but they haven't yet.

I always wonder how many of those who euphorically supported and voted for Obama are paying any sort of attention to what he's doing now.

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