Only two people have commented on this blog since I began writing it, and both times they were in tune. In tune not only with me, but probably with most everybody else reading and writing on the site. A few days ago though a friend emailed me a response to the blog from a friend of hers - Monica - and right now while our Obama waits to take over is the time to deal with it.
Monica lives in New York, and doesn’t disapprove of Obama. She probably would be one of the 78 percent approving – if she answered the pollster’s questions, and she might not. Her attitude is aligned with many Americans who think it doesn’t make much difference who’s president. Their lives will be unaffected. So why not vote for the guy Joe Six-pack wants to have a beer with? This sentiment resulted in the runaway train wreck of the Bush years, and if we’re not careful will curtail the Obama possibilities. My guess is that even many of people who voted for Obama share her point of view. It sounds intelligent and rational.
First, her commentsl:
“Below is a reply I was formulating regarding your friends blog on Obama. I didn't finish it, but I can't think anymore.
Even in Sydney there were expatriates from the US because of Bush. Sean said he came to Australia after Kerry lost to Bush. He just had to "get away". But I don't think anyone really knows how to manage a nation’s economy. It's intricate and interdependent and it comes down to the consumer in the end. Every democratic nation is that way. Sure, some nations have policies that by themselves sound great (like health care in Switzerland), but when you step back and look at the larger picture (over-worked and under-paid doctors that want to leave; short medical staff equating long waiting lines) it doesn't look like the solution to the problem. People like the idea of minimal government intervention in business and it's great for a country's economic growth where businesses can monopolize and mass produce(Starbucks, Barnes & Nobel, McDonalds), but that can also cause greed, over-production and wealthy businesses that can buy politicians that will give them tax-breaks, tax-credits. Compare that to a country with over-regulation like India. Businesses had to wait forever to get state approval to start a business, and then they get over taxed where the employer ends up making less than the employee. Anyone with average intelligence could see that the housing-market boom was a scam. What determines how a house should be valued at? Aside from the appliances, the materials cost to build the house, it's what the house next door is selling including the value someone places on it. Who determines this value? The consumer. No one wanted to intervene because that's business. Let business take care of itself.”
Okay, not that offensive, right? More neutral, almost legitimate? But isn’t this the problem? The “yawn” constituency. The close to a majority of Americans who think, “Whatever,” are the ones who will hold us back. It’s time to pull together, not just secretly hope something might improve.
So my response:
First, sure, managing most anything is complicated, and a nation’s economy – especially the U.S.’s – is complicated and difficult. But when you put people in charge who don’t believe in the task it’s far beyond difficult; it’s doomed. This defines the Bush years. The people who are running the show ideologically don’t believe in government, and if they did, many are too incompetent to function effectively. Saying no one knows how, just encourages and excuses failure.
Heath care in Switzerland? How about in every first world country? (Except the U.S., of course.) Every single country spends less per capita and by any measure gets more for their money than the U.S. does. This isn’t opinion – as is hers about Switzerland – this is true.
Doctors, insurance companies, HMO’s, the drug industry have all conspired for various reasons to provide inferior service at higher prices. And in one way or another have paid off government officials to keep it this way.
Overworked doctors, long lines, short medical staff? Sounds like she had a bad experience in Switzerland. I do know first hand that Canadians, Brits, and the French are very happy with their health care, and many studies extoll the virtues of the Swiss system. Monica might ask what nurses think about healthcare in the hospital closest to her in New York. It won’t be good and these are people in the trenches.
Saying what people want is usually reflective of personal beliefs. Monica says people don’t want government oversight. Monica I suppose doesn't but I wonder about the rest of us. Certainly having the “right” amount of government oversight is an ongoing process but the hands off approach will never work. Ask Alan Greenspan what he thinks now in retrospect about unregulated markets.
Sure it takes too long to start a new business in India, here in Brazil too. We need to improve.
But to say that employees make more than their employers is silly. I know more about Brazil, but also know something about India. In both countries, it’s all about unreported income. Employees’’ income is almost always reported. Employers on the other hand often do not report their full income. If you are in a business of some kind that has government oversight, maybe then you report all (or pay off a government official or two), but offhand I don’t know of such a business. Such a Brazilian business or Indian business, I mean.
Probably the most accurate reporting of all business in these two countries are foreign corporations. The U.S., for example makes it a felony for its corporations to evade income tax or bribe public officials in foreign countries. I doubt much enforcement took place during the Bush years, but this too should change. And will, I believe.
About her comments on the economics of Starbucks and Barnes and Noble, she needs to understand that they are subject to the same economic forces as other businesses, and that monopolies are illegal (it's just the definition that shifted during Bush). Starbucks closed 150 stores last week, yet they almost always beat the competition. In everything but price usually.
However, when an independent takes them on in terms of a cool designed place, competent and friendly employees, and a great product, the independent often wins. Sometimes they even charge more too! Sure many fave hole in the wall coffee houses bit the dust during Starbucks' acendancy, including the one around the corner from me in Santa Monica where I used to live. It was my fault too. I just decided that being ignored by the help, and the place smelling like vomit were big reasons for going to the Starbucks next door.
Barnes and Noble are in a huge fight with Amazon and many other internet book sellers. Their world has changed. In addition, public libraries now see them as the enemy. Newly remolded libraries all around the U.S. now look like Barnes and Noble, only cooler. And mostly free! This is the world of business and has nothing to do with government regulation.
Insofar as Monica’s comments about the housing market, she’s talking about one little part of the problem: the appraisal. So let’s deal with it. The appraisal is in fact supposed to be based on what similar houses in the same or similar neighborhood sell for. This is not corrupt. The corruption comes from the idea that the appraisal is part of a process of selling people houses they cannot afford. For example, I want to buy a house that costs one million dollars, but I can’t afford it. So the real estate agent who knows that I can’t afford it “works” the appraiser to value the house at say two million. Then the agent can (sort of legitimately) tell the bank or mortgage company that if the buyer defaults they can always foreclose and clear a fast million in profit. Now this is corrupt. It didn’t happen in all cases, but some.
How do they sleep at night? Here’s how: the agent and even the bank in on this scam tell themselves that the housing market will always go up. And the buyer will always earn ever more income to one day soon be able to afford the mortgage payment, and in the meantime structure the repayment schedule to relect this. BUT WHAT IF THE HOUSING MARKET GOES DOWN, AND THE BUYER’S INCOME DOES TOO? This is happening now, and is one of the many things that happened. Is it corrupt? Yes, to value a house based on anything other than comparative worth is corrupt. Appraisals however are a tip of the iceberg of the housing crises. Greedheads on Wall Street pushing credit default swaps and other nonsense dirivative products dwarf this problem.
Mostly what I disagree with is Monica's attitude. “This is just the way things are and will always be, so just get over it,” she seems to be saying. Bush has wrecked the world economy and is a mass murderer. People have lost their jobs, houses, life savings, and self respect. Others are dead, leaving grieving and impoverished families. He has done this with a combination of ideological wrongheadedness and stupidity. But at least I wasn’t there in the U.S. every day to listen to people who think much like Monica.
Last, let’s talk about something not commented on by your friend: world peace. To say world peace is unattainable makes it so. And pisses Obama off.
Let there be peace.
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