The following pretty much sum up The Present petri dish we find ourselves in:
From Reader Comment #21
By: bjm
Washington State
June 28th, 2010
9:48 am
While optimism as opposed to fear has just as important an effect on the economy as almost any government action (A business owner told me that she has clients whose salaries were cut by 8% and then cut their owns spending by 40%), I do believe that your understanding of the day-to-day experience of people is right on.
The woman who cuts my hair and her husband who does nails put it simply when they said that they read that while they read that economy is getting better, what they see is that many people still don't have jobs. It comes down to that. Very depression-like.
Recently I rented out a house. The biggest fear people had? Is this house going to suddenly be in foreclosure or sold? I found out that many renters have had this happen and have been thrust into homelessness because they can't immediately come up with the cash to get into a different home. Very depression-like.
I had a man come knock on my door proposing a plan to do landscaping in my yard. He has lost his business and applied for dozens of jobs. Very depression-like.
I know families who are doubling up to live in the same house. There is a glut of family heirlooms for sale on ebay. The high school had a "shop" where students could choose a donated prom dress or suit instead of buying one. There are "For Lease" signs all over town where businesses once were at least making it. The local church-sponsored meal nights are overflowing. Very depression-like.
There are benefits to be sure, such as the renewed green spaces where houses were supposed to be built, and the appreciation of the small things in life. Further, the high school students I see are showing less entitlement, less pride in brand-name clothes, and more awareness of their responsibility as young adults to help their families while they secure a good education.
Still, I believe very strongly in your premise. The government's role is paramount in jump-starting the economy. Deflation makes everything worse, with property values going down, down, down as mortgage payments stay the same and credit is tighter. Very-depression-like.
A stimulus check sent out right now, this week, would send folks on that trip to visit family, send them to the store for barbecue supplies, and send them back-to-school shopping. A follow-up check in November could boost the holiday sales. How can that hurt? It just might make the difference in both the needed optimism and the increase in employment. Isn't it worth a shot?
Don't hold your breath bjm. Readers #29, 418 and 619 will probably "shoot" at something else:
TS
Hamburg
June 28th, 2010
10:33 am
I think Krugman is wrong on this one.
Debt-fueled growth of just any kind (as opposed to the kinds that are constructive and sustainable) is also a form of inflation, and it makes perfect sense to try and avoid that kind of inflation, since any nation whose people 'benefit' from that growth will also have to pay for it in the future sometime, therefore putting future generations at a disadvantage.
In the 1950s intellectuals used to worry about the environmental and human costs of democratizing very high standards of living, now people like Krugman don't seem to worry anymore, because worrying about that is not compatible with furthering the Western pipedream of 'more and more' for 'less and less'. ***
Of course, 'good growth' is possible, but only when all past debt is forgiven or repaid. Otherwise, it's the same old well-worn path to wars and political/economic domination.
Alan
Hong Kong
June 28th, 2010
1:45 pm
“On the contrary: Greece has agreed to harsh austerity, only to find its risk spreads growing ever wider.” Greece’s austerity measures fail to reassure investors because the country has acted too late to implement the measures. Hence, Europe and USA should take pre-emptive actions to reduce budget deficits before it is too late.
Ann
Denver
June 28th, 2010
2:21 pm
Americans borrow and consume. China produces and sells. China isn't experiencing a depression. They have our former jobs. We packed up our factories and shipped them to China. More government spending won't fix anything. We cannot sustain an economy based on a borrow and consume model. We have to produce and sell goods and services.
Maybe they don't realize that Reader #179 is the target:
kimberly
Iowa
June 28th, 2010
12:17 pm
I am one of the persons mentioned in the article who may never work again. Laid off in late February, I have not had a job interview since then. I am 61, and I am sure my age is against me. The other wage-earner in our family is only working very part-time. Our prospects are not bright.
Part of the problem is that educational programs and research programs in universities have been cut back. Two of us are unemployed because of financial cut-backs in education.
Some of the unemployment is "silent". For example, in the rural areas surrounding us, many are unemployed as farmers cut back on their seasonal help. Also, family members are back to working on the farms, rather than hiring day workers. Many college students cannot find summer work, including one in our family.
The result is that we are looking at bankruptcy. If this is not already a depression, I do not know what is...
My guess is that their genes really don't give a fat rat as long as their chromosomes aren't the target.
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