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Endgame?

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The endgame is approaching. The truth about Trump is being revealed. After disastrous midterm elections he is weak and has the stench of a loser attached to him. The most recent revelations are going to be the the last straw, and his part will finally abandon him. This week showed us why.

Of course, this has nothing to do with what’s been said in court. Nevermind that his longtime lawyer has completely turned on him, or the man who buried his secrets for decades. The Republican Party doesn’t care about illegal activities now any more than they did before the election – when it was just about as obvious as it is today, as chronicled here.

It’s the steep decline in the stock market that is the unforgivable sin.

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A Model for Federal Equity, not Debt

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Given that the stock market appears to finally be taking a pause after a decade long run, this may seem like a terrible time to talk about subtleties like debt versus equity or how to finance federal debt. Yet this is exactly the time when something like what is proposed here would be useful for the government and investors alike.

Our national debt is financed through a complex system with fixed interest and market trading which is cumbersome and difficult. Worse, it ties the government down to fixed costs which are currently taking up 329B$ per year in interest payments, nearly $3,000 per household.

In short, there has to be a better way to manage the 21T$ or so of debt. Step one would be not creating more, but here is a plan for managing the potentially crippling debt we already have.

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GM & the National Industrial Model

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The layoff notices came right after Thanksgiving. GM, a symbol of American industry, was going to close four US plants and can over 14,000 workers. Despite the relatively low numbers of people involved, the symbolic value is tremendous. The company was once the symbol of American manufacturing might. Besides, after a bankruptcy and government bailout the company surely has had what it needs to bounce back, right?

Yet there is much more to the story than this. Automobile manufacturing is in a period of massive, completely disruptive change. GM has been in trouble for a very long time simply because it cannot possibly change, and there are reasons to believe that everything is only going to be worse.

Mary Barra, the CEO of GM, has been trying to explain the situation to members of Congress this week. It’s unlikely that she can, especially since the very fact that she is obliged to do so points to the real problem. The national industrial model is dead, and it is being replaced with a global market model. GM’s problem is that it simply has not adapted to this reality in any important way.

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Knowledge Economy, Connected Economy

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This piece is a re-run from over nine years ago, but it has been fleshed out considerably as People’s Economics.  The topic at hand is 52 years old, so none of this is new.  And yet we still aren’t exactly sure as to how we need to implement this “knowledge economy” in a way that truly benefits everyone.  This was part of a series from 2009 entitled “Systemic Connections” and if you have some time the whole series is still worth a read.

The art and skill needed to put knowledge to practical use is more than just what technology is really about – it’s generally seen an increasing share of our economy.    The term “Knowledge Economy” comes from Peter Drucker in his 1966 book, “The Age of Discontinuity”.  It includes this:

“In a knowledge economy where skill is based on knowledge, and where technology and economy are likely to change fast . . . the only meaningful job security is the capacity to learn fast.”

True enough, since a lot of knowledge applied as an art went to revolutionizing economics itself since that time.  But as many of us have learned, the ability to think fast means nothing without the right connections.

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Ismism

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The suffix -ism is one of those handy things inherited from the versatile Greek language. The original usage was the creation of an active noun from a verb, such as baptism or criticism. It makes an action into a thing, allowing it to become a subject or object.

More recently, this suffix has taken on the use of defining a philosophy, often a political practice. It is a way of taking a series of beliefs or practices and putting them into a box which can be delivered as one unique practice. Far from making an active subject, in practical terms it becomes most useful as a way of preventing any action at all.

The great -isms of political economics are Socialism and Capitalism. The boxes these words describe were fixed long ago and remain rigid. Yet they retain their power to an opposing tribe and thus remain in use. It’s long past time to dump the -isms, useful as this linguistic construction once was.

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