The First Wave Of Collateral Damage

Some of you may like this new four part series by Henry C.K. Liu at Asia Times, The Crisis of Wealth Destruction.

Been thinking about how it ties in with the idea that the people who most need money will spend it immediately, and theoretically, this is enough to keep an economy alive.

In the past, we were a nation that produced tangible and useful items that everyone needed. Then large corporations became multinationals, partly to avoid paying taxes, set up overseas sweatshops and outsourced damn near everything.

As a result, it's been decades since we've been a productive nation that makes a variety of things that other nations might actually want.





In a deep recession, the low wage worker wouldn't be saving a dime. They'd be producing needed goods, and in turn, spend their earnings immediately. This would stimulate the economy. Worked in the past, right?

Not so much now. Since we produce little of value, restoring easy credit and creating more "jobs", (like services, food, and shuffling paperwork in a cubicle) is a poor investment for the rest of the world.

"We'll give you our paper dollars in exchange
for oil, steel, designer clothes, and other tangible goods."

That's become laughable. Even as we devolved further into a Service Nation, we continued to dominate other nations via war or coercion masked as diplomacy. We have the nukes, most of them don't, so the multinationals are hitting us where our wallets are to stop us. We've hit the crossroads where we need them more for their tangible goods than they need us for our "services". They got their own service people.

On the home front, stimulating the economy would at least keep it crawling, and at best, restore it - so we can continue with our Super Power status by flipping burgers, ringing up cash registers, and chatting by the office water cooler.

It's going to take the unspeakable to pull the economy out of its coma, and being a Service Nation ain't impressing nobody. Those days are long gone.

This is one reason why the problems of the unemployed, the new poor and old poor have been written off. Along with other upcoming victims of this Great Depression II, this group of Americans are clearly viewed as collateral damage. Our increasing supply far exceeds our demand, and both the GOP and the Dems know this.

Not good, considering that we're broke, and all that's left to get will be gotten from the spoils of war.

Can you hear the softly beating sound of the war drums?

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Addendum, late 4/14/ 2010

I posted this originally at Jay Midnight's a new blog, Thought Swirl on yesterday morning. In case you missed it there, I'm adding it here.