kunosoura
Oklahoma
Well, this goes back to the Fractional Orbit System where nuclear bombs were carried in low orbit & could strike within as little as 30 minutes. It is the old Teller (& Reagan) "Star Wars" hoax of intercept of ICBMs (we at Los Alamos "fell out of our chairs laughing" about that). And all the minuteman missiles they shout out of Vandemberg, they never hit even one at Kwajalein Isl. And then Russia was going to accept nuclear weapons in stationary orbit above them ? Are you crazy ! Even their old obsolete rockets could take them out on direct assent. As a fact, we in Intelligence had plenty of warning if we were heading into a situation of strategic nuclear war. We monitored everything about Russia, movements of key personnel, radio transmissions, launch sites. There could be no surprises. Now, the concept of near immediate attack without warning has returned. This can create extreme danger, i.e., you can't "wait" to be sure you aren't under attack- so you have no choice but to immediately launch counter attack. For those of us that lived thru that era it is life "on the razor's edge". The continual production of ever more destructive & hugely costly weapon system is what Pres. Eisenhower warned about - the Military-Industrial Complex. No empire, country, society, much less democracy in all world history ever survived militarism. Not Rome, not us, spelled "U.S." . The American people had better get their wits together, stop listening to all this controlled-media TV , newspaper, radio hate mongering, war mongering. Hello America, if you want to survive, if that yet be possible, you'd better step back and take a close look at what's going on. I'm retired engineer, mathematician - went to Los Alamos from Grad School. There's little significant I do not know about nuclear weapons or reactors. Little you hear/seen in U.S. "news" is true.
Prentizzo
Portland ME
It is both dangerous and worrisome that the US is developing technologies to increase strike speed. With the shorter time gap between strikes, down goes the time that leaders have to consider their options of confrontation (armed or not). Our military leaders have more reason to tempt themselves with the foolish idea that a fast, preemptive strike can effectively defuse a (potential) war, when it is not even clear that armed confrontation is inevitable.
In 1914, Germany preemptively bombed Belgium and declared war on France with the assumption that a fast and effective strike would make for a short war. Because of this, they didn't even wait to see if France would side with their ally Russia and declare war (and Russia hadn't even declared war yet, but only mobilized their troops, fearing Germany would give military support Austria, as it went to war with their ally, Serbia ... ). This fatal assumption started WWI, which was not a short war at all, but a stalemate turned battle of attrition -- one of the bloodiest and baseless ones in history. What's more, it's unclear whether it needed to happen at all, because it arose out of misunderstandings and assumptions which prompted preemptive strikes. And that was when it took a few days to mobilize a strike -- soon it will only take an hour!
Furthermore, the fact that these are non-nuclear weapons is likely to make it more appealing to use them, and the military could argue that these weapons are more acceptable to use than nukes, and this makes it less likely for the US to think twice about it. Yet, if they have the same destructive power -- at least on initial impact -- what's the difference?
Great. So now we have a weapon just as destructive as a nuke, but with more ease of use and speed of attack. Oh, and just wait until other emerging military nations catch on -- and they will, it can be assured. Then the whole world might as well be as war-ready and close-proximity as the DMZ. Only the slightest misunderstanding and -- boom! World War III? I hope I'm being hyperbolic.
Maximus
The United States
Here, let me offer a general piece of advice:
Russia and China are our military strategic competitors. We can pretend that they are not if we like; we can cloak the fact that they are in good words and bilateral cultural exchanges; we can even just ignore it. But, at the end of the day, the are our military strategic competitors.
Okay, next point: any time we develop a powerful or effective weapons system, our military strategic competitors are going to be unhappy. If they think they can use public opinion to decrease the likelihood that that weapon system will be deployed, then they will use public opinion. If they think otherwise, then they'll just go quietly on their way and begin plans to develop a means to counter the given weapon system.
In short, welcome to the world of realpolitik. This is not going away folks. If anything, with the relative rise of China, this sort of news will increase. We have a national security responsibility to continue to develop these systems, at least until the blissful day when we are all part of a one world regime of peace and love and flowers. And our strategic competitors will respond by complaining. Do not be surprised by this.
14.4.10
the EU has blown past us in every way
Rob
Tucson AZ formerly of NYC
The Americans who comment negatively are ill informed, too young to have the clout that their "degrees" would allow them to have, and are probably not well traveled. I did a year in France, my junior year in high school, in 1972. At that time, the bulk of Europeans did not use tissues for nose blowing, nor have a clue about toilet paper. Yet, in the past 35+ years, the EU has blown past us in every way: from their quality of life, the quality of their appliances, the efficiency of power generation and usage, to the little things like health care, cell phone rules, free broadband provided by municipalities, food pricing and minimum wage issues.
What ever gives us the idea that we're so exceptional??? Is it the incredible corp spending on elections and advertising; is it the fact that the bulk of our national "legislators" wouldn't know a true piece of legislation if it bit them? After all, they are so busy raising cash and promising things to donors, that they have barely post-college kids, with zero experience at life, but lots of experience with churches and doctrine, who read the bills for them and comment. Consequently, we have laws created by true believers [for whom obedience to something is mandatory for life satisfaction; because it's the next life that counts, not this one], a clear minority, regulating the rest of us. Often against our collective self interest.
Trash to energy isn't hitting it big here, because the enviro group, of which I consider myself a "member" is controlled by a small vocal monied few. They get tiny concessions from the dominant industry, oil & coal, call it success and rail like lunatics against the better technologies to maintain a slightly "cleaner" status quo. The day we either expand the number of legislators, redraw districts correctly, or simply mature a bit will be the day that things will actually change.
Needless to say, I don't see it happening in my lifetime in this country. Therefore, I am moving to Europe to spend my last 15 or so years w/o strife and turmoil that exists in the states.
Travel is broadening; more US citizens should try it before making pronouncements that are so absurd as to make the bulk of us sound like blithering idiots.
Tucson AZ formerly of NYC
The Americans who comment negatively are ill informed, too young to have the clout that their "degrees" would allow them to have, and are probably not well traveled. I did a year in France, my junior year in high school, in 1972. At that time, the bulk of Europeans did not use tissues for nose blowing, nor have a clue about toilet paper. Yet, in the past 35+ years, the EU has blown past us in every way: from their quality of life, the quality of their appliances, the efficiency of power generation and usage, to the little things like health care, cell phone rules, free broadband provided by municipalities, food pricing and minimum wage issues.
What ever gives us the idea that we're so exceptional??? Is it the incredible corp spending on elections and advertising; is it the fact that the bulk of our national "legislators" wouldn't know a true piece of legislation if it bit them? After all, they are so busy raising cash and promising things to donors, that they have barely post-college kids, with zero experience at life, but lots of experience with churches and doctrine, who read the bills for them and comment. Consequently, we have laws created by true believers [for whom obedience to something is mandatory for life satisfaction; because it's the next life that counts, not this one], a clear minority, regulating the rest of us. Often against our collective self interest.
Trash to energy isn't hitting it big here, because the enviro group, of which I consider myself a "member" is controlled by a small vocal monied few. They get tiny concessions from the dominant industry, oil & coal, call it success and rail like lunatics against the better technologies to maintain a slightly "cleaner" status quo. The day we either expand the number of legislators, redraw districts correctly, or simply mature a bit will be the day that things will actually change.
Needless to say, I don't see it happening in my lifetime in this country. Therefore, I am moving to Europe to spend my last 15 or so years w/o strife and turmoil that exists in the states.
Travel is broadening; more US citizens should try it before making pronouncements that are so absurd as to make the bulk of us sound like blithering idiots.
Rob
Tucson AZ formerly of NYC
The Americans who comment negatively are ill informed, too young to have the clout that their "degrees" would allow them to have, and are probably not well traveled. I did a year in France, my junior year in high school, in 1972. At that time, the bulk of Europeans did not use tissues for nose blowing, nor have a clue about toilet paper. Yet, in the past 35+ years, the EU has blown past us in every way: from their quality of life, the quality of their appliances, the efficiency of power generation and usage, to the little things like health care, cell phone rules, free broadband provided by municipalities, food pricing and minimum wage issues.
What ever gives us the idea that we're so exceptional??? Is it the incredible corp spending on elections and advertising; is it the fact that the bulk of our national "legislators" wouldn't know a true piece of legislation if it bit them? After all, they are so busy raising cash and promising things to donors, that they have barely post-college kids, with zero experience at life, but lots of experience with churches and doctrine, who read the bills for them and comment. Consequently, we have laws created by true believers [for whom obedience to something is mandatory for life satisfaction; because it's the next life that counts, not this one], a clear minority, regulating the rest of us. Often against our collective self interest.
Trash to energy isn't hitting it big here, because the enviro group, of which I consider myself a "member" is controlled by a small vocal monied few. They get tiny concessions from the dominant industry, oil & coal, call it success and rail like lunatics against the better technologies to maintain a slightly "cleaner" status quo. The day we either expand the number of legislators, redraw districts correctly, or simply mature a bit will be the day that things will actually change.
Needless to say, I don't see it happening in my lifetime in this country. Therefore, I am moving to Europe to spend my last 15 or so years w/o strife and turmoil that exists in the states.
Travel is broadening; more US citizens should try it before making pronouncements that are so absurd as to make the bulk of us sound like blithering idiots.
Tucson AZ formerly of NYC
The Americans who comment negatively are ill informed, too young to have the clout that their "degrees" would allow them to have, and are probably not well traveled. I did a year in France, my junior year in high school, in 1972. At that time, the bulk of Europeans did not use tissues for nose blowing, nor have a clue about toilet paper. Yet, in the past 35+ years, the EU has blown past us in every way: from their quality of life, the quality of their appliances, the efficiency of power generation and usage, to the little things like health care, cell phone rules, free broadband provided by municipalities, food pricing and minimum wage issues.
What ever gives us the idea that we're so exceptional??? Is it the incredible corp spending on elections and advertising; is it the fact that the bulk of our national "legislators" wouldn't know a true piece of legislation if it bit them? After all, they are so busy raising cash and promising things to donors, that they have barely post-college kids, with zero experience at life, but lots of experience with churches and doctrine, who read the bills for them and comment. Consequently, we have laws created by true believers [for whom obedience to something is mandatory for life satisfaction; because it's the next life that counts, not this one], a clear minority, regulating the rest of us. Often against our collective self interest.
Trash to energy isn't hitting it big here, because the enviro group, of which I consider myself a "member" is controlled by a small vocal monied few. They get tiny concessions from the dominant industry, oil & coal, call it success and rail like lunatics against the better technologies to maintain a slightly "cleaner" status quo. The day we either expand the number of legislators, redraw districts correctly, or simply mature a bit will be the day that things will actually change.
Needless to say, I don't see it happening in my lifetime in this country. Therefore, I am moving to Europe to spend my last 15 or so years w/o strife and turmoil that exists in the states.
Travel is broadening; more US citizens should try it before making pronouncements that are so absurd as to make the bulk of us sound like blithering idiots.
10.4.10
On the dumbing-down of our public discourse
JimF
Los Altos, CA
Eisenhower was the first Presidential candidate to hire a Madison Avenue advertising agency. It's great idea was to paint Adlai Stevenson as "an egghead" because he wasted far too many sentences discussing issues. Wonderful contribution to Democracy.
Used to be voters couldn't understand anything that didn't fit on a bumper-sticker. Now, with Twitter, we're up to 140 characters ! Things are improving by leaps and bounds.
Los Altos, CA
Eisenhower was the first Presidential candidate to hire a Madison Avenue advertising agency. It's great idea was to paint Adlai Stevenson as "an egghead" because he wasted far too many sentences discussing issues. Wonderful contribution to Democracy.
Used to be voters couldn't understand anything that didn't fit on a bumper-sticker. Now, with Twitter, we're up to 140 characters ! Things are improving by leaps and bounds.
9.4.10
On national level bailouts
Brian Moore
Germany
I live in Germany. The question is if Germany bails out Greece, then they will soon be bailing out other troubled economies such as Italy, Spain, etc. A Greek rescue is about as popular among Germans as the AIG, CitiBank, etc. rescues are in the US. What would be the US position if the the US had to raise taxes and go deeper into debt in order to bail out Mexico after a spending binge? It's easy for Americans to tell Germany to pay up. Maybe the US tax payers should rescue Greece instead?
Mrs. Merkel and her party need to win elections in here Germany, not Greece or in Brussels in order to remain in power. Telling German voters that their tax monies are going south so Greeks can continue to retire with full benefits at age 52 while the retirement age is being raised in Germany to 67 doesn't sit well here. Furthermore wages in Germany have declined over the last 10 years while prices have increased, so most workers are very skeptical of the benefits of the Euro.
Greece got themselves into this mess, bhe powerful money men will find a way to rescue the Greek elite at the expense of German workers and on the backs of the Greek people. At the same time, they will make a tidy profit in the transaction. The question I ask is if Germany bails out Greece, Italy, Spain, etc. who will bail out Germany when the bill comes due? Certainly not Greece.
Brian Moore
Steve
Vancouver
It was Mark Twain who said famously, "History doesn't repeat itself but it sure does rhyme a lot!"
Right now we're right about 1930-31, when a false economic dawn led governments to relax and clamp down. We're about to make the same mistake again. We forget that it was the collapse of a bank in Austria that caused the second vicious stage of the Great Depression.
Similarly, Greece seems also not to be a tipping point in terms of how it will affect the center in the US and Western Europe. Yet, every week this drags on reminds global bondholders that the US and all other westerm countries are far more indebted than they were in the 1930s. And, as Krugman points out in his post-World War II example, the US used inflation to bail its way out of heavy indebtedness. People, that's not something lenders really want to hear, especially from a country that's running trillion dollar deficits.
Ominously, the differences from the 30s are not good. Consumers, always expected to bail out the economy when interest rates are dropped, are far more indebted than back then. Businesses are far more leveraged as well. Who's left? The Chinese?
Governments are basically stalling for time in the hopes that a miracle will somehow bail us all out.
But all miracles have already been tapped and Greece is the miner's canary telling us what lies ahead. If 2008 was the hurricane, then right now we're in the calm of the storm before it hits again, this time closer to home. To paraphrase another great American writer, Ask not for whom the bell tolls, it tolls for you.
Germany
I live in Germany. The question is if Germany bails out Greece, then they will soon be bailing out other troubled economies such as Italy, Spain, etc. A Greek rescue is about as popular among Germans as the AIG, CitiBank, etc. rescues are in the US. What would be the US position if the the US had to raise taxes and go deeper into debt in order to bail out Mexico after a spending binge? It's easy for Americans to tell Germany to pay up. Maybe the US tax payers should rescue Greece instead?
Mrs. Merkel and her party need to win elections in here Germany, not Greece or in Brussels in order to remain in power. Telling German voters that their tax monies are going south so Greeks can continue to retire with full benefits at age 52 while the retirement age is being raised in Germany to 67 doesn't sit well here. Furthermore wages in Germany have declined over the last 10 years while prices have increased, so most workers are very skeptical of the benefits of the Euro.
Greece got themselves into this mess, bhe powerful money men will find a way to rescue the Greek elite at the expense of German workers and on the backs of the Greek people. At the same time, they will make a tidy profit in the transaction. The question I ask is if Germany bails out Greece, Italy, Spain, etc. who will bail out Germany when the bill comes due? Certainly not Greece.
Brian Moore
Steve
Vancouver
It was Mark Twain who said famously, "History doesn't repeat itself but it sure does rhyme a lot!"
Right now we're right about 1930-31, when a false economic dawn led governments to relax and clamp down. We're about to make the same mistake again. We forget that it was the collapse of a bank in Austria that caused the second vicious stage of the Great Depression.
Similarly, Greece seems also not to be a tipping point in terms of how it will affect the center in the US and Western Europe. Yet, every week this drags on reminds global bondholders that the US and all other westerm countries are far more indebted than they were in the 1930s. And, as Krugman points out in his post-World War II example, the US used inflation to bail its way out of heavy indebtedness. People, that's not something lenders really want to hear, especially from a country that's running trillion dollar deficits.
Ominously, the differences from the 30s are not good. Consumers, always expected to bail out the economy when interest rates are dropped, are far more indebted than back then. Businesses are far more leveraged as well. Who's left? The Chinese?
Governments are basically stalling for time in the hopes that a miracle will somehow bail us all out.
But all miracles have already been tapped and Greece is the miner's canary telling us what lies ahead. If 2008 was the hurricane, then right now we're in the calm of the storm before it hits again, this time closer to home. To paraphrase another great American writer, Ask not for whom the bell tolls, it tolls for you.
8.4.10
NYTimes' Optimism
According to FLOYD NORRIS, "Why So Glum? Numbers Point To a Recovery." He goes on to write in NYTimes, "The signs are that the U.S. economic recovery is growing stronger. So why do so many seem not to believe it?"
AnnS, from Michigan, replies:
You must stop. You really must stop comparing coconuts to rocks as if you are comparing apples to apples. The reasoning - & assertion that 'history' supports your argument - are both incorrect & false. You insist upon ONLY looking at things that have occurred within your adult lifetime & then assuming since the symptoms are the same, the illness is the same. If you took sudafed, asprin & fluids for aches, pains, a stuffy head & a fever, it worked if what you had was a cold. If the same symptoms are caused by ebola, your diagnosis based upon having had a cold before a& the same treatment will not work.
(1) This is NOT a recession caused by
(a) Production which exceeded demand - 1958 & 1991 recessions
(b) Interest rates being high AND external shocks to the economy (gas prices) - 1973 recession
(c) Interest rates jacked to astronomical levels - 1982 recession
(d) Speculative bubble that had limited impact on the real economy (dot.com crash) - 2001 recession
(2) This is a GLOBAL financial crash. This time it IS different.
In the past 200 years, there have now been 5 GLOBAL financial crashes. 3 were triggered by the outbreak of wars (Napoleonic, WWI & WWII) & ended when the wars ended. The 4th crash took 10 years to end - & was ended by WWII for the US by the vast amount of money poured into war production by the government. 2007 is the 5th.
(3) Financial crashes since WWII have been either national or regional - never global. It took an average of 4.8 years for the affected countries or regions to get back to where they had been before the crash. They did it by EXPORTING their way back to a functioning economy. One country (Japan) had a national crash but couldn't export its way out of it because now it was competing with China for the same customers.
The US has been a negative net exporter for decades. SO we are going to export what? And how are we going to export more than we import? We did export some stuff in the '00s called SIVs and CDOs and credit default swaps --- and blew up the world. Can't do that again as no one is stupid enough to buy that stuff.
Oh & the stock market is a useless indicator. Historically the equities markets (stocks) recover in 3 years from the crash.
(4) Recover based upon WHAT? Can't get by selling each other houses or junk from China anymore. Tilly & Jake out there on Main St are broke - flat tapped out & busted. There is NO MONEY to spend. Mortgage debt increased 216% from 1995. Household consumer debt (credit cards, cars etc) increased 75%. Household incomes barely increased 40%. They are DROWNING in debt they have to pay off -- and no one but no one will lend them money either with credit cards or the house ATM to go shopping.
There are 4 major drivers for an economic recovery.
(a) Consumer spending. Forget it. They are up to their eyeballs in debt & their earned incomes are falling.
(b) Residential construction. Sorry but have an excess supply of houses as it is & the prices are STILL too HIGH for the typical household with its median income of $54000.
(c) Commercial construction. Nope. We don't need more hotels, shopping centers etc. Vacancies in strip malls are the highest ever. Hotels are closing. Purchasers are walking away from underwater office buildings with 20-30% vacancies. Businesses do not need space when they don't have enough customers & the customers are history.
(d) Exporting. Export WHAT which will be more than imports?
(5) And since you haven't deigned to notice, check out the BEA income data.
(a) 2009 was only the 2nd time since WWII that total personal income FELL. Last time it happened was 1948 & it bounced back in 1949. It is not bouncing this time. The only thing keeping total personal income from falling further are the 'transfer payments' - Social Security, unemployment etc.
(b) The Wages and Salaries data is very very grim. Total wages/salaries have fallen back in total dollars to late '06/early '07 and are still falling.
(c) Proprietor's Income (what business owner's make) is worse. Total PI is back to the same amount as in 2004.
So you are shocked that people aren't all happy and giddy about Wall St? ROFLOL!! Not only are the real $$ in wages & incomes back to '04 or '06, but in the meantime there has been inflation of 15% ('04 to now) to 8% (06 to now) & the population has increased by 4-6%. They have little or no savings, incomes/wages are less and the amount of credit they are using is less.
OF COURSE they are pessimistic. They are broke. They owe mind-boggling amounts of money on their debts. They aren't making anymore than they did 4-6 years ago & in the meantime inflation has driven price up 8 -15%.
(6) Record number of long-term (6 months ++) unemployed whose profiles are educated professionals over 40.
DO have the NYT spring for a copy of "This Time Is Different: Eight Centuries of Financial Follies." You will learn something.
AnnS, from Michigan, replies:
You must stop. You really must stop comparing coconuts to rocks as if you are comparing apples to apples. The reasoning - & assertion that 'history' supports your argument - are both incorrect & false. You insist upon ONLY looking at things that have occurred within your adult lifetime & then assuming since the symptoms are the same, the illness is the same. If you took sudafed, asprin & fluids for aches, pains, a stuffy head & a fever, it worked if what you had was a cold. If the same symptoms are caused by ebola, your diagnosis based upon having had a cold before a& the same treatment will not work.
(1) This is NOT a recession caused by
(a) Production which exceeded demand - 1958 & 1991 recessions
(b) Interest rates being high AND external shocks to the economy (gas prices) - 1973 recession
(c) Interest rates jacked to astronomical levels - 1982 recession
(d) Speculative bubble that had limited impact on the real economy (dot.com crash) - 2001 recession
(2) This is a GLOBAL financial crash. This time it IS different.
In the past 200 years, there have now been 5 GLOBAL financial crashes. 3 were triggered by the outbreak of wars (Napoleonic, WWI & WWII) & ended when the wars ended. The 4th crash took 10 years to end - & was ended by WWII for the US by the vast amount of money poured into war production by the government. 2007 is the 5th.
(3) Financial crashes since WWII have been either national or regional - never global. It took an average of 4.8 years for the affected countries or regions to get back to where they had been before the crash. They did it by EXPORTING their way back to a functioning economy. One country (Japan) had a national crash but couldn't export its way out of it because now it was competing with China for the same customers.
The US has been a negative net exporter for decades. SO we are going to export what? And how are we going to export more than we import? We did export some stuff in the '00s called SIVs and CDOs and credit default swaps --- and blew up the world. Can't do that again as no one is stupid enough to buy that stuff.
Oh & the stock market is a useless indicator. Historically the equities markets (stocks) recover in 3 years from the crash.
(4) Recover based upon WHAT? Can't get by selling each other houses or junk from China anymore. Tilly & Jake out there on Main St are broke - flat tapped out & busted. There is NO MONEY to spend. Mortgage debt increased 216% from 1995. Household consumer debt (credit cards, cars etc) increased 75%. Household incomes barely increased 40%. They are DROWNING in debt they have to pay off -- and no one but no one will lend them money either with credit cards or the house ATM to go shopping.
There are 4 major drivers for an economic recovery.
(a) Consumer spending. Forget it. They are up to their eyeballs in debt & their earned incomes are falling.
(b) Residential construction. Sorry but have an excess supply of houses as it is & the prices are STILL too HIGH for the typical household with its median income of $54000.
(c) Commercial construction. Nope. We don't need more hotels, shopping centers etc. Vacancies in strip malls are the highest ever. Hotels are closing. Purchasers are walking away from underwater office buildings with 20-30% vacancies. Businesses do not need space when they don't have enough customers & the customers are history.
(d) Exporting. Export WHAT which will be more than imports?
(5) And since you haven't deigned to notice, check out the BEA income data.
(a) 2009 was only the 2nd time since WWII that total personal income FELL. Last time it happened was 1948 & it bounced back in 1949. It is not bouncing this time. The only thing keeping total personal income from falling further are the 'transfer payments' - Social Security, unemployment etc.
(b) The Wages and Salaries data is very very grim. Total wages/salaries have fallen back in total dollars to late '06/early '07 and are still falling.
(c) Proprietor's Income (what business owner's make) is worse. Total PI is back to the same amount as in 2004.
So you are shocked that people aren't all happy and giddy about Wall St? ROFLOL!! Not only are the real $$ in wages & incomes back to '04 or '06, but in the meantime there has been inflation of 15% ('04 to now) to 8% (06 to now) & the population has increased by 4-6%. They have little or no savings, incomes/wages are less and the amount of credit they are using is less.
OF COURSE they are pessimistic. They are broke. They owe mind-boggling amounts of money on their debts. They aren't making anymore than they did 4-6 years ago & in the meantime inflation has driven price up 8 -15%.
(6) Record number of long-term (6 months ++) unemployed whose profiles are educated professionals over 40.
DO have the NYT spring for a copy of "This Time Is Different: Eight Centuries of Financial Follies." You will learn something.
6.4.10
Geithner visits India, here's what China tells him
Dekoff
Shanghai
A brief look at Trade Surpluses and Deficits
INDIA
The indian rupee is one of most undervalued currencies in the world. According to the IMF, the fair value for rupee/usd would be 16:1, but it is trading at 48:1.
This means the Indian currency is 300% undervalued, but yet India has one of the worst current accounts of all major economies. India still has consistent trade deficits with the world. The cheap currency doesn't help India to produce a trade surplus.
CANADA
Since 1971 the Canadian dollar has fluctuated between US$0.66 and US$1.21, moving through that range more than once. In the past 10 years, the Canadian dollar has appreciated about 50% against the US dollar. Yet the US has had consistent trade deficits with Canada for the past 30 years, regardless of the exchange rate.
Canada's economy is largely natural-resource and export-oriented - metals, minerals, lumber, oil and gas, wheat. Canada produces many things the US needs, while the US produces few things that Canada wants.
JAPAN
Since 1960, the Japanese Yen has consistently strengthened against the US dollar, rising from 360:1. In 1985, the year of the Plaza Accord, the Yen was at 240:1. In the 3 years following, the Yen doubled in value to 120:1, and now sits at about 90:1 - and is now 30% or 40% over-valued.
But through all those years, the US consistently had increasing trade deficits with Japan, in spite of the Yen rising more than 300% in value.
Japan, like Canada, produces many things the US needs, but wants little of US production.
CHINA
For many years the RMB was firmly pegged only to the US dollar at about 8.25:1, but was released from that peg in 2005 and has since appreciated about 25%. But the US has persistent trade deficits with China - and these have markedly increased in spite of the recent 25% upward movement of the RMB.
China produces many things Americans want and need, while the US produces less of what China wants.
EUROPE
After the signing of the Plaza Accord in 1984, the major European currencies doubled against the US dollar almost immediately. But the US trade deficits persisted with most of its trading partners.
There are politicians in the US, and even in the White House, who blame China for the recent US subprime financial crisis. In their view, the crisis was caused by the Chinese 'saving too much'.
The US must stop blaming everybody else for their economic problems. The US government insistently claims that their trade deficit and economic problems are caused by China's RMB being undervalued.
In fact the US problems are entirely home-grown. America has serious structural imbalances in its economy, and no amount of messing with the exchange rates of other countries will be a cure.
China is doing all the right things by looking after its own best interests and not derailing or destroying its efforts to modernise and join the first world. It cannot let the US bully it into capitulating.
The RMB was steadily appreciating against the US$ until the meltdown, when it was forced to stop. That is not China's fault. If the US had its own house in order, the world's financial and trade systems would be orderly as well. It really is time to call a spade a spade, and stop letting the US dictate every country's economic policies.
Shanghai
A brief look at Trade Surpluses and Deficits
INDIA
The indian rupee is one of most undervalued currencies in the world. According to the IMF, the fair value for rupee/usd would be 16:1, but it is trading at 48:1.
This means the Indian currency is 300% undervalued, but yet India has one of the worst current accounts of all major economies. India still has consistent trade deficits with the world. The cheap currency doesn't help India to produce a trade surplus.
CANADA
Since 1971 the Canadian dollar has fluctuated between US$0.66 and US$1.21, moving through that range more than once. In the past 10 years, the Canadian dollar has appreciated about 50% against the US dollar. Yet the US has had consistent trade deficits with Canada for the past 30 years, regardless of the exchange rate.
Canada's economy is largely natural-resource and export-oriented - metals, minerals, lumber, oil and gas, wheat. Canada produces many things the US needs, while the US produces few things that Canada wants.
JAPAN
Since 1960, the Japanese Yen has consistently strengthened against the US dollar, rising from 360:1. In 1985, the year of the Plaza Accord, the Yen was at 240:1. In the 3 years following, the Yen doubled in value to 120:1, and now sits at about 90:1 - and is now 30% or 40% over-valued.
But through all those years, the US consistently had increasing trade deficits with Japan, in spite of the Yen rising more than 300% in value.
Japan, like Canada, produces many things the US needs, but wants little of US production.
CHINA
For many years the RMB was firmly pegged only to the US dollar at about 8.25:1, but was released from that peg in 2005 and has since appreciated about 25%. But the US has persistent trade deficits with China - and these have markedly increased in spite of the recent 25% upward movement of the RMB.
China produces many things Americans want and need, while the US produces less of what China wants.
EUROPE
After the signing of the Plaza Accord in 1984, the major European currencies doubled against the US dollar almost immediately. But the US trade deficits persisted with most of its trading partners.
There are politicians in the US, and even in the White House, who blame China for the recent US subprime financial crisis. In their view, the crisis was caused by the Chinese 'saving too much'.
The US must stop blaming everybody else for their economic problems. The US government insistently claims that their trade deficit and economic problems are caused by China's RMB being undervalued.
In fact the US problems are entirely home-grown. America has serious structural imbalances in its economy, and no amount of messing with the exchange rates of other countries will be a cure.
China is doing all the right things by looking after its own best interests and not derailing or destroying its efforts to modernise and join the first world. It cannot let the US bully it into capitulating.
The RMB was steadily appreciating against the US$ until the meltdown, when it was forced to stop. That is not China's fault. If the US had its own house in order, the world's financial and trade systems would be orderly as well. It really is time to call a spade a spade, and stop letting the US dictate every country's economic policies.
How it looks from China
chinalaowai
Shenzhen, Guangdong, China
Your editorial's jingoistic, hegemonic, unrepentant economic narcissism is typical of America's attitude to the world.
Richard Nixon could have written this editorial, prior to his unilateral abolition of the Bretton Woods system of international financial exchange, commonly known in the US as cancellation of the gold standard, and internationally as "Nixon Shock". In 1971, the cost of the Vietnam War and increased domestic spending from Johnson's Great Society programs forced America to print more money. European nations that held American paper asked for gold instead, depleting reserves, and decreasing the dollar's value. Without consulting international trading partners, Nixon removed America from the gold standard. And the world suffered: with no international standard for currencies, oil-producing nations were able to doubled their prices, causing global hyperinflation, recession, and the petrodollar.
America has once again overextended itself. And once again, America will try to convince the rest of the world to follow a policy that will lead to international economic and social disaster. America's alliances with many nations, including the two countries mentioned, Mexico and India, are strictly a political ploy to put pressure on China. If America succeeds, and China complies with America's demands, Mexico and India with find their agreements with America to be worthless - remember the failed promises of NAFTA. Ultimately they will receive nothing. Only America will benefit.
What America does not say is that China's currency policies are in line with the country's GDP and domestic growth. More importantly, the policy is an accurate reflection of China's per capita income: between US$3200-3600 in 2009, depending on the source. This is a statistic rarely cited in America's strenuous effort to force China's compliance.
Historically, America has cherry-picked policy positions based on self-interest, and manipulated other countries for national gain. The world sees this. China knows this. America's loss of influence and credibility are based on broken promises and inability to maintain a clear economic policy, both internally and externally. That China is in the ascendancy is a reality America refuses to accept.
What the world should really be concerned about is what unilateral action America may decide on this time. Will there be an "Obama Shock", similar to the Nixon Shock of 1971? Will America lead Taiwan into war with China? Will Japan be forced into a position of choosing between America and China? These are the types of policies America has historically chosen to enact, either overtly or covertly, when its power base has been threatened.
This is not the time for America to make an economic last stand. America cannot win without causing greater pain to the rest of the world.
Get out of the way and let China lead.
Shenzhen, Guangdong, China
Your editorial's jingoistic, hegemonic, unrepentant economic narcissism is typical of America's attitude to the world.
Richard Nixon could have written this editorial, prior to his unilateral abolition of the Bretton Woods system of international financial exchange, commonly known in the US as cancellation of the gold standard, and internationally as "Nixon Shock". In 1971, the cost of the Vietnam War and increased domestic spending from Johnson's Great Society programs forced America to print more money. European nations that held American paper asked for gold instead, depleting reserves, and decreasing the dollar's value. Without consulting international trading partners, Nixon removed America from the gold standard. And the world suffered: with no international standard for currencies, oil-producing nations were able to doubled their prices, causing global hyperinflation, recession, and the petrodollar.
America has once again overextended itself. And once again, America will try to convince the rest of the world to follow a policy that will lead to international economic and social disaster. America's alliances with many nations, including the two countries mentioned, Mexico and India, are strictly a political ploy to put pressure on China. If America succeeds, and China complies with America's demands, Mexico and India with find their agreements with America to be worthless - remember the failed promises of NAFTA. Ultimately they will receive nothing. Only America will benefit.
What America does not say is that China's currency policies are in line with the country's GDP and domestic growth. More importantly, the policy is an accurate reflection of China's per capita income: between US$3200-3600 in 2009, depending on the source. This is a statistic rarely cited in America's strenuous effort to force China's compliance.
Historically, America has cherry-picked policy positions based on self-interest, and manipulated other countries for national gain. The world sees this. China knows this. America's loss of influence and credibility are based on broken promises and inability to maintain a clear economic policy, both internally and externally. That China is in the ascendancy is a reality America refuses to accept.
What the world should really be concerned about is what unilateral action America may decide on this time. Will there be an "Obama Shock", similar to the Nixon Shock of 1971? Will America lead Taiwan into war with China? Will Japan be forced into a position of choosing between America and China? These are the types of policies America has historically chosen to enact, either overtly or covertly, when its power base has been threatened.
This is not the time for America to make an economic last stand. America cannot win without causing greater pain to the rest of the world.
Get out of the way and let China lead.
Do we need to look at ourselves from Belgium?
Anonymous BE
Belgium
Every time I go back to the U.S., I sense a nation in decline. It's a vague, but strong feeling. However, let's look at some facts:
1. Median income for the entire population has declined in past 10 years.
2. Median income for those without a college education (about 70% of the adult population) has declined for the past 30 years.
3. Birth rates among the white middle class are below replacement - similar to those in Europe. Nothing wrong per se with Blacks, Latinos, and the poor becoming a larger percentage of the population, except that an even larger percentage of the population will be poorer and less educated.
4. The percentage of the adult population with a university education is in decline in terms of generations - the "Baby Boomer" generation has more college graduates than the generation "X" that succeeded it. This is very negative trend for the country.
5. In a country with rapid demographic change in terms of ethnicity, there may be problems with one generation's taxes supporting an older generation's retirement, if there deep political and ethnic hostility between the dominant groups within each generation.
6. America has the highest Gini coefficient in the OECD, with the exception of Mexico, and it is getting higher. Countries with high Gini coefficients have a great deal of inequality by definition, but that inequality tends to create crime and a less-cohesive society - in short, a lower quality for everyone who cannot afford and/or does not prefer to live behind massive gates.
7. America has allowed many of its great cities to decline in a way that is unparalleled in advanced economies. The kind of decay, crime, poverty, racial segregation, gutting of manufacturing, and demographic decline seen in cities like Baltimore, Detroit, Cleveland, Philadelphia, Hartford, and so on is tragic. Why would a rich society - one with a GDP per capita in the top 10 highest in the world - allow this to happen unless there is some deep dysfunction? Go to Canada, Australia, Japan, Western Europe: you will never see cities with anything similar to the decline in many American cities. A couple that I know from Sydney, Australia, recently visited Los Angeles for the first time, and they were shocked at the level of poverty and dinginess of certain areas, and that they were not free to go to any part of the city in safety.
8. Contrary to the myth of the American dream, social mobility in the United States is actually much lower than in many advanced economies, as recent OECD studies have shown.
9. America is the only advanced economy where its citizens right to access health care is not guaranteed. Yes, this may change in 2014, but the system designed seems to still have some loopholes for companies and cracks for people to fall through. And, why is the state of health of Americans at the low end of advanced economies if America spends twice as much or more per capita compared to any other country?
10. The murder rate in the United States is about five times as high (per capita) as that of countries with similar incomes. Even more worrying: why is this not a cause for consternation in the society?
11. America has the largest prison population in the world, and it is very high in terms of per capita figures. What does this say about a society that it must lock up huge numbers of its citizens in order to function? What does it say about America if one out of nine Black men is in prison, jail, or on parole? Again, deep dysfunction that is not being addressed.
12. Tertiary education is often financially difficult to access in America, and for those not from wealth families, it means huge student loans that will mean wage slavery for most holders for the next 30 years of their lives.
13. Americans have no legal right to vacation time, sick leave, or maternity leave, unlike nearly every other country on earth (even poor ones). This makes for a family-unfriendly society, a less healthy society, and a stressed society. Only the rich and powerful would want such a society. America is no beacon of hope on this account, but rather, tragically retrograde.
And so on - these are just items that come to mind now as to why America is not such a great country in terms of quality of life, which is, in the final analysis, the only statistic that counts. Do you see evidence for a great turnaround on these negative characteristics? I don't, except perhaps for somewhat on health care. I can tell you that as long as the things above are ignored and silly cheerleading for laughable books about how great life will be 40 years into the future, I am not optimistic.
Belgium
Every time I go back to the U.S., I sense a nation in decline. It's a vague, but strong feeling. However, let's look at some facts:
1. Median income for the entire population has declined in past 10 years.
2. Median income for those without a college education (about 70% of the adult population) has declined for the past 30 years.
3. Birth rates among the white middle class are below replacement - similar to those in Europe. Nothing wrong per se with Blacks, Latinos, and the poor becoming a larger percentage of the population, except that an even larger percentage of the population will be poorer and less educated.
4. The percentage of the adult population with a university education is in decline in terms of generations - the "Baby Boomer" generation has more college graduates than the generation "X" that succeeded it. This is very negative trend for the country.
5. In a country with rapid demographic change in terms of ethnicity, there may be problems with one generation's taxes supporting an older generation's retirement, if there deep political and ethnic hostility between the dominant groups within each generation.
6. America has the highest Gini coefficient in the OECD, with the exception of Mexico, and it is getting higher. Countries with high Gini coefficients have a great deal of inequality by definition, but that inequality tends to create crime and a less-cohesive society - in short, a lower quality for everyone who cannot afford and/or does not prefer to live behind massive gates.
7. America has allowed many of its great cities to decline in a way that is unparalleled in advanced economies. The kind of decay, crime, poverty, racial segregation, gutting of manufacturing, and demographic decline seen in cities like Baltimore, Detroit, Cleveland, Philadelphia, Hartford, and so on is tragic. Why would a rich society - one with a GDP per capita in the top 10 highest in the world - allow this to happen unless there is some deep dysfunction? Go to Canada, Australia, Japan, Western Europe: you will never see cities with anything similar to the decline in many American cities. A couple that I know from Sydney, Australia, recently visited Los Angeles for the first time, and they were shocked at the level of poverty and dinginess of certain areas, and that they were not free to go to any part of the city in safety.
8. Contrary to the myth of the American dream, social mobility in the United States is actually much lower than in many advanced economies, as recent OECD studies have shown.
9. America is the only advanced economy where its citizens right to access health care is not guaranteed. Yes, this may change in 2014, but the system designed seems to still have some loopholes for companies and cracks for people to fall through. And, why is the state of health of Americans at the low end of advanced economies if America spends twice as much or more per capita compared to any other country?
10. The murder rate in the United States is about five times as high (per capita) as that of countries with similar incomes. Even more worrying: why is this not a cause for consternation in the society?
11. America has the largest prison population in the world, and it is very high in terms of per capita figures. What does this say about a society that it must lock up huge numbers of its citizens in order to function? What does it say about America if one out of nine Black men is in prison, jail, or on parole? Again, deep dysfunction that is not being addressed.
12. Tertiary education is often financially difficult to access in America, and for those not from wealth families, it means huge student loans that will mean wage slavery for most holders for the next 30 years of their lives.
13. Americans have no legal right to vacation time, sick leave, or maternity leave, unlike nearly every other country on earth (even poor ones). This makes for a family-unfriendly society, a less healthy society, and a stressed society. Only the rich and powerful would want such a society. America is no beacon of hope on this account, but rather, tragically retrograde.
And so on - these are just items that come to mind now as to why America is not such a great country in terms of quality of life, which is, in the final analysis, the only statistic that counts. Do you see evidence for a great turnaround on these negative characteristics? I don't, except perhaps for somewhat on health care. I can tell you that as long as the things above are ignored and silly cheerleading for laughable books about how great life will be 40 years into the future, I am not optimistic.
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