October 25, 2012

Bankruptcy of existing policies

Did Economists Doom Obama's Presidency?  by Samuel Staley

If President Obama loses the election in November, economists may well end up taking a share of the blame - for good reason. Their models misled him into applying ambitious stimulus therapies to jump start the economy and boost employment that haven't worked, vastly undermining his re-election prospects.
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In short, in what is perhaps the most important exercise in economic policy modeling since the Great Depression, two of the nation's foremost economists failed. And the failure was an epic one. They predicted that unemployment would peak at 8 percent after the stimulus. In fact it peaked at 9.9 percent. So it's unclear whether trillions of dollars of stimulus spending bought the country any reduction in unemployment whatsoever. It's also hard to escape the conclusion that it would have been better to do nothing and let the economy run its course.   Indeed, this failure is particularly notable because Romer and Bernstein's effort was well within accepted mainstream practice of the profession, not an exception.

Walter Russell Mead, "The overwhelming policy failures of modern American liberalism are undermining the basic viability of three of our greatest states"

Three states form the base of Democratic political power in the United States: California, New York and Illinois. All three states are locked in an accelerating economic, demographic and social decline; all three hope that they can stave off looming disaster at home by exporting the policies that have ruined them to the rest of the country.

Mary Williams Walsh, a talented reporter who is doing much to sustain the luster of the New York Times brand these days, has a must-read piece on the mess that is Illinois, and it is a compelling description of the misery and ruin that well-intentioned liberals combined with aggressive public sector labor unions inflict on the poor they ostensibly want to serve.

Narcissism, Consumerism And The End Of Growth  using Japan as the "bellwether of economic stagnation and social recession.

What we're seeing in Japan is the confluence of three dynamics: definancialization, the demise of growth-positive demographics and the devolution of the consumerist model of endless "demand" and "growth."  Japan is the leading-edge of the crumbling model of advanced neoliberal capitalism: that consumerist excess creates wealth, prosperity and happiness.

What consumerist excess actually creates is alienation, social atomization, narcissism, and a profound contradiction at the heart of the consumerist-dependent model of "growth": the narcissism that powers consumerist lust and identity is at odds with the demands of the workplace that generates the income needed to consume.
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Narcissism is the result of the consumerist society's relentless focus on the essential project of consumerism, which is "the only self that is real is the self that is purchased and projected."….[According to Christopher Lasch] the ontological essence of narcissism: a fear of the emptiness that lies at the very core of consumerism.
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"Personal gratification" is the driver of narcissism and consumerism, which are two sides of the same coin. Consumerist marketing glorifies the "projected self" as the "true self," encouraging self-absorption even as it erodes authentic identity, self-esteem and the resilience which enables emotional growth--the essential characteristic of adulthood.  Personal gratification is of a piece with self-absorption, fragile self-esteem and an identity that is overly dependent on consumerist signifiers and the approval of others.
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The ultimate contradiction in this debt-consumption version of capitalism is this: how can an economy have "endless expansion and growth" when pay and opportunities for secure, high-paying jobs are both relentlessly declining? It cannot.  Financialization, consumerist narcissism and the end of growth are inextricably linked.
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We need a third way that offers people work, resilience and authentic meaning. In my view, that cannot come from the Central State or the global corporate workplace: it can only come from a relocalized economy in revitalized communities

Posted by Jill Fallon at October 25, 2012 1:33 PM | Permalink