TBO.com - TBO is Tampa Bay Online

Hernando Today

We're Economic Ostriches

ADVERTISEMENT

JOHN NASH

Of Cabbages and Kings

Published: February 13, 2009

When it comes to accepting fact; when we're facing inconvenient truths (Al's "global warming" isn't one of those) and/or when we are up against potentially unpleasant choices, we "Americans" too often burrow our heads in the sand (if we can't see it, it isn't there), which is precisely what we're doing in the face of the looming economic depression.

Columnist Robert Samuelson of the Washington Post Writers Group — one of the more sensible journalists associated with that painfully liberal rag — recently opined that there are three reasons our economy is in such trouble. As he apparently sees it: Consumers aren't spending enough; they can't get the loans and credit they need; and we're importing more than we're exporting.

He's almost right, in a third of his premise, but largely mistaken in most of the rest. There is but one fundamental reason why our economy is on the skids, but we almost never discuss that. Until we do — until we bite the bullet — we will not set the stage for long-term recovery.

We desperately need a national emphasis on production of things, rather than the provision of services. A nation's economic strength depends substantially upon producing (i.e., not importing) as much of what it needs as may be possible, given limitations of natural resources, such as minerals. We "need" wheat, corn, milk, meat, shoes, cars, tractors, ships, medicines, trains, lumber, oil, coal, steel, copper, stoves, refrigerators, aircraft, military equipment, homes and more. We do not "need" French wine, crawfish from China, scallops from Central America, shoes from Italy, automobiles from Germany, cotton from Egypt, crystal from Sweden, cell phones from Denmark, English dishes nor Japanese television receivers. And we clearly don't need another lawyer, consultant, personal trainer, financial adviser, entertainer, business manager, politician, professional (i.e., mercenary) athlete or other person taking the easy, non-productive road in non-essential services.

Filling our real needs depends upon a trained and capable work force, which we are far from having available today. By most reliable estimates, 70 percent of our workers are employed in services, while a dangerously small 30 percent work to produce things. That is upside down: Those figures should be — must be! — reversed, if this nation is to have hope of pulling itself out of the looming depression.

Unfortunately, even if we begin today to build up our productive forces, it may be a decade before we begin to see the positive results of such, a generation until we could actually be recovered from the hole we've dug for ourselves over the past 50 years. Our government will have to take seemingly drastic measures to turn young persons away from the currently more-attractive services sector and steer them towards careers in production.

Government could, for example, make available very inexpensive education in hard-core engineering and science majors. (We'd need to carefully define "engineering" and "science." "Traffic engineering" is not engineering, nor is "political science" science.) Government would have to remove subsidies and scholarships available for students choosing law, journalism, marketing, sports, advertising, communications, management, accounting, banking, etc.

At the same time, our media, parents and schools would have to join together to work to channel children into jobs associated directly with production. That means that technical schools would be favored over community colleges and that a majority of persons entering the work force would not have, nor need, a college education. The farmer that produces our food doesn't need a college degree to do his demanding and vital work nor does the important steel worker producing ships and trains.

President Barack Obama's promise of "affordable college education for everyone" couldn't be more destructive to this nation's economic health. Somehow, we've become convinced that every child should go directly from high school to college. That's not only fundamentally wrong, it's downright dangerous! If you want to see your grandchildren in an economically sound United States, then start working actively to educate a generation that is devoted to production — to work, which must become desirable — not something to be avoided.

No, we don't need to try to stimulate consumer spending, as Mr. Samuelson seems to believe. Too much of that is a large part of the reason we're in the increasing recession that worries us today. Yes, if we consumers pull back on our spending — especially for non-essentials — there'll likely be a protracted period of economic recession. But if we, on the other hand, again have easy access to easy credit and return to our hedonistic, unrealistic lifestyles, based more upon possession of things than on any other factor, we are guaranteed to fall deeper and deeper into an economic pit, from which there may be no escape.

Mr. Samuelson also points out that a "trade crisis" is part of our economic troubles (e.g., we import far more than we export). That trade crisis results not only from buying luxury items from foreign nations, but from depending on others for things we need and once produced ourselves. For example, we buy steel from the Orient, and pay to have it shipped thousands of miles across the Pacific Ocean, using ships made in other nations and operated by others. Of course, we're aware that we buy most of our oil from other nations (and also move that in foreign-owned, foreign-built and foreign-operated ships), even though we have large, untapped oil resources in places such as Alaska and the Gulf of Mexico. That trade crisis is more a result of our not producing things, than of our profligate spending for non-essentials.

Bottom line: To pull ourselves up and out of the sucking economic quicksand that now drags at out legs, we need to work, as fast as may be possible, to turn our work force from one based on services to one that produces necessary things that we can use here at home and sell to others.

At the same time, we must avoid using easy credit, if and when it again becomes available. Most importantly, we must live well within a budget that provides for significant personal savings, kept in a bank, so that they can lend it to responsible borrowers, such as farmers.

That's not what you may have heard or read elsewhere, but it's what you need to know.

Of Cabbages and Kings is a regular feature of Hernando Today.

Share this:

Loading Comments...

Email Print

ADVERTISEMENT