What do you think?

I was thinking to myself yesterday, as I checked in on the news about the potential bailout...err credit availability and liquidity security measures (my words, not theirs.) that are pending approval of the Congress currently, what would happen if they didn't bail them out?

Let me first say that this is a thought process, not an opinion piece. I haven't made up my mind on this whole thing yet, whether I think it's a good idea or not that is. My first instinct tells me to say no, don't do it. I believe in the power of the free-market and that it can correct itself and fill a vacuum when it exists. If a business doesn't manage itself well or provide a product that is in demand, it goes away. But can a single industry be so integral to a nation's survival that allowing it to dissolve would surely doom the nation itself to mass economic suffering or would it's failure merely set the nation on a new and different path - one that could benefit it in the long run?

As I said, I don't have the answers, I won't even pretend that I do, but I do have some ideas that I'm trying to weigh as I come to grips with things. For instance, let's say the big 3 don't get the billions they are asking for. Now we have potentially a million people out of work, what do they do? What did people in that part of the country do before cars came along? Could they potentially fill the labor shortage we keep hearing about? You know, the one that warrants all of the undocumented laborers coming into the country because "no-one else will do these jobs." Maybe. And maybe with that kind of mass labor pool available to us, we could start to get some of our farms in that part of the world producing actual food, since one of the big arguments against sustainable agriculture is that it takes too much labor to do.

But would they be able to live in such a way? Are we headed for a deflationary spiral, that's what the Great Depression was thought of as, where the cost of goods will "reset" itself to a low enough level that a person could live respectably on less? Or perhaps the changes and challenges facing us will bring us through to a new place, where we don't think we need as much to feel like we're living respectably?

Another thought, the one that really ruffles my feathers, is that even though I, as previously mentioned, believe in the free-market I don't know how long I can continue it? Is it still free? I mean have we gotten to a point where politicians need so much money to get into position that the only way they can get it is by getting in bed with big corporations which by default makes them beholden to them later? How skewed are the rules when the bigger a corporation is, the more it is potentially able to get bailed out by the gov? Mom and pop don't get bailed out if they can't compete with Big box "X". How is that free market?

What's your opinion of these bailouts, both past and potential? I'm still agnostic on them. There's too much to take into consideration. I guess I'm just glad to have a good job, and to have a great bunch of "sounding boards" like you all out there...

I guess I've rambled on enough for one night... till next time.

* * * NEWSFLASH * * *

Get this... We're in a recession ! ! !

OK, OK, I know I'm not breaking any big surprises to anyone today but yes, in case you haven't heard, Yesterday the National Bureau of Economic Research officially declared us as having been in a recession since December 2007, and as if to dot the i's and cross the proverbial t's, the Stock market tanked today to the tune of 679.95 pts (7.70%). I'm not an economist, nor am I any matter of expert on these things, but it seems to me that the times aren't necessarily getting a lot smoother.

I thought I'd share a very good read that I found today. Many of you may have already read it, but I thought it was worth the read anyway.

Why I'm not worried about inflation, at least for a good while yet
~Sharon Astyk

I have to wonder at these times what kind of different things we should be doing, we of course meaning the "powers that be", that we're not doing. during the Depression of the thirties, they encountered problems that never could have been foreseen previous to that time. What are the glitches in the current methodology that we can't see coming? Oil, energy, food security? A failure in any one of those could be catastrophic I fear. I know a lot of folks out there think people like my wife and I are a bit "extravagant" or "eccentric" in our desire to produce food, and to simplify the way we do things day to day but you know what, I'll keep trying to share my ideas with them nonetheless. I guess I'm just an idealist in that way. I believe that knowledge is power, and I'm willing to share what I know liberally.

Hmmm, this has turned out to be a bit of a rambler of a post hasn't it? I guess I can't be brilliant and witty all the time huh?
In the event that you want to read a few more coherent sentences from me, I just posted a couple of new entries on my other venues today too.
Check them out:

Grit Magazine User blogs: HERE
Simple Green Frugal Blog: HERE

Till tomorrow.
P~

End of Consumerism?

As I listened to Talk of the Nation this evening, I heard an interesting notion being thrown out there, that we may be seeing the end of “The age of consumerism”. Really? Have we really gotten to that point? I’ve talked many times about reducing consumption, and I do truly believe that somewhere therein lays our future economic model. A lot of people – bloggers, pundits, activists and ordinary folks alike – are out there touting the benefits of abandoning our consumerist ways. Back to the land, simple living, DIY’ers or whatever the reason, there is one thing that we need to keep in mind. Whether or not we like it, we need an economy in this world. If it should it be a global or a local one I don’t pretend to know, but it will mean that we are consumers to some point. Some kind of goods or services will be exchanged. As I said, I’ve talked about this before, and I stand by my general belief that we need to reduce what we consume. I don’t, however, think that we should try to eliminate consumption, or should hold as the ultimate goal, for that matter, the elimination of consumption. But I do think that we should take a look closely at how we’ve been doing it.

As I see it, the conundrum with the whole consumerist - vs. - non-consumerist argument is that the conventional wisdom holds that economic growth is the solution to our economic problems, and that more buying is at the root of our economy. Buy more…better economy…where’s the argument right? More people buy stuff, which means more money is floating around, which means that more people get hired to service the buyers, which puts more money back into the system; it’s trickle-down economics at its core. Well the argument is valid if we take it at face value, but we aren’t are we. We’re not actually buying things when we’re out shopping. Alright some of us are, but most folks have been out there charging it or financing it. Don’t mistake that for buying, it is not the same thing. It’s merely a promise to buy something a little at a time. If that person and oh…200,000 or so friends of his… default on their loans, debts, credit cards, homes and whatever else, the manufacturers are left holding the bag. They can’t then pay their debtors, who in return say “Screw this!! I’m just gonna hold on to my money before I lose more!” And then you reach the point at which we find ourselves today don’t you? It’s financial gridlock or, to coin a phrase, “Trickle-up economic crisis.”

Take a look at the past 35 years with me. In 1972-75 and again in 1980-82, we had two 2 year recessions that were caused primarily by “oil shocks” where our need outpaced what we produced or could import. In the late 80’s/early 90’s we had another recession mainly attributed to a decrease in Industrial production and manufacturing-trade sales (Read: Chrysler (Sound familiar?)) And then in the late 90’s we had the infamous “dot-com” bubble burst. All three, whether energy based, manufacturing based or investment based, caused a major glitch in our economic system at the time. Right now we’re looking at all of them at the same time. Our housing bubble has burst, energy prices though lower right now have just come down from historic highs and OPEC is trying to get them back up there soon and the “heart of our industrial and manufacturing base”, the auto industry, is poised for bankruptcy. Add to that the fact that our banks are flailing and looking for ever more of our taxpayer dollars which can only cause enormous inflation in the future and the downward spiraling stock market and we’re looking at some tough times ahead whether we like it or not; many are already feeling them.

So let’s revisit that notion of reduced consumerism shall we? Let’s say that we don’t buy as much stuff, but when we do buy stuff we actually do BUY it. (Meaning of course that we pay for it with real money at the time we purchase it.) So now, the money that is flowing into the system is real money, meaning that it has been spent and transferred in ownership and can now be invested, loaned, kept or used for other REAL purchases. Wouldn’t the economy still grow? Wouldn’t there still be the opportunity to build wealth and use a free market, albeit perhaps a more equitable one? I can’t help but believe that it would be a more stable one. What if we started to embrace the idea of a green economy, where we were employing people in the professions of building and maintaining our own power so that then the money that we were spending on power could stay here in our economy as well rather than to send it oversees. What if we looked at our homes, not as banks to pull money out of when we wanted a new toy or wanted to pay off the ones we already bought and where we don’t even know the neighbors name but can tell you what kind of car he drives, but rather saw them as long term commitments where we helped to build communities and raise our kids. What would that be like huh? How would it be if we saved some of our money and invested it in our local banks, banks that by the way are one of the only sectors of the banking industry to be still afloat on its own? Am I being “pie in the sky here?” Is it possible? I don’t know but I’m tired of living the other way. I will still consume. I have to, and so too do you most likely. But I do know that the way I consume is changing and that’s for sure.

And look on the bright side, if we handle this the right way, maybe we’ll see a much better foundation on the other side.

Here's to hope!!

P~

I wanted to clarify something from the article as well. It stated that “…President Bush's advice when asked, after the 9/11 attacks, what Americans should be doing. He urged Americans to keep shopping.” That isn’t actually completely accurate, although it does cut to the core of it. What he actually did say was “I ask your continued participation and confidence in the American economy.“ and at the time I think that that was good advice. We had been hit by something beyond our control, and we were scared. Our economy suffered then, but it could be healed by “business as usual”. He did however directly urge us to keep shopping in another speech, much more recently, when in a Dec. 2006 speech he stated, “A recent report on retail sales shows a strong beginning to the holiday shopping season across the country -- and I encourage you all to go shopping more.” Just holding the media to a modicum of accountability there.