September 27, 2006

Losing Competitiveness

Bloomberg reports that the United States is no longer considered the most competitive economy in the world. In fact, in the last year we have slipped from number 1 to number 6.

An economist from Brookings on the BBC Report tonight thinks that the reason Bill Clinton presided over a good economy was partially luck and partially doing the right things (lowering the deficit) which was why the economy did so well under him.

Well, let's look at what that says about Bush, the ultimate go-for-broke guy. Bush is the epitome of the reckless gambler: place your bets now on any ole hand and let the future take care of itself, because, by golly, when your ship comes in, you will have won the jackpot. Considering that our economic decline is on Bush's watch, it is instructive to see what policies have led to the decline.

As Bloomberg says, one factor in downgrading the US performance was the dropping public confidence.

The country's overall competitiveness was also undermined by increasing doubts about the effectiveness and trustworthiness of its political leaders with the government's delayed reaction to Hurricane Katrina likely damaging the public's confidence, the forum said. Weaknesses were also detected in primary education and healthcare, with infant mortality and HIV/AIDS more prevalent than in other rich economies.

Most Americans no longer believe this government will do anything to help the people of the United States. Katrina and the current state of our Army shows what a mess this government can create. Add to that the collapse of our health care system and the lovely "donut" hole that is making senior citizens choose between cancer medicines and diabetes. (Lovely, that - you can decide whether it is better to die (fast) from cancer or (slow) from diabetes.) And HIV/AIDs? Well, in today's United States, we'd rather condemn condoms and blame the babies born with HIV/AIDs for being stupid enough to select such bad parents. As Bush likes to think, it is all about the choices you make -- your wealth is an indication of your faithfulness to God.

Another negative indicator of today's economy is the declining housing market. But Bloomberg had a rather quaint description of the problem.

Falling prices will make it harder for consumers to tap the equity in their homes, a major source of cash in recent years. That may pose a risk to their spending, which makes up 70 percent of the economy.

Not mentioned is the number of Americans who borrowed too deeply on their non-existent equity and are now facing the relentless rise of interest rates which threatens to wipe out everything they ever earned or owned. But in Bush's world, the banks will do okay, because they can hedge those risky loans, and so the only people who will pay the price will be the people too naive to understand the risk they were making by playing in Bush's gambling club.

Finally, not mentioned in Bloomberg's report is the very real slippage of American competitiveness because we've become a much more paranoid and less open country. How much have we loss by our visa policies? And wouldn't you think twice about coming to America if you thought you could be "disappeared" at any time with only the President having a say?

But obviously, this new America -- a colder, harder and bleaker country for most people -- is one that works very well for Bush and his rich friends. In fact, you might think the game was rigged to favor them.

Posted by Mary at September 27, 2006 01:27 AM | Economy | Technorati links |

FOX NEWS REPORTS THAT 5 PUPILS ARE HELD HOSTAGE BY AN ADULT GUNMAN IN COLORADO SCHOOL.Jefferson County-Columbine. Bomb squad en route. Remote bomb vehicle moving in.

Posted by: ccoaler at September 27, 2006 01:05 PM