Stimulate me.
You pull up a chair, funny how you keep coming here, is it to honor or laugh at the old man's wonderings. Or just to kill time? The beasts wander the streets, the coffee is too strong, maybe that's why he puts vodka in his...
You hafta understand it's the sustainability I worry about. Although the systems are great at reinventing themselves, it's the bloodshed on the way that bothers me. I just wish we could leave you kids something better, maybe you're better off making it up as go along, building your own system. Still you have come to see the world as able to provide you with something, I would like to think that will be true, hate to see your hopes dashed. Especially those poor bloody young conservatives, wed to something that just wont be there for the long haul.
Because you see it aint sustainable in its own right. The economics, dear God, what would I be talking about. Not the beast the way we know it. It constantly needs stimulus. The stmulus gives you growth, which drives the profit drives share model that we all live by now. The money these days is made through investments, the value of investments is spurred by growth, but how does it grow? O.k. growing populations are a key, although that does nothing to reflect per capita wealth, or raising standards of living, or increasing profits. You get more people, more people need things, more people spend money, you've got growth in it's simplest form. Well population growth is going to slow and stop, I think the U.N. suggests about 2050, whatever, it will come.
Then you can get growth from technological turnover, although that at this point just helps to maintain the status quo, we've become so used to trading in the old for the new. Still new products are developed, we gotta have em, new industries rise, and growth is helped.
Then the biggy of late, turn poor people into consumers, or use em to make goods cheaper for the consumers of the world so they can buy more. In the process they make money and start buying all the crap themselves, the bankers, the corporations, and the investors in the developed economies make money, it gets shoved around and you have growth.
Those wars can sure enough stimulate an economy. You get all that debt spending, all that government growth, pumping up those leaches in Eisenhower's famous military industrial complex, I sure as hell hope that isn't the stimulus we're relying on though.
You can stimulate things through other government spending. But its bloody hard to control the waste, which winds up being a drain.
The resources are going to run out too. Imagine a world so bloody hungry for raising standards of living, as if the bastards shouldn't be, that the slightest uptick in demand causes uncontainable inflation. Figure it out. The new energy sources will never give as much kick for the buck as the oil has. Not to mention the plastics, the copper, the iron, etc, etc, etc. That is going to put a major dent in growth.
You see what is the system without the stimulus? Look at how the global markets shudder when it looks like the money to fund mergers gets threatened, why? Because the mergers stimulate profits. Look at how everyone wants labor markets liberalised, why? Because it stimulates the economy. Look at how everyone calls for tax cuts, why? Because it stimulates the economy.
Oh so many options, the stimulus occurs naturally, always. Ah what short memories. Sweet cheeks, a bit ago advanced economies were stagnating. Getting drug down by corporate uncompetiveness, high taxes, and luxurious labor agreements. Then came along the mantra of cutting taxes in the U.S., globalisation, and let's not forget the IT revolution. Europe wasn't far behind. There was also the benefits of increased immigration. Things were revitalized. Profits went through the roof. And like sorry wealth junkies we became so used to them that we built a model to them. The profit drives share price model. And who needs wages anymore? Wages represent a drag, a negative to the process, that is as is aid old school.
But it isn't going to last, you can only stimulate so much. Taxes have to find a level of sustainability, where needs are paid for but they don't suck the system dry. Labor markets can be liberalised until the poor saps in the developing economies start wanting their piece of the pie. Exploiting new markets runs into the wall of limited resources. Then that old spectre returns. No growth, low profits, poor productivity. Old Europe, before the recent charms of globalisation is the future of the world economy.
And you know what? It's o.k. We do, however, need to adjust our expectations. We do need to make sure the waste of entrenched interests doesn't eat us alive. We do need to make sure that corruption doesn't control the flow of resources and suck the life out of making the most of what we have. We do need to recognize that if globalisation is going to be an equalizer of standards of living that doesn't mean the rampant consumerism of the U.S. will be the norm. The new model can work, but it wont have much to do with the current model. Hopefully we just don't need to burn down the neighborhood to build a house.