Look Back in Amber
Via Yglesias, Economist Michael Mandel of Business Week offers a provocative slideshow whose thesis is that the entire decade from 1997-2007 was, in real economic terms, a lost decade. I don’t know if it suffices as a complete accounting of the last dozen years, but it gets at something I wrote recently about how, after two bubbles in rapid succession, I’m not even sure if we can really say what the recent economic history of the country really is. Especially since we don’t know how bad things may yet get and the forms of stagnation and depression this time around may be less visible than smokestack-era downturns.
Comment by max —
March 3, 2009 @ 6:43 am
I’d say the economic history of the country was that after 1987 (why do I keep saying 1987? That was the point at which Randroid free trade laissez faire types lost their minds and ran around screaming about the unfairness of a stock market fall of 33%. So then we had to have a circuit breaker, that is, price supports for stocks. And then Alan Greenspan gave buckets of free money to rich people and we had a bad recession.) we turned to borrowing from exporters to buy their crap. We had some growth in the middle 90’s and then not much thereafter as all the excess effort in the system was being redeployed to prop up the system. Why, way back then, people thought it was sensible to punish the Russians for giving up Communism while rewarding the Chinese for not giving up Communism is one of those endless numbers of mysteries produced by DC-centric stupidity. Or as Lenin would say, the capitalists (’capitalists’, excuse) were willing to sell the rope needed to hang themselves with.
At any rate: make it, mine it, grow it, or sell your butt on the street; any other business in a country is doomed without production of stuff (in that country).
max
['The reason to pay for frivolous stuff, like R&D or the humanities, or giant pyramids, for that matter is that stuff directly or indirectly results in more material stuff.']
Comment by kid bitzer —
March 3, 2009 @ 7:26 am
one lesson you could take away is that the country is going to keep suffering these problems so long as we measure the economy’s health by the stock market.
the real measure of the economy’s health is the wage of the vast majority of the working people, not the dow jones index.
but for some reason, the extremely wealthy people who program the evening news are more interested in the health of their ample stock portfolios than in whether workers’ are earning more money. (indeed: ‘labor cost’).
Comment by Joe Strummer —
March 3, 2009 @ 9:36 am
Right. We keep talking about a looming “lost decade” (a la Japan) as if we haven’t already had a lost decade. We are back where we were, only with a lot more debt.
So there are more ways than one to lose a decade.
Comment by dhex —
March 3, 2009 @ 10:47 am
alternate explanation: people are, by and large, melodramatic hissy-fitters who are bad at simple math.
if you separated most people who are freaking out over whatever their media outlet of choice is telling them to freak out over and cornered them away from wikipedia, how many would even be able to tell you what the dow measures? or why it’s important? (or rather, not necessarily that important)
probably not many of them.
i knew things were fucked up when i had people sending me emails freaking out over the ted spread. it was the topic du jour, and became their concern du jour.
folks should probably watch less tv, maybe.
Comment by dhex —
March 3, 2009 @ 10:57 am
none of that means we’re not in a recession, mind you, but…things reek of that kind of hysterical circus of idiocy that gave us patriot act 2.0.
Comment by Barry —
March 3, 2009 @ 11:56 am
I pointed out on that guy’s website that an alternate hypothesis was simply that the Bush Years s*cked. Perhaps the big problem was that we simply let the foxes run the henhouse, and they ate the chickens.
Comment by Seward —
March 3, 2009 @ 10:07 pm
kid bitzer,
A nation’s wealth results from increases in productivity, not increases in wages. Growing the pie is far more important than anything else.
Comment by Barry —
March 4, 2009 @ 9:44 pm
“A nation’s wealth results from increases in productivity, not increases in wages. Growing the pie is far more important than anything else. ”
We’ve been hearing that for 30-odd years now.