Economic fruits of liberalism

In this blog Dalwhinnie posted the following about America.

America is in one of its low points… It is important to remember the America that was, has been, and will be again.

Before adopting a  Panglossian view of America, it is important to answer the question, what happened to Detroit and what is happening to California? First Detroit.

Last year Obama spoke of Detroit as follows.

President Obama on Saturday painted a strong contrast between his record on the auto bailout with that of his presidential rival Mitt Romney, touting his own refusal to “let Detroit go bankrupt.”

In his pre-taped weekly address Mr. Obama, referencing a 2008 op-ed in which Romney argued against bailing out the auto industry (entitled “Let Detroit Go Bankrupt”), outlined his administration’s efforts to save the industry upon being elected.

And today, on a day which the US stock market hit all-time highs because things are going so well, we heard this.

The city of Detroit filed the largest municipal bankruptcy case in U.S. history Thursday afternoon, culminating a decades-long slide that transformed the nation’s iconic industrial town into a model of urban decline crippled by population loss, a dwindling tax base and financial problems.

The 16-page petition was filed in U.S. Bankruptcy Court in Detroit.

Heckuva job Obama! Some people blame the problems in Detroit to decline of the auto industry, unions, white migration and black politics. How could a city, that was at the center of an area that produced 45% of the world manufacturing output after WW2 go bust? Those excuses are reasonable but what about California? Its problems are summarized by Hanson.

California’s multidimensional decline—fiscal, commercial, social, and political—sometimes seems endless. The state’s fiscal problems were especially evident this past May, when Governor Jerry Brown announced an “unexpected” $16 billion annual budget shortfall… According to a study published by a public policy group at Stanford University, California’s various retirement systems have amassed $500 billion in unfunded liabilities…

Not just in its finances but almost wherever you look, the state’s vital signs are dipping. The average unemployment rate hovers above 10 percent. In the reading and math tests administered by the National Assessment of Educational Progress, California students rank near the bottom of the country, though their teachers earn far more than the average American teacher does. California’s penal system is the largest in the United States, with more than 165,000 inmates…

Meanwhile, business surveys perennially rank California among the most hostile states to private enterprise, largely because of overregulation, stifling coastal zoning laws, inflated housing costs, and high tax rates. Environmental extremism has cost the state dearly: oil production has plunged 45 percent over the last 25 years, even though California’s Monterey Shale formation has an estimated 15.4 billion barrels of recoverable oil, according to the U.S. Energy Information Administration…

Worst of all is that neither the legislature nor the governor has offered a serious plan to address any of these problems…

Here is a state that is at the center of a technology boom led by firms like Apple and Google as well as countless others. This technology boom, led by computer firms and associated technology, is clearly one of the most important events in economic history. Several hundred years hence, this period will be still be viewed as pivotal to human progress, yet a state at the center of it all struggles. The introduction of personal computer in the 80s and internet in the 90s, are just recent events in the past yet America seems to have expended all the benefits accrued from this development.

How could that be? How could a state that epitomized rugged individualism a mere 50-years ago, go from that to what it is today where liberals control all levers of government and Republicans don’t need to bother showing up because Democrats have super-majority with which to force legislation through.

The only thing they have in common is the brand of economic, social and cultural policies that are practised. Things are no different at the federal level which is led by a guy who in 2010 said “I mean, I do think at a certain point you’ve made enough money.” That really shouldn’t come as a surprise because we learned in 2008 that life as you know it in America was over.

Barack Obama will require you to work. He is going to demand that you shed your cynicism. That you put down your divisions. That you come out of your isolation, that you move out of your comfort zones. That you push yourselves to be better. And that you engage. Barack will never allow you to go back to your lives as usual, uninvolved, uninformed.

When Jimmy Carter says that “America has no functioning democracy” and we hear former Supreme Court Justice David Souter state that the “pervasive civic ignorance” in the U.S. could bring dictatorship you know that America has changed fundamentally and any predictions of its future must take that into account. If things are like this during this economic up cycle what will happen during the next down cycle? Who will be left holding the shit can?

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