The mariner searches continuously for good economic news. Good news is hard to find. It was C.S. Lewis who said, “If you look for truth, you may find comfort in the end; if you look for comfort you will not get either comfort or truth…” In the opinion of many top drawer economists – especially international economists – Growth in national economies will be sparse if even possible. Generally, the opinion of economists is that the US is in better shape since the 2008 recession than the rest of the world. But, as Satyajit Das says in his book, The Age of Stagnation; Why Perpetual Growth is Unattainable, the US is in bad shape, too.
Almost universally, economists warn that the US is still fooling itself, that is, our leaders, banks and citizens still hold out for some unknown event that will sustain our current standard of living. Statistically, we already know our children will not have as good a life as their parents have had; the ‘fringe benefits’ of the older generation, such as pensions, comfortable salaries, union benefits, and the idea that retirement is an automatic reward for life’s labors, may be meager if these benefits exist at all.
The big bank situation still remains an issue; banks still gamble in hedge funds and other questionable investments to compensate for slowing growth in the US economy. Our nation sits at a point similar to Japan and Iceland which were hard hit by the recession. Japan still has not recovered and suffers a flat GNP today; Iceland actually went bankrupt trying to hold up an empty economy. Both nations have begun a slow recovery only after government, business and the citizenry realized their coffers were empty and took painfully austere steps to pay back the national debt (and personal lifestyle debt) used to prop up failed economies, reduce the standard of living for everyone, and suffer inflation (which has the effect of cheapening the currency therefore making debt dollars less expensive).
There is a possible light at the end of the US tunnel: many economists believe that the US has enough wealth, especially through taxation reform, to have a bit of cash to invest in a massive upgrade of the nation’s infrastructure and also open new growth markets associated with renewable energy and, through scientific and technological resources most nations do not have, reduce energy practices that destroy the environment.
As if copying the French Revolution handbook, GOP presidential candidates struggle to own the prestige of the Christian Church and undercut secular entitlements at the same time. Definitely an ethical oxymoron; where is Joan when you need her? The democrat candidates support the idea that the unknown event may occur, bringing peace and harmony back to the middle class. At least there is a possible event suggested by the economists, that is, tax reform, infrastructure, and renewable energy, but readers must not forget the words of C.S. Lewis. The truth we will find is that the US and its citizens have been borrowing for years to sustain an unsustainable standard of living. The standard of living for everyone will take a hit while that debt is paid off.