Home > Uncategorized > The U.S. is facing 20 formidable headwinds

The U.S. is facing 20 formidable headwinds

from John Komlos and current RWER issue

Cultural challenges are insurmountable

  1. The defective dominant ideology of neoliberalism characterized “by a huge overestimation of the wisdom of market processes,” has seeped into the popular culture to such an extent that it is difficult to make the citizenry understand that the best government is not one that governs the least.[1] It easy for market aficionados to label progressive politicians who aspire to improve the condition of the poor through government programs as socialists.

Social challenges are deeply rooted

  1. Endemic racism haunts the social fabric. The lack of jobs, the mediocre educational system, and the limited safety net available to minorities makes it difficult to improve their life. The unemployment rate among minorities is usually twice that of whites. African Americans are 1.8 times as likely to be poor than their share of the population and their annual median household income was $24,600 less than that of whites in 2016. They are looked down upon because of their poverty, but their poverty is due to lack of opportunity and inferior schools available to them.
  1. It is widely recognized that the economy in unjust and is not working for half of the population. The top 1% earn 20% of national income. The bailouts of the financial system in 2008 left all the banks in the top 1% of the wealth distribution. None of them sank down into the middle class. Dick Fuld, who bankrupted Lehman brothers, still has $250 million in the bank, while Angelo Mozilo who bankrupted Countrywide Financial has $600 million. However, eight million families were callously evicted from their homes without mercy. Such asymmetric bailouts are indicative of the power of the oligarchy that fueled the populism harnessed by the Trump presidency.[2]
  1. The primary and secondary educational system remains mediocre. So, it does not prepare the next generation for the IT revolution. Furthermore, a large share of the poor is unable to afford college education so important in today’s economy. Hence, the significant demand for IT professionals is unmet. Yet, money is not available to improve the educational system.
  2. Life expectancy was falling even before the pandemic. The 150,000 people who die of “deaths of despair” provide evidence of the immense anxiety at the low end of the income distribution.[3] Such epidemic of suicide does not occur in a good economy.

The economy is out of balance      read more

  1. Ken Zimmerman
    April 28, 2021 at 5:34 am

    The USA is and has been in cultural and social (including economic) decline since 1980. That decline is I believe now permanent. Without radical changes and soon america as a society may cease functioning. To save us I suggest: end neoliberal economic control; radically equalize (by taxation, wage and wealth control, or actual physical redistribution if necessary) wealth and income; nationalize all banks and major essential companies; close all financial markets while strict new regulations are prepared and implemented; arrest all insurrectionists large and small and begin trials, including Donald Trump; disband the Republican Party in whatever ways necessary. At least with this the USA would have a fighting chance of survival.

  2. Robert Locke
    April 28, 2021 at 8:05 am

    The French Revolution began when the privileged tried to stop a bankkrupt gov;t from taxing them.,

  3. poireau
    April 29, 2021 at 8:00 am

    This very synthetic and enlightening summary of the structural weaknesses of the US economy ( and of the political system which supports it ) is to some extent applicable to the situation of European economies ( although with less blatant inequalities due to the preservation so far of the heritage of the welfare state and of differences with regard to the political system and to the local culture which may evolve also in the wrong direction ).
    I am puzzled to see that too little room is made for analysis and proposals regarding the evolution of economic policy and practical decision-making to cope with the prospect of secular stagnation and of a new economy and a new economy policy addressing the need of the ecological transition, in line with the comments posted by Ken Zimmermann above. I am struck by the far too limited number of articles in the main economic journals ( and also in your excellent blog!) dealing with the links between economy and the various aspects of the ecological crisis and of the practicalities of the evolution towards a sustainable economy taking into account the limitation of resources , the need to reduce the burden and cost of pollution , to preserve biodiversity in the short and long term etc , together with the creation of a positive and motivating perspective for the people to move in this direction.

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