Public paralysis but private empowerment?

After the American Century                                                                                                                                                                      

These seem to be strange times. President Obama seems unable to close the Guantanamo prison, after five years, in good part because other countries are resisting taking on any of the remaining prisoners. He seems unable to push through a gun control control bill, due to the powerful pro-gun lobby ed by the National Rifle Association. He is struggling to get an immigration bill through. Some columnists are suggesting that he is already a lame duck, but in fact it is Congress that is lame, very lame. 

Meanwhile, in foreign policy, the president has so far managed to avoid getting entangled in Syria, while trying to extricate the US from Afghanistan. The US left Iraq, but its troubles seem unabated. Possibly Iraq's non-existent weapons of mass destruction have been moved to Syria, but no one seems to know if they have poison gas or not, or which side may have used it. Meanwhile, Iran keeps developing its atomic weapons, while claiming not to. More generally, the Arab Spring, so-called, seems to be producing a harvest of religious fanatics, and it is hard to be upbeat about current events much of anywhere in the Middle East.

Yet while the president seems tied down by any number of outside factors at home and stymied in many foreign initiatives, the New York Times reports that hobbyist genetic engineers are trying to create trees that glow in the dark, and that might one day eventually replace public lighting. This tinkering with DNA seems mad, but it is happening. And a Dutch TV station and some private investors are conducting a lottery for a new kind of reality show that intends to select and train a crew to go to Mars. Perhaps they can take some seeds for those glowing trees with them, and plant them in patterns that spell out the names of corporate sponsors. More likely, the contestants who are sent to Mars, if any, are going to risk their lives for what, exactly?

It seems that private enterprise, clusters of people on the Internet, and rich individuals are becoming more and more powerful, while elected leaders are mired in political systems that make it difficult to act, unless there is a national emergency.  Public paralysis but private empowerment? This is a gloomy conclusion; I hope I am wrong.

Happy Birthday Leonardo da Vinci

After the American Century

April 15 was Leonardo da Vinci's birthday. Some years ago I was agreeably shocked to learn that I had been selected to receive the Leonardo da Vinci Medal. This is awarded to no more than one person each year, and in some years not awarded at all, by the Society for the History of Technology. There is no possibility of false humility in such a situation, for the humility is quite real and unavoidable. Make a list of all the many things Leonardo could do, and there is not one that I can do even remotely as well. Furthermore, what strikes me, when I think of Leonardo da Vinci, is that he was so interdisciplinary and able to work with a wide range of people to realize diverse projects. That he was extremely talented there can be no doubt, but just as important, perhaps, was his easy movement between, and transfer of ideas from, his various activities. Today scholars are pressured to specialize, but in his age there was apparently an easier flow of ideas and people, a mixing of artisans and the arts, of church and state, of military and civilian life, or of science, medicine, and technology. One finds Leonardo at one time or another involved with all of these and more.

For me or any modern scholar to receive a prize named after the person who embodied the ideal of the Renaissance man seems preposterous. If one of us manages to connect just a few fields – in my case a little art history, some literature, a smidgen of technology, and a large dose of history – this is not remotely in the same league with what Leonardo achieved.  I will never produce anything that will have the iconic status of the Mona Lisa, The Last Supper, or his drawing of Vitruvian Man, nor will I invent new devices, nor devise new military technologies, nor design bridges, or any of the rest of it.

In short, it is a humbling distinction to receive the Leonardo da Vinci Medal, because the more I or any recipient thinks about it, the less worthy we must feel.  One almost longs to have received an award named after a more obscurely famous person, in order to have a chance of withstanding the comparison.

Gradually, however, I have seen that it is an advantage to realize how impossible it is to live up to the name of this medal, no matter how much one has achieved. Since it is entirely hopeless to demonstrate, either before or after receiving it, that one really deserves the award, I feel released to keep on dong my bumbling best. And at least one can never receive an award named after an even more famous person. Who could that possibly be? Leonardo puts one so completely in the shade that no further distinctions or awards can stir up immodest delusions.  In its way, that is quite a benefit.

Tenth Anniversay of the War in Iraq: History will judge George Bush a Failure.

After the American Century

Ten years after the invasion of Iraq, it should be obvious that President George Bush made an enormous blunder. Thousands of American soldiers died, but far more than ten people from Iraq died for every American who perished.  The country is struggling with sectarian and ethnic divisions, and its enormous oil wealth has yet to lift it out of economic instability. The progress is slow, if, indeed, there is any progress.

There were no weapons of mass destruction in Iraq. Bush and the Republicans insisted there were. They were wrong. Did they lie, or were they incompetent?

Democracy did not blossom in Iraq once their dictator was removed. Bush and the Republicans, particularly the neo-conservatives, insisted that democracy would emerge out of the war. They were wrong.

Millions of Americans protested.  In February, 2003, during the buildup to the War, I marched twice against it, once in Cleveland and again in San Francisco. In each case, I had been invited to give a lecture, and happened to be in town when the marches took place. There were many such protests all across the US, including Boston, New York, Washington, Chicago, and also small cities such as South Bend, Indiana. We were ignored at the time, but we were right.

Protest in Manhattan Against the Iraq War, 2006

The claim was that the Americans would win a quick victory and that the occupation would not require too many troops. In fact, more people died after the war was officially declared to be over than during the war itself, and a large number of troops were needed for most of the last decade.

The cost of the war in Iraq was not financed by tax increases. Instead, Bush and the Republicans engaged in a form of fantasy economics, assuming that budget cuts would stimulate the economy so much that deficits would decline. Instead, US debt ballooned. At its worst, the Iraq War and occupation was costing $1 billion every day. Bush and the Republicans were wrong. They squandered money that they did not have.

History will not be kind to George Bush, nor should it be. Either he lied or he was misled about why the US went into the War. In judgement, he failed. In execution, he failed. The war was waged for the wrong reasons, and the peace was lost through further incompetence, including torture of prisoners, hiring corrupt contractors, and on and on.

Bush thought he was projecting American power, but instead he projected insensitivity, arrogance, and incompetence. His war caused enormous suffering; its full consequences are still unfolding. The wars in Afghanistan and Iraq probably made better relations with Iran impossible and made it easier for the hardline fundamentalists there to remain in power. The Kurds became semi-autonomous in eastern Iraq, but this created problems for Syria and Turkey, which have Kurdish minorities. Nationalism and religious fundamentalism are on the whole stronger in the region, while all the economies are weaker, except for those on the Arabian peninsula, with their oil wealth. If there is a silver lining emerging from the clouds of war, it is hard to see.

The Sequester and the Congress Are a Disgrace

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The current deadlock in Washington is the result of a failed political process. In particular, the United States Senate has created rules that prevent it from getting anything done. The House is little better. The public watches with a mixture of amusement, anger, and despair. The poll ratings for Congress are so low one might think the United States had a legislature made up of appointed political hacks. Could intelligent and dedicated politicians really produce anything as inane as the Sequester?

Neither Americans nor the rest of the world can respect such legislative incompetence. A Chinese cartoonist depicted the situation this way in The China Daily:

In Britain, The Economist concluded, "The rather camp-themed scenario in which Congress tries to force itself into behaving with the spectre of whips and cattle prods ends with the US economy handcuffed to the bed and no immediate prospect of escape."  The Economist makes the spectacle sound a bit kinky, but I find it just sad. What investor or voter can be inspired by such intransigence and incompetence? The economy is improving, and the unemployment rate is falling, but the sequester threatens to undermine the recovery. European nations have tried austerity measures based on analysis, perhaps mistaken analysis, but some thought went into it, and they have failed. The US now has embraced mindless, robotic austerity measures, which one assumes are certain to fail, though the American economy is actually doing better than it should, under the circumstances.

The automatic across the board cutbacks that are imposed by the Sequester Agreement are literally mindless. Rather than take a hard look at Federal spending, the cutbacks make no distinction between programs that are working and useful, those that are pork, or those that have outlived their original purpose. Uniform cuts, in the end do not make any sense. Should the government build half an aircraft carrier or half a fighter plane? Should school children get lunch some days but not others? To put it another way: are all the things the government does of equal value? Are all of them of equal urgency? Do all of them stimulate job creation to the same degree? Do all of the government's programs have an equally beneficial effect on the environment? Clearly the answer to all of these questions is "NO."  Some programs create jobs and have a multiplier effect, and others retard economic growth. Some prevent pollution, others create it.  

The job of the legislature is to make intelligent choices between programs. Which ones should be funded, and to what extent? But Congress is in dereliction of its duty. It has ceased to function intelligently. It avoids choices. It does not engage in intelligent debate followed by compromise. It has abdicated responsibility and allowed uniform, mindless cuts in every program. 

The current US Congress is a disgrace.

Centennial of the American Assembly Line, 1913-2013

After the American Century

 The assembly line was invented in 1913 and has been in continuous operation ever since. It has spread to every industrial nation and has become the most familiar form of mass production. Some corporations that adopted it made enormous profits; others went bankrupt. It has been praised as a boon to all working men and women, yet it has also been condemned as a merciless form of exploitation. It has inspired novels, poems, popular songs, and even a short symphonic work, but it has also inspired satire and visions of apocalypse. It was embraced by both Nazi Germany and the Soviet Union, yet Americans believed that the production lines of Detroit ensured the victory of democracy in both World War II and the Cold War. More recently, it was reinvented in Japan and exported back to the United States as lean production.

Early example of moving assembly line

As the assembly line spread, its effects varied. Between 1914 and 1940 a few nations and some industries embraced it rapidly, others slowly, and some not at all. European nations adopted it more slowly, even after World War II, preferring the flexibility of skilled workers over the standardization of semi-skilled work on assembly lines. In more recent decades, mass- production industries have gradually moved away from the expensive labor markets of Western Europe and the United States to less costly venues in Asia and Latin America. Once the engine of US prosperity, the assembly line now increasingly drives competing economies elsewhere. Its complex social and economic effects have become global.

Bomber production during World War II

The assembly line emerged in a specific place (Detroit), at a specific time (between 1908 and 1913), in a specific industry (the automobile industry). But it also expressed trends in American society that can be discerned during the nineteenth century. It was the culmination of decades of labor-saving devices, new management ideas, improvements in metal alloys, increasing precision in machine tools, and experimentation with production. Yet that this form of production should be invented in the United States was not inevitable. The elements that came together to form the assembly line could also be found in France, in Germany, and in Britain. Any of the other industrial nations might have hit upon it first. Nevertheless, the United States proved particularly suitable for its emergence. A cultural context either fosters or resists a new technology. Before Henry Ford was born, speed, acceleration, innovation, interchangeable parts, uniformity, and economies of scale already were valued in the United States, where the values that the assembly line would embody were woven into everyday life. 

The assembly line was created at Ford’s factories was not a final result, but a part of an ongoing cultural process. America's Assembly Line is a centennial history of this central technology and its effects on work, leisure, and everyday life.

David E. Nye, America's Assembly Line    MIT Press

                                                        Published Feb 15, 2013  

                                       ISBN-10: 0262018713        ISBN-13: 978-0262018715

"To make sense of their twenty-first-century world, people need to understand the profound influence of the twentieth-century technology known as the assembly line. David Nye's sweeping analysis of the origins and development of 'the line' is the place to start." -- Robert Casey, former Senior Curator of Transportation, Henry Ford Museum


"It is hard to think of a manufacturing technology that has had a greater economic and social impact than the moving assembly line. In America's Assembly Line, David Nye shows us how this new technology emerged, expanded, stalled, and was reinvented, setting in train the age of mass production and consumerism as well as many of the subsequent environmental problems we experience today. Nye's beautifully nuanced and perceptive treatment of the subject indicates why he is one of the most distinguished historians of technology and culture working today." -- Merritt Roe Smith, Cutten Professor of the History of Technology, MIT


"Crafted with immense erudition, America's Assembly Line is a fascinating cultural history, combining extensive archival research and theoretical sophistication. Nye shows how America's growing economy in the twentieth century was powered by the assembly line and how deeply this 'general purpose technology' was intertwined with American culture, from the exuberance of the Rockettes to the dysphoria of the American worker. He offers a lucid, historically informed reading of the problems that beset America today, in a changed global economy that has adapted assembly-line technology to its advantage even as the American worker has been marginalized." -- Miles Orvell, Temple University, author of The Death and Life of Main Street: Small Towns in American Memory, Space, and Community

Available at these and other booksellers:

Waterstones  

Barnes & Noble

Amazon

See also a visit to BMW's assembly line.

The Geography of American Invention

After the American Century                                                                                                                                                        

A new study from the Brookings Institution reveals that a relatively small part of the United States produces most of its patents. As reported in the New York Times, the Census Bureau divides the nation into 370 "metropolitan statistical areas" but two out of every three patents is produced in just 20 places. 

It is even more interesting to study the top five of these 370 areas. Those with "the most patent filings per million people, from 2007 to 2011, were San Jose-Sunnyvale-Santa Clara, California; Burlington-South Burlington, Vermont; Rochester, Minnesota; Corvallis, Oregon; and Boulder, Colorado." None of these places are large cities. All are attractive small cities, in beautiful natural settings where it is more desirable to live than most other locations in the US. All of them have universities and/or large medical centers at their core. All of these places now are, or at least once were, less expensive than major cities. In short, these are upscale, attractive areas with highly educated populations in smaller cities. The extremes of urbanism or rural life are not represented. These are middle landscapes that talented people will choose to live in or that they will be happy to move to. Not Philadelphia, but Princeton. Not New York City, but Ithaca. Not Denver but Boulder.

Patents per worker, 2011

In such locations innovative people can afford to live and to establish offices or labs more easily than in the large cities. In such places they also can find like-minded  innovators more easily than in large cities. These smaller places have a critical mass of talent, but not much heavy industry such as steel mills, and they have less traffic and better public schools than most places.

The implications for other nations need to be underscored. Rather than try to make Europe's largest cities the centers of innovation, it makes more sense to look for smaller university towns analogous to Austin, Burlington, Boulder, or Corvallis. In Denmark the potential for innovation per capita should therefore be higher in Aalborg or Odense than in Copenhagen. In Britain, innovation should flourish not in London or Manchester but in Cambridge or York. 

Furthermore, the study shows that it is much smarter for a city to invest in research universities than in football stadiums or downtown shopping malls. Stadiums represent the "build it and the consumers will come" school of thought. However, fans and consumers may go elsewhere. Universities generate patents and new businesses that create new sources of income, jobs, and production, with consumption an inevitable by-product of the high incomes characteristic of such communities.

This is not to say that no innovation takes place in large cities. Of course it does. But in the United States the most innovative locations have other demographics.

The Brookings Institution report can be found here.

Obama's Priorities for the Second Term

After the American Century                                                                                                                                                         

On the night he was re-elected, President Obama said that he had four priorities for his second term. These were deficit reduction, tax reform, a new immigration law, and reducing dependence on foreign oil.  

Since then gun control has been forced onto the national agenda, and Obama has announced that he would like to impose more controls on the sale of automatic weapons. The Constitutional guarantee of the right to bear arms, written quite clearly into the Bill of Rights, will not easily be overthrown, however. Any major change will ultimately require the assent of 75% of the states. There are quite a few rural states where any such Constitutional amendment will be hard to push through. Remember the failure to pass the Equal Rights Amendment for women? I am sure Obama does, and he will not want to waste too much political capital on lost causes.

Let us look, instead, at the four announced goals, each in turn.

Deficit reduction. This problem did not exist in 2000, but was created by the un-financed Bush tax cuts and the un-financed wars in Iraq and Afghanistan.  Now that the war in Iraq is over, and that in Afghanistan is winding down, one consequence ought to be some savings in military spending.  In general, however, it will be hard to reduce the deficit by cutting programs.  The only intelligent way to do this is to increase taxes back to the level of the Clinton years. This leads to the second goal:

Tax reform.  During the campaign Obama spoke of reducing taxes, making this possible by closing loopholes. I have heard this idea since I was old enough to understand what politicians were saying, but either clever accountants and lawyers keep finding new loopholes or this is just rhetoric, or maybe some of both. Meaningful tax reform would seem to require the progressive taxation that existed for decades before the Republicans began to slash away at it, from the Reagan years onwards. Warren Buffet, one of the wealthiest men in the US, has said that it is ridiculous that his tax rate is lower than his secretary's. He and a group of other super-rich Americans have called for higher rates on themselves. One hopes that a few Republicans in the House will heed this call for a responsible tax policy. One way or another, revenues must be higher and spending held in check, so that the national debt once again can begin to be paid off. Curiously, the most successful debt reduction since 1970 came during Clinton's presidency. Had Bush left his tax system alone, the US would not be in the fiscal mess it is in now. I expect some changes to be made, but given the Republican dominated House, I do not expect to see real "reform." I would love to be mistaken.

Immigration Reform. An estimated 11 million illegal immigrants now live in the United States. Given the presumed importance of secure borders and Homeland security, this is anomalous, to put it mildly. The majority of these immigrants are of Hispanic origin, and Obama has promised to provide them a road to legal status and ultimately citizenship. Since more than 70% of Hispanic votes went to Obama, he has every interest in delivering on this pledge. If the Republicans vigorously oppose him, they will drive the Hispanics even more firmly into the Democratic camp. This would seem to be an issue on which the Democrats cannot really lose, even if in the short term they lose in Congress. In the longer term, these 11 million or more people have to be dealt with fairly. Moreover, Hispanics are the largest minority, far more numerous than African-Americans. The good news is that the Republicans and Democrats seem to be negotiating with some success on this issue, and a new law might be passed. It appears that it will not deliver simple amnesty, but require payment of back taxes and the like before an illegal immigrant can get on the road to citizenship.

Reducing Dependence on Foreign Oil. US oil production has been rising since 2009, based on changes made during the Bush years, which allowed oil companies to use high pressure water and chemicals to force oil and gas out of the ground - so-called fracking. The environmentalists do not like this practice, which endangers the water supply, and for that reason the Obama team is making all the right noises about being responsible. But at a time when jobs are scarce and energy expensive, the Democrats are allowing this new form of oil and gas development. But the reality is that growing US oil and gas production encourages Americans to keep on consuming at a high level. True, Obama did get through Congress much higher minimum mpg limits for new cars, and American drivers will become more fuel efficient every year for a decade as a result. But alternative energies will have a harder time in a marketplace awash with new oil and gas, and otherwise hard-hit states like Pennsylvania that are getting jobs and growth from fracking are not likely to rush to adopt solar or wind power. Obama is a pragmatist, seeking short term "energy security" in oil and gas supplies, while still pushing alternatives in the longer run, Meanwhile, he has also been pushing for more energy conservation, where there is still plenty of opportunity for improvements.

If we take this as the Obama project for the second term, it seems likely he will succeed in his energy program and that he has a good chance with immigration reform- However, he will have a harder time with the deficit and tax reform, though in each case some progress might be made.

The legacy Obama will leave behind, undoubtedly, will be his transformation of the medical system. If its implementation is successful, "Obamacare" will become as integral to the American way of life as Social Security or Medicare.

Finally, there is the economy, which Obama, or any president, actually has less control over than most people think. I will return to this subject in a later blog.

Historical Document: Fredrika Bremer on Industrial Work and Slavery in 1851

After the American Century

New England Mill, c. 1850

Historical Document

The Swedish novelist and champion of women’s rights Fredrika Bremer visited the United States in the middle of the nineteenth century, a decade before the Civil War. She traveled widely and made many interesting observations of the places and people she saw. In this connection, she is known for the book she published on these travels, under the title Hemmen i den nya världen,  Stockholm, 1853, and immediately translated into English as The Homes of the New World: Impressions of America, vol. I-III. London, 1853.  

The selections below concern the industrial mills in Lowell, Massachusetts and the institution of slavery. They come from her letters, which were only published in 1924 under the title America of the fifties: letters of Fredrika Bremer, edited by Adolph B. Benson. New York, The American-Scandinavian foundation, 1924.   

On the Mills at Lowell

I visited the celebrated manufactories of Lowell. I would willingly have declined the journey, because it was so cold, but they had invited strangers to meet me, got up an entertainment, and therefore I was obliged to go. And I did not regret it. I had a glorious view from the top of Dewcroft Hill, in that cold, starlight winter evening, of the manufactories of Lowell, lying below in a half-circle, glittering with a thousand lights like a magic castle on the snow-covered ground. And then to think and to know that these lights were not ignes fatui, not merely pomp and show, but that they were actually symbols of a healthful and hopeful life in the persons whose labor they lighted; to know that within every heart in this palace of labor burned a bright little light, illumining a future of comfort and prosperity which every day and every turn of the wheel only brought the nearer. In truth there was a deep purpose in these brilliant lights, and I beheld this illumination with a joy that made the winter's night feel warm to me.

The following morning I visited the manufactories and saw the young ladies at their work and at dinner; saw their boarding-houses, sleeping-rooms, etc. All was nice and comfortable, as we had heard it described. Only I noticed that some of the "young ladies" were about fifty, and some of them not so very well clad, while others again were too fine. I was struck by the relationship between the human being and the machinery. Thus, for example, I saw the girls standing, each one between four busily-working spinning-jennies: they walked among them, looked at them, watched over and guarded them much as a mother would watch over and tend her children. Machines are becoming more and more obedient under the maternal eye of intelligence. The procession of the operatives, two and two, in shawls, bonnets, and green veils, as they went to their dinner, produced a respectable, imposing effect. And the dinners which I saw at a couple of tables (they take their meals at small tables, five or six together) appeared to be good and bountiful also. I observed that, besides meat and potatoes, there were fruit tarts.

The industrious and skillful can earn from six to eight dollars per week, never less than three, and so much is requisite for their board each week, as I was told. The greater number lay by money and in a few years are able to leave the manufactory and undertake less laborious work.

On slavery

You may believe that there are many discussions here about slavery. I do not originate them, but when they come, which they frequently do, I express my sentiments candidly, though as inoffensively as possible. One thing, however, which astonishes and annoys me here, and which I did not expect to find, is that I hardly ever meet a man, or woman either, who can openly and honestly look the thing in the face. They wind and turn about in all sorts of ways, making use of every argument, sometimes the most contradictory, to convince me that the slaves are the happiest people in the world and do not wish to have their condition altered or to be placed in any other relationship to their masters than the present one. In many cases and under certain circumstances this is true; and it occurs more frequently than the Northerners believe. But there is such an abundance of unfortunate examples, and always must be in this system, that the idea is detestable.

In general the house slaves here seem to be well treated; and I have been in houses where their rooms and furnishings (for every servant, male or female, has his own pleasant room) are much better than those provided for the free servants of our country. The relationship between the servant and the employer seems also, for the most part, to be good and genuine; the older servants especially seem to stand in that affectionate relationship to the family which characterizes a patriarchal condition, and which it is so beautiful to witness in our good families between servant and employer; but with this important difference, that with us the relationship is the free-will attachment of one rational being to another. Here, also, may often occur this free-will attachment, but it is then a conquest over slavery and that slavish relationship, and I fancy that here nobody knows exactly what it is. In the meantime, it is true that the negro race has a strong instinct of devotion and veneration, and this may be seen in the people's eyes; they have a peculiar, kind, faithful, and affectionate expression which I like, and which reminds me of the expression in the eye of a dog. Also, they have a natural tendency to subordination to the white race and to obey the higher intelligence; and white mothers and black nurses prove continually the exclusive love of the latter for the child of the white. No better foster-mother, no better nurse, can any one have for her children than a black woman; and in general no better sick nurses than the blacks, either male or female. They are naturally good-tempered and devoted; and if the white "Massa" and "Missis," as the negroes call their owners, are kind on their part, the relationship between them and "Daddy" and "Mammy," as the black servants are called, especially if they are well on in years, is actually good and tender. 

But neither are circumstances of quite the opposite wanting. The tribunals of Carolina and its better class communities have yet fresh in their memories deeds of cruelty done to house-slaves which rival the worst abominations of heathen times. Some of the very blackest of these deeds have been perpetrated by women; by women in the higher class of Charleston society! Only lately a rich planter has been condemned to two years' imprisonment in the House of Correction for barbarous treatment of a slave. And then it must be borne in mind that the public tribunal does not take cognizance of any cruelties except those that are too horrible to be passed over. When I bring forward these universally known circumstances in my arguments with the patrons and patronesses of slavery, they reply, "Even in your country, and in all countries, there are masters and mistresses who are sometimes severe to their servants." To which I reply, "But then they can leave them!" To this they have nothing to say, and look displeased.

Ah! the curse of slavery, as the common phrase goes, has fallen not merely on the black, but perhaps at this moment still more upon the white, because it has warped his sense of truth and has degraded his moral nature. The position and the treatment of the blacks, however, really improve from year to year; while the whites do not seem to advance in enlightenment. Yet I must see and hear more before I condemn them. 

From  America of the fifties: letters of Fredrika Bremer, edited by Adolph B. Benson. New York, The American-Scandinavian foundation, 1924, 79-81, 99-103.

Clinton Level of Taxes a Good thing - The "Fiscal Cliff" is Nonsense as a Metaphor

After the American Century                                                                                                                                                         

We hear every day about the "fiscal cliff" but this metaphor is all wrong. US government finances will not suddenly decline if Congress does nothing. Rather, they will increase, as the tax rate returns to what it was before Bush pushed through tax cuts that undermined the budget. People seem to have forgotten that in the Clinton years, when taxes were a bit higher, the economy did extremely well. The US at that tax level still had lower taxes than almost anywhere else in the industrialized world.

In short, it is a good thing to go back to the tax system before Bush. The government needs to pay off its debts. The wealthy need to pay their share, again, as they did before. Americans have lost touch with fiscal reality, if they think that taxes can stay as low as they have been.

I realize many people fear that rising taxes will hurt the economy, but one has to remember the harm done by taxes so low that the government just keeps borrowing money. The interest rates are low  now, so the dangers are not as obvious as they will be when interest rates rise, as they always do.

The Bush tax cuts were not good for the American economy, and there is no reason to keep them. Short term, this may cause a slight dip in the economy, but long term, living within your means is always a good idea. The Clinton tax rates were much more realistic, and the economy then was far more sound.