Forum Post: one person's view from his 1% perch - part 2

In part 1, I gave what I think are the symptoms of the problems we have. Here are what I think are the root causes of our economic and political problems:

ROOT CAUSES:

1. Why have we taken such a large step backward on so many important dimensions for a modern society? If we were to go back to 1980, surely people from all sides of the political spectrum would want something better for our country? Surely, if government and business leaders were looking to the future, this is not the one they would have picked. No one wants 85% of people hating them like the public hates politicians and wall street titans. So, how do you end up in an awful place that anyone with any sense would plan to avoid?

The answer to this paradox is simple – those decision makers simply did not make their decisions based on the long-term results of their policies. Quarterly profits for business. The next news cycle for politics – these became the real drivers of policy, blocking out any rational long-term view we need from our leaders. If you plan only for the short term, you are very likely to end up in a bad place in the long term.

A typical example of short-term thinking is the decision by corporate America to start offshoring jobs in large numbers during this period. How can it possibly make sense to undermine your primary consumer base to save a little on operating costs? Even those cost savings are probably an illusion. I personally tried to start a business to convert jobs to work-at-home ones in America for much less than offshoring to India, but corporate America had already given up on Americans for much of its work force. Another fact many people don’t know is that Adam Smith, the father of Capitalism, coined the term “the invisible hand of capitalism” to indicate the need for capitalists to choose local labor over apparently cheaper foreign labor, and he wrote that hundreds of years ago. Guess we lost that wisdom.

Why do our leaders focus so much on the short term? I could lead you through some tortured analyses, but at one level its very simple – they’re simply doing what we’re asking them to do. Huh? Say again. Let me demonstrate by example: how many of you shop at Walmart to save a few dollars instead of that local market that’s probably out of business by now? Buying decisions made purely on economic terms will inevitably result in large scale entities whose connection to its customers’ lives is a shallow reminder of the relationship offered by a smaller, local entity.

Second example: the Republicans won big in 2010 only because of the bad economy, even though the state of the economy was clearly the Republicans fault by any rational analysis. Again, WTF? This paradox happened because President Obama felt the need to promise an unrealistic level of short-term improvement from a very limited stimulus program to try and cure economic fault lines that took decades to form. He never had a chance on delivering on that promise. I’m not sure why he made it as he was already elected, unless he thought he needed to put the economy behind him to get to health care.

When you come to recognize the problem you will come to recognize the solution. Ayn Rand was wrong, greed is not a virtue.

1. Due to a lack of restraints on industry concentration and lax enforcement of other key regulations, economic and political power has been concentrated in a few individuals in opposition to popular policies. Examples: • Citizens United ruling giving corporations status as people with First Amendment rights– Romney didn’t make that up – companies are people right now. • Medical Marijuana – big Pharma has cleared the way to take over despite growing evidence that botany-based decentralized approaches to refining the medication may have more promise than chemical approaches cooked up in Pharma labs.

2. Powerful forms of propaganda that blind the inattentive person to what’s going on behind the curtain. Everyone should watch some Fox News – they really are very good at propaganda. Talk radio continues to exaggerate and enhance and the divide between poor and middle class conservative whites and less conservative people of all colors at the same income levels. I’d also point out that MSNBC is also a propaganda outfit, albeit a little more balanced than the other side.