Wednesday, October 12, 2016

The Boomers Have Wrecked the Economy and they Have no Solutions to Fix It

I have to agree with this sentiment.
That’s the whole problem. Clinton relates to the middle class of the past, not the middle class or middle-class aspirants of today. No wonder her entire economic plan comes straight from a stale 20th-century playbook: raise taxes, spend more building roads and bridges, provide more government subsidies for college students and a bunch of other worthies. Completely missing from her plan: any ideas about how to more broadly spread the massive wealth being created by digital innovation. Clinton is a candidate who probably doesn’t know how most of the apps on her smartphone work.
Yeah the Clinton plan is to tax more and build some roads and bridges and hope for the best. Then you rope more kids into the college assembly line that starts them off deep in debt without the skills to compete with the Red Chinese and the Indians. The so-called college industrial complex. Then we have Trump:
Those jobs Trump wants to bring back are for lower-skilled workers once able to earn a decent living from manual labor alone. The economy doesn’t work like that anymore. Instead of “bringing back” jobs that are at the bottom of the economic food chain, what we need is a whole new training paradigm that prepares high school grads for advanced manufacturing, skilled trades and technical jobs likely to require specialized knowledge. Kids need to learn math from the first day they step into a classroom instead of taking remedial courses in community college because they suddenly realize it might be important. By promising that new unskilled manufacturing jobs will somehow materialize and help rebuild the middle class, Trump is basically saying he can return American to some kind of pre-digital paradise that must be the way he imagines the old manufacturing economy of the 1980s. It will never happen. Trump obviously knows how to use Twitter, but his understanding of the broader economy is analog, not digital.
The problem with the manufacturing economy is robots will eventually do almost all of it. Those low-skilled jobs will come back to America and Siri and Alexa and the robots will be ready to do them. The idea that we can go back to a bunch of blue collar workers on an assembly-line by raising tariffs is idiotic. The only jobs available will be the guy that programs the robots and repairs them when they break. Both are very high skill jobs that the present paradigm is unable to train properly. Then we have this fact.
The last two boomer presidents, George W. Bush and Barack Obama, contributed to the current malaise by adding roughly $14 trillion to the national debt ($6.1 trillion under Bush and $8.3 trillion under Obama). Bush tried to stimulate the economy with tax cuts, an old supply-side scheme popularized under President Ronald Reagan in the 1980s. Bush left office in 2009 amid the worst recession since the 1930s. Obama dealt with that recession through traditional stimulus spending first prescribed by economist John Maynard Keynes in the 1930s. Many of Obama’s other ideas are similar to those of Clinton’s—spend taxpayer money on new programs to help the disenfranchised. Hey, it worked in the 1960s.
Then we have trillions in unfunded liabilities that will only go higher as more and more Boomers start to get on the Social Security and Medicare rolls. So they stuck future generations with $14 trillion in extra debt (who knows what Hillary will add to this number) and we get to pay like crazy for all of this. I am counting the days until calf raises, collagen injections, and face lifts are covered by Medicare.   


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