In the old days, doctors bled their patients, thinking that by decreasing the amount of blood in a person's body, the diseases in the blood would disappear and the patient would be cured. A lot of patients died as a result - at the hands of their doctors.
In astronomy and physical sciences, a lot of changes have come about, and the thinking has changed substantially. In almost every field of human endeavor, great earth-shaking changes have taken place over the years. Except in Economics. A lot of very influential people still insist that the world's economies (note that I did not say "world economy" because I do not believe that there is such a thing as a world economy) do best when people are left alone to do what is best for society. Highly educated people still believe that there is an "invisible hand" that guides people to do the right thing in nearly all instances. Such highly educated people keep insisting, despite a whole host of evidence to the contrary, that the markets must be trusted in nearly all cases. Well, what do we now know? Left to their own devices, business planners, CEOs, economists who work for the CEOs, have managed to transfer a significant volume of the world's wealth and manufacturing work to China and other developing countries, all in the name of cheap goods. They can't seem to grasp the notion that governments must step in to protect their vital industries, especially the manufacturing industries, because those are the ones that keep their people employed. Today, nearly every economist is in part on China's payroll, and they're all crying that the government must not intervene. So the Sinozisation of the world continues. China is on track to be the manufacturer for the whole world, while we in the industrialized world are on track to become Walmart employees after the successful Walmartization of America and the rest of the industrialized world. I have written in my blog (us-consumer.com) about the rise of Employnomics, Employment Economics, which posits that in today's complex universe, employment stability must be the goal of every economy, not cheap prices. Cheap prices, to a lot of economists, is synonymous with efficient use of capital and labor. The cheaper the prices, these economists hold, the more efficient the world's economies. A lot of crap! Prices of goods from China are cheap because the Chinese 1) manipulate their currency; 2) manufacture in sweat shops; 3) employ abused children; 4) do not spend anything on environmental protection and cleanup; 5) overwork and underpay their manufacturing workers to the point that the workers jump out of windows to their death, which is their only hope of escaping their wretched existence. With the Chinese heavy-handedly managing the Chinese economy and its manufacturing processes, we American and European fools continue to claim that the markets are functioning freely. The Chinese government is the most important player in its economy, while in the U.S. economy and most economies of the free world, the most important players are the fat cats and CEOs. No wonder the gap between the rich and super-rich on one hand and the working poor and hapless middle class on the other continues to widen. Since I am not a mathematician but an idea man, I don't claim to have a mathematical model for Employnomics, but I'm sure some day someone will come along to construct one. We have to worry about employment. Most of the young people in the free world are entering the labor market without any real prospects for finding meaningful jobs. A big reason for this is the loss of manufacturing jobs to China and other countries. If this were a temporary aberration, we could overlook this. But since it is a long-term nearly permanent problem, governments must step in and stop the madness. Governments must move to bring manufacturing back to their countries. To hell with Friedman and his acolytes! C On Sun, Feb 9, 2014 at 6:31 AM, <[email protected]> wrote: > > > From what little I know ... > > Friedman opposed Keynes, Samuelson, and Galbraith. > > Krugman criticized Friedman: > http://en.wikipedia.org/wiki/Milton_Friedman > x- > After Friedman's death in 2006, > Keynesian<http://en.wikipedia.org/wiki/Keynesian_economics> Nobel > laureate<http://en.wikipedia.org/wiki/Nobel_Memorial_Prize_in_Economic_Sciences> > Paul > Krugman <http://en.wikipedia.org/wiki/Paul_Krugman> praised Friedman as a > "great economist and a great man," and acknowledged his many, widely > accepted contributions to empirical economics. But Krugman criticized > Friedman, writing that "he slipped all too easily into claiming both that > markets always work and that only markets work. It's extremely hard to find > cases in which Friedman acknowledged the possibility that markets could go > wrong, or that government intervention could serve a useful > purpose."[92]<http://en.wikipedia.org/wiki/Milton_Friedman#cite_note-Krugman-NYRB-92> > -x > > Having an idea of where Krugman comes from (and who his fans at WFA are), > I tend to think Friedman right. > > A December 2008 article I came upon just a few minutes ago: > There's No Pain-Free Cure for > Recession<http://online.wsj.com/article/SB123033898448336541.html>- Peter > Schiff, Wall Street Journal > x-- > ... > Taking the theories of economist John Maynard Keynes as gospel, our most > highly respected contemporary economists imagine a complex world in which > economics at the personal, corporate and municipal levels are governed by > laws far different from those in effect at the national level. > > Individuals, companies or cities with heavy debt and shrinking revenues > instinctively know that they must reduce spending, tighten their belts, pay > down debt and live within their means. But it is axiomatic in Keynesianism > that national governments can create and sustain economic activity by > injecting printed money into the financial system. In their view, absent > the stimuli of the New Deal and World War II, the Depression would never > have ended. > > On a gut level, we have a hard time with this concept. There is a vague > sense of smoke and mirrors, of something being magically created out of > nothing. 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