Mars Man’s TV – Economy Stupid or Stupid Economy?


 

Mars Man

Our popular show “Mother Earth’s Weekly Squirms” was on  Mars City TV to discuss the results of the USA 2010 mid-term elections.

“No surprises in the USA,” I said, opening the talks. “It was in the cards for many months. The Pied Piper got a good shaking down. He says he was not on the ballot but he clearly was. It’s the first time in a long time that mid-term local elections became national indeed. The majority of the American electorate said it rejects socialism. Shamus, tell us, was it what they call the economy stupid that broke the back of the President and his obstinate Democrats?”

“It was the stupid economy,” Shamus said coolly. “Because it does not want to do what the politicians want.”

“But don’t politicians know that?” I asked. “After all, they’re supposedly intelligent people, no?” Shamus put on a learned face.

“They try whatever they can to circumvent the economic laws promising heaven and manna to keep their seat. Especially the House with its two-year cycle. When it’s not working they blame the other party or Bush.”

“I thought economics was a social science, not a manipulative device,” Pasha said.

“True, it’s exactly the opposite of a manipulative device,” Elmer said, agitated. “That’s what the socialist’s ideology wants it to be. They disregard the fact that economics responds to a system of unwritten laws and doesn’t conform to the ones their lobbyists drafted and they voted on blindly. When lawmakers ignore them, they do so at their own peril and everybody else’s when the dirt hits the fan, and it did majestically this time.”

“It’s a science all right,” Shamus pointed out, turning to Pasha, “but not like a predictable chemical formula where you know that if you mix liquids, they explode. Politicians mix their laws with your tax money, saying you would be better off if you let them do that and when you look in your wallet a year after and you wonder why it’s empty, they still want more from you saying things take time.”

“But what about these economic laws?” I asked. “Our viewers would like to know.”

“Well, to simplify,” Shamus said, “Suppose I am manufacturing cars. Demand is good and I sell a lot of them. Other carmakers do too and we employ more people to manufacture more to supply demand. People make good money and buy more stuff. Everybody’s happy. Then Mr. Obama needs money for lofty programs that make his voters feel great, and his political majority enforces higher corporate taxes on cars to pay for them. Suddenly I can’t sell them my cars any more at the price I got, have to lay-off workers and must raise prices to stay in business. Then the buyers can’t buy cars at the price they could afford and I am loaded with inventory, make losses and can’t pay the high worker salaries anymore. Then the workers go on strike and I am forced out of business. That’s the economic laws that are at play, works like gravity. But because that’s bad politics, the politicians compound their mistake of raising taxes, and use tax payer money or borrowed money from China or both to keep me afloat and buy off my debts. To pay for that they must raise taxes even more and the Central Bank must print money. Then the US dollar declines in value and makes imports more expensive in the shops, people buy less, and slowly they go down the drain in the rest of the world. Double whammy as they say in the USA. The original mistake was to raise taxes to pay for programs that are not needed or they can ill afford. You have to live within your national means, not your political dreams.”

“Simply put, a stone does not fall zig-zag in physics but in politics it does,” Elmer chuckled.

“But don’t all parties on Earth do that?” Huda asked.

“Some more than others, but socialists in particular,” Tamil said. “The more they give people the more people depend on them and when the next government has to take that away to clean up, the people get mad. Look at France. Till the whole place is in such a mess that only draconian austerity can drag you out of the hole. Look at Britain.”

“But I read over the wire that even some reputable economists support these spending policies,” Pasha wondered. “Don’t the economic laws apply to them?”

“Some economists are socialist economists,” Shamus said. “for them capitalism is the culprit. They base their assumptions on ideology and skew their assumptions in such a way that the outcomes seem right. But their assumptions are artificial. They lack a mathematical base. Socialist ideologues make everyone poor because they want to kill the human urge that wants more. With them, life gets pretty drab, except for those in power. But not all is right with the capitalist economists either. Capitalism gives incentives to the risk takers to invent, produce and make money, but then everyone goes for the same buck, the economy overheats, and the balloon bursts. They call that the business cycle. Humans are imperfect and so are their markets.

A good governor with a good team knows how to manage these ups and downs. Socialists want to get rid of the business cycle all together but throw the baby away with the bath water.”

“So, if the business cycle bursts at the same time as elections are held, as it did in 2008,” Pasha concluded, “the populace swings to the socialists for correction and when they wake up seeing the bad results, they swing to the capitalists again.”

“Exactly,” Shamus said, nodding approvingly like a university professor.

“Has anyone any views on what happens now?” I asked.

“There’s no major change in government like in Britain or even Sweden and Holland,” Elmer said, “Obama is still president and his Czars in the White House are still penning socialist policies and regulations. The main change is that his ambitious spending programs will be arrested. We will see what happens in 2012.”

“Stopping spending is the first thing the new majority must do,” Shamus said. “Confidence will return and bring people back to work and the economy will pick up again. Taxes must be kept low for at least the next five years and Obamacare must be repealed, so that businesses can plan to make a profit for a reasonable return on their money and re-employ people.”

“Why could the socialists not do that too?” Huda said, puffing in her chair. “It sounds pretty logical to me.”

“For socialists, profit’s a bad word,” Elmer explained. “They say it’s steeling from the worker, forgetting that it’s the investor who’s risking his hard earned money. They want the government to produce what everyone needs at a given price and in accordance with their regulations, and pay employers and workers a fixed wage. They forget that human beings aren’t made that way. Only dictatorships can enforce such policies. That’s why they lose at the ballot box.”

“But the huge USA deficits still burden their economy,” I said. “It will keep the recovery down. The new majority will face criticism in 2012.”

“I bet Earth’s socialists are banking on that,” Tamil said, laughing. “If it goes better, the president can say, hey, folks, you see that we are doing better after all thanks to my policies?” and if it does not he can say “hey, you see who’s been messing up again? Didn’t I tell you about the failed Bush policies? Vote for me!”

“The economic laws don’t take sides, the average voter does not understand. They vote emotionally.” Shamus said. “Despite all the warning signs hanging around his neck, people just discarded all the negatives and voted for him, regardless.”

“The Pied Piper played on that handsomely in 2007,” Pasha said. “Remember the Obama girl? She’s nowhere to be found. They just had Halloween down there. I heard she was cultivating pumpkins in Michelle Obama’s vegetable garden. Others reported she returned as a witch at that teleprompter that reportedly broke down during a speech when he lost his cool.”

“Earth was ripe for an illusion in 2007,” Huda said. “The Pied Piper played all the right tunes. Hope and change. Nobody knew what that was, just an orgy. But he did, like his cronies of the sixties whom he appointed Czars. The Presidential seal that fell down to the floor for the whole universe to see was a bad omen and a good laugh for many.”

“Former President Reagan warned about these people at his speech in 1964 at the Republican Convention, as a young supporter of Goldwater,” Elmer said. “I looked it up. His words are as right today as they were then because the same sixties people who were acting up then are now Obama’s friends, mentors and Czars or close visitors to the White House. They finally got their chance in 2007. The result? A debt burden almost as large as the USA’s gross national product. No wonder people get scared. The whole Earth is looking down on the USA.”

“Obama is off to India this week for a state visit to forget the election debacle,” Tamil said. “A country of 1.3 billion people. You imagine? A nice tax-payer paid vacation at a cost of 2.5 million dollars a day. And that with a USA deficit that sticks way out of his ears in a country where per capita income is a little over 1000 dollars a year only.”

 “The Republican Party’s euphoria may be exhilarating,” Shamus said, “but if they don’t resolve the deficit problem and perform to the wishes of their multiplex supporters, they will lose again in 2012. What’s needed is at least six years of conservative statesmanship to put their fiscal house in order, bring the deficits down and balance the budget. It all depends on who’ll be minding the store.”

“The big issue is indeed who will be their leader,” Elmer said, seriously. “If they can’t find someone who can face up to the Pied Piper and talk him under the table, God forbid, the USA will be written off for good.”

“Well,” Shamus said,” let’s not be over pessimistic. Humans on Earth have screwed up time after time but overall progress has been impressive.”

“There’s always a silver lining to Earth’s tough luck,” Pasha said, smiling. “As long as they don’t do so well financially, they won’t come visit us and spoil our way of life.”

“That’s the last word, dear panel,” I said. “Our next Round Table will be joined with Earth’s TV show Where the World Turns to discuss the fall out of the USA mid-term elections and their impact on the rest of Mother Earth. See you then.”

 

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