I don't get it. After the WW II the USA was given it all on a plate. You had a massive industry built from supply war goods. Your had no rebuilding costs to speak of. England and properly other country's handed over a lot of technology information regarding arms, which help build a huge arms industry. Many top scientists left Europe for the USA. Your population has a good work ethic and you have since gone on to be the center of academic world with some outstanding research.

But despite all this your economy if propped up by gimmick policy's and you have been technically bankrupt for year? Why? What went wrong?

Overspending beyond our means, and then, instead of fixing this, borrowing from foreign lenders and continuing to overspend and print money, weakening the US dollar and our economy as a whole.

Reagan's policies certainly had something to do with this.

The policies were derided by some as "Trickle-down economics,"[15] due to the facts that the combination of significant tax cuts and a massive increase in Cold War related defense spending caused large budget deficits,[16] the U.S. trade deficit expansion,[16] and contributed to the Savings and Loan crisis,[17] as well as the stock market crash of 1987. In order to cover new federal budget deficits, the United States borrowed heavily both domestically and abroad, raising the national debt from $700 billion to $3 trillion,[18] and the United States moved from being the world's largest international creditor to the world's largest debtor nation.[19] Reagan described the new debt as the "greatest disappointment" of his presidency.[18]

http://en.wikipedia.org/wiki/Reaganomics#Economic_Record

What we need is a Fire sale like Die Hard 4.

I don't get it. After the WW II the USA was given it all on a plate. You had a massive industry built from supply war goods. Your had no rebuilding costs to speak of. England and properly other country's handed over a lot of technology information regarding arms, which help build a huge arms industry. Many top scientists left Europe for the USA. Your population has a good work ethic and you have since gone on to be the center of academic world with some outstanding research. But despite all this your economy if propped up by gimmick policy's and you have been technically bankrupt for year? Why? What went wrong?Can you say "Paradigm Shift"? Despite having launched the computer revolution, the culture of the USA has been slow to adapt to the post-industrial era. Sure, everybody has email and iPods, but that's not a paradigm shift.

The paradigm shift of the post-industrial era is a fundamental change in how economies work.

Tangible goods are no longer the mainstay of an economy. (Much less food, in a country where obesity is the most prominent nutritional problem among its poorest people!) The new commodity is information, which breaks all the economic models. There is no "scarcity" since it can be reproduced almost for free. And there is no "ownership," since it can be duplicated despite almost all efforts to prevent it.

The industrial infrastructure which the USA has lovingly built over the past couple of centuries is--well not exactly obsolete, but let's say mature. We're not building transcontinental railroads and giant steel mills. To a lesser extent this is true worldwide: China and India are "wired" without turning their entire countries into forests of telephone poles.

These phenomena have a major impact on the evolution of our economy, and our leaders are slow to recognize it. As I've often pontificated on SciForums, we all have computers and telephones at home, which would allow about 80% of Americans (and probably 99% of SciForums members) to do their jobs at home. We could live literally anywhere, including Costa Rica or Fiji, and get our work done. Yet we are still required to "go to work" every day--largely because we have entire industries that depend on people being forced to live close to their offices and commute, such as energy, auto manufacturing, convenience food, day care, and real estate.

The entire concept of the gigantic corporation is an artifact of the Industrial Era, when huge concentrations of capital were needed for those gargantuan projects. In contrast, people today are launching efficient and profitable software firms with nothing more than their personal life savings--and moving to Estonia to do it, where taxes are low.

It's generally acknowledged that the secret to Japan's leapfrogging from a feudal society to a major industrial power was the nearly complete destruction of the country in WWII, requiring it to be rebuilt from the ground up. They imported American experts who could not get a hearing at home, and used their paradigm-busting principles to out-industrialize the USA.

Today it is the USA that is mired in industrial era economics. We have too many megacorporations controlling our political and economic policies, preventing us from rebuilding as an Information Age society.

Look at the "writers' strike" that has paralyzed the TV industry. Workers and employers are actually doing battle over such pre-industrial anachronisms as copyright protection. These are clearly people who cannot say "Paradigm Shift." Meanwhile the American people are learning to find their entertainment on the Internet--talk about irony! When the strike is over, no one under 50 will bother watching TV any more.

And look at the state of the corporate world. Corporations are not producing, they are scavenging each other's corpses.

America is not making the transition into the Information Age. I don't see any of our current crop of pathetic presidential candidates even addressing this issue knowledgeably. So I don't expect any improvement soon.

This is what is going wrong with the U.S. economy. We are much like the Southern states in the Civil War era. They were desperately trying to hold onto a storybook vision of life from the Middle Ages: an agrarian society run by aristocrats, with slaves filling the role of yeomen, since no free men were willing to fill that role. As I have often said, Lincoln should simply have let the South go. Within a generation its economy would have collapsed without industry, a good railroad network, or even power equipment for farming, and Queen Victoria would have made them an offer they could not refuse.

The USA is desperately trying to hold onto a storybook vision of life from the early 20th century: an industrial society run by capitalist barons, with happy, modestly-educated workers cheerfully consuming everything they produce, and no international problems that we couldn't solve with troops.

Very nice post Fraggle. Reminds me why Sciforums can be informative and entertaining at the same time.
What do you think will happen as the stop gap measures eventually peter out ?

To much spending on bullshit and not enough savings.

Oye Veh! Look: every decade or so, this question pops up. "What went wrong with the US economy?" It's like, people are sitting around just salivating at the prospect of a downturn. Look: it's an economy, it cycles!

This whole concept is ridiculous: the German economy has been anemic since re-unification, and the Japanese economy suffered for EVERY YEAR of the 90's. The French and Italian economies have been over-burdened by cushy public assistance for decades and yet we focus, totally, on the US economy? Huh? The US economy has its good points and bad ones: less regulation than most, much more volatility; yet far more innovative. In Europe its all about control and regulation, the benefit is that the economy is far less volatile but the consequence is much less innovation.

Look, recessions happen every six years or so. Every fracking time it happens people presage the end of the American century and bemoan its end with a litany of ways how it all went wrong. And then, something happens like in the latter of half of the 90's where the US economy ushers in an entire economic era and people begin praising "The American Way" again.

Hey, I'm not claiming that America will be the idealized land of wealth and opportunity forever, maybe not even beyond another 30 years, but this whole discussion is pointless.

I hear people talking about what's wrong with Americans as if SOMEHOW this same disease doesn't infect all western economies and that Americans aren't dealing with the change so well. Have you been to Europe? Ever see their unemployment numbers or economic growth statistics? I mean, COME ON!

Yep: there are harsh times ahead, that is part of life, but this whole six-year cycle of rebuke-to-encomium is beyond ridiculous.

~String

String the focus on the US is because it is the world largest and it is big news all over the world.

Also, I agree with you on the fact that things more in cycles. However, there are some big factors at play this time. I think most of the tricks that governments can play have run out because they have all been short term solutions. And now the US is not only bumping in billions of $ but also cutting interest rates to boost things, these are desperate times.

I think the danger this time is that even a small recession could turn big. People own to much money and they will be crippled very quickly when things go bad. The US also has huge military commitments that tie it financially. And China and India are fast taking money and jobs from the whole planet.

The balance of economic power changed a long time ago but no government wants to say to its people tomorrow we will not be poorer then today. So to stop this inevitable reality, governments have run themselves into the ground with economic policy that will cost even more in the long term.

At the end of the day the developed world will become poorer and the sooner this is accepted the better.

You're right, string. Plus the media is making this all W's fault to push their liberal agenda. :rolleyes:
I'm kind of fed up with politics now since the Hispanics threw the FL primary for McCain. Ugh...:(

Sandy what is string correct on? All he has said is that things run in cycles and that this one will be like the rest. You don't seem to understand that the World has changed since the last depression. Every depression has its own factors and they use to be local, now they are global. Thats why this one will be different.

Also the US was bailed out by other countries before. Nowadays its every man for himself.

Sandy what is string correct on? All he has said is that things run in cycles and that this one will be like the rest. You don't seem to understand that the World has changed since the last depression. Every depression has its own factors and they use to be local, now they are global. Thats why this one will be different.

This is cyclical and no surprise for those of us who understand it. There will be no recession unless a democrat takes over, raises taxes etc... We will pull out of this. We always do.

This is cyclical and no surprise for those of us who understand it. There will be no recession unless a demcrat takes over, raises taxes etc... We will pull out of this. We always do.

Blessed are the blinkered

This is cyclical and no surprise for those of us who understand it. There will be no recession unless a demcrat takes over, raises taxes etc... We will pull out of this. We always do.


The economy improved immensely under Clinton and went to shit under Bush SR.

I think most of the tricks that governments can play have run out because they have all been short term solutions. And now the US is not only bumping in billions of $ but also cutting interest rates to boost things, these are desperate times.

How old are you? I ask this not insultingly, but because I wonder how far back your memory goes (i.e. if you're under a certain age, you may not have remembered past presidents, economists, and industrialists foretelling similar things). Of course, they are all right, eventually. I can predict the future too: One day the Sun will explode! See, if you make it absolute enough and yet temporally vague enough, you're eventually right. I can remember Greenspan under Bush I on TV reacting to the "end of the American century" by slashing interest rates as a result of the downturn of the economy, housing hitting a tail-spin, and every economist and their aunt being on TV saying, "See, I told you so... this time it's different, things have changed... when will Americans wake up?" Look, I've heard it all before and I've said this also: Americans are in for a rude awakening NOT because of some inherent fault in America but because of a cancer that's growing on western economies in general and, unfortunately, where the US goes, so goes the world.

I think the danger this time is that even a small recession could turn big. People own to much money and they will be crippled very quickly when things go bad. The US also has huge military commitments that tie it financially. And China and India are fast taking money and jobs from the whole planet.

I worked for Progressive Insurance in the latter half of the 90's and Peter B. Lewis (the billionaire CEO, a staunch liberal, and supposedly brilliant economist) came to our campus in Tempe, AZ and was talking to us about how the next recession would probably be the biggest one since '29 and how much the world was different from the last recession and how Americans needed to change their ways. He's right. You're right. But the obvious answer is, "Well duh!" Every recession is different and every recession is brought on by different circumstances which occur because things have changed. That's a fact and stating it is like stating "hey, today is different: I'm going to eat sushi!" Yes, well you certainly did something different, but it really ain't all that different.

The balance of economic power changed a long time ago but no government wants to say to its people tomorrow we will not be poorer then today. So to stop this inevitable reality, governments have run themselves into the ground with economic policy that will cost even more in the long term.

I couldn't agree more or have said it better myself. But, as you say, this isn't an American issue, it's a global one.

At the end of the day the developed world will become poorer and the sooner this is accepted the better.

For a time... until things change... and then they'll be different.

Also the US was bailed out by other countries before. Nowadays its every man for himself.

Actually it was the American capital engine that pulled the Japanese and Europeans out of their last recession, it had gotten so bad that they just basically gave up trying to pull their economies out of the gutter until the American one improved and pulled them out along with it. And let's not forget who's buying all those Chinese, Korean and Indian widgets that keep those economies chugging along!

~String

the German economy has been anemic since re-unification, and the Japanese economy suffered for EVERY YEAR of the 90's.

German unification is like America taking Mexico. Imagine where would Americo's economy be! And if you ask me, we will repeat what happened to the Japanese, thus a good 10 years of stagnation and sideways movement....

And cycles are fine as long as there aren't such a huge ups and downs....

This is cyclical and no surprise for those of us who understand it. There will be no recession unless a demcrat takes over, raises taxes etc... We will pull out of this. We always do.

Sandy is in favor of raising taxes to pay for her pet issues, like deporting illegal immigrants. I wonder if she is also in favor of raising taxes to pay for the war in Iraq as well. You can't just borrow and not pay back. What has been missing since Reagan is using our tax dollars to invest in America, the infrastructure we need, the education we need, the social services that help people achieve middle class and so start paying back into the system. Economic collapse is not inevitable.

What has been missing since Reagan is using our tax dollars to invest in America, the infrastructure we need, the education we need, the social services that help people achieve middle class and so start paying back into the system. Economic collapse is not inevitable.

A good point. Lots of pork and pointless foreign adventures, yet little domestically for Americans. Silly... no, sad.

~String

At least pork keeps the money in the US. Foriegn adventures are a total waste.

History is just repeating itself.

Local and state elections were held in the United States in late 1966. The war in Vietnam had an effect on those elections. The opposition Republican Party generally supported the President's war efforts. Yet it criticized him and other Democrats for economic problems linked to the war. The war cost two-thousand-million dollars every month.The price of many goods in the United States began to rise. The value of the dollar began to drop. The result was inflation. Then economic activity slowed, and the result was recession.

Hello!

http://www.globalsecurity.org/military/ops/vietnam.htm

I think you answered your own question already, in the title.. :p

History is just repeating itself.

Hello!

http://www.globalsecurity.org/military/ops/vietnam.htm

Looking at the numbers, the war is a pretty small amount of our expenditure. It's a waste and should be ended asap, but there are other factors at play.