Tuesday, November 8, 2016

Election Malaise - Economic Madness

This has to be the worst election in US history.  Virtually no real issues about policy surfaced in this nightmare of personal attacks and flawed candidates.

So, what are the economic issues?

There is one central, overriding issue, that didn't really get discussed in the campaign -- the economy.  The absence of economic growth in the US and in the western countries generally is the biggest and most important issue in the modern world.

Since the 1850s, economic growth has transformed the world and created a gigantic middle class in every developed country in the world.  Since the 1990s, this growth has stumbled and finally halted.  Absence of economic growth is the source of most of the incredible discontent that is reflected in the campaigns of Bernie Sanders and Donald Trump.

Economic growth and free markets are the essential ingredients of a society that wants even the poorest and most dispossesed citizens to have a chance.  Take away growth and free markets and only political influence will reign.  If you know the right people, then you have a chance.  Otherwise you are condemned to declining opportunities and living standards and progressively poorer government institutions, such as schools, hospitals, and legal structures.  That's where we are.

Americans have no faith in the future.  It shows up in every poll.  Debates about inequalities and injustices dominate the conversation.  Why?  Because the economic pie doesn't grow any longer and it is increasingly clear that the pie will not grow in the future.  So, let's fight over it now.

Nothing changes this, but economic growth.  That won't happen regardless of who wins the election without a sea-change in the attitude of our citizens toward free markets.  Support for the minimum wage is a clear indicator of the current cultural antagonism against free markets.  Free markets are the only hope for people at the bottom of the economic pile.  The elite will never, willingly, surrender their hegemony, no matter how many promises they make.

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