Government is not hurting the economy – service economy it’s hurting itself

The Washington Post article by Ezra Klein, “Government is hurting the economy – by spending too little“, brought to my attention by my friend Michael, attempts to convince us that the government spending is the key to the robust economy. The statistics seem to work in Mr. Klein’s favor. The government spends less, the economy dunks.

Source: Der Spiegel 5/11/12

We all know, the statistical data can be interpreted in dozen different ways. One obvious conclusion from this article is the increased dependence of the service economy on the government spending. Just take a look at the Der Spiegel graph showing the correlation between the national debt, manufacturing jobs, and foreign trade deficit. Loosing well-paying factory jobs leads to an increasingly unstable service economy.

Want a proof? Why would a real estate bubble affect the US economy in such a devastating way? No, it’s not because of the foreclosures but because of the lost construction jobs in both residential and commercial markets. Housebuilding is one of the last, true manufacturing niches that remain in the US. Of course, until, someone in China develops an inexpensive way to build modular homes and ship them with ready-to-assemble manuals.

The basic foundation of Mr. Klein’s article if simply misleading. How is the “government” founded? Government this and government that. Government would not exist without OUR money. So really, we are already spending the money and helping the economy, except, in the confiscatory manner.

Is the private sector without a fault? Of course not! shipping thousands of jobs abroad to raise profits for selected few, killed the internal balance of making and spending money by the middle class (if such still exist). Service economy will never be able to fill the gap left by the heavy industry.

US government to the rescue. The interconnected paths of the private and government spending is becoming more and more important to the economy. With the federal government spending our money in every possible way, no wonder private companies look up to the mighty uncle Sam to throw them a bone. Cash for clunkers anyone? Electric vehicle credits? Military contracts? Shovel-ready jobs? Everyone jumps on those government contracts.

So the real question is, how can US survive without the artificial government spending? The larger slice of the economy is overtaken by the government, the more risky the economy becomes. PIIGS countries anyone?
Unfortunately, once the government starts growing without a control, going back is almost impossible without an unpopular and devastating cuts. By the same token, there is a limit of taxation by the government. How much tax confiscation will take for people to revolt? Learning from Gerard Depardieu and Nicolas Sarkozy, about 75%.

Finally, I would read Mr. Klein’s post as a warning and a lesson. If we continue to depend on the government spending, let’s just nationalize the economy and stop pretending that our current system is a pure capitalistic ever-profit-giving golden goose. Perhaps Mr. Obama should put aside the popular replacement issues (healthcare, immigration) and concentrate on what’s the most important at the time – our wallets.

Manti Te’O: Top 10 list of new names

Story of the Notre Dame Fighting Irish linebacker Manti Te’O (MAN-tie TAY-oh) fake girlfriend, Lennay Kekua (leh-NAY kay-KOO-ah), took over the American media like an undocumented immigrant taking over roofing jobs in Chicago.  Of course, we don’t buy his explanation of a practical joke orchestrated by his “friend” Ronaiah Tuiasosopo (roan-EYE-ah Too-eee-ah-suh-SO-po).

Those pesky Hawaiians have their revenge for taking over Hawaii by the United States in 1893 and overthrowing Queen Liliʻuokalani, born Lydia Liliʻu Loloku Walania Wewehi Kamakaʻeha. Easy for you to pronounce it. Ha.

Obviously, Manti had high hopes for boosting his career. The near future will show if NFL turns a blind eye on this dent in his resume.

Oh, screw waiting, yes, the guy will make ton of money and he will laugh all the way to his gold plated ATM in his new Lamborghini. There.

In case Manti Te’O needs to change his name to accelerate his career ever further, here’s the top 10 list of new names.

1. Wrongtie Yell’O
2. Lanai Spray’O
3. Manshy Hands’O
4. Taipei Pa’O
5. Gentile Tov’O
6. Meatpie Beat’O
7. Turdfly Lam’O
8. Moontie YoYo
9. Mantie Thong’O
10. Bowtie Telltal’e

Gun debate served on a gun sandwich

After all the shootings and the outraged public, president Obama decided to take action signing 23 executive orders to curb gun violence. See the White House list below:

1. Issue a Presidential Memorandum to require federal agencies to make relevant data available to the federal background check system.

2. Address unnecessary legal barriers, particularly relating to the Health Insurance Portability and Accountability Act, that may prevent states from making information available to the background check system.

3. Improve incentives for states to share information with the background check system.

4. Direct the Attorney General to review categories of individuals prohibited from having a gun to make sure dangerous people are not slipping through the cracks.

5. Propose rulemaking to give law enforcement the ability to run a full background check on an individual before returning a seized gun.

6. Publish a letter from ATF to federally licensed gun dealers providing guidance on how to run background checks for private sellers.

7. Launch a national safe and responsible gun ownership campaign.

8. Review safety standards for gun locks and gun safes (Consumer Product Safety Commission).

9. Issue a Presidential Memorandum to require federal law enforcement to trace guns recovered in criminal investigations.

10. Release a DOJ report analyzing information on lost and stolen guns and make it widely available to law enforcement.

11. Nominate an ATF director.

12. Provide law enforcement, first responders, and school officials with proper training for active shooter situations.

13. Maximize enforcement efforts to prevent gun violence and prosecute gun crime.

14. Issue a Presidential Memorandum directing the Centers for Disease Control to research the causes and prevention of gun violence.

15. Direct the Attorney General to issue a report on the availability and most effective use of new gun safety technologies and challenge the private sector to develop innovative technologies.

16. Clarify that the Affordable Care Act does not prohibit doctors asking their patients about guns in their homes.

17. Release a letter to health care providers clarifying that no federal law prohibits them from reporting threats of violence to law enforcement authorities.

18. Provide incentives for schools to hire school resource officers.

19. Develop model emergency response plans for schools, houses of worship and institutions of higher education.

20. Release a letter to state health officials clarifying the scope of mental health services that Medicaid plans must cover.

21. Finalize regulations clarifying essential health benefits and parity requirements within ACA exchanges.

22. Commit to finalizing mental health parity regulations.

23. Launch a national dialogue led by Secretaries Sebelius and Duncan on mental health.

As responsible adults, we can all agree that those are very important changes dealing with the increasing gun violence. However, the core of the shootings and killings are committed by criminals. Yes South Side Chicago, that's you as well. 

With all those knee-jerk laws dealing with a long overdue problems, those executive orders are essentially worthless. 

Why? Because with 270,000,000 private weapons in the United States (www.gunpolicy.org), the real issue behind the gun violence is the criminal underground. And what criminals do? Yes, they don't care about any laws. 

Let me illustrate this UberNibbler style with the gun sandwich. Usually, the general population responds better to visual aids. So bite on this.

As you can see, the legal gun owners are the squeezed cheese and the crazies are a baloney. So you can issue as many executive orders or new laws as you want – they won’t solve the problem. BTW, Congress, get to work already. Enough with the party line this and party line that nonsense. We are the people and we demand real actions from the Congress and the States. Get to the bottom of the violence: poor areas, uneducated people, lack of jobs, lack of support, single-parent families. Heal the society and you will disarm the violence. 

Like what you see? Spread the sandwich. Where’s Jared Fogle when you need him?