Why Laissez-faire Doesn't Work Today

I find it laughable that I, on the cusp of adulthood and having only one economics class under my belt, may have more wisdom in business than a Harvard and Stanford-educated economist, who happens to be the Chairman of the Federal Reserve. I am not gloating, nor do I fancy myself wise in the areas of business and economics. Rather, I am infuriated that one with a high level of concentrated education who should know the ins and outs of economics, not only supported free trade with communist countries, but was handed the position of a Federal Reserve governor with few questions asked and little experience. Ben S. Bernanke must now suffer the consequences of being deemed an idiot, and partially carry the responsibility of leading the US into unpardonable debt. 

Once again, if it wasn't such a serious issue, it would almost be comical. Bernanke, back in the day when he was an ignorant and idealistic Fed governor, said that the problem with our economy was not that Americans spend too much money, but that foreigners save too much, namely the Chinese. 

Well, Bernanke, unfortunately when it comes to economics, it's not all warm and fuzzy, and not everyone is the good guy. We aren't righteous in our spending and China is at fault for much more than frugality . With the approval of Bernanke and the Federal Reserve, China has invested approximately $1 TRILLION  in our government bonds and mortgage debt, in the manufacturing of [cheap] exports, and in lending money to the US at a very low rate (not only is this dangerous for our pocketbooks, but at any point, the foreign lenders could withdraw their money, and exponentially lower the global value of the American dollar. Financially, we should be slaves to China. And what has America been up to during China's great age of investment? Spending and borrowing abroad for consumption; bingeing on consumerism. And now, we face the colossal headache of economic hangover.

This idea of free market or "laissez-faire", translated to "hands-off",  doesn't work today because of the mindsets of the buyers and sellers. While Americans, the buyers, continue to cling to the false assumption that the US is still #1 (check it out: value of US dollar), and will blame all financial shortcomings on the government, and China, opposite on the spectrum, views our ignorance and unwillingness to take personal responsibility as a great financial opportunity, and will take advantage. The free market doesn't work because people are people. Some are ignorant, greedy, some unwise and some shrewd. People left to themselves will somehow always create chaos. That is why we, as Americans, need guidance, that is why we have a government. One definition of "govern", according to the Merridian-Webster Dictionary: "to rule without sovereign power and usually without having the authority to determine basic policy." Government is NOT responsible for all of our economic shortcomings. So why do I chastise Bernanke? Maybe his own words (after admitting to the damage caused by the United States' affair with "laissez-faire") will help explain. 

“Achieving a better balance of international capital flows early on could have significantly reduced the risks to the financial system. However, this could only have been done through international cooperation, not by the United States alone. The problem was recognized, but sufficient international cooperation was not forthcoming.”

While it's obvious that international capital flow requires international cooperation, Bernanke yet again fails to see the US citizens' fault, which I thought was unabashedly, crystal clear as well. 

Since we are in the middle of this economic maelstrom, we can shore up our economy by cleaning up our act. Here is my observant advice:

American Citizens: STOP acting like bratty, spoiled rotten children! The government officials are not our parents, we vote them into office to guide us, not to take responsibility for our childish and ignorant antics. STOP BUYING ON THE MARGIN!!!! If you don't have the money, don't spend it. It didn't work in the 1920s, and it isn't working now. Both instances have brought on economic depression, so we should learn from our mistakes and consume responsibly. 

US Government: STOP treating us like your babies. Don't assume our responsibility. We need to learn from our mistakes, so let us know when we are at fault. No one likes the parents who defend their children despite their debauchery, so quit acting like them (by the way, you are not the parents of the US). And STOP trusting communist leaders. 

Sources: 

http://www.nytimes.com/2008/12/26/world/asia/26addiction.html

http://www.federalreserve.gov/aboutthefed/bios/board/bernanke.html

http://useconomy.about.com/od/tradepolicy/p/Dollar_Value.html

Colbert Nation

I have recently become infatuated with "The Colbert Report", featuring political satirist Stephen Colbert. He is pure brilliance, he is incredibly humorous, he is blunt, and he is still somehow incredibly classy. His only downfall is that he is married, and not to me.

Stephen Colbert first became part of the regular media diet in 1997, when he became a correspondent on Comedy Central's "The Daily Show". Yet,  after several years on the show, he gained a following and chose to leave to host "The Colbert Report", which has become enormously popular among young adults. 

As I mentioned before, Colbert is brilliant and funny, and downright sexy. I encourage all to pick up his audiobook, I am America, and So Can You. 

Visit the Stephen Colbert for President Blog for Colbert quotes. 

Amazing.

Youth of the Nation

Two weeks ago, a phenomenal occurrence took place in the US, as Americans elected their first African American president. Barack Obama, the 47-year-old president elect, has brought a fresh and exciting face to politics. After witnessing the outstanding difference in the final election poll, according to CNN 53% for Obama to 46% for McCain, many, including myself, wonder what caused such a rift in the voting trends. What age group or demographic helped to make Obama's plea for change a reality in our nation. . 

"While overall Democratic turnout jumped 90%, the number of young Democrats participating soared 135%," states an article on Time.com. Thistrend leads to further questions. How did Obama win the votes of the younger population?

Barack Obama, in the young voters' opinion, has the expertise and wisdom of a distinguished politician, the heart of a human rights activist, and the glamour of a celebrity. Even I, who fell into the 23% bracket of those who did not support him, find Obama to be very appealing and heartfelt. But this is only on the surface. 

Hollywood always goes for the Democratic Party candidate. I believe the majority of the exposure young adults have to politics is through the mainstream media, or Hollywood. Meriting nearly 14 million views on Youtube.com, Will.i.am's "Yes We Can" ,a music video, features a handful of popular celebrities supporting the Obama campaign. 

The media plays a huge role in the voting trends of the average American, especially young adults. This is because the media tends to gravitate toward the more progressive, more liberal candidate. Young adults eat up whatever the media, or their idolized celebrity will throw them when it comes to political opinion. In the past eight years, this trend has become apparent, according to CIRCLE.

In my opinion, this is pure ignorance.

While Obama promises change and progress to our failing economy, he also promises other kinds of change. According to americandaily.com, Obama supports the Freedom of Choice Act, and plans for this bill to be the first he passes after his inauguration. The FOCA bill will not only make abortion legal for minors without parental consent or notification, it also will legalize infanticide. Infanticide goes one shocking step further than partial birth abortion, allowing pregnant women to inject poison into their unborn child within hours of giving birth, and then leave it to die after it has been born. The FOCA bill is radical, and very few strong liberals support it.

I believe only a small margin of the youth actually understand what Obama stands for. What most my age see is his compassion for the lower class, his plan to end the war in Iraq, and his love for hip hop and rap. In these ways, he can relate to the younger generation. 

Most media outlets give only what they want their consumers to see, and, much to my chagrin, this is the only information voters my age consider when going to the voting polls. There is an imbalance of blatantly liberal and conservative media outlets. While FoxNews and Clear Channel Communications tend to be more conservative, ABC, NBC, MTV, and many TV and magazine producers tend to be more liberal. 

I would advise my generation to actually research future candidates and find for themselves what issues they feel convinced to support. An easy and unbiased way to do this is to look at the candidates' policies on ontheissues.org. This site allows viewers to easily find what policies each candidate supports, and gives links to corroborate the findings. 

My hope is that my generation will be a little more proactive in the future, and actually seek out a politician, rather than let the politician seek them out. 

 

Social Security

We are selfish. I'm fairly certain that most have heard that if Americans used the money they spend on ice cream to give the impoverished, world hunger would be eliminated. This is merely one example. Americans love their money, career, leisure.  We do what we can to maintain these constants in our lives.

We complain that 15.3 % of our taxes go to Social Security, a number that will continue to rise as the average age of our population rises. I find it incredibly vexatious that we as a nation gripe about how the government continues to boost the amount of money we as taxpayers give to Social Security and Medicare. It's almost comical: we put our parents and grandparents into homes and expect that with a little bit of money and biannual visits, the nuisance and responsibility of caring for them will be taken care of.

We should take a cue from other countries; India views its elderly as venerable, respected. The older relatives live with their younger family members who care for and nurture them. This mirrors the kind of fostering these now elderly people gave to their children as infants.

If we saw our senior relatives as worthy of great respect and love, would we put them into retirement homes and expect that their monthly Social Security check will provide their every need?

Personally, I feel that the United States should care for its elderly as India does. If people saw more worth in their elderly relatives, perhaps we would give more than the 15.3% we are required ( forced) to pay. It should be integral that we sacrifice for our elderly the same kind of sacrifice they gave to us as children. Rather than cram senior citizens into retirement homes, we should take them into our homes. Instead of reluctantly giving the required tax money toward elderly health care, we should graciously aid our older relatives transition into their most vulnerable stage of life. 

If we as a nation could end world hunger by donating our ice cream money, think of what we could do if we genuinely invested in our elderly.