Category Archives: Economy

UPDATED: Decoding The Plan to Make Detroit Work (Blame Honky)

Africa, Debt, Economy, Federalism, Government, Intelligence, Race, Racism, Socialism, Taxation

If these minority penalizing budgetary cuts were inflicted in New Hampshire, Desiree Cooper of Detroit Public TV would have probably cried foul. But they aren’t, so Cooper keeps her cool in an excellent factual account about Detroit’s black-dominated city council, and its efforts to save the city’s finances by consolidating services. (Read: directing these to those who PAY.)

This invariably means directing services to the dwindling tax base (You Know Who), so that this productive, paying minority gets the best bang for its huge outlays and goodwill and… STAYS IN TOWN. These good people want to remain in the city they helped build.

Have their overlords realized, perhaps a little late in the day, that keeping the taxpayers who pay their salaries happy might just be the key to their own statist status? As Cooper puts it in this remarkably impartial report: It is these “dedicated Detroiters, the more affluent Detroiters who are part of the tax base [that] the city desperately wants to hold on to.”

Barbara and Spencer Barefield are an example. The couple has “what they consider a small house amongst Palmer Woods’ mansions.” They (and their ilk; nudge-nudge) will be accorded “preferential treatment in this community’s upkeep, maintaining roads, sidewalks and streetlights. That could mean the difference between residents staying or leaving.”

Of course, it is a travesty to frame as “preferential” the provision of basic services in return for enormous outlays. It shows you how far we have gone in assimilating Karl Marx’s maxim, “From each according to his ability, to each according to his need.”

The Barefield are Detroiters of quite a deep dye, as they are prepared to put up with a $900-a-month utility bill!

READ MORE about the “Detroit Works” project, undertaken by Mayor Dave Bing and his crew—architect Rainy Hamilton, Karla Henderson who heads Detroit Works, City Council President Charles Pugh, and others—in an attempt to save the city (and their sinecures?):

With a sprawling city, 139 square miles, and few resources for city services, Mayor Bing took the Detroit Works project as an opportunity to redefine the city’s physical, economic and social landscape. He began by taking inventory, taking a close look at what Detroit really has.
Demographers have identified at least 100 distinct neighborhoods within the city limits. With that in mind, Detroit Works unveiled its short-term plan, classifying the city’s neighborhoods by their quality of housing and stability of population.
The degree of city services and investment would depend on whether the neighborhood is deemed steady, transitional, or distressed.

UPDATE (Dec. 13): Erik in the comment below blames honky in what sounds like vintage Yankee propaganda. You’ll get better historical facts about the South from reading or watching the brilliant timeless “Gone with the Wind.” So too did Mencken write about the civilization destroyed by the “dirty Yankees.” The South was the seat of the country’s aristocracy—and some of the finest families in America.

Although my book, Into the Cannibal’s Pot, advances the cultural argument in explaining underdevelopment, it is also highly critical of it. As follows:

In “Into the Cannibal’s Pot,” I concur to an extent with thinkers such as Etounga-Manguelle. Indubitably, in Africa “magic wins out over reason; community over individual; communal ownership over private property; force and coercion over rights and responsibilities; wealth distribution over its accumulation.”Indeed, human behavior is mediated by values. However, I criticize the cultural argument for “affording a circular, rather than a causal, elegance: people do the things they do because they are who they are and have a history of being that way.”
But “why have some people produced Confucian and Anglo-Protestant ethics—with their mutual emphasis on graft and delayed gratification—while others have midwived Islamic and animistic values, emphasizing conformity, consensus, and control? Why have certain patterns of thought and action come to typify certain people in the first place?” Such an investigation, I conclude, political correctness prohibits.
In any event, bad leaders or bad weather patterns are not what shackle backward peoples. Not exclusively. As cities across England burn because of the “unequal civilizing potential” of certain peoples—James Burnham’s coinage—it has become clear that the values and cultural influences which people (and peoples) bring to the polity cannot be tweaked out of existence like some unsightly nose-hair.

Read it, Erik. Mimicking whitey, if that is indeed your and Sowell’s explanation for black dysfunction, falls flat when it comes to Africa.

Job Crushers

Business, Economy, Labor, Political Economy, Politics

Trust the public broadcaster to report the facts in detail and accompany them with transcripts. High marks for that PBS service. However, the service comes with a high price: full-on Keynesian propaganda. PBS’s jobs report begins in the Volunteer State (Tennessee), with an employer who understands that the cost of doing business is increased with every little regulatory tweak issued in DC. Says Bobby Joslin of “Joslin and Son Signs”:

“Well, two years ago, three years ago, we had to have all our tow motor people certified to operate a tow motor. … A forklift. And that cost the company $3,600. Now we’re having to dispose of all our lightbulbs. We’re in the sign business. We create a lot of volume of fluorescent tubes. So we just got through spending $8,500 on a lightbulb crusher.

Then there’s “Obamacare. When we bring on a new employee, we don’t know what that employee truly is going to cost us in 2014. And we’re not in the practice of hiring people and then laying them off.”

But our intrepid PBS reporter can recognize a Republican ruse when he hears one. PAUL SOLMAN thinks the small businessman he just interviewed is one dim bulb. Solman editorializes as follows: “Uncertainty of taxes and regulation crippling job creation; it’s become a Republican talking point.”

According to such Keynesians, who have always struggled with the chicken or the egg problem, business is struggling because, well, because it is struggling:

“Joslin told us business is down 35 percent over the past three years. So of demand is the other reason you’re not hiring, right? … lack of demand is the other reason you’re not hiring, right? But if sales drive everything, how important can policy uncertainty be?”

There is always an expert on hand to expatiate about the mysterious cycle of poverty that starts with reduced demand, and has absolutely nothing to do with the Brownian motion of the DC wealth-consuming machine:

And every businessman I know says exactly that. Non-financial companies are sitting on over $3 trillion of cash, the latest IRS data shows. Companies are not investing that money because there’s no demand. It’s not because they’re concerned that tax rates may go up or regulations may change. They need to have people and businesses with money to spend in order to invest.

[More about Voodoo economics here.]

Save the People; Fail the EU

Economy, EU, Europe, Federal Reserve Bank, Foreign Policy, Free Markets, Iran, Political Economy, Propaganda, Trade

“The EU is our biggest trading partner. We cannot afford to let it fail. We send much of our goods and services to Europe. We share their values. We want to crush Iran with our European pals. They bomb and regulate the world with us. If the Eurozone goes down in flames; if we let them—we’ll be next.” So said President Barack Obama on November 28. Well, sort of. (Okay, I’ve ad-libbed a LOT, but I think I know my president by now.)

Obama was entertaining leaders of the European Union. He promised them that America would stand ready to do its part to help them withstand the Eurozone crisis.

The stakes are too high, you say? For whom, Mr. President? Cui Bono? Who Benefits, Barack?

Ask yourself that question each time you hear a reporter/pundit/analyst/politician insist that the EU and the Euro zone cannot be allowed to fail.

In reply to the question as to what will happen if this colossus collapses, the stakeholders above parrot a bunch of non sequiturs or circular arguments. In the tradition of “a statement that does not follow logically from what preceded it,” these reasons don’t necessarily obtain:

We can’t allow the thing to fail because the stakes are too high. Again: For whom?

David Böcking of Spiegel Online (a most intelligent newspaper; the Germans are impressive) advances the arguments against the break-up of the Eurozone. These are mostly legalistic, and are not rooted in real economic realities. The treaties, observes Böcking, don’t allow for easy disengagement. Legal disputes could arise over debt owed if the seceding country had borrowed money. And, mostly, sinecured EU official would lose sway on the world stage.

Brace for impact, if you believed these bastards, but here are the economic realities:

We flesh-and-blood Americans trade not with Barack or with Brussels, the seat of the European central government, but rather with the people of Belgium, the Netherland, Germany, France. If the financial institutions into which Europeans and Americans have been herded by bureaucrats on both sides of the Atlantic collapse, well then, individual producers and traders will find a way to make a living without these artificial, inorganic structures.

This is a failure of government, not of all the people, although some of the governed, maybe even the majority, have failed. The people who’ve failed are those who have eaten the state’s forbidden fruit.