Millions of unemployed face years without jobs

[ASH]

Re: Millions of unemployed face years without jobs

Ultimately, I'm less concerned about future defense spending, and more concerned about alluring desire to full utilise current unsustainable military dominance before it is ultimately lost....coming at the expense of billions of nameless brown and yellow people to keep the American Dream Machine rocking for another generation.

Thanks for that very thought-provoking post. I have been thinking along similar lines for awhile, but I hadn't considered the attractiveness of allowing the India/Pakistan thing to flare; I had previously formulated this in my mind as strictly an American nuclear sucker-punch... and dismissed that as unrealistic. This seems more plausible, albeit speculative (as you say).

I wonder if India and Pakistan slugged it out whether China would really join in -- and exactly how much of an equal contest it would be between the regional powers. Would the flames rise high enough to accomplish the goal, or would it instead accelerate the growth of India or China?

For that matter, I would think a world war might be necessary to kill enough people and destroy enough industrial capacity in enough of the world to give America a few more decades of dominance. And it seems to me the scope for a truly 'world' war is limited, in that only the US has significant expeditionary capability, and our current mode of conventional warfare is both hella expensive and oriented toward a smaller scale than the last big one. Also, I'm not sure that a major war today would have a stimulative effect comparable to, say, WWII (although a successful conflict would help 'reset' the clock on resource consumption and industrial competition as you suggest). Unlike the 40's, we don't need the excuse of a war to justify massive deficit spending -- we're already there as a matter of course -- and our starting position for accessing and deploying the national credit is an awful lot worse. I would tend to expect that an expensive war would be more likely to break the dollar than rescue it.

Basically, my thinking is that "use it or lose it" would only work if we were fighting a different kind of war than we have recently -- quick, cheap, and heavy on the nukes... aimed at destroying people and industry rather than capturing and securing territory. That would reset the clock on a lot of things, but I think it takes us out of the realm of likely policy. On the other hand, what you're suggesting -- more a matter of standing out of the way and allowing regional conflicts to develop than fighting a major war ourselves -- seems a lot more realistic and might be effective. The danger is that somebody we are hoping will be exhausted by the conflict instead achieves a rapid and decisive victory, and the war effort strengthens them.

BTW: I like the way you think, and enjoy your posts. Neither of us, I think, are advocating this soulless policy -- but it makes for an engaging 'what if?'.

[thriftyandboringinohio]

Re: Millions of unemployed face years without jobs

..I hadn't considered the attractiveness of allowing the India/Pakistan thing to flare...

And the US happens to have full military, special ops and intel concentrated just a stone's throw away in Afghanistan. A 300 mile radius around Islamabad includes Kabul, a good chunk of northern India almost to Delhi, and parts of China.

[santafe2]

Re: Millions of unemployed face years without jobs

This is not surprising given the amount of government involvement that will occur in this recession. Until people dont give up the notion that government can "create" jobs then we will continue to see people without jobs.

This article also points out to manufacturing jobs lost and low skilled jobs lost I find it funny that in all this debate about keeping companies in the US only regulations or penalties are brought up as a way of keeping companies here. Not once are incentives considered. how about cutting the corporate tax rate which is one of the highest in developed countries? I think that would much more than just penalizing companies for leaving.

Anyway, the reactions to the financial crises have been horrendous and to think that we will keep doing the same is even more mind-boggling.

As pointed out in iTulip articles well before I got here, government involvement may not be the problem, but government attempting to save the current financial structure certainly is a problem.

Government does not create jobs any more than men create life, but they've got an important role. Business will always find the path of least resistance to profit. It's the role of government to define the game and the rules so business knows how to win. Unfortunately for most, business is running the current US government and the rules may not be ideal for long term success.

In my personal life I think and act generationally and am concerned with issues of long term familial support. I act in a way I would expect a government to act. In my business life, I am much more concerned with current results, sales trends, the bottom line and cash flow. I react quickly and make changes to ensure the success of the business. It's not idealistic, it's a way to make the maximum amount of money possible each and every day. This is the nature of business. It's not wrong for business to work this way, but business must have a set of rules that are somewhat fair for all the players. We've lost most of that direction in the last 30 years in the US.

[lakedaemonian]

Re: Millions of unemployed face years without jobs

Thanks for that very thought-provoking post. I have been thinking along similar lines for awhile, but I hadn't considered the attractiveness of allowing the India/Pakistan thing to flare; I had previously formulated this in my mind as strictly an American nuclear sucker-punch... and dismissed that as unrealistic. This seems more plausible, albeit speculative (as you say).

Definitely speculative.......but the "deeper and steeper" problems get I think such a scenario could quickly become a bit less speculative and leaning slightly more towards definite-ish.

I wonder if India and Pakistan slugged it out whether China would really join in -- and exactly how much of an equal contest it would be between the regional powers.

I believe Pakistan/India are approaching a scenario much like the USSR/NATO circa 1988.......Pakistan possesses a strong conventional military, WMDs, political bankruptcy, and economic insolvency much like the Soviet Union/Warsaw Pact of the period opposing India in possession of a strong conventional military, WMDs, a chaotic but somewhat functioning democracy, and an economy motoring ahead of it's rival much like NATO of the period.

I don't know if the comparison can work beyond just a simple superficial level...but there is some relevancy....particularly on how India is slowly but surely motoring ahead of Pakistan in raw economic and military horsepower if not at a per capita level....hence China's long-standing special relationship with Pakistan.

Would the flames rise high enough to accomplish the goal, or would it instead accelerate the growth of India or China?

Have a look at India's "Cold Start Doctrine". Indian Military Doctrine is to completely destroy the Pakistani Army before any political intervention/pressure from Pakistan's sponsor's like China(and decreasingly the US) can be implemented. It is an extremely aggressive doctrine especially for one of the most volatile regions of the world and a sea change to the status quo. The use of such a doctrine where massive momentum MIGHT be achieved quickly leaves far less time for alternatives to, or de-escalation from, Pakistani first use of nuclear weapons.

I believe that while it may clearly be in China's best interest to also fan the flames as well with the willing sacrifice of potentially hundreds of millions of lives and it's longtime ally Pakistan...if it results in a multi-generational demise of it's long-time adversary India it would be a small price to pay from a clinical perspective.

I just doubt that India would go quietly into the night without threatening to launch on China if Pakistan makes first use of nukes.

The US could sit back and watch the Chindia house of cards fall under a partial ballistic missile defense umbrella surrounded by a cordon sanitaire with the direct threat of total destruction of ALL participants if the conflict is not regionally contained.

With China/India/Pakistan's limited nuclear delivery platforms focused regionally rather than globally it would be fairly low risk, high reward for the US to even proactively destroy any nuclear delivery platforms deemed a threat to non-combatants.....once Islamabad, Karachi, Mumbai, Delhi, Beijing, Shanghai, and Hong Kong has been destroyed of course.



For that matter, I would think a world war might be necessary to kill enough people and destroy enough industrial capacity in enough of the world to give America a few more decades of dominance. And it seems to me the scope for a truly 'world' war is limited, in that only the US has significant expeditionary capability, and our current mode of conventional warfare is both hella expensive and oriented toward a smaller scale than the last big one. Also, I'm not sure that a major war today would have a stimulative effect comparable to, say, WWII (although a successful conflict would help 'reset' the clock on resource consumption and industrial competition as you suggest). Unlike the 40's, we don't need the excuse of a war to justify massive deficit spending -- we're already there as a matter of course -- and our starting position for accessing and deploying the national credit is an awful lot worse. I would tend to expect that an expensive war would be more likely to break the dollar than rescue it.

Basically, my thinking is that "use it or lose it" would only work if we were fighting a different kind of war than we have recently -- quick, cheap, and heavy on the nukes... aimed at destroying people and industry rather than capturing and securing territory. That would reset the clock on a lot of things, but I think it takes us out of the realm of likely policy. On the other hand, what you're suggesting -- more a matter of standing out of the way and allowing regional conflicts to develop than fighting a major war ourselves -- seems a lot more realistic and might be effective. The danger is that somebody we are hoping will be exhausted by the conflict instead achieves a rapid and decisive victory, and the war effort strengthens them.

I see CONVENTIONAL Fulda Gap combined arms type conflict between states in the future to be both VERY short and possess EXCEPTIONAL violence of action...like a bar fight.....hit first, hit hard, hit often, kick them when they go down...effectively over in the picosecond after the first punch connects.

In terms of the perceived need to destroy industrial capacity, why?

Wouldn't industrial capacity FORCED idle in Chindia for a couple years to a decade achieve the same from the US perspective?

I've always wondered why C3I and C4I never evolved to include an F for Finance...at least when it relates to an objective of sawing off your opponent's head.




BTW: I like the way you think, and enjoy your posts. Neither of us, I think, are advocating this soulless policy -- but it makes for an engaging 'what if?'.

Cheers!

Right back at ya.......although admittedly some of the engineering and economics stuff goes over my head, I'm more "Hulk Smash!"

I'm not a big fan of speculating about low probability stuff......but this one leaves me thinking it's a (politically)Low Risk/High Reward(potentially) proposition from the perspective of a US politician the "deeper and steeper" we go.

Having seen some nasty things in a couple parts of this world, I have no desire to see conflict(and more specifically the human cost of conflict) as part of the solution to this set of global problems......but what I fear is it being pushed as an "Easy Out" with no political heavy lifting from the average US politician's perspective..and conflict seems part of our nature.

If they've sold their own people out to special interest devils, will they even hesitate for a second in seeing Asia's centres of gravity burn to the ground(both literally in the military and figuratively in the financial sense) to ensure the US way of life remains non-negotiable for at least one more generation?

Somewhere around here the Law of Least Effort could be dangerously applied.

If it's being speculated on here......surely someone somewhere who influences the powers that be has already contemplated it and every other option.

As I posted, I bet China would throw Pakistan under the bus to contain/attrit India.

I also bet the US would happily throw India AND Pakistan under the bus to negate China, provide the easy excuses to implement anything in the US, and most importantly maintain global dominance.

Not pretty.....but we're not living in the time of rainbows and sunshine anymore....and some folks at the wheel will be thinking and playing strategically.

I ask myself what folks like Kissinger and General Curtis LeMay would do if faced with the option? What about their modern counterparts?

For the sake of our children I hope we "only" wind up with a hybrid Argentine/Russian "flu".

[Sharky]

Re: Millions of unemployed face years without jobs

Here's how I see things happening, at the moment:

1. At some point, as a result of increasing demand from within oil producing countries and field depletion, real energy prices will increase dramatically (whether nominal prices will go as high as some expect is another question)
2. Existing overseas manufacturing that is currently economically viable as a result of wage arbitrage, will collapse
3. There will be a surge of repatriation of manufacturing jobs into America
4. At the same time, the American standard of living will decline, as imports become very expensive
5. The market for exported products will also decline, due to increases in shipping costs
6. Many export-oriented jobs will vanish

Given the economy's current focus on service-oriented jobs, my guess is that the net will be more total jobs, but with a lower overall standard of living. The heavy debt load in the US will compound the problem.

My sense of the war situation is that the underlying political purpose is to try to maintain the flow of oil into the US. In the long term, it's hard to see how that can succeed at a cost that's less than the value of the oil -- which means whether it continues or not, the economic impact in the long term is likely to be about the same: net destructive (which translates into more down-pressure on the standard of living).

I'm starting to think that the Big Trades of the next decade won't be in today's risk assets like gold, stocks, real estate, commodities or oil. Instead, it seems to me that the right currencies may end up as a very good place to be.

I'm also starting to be attracted to the idea of going heavily short on China.

[thriftyandboringinohio]

Re: Millions of unemployed face years without jobs

...My sense of the war situation is that the underlying political purpose is to try to maintain the flow of oil into the US. In the long term, it's hard to see how that can succeed at a cost that's less than the value of the oil...

Good point.
Big modern armies burn huge amounts of fuel; not only in-theater, but also back along the supply lines extending halfway around the planet. It will be tough to make the energy-returned-on-energy-invested go positive.

Two facts and a link to the site:

- The US military consumes about 340,000 barrels of oil each day.
- Over 70 percent of the tonnage required to position today's U.S. Army into battle is fuel. The Air Force spends approximately 85 percent of its fuel budget to deliver, by airborne tankers, just 6 percent of its annual jet fuel usage. (now that EROEI stinks!)

http://www.energybulletin.net/node/29925

Perhaps our petroleum experts can help put that into global perspective, or compare it to the oil output of Iraq.

[jpatter666]

Re: Millions of unemployed face years without jobs

Good point.
Big modern armies burn huge amounts of fuel; not only in-theater, but also back along the supply lines extending halfway around the planet. It will be tough to make the energy-returned-on-energy-invested go positive.

Two facts and a link to the site:

- The US military consumes about 340,000 barrels of oil each day.
- Over 70 percent of the tonnage required to position today's U.S. Army into battle is fuel. The Air Force spends approximately 85 percent of its fuel budget to deliver, by airborne tankers, just 6 percent of its annual jet fuel usage. (now that EROEI stinks!)

http://www.energybulletin.net/node/29925

Perhaps our petroleum experts can help put that into global perspective, or compare it to the oil output of Iraq.

Couple of points:
1 ) Current military technology (as has been commented here before) has made it far harder to hold territory against even a minor force (currently on display in Iraq and Afghanistan).
2 ) I think that future military strikes would be directed at economic targets (I feel that many future military conflicts will be economic conflicts). For example, for Iran one of THE top non-nuclear targets are the ports and refineries [Iran as I understand it actually *imports* gasoline]
3 ) Remote planes/battle platforms are becoming the US future faster than most of us know. What is out there compared to what is acknowledged is significant. I was not at all surprised to see the announcement that the US military is closing in on being able to generate aviation fuel from algae. Has to be a top priority for them and for long-term bases actually could *cut* that supply line and be partially self-sufficient.

So far as the US permitting a nuclear exchange (anywhere) I find that difficult to rationalize in any scenario, but I'll mull it over.

[goadam1]

Re: Millions of unemployed face years without jobs

I just hired someone and gave out raises. But my gross is flat. I do push more out of my staff to keep the net up even with my increased cost. To do that I need good people who are motivated. In the end I took a pay cut to keep my business thriving. But I run a little business whose bottom line is answerable only to me. It's public corporations that do better by squeezing workers.

[Sharky]

Re: Millions of unemployed face years without jobs

Good point.
Big modern armies burn huge amounts of fuel; not only in-theater, but also back along the supply lines extending halfway around the planet. It will be tough to make the energy-returned-on-energy-invested go positive.

It's not just the raw energy they burn. It's also all of the other costs of waging war.

The cost of the wars in Iraq and Afghanistan are now over $1.0 trillion. Even if we're generous and say the cost of oil is $100/barrel, that's the equivalent of 10B barrels. Let's say that sustainable production in Iraq might be 5M barrels per day; that's 1.8B per year.

In addition, without the wars, the cost of oil would probably be much lower, since the perceived threat of supply disruption would also be lower -- and the lower the price, the larger the gap between the cost of the war and what the US gets out of it.

This also doesn't count the costs of rebuilding, not to mention the cost in human life.

[flintlock]

Re: Millions of unemployed face years without jobs

Couple of points:
1 ) Current military technology (as has been commented here before) has made it far harder to hold territory against even a minor force (currently on display in Iraq and Afghanistan).
2 ) I think that future military strikes would be directed at economic targets (I feel that many future military conflicts will be economic conflicts). For example, for Iran one of THE top non-nuclear targets are the ports and refineries [Iran as I understand it actually *imports* gasoline]
3 ) Remote planes/battle platforms are becoming the US future faster than most of us know. What is out there compared to what is acknowledged is significant. I was not at all surprised to see the announcement that the US military is closing in on being able to generate aviation fuel from algae. Has to be a top priority for them and for long-term bases actually could *cut* that supply line and be partially self-sufficient.

So far as the US permitting a nuclear exchange (anywhere) I find that difficult to rationalize in any scenario, but I'll mull it over.

That's exactly how modern military operations should be done. Hitting key economic and transportation sites, then let them wither on the vine. I've never quite understood this "boots on the ground" mentality when it comes to actual national defense. Occupation, that's another story.

[thriftyandboringinohio]

Re: Millions of unemployed face years without jobs

That's exactly how modern military operations should be done. Hitting key economic and transportation sites, then let them wither on the vine.

One could call those truly serious economic sanctions!

[ggirod]

Re: Millions of unemployed face years without jobs

from Ash: We need to do something for our elderly, but at any given time, our allocation needs to be proportional to our actual resources. Sinking an ever increasing portion of our limited resources into programs for the elderly is a dead end, and will eat into our seed corn.

I think there may be a solution to the problem of supporting the elderly. Since health care costs are rising continuously and the nation does not have the resolve to control them in any other rational manner, then the simple and expedient method is to pass a new law that states:

For all new Medicare recipients effective immediately, coverage by Medicare creates an implied Do Not Resuscitate order for the patient. In other words, should the patient's heart/respiration stop, there would be no attempt to resuscitate. Other care would have no age limit but the first time the patient expires is his/her last. Persons who wanted immunity from that order could post a cash bond in the amount of one million dollars to cover the medical consequences of resuscitating them. As soon as that bond balance dropped below the million dollar mark, the do not resuscitate order would again be in effect unless the bond was timely replenished. Unused bond would revert to the estate on death.

This law would have many beneficial aspects. It would relieve the medical profession of many challenging decisions concerning end of life. A quick check of fund balance would answer the question unequivocally. Medical costs would decrease dramatically as would the need for costly futile intensive care. Since demand for expensive services would be cut dramatically, costs for all patients would be less. Hospitals would not need to invest in high tech units to keep bags of bones metabolically alive so overall costs would decrease. People would finally have realistic expectations that align with their worth.

While other means of limiting care might be questionable from an ethical viewpoint, this is not, in that if the person dies, he dies. If he lives he lives. Period. No choices, no guilt.

Simple, huh? and much better than standing by greedily wringing our hands as a few billion people get exterminated to improve our balance of payments.

[jiimbergin]

Re: Millions of unemployed face years without jobs

I think there may be a solution to the problem of supporting the elderly. Since health care costs are rising continuously and the nation does not have the resolve to control them in any other rational manner, then the simple and expedient method is to pass a new law that states:

For all new Medicare recipients effective immediately, coverage by Medicare creates an implied Do Not Resuscitate order for the patient. In other words, should the patient's heart/respiration stop, there would be no attempt to resuscitate. Other care would have no age limit but the first time the patient expires is his/her last. Persons who wanted immunity from that order could post a cash bond in the amount of one million dollars to cover the medical consequences of resuscitating them. As soon as that bond balance dropped below the million dollar mark, the do not resuscitate order would again be in effect unless the bond was timely replenished. Unused bond would revert to the estate on death.

This law would have many beneficial aspects. It would relieve the medical profession of many challenging decisions concerning end of life. A quick check of fund balance would answer the question unequivocally. Medical costs would decrease dramatically as would the need for costly futile intensive care. Since demand for expensive services would be cut dramatically, costs for all patients would be less. Hospitals would not need to invest in high tech units to keep bags of bones metabolically alive so overall costs would decrease. People would finally have realistic expectations that align with their worth.

While other means of limiting care might be questionable from an ethical viewpoint, this is not, in that if the person dies, he dies. If he lives he lives. Period. No choices, no guilt.

Simple, huh? and much better than standing by greedily wringing our hands as a few billion people get exterminated to improve our balance of payments.

Most of my friends and relatives (including me) who are on Medicare already want DNR orders. Based on the experience that I see everyday, that would not dramatically effect any cost. I do not see that this would be much help at all.
jim

[ggirod]

Re: Millions of unemployed face years without jobs

Based on the experience that I see everyday, that would not dramatically effect any cost. I do not see that this would be much help at all.

I think it would, actually. Take a look at cost of end of life care and do not resuscitate cost savings in Google and see for yourself. Getting control of even one part of that cost would be a major victory. Once there is control of that part, the medical establishment would likely decide that cooperating made a lot more sense than being marginalized by edicts. Right now the medical insurance establishment can buy whatever they want. Once they lose even one line item it will put them on notice. Then they will face the choice of cooperating or losing their power in incremental steps.

[tree]

Re: Millions of unemployed face years without jobs

Good for you.