Recent comments by John Brian Shannon

• Complacency in a Leaderless World

  Hi Joseph,
  
  Great piece, as always!
  
  We are at a point in human history where we should now be thinking; "Which is more important, 'the economy', or 'the people'?"
  
  Thus far, developed countries have preferred to (this is the 'economy' part) invest in making evermore money for corporations -- and that's fine, look at the great progress that has been made.
  
  However, I think we are near the end of that paradigm, because we have 'topped out' or 'plateaued' if you prefer that term.
  
  U.S. corporations these days are awash in cash. To wit, the excess liquidity seen in the U.S. over the past few years -- and really, what good is all that money doing anyone, including those corporations which can't invest it -- as there is nothing which pays enough to warrant such massive investment?
  
  Mountains of money piled up in banks, but nowhere to spend it!
  
  Not here in North America, as it is cheaper to set-up shop in Asia.
  
  Not in Asia, as there are few left (here or anywhere) who can afford to buy anything more than the things they already purchase.
  
  (By which I mean most of the discretionary income in the developed world is already being spent)
  
  The unemployed, obviously have much less discretionary income AND are a drain on U.S. government coffers.
  
  And they don't want to be! They would prefer more discretionary income, but for the 22 million people seeking jobs, there are less than 2 million jobs available.
  
  So, telling 22 million Americans to "just get a job" is disingenuous and haughty. Perhaps evil.
  
  If we don't have jobs here, then we can't buy products and services made by our corporations -- and that will continue to be the case. This is just as true even when our corporations own those Chinese factories.
  
  We have shipped millions of jobs overseas, and soon, few in America will work, because most of the jobs will have been shipped over there.
  
  And soon, the Asian economies will plateau, but for a different reason. There won't be enough purchases (demand) to sustain any more growth (supply).
  
  The great Asian tigers China and India will no longer grow, when there isn't enough demand from consumers in the developed nations.
  
  So much for growing the economy, which, I agree is a noble enterprise, but we have done that and look where it has got us. It is not going to get better, in fact, over the long term, it is going to slowly degrade from the place we are today.
  
  Yes, things may pick up a bit over the next year or two, but when measured over the next 10, 20, 30 or 40 years, the developed nations will slide backwards relative to their present position and relative to the developing nations.
  
  Time for a reality check.
  
  "If we keep on doing what we have been doing, we are going to keep on getting what we have been getting." -- Jackie B. Cooper
  
  We tried it one way, and it worked extremely well for a long period of time, that period is now drawing to a close.
  
  Focusing on the economy was a great way to grow America.
  
  But now, I suggest we focus on 'the people'.
  
  Making their lives better by promoting and creating better employment opportunities, education and health-care.
  
  1) A very high Employment rate would do wonders for the economy of the U.S. and our suppliers in other countries.
  
  2) A higher universal standard of education for all, especially for workers, will empower U.S. corporations, their workers and citizens all over America, and again give the U.S. the competitive edge it needs in the world.
  
  Educated people invent and build better products and services, and can enhance a corporation in other ways -- leaving a large percentage of the population out of the education equation just doesn't make sense.
  
  3) And a healthy population will be more productive when they do work, more willing to look for work when they are unemployed, and workers will miss less workdays with sick children or partners.
  
  Up till now, putting most of the emphasis on growing 'the economy' has served 'the people' well, but now, after plateauing, if we start to put huge emphasis on 'the people' directly, I suggest we may reap even larger dividends for 'the economy'.
  
  Firing on all cylinders, is what America needs to do now.
  
  (Of course, I'm thinking cylindrical bar charts, to show different demographics. Finding out what needs to be done to bring the largest possible majority to a high employment level, a minimum college or certified tradesperson education level and a high universal health standard)
  
  This will allow America to fire on all cylinders!
  
  What would it take to bring this vision to fruition? Probably less than we are wasting now.
  
  Best regards, and again, nice article! JBS
  
  
  
  

• Is the Euro Crisis Over?

  Hi Jean Pisani,
  
  Yes! Your last paragraph says it all. Once the crises are over, the attention of politicians and the public then turns to other matters.
  
  These are indeed a lost opportunities "to signal that the euro is a stepping stone toward a prosperous, resilient, and cohesive union; and... to signal that the harsh economic adjustment that continues to dominate the policy agenda for much of the continent is not an end in itself."
  
  I hope that Eurozone leaders agree to continue to find ways forward for the Eurozone together -- and not become distracted by current events, otherwise we will again see economic discord and dysfunction.
  
  Best regards, JBS
  
  

• Writing the Future

  Hi Jeffrey,
  
  Impressive article and congratulations on United Nations Secretary-General Ban Ki-moon asking you to help mobilize the world’s expertise moreso than you already have.
  
  The UNSDSN is an idea whose time has come and the fact that it has been initiated, gives me great hope.
  
  All of the excellent points you raise will not be enough to address our failings at the civilization level. Technology, of course, must be part of the solution. Better governance, must be universal.
  
  Societal consumption levels must level off and in some cases decrease in order for our civilization to become a sustainable one.
  
  Which leads me to my point. All the technology in the world, and all the good governance in the world will improve, but ultimately fail to turn our species into a sustainable one.
  
  Suppose that 90% of the planet's population can and are willing to live a sustainable lifestyle, but 10% insist on living as the 1%'ers do these days, we will miss the mark.
  
  By 2050, our ecosystem will be in the same, or worse, shape than we are today.
  
  For now, 1 billion live unsustainably (the developed countries) out of a total population of 7 billion.
  
  But in 2050 our population is expected to be 10 billion. If 10% of the population refuses to lower their consumption level, we will be worse off than we are now.
  
  Not to mention a great portion of the Earth's resources will have been used, burned or otherwise consumed before then.
  
  If we truly are an intelligent species, we will solve these problems, and not just the technological or the governance challenges, but our notions of societal status, as manifested in our consumption levels and living standard expectations.
  
  We will know by 2050 whether we are an intelligent species or one doomed to living on a depleted and polluted world, from which there is no (yet devised) escape.
  
  I suggest 'the jury is still out' on that point.
  
  
  Best regards, JBS
  
  

• Austerity in Small Places

  Also, see this hard-hitting piece by CNN Money written by Rob Norton back in 1995, on Canadian and Swedish economic efforts to gain control over deficits and debt.
  
  "The Baddest Budget Cutters"
  
  http://money.cnn.com/magazines/fortune/fortune_archive/1995/10/16/206853/index.htm
  
  While Canada and Sweden succeeded with their austerity programs, the U.S. was seen to be fighting a forest fire with a garden hose.
  
  Cheers, JBS

• Austerity in Small Places

  Fine article, Daniel.
  
  I agree with your conclusions and with the conclusions of Professor Krugman.
  
  I would add however, that Canada is not a small country with a "one-off" economic debt/deficit success, such as Latvia or Iceland.
  
  In the late 1980's Canada's deficits and accumulated deficits had spiraled out of control.
  
  The Conservative government at the time, instituted a 7% Goods and Services Tax on practically everything sold in Canada.
  
  That government and the follow-on Liberal government cut government spending, used the GST windfall to simultaneously pay down debt and to directly stimulate the economy with job creation (major and minor national infrastructure projects) and it worked fantastically well.
  
  In 7 years, Canada went from "worse than Greece" and "an honourary member of the third-world" -- to the best performing OECD nation in many categories.
  
  Please read either the Globe and Mail account of this massively successful economic transformation.
  
  
  http://www.theglobeandmail.com/report-on-business/economy/the-lesson-from-canada-on-cutting-deficits/article2243702/print/
  
  http://www.theglobeandmail.com/commentary/how-to-tackle-us-debt-just-do-it/article4549984/
  
  I commented on this Canadian success story and posted it on my website:
  
  http://jbsnews.com/tag/the-lesson-from-canada-on-cutting-deficits/
  
  Best regards, JBS