How much is the American political system to blame for the struggling economy?
Posted at 5:00 AM on September 27, 2011
by Eric Ringham
(36 Comments)
Filed under: Economy, Politics/Government
The U.S. economy has seemed to lurch from one crisis to another in recent months. At the same time, the White House and Congress have been locked in a perpetual political struggle. Today's Question: How much is the American political system to blame for the struggling economy?
Comments (36)
How much is the American political system to blame for the struggling economy?
I'd say between 73-98%.
It is estimated that methane and methanol production alone from hemp grown as biomass could replace 90% of the world's energy needs. If they are right, this is not good news for oil interests and could account for the continuation of marijuana prohibition. The claim is that the threat hemp posed to natural resource companies back in the thirties accounts for its original ban. At one time marijuana seemed to have a promising future as a cornerstone of industry. When Rudolph Diesel produced his famous engine in 1896, he assumed that the diesel engine would be powered by a variety of fuels, especially vegetable and seed oils. Rudolph Diesel, like most engineers then, believed vegetable fuels were superior to petroleum. Hemp is the most efficient vegetable.
In the 1930s the Ford Motor Company also saw a future in biomass fuels. Ford operated a successful biomass conversion plant, that included hemp, at their Iron Mountain facility in Michigan. Ford engineers extracted methanol, charcoal fuel, tar, pitch, ethyl-acetate and creosote. All fundamental ingredients for modern industry and now supplied by oil-related industries.
The difference is that the vegetable source is renewable, cheap and clean, and the petroleum or coal sources are limited, expensive and dirty. By volume, 30% of the hemp seed contains oil suitable for high-grade diesel fuel as well as aircraft engine and precision machine oil.
Henry Ford's experiments with methanol promised cheap, readily renewable fuel. And if you think methanol means compromise, you should know that many modern race cars run on methanol. About the time Ford was making biomass methanol, a mechanical device to strip the outer fibers of the hemp plant appeared on the market. These machines could turn hemp into paper and fabrics quickly and cheaply. Hemp paper is superior to wood paper. The first two drafts of the U.S. constitution were written on hemp paper. The final draft is on animal skin. Hemp paper contains no dioxin, or other toxic residue, and a single acre of hemp can produce the same amount of paper as four acres of trees. The trees take 20 years to harvest and hemp takes a single season. In warm climates hemp can be harvested two even three times a year. It also grows in bad soil and restores the nutrients. Hemp fiber-stripping machines were bad news to the Hearst paper manufacturing division, and a host of other natural resource firms. Coincidentally, the DuPont Chemical Company had, in 1937, been granted a patent on a sulfuric acid process to make paper from wood pulp. At the time DuPont predicted their sulfuric acid process would account for 80% of their business for the next 50 years.
Hemp, once the mainstay of American agriculture, became a threat to a handful of corporate giants. To stifle the commercial threat that hemp posed to timber interests, William Randolph Hearst began referring to hemp in his newspapers, by its Spanish name, "marijuana." This did two things: it associated the plant with Mexicans and played on racist fears, and it misled the public into thinking that marijuana and hemp were different plants.
Nobody was afraid of hemp--it had been cultivated and processed into usable goods, and consumed as medicine, and burned in oil lamps, for hundreds of years. But after a campaign to discredit hemp in the Hearst newspapers, Americans became afraid of something called marijuana.
By 1937, the Marijuana Tax Act was passed which marked the beginning of the end of the hemp industry. In 1938, "Popular Mechanics" ran an article about marijuana called, "New Billion Dollar Crop." It was the first time the words "billion dollar" were used to describe a U.S. agricultural product. "Popular Mechanics" said, . . . a machine has been invented which solves a problem more than 6,000 years old. . . . The machine . . . is designed for removing the fiber- bearing cortex from the rest of the stalk, making hemp fiber available for use without a prohibitive amount of human labor. Hemp is the standard fiber of the world. It has great tensile strength and durability. It is used to produce more than 5,000 textile products ranging from rope, to fine laces, and the woody "hurds" remaining after the fiber has been removed, contain more than seventy-seven per cent cellulose, and can be used to produce more than 25,000 products ranging from dynamite to cellophane.
Well since the "Popular Mechanics" article appeared over half a century ago, many more applications have come to light. Back in 1935, more than 58,000 tons of marijuana seed were used just to make paint and varnish (all non-toxic, by the way). When marijuana was banned, these safe paints and varnishes were replaced by paints made with toxic petrochemicals. In the 1930s no one knew about poisoned rivers or deadly land-fills or children dying from chemicals in house paint.
People did know something about hemp back then, because the plant and its products were so common.
All ships lines were made from hemp and much of the sail canvas. (In fact the word "canvas" is the Dutch pronunciation of the Greek word for hemp, "cannabis.") All ropes, fozzers (sp?) and lines aboard ship, all rigging, nets, flags and pennants were also made from marijuana stalks. And so were all charts, logs and bibles. Today many of these items are made, in whole or in part, with synthetic petro-chemicals and wood. All oil lamps used to burn hemp- seed oil until the whale oil edged it out of first place in the mid- nineteenth century. And then, when all the whales were dead, lamplights were fueled by petroleum, and coal, and recently radioactive energy.
This may be hard to believe in the middle of a war on drugs, but the first law concerning marijuana in the colonies at Jamestown in 1619, ordered farmers to grow Indian hemp. Massachussetts passed a compulsory grow law in 1631. Connecticut followed in 1632. The Chesapeake colonies ordered their farmers, by law, to grow marijuana in the mid-eighteenth century. Names like Hempstead or Hemphill dot the American landscape and reflect areas of intense marijuana cultivation.
During World War II, domestic hemp production became crucial when the Japanese cut off Asian supplies to the U.S. American farmers (and even their sons), who grew marijuana, were exempt from military duty during World War II. A 1942 U.S. Department of Agriculture film called "Hemp For Victory" extolled the agricultural might of marijuana and called for hundreds of thousands of acres to be planted. Despite a rather vigorous drug crackdown, 4-H clubs were asked by the government to grow marijuana for seed supply. Ironically, war plunged the government into a sober reality about marijuana and that is that it's very valuable.
In today's anti-drug climate, people don't want to hear about the commercial potential of marijuana. The reason is that the flowering top of a female hemp plant contains a drug. But from 1842 through the 1890s a powerful concentrated extract of marijuana was the second most prescribed drug in the United States. In all that time the medical literature didn't list any of the ill effects claimed by today's drug warriors.
Today, there are anywhere from 25 to 30 million Americans who smoke marijuana regularly. As an industry, marijuana clears well more than $40 billion a year. Obviously, as an illegal business, none of that money goes to taxes. But the modern marijuana trade only sells one product, a drug. Hemp could be worth considerably more than $40 billion a year, if it were legally supplying the 50,000 safe products the proponents claim it can.
If hemp could supply the energy needs of the United States, its value would be inestimable. Now that the drug czar is in final retreat, America has an opportunity to, once and for all, say farewell to the Exxon Valdez, Saddam Hussein and a prohibitively expensive brinkmanship in the desert sands of Saudi Arabia.
Time to Legalize Hemp and keep it legal. The world doesn't deserve to be kept impoverished.
The globe is full of poverty. Politicans promise us a new sunny day, but globism is dismal.
"businesses are not confident that our elected leaders will make decisions (one way or the other) thus allowing them to know they will be able to have a standard set of principles on which to grow their businesses."
Judy, Judy, Judy,
It is one thing to desire to grow a small business into something sustainable and another to be a corporate glutton. Our corporations are consuming too much of the planet. it is time to cap them.
Judy, Obama and his voters definitely wanted to see the country move forward, but the private debt bubble and recession is too broad and deep.
Steve the Cynic is closest to the truth on this question as well. It's not our political system so much as every class in the private sector wanting and sometimes getting more back than they pay into our federal treasury...except Warren Buffet and a few others!
I think our sagging, slow, stopped economy is a direct result of the fact that businesses are not confident that our elected leaders will make decisions (one way or the other) thus allowing them to know they will be able to have a standard set of principles on which to grow their businesses. They don't want to make big decisions one way or the other and then have Congress or state legislature pull the rug out from under them with new laws, regulations etc.
It is a recession of confidence. There is no confidence that anyone wants to see our country move forward.
Root cause is the corporate takeover of the American political system. Freedom won't be a reality until lobbyists are no more.
Those who think it's 100% are clearly wrong, simply because the government does not control 100% of the economy. (Even in Cuba there's a black market.) Economic booms and busts have occurred everywhere, all through history, and under all sorts of political systems. Government can't be blamed or credited for either booms or busts. However, what government can do is smooth out the roller-coaster. The best economic result we can hope for from government involvement is to help make it boringly adequate. We mostly had that in this country from the end of WWII until the repeal of Glass–Steagall in 1999, which paved the way for the bust of 2008. Sustainable sufficiency should be the goal.
Small companies made this country successful. Government interference has hindered business. Today Gary on MPR ignored my email question about how MN ranks in giving businesses tax incentives to start up and to grow. There won't be money to pay for government spending if people don't have jobs.Those of us who are older and unemployed will have many problems in coming years and will need government help if something isn't done about jobs.Public radio should have weekly programs on which experts can brainstorm about this and provide new ideas.
Obviously, the American political system is largely to blame. Now that corporations ere considered "individuals" and have the same rights under the Constitution, the system will only get worse as big corporate interests flood political campaigns with money and airplay propoganda, and essentially buy elections.
The average American has no real voice.
I fear the day will come when this country becomes so polarized and fragmented that we will enter a time of political assassinations, and maybe even another civil war.
100 %... 'Nuff said.
I hear a flushing / swirling sound,,, it may be time to get fresh water in the bowl.
∑
DTOM
Our political system requires politicians to work together. The fact that they frequently refuse to do so is not a flaw in the system.
Wow I'm glad I don't live on kim's planet.
People like her seem to forget that there's a difference between a country and its system of government. The founding fathers came up with a plan for a system of government. We the people make the country (good or bad). Being the best system of government is like being the prettiest waitress working at Denny's, who cares. Now a days people like kim have taken to twisting the government around to ring out the greatest financial gain. (or she's a shill for those that do, but that's an argument for another day). They call everyone who doesn't buy into their view as unpatriotic, a socialist, a fascist, the list goes on. You can't argue with those types, and really why would anyone really want to, except when they trample on my pursuit of happiness. My happiness comes down to living in a clean, unpolluted world that will still be that way for my children, having reasonable security (physical and economical) that doesn't involve big brother looking over my shoulder or jeopardizing the clean world ideal, and good friends and family. to keep the good friends I've found it helps to not take this government business too seriously.
The government sets and regulates the fiscal policy of the nation, and we the people elected those morons. You do the math but I come up with about a 50-50 split as to who's to blame. We all will need to make some serious sacrifices to get back on track, but few will be willing to actually do so. Those sacrifices may be paying a little more in taxes to get caught up, driving a car that gets better gas mileage so s to stop sending so much money out of country, and making our dollar's value so dependent on a commodity. If our energy policy and the military wasn't so intertwined that would go a long way to reducing the operating cost of the country. We could do without the McMansions and their poor energy efficiency, acre+ lots that dilute the local tax-base while adding to the infrastructure cost. again the list goes on, but in kim's world even suggesting these tramples on her "freedoms". Sad. In that way this country isn't so great, as we the people need to grow up and look beyond our immediate wants and desires and start doing what's right.
100%. Our political system allows our members of congress to avoid working together to solve our countries problems.
Kim, those aren't facts. They're opinions. (And how well informed can you really be, when you keep making such basic factual mistakes as referring to the national Democratic Party as the "DFL"? The DFL is the Minnesota branch. Obama is not a DFL-er.)
Here's my opinion (being honest about what it is): The economic collapse in 2008 was due to a large number of factors. Chief among them was an inadequately regulated financial system, rife with predatory lending, fraudulent securities, and excessive risk-taking, fueled by a housing bubble. The current miserable state of things is our comeupance for having tolerated it. Because of the bubble, the economy in 2007 seemed a lot better than it was, so people lived beyond their means, which made the crash worse. Our nation's chief mistake in dealing with it has been expecting a quick fix. I'm not at all surprised that the downturn looks like it will last beyond one presidential term. Nor am I surprised that people are blaming Obama for not fixing a problem that was not fixable in so short a time. The recession has hurt working class folks a lot harder than the wealthy, many of whom escaped unscathed or even better. I'm tired of hearing whiny rich folks complaining about "class warfare" when real people are really suffering from problems that the rich folks' greed caused.
What prolonged the Great Depression was FDR giving in to fiscal conservatives in 1937, four years after he first took office. Of course, things happen faster these days. Obama caved after just two years. If We the People weren't so anxious for a quick fix, cooler heads might prevail in Washington.
The American political system should get about 15-20% of the blame for the current economic situation. The US government gets too much credit/blame for good/bad economies, in the end our government can only maneuver in the margins while the market is the overall driver of the economy. In the current economic situation there's not much more the US government can do. The best thing to do is to restore confidence in American debt; this can be accomplished most effectively by increasing revenue (by eliminating most tax credits/deductions), reducing federal spending in most social programs and reducing overall tax rates due to the elimination of credits/deductions (this will increase efficiency). We have to remember at the moment the biggest worry is European debt (which the US government can do little about), so the best thing to do is to reassure the rest of the world the US will not go down that same path. I suppose some government spending would be beneficial to the economy if it was applied to infrastructure to benefit business and commerce so building roads, improving the electric grid and upgrading aircraft navigation systems should be the focus. We just don’t need another stimulus like the last one where much of the money went to one time payments to individual states with deficits and temporary tax breaks while less than 10% was spent on infrastructure.
The political system designed by our forefathers is functional and led to the greatest country on earth... why else does everyone across the world want to live here vs. their native country?
The Presidents Town Hall meeting in Silicon Valley is proof of the scam he throws at America:
For example: A random question was took from a participant ( who just happens to be a former Google executive) who said he is unemployed by choice and wanted his taxes to be raised. This man also is a multi milloinare whos name is listed as a huge Obama campaign contributor..yet, Obama acted as if he did not know this man when he took his scripted question. This has happened at every Obama town hall meeting..all scammed set ups to feed his direction in campaigning..where is the transparency in government that he promised? other examples: Project gun Runner, Solyndra, The Health Reform act " we got to pass it so we can see_ what's in it, per Nancy Pelosi, 1400 new regulations crafted into the health Care Bill while removing half a billion from Medicare, adding a government regulatory body to decide on which medical procedures and to who will be eligible...Obama has touted the dictates of the Open Society Soros people so in that_ he has been successful in furthering fascism in America.
Kernnedy,
It boils down to a corrupt system that is collapsing (yeah). It has nothing to do with lazy, uniformed voters, as, despite who wins the wealthy sway any decisions thereafter elected.
Its a lose-lose situtation.
It seems to me that the problem is not with our system of government, but our electoral process. We voters are largely uninformed, uninvoled, and just plain lazy. We are easily swayed by campaing ads. That's why money is so important to a campaign. It buys access to our televisions, radios, computers, and printed pages. Highly skilled advertising agencies craft visual and verbal themes to appeal to our emotions. And it works. We choose among talking heads, selecting the one with the image we like most. And once elected, our representatives focus on the business...of getting reelected.
Steve the cynic: You fail o address the facts but prefer to ridicule with your poor exaggerated ananlogies. Dispute this: The Obama admin. has thrown out the rule of law when it comes to the rights of private investors by their actions against the bondholders of Chrysler and General Motors, as well as forcefully taking over and operating both companies and others as quasi-private entities. Union pensions got the save while I as a former bond owner was pushed to the back of the line and lost it all. The Obama admin. has chosen which businesses will succeed or fail by the taxpayer financing of companies such a Solyndra among a score of others, others of which have failed. The Obama appointees to the National Labor Relations Board are now "dictating "to companies where they can locate and are attempting to force their workers into unions without secret ballots.
The mantra of public-works spending is alive and well and constantly being used to justify massive government spending. The demonization of the rich has taken on a new role in the Obama era, as the rich are now being singled out as responsible for all the problems created by the Obama policies and are a potential target for retaliation. The current proposal to raise taxes on the wealthy and the so-called "Buffett Tax" are solely an attempt to rally the people into a unified anger over the need to punish a perceived foe -- in order to shift the spotlight off the failure of the current government. Every Obama act he has signed has essentially been a failure..unemployment of minorities is record high and for each green Job created ( although they did count people who switched lightbulbs in fixtures as a Green job) the tax payer has paid over_ yes over_ a million dollars for each of these so called Green jobs. It didn't work in Spain where each green job erased 2.3 private jobs, and yet Obama uses Spain as his model??? Get a clue.
Both parties love to spend other peoples money since this is their path to reelection.
The republicans have learned the democrats are all lying liars and can't be trusted. Raise revenues and we promise to cut spending. Never happens and the democrats can't be trusted to keep their word.
The republicans, after 20 years, have finally understood the democrats will do anything to get more taxpayer money to hand out to the freeloaders, most of whom vote for democrats.
In addition, obama is a financial illiterate who is more concerned with his re-election than what is in the best long term interest of the country. obama arrogrance is no substitute for experience.
Would agree to compromise but only if democrats signed a binding contract and a promise they would relocate to Albania if they did not meet spending cuts.
We don't have a political problem; we have a spiritual problem: idollartry. (Yes, I meant to spell it that way.)
Kim, Obama's policies are "fascist like" in the same way that a dip in a lake on a hot day is tsunami like.
The American political system is a direct reflection of our society. We are the ones who elect people to office and then complain about those same people when they can't get along. I would suggest that in order to correct the financial problems in this country that we all start with what we can actually influence - ourselves. Pay off our own debts, don't use credit unless it can be PAID OFF within the month, save, and stop this mindless pursuit of material things, which don't really make us happy and end up in a landfill anyway. Our nation's motto is In God We Trust and yet we practice Consume, Abuse and Throw Away.
It is the media that spreads the notion that we have gridlock in the government. Compromise on extreme radical views is never a good thing but the President and DFL would like you to think that anyone who doesn't go along with more Solyndra wasteful projects or excess spending to their cronnies is somehow bad.
As Mc Cann wrote so clearly, " It was FDR who initiated the National Labor Relations Board to make the government the final arbiter in labor issues. ( Now we have the NLRB dictating to Boeing where they can build new factories and the result is a loss of thousands of jobs) The National Recovery Act that now governs all aspects of manufacturing and commerce. The Agricultural Adjustment Act, which introduced central planning to agriculture. ( Can you say SUBSIDIES?) Taxes were dramatically raised on the so-called wealthy and class warfare rhetoric accelerated in order to focus anger elsewhere and not on the government. (Obama speaks of class warfare today to avoid criticism of his fascist like policies)
Massive spending on public works projects was a centerpiece of the "New Deal."
Mussolini heaped praise upon FDR's New Deal as "boldly...interventionist in the field of economics." Roosevelt was not reticent in his compliments to Mussolini for the latter's "honest purpose in restoring Italy" and acknowledged that he kept "in fairly close touch with the admirable Italian gentlemen." Yet it is generally recognized today that by pursuing these policies FDR prolonged the Great Depression by another 5-7 years. (See Amity Shlaes: The Forgotten Man.)
A legacy of the FDR years is the nearly 170,000 pages of federal regulations that exist today and intrude into all aspects of the day-to-day life of every American. (Obama has added another 43 % of new_ regulations!) Barack Obama has not only added to the regulatory burden, but also taken actions which are geared to further establishing a fascist economy.
So yes, the government is solely responsible for allowing the CFR , Federal reserve to devalue our currency and the Bilderberg Group to dictate which business and which countries are manipulated.
While there are many factors hurting the economy, the inability of the congress to compromise is like kicking a man (the economy) when it is down. The ironic thing is that the republicans have stated the uncertainty of whether there would be tax increases would hurt the economy, how could they not think that the uncertainty of possible government defaults and shutdowns would not hurt the economy even more?
It seems to me that it is not the "system", but rather those of us who choose not be be informed.
I think we have far too many voters who are quite content to let others do their thinking and analysis for them. I know it is easy to vote a straight republican or democratic ticket. It is easy to let Rush Limbaugh or Jerry Falwell or Anne Coulter analyze issues for us. And it is easy to focus on one issue and let that be the litmus test.
Basically, I think most voters are mentally lazy.
The political system is a factor. Those in Congress who are not willing to compromise are creating an atmosphere of uncertainty. Take a look at the Dow chart on Google Finance (google.com/finance?q=INDEXDJX:.DJI#). Ever since that nonsense about the debt ceiling, it’s been all over the place…mostly down.
Also, deregulation of the financial system was a big factor in the bursting housing bubble. That is political. Insufficient tax revenue to support the nation’s needs contributes to the national debt - that’s political.
However, we, the people are also to blame…greed on Wall Street, a minimal or negative savings rate, “investing” in housing, people living beyond their means, ignorantly buying houses they couldn’t afford, ignorance about finances. There is a lot of blame to go around.
It's not the system that's to blame; it's the people who misuse and abuse the system for self-serving ends (both on the left and the right, but more so on the right these days).
The American Political System should be an arena for our many social forces to resolve conflict. It has sold out to the wealthy. Our political parties are allied with big money, and use the culture "wars" to keep us divided. This is dangerous, because it thrives on poverty, destroys liberty, and breeds revolt at a time when we need to work together to solve some very dire issues.
Oh this ought to be good. Bring on the over simplified political rhetoric.
Somehow the Ant always pays for the Grasshopper.
What we are experiencing both here and in Europe is that big government is unsustainable.
Europe is on the edge of the cliff, and the US has been chasing after Europe thinking it was the right thing to do for years. And in the last few years, we've been racing even faster.
We have come to a point where there are fewer people pulling the wagon and more people in the wagon. Many of the people in the wagon shouldn't be in the wagon. We've made more and more people dependant on a government program that there aren't enough private sector people wanting or willing to pull any more.
We don't let bad businesses fail, we have the government bail them out. We want to punish successful people for being successful.
So, there is less reward for winning and less risk in losing. Lemon Socialism doesn't work.
The American political system shares a significant part (but not all) of the blame. Other global economic forces come into play. However, Washington and Wall Street are two very large components of the global economy whether we like it or not.
Toeing the proverbial party line in both caucuses takes precedence over seeking realistic, reasonable and rational policy options for beginning to turn the economy around. Watch five minutes of cable news talking heads (either flavor) and you quickly discover that realism, reasonableness and rational behavior are in short supply amongst our "leaders."
When President Obama took office, the economy was not doing well. Rather than deal with that, he had a dream; that being to create another vast entitlement program (nevermind that we cannot sustain the ones we have in place now). That drove the economy right over a cliff.
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