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America Needs To Rediscover Sacrifice In Inflation Fight
The Fed needs to show some conviction this week.
The June FOMC meeting is an opportunity for policy
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Americans have lost all will to sacrifice – we deserve it! Only ROW need sacrifice … if our sacrifice is the only corrective pill, we’re terminally I’ll.
Occasionally you hit the nail on the head with a sledgehammer. Well done, especially regarding what the Fed should/won’t do.
MMT addresses this in a fashion you are mentioning, unfortunately the Safetynet is not there for MMT to be a reality in our political climate. One particular political persuasion believes that poor people should be begging at the side door of religious institutions for food handouts and indoctrination.
Milton Friedman’s ideas seemed absurd to me when I was young and poor. So did Karl Marx.
MMT and Wealth of Nations are very compatible.
Whaddya mean, no sacrifice? 3100 SP500 is going to feel like a sacrifice.
That was meant to be sarcastic, of course. But we should all try to avoid portfolios being stretched out on the bloodstained altar.
Raising rates will not meaningfully destroy demand for inelastic goods and services, it will destroy demand for everything else. Elastic demand destruction will reduce the competition for labor and materials in the inelastic areas of the economy thereby increasing supply or reducing cost.
A couple of lines from one of Sting’s songs –
“Forever conditioned to believe that we can’t live
We can’t live here and be happy with less”
Damn, H, you are always extra smart on Sundays! This one puts it all on the table. You said we still had a nominal democracy until six years ago. I’m not sure it was that recent but it is clear to me that increasingly Americans, not all, but too many, are seeing selfishness and self-indulgence as god-given freedoms/liberties. Acting badly has now somehow become a preferred form of self-expression. Where I live in the heartland one town has outlawed roommates sharing rental property in case too many low-income folks might get together to support each other. Twice, local authorities have bulldozed homeless camps out of existence, making sure to leave muddy fields behind so those trashy folks won’t come back. Safety net? What safety net? I have seen elected officials in my area occasionally quietly suggest that if we could just shoot the homeless it would be better for them and the rest of us. The governor once again codified additional stupidity by signing legislation protecting doctors and pharmacists who wish to provide folks with Ivermectin and other quack “cures” for COVID. If we get this junk and something bad happens, too bad for us. It is our “right” to posion ourselves and in MO we protect that right. Yes, sacrifice is needed but I’ll take the under on that bet.
“I have seen elected officials in my area occasionally quietly suggest that if we could just shoot the homeless it would be better for them and the rest of us.” That statement is the most disturbing thing that I have ever heard. I doubt that living in a gated community will help these officials when their chickens come home to roost.
I hate to say it but you’re spot on: America needs a reckoning. I keep wishing moderates (Biden and Powell fall into that category) could thread the needle but the covid pandemic didn’t wake people up to a national or even human unity. Perhaps even the prevention of catastrophic death and Depression perpetuated the illusion of American Exceptionalism such that people actually blame those that saved us from the worst outcomes. The US currently has a spoiled populist majority (ignorant of the real plight 7 Billion suffer) and most of the power brokers are trying to figure out how to sacrifice… someone else.
I’m amazed that conserving or using less or otherwise downscaling is never a policy option — much like gun control, it seems to be a third rail of sorts. We love to talk about all the sacrifice and hard work that went into building this country, but now we want to sit back and passively collect the freedom dividends in the fixed income phase of our society. We’ll give plenty of lip service to sacrifice of course, but don’t you dare suggest anyone actually try it.
Jimmy Carter tried appealing to Americans to sacrifice, and it didn’t go over well when he sought re-election. There are certain lessons from history that politicians are well aware of.
Good example. In this case, followed by Reagan cynically ripping out the solar panels that were installed at the White House. Back then, Americans would rather fight than switch when it came to their cigarettes, and would rather waste energy than conserve or generate it, because, well, sacrifices were becoming tne province of weakness, suckers and pussies, not American exceptionalism, even as we never stop waxing poetic how this country was built on sacrifice. We are a country whose domestic auto manufacturers make almost no efficient ICE vehicles at a time of record gas prices. Sadly, that was not an unforeseeable accident. It’s that same hubris. I deserve/demand a 350 cu inch V-8 packed with 48 gallons of diesel and the right to bitch about that if it costs more than $150 to fill up on my way to Costco. Our leading candidate for President is obsessed with evil bird-killing windmills, light bulbs that make your bad hair actually look bad, and toilets that you have to flush 7, 8, 9 times like that’s somehow not a nauseating personal problem. Sorry for the rant. For the record, I still have hope.
H-Man, Your right there is no safety net. When your making $100K or less the pain is powerful. As noted in numerous posts, most Americans don’t have $400 to cover an emergency. So raise the price of food and gas by $400 a month and the “regular” people are being hammered. Oh, another post indicates that 30% of the people making $250K are living hand to mouth. And when it comes to consumer sentiment, drinking powdered milk with peanut butter and jelly gets old in a hurry. If you watch a $1MM portfolio turn into $300K, you may become one of those “regular” people when those are your retirement funds to ride into the sunset.
Any economic effects pale in comparison with the political effects of our situation. Barring a miracle, republicans will sweep the midterms, and thereafter the election infrastructure will be permanantly damaged. We were never taught that nazi germany came into being for reasons other than Hitler being “evil”. They never prepared us for Fox news, Donald Trump, and our own Facist demise.