From the WSJ via Pajamas Media:
In December 2008, forecasters surveyed by the Wall Street Journal predicted the jobless rate would hit what then seemed a very high 8.1% at the end of 2009. Surveyed again this past week, forecasters now anticipate year-end unemployment of 10%. That suggests 775,000 more Americans will join the ranks of the jobless in the next six months. Because most Americans depend on their paychecks for their shopping, a weak job market and lousy wage growth have cast an ominous shadow over consumer spending and the overall economy.
Officially, predictions are for the recession to end in late 2009 – which prediction I can only figure is either wishful thinking, or some bizarre assertion that “not immediately getting massively worse” is “recovery”. To be sure, we could very well see a quarter or two of allegedly positive growth in GDP – but expect full analysis of such GDP growth to be entirely in government spending with only trivial amounts of new GDP coming from wealth creation.
And therein lies the problem with the linked quote – we’re expecting a rise in consumer spending to pull us out of this, and the people who see the flaws in Obamunism are noting that Obama’s policies will keep consumer spending low, thus short circuiting a recovery. But we shouldn’t be looking for consumer spending to drive us out of the ditch – we should be looking for making, mining and growing things to move the economy. We can punch up consumer spending in a lot of ways and, perhaps, get some GDP growth…but until we, as a people, start making, mining and growing more of our own things – ie, more of our own wealth – we’re just going to be spinning our wheels. We shouldn’t be buying manufactured goods from China, food from Argentina or importing oil from Arabia…we should be doing all this on our own.
We must learn the lesson – we’re in this mess because we bought the scam that money managing was the way to wealth. We can’t get genuinely rich by, as it were, taking in each others laundry. We have to produce something – and production ultimately means things out of our own soil and made by the sweat of our own brow. Unless we’re willing to put in a bit of sweat equity and get a bit dirty, we’re just going to push ourselves further and further down the hole. Obama wants to spend us in to wealth, more sensible economic gurus want us to privately consume our way in to wealth – I want us to earn a living.
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