During the last boom, there was massive misallocation of resources to support the malinvestment in housing and the production and distribution of goods and services to support the boom in housing, and even to furnish the houses created in the boom. There is much unemployment resulting from the bust, among people who await the government to create another boom, in which the unemployed will again be employed. Good luck on that.
People who would have been self-employed were taken up into enterprise directed by misallocation, or otherwise an alternative to self-employment. AS trucks, stores, shopping carts got bigger to match the credit boom, mini-storage companies boomed to store all the junk people were buying. Stores stayed open longer hours and more days to accommodate the traffic.
At the same time as government grew, the backfilling of rules and regulations written by thousands of government workers, in turn enforced based on the whims of millions of government inspectors was in effect salting the earth so new businesses rarely formed, or could form as the big biz model capitalism applauded people wrote rules and regulations that served big business, but crushed small business, not that anyone particularly noticed, since there were too few people to object. (And the worse rules always contain a "grandfather clause" meaning the new regs only apply to new businesses. That would be you.)
We live off the farmer and fisherman, with division of labor making us wealthy, in the sense of access to goods and services. Until we can clear out the excess capacity through bankruptcies and rule of law we will not get out of this.
The bailouts were to save the system. Or more to the point, save A system. If that system were to fail, a better system could emerge. Out of the ashes a better economic system would emerge (as long as violence is not involved.)
We have such a clear example of this in progress. In 1980, there was a perfectly good telecommunications system, although monopolized, in place and functioning. No apparent need to change it. It was changed It was deregulated. And then we got competition. Then we got innovation, hooking up computers to telephones, then we got the internet. Then we got Apple and Facebook and google. And not a shot fired.
We need to deregulate something, anything. Banking. Law. Defense. medicine. Education. ANYTHING. Mass transit, which spends over 50% of the money to move 3% of the people...it is goofy. Free markets will give us what we need. As in telephone deregulation we have no idea what good will come, we can know it will come.
We need it now. We'll know we are out of the woods when toasters are made in usa again.
People who would have been self-employed were taken up into enterprise directed by misallocation, or otherwise an alternative to self-employment. AS trucks, stores, shopping carts got bigger to match the credit boom, mini-storage companies boomed to store all the junk people were buying. Stores stayed open longer hours and more days to accommodate the traffic.
At the same time as government grew, the backfilling of rules and regulations written by thousands of government workers, in turn enforced based on the whims of millions of government inspectors was in effect salting the earth so new businesses rarely formed, or could form as the big biz model capitalism applauded people wrote rules and regulations that served big business, but crushed small business, not that anyone particularly noticed, since there were too few people to object. (And the worse rules always contain a "grandfather clause" meaning the new regs only apply to new businesses. That would be you.)
We live off the farmer and fisherman, with division of labor making us wealthy, in the sense of access to goods and services. Until we can clear out the excess capacity through bankruptcies and rule of law we will not get out of this.
The bailouts were to save the system. Or more to the point, save A system. If that system were to fail, a better system could emerge. Out of the ashes a better economic system would emerge (as long as violence is not involved.)
We have such a clear example of this in progress. In 1980, there was a perfectly good telecommunications system, although monopolized, in place and functioning. No apparent need to change it. It was changed It was deregulated. And then we got competition. Then we got innovation, hooking up computers to telephones, then we got the internet. Then we got Apple and Facebook and google. And not a shot fired.
We need to deregulate something, anything. Banking. Law. Defense. medicine. Education. ANYTHING. Mass transit, which spends over 50% of the money to move 3% of the people...it is goofy. Free markets will give us what we need. As in telephone deregulation we have no idea what good will come, we can know it will come.
We need it now. We'll know we are out of the woods when toasters are made in usa again.
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