Sunday, February 1, 2009

Globalization the Market and the Economy

Yesterday, I heard on NPR that our country's financial crisis was viewed as the collapse of a pyramid type monetary scheme. This affects the global market and globalization itself...

The question posed and the answer to the crisis was to funnel money back into the economy. Thus, the stimulus package...but also, it was stated that the money had to be given to the poor, as that was the only way to ensure that the money would be funnelled back into the economy through spending...

I have two problems with this situation. One, while it may help the economy, does it help the poor really? Doesn't it breed dependence and teach irresponsiblity, by the dependence on government hand-outs and then spending, not saving or investing? What character does it breed? And what does it do for those of us who foot the bill throught taxes?

The other problem I have with this type of solution, is two fold. One, that our economic recovery will be dependent on cheap goods that are made by "slave labor" in other countries. Not only does this produce a country dependent on cheap goods made elsewhere, but it limits investments in our own country's econonmic future. Much of our economy is already owned by other rogue nattions, anyway. (will we see the collapse of our nation to these rogue nations because of our innate greed and materialism/)

Another program last night followed a graph that showed the history of the value of our money. After the Depression ("29), our money which was based on gold, was a steady horozonial line, and gradually (only slightly) increased at 1965 (gold standard devalued) and then sharply rose, as in a vertical straight line, after the Wall Street collapse...Our money it was proposed is decreasing in value at hisorically unprecedented rate. Even those of us who have been frugal, and saved, will be poor if money is devalued at this rate. I guess it's better not to be frugal based on this kind of economic evaluation. America has always been based on a free market economy, and now, the free market is no more.

There was other news last night that Mexico and our borders are seeing more problems with gang infilteration , drug smuggling, etc. What will be the future for our children and grandchildren?

Some of us are helpless to really make changes nationally, as the average citizen is at the mercy of the elite elected officials, who have their own interests to consider...which makes me wonder how much of the stimulus package is to protect those interests or to provide pay-offs before the inevitable collapst of our economy for good...


Keith Dannemiller said...

"Doesn't it breed dependence and teach irresponsiblity, by the dependence on government hand-outs and then spending, not saving or investing?"

I have one problem with your assumption disguised as a question. Why would you think that the poor would be susceptible to dependence and irresponsibility any more so than General Motors? Is there something inherent in government givebacks that makes the poor respond differently than a multi-national corporation?
Please elucidate.

Angie Van De Merwe said...

Keith, I agree that there is no difference. But, I was responding to the NPR interview about how money would be distributed to bring back the economy. This person said that the poor would be targeted as the super charger of the economy. That was what my elaboration was about.

As to economics proper, I don't think there is any difference when business uses government funds in their bail-out. But, when you get into multi-national corporations versus individuals/families, there is a difference in the consequences. And some do not see that multi-national cormporations will impact many more people/countries than individual families. It is like arguing about feeding a poor child, versus military spending. Even though the child has a right to food, the food will not be distributed if the government is not, the first priority is proper ordering of government so that humantarian aid can get through. That is a similar parallel, I think.