Slowly start trimming the deficit and trying to grow/inflate our way out of it.
My fear is that our growth is so concentrated in the upper echelons, there's no way for the "whole" to grow at the net level at the rates we're going.
On the subject of growth, I was talking with a really smart business cat lately (an actual, no shit kidding member of MENSA who I should mention is a goat farmer on the side, only b/c I love that fact). I lamented my concerns about the absence of jobs for the middle class, and asked him his theory about how the market was so bullish when everything else was so terrible. He shared me with his views on why companies are making such strong profits, mostly for two reasons: 1) the recession forced them to trim the fat off their books, which led a lot of them to dump labor costs that they've learned they didn't need to carry in the first place, and 2) the real money is in the i.p.
By way of several examples, he mentioned that some absurdly high percentage of the iPad's profit is in the original design and in holding the patent. I don't recall the data, but the lowest profit margin is on the manufacture. So...the real money is retained here CONUS, even though the manufacture is overseas. Same thing with a tree-trimming attachment that Weyer is using: somebody (US) designed this "snatch and grab" device where this claw attaches to the tree (sitused in Russia), circ saws scope out and detach it from mother Earth, the claw then turns the stick perpendicular as other saws clean it along the circumference while the crane rotates at the base to re-orient over the hauling truck, and those same saws rotate out and cut the damn thing to spec ten seconds after it was still growing; all based on data entered into the computer before the sun rose that morning. The guy who invented the device makes ---on a per Siberian tree basis in---more than the cussin' Russian who got out of bed that day and left his family to go pull eight hours in the cab (and obviously, infinitely more than the six guys who are now unemployed since their no longer needed). Once again, the information economy values the idea over the labor. The catch now is that the ideas are getting so advanced they are not just superseeding the actual labor, their displacing it entirely.
If our "growth" strategy is just to punitively tax "the guy" at the top, he and his idea can/will re-locate outside of our jurisdiction 10x easier than you could move a factory ten years ago (or now...see Boeing, Washington State v. South Carolina). If we soak the top five percent, they'll just leave. They've never been more portable.
Isn't that right, California?
I think to capitalize on that front, we have to out-innovate the rest of the world, and we have to democratize that imperative out of the upper echelons. It's fine that the Silicon Valleys and RTPs are getting it, but its foolish to think turning the 5% of our six figures incomes into seven figure incomes is going to do anything for the people who used to work in the shuttered mills and furniture factories.
A good first step would be an effort (a sincere one this time, not a campaign promise) at domesticating energy production. We have the option to run our cars and trucks on ethanol, electricity and natural gas, rather than pay the Saudis to do run them for us (and that's about the best thing that happens when we pay the Saudis). Ethanol grown from American corn is concept that can actually get the jingoistic, A-rab-hatin' O'Reilly-factor crowd to agree with the Hippies. Name another issue ....but we still won't do it. WTFrenchToast?
If our plan is to "grow" our way back into solvency, what steps are we really taking towards growth and becoming more competitive?
