It is terribly unsatisfying to watch all the purported experts fumbling with problems that are way too large for their skillsets, which mostly consist of knowing how to talk to each other and the public in a commonly accepted vocabulary of existing economic doctrine, without any sign of creativity or genuine insight into history and society.
So here is my "outside of the box" proposal to give the U.S. a new start. It's a simple concept, really, although there would be myriad details to resolve. In short, we enter into one huge deal with the Chinese -- they acquire sovereignty over the entire state of California, in exchange for forgiving all U.S. government and agency debt (with accrued interest) currently held by them. They would of course assume responsibility for California's existing legal and financial obligations as well.
There will be many objections, of course, and time and space will not allow for a proper anticipation and rebuttal, but the main point is that America is flailing around in a very deep soup, and absent drastic action, things will only get worse.
Let me turn to some of the advantages.
The obvious goal is to sufficiently restore Uncle Sam's creditworthiness to put us in a position to supply sufficient capital to save the banking and auto industries. But there will be many ancillary advantages. For example, the troubled Las Vegas economy will receive an enormous boost by virtue of proximity. The Chinese love to gamble.
Residential real estate all over the country, especially in coastal areas, like Florida and even poor New Orleans, will see tremendous rush of buying activity by those Californias who don't wish to live under a nominally-Communist dictatorship. Not that I have any real pity for Californians -- there is no one to blame but themselves for their terrible fiscal mess. And they tend to be annoying. Tough times call for tough solutions. Plus, it would be a challenge worthy of Arnold and his electorate, to be a democratising influence on their new trans-Pacific affiliates.
Given the attractiveness of the prize, at least from the point of the Chinese, who presumably don't know just how crazy people in California actually are, I think we could extract some other important concessions and advantages. I think they would agree to at least the following things, which would enhance America's long-term strategic position:
1. Hands off Taiwan
2. Human rights in Tibet.
3. Cease supporting hostile regimes such as North Korea and Iran.
4. If we push hard enough -- a mutual defense treaty for the U.S., Japan and China, in the event of Russian aggression.
I am probably leaving out a few things we could ask for, but the state department has no shortage of policy wonks to think this thing through.
There would be plenty of business points to iron out. We could retain Goldman Sachs and Morgan Stanley to advise the government, with the fees to be reimbursed by the buyer. This alone would be a boost for the ailing New York economy.
There will be some serious diplomatic challenges of course. The Europeans may feel left out. Mexico may wish to assert that California was stolen from them in the first place. For these reasons, it is essential that it be done quickly, while President Obama is still basking in worldwide goodwill. And since it is clear that U.S. engine is what pulls the entire worldwide economic train, all should rejoice in seeing us resolve our economic woes.
Who knows what new creative forces would be unleashed by the cross-fertilization of culture, finance, industry and form of goverment? What wonders of modern cuisine, art and literature might be emerge from this experiment in modern civilization?
It is indeed time to pause and reflect on the miracle of modernity. It seems like only yesterday when the prevailing image in this country was of little yellow men in wide straw hats breaking rocks to build the railroads. The "yellow peril" indeed!!!!!Well, no tickee no washee is still the rule of the day and we owe them trillions of dollars. We bought stuff we didn't need with money we didn't have. Maybe someone in California is clever enough to think of another way to pay China back, but this is my best shot at it.
mg (New York -- 02/20/2009)
Saturday, February 21, 2009
Monday, March 17, 2008
First post....
So many subjects, so much to say about each, so little time.
Let's discuss millennial optimism and post-2000 disillusion. Years ago, I read a history of the middle ages, in which there was a colorful description of the years 990-1000. Something about the impending round number had caused people throughout "Christendom", i.e. western europe, to believe that the world was coming to an end. Preachers preached doom and urged repentance, crowds gathered to wait for the demise of the world. This was, in effect, the end of the dark ages; at least in the view of that particular writer, a culmination of centuries of ruin and despair.
The very fact that the world did not come to an end, apparently, gave rise to a burst of optimism and the beginning of the more prosperous middle ages, which eventually in turn would give way to the renaissance and then finally modern times.
I read this passage with great foreboding; it was the late 1990's, the end of the next millenium was fast approaching, and western civilization was engaged in an orgy of optimism, which struck me as the opposing mirror image to the final decade of the preceding millennium. There were books with silly titles like "The End of History." The stock market was breaking effortlessly through to new records, 10,000 was followed by 11, then 12, 13 and 14,000. Internet stocks and frenzied day-trading seemed to fit the pattern, as did all the worldwide planning for end of the millenium parties.
There were occasional darker notes, such as the now largely forgotten hysteria over the Y2K problem -- the fear that computers were programmed to keep time in centuries, but would massively fail when forced to adjust to a change of the first integer, representing the millennial level.
But still, the celebratory atmosphere seemed to me a culmination of centuries which had been characterized by economic growth, the spread of democracy and the broad extension of rights -- things we take for granted like the elimination of slavery and women's suffrage. And if the despair of the 990's had given way to a new more optimistic way of thinking, would the complacency, enthusiasm and unrealistic expectations of the 1990's, be a precursor to darker times?
Of course, I knew it was sheer intellectual hubris to think in such vast over-arching terms. An unpublished armchair philosopher daring to contemplate the sweep of history. And I did not write or speak about it, except to a handful of people who are accustomed to my habit of developing pet theories about subjects on which I have no right to opine.
A handful of years later, there I was on September 11, 2001, watching plumes of smoke from a wedge-shaped dent in the side of first one and then two towers. I was in the neighborhood known as the West Village, on Seventh Avenue, far enough away to be safe, but close enough to see clearly what was happening, and to feel with certainty that at least one building would fall.
Now, a terrible confession. I didn't really dwell on the people in the building, the horrible suffering and miserable deaths they faced. The other pedestrians on the sidewalk where screaming, crying, shaken. I was frightened and sad, but also, I was a little excited, like a scientist, observing experimental proof of a working hypothesis. There was history, I thought. Now begins a new period.
to be continued, thanks to any and all readers for your kind attention....
Let's discuss millennial optimism and post-2000 disillusion. Years ago, I read a history of the middle ages, in which there was a colorful description of the years 990-1000. Something about the impending round number had caused people throughout "Christendom", i.e. western europe, to believe that the world was coming to an end. Preachers preached doom and urged repentance, crowds gathered to wait for the demise of the world. This was, in effect, the end of the dark ages; at least in the view of that particular writer, a culmination of centuries of ruin and despair.
The very fact that the world did not come to an end, apparently, gave rise to a burst of optimism and the beginning of the more prosperous middle ages, which eventually in turn would give way to the renaissance and then finally modern times.
I read this passage with great foreboding; it was the late 1990's, the end of the next millenium was fast approaching, and western civilization was engaged in an orgy of optimism, which struck me as the opposing mirror image to the final decade of the preceding millennium. There were books with silly titles like "The End of History." The stock market was breaking effortlessly through to new records, 10,000 was followed by 11, then 12, 13 and 14,000. Internet stocks and frenzied day-trading seemed to fit the pattern, as did all the worldwide planning for end of the millenium parties.
There were occasional darker notes, such as the now largely forgotten hysteria over the Y2K problem -- the fear that computers were programmed to keep time in centuries, but would massively fail when forced to adjust to a change of the first integer, representing the millennial level.
But still, the celebratory atmosphere seemed to me a culmination of centuries which had been characterized by economic growth, the spread of democracy and the broad extension of rights -- things we take for granted like the elimination of slavery and women's suffrage. And if the despair of the 990's had given way to a new more optimistic way of thinking, would the complacency, enthusiasm and unrealistic expectations of the 1990's, be a precursor to darker times?
Of course, I knew it was sheer intellectual hubris to think in such vast over-arching terms. An unpublished armchair philosopher daring to contemplate the sweep of history. And I did not write or speak about it, except to a handful of people who are accustomed to my habit of developing pet theories about subjects on which I have no right to opine.
A handful of years later, there I was on September 11, 2001, watching plumes of smoke from a wedge-shaped dent in the side of first one and then two towers. I was in the neighborhood known as the West Village, on Seventh Avenue, far enough away to be safe, but close enough to see clearly what was happening, and to feel with certainty that at least one building would fall.
Now, a terrible confession. I didn't really dwell on the people in the building, the horrible suffering and miserable deaths they faced. The other pedestrians on the sidewalk where screaming, crying, shaken. I was frightened and sad, but also, I was a little excited, like a scientist, observing experimental proof of a working hypothesis. There was history, I thought. Now begins a new period.
to be continued, thanks to any and all readers for your kind attention....
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