This was appropriate as those benefiting from arms contracts are the usual suspects of the big business world-arms industrial producers-who have the least positive washback on the economy as a whole.
At the same time, America had to determine what to do to help the median income earners-as costs of living and education continued to grow through every single decade of the Reagan Bush experiments.
The quick fix "salvation" and source of profit for some giants, like Wal-Mart and thousands of America's newer dollar stores, was the opening up of China and Mexico to trade and investment.
In short, as the Reagan, Bush 1, Clinton,and Bush 2 economies have marched on through 2008, the quick fix to diminishing standards of living in the median household, Americans have found as the only solution these sort of cheap imports
That is, the quasi-free capitalism of Bush- and Reaganomics offered only cheap imports and new lower paid service industry employment to many Americans. (Meanwhile university education costs spiraled out of control. U.S. youth have to go to Cuba and elsewhere to study medicine. Thousands of other medical students' education costs continue to drive up America's health care industry-user costs each year.)
Besides recent pork barrel spending from the congresses under the George W. Bush Administration only the pharmaceutical and defense contractors have made out big-time under Busehenomics II.
On the other hand, the government-instead of demanding health care for all and other minimum standards as many a government has seen the right to do-, Bushenomics ans its forefather faiths I trickle-down economics and shock economic theory have continued to pretend that the spending practices of the Reagan era are still good models for America in the 21st Century.
Hogwash!As Beinhart says, America must throw out the Reagan and Bush mythology and move on beyond building a mediocre country and planet in 2008!
It is such a transformation in thinking and government planning which will be essential for a real recovery in America.
RECOVERY OF SOCIO-ECONOMIC CONSCIOUSNESS
Beinhart shares another economic parable that is accurate, but it should not be read as irony because the matter is too serious for the average American who cannot even dream of owning a home in 2008.
Beihnard explains how the credit economy benefits the bigger banks and wealthier lenders of the land without producing a building or any tangible piece of infrastructure themselves. (You may notice I am a fan of many credit unions-but not a fan of many banks although there are some good bankers out there.)
The example is concerned with housing loans but could apply to student, car, business, education, and other loan-including the usage of credit cards:
"You own a house. It's worth $100,000. Someone buys the house, no money down. They borrow that money. Let's say it's a straight 8 percent, 30-year mortgage. Forget closing costs, points, and any other complication-that's $220,000 debt. It goes on the banks books as an asset."
Beinhart continues with his parable, "Now you have $100,000. The bank has $220,000 (on paper). The buyer has a house worth $100,000. The bank has a lien on it , but the buyer will be gaining equity, plus he can get a second mortgage and home-improvement and other loans on it."
Concluding, Beihart notes, "Again, this is a vast oversimplification, but that transaction has 'created' something like $420,000 that is now "in play," as part of the economy."
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