Thursday, September 3, 2009

Jim Stratton does the "Blogonomics" blog for the Orlando Sentinel. Today the topic was about 'mixed economic signals' with regard to month-to-month unemployment numbers. Seems like this guy loses the fact that the best his 'optimistic' argument can amount to is that "things are getting worse more slowly" as I heard Robert Reich say recently.

The retreat into false wonkery one sees in the likes of Stratton remind me of an analogy I saw made by George Monbiot in a GuardianUK column yesterday. in Monbiot's case the very economics-relevant subject was one of a pending international climate change summit and the likelihood that the participant nations are more than likely to ignore just-too-inconvenient new evidence that the already-dire models on which summit goals are organized around, are nowhere near good enough. Turns out things are even worse than had been figured (specifically, the planet looks much less capable of responding with any human-scaled promptness to a the kind of CO2 mitigation international leaders had in mind). The new evidence will prove, it's a safe bet, too much for the technocrats of our global capitalism to respond to, and so, Monbiot suspects, the summitt will devolve into squabbles over who's lookout this or that piece of the problem is whose:

"Unless there is a radical change of plan between now and December, world leaders will not only be discussing the alignment of deckchairs on the Titanic, but disputing whose deckchairs they really are and who is responsible for moving them. Fascinating as this argument may be, it does nothing to alter the course of the liner."

And so it is with Stratton's read on the economic troubles:

"Just released figures show that jobless claims fell a bit last week (a good thing) but the number of people still getting unemployment benefits grew (a bad thing)...Most economists say the recession is probably over, but indicators are going to be screwy while we bump along the bottom. And the patient won't really start to feel better until we get some job creation."

Of course when you think about it, the pathetic 'optimism' that comes with "jobless recovery" fine print is not really worth mentioning, actually. At all. It's an environment where entrenched power gets to dig in deeper. Wooppee.

But Stratton does mention it of course. After all, getting consumers to 'feel' better about things is the key to clearing the old economic pipes--so they'll spend money they don't have, if the dig-out from the early-2000s recession is any guide. A very poor guide, given that credit card bankruptcies are the stuff of a lot of people's nightmares--both waking and otherwise--right now.

Stratton poses the following low-confidence kink in the consumer-driven recovery scenario:

"...The nightmare scenario unfolds something like this: The labor market continues to deteriorate because businesses are spooked by tight-fisted consumers. More people lose their jobs, meaning less money flows into the economy.

A new round of foreclosures follows when people become unable to make mortgage payments. Meanwhile, folks who've held onto their jobs clamp down further on spending, fearing they'll soon be asked to clear out their desks.
That's not just theory. I see it every day..."

I don't doubt it. But what's frustrating is that the focus remains on this 'paradox of thrift' bit, never moving to the fact that Florida has structural problems extending far beyond what any jump-started (and really pretty irrationally-exhuberant, were it to materialize) consumer confidence could be expected to fix.

What's being overlooked is this: the soul of Florida's free market (sic) traditions has long been a growth-as-ponzi-scheme poor-man's ripoff.

Meaning today that the vicious recessionary haymaker Stratton describes actually comes wrapped in brass knuckles of elite stupidity. In a cracker-ass heritage of 'waste, fraud, and abuse' of the common wealth, and anything approaching long-run enlightened self interest.

To offer a (timely) Katrina analogy, Floridians are getting hit harder than most, and in a more sustained way, by foreclosure waves themselves (subprime, option ARM, recession-driven, residential, commercial), but also suffer from the shamefully faulty economic-developmental engineering of our state and local political classes and their proudly short-term thinking. The mentality: "Shitty labor market profiles are for tomorrow's public stewards--today, what's important is that taxes stay absurdly low". Busts are anomolies 'noone could have predicted'...and boom times are for crowing about how all boats are rising.

Ours is a long-recognized-as-problematic economic model held hostage now to
  • (a) tourists too insecure to keep coming, feeling in no position to be fleeced again as theme park throughput [And the OS ed board bashes Grayson for pushing prudently-targeted vacation-rights legislation designed to work as Disney-centric stimulus] and
  • (b) construction jobs whose workers are left to wonder where the entire 'bubble sector' they worked w/in has vanished to--a sector our ecosystems couldn't sustainably bear regardless [and so the OS ed board pours scorn on Hometown Democracy, natch].

Not that these are my ideas: An Aug 16 piece in the NYT ("FL: Which Way is Up?") and a Sept 1st San Antonio paper editorial ("FL - Uncontrolled growth no way to build economy") do a convincing job of telling the grim cautionary tale our state now exists to offer others.

For still more, you can't do better than economic development expert Richard Florida's Atlantic Magazine piece from March entitled "How the Crash Will Reshape America". Of a Central Florida-style "way of life" that author sees as now dead and gone, he describes the following: "...Cities grew, tax coffers filled, spending continued, more people arrived. Yet the boom itself neither followed nor resulted in the development of sustainable, scalable, highly productive industries or services. It was fueled and funded by housing, and housing was its primary product." Housing and, for us, low-wage, high volume tourism. Florida's view is that the localities likeliest to emerge stronger from this shitstorm are not us, but rather the anti-Orlandos:
vibrant, open, progressive cities rich with authenticity, and w/ leaders committed to the BUILDING of EXCELLENT and COMPELLING PLACES...not bubble-riders that build stadiums for billionaire hucksters, or who turn already-regressive regional transit infrastructure agencies into campaign cash machines.

Just when we need creative bold leadership, we find ourselves with Dyer (he of the stadium), Crotty (he of the corrupt Expressway Authority), Sansom, Crist, and policies like SB360 and the same taxes-are-evil voodoo-economic dogma that helped bring the house down in the first place.

The point is that his is WAY worse than a consumer-confidence based supply and demand problem; you'd figure a newspaper man might be a little hipper to problems of inadequate institutional structures and business models.


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