So far I am Equally Pissed at All of Them

I am beginning to regret my decision to stay politically involved. Once again, both mainstream candidates have begun to provoke my ire to the point of despair. This week my problem is with the central subject of both candidates’ recent rhetoric: “the economy.”

“The economy” described by Senator Obama seems to refer to the general financial welfare of the citizens of the United States. He describes a nation in which the ‘fatcat’s are getting fatter at the expense of the average workaday American. There is some evidence that such is the case. The fact that the per capita income of the average middle-class citizenry has declined while our gross domestic product has continued to grow (albeit slower than some might like) seems to point to certain inequities in the system. I mean, all that money has to be going somewhere, right?

On the other hand, “the economy” described by Senator McCain seems to refer to the productive power of the American people. He describes a nation in which the essential financial machinery is intact and viable despite recent events. In fact, from the ideological perspective of so-called free-market economists, such events are a healthy and necessary part of market systems. In essence the market is correcting itself. Thus the current financial downturn is simply a psychological response to natural market changes and the sooner we can get back to ‘business as usual’ the better. To quote the late FDR “the only thing we have to fear, is fear itself”. There is some evidence to support this viewpoint as well. We all know that the general financial welfare is supported by consumer confidence. It seems logical, if in fact the basic underpinnings of our economy are sound, to expect a rebound so long as people gain the necessary confidence to fully participate.

The fact that the candidates and their lackeys are using the same phrase, “The Economy”, to refer to two very different ideas allows both candidates the paradoxical luxury of being right and wrong at the same time. They can endlessly accuse each other of pigheaded blindness in the face of the “facts” while touting their plans and policies (or lack thereof) as the answer to all our troubles. This is a classic logical flustercuck (thank you Jack) of the highest order.

All of this would be amusing if it didn’t illuminate the fact that, if we take them at their word, neither candidate has any idea what the hell they are talking about. If we take them at their word.

But what if we don’t take them at their word? What if we assume that they are both intelligent and well informed and that they know perfectly well what they are saying? Then we are not dealing with mere stupidity or ideological blindness, but with the deliberate subversion of the truth to political ends.

I am not an economist and so my understanding of markets is limited at best. That said however, I think I have a very basic grasp of what the phrase “the economy” means in common usage. When we speak of the “the economy” we are really speaking about a financial ecology of sorts, a system of exchange between organisms (in this case, us). At its foundation, our human financial ecology is based on a key innate human trait: the desire to give and to receive, or reciprocal giving. In a market-based economy currency is given with the expectation that the receiver will reciprocate by giving me a product of some kind. I give you a dollar with the understanding that you will then give me a candy bar, and what we have between us is an economy.

On a national scale the complex web of all these personal exchanges, agreements, and expectations make up “The Economy”. The current economic crisis is a result of a breakdown in the personal exchanges, agreements, and expectations regarding just one product: credit.

If you picture the American economy as a giant machine filled with an infinite number of moving parts; credit can be likened to the lubricant that keeps the machine running smoothly. Just as with any machine, points of contact between moving parts can create friction. Credit eases this friction by extending the terms of exchange agreements over time. Continuing with the metaphor; the productive powers of a well built machine can be increased dramatically with the judicious use of a lubricant. That said however, even a machine with ill-fitting parts can be made to continue working almost indefinitely if you pour enough grease into it. But what happens to the machine when the lubricant dries up? If the machine is well designed and maintained the engine can run for a time without the aide of a lubricating agent. But given enough time, a poor design or poor maintenance the engine begins to overheat and will eventually seize up.

What we are seeing right now in our economy is what the machine looks like with less lubricant. Over the last decade we have been pouring massive amounts of lubricant into the national economy with the belief that if a little helps, a lot will help a lot more. Whether or not such is the case is a question I will leave to much brighter minds.

The argument between the esteemed senators is at its heart an argument about what the machine actually looks like without all that grease in it. One candidate is pointing to apparent design flaws while the other is pointing to the productive power of the machine claiming that all it needs is a little oil and a little time and things will be back to normal. Both ideas have merit, but both ideas are also ideologically based and as such are untestable. The American economy is so big and so complex that no one theory can predict how it will behave all the time. Which economic theory you personally subscribe to is a matter of preference and sometimes faith.

What makes me lose sleep in this whole thing is the fact that there is in fact a time-tested means of increasing economic behavior and thereby improving the overall long-term health of the American Economy.

The answer: INFRASTRUCTURE.

Improving infrastructure always improves commerce. Roads, railways, airways, telecommunications systems etc… these are the ways we create the necessary points of contact between people so that they can do what comes naturally: exchange. If you increase people’s access to each other you will increase economic behavior.

Furthermore, the need to improve our transportation and communications infrastructure seems obvious. Every emergent economy in the world, China, India, Russia, is succeeding as a direct result of their investment in their own ability to move products, people , and ideas from place to place securely, efficiently and quickly. Our aging infrastructure is sadly outdated, sometimes dangerously so. We are still coasting on the work of FDR and Eisenhower who were the last presidents to put serious effort and investment towards our ability to connect with one another physically. On the virtual front we are well down the list of countries as far as competitive telecommunications systems go.

Investing in infrastructure as a method for spurring economic behavior is so incontrovertibly effective as to be utterly without controversy. And no one is talking about it. Why? Because it isn’t controversial, because it isn’t an issue that will make us fear what will happen if “they” (Democrats or Republicans) take over, and because it doesn’t help either side to win their ideological war for the hearts and minds of the American people. In short the reason is politics. And it pisses me off.