Dragaera

Hello, I'd like to have an argument (was Re: duh!)

Thu Feb 3 06:00:34 PST 2005

On Wed, 2 Feb 2005, Gomi no Sensei wrote:

>"The economy is global, but political government is
>still determined by nation-states" is about as
>contradicting a statement as 'Water is wet, but
>stone is hard'. Different objects, different
>properties. The economic crises that do occur are
>generally traceable to interference with the
>operation of the market and poorly crafted and
>enforced property rights.

Government is about economics.  If it weren't, then
why would the one common feature of modern governments
be taxation (aka resource management or the choice
between winners and losers)?  Put simply, the
government's main duty, taxation, is interference in
the market.  You should read Barnett's (Sp) new book
_The Pentagon at War_.

Let's look at a few of the more recent "economic
crisis."

Very Possible:  The crash of the dollar due to
excessive government deficits, too little savings by
the American people, and the rise of a suitable
competitor in the Euro.  The best way to prevent this
crisis - cut the budget deficit and interfere with the
market by encouraging the American people to save more
money.

1.  Minor recession of 2000 - 2004: A small
business-cycle recession made worse by the destruction
of America's best known office building by
international terrorists.  You could call it an
interference in the market by terrorists, but a better
description would be a recession caused by the
government's failure to provide security to its
market.

2.  The Asian Flu of the mid 1990s to present:  caused
by numerous bad choices by Japanese banks as to whom
they loan money (due to cultural factors and the lack
of oversight by the Japanese government).

3.  1970s Inflation crisis:  caused in large part by
the strain placed on America's economy by the Vietnam
war and the breakdown of the Breton Woods system.

There are other examples but I think these make my
point.  An economy is an engine but government
policies, at least in the modern world, are the
lubricant.  Globalization is nothing more then the
extension of America's economy to the world.  It can
be compared to a worldwide system of government
because it is one, and the dollar is king.  If America
falls so does globalization.