TED Conversations

This conversation is closed.

Save our Economy? Is it even possible? Is this the death of prosperity?

Watch this video: http://www.youtube.com/watch?feature=player_embedded&v=QPKKQnijnsM#t=0s

For as long as the top 1% of Americans control 40% or more of the nation's wealth . . . do we even have a reason to hope for the future? We have always believed that our future would be much better than our past, but will it? As the middle class shrinks, what is the future of Democracy and a Free Market Economy?

I like the opposing view much better. That is:
http://www.ted.com/talks/erik_brynjolfsson_the_key_to_growth_race_em_with_em_the_machines.html

But the cautionary view of Robert J. Gordon is more valuable. He cautions us on the issue of change. That is: We MUST! We can do no less for the sake of our children and their future.

I believe that between 1950 and 1970, our country experienced a period of unprecedented prosperity. And I am not sure that even those PhD, Nobel Prize winning economists and other Ivory Tower guru's have a clue as to what it was that made the U.S. economy the envy of the world! But whatever it was we did right before, we gotta do it again, and quickly! For the sake of our kids, we'd better.

Share:
  • May 9 2013: Stiglitz a Nobel prize winner in economics wrote that the American Dream is dead.
    • thumb
      May 9 2013: Maybe not dead, but certainly on life support.
    • thumb
      May 9 2013: Are you refering specifically to a new generation expecting to be better off than their parents?
      • May 10 2013: Okay that's one of the consequences of the collaqpse of our wage structure. Notice that no politician of either party is willing to talk about this.
      • thumb
        May 10 2013: Hey, from WW II forward, every generation has been better off than their parents before them. Today, that isn't true anymore.
        • thumb
          May 10 2013: I only asked because there are various things that are sometimes called the American Dream.
  • May 9 2013: We live in a corporatocracy! By such, the middle class is whatever they claim and allow. They have slain the golden goose. It is unsustainable, but they will ride it down to the end.
  • Comment deleted

    • thumb
      May 9 2013: Screw the math
      • thumb
        May 9 2013: You got that right, buddy!
        Screw the math.

        What scares me though, Congress does it all the time. And I try to vote for the ones willing to do the math and deal with reality (for a change)!
    • May 9 2013: Juan - China has the courage to do what America did to industrialize. Our leaders the corporate socialists chose to do something else. They the corporate socialists contribute to both parties. There is another way It's never just Yin or Yang. Welfare in America doesn't go to the poor, I am not going to do an Earnest Jones poem. On yes, and economics is not physics. It was more like science at the time of Ricardo and Malthus. Malthus was an influence on Darwin and Wallace. Backing up physicist Ed Thorp of black jack fame did some remarkable things in Hedge funds. See Quants. Also read Taleb's Fooled by Randomness and Black Swan. The popular economic model suggests that these models do not work as they do.
  • thumb
    May 8 2013: Juan, You have come to the proverbal fork in the road. If you opt for socialism and the Keynesian theory of economics or if you select Capitalism and the Austrian theory of economics will set you on very different paths. Each has its good and bad points ... however the long term effects are very different.

    The easiest way to show you is to study Argentina of the early 1900's and see what the cause and effects were. You rile and curse the 1% .... see what happened when Argentina took all of the wealth away from the owners and rich. Then only the elite government "party" people had money, power, and position. After they took the money from the rich then they took from the middle class and then the poor and nothing worked as the government was to big to be supported.

    Be careful what you wish for .... you may get your wish. You could not be from the USA and have these thoughts as you are seeing the country going down the drain .... it has zero to do with the wealthy. Don't drink the koolade!!!!

    Bob.
  • May 8 2013: Economic teacher Richard Wolf look him up he already has a smart action plan for a better economy.
  • thumb
    May 8 2013: I doubt it's the end. There are always more of us than them if you know what I'm getting at. ;)

    But honestly, history has shown that the middle class always recovers.
  • thumb
    Jun 4 2013: A quart of oil costs more than a gallon of gasoline.

    A gallon of gasoline costs more than a gallon of milk.

    And milk is always over $3.00 a gallon.

    And half the country blames Obama . . . what do YOU think?
  • thumb
    May 22 2013: Having researched many of these issues on the internet, I am more deeply concerned than ever. In Europe, the largest group of unemployed citizens is the youth. And, in the past, unemployed/idle young people risk 1) falling into despair; & 2) striking out in anger & violence. Something needs to be done. Otherwise, social unrest is inevitable.
  • Comment deleted

    • thumb
      May 16 2013: If you are angry about this then somebody planted the seed of anger in your head, which was probably the media.

      Consider how Gates goes on about the shortage of programmers so they need to increase the H1B visas well that is bs. There is no shortage he just wants to get cheaper labor here.

      Buffet says everyone should pay more taxes but he does not pay more as most of his money is in capital gains which will then be given to the Gates charity which will be tax except.

      I have no problem with either making money but when they game the system through cronyism and tell others they should pay more yet they don't it is hypocrisy.

      I wonder if you realize is that economic opportunities are a reciprocal of government overreach? In other words as government grows private enterprise shrinks. It has the additional problem of discouraging investment which is what creates ALL new jobs. The media would have you believe that jobs are created by government spending. But this is not true only a initial burst for some imaginary jobs at companies that are subsidized. This is the reason there are so few jobs right now which is the exact same reason there were so few during the great depression.
      • thumb
        May 16 2013: Pat, in all honesty, I don't know. When I go back and read what I said, I guess I just want things to be fair. And whatever our country was doing right when I was a kid, I want us to go back and do that again. And the way things are going, once we figure out what it was that made the difference back then, we don't have much choice. Whatever it was that we did right before, we have to go back and do that again. We'd better do it fast. And we'd better do a lot of it. I need to say that again, we better do it fast and we better do a lot of it. Otherwise, things will get really bad; maybe as bad as the Great Depression.

        I believe that between 1950 and 1970, our country experienced a period of unprecedented prosperity. And I am not sure that even those PhD, Nobel Prize winning economists and other Ivory Tower guru's have a clue as to what it was that made the U.S. economy the envy of the world! But whatever it was we did right before, we gotta do it again, and quickly! For the sake of our kids, we'd better.

        Yesterday I was looking at https://www.khanacademy.org/. I never studied Economics or had that in High School. They have some basic teaching in that. They have some videos that might be just like I'd have had if I'd been able to study that in High School. They got this stuff called macroeconomics and micoroeconomics. Maybe I'd better go take a look.
  • May 16 2013: How is the government going to protect the middle class? The government is the problem. Both democrats and republicans support big business and special interests in their own way. The real answer is to get the thumb of government off the free-market dial. Fact.. 1 of every 4 Americans make $100,000 plus a year and the vast majority of people with money do it legitimately so stop accusing your lack of success on "them." This is America Go be somebody.. if you cant make it here than your in trouble.
    • thumb
      May 16 2013: Thank you for your thoughtful and insightful comment.
      First, no one is asking anyone to protect the middle class. My dad had a bachelor's degree and was able to buy a brick, 3 bedroom house w/a brick 2 car garage in 1966. He did this when he was 33. Now day's you need a Master's degree, some luck, and a twenty year work history to get the same house for ten times as much with payments that are ten to fifteen times higher.
      Second. I agree with you that both the democrats and republicans are not doing their jobs. I elected my senators and congressman to watch over our tax dollars; keep our military strong; and help protect our children's future. That's what they promised. They need to deliver or get fired. That's how it works for the rest of us! That's how it should work for the government as well.
      Free market? What does this mean: http://www.usdebtclock.org/
      Back in the fifties and sixties the men who had fought on the battlefields of Europe and Asia were running this Nation. They fought side by side and saw men die. Bankers fought beside plumbers, engineers, farmers, lawyers, accountants and businessmen. After they defeated both the Nazis and the Imperial Japanese they came home and they did not forget who they had fought with or what they had fought for! That businessman came home to his business and did his part. He paid a fair wage for a fair days work. That's the least he was obligated to do for the men who had fought beside him. It's only right. If that businessman owned his business he took a fair share of the profits AFTER he had taken care of his employees and their families. THAT is the American way! The men who had made the biggest investment in the success of the business got what they earned as a living wage. Men could own homes, buy cars and send their kids to college. People had hopes, and dreams, and they knew that in America they could make those dreams come true. But the men who owned and ran the businesses were fair.
  • thumb
    May 16 2013: From what I heard on the News today, (the non-Fox, not-AntiObama news) . . . from what I heard on the news today, the Federal deficit is now lower than it has been since 2008. My theory is that it is probably the lowest it has been since 2004 or so as we are no longer fighting two wars off budget and off the books. (Iraq & Afghanistan - lest we forget!). I find the falling deficit interesting for two reasons.

    First, we are STILL in deficit! We are NOT building our economy on the same solid principles with which we run our households (Pay as you go, save for retirement, save for a rainy day, put some money away for your kid's college, buy insurance on your house, life, and car, keep the checkbook balanced. Have a savings account with the checking account. Keep the credit card debt low. Buy a house when you can.) The size of the debt seems unsustainable. And nothing we do seems to make any difference.

    Second, our economy has become absolutely technology dependent. And unless we clean up our education system and make a bigger investment in getting our kids educated, that won't work either. The only way we have left to manage our debt is by technological innovation. We have to make the next big discovery. And we have to make that discovery work. We have no choice. Otherwise, we fall back into those familiar rules I list in #1 above. And our quite frugal parents and grandparents would have a fit were they to see how profligate we have been. All they taught us about minding our money and saving for a rainy day was wasted. We have greatly disrespected their teachings and their memory. And that's just in the U.S.A. How's it going elsewhere? Economy good where you are? If so, why?
    • May 16 2013: I know of a way of settling our debt.. WE SHOULD STOP SPENDING MORE MONEY THAN WE HAVE. Obama has spent a ridiculous amount of money in his presidency and Obamacare hasnt even been in effect. Our federal deficit is higher than it has ever been.. since God knows when we havent had a balanced budget.
  • thumb
    May 10 2013: Me either -- but the possibility that it is gets me really scared sometimes.
  • thumb
    May 10 2013: don't know
  • Comment deleted

    • thumb
      May 9 2013: He is jail for not paying his taxes. I just like the simplicity with which the video was done. I would not recommend not paying your taxes.

      The problem with main stream economics is that it is more about consensus than truth or workability .
      Probably 80% of what you will read is not true.

      A couple of touchstones that I use on the subject are:

      Does the author give lots and lots of examples or does he give lots and lots of theories.

      Does he use this definition of economics: Economics is the study of the use of scarce resources which have alternative uses. As you will not hear much about this from someone who espouses to Keynesian economics.

      Does the study create a way of predicting the future of the economy given certain factors and does it actually predict outcomes.

      You also might look at this website:

      http://mises.org/
  • thumb
    May 8 2013: The question is what causes economic prosperity?