Dispatch to My Fellow Americans #004
some thoughts up until the 2022 election
I am not a Democrat or a Republican. I am an unaffiliated independent. I am my own tribe, probably a part time anarchist in the original Greek meaning of the word (without ruler) on a private level. I rule myself through self-discipline as should all of us.
That said, let’s talk economy. This seems to be the biggest issue on the People’s mind. Yes, inflation is too high at 8.1 %. Interest rates for 30 yr mortgages have gone up to almost 7% as a way to create ‘Demand Destruction’: reduced demand, lower prices over time.
Let’s remember folks, we are coming off of ridiculously low interest rates that encouraged demand during the pandemic. The mortgage rate got down to around +/- 2% range. But that crazy low interest rate also drove up demand since, with lower interest rates, people could afford to buy homes because they could afford the monthly payments. Now with increased interest rates, that puts mortgages more out of reach. Hence demand destruction and eventually a drop in inflation. So everyone is whining or at least Republicans are telling you that you should be whining. This is a relatively short term problem if we don’t have more global disasters on the horizon.
Compared to the rest of the world we are actually weathering the storm pretty well. Globally, inflation is an average of 8.8% (in some places as high as +200% like Venezuela). This is a world wide problem not something created by Democrats as Republicans would have you think. Take a look at this chart…
https://fred.stlouisfed.org/series/MORTGAGE30US
Now let’s take a look at 1980 which is in the aftermath of the Viet Nam War where we spent way too much blood and treasure. But this was also the tail end of what was called The Great Inflation.
“Reagan's administration is the only one not to have raised the minimum wage. The inflation rate, 13.5% in 1980, fell to 4.1% in 1988, in part because the Federal Reserve increased interest rates (prime rate peaking at 20.5% in August 1981).”
It took the Reagan administration 8 years to get the inflation rate back down to 4.1 % and all along the prime rate went from about 20% down to about 10% in 1988. We are no where close to those kind of numbers and are unlikely to even hit the low end of the Reagan years.
Currently, the IMF (not the Democrats) projections are that the global inflation rate should be back down to 4.1% in 2024. That is only a year and a half or so from now. And if that is for global inflation, the USA should be a few ticks lower than that at maybe 3.7%. Which mean the interest rates can also be lowered back down as well. So let’s not get our panties in a twist over the economy. Politically it is a non-issue. Yes, it is putting some hurt on our fellow citizens but things will turn around and in the meantime I see a lot of effort on the part of the current administration to ease the pain as much as possible for as many as possible.
So, if the Republicans are in charge of the house or senate after this election, what are they going to do about the economy other than nothing and then claim they caused the naturally occurring drop in inflation in 2024 to happen?
The Republicans don’t have any plan and haven’t had any plan other that to sow discord and chaos and gum up the works and otherwise do nothing whatsoever except to complain about Democrats eating babies and protect Donald J. Trump for some inscrutable reason, end woman’s healthcare rights, end Medicare and Social Security, burn books, get rid of the Affordable Care Act, put pain at the southern border, encourage insurrection, defund and dismantle the DOJ, the FBI, the IRS, the EPA and the federal government as a whole for that matter (as we saw in the Trump administration). That is a big agenda I guess except that it is all Anti-American.
Do your American duty, get out there and vote. Democracy depends on all of us.
as Rob Reiner said: “A Vote For Republicans A Vote To Destroy Democracy”
If that happens we are in for dark times.
Hey Matthew, Yes, when it comes to reality in the socio-political realm it is really about consensus reality isn't it? What we can generally agree upon among ourselves as a basis from which to interact and make rational decisions. This is impossible to achieve on a social level if we can't recognize the common denominator which I am conjecturing is the collective idea of being an American whatever that might mean and beyond that, each individual as a human (which at one time was considered debatable by some).
Throw in a guy like Trump with his technique of calling in to question things that are beyond questioning and twisting things around to throw suspicion where nothing is suspect. It is just a technique of obfuscation and he does it over and over and his people keep falling for it. Mind bending.
Just the fact that we agree on the common ground of language and can understand each other on a linguistic level means we are accepting and sharing the common ground of language and all of its rules. If we were constantly questioning each other on the definition of every word and what is meant by it, we would quickly become unable to communicate in any meaningful way due to a breakdown of basic trust in how things work.
"Still, there needs to be a clear distinction between what is actual reality on the one hand and batshit crazy on the other. " Lovely thought, my dear Cecil! But there's possibility, actuality and necessity – and perhaps other states regarding "reality." Unfortunately when you say "needs to be" what is lacking – and it's not your fault of course – is enforcement. Reality is a crazy kind of love. But hey, I do love that you're doing this. And great name for the digital record of all things Touchon! M.