Economics for dummies

Share on Nextdoor

Here’s something you ought to think about. Our lifestyle is now entirely dependent on the willingness of foreign nations, most of them far poorer than we are, to lend us vast sums of money — about $1 billion — every day.

That’s what the federal budget deficit really means. Additionally, we’re transferring another $2 billion of our net worth abroad every day by buying far more from other countries than we sell to them.

You don’t have to be an economist — which I emphatically am not — to know that this can’t go on forever, and that sooner or later our economy is likely to crash and burn. Not only does nobody seem to know what to do about this, no politician even seems willing to try to address the problem.

One of the reasons the shell game has kept going on so long is that much of the world has a vested interest in the magnificent illusion of America as the world’s glittering economic superpower and safe investment harbor.

Yet imagine the Chinese, for whatever reason, stopped lending us money, or the Saudis stopped investing theirs here. The dollar, some economists think, could lose half its value overnight. When I was young I was reassured that thanks to the trauma of the Great Depression, the government now had all sorts of safeguards guaranteed to prevent another economic collapse.

Later, I realized that the people who were in charge of economic policy were the same geniuses who gave us Vietnam. Now think about the gang that’s running things these days. Congress is soon going to vote to borrow another $80.5 billion for our wonderful war in Iraq. Interestingly, the same Senate committee that approved that last week also voted against providing a little extra money to investigate the widespread charges of fraud and corruption against Halliburton and other U.S. contractors who will get much of this money.

Makes sense to me. That appropriation for the bottomless pit of Iraq, by the way, is more than 200 times what it would take to bail out the city of Detroit, which is likely on its way to economic receivership. Kwame Kilpatrick issued a draconian budget last week that has no money at all for institutions like the Detroit Zoo and the Detroit Historical Museum, and even that won’t be enough to balance the books unless the unions agree to further concessions.

Though I haven’t been a fan of the mayor’s, it is hard to fault him for this budget, or to see how he can do anything else, other than strive to maintain some minimum, bare-bones level of public services, such as police and fire protection. The money simply isn’t there, and it’s no use even asking the gutless wonders in state government, which is itself insolvent, for help paying the bills.

Thirty years ago, when Detroit faced another crisis, a Republican governor named William Milliken managed to get the Legislature to give the city some financial help, particularly in saving the city’s cultural jewels, like the Detroit Institute of Arts. The present Democratic governor wouldn’t dream of suggesting help for the state’s largest city now, nor does she have the political capital needed to get the lawmakers to do anything for Detroit.

Sweeping down from the hills to scavenge the stricken, L. Brooks Patterson obligingly suggested that the Detroit Zoo might become a part of the Oakland County parks system, which I guess would mean that he would get to put his name, rather than Kwame’s, on the long-empty water tower.

Possibly he could add a giant tongue sticking out at Detroit. If there’s any sign that things will get any better for the city economically in the near future, I can’t see it. Nor do I see how the city’s government can do anything meaningful to halt the city’s slide toward insolvency and receivership.

The real mystery is not why we’re so shortsighted and selfish that we refuse to do anything about this. The mystery lies in how any of us, even the wealthiest suburbanites, can sleep securely living around the perimeter of a devastated city full of increasingly desperate and hopeless lives.

Well, our president doesn’t see the national and global economic train wreck coming either. Yet while we’re ignoring these threats to our future, we’re at least all over one major problem that threatens our security as little else has, namely, the terrorist threat from our menacing neighbor to the north — Canada.

Ever since Sept. 11, the government has been bizarrely preoccupied with security questions concerning what used to be referred to as the world’s largest undefended border. Early on, newspapers like the New York Post reported that the hijackers and others “bent on wreaking havoc in the United States” had found a virtual haven for terrorists in Canada.

Not one word of this was true. Not a single one of the hijackers came through Canada. There was an Afghan who tried to come through the border in Seattle with a carload of dynamite in 1999, and the Canadians caught him. Nevertheless, both governments have spent since what must be hundreds of millions trying to make the borders more secure. Mainly, they have made them more inconvenient, at considerable economic cost to all.

Traffic through the Detroit-Windsor tunnel has declined by 37 percent since Sept. 11, according to Crain’s Detroit Business; this is the busiest border in the nation, with $150 billion in goods going back and forth each way.

Yet two weeks ago, not satisfied that things were screwed up enough, the Bush administration announced that within four years, everyone wanting to re-enter the country from Canada, Mexico or Bermuda would need a passport.

What motivated this wasn’t clear, unless the passport office was trying to raise its revenue, or some in the government were absolutely hell-bent on finishing the job of ruining the restaurant business in Windsor.

Within a week, however, not only did the Bushies back off from this cuckoo idea, Dubya himself claimed he had never heard of the passport plan. My suspicion is that he and a number of congressmen heard from a lot of Texans and other red staters who can’t easily afford to shell out for a passport, but who frequently need to go back and forth across the border.

Still, part of me thought the passport plan might have been a good thing, since it might have helped some of us realize that Canada is a sovereign nation deserving of respect. Even if a lot of them speak French.


Television For dummies: WDIV’s news ratings seem to be slumping since anchor Emery King was dumped, according to figures supplied to me last week. Whether that has anything to do with his dismissal is uncertain, but the station seems to be losing ground to WXYZ, even though viewers there have to endure the boorish Steve Wilson, who’s out of his element when not mixing it up with Kwame Kilpatrick’s goon squad.

Last week (as the Detroit Free Press amusingly showed) Wilson was made a fool of by the mayor of Warren, and by a 21-year-old student of mine who works for Warren TV. According to Angela Blanchard, when she tried to ask the baron of boorishness a question, he blustered, “You aren’t as cute as you think you are, and you should stop trying to get by on your looks.” What’s appalling is that in a negative sense, Stevo seems to be trying to get by on his.

Jack Lessenberry opines weekly for Metro Times. Send comments to [email protected]
Scroll to read more Metro Detroit News articles


Join Detroit Metro Times Newsletters

Subscribe now to get the latest news delivered right to your inbox.