Recollections of the Past

Over the past dozen or more years I’ve filled many a page with all sorts of ramblings. My average ramble might run 600 to 800 words, but when I get wound up on an enticing topic, the verbiage can flow on and on. Despite my dedication to a subject, I’d occasionally start an article enthusiastically and run out of passion along the way. When this happened the partially completed brief often ended up in my dead-essay file for possible use in the future.

I must now confess I’ve never dredged a single sentence from the file; everything’s still sitting there unloved and ignored these many years. However, this past weekend I revisited the file and found a few morsels of commentary which apparently weathered the ravages of time. I invite you to join me in reliving a bit of the past. Just so you’ll know, I’ve not altered a single word of any of these articles; they’re exactly as I wrote them at the time.

*****

The lessons of history are clear. The earliest empires were built around metal technologies. Less advanced peoples were conquered by those skilled in forging iron and making tough bronze by adding tin to copper. If America is to compete successfully – indeed, to survive – in a hostile and increasingly technological world, it must encourage its most talented citizens to strive for achievement in the physical sciences.

Unfortunately, due to political considerations, United States educational emphasis and funds normally encourage the wrong schooling to the wrong persons for the wrong reasons. With little or no comprehension of the practicalities, it selects equity in preference to excellence. Thus the government’s educational largess, flowing in abundance, is directed, not toward the students of ability who major in STEM subjects and enhance the nation’s well-being, but instead benefits the least talented among us. As the nation’s electorate seems to favor this system, the results are predictable: We spend an eternity and a fortune vainly attempting to overcome scholastic failure.

*****

A thought on the recent Supreme Court’s Obamacare decision: From the beginning most of us expected a 5 to 4 decision. As seemed reasonable, we presumed the four right-wingers would rule against the health care law while the four left-wingers would rule in favor of it. Justice Kennedy was expected, as usual, to be the swing vote. So the question now bandied about is: For what reason did Justice Roberts vote in favor of Obamacare, as he did?

I’ve heard a number of responses, with many Republican spokesmen attempting to rationalize it with all sorts of contrived nonsense. Most of the explanations are simply whistling Dixie. However, I harbor a suspicion. If Roberts were simply an associate justice, he’d have sided with the other conservatives in opposition to Obamacare. However, as chief justice, he has a position to maintain and, more importantly, a legacy to consider.

I’m guessing his recollections go back to the Bush-Gore presidential decision of 2000, where the court simply ruled 5 to 4 their buddy beat the other guy. I believe this to have been firmly in the back of Roberts’ mind when he cast his vote as he did. If he sided with the conservatives, as did Chief Justice William Renquist on that particular decision, he envisioned going down in history in much the same was as did Chief Justice Roger Taney, the architect of the 1857 Dred Scott decision, as nothing more than a party ideologue.

And this is not the first time such a consideration became a factor in a Supreme Court decision. I’m convinced Chief Justice Earl Warren’s efforts in the Brown vs. Board of Education 9 to 0 school integration decision of 1954 was in direct response to his desire for posterity to forgive him for his 1942 activities, as California’s Attorney General, in cooperation with the Franklin Roosevelt administration, in sending 120,000 mostly loyal Japanese-American citizens to concentration camps.

*****

The Muslim terrorists enjoy a distinct advantage over us, by their possession of a 21st Century technology while at the same time a 12th Century mentality. This is a potent combination, for you can conduct hostilities far more effectively when you needn’t concern yourself with such distractions as human values, public perception or morality. Their only disadvantage is the deleterious side effects of religious fanaticism: a lack of realistic perception and an absence of rationality.

It appears many of the world’s leaders either fail to recognize or refuse to acknowledge reality. Whether the many nations undergoing attack on their western values will eventually succumb to this malignant version of Islam is uncertain, but the current transformation evident in certain European countries suggest this Muslim Crusade in reverse may be successful.

*****

I'’ve watched the U.S. government in action for many decades and realize the political community displays no ability to deal wisely with economic issues. Admittedly, by their ability to confiscate the citizens’ property through taxation and their authority to impose restrictive regulations, they can certainly impede the workings of the economy. However, they possess no power to legislate general prosperity. It’s for this reason each official normally tries to portray himself as a champion of the constituency by which he owes his particular position, while doing nothing to improve the nation’s well-being.

My prediction: Economic hard times are in America’s future. Irrespective of the unemployment rate of about 10 percent bandied about by the Labor Department, we’re at an actual jobless rate well into the 20 percent range, and most of the employment positions lost are not coming back. The expectation home values, now down over 50 percent in some areas, will return to pre-Great Recession levels is quite likely. However, many of those who will lose their homes will not recover.

As for the prediction of a double-dip recession, I don’t believe we’ll see one. What we’ll actually see will be a resurgence of prosperity for certain favored segments of the population, while those in and below the middle level will remain mired in misfortune and at a perpetual disadvantage.

I truly fear a large segment of Americans will experience many years of economic malaise. The world is rapidly uniting in unique ways – communications, travel, interdependence and a sharing of everything. Like it or not, our nation is becoming a more integral part of this world and cannot escape being drawn into and downward toward the poverty existing elsewhere. How can our standard of living prevail when we must cohabit the globe with societies whose citizens subsist on $2.00 a day? The concept of “Buy American” may convey a patriotic ring, but how many of us will pay $30 for an American-made product when the Chinese-made equivalent sells for $4.95?

The end is easily foretold. U.S. wages must eventually come into line with those of the undeveloped world and the relative prosperity we reveled in during the 20th Century will not be matched in the 21st.

As for our government’s response to these problems, you may expect the usual. There’ll be a succession of super-committees formed to divert attention while the governmental apparatus systematically encircles its citizens, confiscating whatever it can get its hand onto. The crisis will serve as ample justification for the policies they will institute. This will be possible because the majority rules, and by then the have-nots will far outnumber the haves.

Understandably, the well-to-do will be stripped of their assets – but only in the nation’s best interests, of course. If there’s a moral, it is: And so it only goes to serve, that people get what they deserve.

Al Jacobs, a professional investor for nearly a half-century, issues weekly financial articles in which he shares his financial knowledge and experience. You may view it on http://www.roadwaytoprosperity.com

al@beachcomber.news