Comment by DanielBMarkham | Hacker News Reader

Comment by DanielBMarkham | Hacker News Reader

The U.S. has gotten progressively worse and worse at handling recessions, and yes, it's in no spot to handle the next one.

But this is nothing new. It's been heading this way for a long time. You could have ran this same article a year ago before the current administration took over.

I don't want to mention politics, but politics plays a big role here. When your party is in power, life is good and spending is easy. When your party is out of power, hard times are coming and we should prepare.

The state of the nation doesn't flip around that quickly. Instead it's all about long-term trends like debt and interest rates. But by viewing all public policy through a partisan lens, it allows folks to always blame the "other guys".

It is a dysfunctional political system that's led to a dysfunctional financial system. I think the U.S. might have another decade or two, but one day, being the world's reserve currency ain't going to cut it any more. That day is going to suck.

Democracy does seem to have a problem delivering fiscal responsibility, it's too easy to put it off for the next government.

The problem is larger than fiscal. It’s about long term thinking in general. We have no common cause, vision or “myth” to gather round.

I was thinking this the other day actually. That we are generally best served when people extrapolate their interests for the long term. And this is a big part of religion and faith. But they don't always help people value the collective long-term interest.

Common rallying causes have been systematically dismantled.

You can't be patriotic because our history isn't perfect.

You can't be religious because it might offend someone.

God and country have been the common denominators of our culture and they are no longer seen as relevant, and there is nothing else to replace them. It seems like we are more interested in finding and emphasizing all the ways we are different from each other rather than rallying around anything we might have in common.

> You can't be patriotic because our history isn't perfect.

This is untrue; very few people have a problem with patriotism. Lots of people have a problem with various forms of nationalism, but none of that is about imperfection of history except insofar as certain breeds of nationalism center around glorifying and recreating bad aspects of history.

> You can't be religious because it might offend someone.

While this has always been true to an extent for faiths other than than that of the most dominant local form of Christianity, it is less true (not more) now than in the past.

> This is untrue; very few people have a problem with patriotism.

Look, I come from the left. Growing up, there was definitely the sense that it is in poor taste to express enthusiasm about America or being an American. That it was something reserved for red necks who drive pick up trucks. The American flag, as a symbol, was considered gauche and the only time you would wear anything with the flag on it is if you were being self-consciously ironic. There was no sense that America was great. Instead, the focus was almost exclusively on America's flaws.

This critique is overly focused on shallow aesthetics ("gauche", "pickup-trucks"), which really have nothing to do with patriotism, and more to do with some kind of tribal name-calling, which I'm sure takes place on both left on right. It is just as patriotic to acknowledge and grapple with a country's flaws as it is to express pride in one's country. There's no contradiction between the two.

In my experience, there is a deep vein of antipathy toward America on the left. I brought up condescension toward the flag because I think it is emblematic of that antipathy. I mean, the flag is just about the purest symbolic representation of America that exists. So if your attitude toward it is that you wouldn’t deign to adorn yourself or anything you own with it, and you disparage it as fitting only of some lower class, what viable interpretation of that fact is there other than that you feel negatively about the thing which it represents?

Or perhaps another way to think of it: if you had a friend who, every time a certain person came up, immediately started to enumerate that person’s flaws, what would you conclude about their feelings toward that person?

I don't think its offense that has killed traditional religion. After all, the religious types have traditionally been one of the loudest political groups in the US. People willing to hold up signs with dead babies to send a political message don't appear to care about offending others.

I definitely see that Christianity is getting less-and-less relevant in the US (as it has been in most other Western nations), but it seems like patriotism is its replacement, the Constitution is the new Bible and the founding fathers are the new apostles.

according to most of the histories I have read monarchs and dictators have not been well known for fiscal responsibility either so I am not sure if this is a democracy problem.

You can't logically conclude that it's not a democracy problem simply because you named a separate condition that implies lack of fiscal responsibility.

yes, but if fiscal irresponsibility is present in democracies, monarchies, dictatorships, corporations of all sizes, and of course individuals, then on what basis would you claim that democracy has a unique problem with fiscal irresponsibility?

Where's the system that doesn't have this problem, I guess is my question.

Here in the US it is evident that we have plenty of resources available, the "supply" part of the economy is working great. There are people that have limited access to this fountain of goods, probably for multiple reasons.

There's an argument to be made that making a number bigger in a ledger for the sake of increasing access to that fountain of goods is not a "crisis".

200+% inflation rates destroy the meaning of any such ledger really quickly. The US had 17% inflation rates* fairly recently and just avoided that cliff.

Higest short term rate listed: 23.7% in june 1920. http://www.usinflationcalculator.com/inflation/historical-in...

> The US has 17% inflation rates fairly recently

I'll bite. What's your source.

17% is a little high, but I'm guessing the GP is referring to 1980:

https://en.wikipedia.org/wiki/Early_1980s_recession#Inflatio...

Annual inflation capped at "1980 soared to 13.5%", but the inflation rate spiked above that in the same year.

http://www.usinflationcalculator.com/inflation/historical-in... lists a peak of 14.8% but if have seen 17% elsewhere.

1917-1920 had some periods over 20%.

I'm suspicious that Volcker breaking the back of inflation is one of the factors behind lower growth over the last 30 years.

The theory being that the Fed is good at balancing growth and inflation but too conservative.

Well, sure, in theory, but he deliberately induced a recession, right? It seems like a plausible claim to me. http://theweek.com/articles/618964/forgotten-recession-that-...

Or, more cynically, you can deliberately create fiscal crisis conditions to justify cutting programs you wanted to get rid of in the first place.

The cynic in me believes that sort of scheme is SOP in the US. Here are CA lawmakers back in 2003 weighing the benefits of prolonging the budget crisis for leverage to push through tax increases: http://articles.latimes.com/2003/jul/22/local/me-budget22

Don't over-generalise from the USA. There are plenty of democracies that run balanced budgets and thus don't have a deficit, or even run a surplus. For example, Germany, Switzerland. The UK government has won the last three elections on a backdrop of "we're going to cut spending still further to try and balance the budget" and voters supported that.

The USA is actually somewhat unusual amongst democracies in how little effort there truly is to reign in spending. The Republicans seem to have lost any ability to enact real policy. Only the Dems seem able to make major changes to US society and it's always in the direction of more spending. When the Reps get in, they seem too weak, too divided and too beholden to the military to pass any real spending cuts.

The UK government has won the last three elections on a backdrop of "we're going to cut spending still further to try and balance the budget" and voters supported that.

What they promised and what they delivered were two different things.

The deficit has halved. They promised it'd fall even faster than it did, but my point stands - democracy is not incompatible with responsible spending.

>The U.S. has gotten progressively worse and worse at handling recessions

Recessions have been fewer and lest frequent according to the data. What are you looking at that disputes this?

I'm guessing that, like the article, he's talking more about mitigating the pain of recessions for the average person.

>he's talking more about mitigating the pain of recessions for the average person.

So your claim is that the pain of recessions for the average person have been getting worse over time? Where is that evidence? I don't see it.

Unemployment during the depression was around 25% and people were starving.

Ok, but how about if you stick to the postwar period?

Here's my take. Postwar, inflation at the peak of the business cycle was rising every cycle until 1980. Then Volcker clamped down on inflation, and since then inflation as dropped each cycle. Unfortunately, unemployment at the bottom of the cycle has also grown with each cycle.

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