OWS and Big Labor Hands China Economic Dominance

Posted: Nov 02, 2011 12:01 AM

According to Goethe, “Nothing is more terrible than to see ignorance in action.”   

No doubt Goethe would have been twice as appalled to see two different but similarly insensible forces acting in combination.

That’s what’s happening today as organized labor lends its considerable resources to train, fund and direct the fatuous Occupy movement.

These bedfellows are not so different as they might first seem.  Both Labor and Occupy bemoan a dilapidated economy that can’t create jobs; both blame capitalism for the paucity of those jobs, and both are bent on a series of actions that assures the U.S. never sees the jobs they each claim to want.

Their miscomprehension starts with who they blame. 

It’s true that some on Wall Street engaged in fraudulent conduct and financial misrepresentation to enhance their own obscene levels of compensation.

But ultimately, responsibility for our economic mess lies squarely with our own government’s policies of unsustainable debt, mass entitlement and high taxes. 

Our federal debt is almost $15 trillion -- $500 billion more than our nation’s gross domestic product.  Most economists agree that when a nation’s debt approaches 100% of its GDP, government spending is unsustainable and economic growth is severely stunted.  We passed the 100% level earlier this year without even slowing down, and that doesn’t begin to consider the eventual costs of Obama care and yet-to-come stimulus programs.

The political problem with stopping this free-for-all in its tracks is two fold.  First, government is growing and many politicians in Washington like it that way.  Second, entitlement programs are out of control.  More than 50% of Americans now receive a check from the government.  Too few politicians will go up against that reality.  By any arithmetic, if more than 50% of the voters are against you, you lose.

On top of a disastrous debt, we’ve ladled on a disastrous tax system that sucks 28% of our GDP into a black hole of government bureaucracy.

This heavy burden of huge debt, out-of-control entitlements and high taxes damages any chance our economy has to recover. 

Despite this trio of economy-killing government policies, both Occupy and their Labor sponsors want more government entitlements and the bigger spending and higher taxes needed to pay for them.

Ultimately, this isn’t an ideological question in the same sense that people may disagree about the relative benefits of federal vs. local education.  This is a question about the very survival of education ... or medicare ... or energy development ... or national defense ... or (insert your favorite government program here.)

Our debt will continue to cause our economy to deteriorate, more businesses will fail and jobs will be lost.  Fewer jobs means fewer taxpayers, less government revenue to pay for all those wonderful entitlements, and still more spending on things like unemployment benefits.  As revenues decline, and spending increases, we’ll accelerate toward the debt wall at which liquidity to fund our growing deficit stops. Interest rates will rise, inflation will kick in and the whole sorry spiral will start again.

Sound alarmist?  It’s not.  This is exactly the progression that is inevitable under the Labor - Occuply formula.

It’s the route to Greece.   And just like Greece, It will cause such pain that those Occupy forces who now demonstrate peacefully against capitalism will eventually riot violently against government austerity -- not in 5 years, but very possibly next year if something isn’t done now to stop the cycle.

We can’t keep spending at these levels and expect anything other than lower paying jobs and higher inflation -- virtually the definition of a declining standard of living.  And this at a time when our standard of living has fallen farther and more steeply over the past three years than at any time since the government started recording it five decades ago.

America is on a trajectory to assure our economic destruction.  The Occupy movement -- sponsored, funded and organized by Organized Labor -- is doing everything it can to make sure that trajectory doesn’t change.

But there is one big beneficiary of America’s economic collapse.  China who owns far more debt than it owes, will get most all the jobs America loses, and become the world’s new economic and military super-power.  That will indeed be a terrible thing to see.

And we’ll all have the oblivious coalition of Organized Labor and the Occupy Movement to thank for it.