Wikinvest Wire

Jim Kunstler welcomes Barack Obama

Monday, January 19, 2009

As might be expected Jim Kuntsler has a few ideas to share with President-elect Barack Obama. In his inimitable style, he offers the following thoughts:

Tomorrow at noon, Barack Obama steps into the shoes of Lincoln, FDR, Millard Fillmore and forty other predecessors -- this time as the wished-for Mr. Fix-it of a nation run into a ditch. Surely over the months of transition, someone with a clear head and a fact-laden portfolio has clued-in the new President about the reality-based state-of-the-Union -- as opposed, say, to the Las Vegas version, where Santa Clause presides over a whoredom of something-for-nothing economics, and all behaviors are equally okay, and consequence has been sliced-and-diced out of the game. . . where, in the immortal words of Milan Kundera, anything goes and nothing matters.

Mr. Obama deserves credit for a lot of things, but perhaps most amazingly his ability to see "hope" in a public so demoralized by their own bad choices that the USA scene has devolved to a non-stop Special Olympics of everyday life, where absolutely everybody is debilitated, deluded, challenged, or needs a leg up, or an extra buck, or a pallet on the floor, or a gastric bypass, or a week in detox, or a head-start, or a fourth strike, or a $150-billion bailout.
And that's just the warm-up.

He goes on to predict the imminent demise of life as we've come to know it since Ronald Reagan launched his credit and debt revolution back in the early-1980s.

While he is surely correct that the yard-sale business will surge in the period ahead, he probably underestimates the inertia that has built up over almost three decades in Washington, on Madison Avenue, and on both Wall Street and Main Street, all of which will help perpetuate the status quo.
Say goodbye to the "consumer society." We're done with that. No more fast money and no more credit. The next stop is "yard-sale nation," in which all the plastic crapola accumulated over the past fifty years is sorted out for residual value and, if still working, sold for a fraction of its original sticker price. This includes everything from Humvees to Hello Kitty charm bracelets.
I don't see how America can confront the "change" represented by the stark fact that suburbia-is-toast. It is the sorest spot of all in the corpus of a culture beset by disease and debility. The salient manifestation of suburbia's demise is the remorseless drop of housing values in the places most representative of that development pattern. The worst thing the Obama team could do about this would be to attempt to prevent the fall of inflated house prices. Their real value needs to be clearly established before a picture emerges of which places have a plausible future, and which places are destined to be mere ruins or salvage yards.
There's been plenty of buzz in the blogosphere about the imminent failure of the US "social safety net," including especially the social security program. Retirees are the biggest block of voters. They're not liable to foment riots -- that is best left to the youthful high-testosterone cohort -- but the older folks -- with Baby Boomers now coming aboard -- could be so distressed by the loss of their presumed entitlements that they will elect any maniac promising to bring back something that looked like the 1980s. We haven't begun to hear their war cries, and I hope they do not beat a path straight into some sort of crypto corporate fascism -- as, finally, every last failing scrap of American life is nationalized.
It's way too early to start talking seriously about the Carter-Reagan parallels between 1976 and 2008, but they are quite interesting to ponder.

In the end, Mr. Obama is wished good luck. He will need it.


donna said...

Binge and purge, it's the American way...

Anonymous said...

Kunstler is way off here.

Price drops are a 2-way street. Unless prices drop even more in the urban center I don't see how people would be able to afford to move there.

The days of the 3500 sq ft house are over, the days of the 60 mile commute are over, but the 1800 sq ft house and the 45-mile commute will take its place. That is still suburbia. Unless taxation somehow drastically reverses and the cost of living becomes higher in the suburbs than the urban center, nothing will dramatically change.

Anonymous said...

Although I don't disagree with Kunstler's statement that worst the Obamas can do is prop-up house prices, just as important is to end the subsidies of car use - in particular road building. The cost of driving must begin being accurately reflected.

Instead of bailing out banks, our money would be better spent on building rail-based public transportation (as is done today all over Europe and Asia). That way many will be able to live in places away from the major urban centers (the very existance of small towns all over New England is very much thanks to rail).

(which isn't to say that many exburbs will crumble and die).

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