Friday, March 13, 2009
Walk and Chew Gum, Part 2
There is a difference between the study of economics and our economy. Economics is the study of such things as supply and demand for goods and services. While our economy on the other hand involves what I like to refer to as the politico-economic interpretation of events, which after they take place, becomes our history.
The three sectors that President Obama has placed at the top of his “to do list” are energy independence, healthcare reform and education. Besides getting our domestic economy moving forward again, with the flow of credit to those points around the country, the Obama administration has taken a page from history, and quite correctly in my opinion, decided that these three sectors will be the foundation upon which the Obama administration will build our future.
Some people will disagree with his priorities and others will say this is not the responsibility of the central government. Those that disagree with those three priorities are entitled to their opinion, but if you have been in the United States since 1973, you know what an oil embargo is and what it can do to our economy. As for the second argument that this is not the responsibility of the central government, I would answer that national security is the responsibility of the central government and importing 70% of the oil we need weakens our national security. From a purely economic perspective, importing $700 billion worth of foreign oil is not good for an economy to run such trade imbalance. Exporting cash for oil when there are other forms of energy within the borders of our country is quite simply poor economic policy. We need to control a greater percentage of our energy needs from a national security standpoint if nothing else.
Healthcare is perhaps the toughest of the three sectors to argue because there are millions of opinions about how healthcare should be done. Everything from do not touch a thing to universal healthcare for all. The interesting thing since the attempt to reform healthcare during the Clinton administration is that the business sector has come to realize that if other countries take on the burden of healthcare costs from the giant corporations, that our corporations are at an economic disadvantage to compete on price of goods sold in the USA. If foreign corporations had to add the cost of healthcare back into the price of their products, American made products would find themselves on a more level playing field. American industry has now come to realize that healthcare costs have put them at a price disadvantage against Europe and Asia. As a result of this change, healthcare reform in the United States is an economic necessity.
And finally the education sector is the future of this nation. The United States does not have a national education policy, and yet test scores of American children are constantly compared to test scores of children from around the world where nations have a national education policy. If we have any hope of remaining an important country in the 21st century, we must develop better education policies to meet the challenges ahead.
We must be able to meet a series of challenges at the same time, much like anything else in life we must be able to walk and chew gum.