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May 01, 2008

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clarice

Didn't the NYT's crack economist/columnist tell us a short while ago that the French life was superior on the happiness scale?

In DC the Wash Po is desperately looking for hard times stories (not many because in my forty years' year this place has never been more economically prosporous). The lead story on the front page is of a middle class govt worker who has had to cut out buying organic meat from whole foods and now buys only organic milk for the baby, not the adults.

Ludicrous? You bet. People dumb enough to pay a premium for organic food to fatten the pockets of the Whole Food owners can eat trans fat cake for all I care.

Chris

It's a quagmire!

Sue

Wow. No more overseas vacations for some. Hang around and enjoy the local scenery. Things are really, really bad for some people.

Rick Ballard

EUland's demographic chickens aren't coming home to roost. Not today, not tomorrow and not in the foreseeable future. They have achieved the progressive dream of non-sustainable lack of growth.

"The Social Security/Medicare crisis in this country is as nothing by comparison."

We don't even have a "crisis". As long as our population continues to grow, adjustments can be made to retirement age and the idiotic COLA (which tacks a "bonus" on top of inflation) to bring income/expense into balance within short order. There is no such solution available for the Europeans. The shrinking population base can't increase at a rate sufficient to carry the burden over the next forty years.

Progressive immiseration is on sale here in the States right now - if you'd like some, vote RW or BHO. They'll deliver to your doorstep.

clarice

Krugman Aug 2005):
"First things first: given all the bad-mouthing the French receive, you may be surprised that I describe their society as "productive." Yet according to the Organization for Economic Cooperation and Development, productivity in France - G.D.P. per hour worked - is actually a bit higher than in the United States.

It's true that France's G.D.P. per person is well below that of the United States. But that's because French workers spend more time with their families.

O.K., I'm oversimplifying a bit. There are several reasons why the French put in fewer hours of work per capita than we do. One is that some of the French would like to work, but can't: France's unemployment rate, which tends to run about four percentage points higher than the U.S. rate, is a real problem. Another is that many French citizens retire early. But the main story is that full-time French workers work shorter weeks and take more vacations than full-time American workers.

The point is that to the extent that the French have less income than we do, it's mainly a matter of choice. And to see the consequences of that choice, let's ask how the situation of a typical middle-class family in France compares with that of its American counterpart.

The French family, without question, has lower disposable income. This translates into lower personal consumption: a smaller car, a smaller house, less eating out.

But there are compensations for this lower level of consumption. Because French schools are good across the country, the French family doesn't have to worry as much about getting its children into a good school district. Nor does the French family, with guaranteed access to excellent health care, have to worry about losing health insurance or being driven into bankruptcy by medical bills.

Perhaps even more important, however, the members of that French family are compensated for their lower income with much more time together. Fully employed French workers average about seven weeks of paid vacation a year. In America, that figure is less than four."

http://www.pkarchive.org/column/072905.html

Gmax

More time together( cant afford to go anywhere ) cooped up in the house with no baugettes to eat? I am sure Krugman thinks they should just eat cake, like his elitist predecessor!

sylvia

But how are things in Russia? From all the letters the Russians send into the London Times, they seem to be high rolling now with all the high oil prices. We are just transferring money from the West to the East now.

MikeS

More time together (cant afford to go anywhere) cooped up in the house with no baugettes to eat?

Sounds rough but on the bright side, if someone torches your car during the night the government tows it away for free!

Patrick R. Sullivan

Can Krugman smell the rot?

...my impression is that the subprime crisis — with its revelation that titans of finance were dealing in funny money and its tales of failed executives receiving hundred-million-dollar going-away presents — has resurrected the sense that something is rotten in the state of our economy. And this sense is adding to the general gloom.

The question is, can the next administration end America's malaise?

sylvia

I wonder if the cost of living going up is due to the changing nature of the economy of the West, which is less emphasis on manufacturing and more on the knowledge economy. Of course we have heard that the manufacturing economy is global now and people at the bottom are now competing for wages globally so their wages don't rise as much.

However, I think another factor not yet considered is the impact on real estate. People cannot live spread out in small towns centered around a small factory like they used to. Now the main business in the West is the knowledge economy, and the place for that kind of employment is in bigger cities. Increasingly the main place to get a job is only in the largest cities. Hence why DC is doing so well. So everyone needs to move to the city, sending the price of urban real estate skyrocketing as everyone competes for space, leading to more expenses for the middle class in housing and more need for gas as commuting increases.

We will probably go back to how it was in the old days here, when we were more agrarian. I often wondered why we see such great houses and apartments from the old days in the cities, and wondered who had the money to build those back then, considering how much more difficult it was to build pre-electricity. Then I heard that only the top upper class could afford to live in the city, say pre-1900. Outside the small ring of the city was considered barbarism apparently.

clarice

Sylvia, the cost of living is going up because compared to other major currencies, the dollar is down. Because it is down, to buy things that other countries want--i.e. oil. grain and gain fed meat(in short supply because of stupid ethanol provisions in the law)--we have to pay more in dollars than we used to to buy those things. In other things that are purely domestic--i.e., real estate, there is no inflation.You can buy much more for your dollar than you used to be able to.

clarice

**oil. grain and gRain fed meat*********

LindaK

When you have a stagnant economy, like France, where the majority of adults are employed by the government, rising commodities prices are a problem. Since the Euro is worth $1.55, perhaps they should get their bagettes mailed ordered from NY? Pourquoi pas?

PeterUK

"Didn't the NYT's crack economist/columnist tell us a short while ago that the French life was superior on the happiness scale?"

You can't eat happiness.

Food inflation is a world wide phenomenon,nothing the EU cannot make worse of course,but rising prices are becoming a problem.
Bread was always a good quality,plentiful staple in France,if the price escalates there will be riots.
One big problem in Europe is the rise of the public sector employment.A large number of whom are on magic money.Added to that are the fantasy figures paid to the financial sector.This has resulted in medium wage earners being priced out of Europe's capitals.Social housing is increasingly being allocated to immigrants with families.
The political elite seem unaware of this structural imbalance and keep partying like it was 1789.

BOATBUILDER

I'm no economist (I'm beginning to sound more and more like McCain, in spite of myself), but I'm guessing that the primary reason that the economy is so robust in greater D.C. is that the rest of us are sending so much money there. The one industry that never shrinks, never has layoffs and never cuts paychecks is the Federal Government.

Gmax

Boatbuilder

You nailed it. When I worked for a national CPA firm, we had a DC office. All the growth in their business, was related to government consulting contracts and work for various firms providing various goods and services to the government.

There was a thought in the DC office that the area was "recession proof" that the Federal government only gets bigger each year.

clarice

Boatbuilder--Exactly. And if either of the Dems is elected it'll be as though I were living on the Palatine Hill at the height of the Roman Empire. Ka-Ching! When I came here 40 years ago, we entertained in eachother's houses because there were no decent places to eat. Now every fancy chef is opening something here and you can go to any of hundreds of fine restaurantes any day of the week and find crowds.

PUK:"keep partying like it was 1789."
LINE OF THE DAY.


centralcal

O/T: Now Dean is doing Fox News Sunday with Chris Wallace!

Markos has lost all power poor baby!

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