Sunday, March 06, 2005

Larry Kudlow Blog Discussion

There is no doubt that Larry Kudlow is an eternal optimist. In the current economic environment, he has every reason to be. The interesting thing is that his detractors seem to be blinded with contempt. They choose to ignore the economic boom and they truly believe the sky is falling. The following is a copy of a reply I posted to one of them on Larry's blog.

Jack Miller said...

To Howard: What if?

What if you were poor, hungry and unemployed? Would you not take a job for the going wage? The standard of living in China has risen dramatically since China joined the WTO. The deal has been outstanding for China and America. Just as good as the deal made between the orange grower and the wheat grower; both parties won.

Make a show, tip all you want and tell the world about your largesse. The lucky employees on the cruise ship will appreciate it. But, also, have a little compassion for the truly needy of the world. Please don't whine because a poor man has landed a job that allows him to feed, cloth and shelter his family. I have seen the shanty towns in the Far East. Believe me; those who are not our "wage slaves" would like to be.

What if the downward inflationary trend, which started in 1982, continues? Will we soon average the inflation rates of the 1950's? From 1952 to 1958 the GDP deflator averaged less than 2%, economic growth averaged 2.9% and unemployment averaged 4.7%. There were brief or mild recessions in '54 and '58. I don't have the productivity numbers but I am confident that today's incredible numbers are much better. Maybe current bond rates are high! Maybe rates are exactly where they should be.

There are powerful disinflation forces involved. A recent survey of workers shows 55% are happy with their job. Seventy-six percent of workers who are full-time telecommuters are happy. In addition to the benefit of happiness, these workers consume much lower amounts of fuel and other resources. They work an average of 2.4 hours more per week. Billions of people are better off today than they were a year ago. You are probably one of them. Don't worry; be happy!