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"American Gridlock" by Mr. Woody Brock


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[amazonsearch]American Gridlock[/amazonsearch]


Most of you probably have already read the book, so I won’t describe it in detail here. For those who haven’t, I just say that it is divided into 6 chapters:

1) Dialogue of the Deaf: a sort of “deep” introduction to Inductive Logic,

2) How to extricate ourselves from a Lost Decade,

3) How to resolve the longer-run entitlements spending crisis,

4) How to prevent future Perfect Storms in the financial markets,

5) How to negotiate more effectively with thugocracies (China),

6) How to confront the thorny issue of distributive justice in seeking to create a more ideal polity.

I think it is a good book, that offers sensible solutions to all the aforementioned dilemmas. Anyway, there is a question that, imho, is left completely unanswered: in Chapter 4, Mr. Woody Brock shows that, in order to prevent future perfect storms in the financial markets, the most important variable, which can be controlled, is to keep the system from piling up excessive debt. And he shows how this could be accomplished. Ok, that’s fine! But, what about today?! See page 2 of the presentation in attachment: today Total Debt Outstanding as % GDP is 350% in the US and 450% in the EZ. The question that’s left unanswered is: how do we go back to a more sustainable 200% Total Debt / GDP? With GDP growing 1,5% - 2% in the coming years, growth does not seem to be the answer. So, how do we cut Total Debt almost by half? Unfortunately, Mr. Woody Brock offers no answer.


This morning I have read an article by Mr. James Miller of the Ludwig von Mises Institute of Canada, and he reminded me of Mr. Mellon’s advice to President Hoover: “liquidate labor, liquidate stocks, liquidate farmers, liquidate real estate” instead of propping each industry up with tax dollar. This liquidation doctrine would “purge the rottenness out of the system” and make certain that “people will work harder” and “ live a more moral life.”




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