Elections, Real Estate, Jobs, and Sucking Sounds



What can American’s expect their next president to do about the sagging real estate industry? Most experts on the subject would say, nothing. Nether President Obama, nor hopeful Governor Mitt Romney seems to care much about foreclosures or even a resurgence of the market. Many are asking; “When will the real issues surface?”

No jobs in sight

Not enough jobs in sight

An article in the San Jose Mercury directs our attention to the fact neither candidate for President of the United States either offers a solution, or even is overly concerned with the state of housing in America. Holden Lewis, of Bankrate.com, takes aim at one key economic piece of an American recovery puzzle no politician seems to grasp. As the author points out, Romney’s solution to problems seems to be to point at Obama’s delinquencies. And as for Obama, home prices and underwater mortgages plagued his first administration. What’s worse, the President has offered no concrete solution to the busted real estate bubble, let along remedies for the fall’s underlying causes.

When all is said and done, about the only help the Obama administration has created has been one form or another of “forbearance” – a sort of stalling set of mechanism which end up in still more agencies and red tape, than actually solving for bankruptcy and rising mortgage waters. This New York Times report lists a series of Obama initiatives, it reads like a play by play on a drowning. The article also quotes Romney as having said “the market needs to bottom out before homeowners would see relief.” Just what that means is open to speculation.

At the core of the housing issue, underwater mortgages and the overall productiveness of the US economy weigh down any possibility housing will swim any time soon. Family and individual income, confidence that the aforesaid will have sustainable income streams, a whole series of factors tied to A – Jobs, and B – overvalued properties, these problems remain under stressed by either candidate really. What bank do you know that would loan you money on a junk car? Factor in that the company you work for may move to China. The astute reader just caught that fly ball.

Meanwhile, Obama has passed into law legistlation with longer names than those unemployment lines many of you have stood in. The so called “Re-empowerment of Skilled and Professional Employees and Construction Tradesworkers” or RESPECT, along with other liberal labor moves, has further constricted businesses in America, at a time when jobs are essential. Being bipartisan here, is a bit more crucial than at other times. Obama has made it tougher for companies to employ and pay people, period.

As for Romney, even his craftily drafted platform dogma on his website errs toward bashing Obama first, and logic and truth second. This one statement reflects what generations of right wing money men have sought. It is, in effect, propaganda:

“Right-to-Work states have added millions of jobs over the past decade while states with pro-union policies have shed nearly a million jobs. In a recent Gallup poll, a majority of Americans said that labor unions “mostly hurt” the American economy.”

For those unaware, so called “Right-to-Work” states are basically those places where your neighbors are out of a job in manufacturing because the greedy companies they worked for once moved to China and the emerging economies of the world. That’s right, I used to work in manufacturing, my best friend just got canned after he himself was directed to “close” dozens of textile plants. North Carolina and the Piedmont area of the South were fairly decimated by the shift overseas. They are not alone.

The real solutions to ALL of these problems are available. Certainly, the decisions are not so simple or easy. But what is America worth? A set of trade tariffs that ensure North Carolinians can weave garments as competitively as Malaysians? Imagine a retail and wholesale market where price is not the issue, where quality is. Now there’s an announcement from Obama I would like to hear.

Those states Romney mentions adding jobs, were those union intensive industrial jobs? McDonald’s jobs? Car wash jobs? Oh, they must have been Internet jobs, I know former Presidents touted globalizationon the grounds American’s are so sharp they deserve Internet jobs (tech). George W. Bush took great pride for his part in fostering the so called “free trade” agreements. Speaking on the issue of tarrifs, he said:

“I’ll work to end tariffs and break down barriers everywhere, entirely, so the whole world trades in freedom. The fearful build walls. The confident demolish them. I am confident in American workers and farmers and producers. And I am confident that America’s best is the best in the world.”

Since 2000 when Bush took office, America has a net loss of jobs of some 10.5 million according to many estimates. Some 14 million Americans who might be employed building new homes, or in manufacturing products, are too hopeless now to even look for work. Interestingly, at least Obama has made a shadow effort to create a reemergence of manufacturing. This report (PDF) details faulty data offered up in contention of any shift to regain production capacities in the US. Obviously, American’s have never benefited so far. Also interestingly, another report (PDF) clearly shows that “offshoring” manufacturing does not actually benefit consumers substantially, even price wise.

Questioning the “why” of the push to globalize seems intelligent at this juncture. Make no mistake, we are literally interwoven economically at this juncture. The US recession, tied inextricably to EU over exposure, and a whirlpool of capital leaving nearly every Western economy for Asia – that “sucking sound” Presidential candidate and Billionaire Ross Perot spoke of… It is still being heard. American’s, many at least, thought Perot was crazy. He lost the election, but the winner, Bill Clinton, supported NAFTA. The first in a series of free trade moves went into effect back in January of 1994. We never recovered.

I leave the reader with video of Mr. Perot where he describes that “sucking sound” in no uncertain terms during the 1992 presidential debates. You will note too, his last comment on the question refers to NAFTA and other such unequal trade agreements “wrecking the country” – days before we elect a new president, this seems important to discuss. Jobs, earnings, that is what the real estate slump is mainly about, and then some investors running off with trillions in “sold” value, but that’s another topic.

Comments

  1. Yes Phil,
    The video of Ross Perot stating exactly what has happened now that we are 20 years down the road, brings back a lot of memories. I voted for Perot in 1992 and was very disappointed when Clinton won and NAFTA was enacted. Both Bush 41 and Clinton were on the same path however. They both wanted NAFTA and Bush 43/44 continued that push as well. I had a high paying tech job with IBM in the 1990’s that was eventually shipped overseas as well. I don’t think that democrats care about the impact of union wage and benefit guarantees, and the republican party realizes that if you can’t control unions you can just move overseas. Technology has made this much easier to do than it was in 1992. But Perot was a prophet in the video…he mentioned that once wages go up in China and come down here, so that they are level, we’ll see jobs come back to the US. That is exactly what is happening. I just paid a graphic designer in the USA $5 to do a book cover, that used to cost me $50 to have done….those jobs should be coming back any day now…good article Phil – thanks for bringing this back.

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