Earth to Gramm: W.T.F.Were You Thinking??!??!

In the solitude of the high Alta Badia amidst the Malga's (working summer farms), the world's happiest cows gorge themselves upon verdant clover, wildflowers and grasses, clinking bells carried by the wind from seemingly all directions. From here, where the fossils in the Dolomite rock are Pleistocene, it is hard to imagine that the international monetary system is in severe and irreparable decline. The farmers cut and dry the grass for winter while the rest of the family including a now-short-and-stooped grandmother rake it on the steep slopes unreachable by conventional tractor. Marmots still squeal in the fog of morning, hawks hover high and time - excepting the encroachment of modern tourist construction built by the more enterprising of the Ladinisch - seemingly stands still.

Modernity intrudes nonetheless. Some of the enterprising have assumed large debts to construct - at a most dubious point in the cycle of both economic growth and changes wreaked by global warming - resorts that will inevitably be owned by the banks before the cycle is done. Restricted as comms were, a CNN-branchlet seemingly intended for Africa evidenced by ads for Nigerian banks and Ghanian port-services accompanied Berlusconi #1, 2 & 3 on the limited cable. It was the odious CNN that delivered to me the somewhat hilarious figure cut by Phil Gramm calling Americans a bunch of economic whiners, further suggesting that America's economic ills are both imagined by the Polity in general and a figment of the democrats' political strategists in particular. Now while it may be true that Americans are whiners - whether about taxes, gas prices, or one's liberalness, that is as far as Mr Gramm's worldview intersects with objective reality. Lore has it that everything is bigger in Texas - the cars, hats, steaks, the ego's, and if Mr Gramm and America's President are anything to go by, so to is the sheer ludicrousness of her politicians. $150bbl-oil has it would seem, has untethered any prior connection that such figures had with reality in the rest of the non-oil producing, home-owning, food-eating nation, a nation itself divorced from reality by the bubble of its own existence, as aptly summarized by Dr Roubini in his latest missive.

The problem with monumental political falsehood is that, like slander, it nonetheless tends to stick, remaining in the conscious mind long after it's been garroted by the facts. So let us contemplate for a moment the objectively sorry state of America's economy, and the likelihood of a yet-sorrier state in the imminent future. She [the USA] has seen steeply falling real wages for most workers for the last decade, impossibly large and persistent current-account and trade deficits on top of fiscal gaps that (all-in including SS) stretch the probable and exist only as a result of cynical piss-taking by foreign CBs mercantilist policies; persistently negative household savings rates that would make Edith Cresson's Grasshoppers blush; an energy-appetite woefully incongruous with the soaring energy prices, and future supply considerations, and energy-inefficient housing and transport infrastructure; an absurd healthcare infrastructure that consumes more per unit of GDP that any other nation YET leaves more than 20% of the population uninsured and uncovered, and fails to measure-up to peers spending half-as-much when it comes to basic measures of achievement such as infant mortality, and longevity; a financial system (including brokers, mono-line insurers, GSEs, and regional banks) that is in tatters due to excessive short-termism, greed, and flawed monetary policy; unprecedented income inequality that continues to widen through all-manner of rent-seeking and flawed political process, a currency that is in near free-fall through not-so-benign neglect, and an unwillingness to impose austerity upon a people whose lifestyles are at odds with their ability to afford what they've been told and sold is their god-given right; homes prices that are also in free-fall, municipal and state-finances that are in shambles, infrastructure (particularly transport, education and electricity) that is decaying rapidly, on top of unprecedented real and nominal levels of household indebtedness - especially credit-card debt, and international diplomatic initiatives strait-jacketed by the nation's debt held by our potential military foes and both real and imagined economic rivals. This is in addition to the Rappaport short-termism and economic cronyism encouraged by asymmetrical risk/reward of executive compensation that rivals the very best the Russian kleptocrats can muster, leaving the nation's enterprises as perilously fertile as the midwestern soils ravaged by intensive monoculture.

So, while it is all well-and-good for Mr Gramm to conjure political invective accusing the opposition of false manufacture, the fact is that none of these major-league problems are imagined, most were encouraged by, and accelerated their emergence since the turn of the millennium under republican watch without any acknowledgment to mission-control in Houston that we've even got a problem. Whiners? Maybe. But rest assured this has nothing to do with with the issues we face. Hopefully, this will be a year that the liars will be called-out, and perhaps that people recognize their own culpability in the travails that the nation now must confront.