Aug 16,2012

The only thing Obama’s stimulus plan did was scare people into believing the US has unpayable debts, American economist Todd Buchholz told RT. The president doesn't care enough about the country's deficit and debt, he said.

“Until the president leaves office, whether that is in January or in four years in January, it is going to be very difficult for the US to tackle these difficult economic and fiscal issues,” the former White House Director of Economic Policy said.

However, the economic situation in the US is gradually improving and there will be no “going back down into a double deep recession,” he said.

Young Americans looking for work should take initiative and find a job in a neighboring state, instead of waiting for a job to find them, Buchholz said, arguing that the younger US generation is no longer as mobile and motivated as it used to be in 1970s and 1980s.

The US has been educating its students over the last few decades to feel good about themselves instead of learning worthwhile skills, he said.

Buchholz also called the Eurozone crisis a “really bad polygamous marriage” that has become a complete disaster.

RT: In your latest book ‘Rush: Why You Need and Love the Rat Race’ you argue that in modern society there is a lack of desire to fight for anything, be it a good job or a good education. Is that pretty much so?

Todd Buchholz: We’ve had 20 years of focusing on self-esteem, trying to make kids feel better about them. It didn’t matter how they did on test scores, did not matter what they knew and what they achieved, the whole point was – it did not matter. The important thing was to feel good about yourself.

In Washington DC, for instance, they asked the students how they would assess themselves in mathematics. And the students felt that they had wonderful skills in mathematics, they had the best sense of themselves, they have great pride of their knowledge of mathematics, but when you look at their test scores it turned out they knew very little – if anything.

So, we’ve spent 20-40 years educating people that trying hard is not very important. What’s the most important is your feeling good about yourself. But that was just complete confusion, because the best way to get self-esteem is to do something worthy of esteem. And I’m afraid that the younger people are heavily disadvantaged in a pretty harsh economic climate.

Even before the ‘Great Recession’ which began in 2008 we were seeing, over the course of the last 20 years, a decline in the willingness of young people to simply move to another state in order to take a job. We’ve seen a decrease in mobility. Yes, the ‘Great Recession’ has made things worse, has made people even more nervous and worried about their futures, but those trends were placed beforehand.

RT: Do you think Americans really are becoming those people who need a three-hour lunch? You dubbed them as generation “born to sit”.

TB: Bruce Springsteen in 1970s had a famous rock song called ‘Born to run’. He wrote about a generation that couldn’t wait to get their driving licenses, couldn’t wait to get on the road to explore the country.

In a study done recently we see that young Americans are less interested in getting their driving licenses. In the 1970s and 1980s every high school student wanted to turn 16 or 17 to have a driving license. Now many of them are waiting till 18-20 – is that a cause of economic decline? No, but I think it is a symptom of a lack of motivation. So instead of being born to run they seem born to sit on the sofa in front of X-Boxes and PlayStations or their iPhones.

Of course there is a portion of the young population that is very, highly motivated, that is very ambitious and very aggressive and certainly is carving great careers for themselves. I’m certainly not going to suggest that the entire generation is sitting on the sofa. However, we have, especially in this harsh economic climate, certain states in the US which are prospering, where the job market is very healthy and other states where it is very poor.

You can rent a car, you can hop on a bus, it would only cost about $200, to get yourself on a bus from Nevada, a state with a terrible economic climate, to North Dakota, where you would have a job almost as soon as the bus arrives. And yet we’re not seeing people making those sorts of moves. They seem to be waiting in place for the jobs to come to them. And I’m afraid it is not a very promising way to look at the job market these days.

RT: So, the go-go days of the 1990sturned into the go backwards days of the 2000s, so where next?

TB: The US economy is above what a pilot would call “stall spin”. We certainly are growing fast enough, I believe, that we’re not going back down into a double dip recession. But the job market is painful. The job market is very weak. I think President Obama hasn’t done much to help the job market. I don’t think his stimulus plan was very effective.

The only thing the stimulus plan did was scaring people into believing that we now have debts that will be unpayable. And that the US debt to GDP ratio was simply beyond manageable.

We’ve the economy that is slowly repairing itself. What we seem to be avoiding are tough decisions when it comes to how we’re going to pay for our debts in the end.

http://rt.com/news/american-economy-obama-buchholz-856/