A No-Cost Job Program for Obama

In a couple of recent blogs [Does Complexity Breed Volatility? and Perry, Obama, and Political Volatility], I postulated that citizens (and investors) tend to get overwhelmed by news of which they can no longer clearly evaluate the impacts, because the World around them has become too complex.  They tend to  give up on the complexity of the world surrounding them, and follow the herd. Everyone seems to follow and agree with a simple idea, moving together to one side of the boat, until some news or idea causes people to all move to the other side, creating political or market volatility.  Citizens – many of them one-issue voters – no longer analyze the issues, evaluate the pros and cons, bounce it against their own value system and their experience, they go with the flow…   Back at the ranch, market and political volatility create fear and uncertainty in the minds of the business community.  In my business dealing mainly with the Federal Government, things look pretty uncertain right now.

My recommendation for President Obama’s job program costs nothing, creates jobs right away, is sustainable, efficient and effective, and does not involve Government fraud, waste and abuse.   All the President has to do is to remind investors, company executives and entrepreneurs in his speech  why better economic days are most certainly ahead of us, and why investing in our future now makes the most sense:

• The U.S. population is projected to grow to 400 million by 2050,
• The rest of the World is growing fast and incomes are rising in many emerging economies,
• We are getting older and staying productive and healthy longer,
• etc, etc, etc…

Calming our economic nerves, and reminding us that brighter days lay ahead  can do this Nation a lot of good…and create jobs, rather than telling us to “go shopping” as George Bush did after 9/11.  Our World is complex, and our brains,  subjected to constant bad news and fear, could use a calming influence to show us the light and help us get back to work.

Perry, Obama, and Political Volatility

In my last post [Does Complexity Breed Volatility?], I briefly talked about how complexity makes it increasingly difficult for investors to evaluate the impacts of incoming news, especially “big” news, on their investments.  The result is that everyone sells with everyone else, or buys when everyone else buys, resulting in increased market volatility.

The same concept can be applied to politics, call it “political volatility”:  Faced with an increasingly complex political, economic and social environment – a system where the impact of everything is connected to everything else – citizens are having an increasingly difficult time evaluating what politicians mean, and what the true impact of a politician’s proposed initiative really will be.  For instance,  Perry believes, [What Does Rick Perry Believe? by Jonathan Chait] for example, that the national Social Security system, should be scrapped and that each state should be allowed to create, or not create, its own pension system. Is that a good idea?   To answer that question, each citizen theoretically ought to answer the question: Would I be better off, or would my community be better off?, or would my children be better off?   Perry says that Social Security is not sustainable,  and the U.S. Congressional Budget Office agrees, but Social Security could be reformed, and its viability depends greatly on the future economy – many ifs and many linkages to other systems and other parts of our lives!   OK, but many ifs and potential complexity in Perry’s ideas.

President Obama is facing a sea of Republicans driven to get him out of office no matter what the cost apparently.  The strategy, it seems, is to create political volatility, and move the electorate by simplifying the issues and create mass appeal.  Just as with the market, the electorate will move to one side of the boat, until someone screams for them to move to the other side.  In the meantime,  political volatility has created anxiety and fear, and has likely contributed to the economic sluggishness.

President Obama  has few weapons.  One is calm and reserve.  His tepid response is likely to be the best medicine to counter the current volatile climate, and hopefully let rational thinking  bring us to the center of the boat, if only for a little while…

See also my blog from last year:  Complexity: Is the Presidency Doomed?