FinancialEdge: 10 Reasons To Fear The U.S. Economy

Halloween is a time for the sort of fear we all enjoy - cheesy horror movies, clever costumes and a general appreciation for the macabre and creepy. Far less enjoyable, though, is thinking about some of the reasons investors may have for fearing the U.S. economy. Unlike ghosts and goblins, some of these fears may prove to be very real and offer more than just a friendly little tingle up the spine.


1. Crumbling Infrastructure
While the U.S. government has handed out plenty of money over the past three years, relatively little of it has made its way towards bridges, roads, schools and hospitals. That is unfortunate, as the U.S. went through a building boom in the 1950s and 1960s and is now badly in need of repair and expansion. Infrastructure underpins economic growth. Without better public facilities, there will be a long-term drag on economic productivity.  

2. High Debt
Of all the problems in the United States, large budget deficits and a growing debt burden are probably the best-known. Public debt is at about $13.6 trillion in the United States, or roughly 94% of annual GDP. That puts the country in uncomfortable company with the likes of Japan, Italy, Greece and Portugal.

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Personal Rant - A Memo to BP Complainers, "Pick Your Poison"

It seems to me that bashing BP is now a cause celebre amongst the chattering class. The way some of these people are talking, you would think that BP laid explosives around the drilling rig and deliberately blew it up just to dump oil in the Gulf and ruin the lives of all these people.

Enough already.

Yes, BP screwed up. Yes, BP management has been irritatingly clumsy in their PR response. Do you think they wanted to dump thousands of barrels of valuable oil into the Gulf? Do you think it is easy to fix a blow-out deep below the sea? Do you think there is a manual for this?

I wonder how much of this reaction is a byproduct of what I have long called the "me wantee" culture in America. We want everything to go our way; we want our cake, we want to eat it, and we want it to have 100% of our daily vitamins without any calories.

People need to wake the hell up and realize that modern life has its costs. You want to stop drilling offshore? Really? Where do you want to get your oil from? The tar sands of Canada? Off the coast of Angola? From Russia?

Producing oil is a dirty business and occasionally things go wrong. That's just a fact of life. Is the oil from tar sands or Angola better because it degrades the environment in Canada and Angola instead of ours? Is it "better" because we don't have to live with the risk or see the costs?

Or what about hybrid and electric cars? Are these kosher because Americans don't have to see the environmental degradation and human exploitation that goes with digging up the rare elements that make up the batteries and components? Are toxic mine tailings not a problem as long as they don't hurt "our people"?

There are no free rides here. If you want to live in a modern economy, you have to make unpleasant choices. If you want electricity, it has to come from somewhere. It isn't practical to provide America's energy needs from solar, wind, geothermal, hydroelectric or other "fluffy bunny-safe" technologies. So choose from coal, gas, oil, and/or nuclear - every one of them has problems. Pick one.

If you want a modern economy, you need fuel for transportation, certain metals for technology, and materials like plastics. Those come from mining, drilling, and refining. Want to replace all of that with corn? Fine … then you pick who gets to starve when we reallocate grain production to fuel/plastics instead of food. So take your pick - spills, mine disasters, refinery pollution, etc. or starvation.

Or maybe we should all just live like the Amish. Anybody want to buy a buggy?

I sometimes feel like the modern manifesto goes something like this. " I want an SUV, $1/gal gasoline, and no environmental worries. Oh, and I want a diamond ring ... but the diamond has to be harvested by fluffy bunnies and the gold has to come from renewable unicorn droppings."

I am not trivializing the huge costs and impact of this oil rig disaster in the Gulf. It's serious, a lot of people are getting hurt, and the clean-up is going to be long, painful, and expensive. I'm not mocking those who are, or will be, suffering as a result of this. I am not mocking people who are legitimately concerned about the environment and working to find solutions.  But people need to rein in the hyperbole and realize that adult life in the modern world requires some tough decisions and the realization that nothing comes for free.