Happy Birthday, America.
You are now 231 years old and should be ready to die.
Skyrocketing oil prices, rising interest rates, creeping inflation, terrorism, war, outsourcing, China, health care woes, defaulted pensions, Wal-Mart, global warming, corporate corruption, the housing bubble, Social Security, the widening gulf between rich and poor – all of these things should eventually kill you.
Or maybe they won’t, says Vectra Bank Colorado economist Jeff Thredgold.
Thredgold, 56, who is frequently quoted as a beacon of light in this sometimes dark column, has just released a new book, “EconAmerica: Why the American Economy Is Alive and Well … And What That Means to Your Wallet.”
Nothing, argues Thredgold, is so grim.
“When you walk into Barnes & Noble, there are 40 books about the economy. Five are textbooks, and the other 35 are all negative,” he said. “It’s the coming oil crisis, the coming dollar crisis, the coming debt crisis, the rise of China, the decline of America, and I just don’t think that way.”
I interrupt: “Yeah, but …”
“No ‘yeah, buts,”‘ said Thredgold. “You read the national press, and your job is to point out the potential land mines. That’s my job too … but I try to take a more optimistic look at them.”
So here’s the good news, according to Thredgold:
Forget about losing jobs to offshore labor forces, downsizings, technology and the illegal-immigrant invasion. The American labor market faces a shortage. Companies that hope to prosper will have to pay more for labor, and that means beefing up benefit and retirement programs too, Thredgold said.
You know those folks in Washington who complain about “the liberals” or “the right-wingers” in their obstructionist approaches to problems? Well, the only reason they can get away with this is because times are relatively good. Eventually, the market will supercede this nonsensical rancor, driving needed changes in entitlement and benefit programs.
Long-term interest rates are not going to the moon. The Fed has inflation under control, and the bond market has the Fed under control. Homebuyers and anyone else who seeks funding will prosper.
Baby boomers will not send the stock market into a death spiral as they retire en masse over the next couple of decades. Instead, they will soon begin saving more aggressively, sending the market even higher than the record levels we see today. They now understand that neither the government nor their employers are responsible for their retirement.
Thredgold, who bills himself as an “economic futurist,” collects jokes because he logs 100,000 miles a year on the speakers’ circuit. (Check out.)
“There are three kinds of economists – those who can count, and those who can’t,” Thredgold wrote in his 2001 self-published economist joke book. “Why did God create economists? To make astrologers look good.
“How many economists does it take to screw in a light bulb? Eight. One to screw it in and seven to hold everything else constant.”
What I like about Thred gold is that he doesn’t take himself too seriously. He can’t because his wife, Lynnette, is both a concert violinist and a competitive bodybuilder. She could easily pluck his strings or bench- press him if he ever got out of line.
“Economists give forecasts of the future not because we know what is going to happen,” writes Thredgold. “We give forecasts because we are asked to.”
Looking back, Thredgold’s thesis is dead on. Things really haven’t turned out as badly as many economists and members of the national media had predicted.
Over the past 25 years, despite all kinds of shocks to the system, the U.S. economy has technically suffered only two modest recessions: one from 1990 to 1991 and another from 2000 to 2001. The rest of the time, our collective economic life has been relatively good.
“Most of the national media would never admit that we had it good,” said the ever-so-optimistic Thredgold.
“Yeah, well that’s the thing,” I responded. “I keep thinking things have been good for so long, it’s only a matter of time before they turn bad.”
Al Lewis’ column appears Sundays, Tuesdays and Fridays. Respond to Lewis at , 303-954-1967 or alewis@denverpost.com.
