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Barack Obama: Guidance Counsellor in Chief

This morning, Yahoo news is running the headline, "Obama says financial sector to shrink":

The financial sector will make up a smaller part of the U.S. economy in the future as new regulations clamp down on "massive risk-taking," President Barack Obama said in an interview published on Saturday.

Obama, whose young administration has spearheaded a raft of reforms in the banking sector as part of efforts to tackle the financial crisis, said the industry's role in the United States would look different at the end of the current recession.

"What I think will change, what I think was an aberration, was a situation where corporate profits in the financial sector were such a heavy part of our overall profitability over the last decade," he said told the New York Times Magazine.

"Part of that has to do with the effects of regulation that will inhibit some of the massive leveraging and the massive risk-taking that had become so common."

Obama said some of the job-seekers who may normally have gone to the financial sector would shift to other areas of the economy, such as engineering.

"Wall Street will remain a big, important part of our economy, just as it was in the '70s and the '80s. It just won't be half of our economy," he said.

"We don't want every single college grad with mathematical aptitude to become a derivatives trader."

Honestly, I really don't know what to say here ... my jaw is still hanging open, especially after that last sentence.

If you haven't read the piece at finemrespice.com that HughS linked in his earlier post, then I would encourage you to read it now, because it contains a sobering discussion of the fascism that is being imposed on our nation by its current Executive branch.

The word "fascism" is chosen deliberately, but not as an allusion to the concentration camps and ranks of goose-stepping brownshirt thugs feared by hysterical liberals during the last eight years. Instead, I am talking about political fascism -- the creation of a state that allows private ownership of industry and property, but in return demands complete obedience, and ultimately bestows upon itself the power to overtake and subdue any individual or business entity of which it does not approve.

A few weeks ago, President Obama opined, "We're not producing enough primary care physicians," as if they can be rolled out of an assembly line like iPods or cans of peas. Doctors aren't "produced," and neither are derivatives traders. Each is a specialty field, and those who practice within those fields make a lot of sacrifices in order to earn that privilege -- intense competition, long grueling hours at work, abandonment of personal well-being in order to serve the company or treat patients, and a continual fear of the dire consequences that result from even the smallest mistakes -- those are just a few of them.

But now it seems that President Obama thinks he has the wisdom to be able to dictate the career choices and economic incentives available to Americans. Less "bad" careers and more "good careers, less "bad" profits and more "good" profits; that's what he seems to be saying.

When the government begins dictating careers and restructuring our economy, they will likewise be compelled to begin limiting the personal freedoms that could potentially interfere with those state-imposed choices. When that happens, we will all have the opportunity to see what fascism really looks like.


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Comments (22)

Here's an example of the 'c... (Below threshold)

Here's an example of the 'caring' bureaucrats who will soon be overseeing your health care.


That last paragraph.<... (Below threshold)

That last paragraph.

This S.O.B.ama has a lot of fn nerve. As if I give a flying f what the hell He wants or doesnt want. the stupid SOAB.

Take a deep breath, oh ye w... (Below threshold)

Take a deep breath, oh ye wingnut titans of finance. You'll still be allowed to chase fat Wall Street bonuses--it's just that (thankfully) there won't be as many of them to go around, which is an obvious corollary of the implosion of the financial products market. He's not saying "Don't study finance," though he is making the obvious observation that the financial careerpath will likely be less lucrative than in recent years. And that's fine because it's true.

As for Obama's suggestion that people contribute actual value to the country through (e.g.) a career in engineering, well, that's certainly an odd thing to complain about. Again, note that nowhere did Obama say you aren't free to do whatever you want. The people he's speaking to--young high school students--like him and look to him for guidance, so he's explaining that there are other fruitful careers available for mathematically adept hard workers. The net result of this: the United States might suffer an abundance of doctors, scientists, and mathematicians.

Would you care if a conservative president made the same suggestion following an implosion of the financial markets? He's trying to keep smart kids in the United States! Would you prefer they go practice finance in Germany?!

Yes... (Below threshold)


The financial sector will m... (Below threshold)

The financial sector will make up a smaller part of the U.S. economy in the future as new State borrowing and taxing takes more money out of the private sector and puts it into the public sector. New regulations allowing more State control over businesses (e.g. seizing control of bankruptcy procedures) will scare away more investors. The result will be larger barriers to capital formation, resulting in a steadily shrinking economy. This, in turn, will create more opportunities for capital to move overseas, seeking better business opportunities.

President Obama is correct to say that many of these jobs are gone forever. He would know: his administration is working hard to bury the financial services business.

President Obama is wrong that the supply of talent will move to engineering. Engineering what? Due to the high cost of labor (especially unions and labor law) and the high costs of doing business in the US (especially the high corporate taxes and the huge volume of regulation), it is very expensive and risky doing business in the US, but it is especially difficult to be in the manufacturing business compared with much lower costs overseas. We've been watching manufacturing jobs moving off shore for years, but now many other more skilled work is also being moved overseas. We have reached a point in this country where more people are employed in government than in manufacturing, and Obama is poised to make that situation much worse.

The only engineering jobs that I see doing well are in civil engineering (i.e. government). Most of the parents that I know have guided their kids away from engineering because there just aren't good opportunities. Engineering schools have lots of students. But go to a graduation ceremony for an engineering school and read the names of the kids who are graduating: they are almost all foreign names, and the instructors will tell you that, yes, they are foreign students, and they are going back home - where the opportunities are.

Manufacturing is where real wealth is created, and it is where this country's position is shrinking. That's why we need foreign creditors like the Chinese to pay our bills. But now all of the bad habits that this country has acquired in the past generation or so are being dramatically accelerated. That's why the Chinese are canceling our credit card and buying gold.

You wanted change? You've got it.

Please remove your eyeglasses and shoes, tighten your seat belt, assume the crash position, and brace for impact. The economy that you are constructing is not sustainable, and the dollar bubble is about to burst.

I would rather they study t... (Below threshold)

I would rather they study then kill baby seals. ww

Geez Maybe I am behind the ... (Below threshold)
geo Author Profile Page:

Geez Maybe I am behind the current times but I thought it was every Americans right to be whatever they wanted to be..including derivative traders.

You should also read the IM... (Below threshold)

You should also read the IMF "World Economic Outlook". The IMF is generally a big fan of Washington insider policies, and their report assumes the US policy changes will help (not hurt) and that borrowing will stabilize [!?]. Those assumptions are hugely favorable to DNC policies. Even with those assumptions, they write:

The U.S. net external position will also continue to deteriorate, as U.S. external borrowing needs remain substantial. ... The financing of current account deficits, particularly in the United States, may still be problematic in the coming years. If the attractiveness of U.S. assets were to decline, for example, because foreigners became concerned that higher government financing needs would push up U.S. long-term bond yields, foreign investors might reduce their U.S. exposure, leading to an abrupt depreciation of the dollar.

Foreigners are already concerned.

<a href="http://www.google.... (Below threshold)

China joins the "Tea Party"
"... up until last month they were the number one provider of currency to the United States and now they're gone."

Hyperbolist,You appr... (Below threshold)

You appreciate Obama's suggestion that young people contribute "actual value" to the country in their career choices. So, Michael cites Obama's statement that we are not producing enough primary care physicians. Why do you think not enough young people are electing this vocation in the health care field in of their own efforts and interests? They are not aware there is such a profession (so the President will tell them there is); doesn't pay enough; too much government bureaucracy involved?

Freedom of choice when it c... (Below threshold)

Freedom of choice when it comes to vocations?

What an OBSOLETE concept!

Oddly enough - you get less of what you tax heavily. You get more of what's profitable. Make medicine and engineering as profitable as derivitive trading, and you'll have more engineers and doctors than you'll know what to do with.

But the left has pretty much laughed at the idea of patriotism, of duty to country for so long, there's not much of a cultural incentive to get into medicine 'for the good of the country'.

I would rather they stud... (Below threshold)

I would rather they study then kill baby seals. ww

What? You would rather that they study, and then kill baby seals? Willie, I don't think you need to study mathematics in university to kill seals with a club. And anyway there aren't any fur seals in the United States so that's a stupid suggestion at face value, unless you're suggesting that they poach seals from Denmark and Canada.

DaveD: I think that if a bright, ambitious person has the option of being an investment banker and earning $500,000/year right out of college, that he/she will do this rather than become a physician earning perhaps one-third as much. Now, however, those ultra-lucrative entry-level jobs are no more, and so the cream of the crop might do something useful with their lives, e.g. study medicine, as opposed to becoming derivatives traders. And, one way to encourage this is to offer free tuition to those who would become GPs/radiologists/oncologists/etc. (Basically, free tuition for people who wish to practice non-cosmetic medicine.)

Yes, it's social engineering, but a society that offers insufficient incentive for people to study medicine but has an over-abundance of greaseball Wall Street investment bankers is a society that could use some serious f*cking engineering. What's the alternative? Double the patient load for physicians? Let nurses write prescriptions? No more health care for poor people?

The only engin... (Below threshold)
The only engineering jobs that I see doing well are in civil engineering (i.e. government). Most of the parents that I know have guided their kids away from engineering because there just aren't good opportunities. Engineering schools have lots of students. But go to a graduation ceremony for an engineering school and read the names of the kids who are graduating: they are almost all foreign names, and the instructors will tell you that, yes, they are foreign students, and they are going back home - where the opportunities are.
Kevino - I think you've hit at least one nail on the head here. Civil engineers ARE needed in our country - but there's little to no glamor in a road or sewer system, and big projects (like Hoover Dam) aren't common any more.

Aerospace? Likewise. A high-tech fighter will take a minimum of five to ten years to go from first proposal to cutting the first metal for a prototype. Where's the excitement for a new engineer? Certainly not with NASA any more - but some of the upstarts getting into the space biz might be hiring. (If someone were to try rebuilding the DC-X that would spark some interest, I think...) Commercial air - well, Boeing's just not making as many new models, and Airbus has its' own problems...

Architectural engineering? Dubai's the place - not the US.

Comp Sci? Not terribly attractive - though the engineering infrastructure to keep the internet going is pretty darn amazing...

Engineering needs dreamers - and there's a slight scarcity of grandiose dreams in the US any more. We need another bubble that requires some form of engineering to come to fruition - and I don't see it happening soon.

JLawson:I agree wi... (Below threshold)


I agree with a lot of what you said, but ...

It isn't that civil engineering isn't glamorous, the problem is that it is dominated by government spending. If the manufacturing sector is retreating while the public sector is expanding, the economy isn't sustainable. The country ends up spending more for roads and bridges than it can afford (because it isn't producing enough).

Similarly, there is a lot of engineering that goes on in aerospace that is also dominated by defense spending - also government.

Computer sciences is a loser, too. Many of the jobs are moving off shore to places like India, China, and Eastern Europe. Low-end fix-it jobs for computers are available, but a lot of those jobs pay little better than Walmart.

Engineers that I know love to create things, but there isn't much of a market for dreams anymore. It's cheaper and less risky to build those dreams in other countries.


The basic problem is that this economy that we're talking about is not sustainable. Too much money is being taken out of the private sector and being shifted into the public sector. Too much money being borrowed to spend on new State projects, and not enough real wealth being created.

And then the State shall co... (Below threshold)

And then the State shall command the need for more medical practitioners - to reduce the cost of medicince. The State then forces intelligent kids into a not-really-wanted 8-year post-graduate education process, only to work at State-mandated pay grades.

Will that be the stuff of excellence, or mediocrity?

Actually, kevino, a lot of ... (Below threshold)

Actually, kevino, a lot of countries with far greater levels of public investment per capita in infrastructure than the United States are totally "sustainable" and afford engineers an awful lot of opportunity--say, Japan, Korea, Switzerland, Germany, Netherlands, France... Are you saying that Switzerland, with greater GDP per capita than the United States, is not built on "real wealth" because of the high level of public spending based on GDP?

This follows Michael Steele's idiotic remark that government has never created a job, which he clarified as never having created a long-term job, which was then qualified as excluding the military... which showed that the guy was substituting a Cliffs Notes version of an already-over-simplified ideology for actual empirical understanding of labour as it relates to public spending.

There are an awful lot of good government jobs; and an awful lot of lucrative government contracts for civil engineers. My uncle got to spend a few months of every year helping the government of Brazil upgrade some highways. Glamorous? Not really, but as a partner in that firm he earns half a million (Canadian) dollars per year while jet-setting all over the place. His company always has work, and when it's hard to find in Canada, they take contracts in the U.S.; and when it's hard to find there, they go to Latin America or Europe. It's called entrepreneurialism, being adventurous, and being smart enough to capitalize on reality.

apb: there's a difference between forcing someone to study something, and giving them a real incentive to do it--such as free tuition. Again, there is no free-market-based alternative to a critical shortage of General Practitioners. You have to choose:

1) Government intervention in the labour market;
2) A shortage of GPs, such that they are overburdened with patients;
3) A shortage of GPs, such that poor people or the very sick don't get treatment; or
4) Lowering the qualifications such that (e.g.) registered nurse practitioners can pretend to be doctors.

Obviously choosing any option apart from #1 makes you a sociopath, in that you would view the welfare of other people as an obstacle towards ideological victory. (So you'd be like a Maoist, but with the internet.)

Cubans already have a lower infant mortality rate and higher literacy rate than Americans. The French live longer. Do you really think your country can sustain a further decline in GPs per capita? Do you really think that the current free market model (expensive schooling, relatively low wage after 8 years of expensive tuition) is sustainable? Would you prefer to live in a Second World country (think Poland, Hungary, or 1970s Israel) if it meant smaller government?

Hyper -Re infant m... (Below threshold)

Hyper -

Re infant mortality - I recall seeing a couple of years ago an article stating that one reason why the US infant mortality is so high is that we report everything - and a lot of countries don't.

Bernadine Healy, M.D.: Behind the baby count - US News and World Report

We're a nation of beautiful babies. In a remarkable achievement, the loss of babies during their first year of life has plummeted by almost 70 percent since 1970. Yet the nation's infant mortality rate is used time and again as evidence of America's failed health system. Just last week, the Commonwealth Fund issued a score card that flunked U.S. health system performance with newborns. The reason? Our current infant mortality rate of 6.4 per 1,000 live births is high compared with the 3.2 to 3.6 per 1,000 estimated for the three top-scoring countries in the world-Iceland, Finland, and Japan. It's also higher than the 6 deaths per 1,000 for the European community as a whole. Before putting on the hair shirt, let's take a look behind these numbers as these comparisons have serious flaws. They also convey little about why we lose nearly 28,000 babies a year, a starting point if we want to bring universal health to our nation's cradles.

First, it's shaky ground to compare U.S. infant mortality with reports from other countries. The United States counts all births as live if they show any sign of life, regardless of prematurity or size. This includes what many other countries report as stillbirths. In Austria and Germany, fetal weight must be at least 500 grams (1 pound) to count as a live birth; in other parts of Europe, such as Switzerland, the fetus must be at least 30 centimeters (12 inches) long. In Belgium and France, births at less than 26 weeks of pregnancy are registered as lifeless. And some countries don't reliably register babies who die within the first 24 hours of birth. Thus, the United States is sure to report higher infant mortality rates. For this very reason, the Organization for Economic Cooperation and Development, which collects the European numbers, warns of head-to-head comparisons by country.
Increasing the number of obstetricians won't do anything to drop the numbers, so long as we're reporting everything... and other countries aren't. You can only determine so much from statistics, and if your data set isn't complete and consistent across all the samples then your conclusions aren't going to be exactly accurate...

Jlawson,I remember w... (Below threshold)

I remember when I was in college taking my childhood development course our dept head giving a few lectures on this. He wasn't the typical granola crunching berkenstock member of the Ed department, having come to teaching after a careers in law enforcement and then politics (the latter overlapping with his teaching). Anyway, I recall that Russia and the Soviet Union completed excluded babies born too early or too small, even if they breathed unassisted. If the baby didn't live at least 7 days, Russia didn't count it. As a result their IMR was reduced by something close to 25%. Japan, as another example, recored children that die in the first day as still born on a regular basis.

Hyper:RE: Lots of ... (Below threshold)


RE: Lots of countries have higher levels of government spending

Mostly because they also run single payer health care systems. What you need to do is live in Europe, have family in Europe, and have friends that still live in Europe - the way that I have and see the comparison in opportunity. Look at the lack of upward mobility, basic opportunities, general inability to get things done, and the permanent unemployment. (The riots that break out periodically in France aren't happening because they're happy with economic conditions.) Don't just visit: live it.

If you can't do that, study the economic report generated during the Clinton Administration when we came out of the recession that dominated the first Clinton years. The report points out that other G-7 countries "invest" more in government spending, and that puts money into inefficient enterprises. Those countries went into recessions earlier than the US, had deeper recessions than the US, and came out of the recession later than the US. I remember a reporter asking the Clinton economist if we aren't going down the same road by increasing spending in government. The answer was, "Yes." The reporter asked, "Well, isn't that a bad thing?" And the economist couldn't answer.

RE: Switzerland

Switzerland has a greater GDP per capita because it severely limits immigration. It's not generating wealth: it gets it's wealth by being the secret banker for others in Europe trying to hide wealth from their government, including proceeds from lots of criminal enterprises. It also got an infusion of capital by hiding wealth for all sides during WW II.

RE: "There are an awful lot of good government jobs; and an awful lot of lucrative government contracts for civil engineers."

That's what I said, but what I also said was that government borrowing is threatening to kill the economy. Try reading next time.

RE: Your reply to apb about doctors

What you fail to understand is that the free market can deal with this problem. It is the State's interference in the market that is creating this problem. Examples include:
1. State control over medicine is coming. Doctors know it. They don't want it. And so many doctors are retiring early. You people are convinced that they don't want to enter the field.
2. State programs that pay for medical services are artificially pushing down the income of GPs. Many doctors feel it isn't worth it. Some opt out of the State programs. Others choose to specialize.
3. Malpractice is a constant threat. Specializing is a great way to increase income to offset the threat. GPs forwarding difficult cases to specialists greatly reduces risk.
4. Internships are another reason that some of my friends choose not to go into medicine. It's an exhausting process, and it isn't a very good way to train doctors. The system lives because it is the way that young, half-trained doctors are allowed to practice on the poor. The State likes the system because they get to fill hospitals with essentially slave labor.

There is a shortage of Prim... (Below threshold)

There is a shortage of Primary Care Physicians because:

Fewer physicians were produced AT THE GOVERNMENTS MANDATE because of a supposed physician glut causing an increase in the cost of medical care. Federal government support of medical education was drastically cut in the mid-seventies because doctors were perceived as making so much more money than they had BEFORE Medicare and Medicaid were instituted (which also caused a ripple in the third-party payor systems) and were so rich they could "afford" to pay for their own education. Tuition quadrupled instantly in 1977. I remember because I graduated in 1976 without any debt.

Physicians graduate from medical training hundreds of thousands of dollars in debt and in order to pay this off, they seek the highest paying jobs - specialty and subspecialty practices in private practice that serve patients with high paying third party payors.

Physician reimbursement is based upon a system that pays by procedure, and the payment-by-procedure scale is acutely sensitive to lobbying efforts by surgeons (including ophthalmologists), procedure based specialists, and radiologists - they already have the most money and the best financed professional organizations to lobby for them. The effort to improve primary care reimbursement by the RVU system was hijacked and corrupted to serve these entities. Who has the control of the major payors that set the example for these payment schemes: the Federal Government.

So if MR Obama is serious about wanting to increase Primary Care providers, he needs to STOP the Federal Government interventions that have contributed to it and support Federal Government support of Medical Education. The USPHS scholarship program is not an adequate model.

Basically, the majority of Scholarship providers that go to underserved areas to pay back their "debt" leave as soon as their debt is paid off to more lucrative jobs in more "desirable" areas (to their families/spouses if not themselves). Thankfully a few stick around.

When providers can make more money seeing primary care patients in a rural area than they can reading x-rays or performing liver transplants in NYC, then there will be no more shortage of primary care physicians.

When the medical management of cardiovascular disease (without procedures) that has been found to be generally equivalent to interventional medicine is paid as well as placing a stent and performing and angioplasty, then Primary Care providers will be popular role models for medical students.

Mr Obama's approach to the problems above would likely entail DECREASING payment to specialists out of proportion to any increase in pay to primary care providers, increase the number of USPHS Scholarships and likely add more time and control to the "pay-back" schemes involved, and establish a single-payor system under Federal control.

So we're comparing apples t... (Below threshold)

So we're comparing apples to oranges, SCSIwuzzy. Funny how those little things never seem to come up when the IMR numbers are discussed.

Makes me wonder just what Cuba's reporting standards are.

Found this bit on the Wiki for Cuba's Health Care, for what its worth...

According to Hirschfeld the Cuban Ministry of Health (MINSAP) sets statistical targets that are viewed as production quotas. The most guarded is infant mortality rate. The doctor is pressured to abort the pregnancy whenever screening shows that quotas are in danger.[72] Once doctor decides to guard his quotas, patients have no right to refuse abortion.[72]

Referred footnote is here.

Yeah, apples and oranges indeed, with a few squash and a couple of pears and mangos tossed in for good measure...

I agree that malpractice su... (Below threshold)

I agree that malpractice suits are far too commonplace in the United States. And the qualifiers on other countries' IM rates are helpful--thanks.

That said, I still don't think that the market will solve the problem of physician shortage when the same student could go into finance instead and earn three times as much money. The collapse of Wall Street's house of cards and the Administration's emphasis on public service might help alleviate the looming shortage of physicians--or perhaps you'll have to start rationing health care, in which case you may as well adopt a single payer system.






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