Roubini is Wrong

... but not by much.

I love listening to Nouriel Roubini, the economist professor from NYU who called the crash correctly. He's a voice of reason and his opinions are always well-considered. Having said that, as I've listened to him and other economists talk, I've come to the conclusion that Nouriel is sometimes just as culturally blinded as the rest of them.

When faced with the issue of the Greek debt crisis, Nouriel correctly points out that the Greeks are insolvent. Their wages are too high to be competitive, so economic growth is unlikely until that falls. Their government budgets are way out of whack and if they cut them, it will probably lead to a recession. All kinds of havoc will ensue. And that's where his analysis ends.

There's another side to the equation, one that afflicts us here in San Diego as well and that is over regulation. In Greece, as I understand it, you need approval from 11 (or is it 17?) government entities to start a business. Growth by human creativity is impossible because the government strangles it. Here in San Diego, we considered building an addition on my wife's old home instead of moving. The building regs were such that it was impossible, no matter how reasonable it was. We couldn't work anything out with our neighbors, either. Instead, the government told everyone what to do with conflicting, confusing and monstrous regulations on every phase of the effort. So we gave up that idea and our potential contractor lost business.

The Greeks (and we here in California) have an untapped source of revenue - their citizens. If they placed less power in the hands of the government and more in the hands of their people, they could, without changing budgets or wages in any way, increase economic growth instantly. The fact that even a brilliant sage like Nouriel doesn't make that a central point of his talks or essays indicates just how indoctrinated our society is in the religion of government omnipotence.

My building permit was denied, my truck was cited for improperly inflated tires, my children were seized by the government because I let them play with a BB gun and the cross on my front lawn was taken down by court order, but I'm still happy! They let me keep my old dental work, pending further review!