Are our politicians running the country over a cliff?

Does it seem strange to anyone the way politicians are proposing to fix the economy? So far, the only solution that either party seems to propose is to reduce the deficit. How is that supposed to produce a viable economy? I am not an economist but I believe we are in for a year of campaigning about deficit reduction solutions that won't solve anything.

What turns on my worry is the latest edition of Investment Outlook written by Bill Gross, manager of [what is said to be] the largest mutual fund in the world.

This is what I get from his new Outlook.

Both parties seem to believe "that balancing the budget will magically produce 20 million jobs over the next 10 years."

However,

"over the past 10 years, under both Democratic and Republican administrations, only 1.8 million jobs have been created."

In the mean time

"the available labor force has grown by over 15 million."

So what miracle power will enable any administration to produce 20 million jobs in the next 10 years?

At a time when interest rates can go no lower, we as a country are "untrained, under-invested and over-indebted relative to our global competitors."

At the same time,

"politicians feel that fiscal conservatism equates to job growth." However, "if implemented too quickly [it] could stultify economic growth."

Here is Bill Gross -- the guy who manages the largest bond fund in the world -- saying

"government must take a leading role in job creation.... In the short term, no rational observer can believe that global or even small businesses will invest here when the labor over there is so much cheaper. ... Our labor force is too expensive and poorly educated for today's marketplace."

He quotes the former Washington University economist Hyman Minsky --

"a modern-day economic godfather who predicted the subprime crisis. 'Big Government,' he wrote, should become the 'employer of last resort' in a crisis, offering a job to anyone who wants one -- for health care, street cleaning, or slum renovation."

What the politicians seem to miss -- and our country will ignore at a terrible cost, I fear -- is these

"dominant headwinds that cannot be dismissed: 1] Labor is much more attractively priced over there than here, and 2] U. S. employment based on asst price appreciation/finance as opposed to manufacturing can no longer be sustained. The 'golden' days are over."

Western civilization prides itself on its rationality, it's ability to assess pitfalls ahead and adjust. So, where is the adjustment? Is anybody thinking about where this country is going? One of the problems with the power of interest-driven arguments is that the various interests involved in state building are preoccupied with short range benefits. Our system is set to re-assess, rethink every four years. Four years of planning driven by powerful corporate interests may drive the country over the cliff. Can there be a return?

Here is Bill Gross's assessment:

It is clear, however, that neither party has an awareness of the why or the wherefores of how to put America back to work again.