Monday, March 9, 2009

On the Current Economic Crisis

There is no "saftey net" for people like me or the millions of others who are holding on to the middle class by their fingernails.

There's a net for the banks and the insurance companies and the auto companies. Supposedly there is some magic line that I can't see but others can. It's the line called "too big to fail." I don't get why the small, well-run, family-owned company that has been in business for years can be allowed to go under with no help at all, but General Motors gets billions! I don't get why the government is giving AIG another $30 billion when it already pissed away the billions the taxpayers of American gave it only a few months ago.

There is no "net" for people who bought houses they actually could afford to pay for at the time they took out the loan but can't pay for now because they've lost their jobs through no fault of their own. There is a huge, golden net for the bankers who, knowingly, handed out money to people they knew probably wouldn't make their payments. Why is their poor judgment (and greed) our responsibility?

I really like a lot of what is in President Obama's stimulus package. He appears to be trying to keep at least some of his campaign promises. He is committed to health care, education and the environment and it appears he's going to make a good run at putting America's money where his mouth is, which is what we elected him to do. But it seems counter-intuitive to me that America should dump billions of dollars we do not have (because of the hundreds-of-trillions of dollars of deficit) into poorly run, badly managed, old-school businesses, when we need to spend what money we may be able to scrape together on things that will help us move forward.

Instead of shoring up those bloated giants that have done so much to damage our economy, I think the government should let them fail. Instead of dumping billions into known black holes, we should spend the stimulus money helping laid-off employees over the hump: we could give them breaks on their mortgages (the ones they could afford before they lost their jobs) until they get new jobs, provide money for retraining workers for different occupations, help pay school tuition for their children while the parents are out of work, perhaps even increase unemployment benefits or extend the period of eligibility.

The old saying that "what is good for GM is good for America" was true at the time. In a kind of ironic way, I think it is still true. What GM (and America) need right now is not for the government to continue to "enable" business-as-usual as it has been conducted both in business and government. GM (and America) need to reinvent themselves. Our corporations (and our government) have become too large, bloated, impersonal and unwieldy. I think we should let GM and AIG - and all the other big companies whose greedy business practices got us into this mess -- fail. Let them go under. Good riddance.

From their ashes, I believe we would soon see spouts of smaller, leaner, more efficient companies. American entrepreneurship would have fertile ground on which to feed. The government could nurture that growth using more of the stimulus money with tax breaks, incentives and other support to allow those businesses to get off to a good start so they can begin hiring and retraining all those unemployed people.

The problem with those ideas is that it would run into objections from the unions (which aren't as powerful as they used to be, but they still have enough clout to put a monkey-wrench into the works of any sensible plan that requires sacrifices on the part of employees) and the large corporations (of course). I think both of those obstacles could be worked around due to the emergency we face. If the grassroots people would demand it, we could do it.

The biggest obstacle to undertaking a massive push to reinvent America is inertia on the part of the American people. The American people are spoiled and unwilling to make the sacrifices necessary in order to change our way of life. We persist in believing (even today) that we can conduct wars abroad and deal with massive problems at home without have to make any personal sacrifices or change the way we live in any way. Too many of us have developed an myopic, parochial and SELFISH views of our world. The Reagan era still echoes in the belief, encouraged by certain evangelical preachers, that our prosperity is somehow proof of our virtue and that the needy are poor because they are lazy.

We have gotten in the habit of looking doing that which is good for us, without regard to the Common Good (which is what Government is supposed to be about). Recently, a nearby senior-only community petitioned to be relieved of the burden of paying property taxes for schools based on the fact that they had no children in schools living in the community. Where I used to live, the Catholic school parents would launch huge campaigns against tax increases for schools because their kids weren't in the public schools. I will rant another day on the subject of Americans' attitude about paying taxes.

Americans continue to live in houses that are bigger than we need, on more land than we need. Our roads are clogged with big pickup trucks and SUV's that both waste gas and pour money into the coffers of organizations like Exxon and OPEC.

President Obama has been criticized lately for being too gloomy. Say what? President Obama has been doing something novel and almost unheard-of for a president: he's been telling us the truth. I, for one, appreciate that. But now that he has laid out clearly the picture of where we are, he needs to spin a vision for us of where he wants us to go. That is the real power of the presidency. That is what I voted for.

Our truly great leaders (presidents and others) understood the power of Vision and used it, sometimes masterfully (for both good and for ill). America was born by a miracle triggered by a few people attempting to do the impossible. The vision of a free nation not subject to the divine right of kings ignited rebellion; the war and birth pains of the new nation required commitment and sacrifice from all Americans. Later, America rose from its own ashes after the Civil War, largely because of the Vision of "a nation of the people, by the people and for the people" President Lincoln had left as his legacy. America joined the world as a leader in WWI, when we banded together to follow President Wilson in "Make the World Safe for Democracy." President Roosevelt led us out of the Depression by exhorting us to face our fears with courage. We took President Kennedy's challenge of beating the Russians to the moon; whether that was a worthy goal or not is debatable, but it gave us one thing we could all support and share during a dark and dangerous decade.

Perhaps the president who used the power of manipulation of "the vision thing" the most successfully (and nefariously) was Ronald Reagan. At a time when Americans were in the throes of a Recession and involved in several international quagmires, instead of digging in and doing the hard work of making hard choices and meeting the changing needs of our world, Reagan handed America a Big Lie. He gave us a backward-looking vision of an Andy Hardy America where good people who work hard would inevitably prosper. Millions of would-be Gordon Gecko's proceeded to get rich and thus was launched a decade of self-indulgence that hadn't been seen in this country since the Roaring Twenties. I never went for the brass ring, but even I'll admit, the Eighties were a hell of a lot of fun. The downside to Ronald Reagan's vision was that it blamed the poor for their plight, and took no responsibility to help them. While the rich got richer, the poor underclass grew in numbers and got poorer. Anybody who's ever picked up a history book should know that a country with a small, rich upper class and a large (and growing) underclass is in trouble. In America the middle class serves as a safety valve, but the middle class in America is eroding. The Reagan "Vision" and the arrogant high-handedness with which he and his successors dealt with other nations, sowed the seeds we are reaping today.

The challenge for this Administration will be to find a message, a new (and forward-looking) vision that will inspire Americans to overcome our inertia and to work together to transform our country into a land of "liberty and justice for all." President Obama needs to uncork some of his amazing rhetorical skills and start speaking to We The People of the United States of America. He's told Congress what he wants it to do. Now he needs to talk to the rest of us. President Obama has spent a lot of Sundays in his life listening to inspiring sermons by black preachers who knew how to offer hope where there would seem to be none and inspiring people to have strength to get through tough times, so he should know how to do what needs to be done.

Like President Roosevelt, he needs to give us hope and assurance that we can and will get through these bad times. Like President Kennedy he needs to challenge us to rise above it (because Americans love a challenge more than anything else). Like President Lincoln, he needs to model the confidence, courage, faith and perseverance.

Like another great black leader in America, he needs to stand on the Capitol steps and say, "I have a Dream." He needs to make his Dream become Our Dream. MKL's dream that the sons and daughters of slaves and slave owners could live in peace and equality was a good dream, and necessary. Someday I hope we even make it come true. Obama's dream has to be even bigger, however. We now live in a global world. We have to include in our vision for the future not only the good of the children of American slaves and slave-owners, but all of Earth's Children. We will have to include the good of our Mother Earth itself in the Dream.
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