Our men's group, currently in its 17th year, is composed of middle-class
professionals -- lawyers, educators, therapist, writer, corporate manager,
doctor, etc. -- and each of us in this perilous economy in recent months has
taken a deep financial hit of one form or another or knows (or has heard of)
someone personally who is struggling to hold onto or already has lost
his/her job.
The general conclusion based on our personal knowledge, on the relevant
economic indicators, and on what we are hearing from experts and
economic-focused journalists and bloggers from around the globe, is that the
U.S. and the other nations of the world are in a deep recession and are
heading quickly toward a major Depression. This dangerous state could last
for many, many years.
We middle-class types most likely will make it through to the other side,
with a lot of financial pain, belt-tightening, supporting each other more,
joint projects, etc. The wealthy, of course, will easily weather the crisis.
But the lower-middle class and the poor, with fewer job skills and a badly
frayed "safety net" of social services, will be the true victims of the
economic meltdown. Charities and shelters and church programs will be
overwhelmed. The permanent underclass will grow at a rapid rate, with a
comcomitant rise in violent crime. Pollution-control and global-warming
projects may well be postponed or ca nceled due to lack of funds. Public
education, as is usual in times of belt-tightening, no doubt will take a big
hit, thus perpetuating the problem.
IGNORING THE WARNING FLAGS
Government economists like Alan Greenspan, Ben Bernanke and others (the
supposed "wise men" about money matters) professed to be surprised by the
major collapse of the financial system, and the housing market, that has
brought us to our present pass. Lots of sharp observers sussed out what was
coming long before, but, by and large, they were derided as tinfoil-hat
paranoids while the golden goose continued laying such profitable golden
eggs.
Economist Duncan Black, who writes under the blogger name
Atrios, had been warning for
nearly two years about what he called the "big shitpile" growing
exponentially in the country. He, and a few others, realized the
consequences and ramifications long ago, but few in power wanted to pay
attention. It was all good, as long as housing values continued their
"inevitable" rise, interest rates were low, and credit plentiful. An
occasional government insider would warn about the extreme danger of
unsupervised hedge funds and unregulated bundling of shaky mortgages and
"credit default swaps" and so on, but they too were shunted aside by many,
including a complicit Congress that should have been exercising oversight.
About a year ago, a number of the members of our men's group started asking
our financial advisors what they thought about "the big shitpile" concept,
even if that exact term may not have been used, and whether we should be
concerned. The advice we tended to get back was the prevailing wisdom of the
time: there might be a "slight, temporary downturn" in the economy, but "the
markets always bounce back" and the "longterm prospects look good." Just
ride it out. And then came the bursting of the housing bubble, the collapse
of the financial institutions and thus the easy-credit system, and the
resulting devastating market crash. And the worldwide recession/Depression.
And now we're all expected to grab a shovel and help reduce the huge "big
shitpile" stinking up the middle of our country's economic living room.
We're all in debt, including our children and grandchildren, while we bail
out the largest financial and corporate institutions -- those deemed "too
big" to risk their going under -- in hopes that the economy will be
stabilized and start slowly climbing back to health.
But, per usual, even today there is precious little oversight of these
hundreds of billions of dollars (or is it trillions??) being doled out. And,
surprise!, the banks and corporate behemoths are using our money in ways
that aid themselves but do not really help out ordinary American borrowers
and consumers all that much. The rich get richer, the politicians get to
seem as if they're actually doing something, and the "bailouts" arranged in
our names ensure that we ordinary Americans wind up as the ones paying the
freight.
AMERICAN "SOCIALISM" ARRIVES
I remember my parents talking about the Great Depression they lived through
in the 1930s, the millions of proud unemployed men that were forced to the
soup kitchens for sustenance, the "safety-net" institutions of the time that
were overwhelmed by the demands for their limited services, and the
demagogues that were stirring up angry crowds by blaming scapegoats of one
sort or another ("the blacks," "the Jews," "the Catholics," "dirty
immigrants," et al.).
The situation is so dire in late-2008 that free-market capitalists have
become, so to speak, a variant of "socialists" virtually overnight. They are
having to recognize, against their own ideology and instincts, that there is
such a thing as the "public good/public interest" and that a centralized
government has a major role to play in ensuring economic survival and a
general sense of "we're all in this together and need to get out of this
together." That's a sea-change in American political culture, which brings
with it all sorts of ramifications, some positive, some negative.
In 1932, the aristocratic New York politician Franklin Delano Roosevelt
became President and soon, faced with the reality of the crashing economy
and endangered institutional structures, found himself taking drastic
social/financial action to stave off imminent economic collapse and the
possibility of revolution.
FDR, recognizing that the most important task was to get citizens earning a
paycheck once again, set up government works projects, mostly centered
around rebuilding the country's infrastructure. The initiatives worked, with
a side benefit that the psychological mood of the country shifted away from
panic and fear into glimmers of hope and optimism. Unfortunately, it took
shifting to a full-scale war footing -- building ships and planes and tanks
and bombs -- to yank the economy back to solid health.
Barack Obama is inheriting a godawful mess as he prepares to move into the
presidency, virtually none of it of his making. The governmental/corporate
looting system that was the CheneyBush Administration, with greed as its
organizing principle and lack of oversight as its all-clear authorization,
has broken the back of the American economy. And because when America
sneezes the rest of the world catches a cold, the situation is even more
dangerous and desperate.
REBIRTH OF "NEW DEAL" PROGRAMS
Obama, some in our men's group speculated, might well turn out to be this
generation's FDR, if he has the willingness and intelligence to seize the
moment -- and luck on his side.
In his comments toward the end of his campaign, Obama talked about the
necessity to put our citizens back to work, so it's possible that he will
initiate huge infrastructure projects that will generate millions of
salaries. Likewise, by moving ahead quickly with massive alternative-energy
projects, he may be able to create millions of other "green" jobs. However,
to be able to start these massive projects, he will have to borrow immense
sums of money from the international community (read: China, which is
undergoing its own economic downturn).
None of this will guarantee success. We're talking long-range investments
here, which may pay off many years down the line. But the point is that the
federal government, after being ideologically and intellectually asleep at
the wheel for eight full years (the better to allow for the organized
looting by their corporate supporters), finally will be headed in the
direction of intelligent action.
If this means government-sponsored works projects, heavy borrowing up front
to finance the initiatives, universal health care as a way of dealing with
skyrocketing costs, tighter regulation of banks and other lenders, it
appears that the American public, even including many staunch conservatives,
will approve. Maybe we can grease the tracks for such necessary initiatives
by not using the "s" word; we can refer to these projects as
"national-security infrastructure programs" or some other euphemism.
In the meantime, many, like those in my men's group, will realize that to
get through the coming lean years, there will have to be much more sharing
by friends and neighbors of resources such as garden harvests, tools,
vehicles, work, cash loans, meals, etc. We all know that this will entail a
shared sacrifice and that it takes a village's collective wisdom and
strength to get through hard times.
It worked for our parents and grandparents, who transformed themselves and
the U.S. in the process. There's no going back now. The "big shitpile" is
where we are. We can either give in to despair and hopelessness, or, in a
spirit of hope and optimism, we can work to change things for our generation
on behalf of our children and grandchildren. In so doing, we have the chance
to transform ourselves, and our country, for the better.
Copyright 2008, by Bernard Weiner
