Editor’s note: This is the second of Ochenski’s three-part look at the year that was and how it will shape 2009.
Last week’s column looked at the unexpected collapse of the American economy from the first tremors over sub-prime mortgage foreclosures to the full-blown panic on Wall Street and how President Bush and Congress reacted to the crisis. This week, we look at the continuing effects as the combined impacts ripple through the nation while the pundits and politicos struggle to find a way out of the economic black hole they, in large part, created through deregulation, outrageously expensive foreign wars and sloppy legislation.
While Hillary Clinton and Barack Obama were wrestling for the Democratic Party’s presidential nomination, the cracks were spreading through an already sagging economy. But as usual, the reality facing ordinary citizens every day somehow escaped the notice of those living in the political stratosphere. Instead of moving aggressively to attend to the growing disaster, which was already driving thousands of families from their homes every day, the candidates made lofty promises of how much they would spend and how great everything would be if only we put them in the White House.
After eight years of George W. Bush, and a nation grown weary of pointless and seemingly endless wars, the mantra of “change” was on every candidate’s lips. Obama promised “change we can believe in,” which carried the day in his long and bloody battle with Clinton. Meanwhile, John McCain tied up his party’s nomination to become the candidate of Republican change—whatever that means. What neither candidate seemed to comprehend, however, was just how much change would occur before one of them would step into the White House. When Obama won the election, hope was truly sweeping the nation. Unfortunately, the enormous severity and widespread impacts of the economic collapse were only then becoming undeniable.
The rushed congressional bailout of Wall Street—to the tune of $700 billion in taxpayer money—took effect only a month before the election, but was already in tatters. As public money rolled into the private hands of the Wall Street pirates, stories began to hit the press about the luxury in which the bankrupted companies’ CEOs continued to live. Fiscal responsibility seemed nowhere to be found—not in Congress, not in the White House and certainly not in the boardrooms of the “too big to fail” institutions now surviving on public money. Nor, it seems, will the situation get better any time soon since Congress, in its incompetence, placed virtually no restrictions on the use of the billions of public dollars they so readily doled out.
Just this week, the Associated Press (AP) reported the results of their investigation into where the money went. In short, they can’t tell you. Why? The bailout legislation failed to mandate any transparency or require any accountability. The AP queried 21 banks that received at least a billion dollars each from the bailout funds asking four very basic questions to determine what happened to the money: How much has been spent? What was it spent on? How much is being held in savings? What’s the plan for the rest? And what did they get for answers? Nothing. Nada. None of your business. No public disclosure required and thus, none provided. The results of yet another congressional blunder come home to roost.
Meanwhile, President-elect Obama’s lofty campaign promises continue to fall victim to the collapse. Remember the pledge to repeal Bush’s tax breaks for the wealthy? Now it’s off the table—although why that should be has yet to be explained. Or how about getting out of Iraq in 16 months? That, too, has now been conveniently put aside in favor of the old Bush excuse of leaving those decisions not to those we elect, but to the Pentagon’s generals and their close friends in the military-industrial complex.
Nor have Obama’s cabinet appointments created much excitement about change. In fact, the Obama administration has already discarded change in favor of “experience and pragmatism”—code words for more of the same from the exact same people who got us into this mess in the first place. Who deregulated the banking and financial industry? Why, Bill Clinton and his Treasury Secretary Robert Rubin. And who just stepped into Obama’s cabinet to deal with the situation? Why, Rubin’s understudies and former Clinton administration officials.
One place where change actually seems to be happening is in the place where we least need it. If Obama and the Democrats should have learned anything from Bush, it’s that fighting holy wars in Muslim countries is a losing proposition. For the trillions we spent in Iraq, we’re likely to wind up with nothing more than tens of thousands of vets suffering from post-traumatic stress disorder wondering what, exactly, they were fighting and dying for.
Obama’s promise to “redouble our efforts in Afghanistan,” however, appears to be one promise he’ll keep. Just this week, the Pentagon’s masters of war announced they would be sending another 30,000 American troops to fight and die in a country no foreign power has ever been able to successfully occupy or even marginally change. And where will the money to fight this foolish war come from? Well, from the foreign countries from which we continue to recklessly borrow trillions, further endangering the nation’s future and just as surely burdening future generations who will somehow have to repay the debt.
Christmas is here, a new president is about to take office and the country should be enjoying the thought of a brighter and better future. But not this Christmas. Instead, stores are shutting down, companies are going out of business and unemployment is hitting record highs while deflation, the most feared economic dragon, raises its head to breathe flames no Washington, D.C. knight can quench.
Next week we’ll dive into 2009 and the considerable challenges ahead.
Helena’s George Ochenski rattles the cage of the political establishment as a political analyst for the Independent. Contact Ochenski at email@example.com.