I am at the Take Back America conference in Washington DC.
One common discussion here at Take Back America is that conservative economic policy chickens are coming home to roost. Another phrase I am hearing is Wild West Banking. People here are talking about the big story in the news right now: an economic and financial crisis that some economists are saying is the worst since the depression.
For decades, as conservative economics increasingly led to lower wages, loss of pensions and health insurance, and general “you’re on your own” economic insecurity many people have been using up their savings while other people turned to borrowing to make up the difference, taking out second mortgages or running up credit cards.
Meanwhile the financial system, increasingly deregulated, cooked up riskier and riskier schemes — like loaning money to people and companies to use to make their payments on their existing debt.
Now we appear to be reaching the limit of people’s ability to borrow. And when people and companies have been borrowing to meet their payments this can mean a collapse. When people can’t pay the mortgages the financial companies aren’t receiving their payments. So they can’t make their payments, and the companies they aren’t paying can’t make their payments. Think of this as a spiral of debt extending from the overextended consumer at the bottom to the biggest financial companies at the top. Now that spiral is beginning to “unwind.”
This is happening because of so many years of conservative government focused on deregulating and on protecting the interests of the corporations and the wealthy instead of protecting the interests of the public from the moneyed interests. This is what conservatives do. A while back I wrote a very short post titled Republicans and Economics:
…there was a REASON that Americans were loath to elect a Republican into the government for an entire generation after the Great Depression: They remembered.
But eventually the public forgot, and the moneyed-interests used their money to again become the dominant voice in the public discussion. They used this dominance to persuade people to dislike unions, accept 401Ks as alternatives to pensions, and all the rest of the things that have led to another economic crisis. But even many of my progressive readers didn’t understand what I meant. So I had to add an update,
Previous generations REMEMBERED. There was nothing to add. Over time people have forgotten how Republican economics caused the depression, and how they fought every single program that helped the people at the expense of the wealthiest and the powerful corporations. (And in fact led to the prosperity that the wealthiest and corporations enjoyed since.)
But now people do not remember how concentration of wealth, corporations preying on citizens, anti-union policies, etc. LED TO the economic collapse.
The depression was ended by pro-union policies, redistributive taxes, REGULATIONS on businesses and the fuinancial sector, and an understanding that We, the People run the government, and the reason we have corporations is for OUR benefit, not just the benefit of the few.
Over time, as I said, people forgot. And here we are again.
How do we help the public understand what is happening and how conservative policies are responsible?
One possible way is to use a shorthand — call this the “Iraq Recession.” It isn’t entirely accurate, but it does lay the blame exactly where it belongs. Up to three trillion dollars will be spent by the time we are out of Iraq, assuming it ends soon. And Iraq is entirely a Republican enterprise. So this shorthand places the blame where it belongs. What do you think?