Democrats simply don’t get it. They don’t comprehend that we understand George W. Bush nearly doubled the national debt, that his Administration spent eight years of looking the other way while mortgage fraud was rampant, and that he lied us into a costly war while bungling the execution of a justifiable war. They further don’t comprehend that we don’t care that they inherited the problem. They wanted to take a shot at leading, and in doing so, they assumed the problems of the previous regime. Every incoming majority assumes the problems of the previous regime, and there’s a powerful case to be made that the regulatory loosening which led to the Great Recession took place at the end of the Clinton Administration with broad bipartisan support sufficient enough to override a presidential veto. In other words, we know that both parties on Capitol Hill bear joint responsibility for the way our economy soured.
Americans don’t elect leaders to hear them make excuses. We elect leaders to deliver results. Real results, not the kind that rely on manipulated statistics to make it seem as though jobs are being generated when in fact the only job uptick is due to a round of Census hiring. The kind of results in job creation that don’t rely on excluding individuals who’ve simply given up (or, as I like to put it, recognized the obvious) on looking for jobs after realizing that the economy has something along the lines of eight applicants for every available job, and many of those jobs tell people with college degrees that they’re “overqualified.” I remember a time when a desire to work was the only qualification one needed to get a job.
I played on that qualification as a twelve year old hustling yards to mow from realtors whose listings had overgrown yards. I flipped my willingness to work for whatever was offered into gigs working for men at my church, who had fleets of trucks at their businesses which needed to be cleaned. My dad, a supervisor at a Navy boatyard and a lay minister, managed to parlay his willingness to work into extra cash by changing the oil on those trucks while his son washed the exteriors and cleaned out the interiors. Today’s economy is fundamentally different than it was ten years ago. I know from personal experience.
You see, when I moved back to Alabama as a college degreed individual with three years of teaching experience in two states, not to mention two gigs in retail management, it took me five months to get a job. Not a job, really. A part time, minimum wage, under the table gig as a guard for my future father in law’s security company. Three months later, I attained employment in a call center.
A willingness to work simply isn’t enough. A willingness to work combined with experience and a college degree isn’t enough. There’s a fundamental disconnect between what we’re told as children and teenagers and what we experience as adults. It doesn’t matter if you work hard and show up on time anymore. It doesn’t matter if you’re willing to work in the first place.
If the jobs aren’t there, they aren’t there. Every bit of encouraging economic data is directly linked to artificial demand. Declining unemployment data to a level which would indicate job creation? Census jobs. Rising housing starts, new and existing home sales? Home buyer tax credit, which upon its expiration, led to a 32% decline in home sales in April. What is more, anyone can buy a home when you give them a down payment in the form of a tax credit. I predict a round of foreclosures related to the tax credit as buyers who didn’t have the means to buy a home without government intervention will inevitably default. Rising manufacturing statistics? Appliance buyer’s credit and the assistance offered to automotive buyers. Both of these credits involved the destruction of previous appliances and automobiles. How does one create wealth by destroying it simultaneously?
The entirety of our economy is a mirage. We have low trading volume reflecting the fact that liquidity was extended to a limited number of players in the finance sector, who used that liquidity to backstop their exposure to toxic assets and to accumulate more investments in the market. When you insert $23.7 trillion liquidity and guarantees into a market, you can nearly double your market in 14 months. It’s simple mathematics.
What is more, when your ostensible justification in putting out $23.7 trillion in liquidity and guarantees is to bolster a mortgage market whose sum total between its residential and commercial sectors was a mere $21 trillion, you’ve over spent by almost $3 trillion at least. What is all the more galling is that the entire mortgage market was not underwater. For the $23.7 trillion in liquidity we issued to allegedly backstop the mortgage market, we could have paid off the national debt and had over $10 trillion to spare.
It is granted that the entire $23.7 trillion was not entirely liquid, as part of that total consisted of guarantees. But the reality of the matter is this: whatever you guarantee with public credit is the total amount you free up for investment by the private sector whose players no longer have to hold back that amount as capitalization. In a very real sense, then, while you did not issue $23.7 trillion in total liquidity, your guaranteeing of certain amounts of debt or liability freed up actual existing liquidity for investment which would otherwise have been held back to hedge against potential losses. The freed up liquidity was not invested in the traditional sense, it was instead used to speculate in the market, which skyrocketed to nearly double its previous lows.
Say what you will about all of this, the Democrats have done nothing substantive to move away from the practices which led us to the current debacle. Financial reform, like healthcare reform, isn’t about reforming anything. It’s about preserving the status quo for the future despite a long track record of failure which requires government intervention around twice a decade. Business as usual is the end to which reform by the Democrats works.
So while they admittedly inherited problems from the previous administration, they’re doing their damnedest to ensure that those problems can arise in the future. After all, government bailouts are extremely lucrative to private industry. Who wouldn’t want a $23.7 trillion safety net to invest in speculative endeavors?
This brings me to Vice President Joe Biden, who went out this week to state that the eight million jobs vaporized in the Great Recession will not be coming back. Aim low, Joe. It’s the only way to avoid the disappointments of the past which arose when you highballed the jobs numbers associated with the stimulus.
While Obama campaigned on any number of promises, he’s ruled in a manner which testifies to his honest intention to betray each and every one of those promises. A public option? Sacrificed to bring insurance lobbyists to the table, and what a table it was: they wrote the reform bill, and ensured that their industry would be exempted from free market competition by preserving the anti-trust exemption for their companies. Transparency? Obama’s minions have taken down websites and information on those websites which they deemed too transparent for comfort. Limiting executive power by repealing torture and closing down a system of secret prisons? Not so much. Guantanamo still rolls on, and our President notified Congress that he now claims the power to execute American citizens without due process or judicial review if he deems them to be associated with terrorist groups.
Obama looked upon his inheritance insofar as executive power was concerned as a mere starting point. He’s been building on it ever since. In the Senate, Joe Lieberman and John McCain are busy crafting the Enemy Belligerents Act, which would criminalize political dissent. The inheritance isn’t a problem in that it presents any obstacles, it’s a problem because it didn’t contain within it the power to execute individuals arbitrarily without due process or review. It didn’t legislate speech sufficiently by criminalizing dissent.
One wonders if the members of our Congress and their peers over at the White House comprehend that the monstrosities they are creating will one day be used against them. Imagine the shock when power shifts and the ability to classify and define speech as criminal shifts as well. What a shock it will be when Joe Lieberman and others find themselves detained indefinitely without trial or representation under the auspices of the very laws they created years before.Like Dr. Frankenstein, they will find themselves undone by their own creation.
The triumph of pessimism is this: we elected hope and change, and all we received was more of the same. In point of fact, it’s worse now than it was. Our President has the audacity to claim the ability to kill Americans without due process or review. The reform we’ve seen thus far guarantees nothing but a continuation of the very worst qualities of our insurance system, and our financial sector, and an expansion of both to expose more people to liability and loss. Whom do we have on the horizon? Sarah Palin, Mitt Romney, Mike Huckabee, and Jeb Bush. Do we really want any of those individuals running for President?
The Democrats have to deal with something even more unpalatable: the prospect of running a re-elect Obama campaign after a period in which the U.S. economy has not and will not recover due to the idiotic approach offered by the very triumvirate of individuals who created the conditions for economic collapse in the Clinton Administration: Summers, Rubin, and Geithner. Then there’s Ben Bernanke over at the Federal Reserve, whose hindsight is 20/20 and whose foresight is 20/400. Build the man a time machine and he might be worth something as a central banker. Otherwise, don’t expect much and you won’t be disappointed.
Let us all entertain the option that Obama may be forced to resign due to political fratricide in which the members of his own party seek to salvage their prospects by jettisoning his. At the present rate, it’s an entirely realistic assumption that Democrats may seek to turn Obama into the second coming of Lyndon Baines Johnson. The truly deplorable state of American politics is this: is there anyone who could do any better than Obama, or is it that they couldn’t possibly do any worse? Therein lies the key to the triumph of pessimism.