Now that the mid-term elections are over, it’s time we get back to the business of correcting our banking industry. But before we do, I’d like to talk a bit about the recession, and the realities that go with it.
You see, what happened in Congress as a result of the election – with the Republicans gaining control of the House – is a direct reflection of the unrealistic expectations the people of America have developed. I’m not going to say that the Repubs gaining control is necessarily a bad thing even though they have done their damndest to stymie nearly every attempt by the White House to get this nation back on track. But the reason that all of the pundits are giving as to why the Repubs did so well in the election is that America doesn’t think the Obama administration is getting things done quickly enough.
I’d like to remind America that in 1929, due to similar conditions in the financial industries, the stock market crashed and sent this nation and the rest of the industrialized world tailspinning into a depression. Banks failed. Unemployment soared. People became homeless (sound familiar?). And it took over ten years and a World War to claw ourselves out of that mess. The Depression didn’t happen overnight. A decade or more of recklessness led up to the Wall Street crash, and there was a modest rebound during 1930. Yet the economy tanked severely and, four years after the Depression started, America's economy hit bottom. Personal income, tax revenue, profits and prices dropped. Unemployment reached 25%. Construction was virtually halted in many countries. Farming and rural areas suffered as crop prices fell by approximately 60% *. And it took the following 9 years to rebuild this nation’s economy.
President Roosevelt implemented programs across the nation to create jobs. Under acronyms such as WPA (Works Progress Administration), NRA (National Recovery Administration) and more, people went to work building the nation’s infrastructure… bridges, public buildings, roads, tunnels, many of which are still in service. Via the radio, Roosevelt spoke often to the American people and reminded them that the work to be done was not entirely outside the home, but started with the way they thought… that through patience, dedication, sacrifice, and hard work a brighter day lay ahead. Our country hosted two World's Fairs during the Depression to help spur the economy and - especially in 1933 - create much needed jobs. But just as the skies started to look clear again, war broke out in Europe and the Japanese bombed Pearl Harbor. Rationing, conversion of industry to war production, sales of War Bonds, an effective propaganda machine, and a genuine involvement of the American people in the war effort got us through to that brighter day. By 1947 – eighteen years after it began - the effects of the Depression were finally over and we entered into our nation's greatest period of prosperity.
By contrast, the current “repression” (a term coined to describe a severe recession that borders on a depression) has come about as the result of three decades of undoing the financial industry safeguards implemented during the Depression, plus a shift on the part of many stock market investors toward real estate, and our culture’s greed, apathy, and selfishness. Unlike the Great Depression, our Repression commenced with a war waged by us upon the Middle-East – a war of political hubris for which we have not been asked to sacrifice anything but our young. There have been no rationings, no war bonds drives, no overall conversion of industry, and the attempts at propaganda have been tremendously weak. In fact, as you may recall, the Bush Administration handed out tax breaks to encourage the public to buy gas-guzzling SUV’s shortly after we dropped the first bombs on Iraq. Hubris made for weak attempts at national morale building and mobilization of the people toward the war effort. The war quickly used up our nation’s tax reserves and sunk us into massive debt. The Fed dropped the interest rates and banks loaned money for millions of properties they knew to be grossly overpriced in a betting scheme dubbed the “greater fool theory.” These actions set the stage for the tanking of our economy.
Since the beginning of the Repression, the American people have demonstrated a vehement unwillingness to give up the ways of life we had grown accustomed to during the previous thirty years of excesses and recklessness. Prices and profits have not, for the most part, dropped, except in some housing markets. Food costs more on the whole. Taxes keep going up while our state and local governments cut jobs. Businesses close or lay off employees when their intake can no longer support the costs. And we Americans keep cluttering our lives with as much technogarbage as we can afford. There have been no public jobs programs created. And our banks, which had the power to stop this Repression before it raged out of control, continue to flagrantly pay themselves with profits purloined from their customers - yet we haven’t committed ourselves to withdrawing our support from the thieves that rob our meager savings so that they may live ridiculously high on the hog.
We Americans are not invested in our own recovery. Instead we whine and complain, point fingers, and accuse the clean-up crew – the Obama Administration – of not doing enough quickly enough.
GET OVER YOURSELVES!
Let’s face it… it took 18 years for this nation to dig its way out of the Great Depression which took roughly 10 years to create, and the country (population 122,775,046) was invested in the act of recovery. We are currently NOT invested in our own recovery from this Repression, which took 30 years to create. And we expect the President alone to recover this nation with a population 2.3 times larger (2000 census) than the population at the start of the Great Depression, in the span of time it takes to send a text message. What gives?
Here is the hard truth. We ALL must invest ourselves in recovery. It means we stop passing the blame and start looking in the mirror. Every one of us has had a hand in creating this mess. While the banks were raping our accounts we continued to bend over for them rather than standing up for ourselves and putting our money into more customer-friendly institutions. We let the government remove the safeguards that protected our economy and continued to elect public servants who demonstrated a lack of interest in serving the public. We became selfish, and greedy, and focused on immediate gratification, no matter the cost. We lost sight of the plights of others as we tried to amass everything from wealth to clutter. And many, many people foolishly paid way too much for property instead of exercising the most powerful word in the English language: “NO.” We have sat idly by, passing our decision making powers to others.
The current economic mess may take many, many years – even generations – to fully repair. Especially if we continue on as selfishly as we have. That’s the real, hard truth. And we as a whole need to face that truth.
If we are to see progress, we have to be involved with it. The more we invest ourselves in our recovery, the more quickly it will come about. But it will not happen overnight, no matter how fully we commit ourselves. That’s because we have 30 years of bad behavior to correct. The sort of impatience that was demonstrated at the polls on Tuesday will not speed things up. We have shown that we truly do not understand the breadth and scope of what our current President is dealing with. We have shown a shortness of memory that comes as a result of our own selfishness and impatience. We have shown that we are unwilling to wade through the murky waters with him or lend him a hand in pulling the proverbial car from the ditch. We have shown that we are unwilling to make necessary sacrifices - we still expect we should have it all. And because of these things, our nation rewarded the party that has blocked nearly every reform the President has set out to accomplish by giving them more seats in the House of Representatives. We have bought into partisan spin rather than looking through our own eyes at the nation as it is. And we have opted to recline in armchairs while expecting a handful of people to fix a mess we each had quite a hand in creating.
I suggest we stop putting the burden for our own lack of restraint and our own un-watchfulness onto one man and his cabinet, or the Congress, and start accepting our role in what went wrong. I suggest we acquiesce to the idea of expecting less – less money, less in the way of creature comforts, less of our politicians – and immerse ourselves in the recovery of our economy. I suggest we eliminate greed and apathy from our day to day dealings. Stop trying to screw thy neighbor (or one-up him). The less we expect the more we shall receive. I suggest we extend a helping hand whenever we encounter someone less fortunate. I suggest we mobilize and pull our support from businesses that treat us - and our money - with disrespect.
I suggest we change our world one day at a time.
Insofar as our dealing with our government and the banks, we still must demand severe bank reforms, including the reinstatement of the policies that limited the actions of banks, which came about as a result of the Great Depression. Those policies worked until an overconfident President Reagan began chipping away at them. And above all, we must let the banks know that “business as usual” no longer flies with us. We must take back our power by taking back our money and lending it only to those institutions that have demonstrated respect for their customers and support for our communities. In order to effect change we must first change ourselves.
And let’s now be realistic for once. Let us accept that the recovery from this Repression will take as long as it takes, and not point fingers of blame at the clean-up crew before we first point them at ourselves.