The U.S. economy clearly faces some major challenges. The issue is whether or not we, as a society, are preparing to meet those challenges, and the most obvious way to do that is to give the whole society the best possible foundation. Unfortunately, since the Recession of 2008, exactly the opposite has occurred: strengthening the 1% by undermining the 99%.
In his intentionally provocative but nevertheless solidly researched Economic Collapse blog, Michael Snyder posted this very scary U.S. Treasury chart illustrating the exponential growth of U.S. national debt. Arguments over the significance of the huge overall debt or the enormous increase over just the last year need not obsess us: the point here is the word “exponential.” Those who have spent their life trying to avoid any mathematical thinking at all should read “avalanche.” In case you missed the endless Great Recession of 2008-??? brought to you by those great men on Wall St. who now pretty much own the nation once again (after their control slipped a bit following their previous major screw-up in 1929), we Americans are now all (except of course for the bankers, who made out like pirates in 2008, not coincidentally) walking in a financial valley beneath the peaks of high finance, covered deeply in layers of financial snow composed of deeply leveraged powder tenuously balanced on generous slices of very slippery corruption. The tortured analogy is for the innumerate, of which I confess to being one. For anyone familiar with thinking about exponential rates of change or anyone who can simply follow the curve of this scary U.S. Treasury graph, the message is pretty clear: expect an avalanche.
Of course, we have a government both more than willing to interfere with the normal march of capitalism, fortunate to some degree since we also have a financial class dedicated to the total corruption of the normal march of capitalism, so we can all assume that our government will be able to foresee the high probability of imminent disaster as well as the rest of us, right? Perhaps, though they did not have a clue in 2008, but there is another problem: we have seen very little sign since 2008 that Washington has cleaned up its act, and certainly Wall St., which won big by defrauding the nation in 2008, has not demonstrated the slightest interest in cleaning up its act. Elizabeth Warren must now be the loneliest person on the planet.
Not to be pessimistic, but there is still another problem with our financial situation, and to my mind this is even worse. Snyder and others speak of individual problems with debt; corruption; the failure of reform efforts; the continuation of leveraging; the failure to deal effectively with the cancer of empty, rotting, foreclosed housing. All true, of course, but to me the elephant in the financial room of the house American society calls home is the degree to which the vast wealth of America has, over the last generation, been taken out of the hands of the 99% and stuffed into the deep pockets of the corporate/financial elite. Am I exaggerating? Just compare the 17,000-level of the Dow Jones with the socio-economic collapse of Detroit. Detroit, not the stock market, is the symbol of the contemporary U.S. economy.
When the financial avalanche roars down on our heads, how will we protect ourselves? While Washington took care of the financial elite first by the breathtaking and secretive bailout of the billionaires followed by Treasury management of the economy to puff up yet another stock market balloon, American society was left with massive unemployment, declining real incomes, broken retirement contracts, vanishing benefits. Am I wrong? You tell me: how’s your nest egg doing, lately?
The real problem is not that America faces financial challenges but that its enormous wealth has been transferred away from potential consumers and small business owners into the very inefficient and non-productive hands of a tiny elite that has become addicted to gambling rather than production. The wealth of America still exists, but it is fenced off in a private game room for useless, and in fact pernicious, socially harmful activity.When the next big financial crisis arrives, the U.S. has the wealth, resources, population, education to deal with it through belt-tightening, but I am guessing that your belt is already tight as the result of the Recession of 2008, and we both know that those who now control the money have belts too big to tighten. So I wish you luck.