It’s been a wild ride both personally and nationally this week. On the personal front I haven’t been home before 10:00 on three different nights this week…and…I just barely crawled across the finish line on Friday…On the national front the stock market has experienced some of the wildest fluctuations in history due to the collapse, bankruptcy, and bail outs of some of our largest financial institutions…While I have taught economics for over 15 years I confess I don’t know what to make of it all and am reluctant to offer any specific suggestions or criticism at this time regarding the governments response to the current economic meltdown. In other words, I am in a “let’s just wait and see” mode. While I don’t have any strong admonitions or thoughts about the recent actions by the current administration I do have some very strong feelings about the various events surrounding this economic debacle. Here are a few of my thoughts.
1.I have a really, really, bad feeling about our current economic situation. While I understand the rational for bailing out the various financial institutions I don’t have much confidence that this plan is going to rescue or solve our serious economic woes anytime soon. The government has added an additional trillion dollars to a debt that has already doubled over the past eight years…and…I can’t help wondering “when” this is going to trigger some serious hyper inflation which will completely wipe out the most economically vulnerable of us in a flash.
2.While I do empathize with those who suggest that we restrain ourselves from too
much finger pointing I do believe that the current administration and those who support without reservation a “trickle down”/ absolutist laissez-faire approach to the relationship between the government and economics do bare a significant amount of responsibility for the serious mess we find ourselves in. Some have suggested that almost everyone is to blame, including, homeowners who supposedly should have known better to buy a house they could not afford. While I concur that there is enough blame to go around it is hard for me to blame people for wanting to own their own home when given the opportunity. While George Bush is certainly not the only person to blame I do believe his administration and the economic advisors he consulted with contributed to the environment that allowed for the economic carnival atmosphere which has been par for the course on Wall Street since George Bush arrived at the White House eight years to go.
3.While thousands of employees and tens of thousands of investors stand to lose almost everything it currently appears that fat cat CEO’s will walk away almost unscathed. Richard Fuld of Lehman’s Brothers has made in access of 350 million dollars over the past five years and there are reports that some of the CEO’s are now hiring lawyers to secure what money is still owed them. Personally, I find this aspect of the current economic meltdown morally repugnant. Republicans like to assert that critics of their trickle down economic philosophy promote class warfare but I can think of no better way to stimulate class warfare than to create an economic environment where there is such a gap between the workers, managers and owners…and…it is “my hope” that politicians on both sides of the aisle will come to the place where they are willing to put some teeth
Final thought…Earlier today the federal government pumped billions into preventing the stock market from slipping into oblivion which caused another round of frenzy activity on Wall Street. While the recent action by the feds may have temporarily stopped the bloodletting on Wall Street it remains to be seen what will happen in the weeks and months to come. It is my hope that our economy will gradually rebound in the months to come but it is my suspicion that there is more bad news to come as the “perfect storm” is not finished wrecking havoc on our economy. Conservatives like to assert that government regulation will doom our economy and while I do believe there is some truth to this assertion I have also come to the conclusion that if business doesn’t regulate itself it will only be a matter of time until the government steps in and does what apparently the business community lacks the will to do for itself...and...if our financial institutions become socialistic in the process than the carnival ring leaders of Wall Street will have no one to blame but themselves.