The sky hasn’t fallen.
I suspect you already know that, but roughly a week ago we were being assured by the the White House, the Treasury, the Federal Reserve, and the congressional leadership that if Congress did not act immediately to avert economic disaster, the credit markets would freeze and the stock market would collapse. Congress did not act – indeed, long past Treasury Secretary Henry “Leave Everything to Me” Paulson’s putative deadline, a bipartisan House rejected the Bush-Paulson plan, as tinkered by the Democratic and Republican leadership.
The credit markets did not freeze, and, despite a dramatic one-day drop, the stock market did not collapse.
That is not to say that we’re out of the woods, nor that we can afford to be cavalier about what is certainly a dangerous financial situation for all of us, not just Wall Street. Like most people, I hope to be able to retire some day, and my family’s financial future rests largely on invested pension funds accumulated in various jobs over the years, now put thoroughly at risk because of complex and faulty financial schemes pursued by the same high-stakes gamblers who are demanding that you and I stop the roulette wheel and pay their tab.
As likely as not, by the time you read this, the Senate millionaires will have come to Paulson’s rescue, the House GOP rank-and-file (predictably bribed by a tax cut) will have been whipped into line, and a bill not much different from the one just defeated will pass. You and I will be the proud owners of many billions’ worth of currently unmarketable assets, and the international stock traders will cheerfully return to making money on our money. The credit markets we all rely on, however, will not appreciably thaw, because nothing will have been done to fix the underlying economic predicament – the collapsing national housing market – and we’ll stumble along until the next crisis, or the next administration, which will have to pick up the pieces.
Roosting Vultures
On Tuesday, before the anticipated Wednesday Senate vote, I spoke briefly to Austin Rep. Lloyd Doggett, one of the 95 House Democrats who voted against the original bill. (It’s worth noting that House Democratic leadership was not entirely crestfallen at the Dem opposition; they in fact wanted the Bush bill to be carried primarily by the Republicans.) In his floor statements, Doggett had spoken strongly against the take-it-or-leave-it posture of the draft three-page bill, and even more strongly of the crisis atmosphere promoted by Paulson and the White House and their insistence that if the bill is not passed as is, certain disaster will follow. To Doggett, it was all too reminiscent of the standard Bush operating procedure. “Like the Iraq war and the PATRIOT Act, this bill is fueled by fear and hinges on haste. … Action or inaction – that’s a false choice; it is a matter of never seriously considering any alternative to just giving $700 billion to the same Bush administration that has done so much to create this crisis and for whom the vultures have now come home to roost.”
A few days later, Doggett didn’t have much reason to change his mind – “all these [threats of disaster] are designed to build fear” – although he was quick to acknowledge “a very serious financial challenge that needs prompt attention.” What continues to bother him and other opponents is that the current bill retains its initial structure: granting billions for transfer to investment firms and enormous power to the Treasury, without sufficient taxpayer equity or adequate oversight. As he put it on the floor: “Not even Avon and Mary Kay can compete with the cosmetics in this bill. This 100-page bill: three pages of what Secretary Paulson would do, 97 pages of what he could do, plus excuses for approving the first three pages.” Unless the newly proposed Senate bill changes significantly from that pattern, he said, he’ll likely oppose it. “As long as it does not get Wall Street to pay the costs and leaves the taxpayer unprotected, I’m inclined to vote against it,” said Doggett.
Asked why he thought House Speaker Nancy Pelosi and other Dem leaders support the Bush proposal, he said: “They don’t want to be held responsible if things [in the economy] turn bad, but they also want it to be Bush’s bill, so they haven’t changed it very much. … I understand their logic, but I don’t agree with it.” The result might well be described as the worst of both worlds.
Never Again
Assuming some sort of massive bailout – still the accurate and damnable term – passes, where will it leave the rest of us? While it might be gleeful to watch the mighty falling, whatever happens we can all expect a harsher job market, tighter credit, fewer opportunities to alter or improve our circumstances. That’s if we’re lucky, and the whole economic house of cards doesn’t domino and collapse in the next year.
But once we do, in fact, save the well-padded behinds of these pinstripe hustlers and well-manicured con artists, never again should we listen to them when they whine, “We can’t afford it.” Much more than predictable stock and credit markets, this country needs a decent, universal health-care system; a rebuilt national infrastructure; sound, permanently funded public education; decent and affordable housing for every citizen; expanded and affordable higher education for any qualifying student; and massive investment in renewable energy and environmental protection. And that’s just for starters.
During the past eight years, thanks to the current regime in Washington, we’ve spent trillions on two unnecessary wars that continue to devour blood and money, and we’re now about to spend $800 billion or so on fixing a mess made by greedheads who for the last decade have aspired to make King Midas look like St. Francis. If we’re required to save their sorry asses, we should at least never let any of them tell us, ever again, that we can’t afford to spend the money to build a country fit for ordinary citizens to live in.
This article appears in October 3 • 2008.
