It cannot be emphasized enough that the greatest economic crisis since the Great Depression is the fruits of a bipartisan effort. Democrats joined with Republicans to suspend the laws of economic nature by throwing the rulebook out. Similarly, the catastrophe that this harebrained effort has wrought is affecting Democrats and Republicans alike. Yes, those fundamentalist Sarah Palin huggers may be praying more than the rest of us about not losing their jobs and their homes, let alone having to convert their den into a bedroom for Uncle Leo because they can't afford to keep him in a nursing home. But they are as shit out of luck as the rest of us.
Still, it is difficult to not heap most of the blame on George Bush, who after all inherited a thriving economy and healthy budget surplus and then presided over -- or rather yet again abgrogated his responsibility to lead in time of crisis -- as the economy unraveled at a terrifying pace, several million people lost their jobs and the budget and trade deficits grew to record levels.
As economist Joseph Stiglitz notes in a must-read essay in the new Vanity Fair, even as the first wave of foreclosures and other early-warning signs of a recession broke on the American shore, the administration merely talked the talk and was utterly disinterested about addressing the underlying problems.
With Bush outtahere in only 37 days, that's hardly worth noting, even if the Rovian effort to portray his economic legacy in positive terms makes one's blood boil.
But what is worth noting -- and is horrifying to contemplate -- is that even with a president-elect poised to take over whose mantra has been hope and change things are gonna get worse and it will take a years-long bipartisan effort to restore a modicum of economic vigor. That demands a sea change in the culture of not just Washington but the financial markets, as well, that I find it very difficult to see happening.* * * * *I was working up a pretty good case of the ass over reporters hijacking Barack Obama's news conference on health-care reform yesterday because one Illinois politician with a small-dick complex was more important than nearly 50 million Americans who have no health insurance, a number that is sure to spike in 2009.
But then I realized that the president-elect didn't really have anything concrete to say other than he's on the case.
So coming from someone who is tired of talking about reform and champing at the bit to deal with it, concrete this: There is no better stimulus to the economy than health-care reform, something that the president-elect did allude to. He also needs to invite the enemies of reform -- Big Pharma, insurance giants and for-profit hospital chains -- to the table and make it clear that changes are coming because the biggest drag on the system are inflated costs and waste, which are these group's oxygen.
The one bit of immediate good news is that the reform effort will be headed up by Tom Daschle and Jeanne Lambrew, who unlike Hillary Clinton, who engineered the 1993 reform debacle, have their heads screwed on right. And (gasp!) are unapologetic advocates of social justice.* * * * *There are economic statistics and then there are economic statistics.
They all suck these days, but this one jumped off the page at me: Household net worth -- that is, the difference between the value of assets and liabilities -- was an estimated $56.5 trillion at the end of the third quarter of 2008, $2.8 trillion dollars less than in the preceding quarter.* * * * *The canard that colored people (or people of color, to be politically correct) are responsible for the foreclosure epidemic and therefore the financial crisis is going to die a slow death. This is because congressional Republicans (you know, roughly one-half of that aforementioned bipartisan thing) are doing everything they can short or mouth-to-mouth resuscitation to keep it alive.
The reason is obvious: George Bush and Republicans don't like colored people. Democrats not only like colored people, according to the Republican mantra they got Fannie and Freddie to go to bed with them and you know . . . do the wild thing in the form of subprime mortgages as dictated by that piece of socialist treachery, the Community Reinvestment Act.
Now Ben Bernanke may be a spendthrift idiot, but even he says the CRA didn't have jack to do with the mess we're in.
Top illustrations by Edward Sorel