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The only thing that would actually work to fix this problem is the thing Obama and the Dems are not going to do. What really needs to be done is to lower income taxes (if not get rid of them) as well as the corporate tax rate; it's too high. Massive government spending will not fix this and nor will raising the taxes on the so-called rich.
Some of us in the middle class are very suspicious of a beneficent federal government that somehow knows how to run the economy better than business and certainly knows how to spend money better than I do. I don't want another New Deal.
I think that many people may be experiencing the same awakening that you describe in yourself and it may also be integral to the process of revolution which has been going on across the centuries.
and KoB, you are right: the Middle Classes are hurting.
Some years ago, on other boards than this, I was roundly abused for saying that the Age of Revolutions is still with us and that the US is still in revolutionary mode. I concluded that there continued to exist the risk, evinced by the French, Russian and Chinese experience among others, of military dictatorship.
That particular risk may be receding but the basic moving force of every modern revolution is still present: a dissatisfied middle class. Whether we consider the Englsih revolutions of 1645 and 1688, the American in 1776, the French (1789), the Russian (1917) and so on, the initial disruption arises within the literate middle class reacting to pressure that has become too uncomfortable. The process is always the same:
The middle classes always resent taxation but put up with it 'for the general good'. There comes a point, however, where the resentment overcomes the middle class habit of obedience. Complaining voices rise above the general chatter and the grievances become expressed and clarified. Because this expression of dissent has arisen, in the past, among the literate, it has has started with some degree of moderation. Old habits die hard.
As the middle classes become more aware of their discomfort and achieve a language in which to express it, they demand a say in how the pressure is to be regulated: "No taxes without representation" is one such demand, also government drawn from wider and wider groups of people.
In some ways, this is precisely the pattern of the barons' rebellion that brought about Magna Carta, with the barons as 'middle classes'.
The risk is that the middle class discontent becomes translated into violence, which erupts among the disinherited.
That all sounds good, but it misses the essential point that the current economic disaster we're entering has little to do with the level of taxation in the US. What it has to do with is the feeding frenzy of the capitalists facilitated and encouraged by the Republican party. They seriously sold the rest of us (i.e., the middle and lower classes, if you insist on talking about classes - how British!) down the road with not a care about our well-being. The sooner the Republicans wake up to the fact that they are the problem rather than the solution, the sooner we'll be able to move on and straighten out this mess, if it is even possible to do so after the incredible mess they've made. As one of the commentators noted in the New York Times recently, the GOP caucus in Congress must be meeting in a soundproof room. That's how out of touch they are.
Yes, we are still in the Age of Revolution, and we just had one. Those who don't get on board are going to be left in the dustbin of history.
I'm not sure if the Democrats can claim that they have not had their snouts in the pork, Palzang. I do agree that one of the major contributory factors to the current crisis has been greed which has not simply been unrestrained but actually promoted as good for the economy. The availability of cheap credit to poor risk borrowers is only a symptom of the unbounded and unfounded optimism in 'the Market'.
Another crucial factor is that we have been spending money like water in pursuance of war in several theatres at once. This cost is not being discussed. I am sure that the Joint Chiefs and the UK General Staff are delighted to have the bankers to blame.
As for the notion of class being somehow 'British', it was one of your fellow-countryman (KoB) who brought up the notion. That having been said, it is a useful shorthand to describe demographic stratification which is at least as divisive and corrupting in the US as in the UK. You may have a rather smaller percentage of old families who thyink themselves superior but the spectrum from your super-rich to the indigent poor needs some form segmentation. 'Class' is no more than a useful categorisation.
I find it fascinating that, in India, the dalits escape from the caste system when they Take Refuge. No such escape exists for Westerners, whose category/class is so often posited on the family's economic position.
I do agree that one of the major contributory factors to the current crisis has been greed which has not simply been unrestrained but actually promoted as good for the economy.
Very true. The notion of being satisfied with what you need is seen as distinctly unambitious and ultimately detrimental. Spending beyond ones means to acquire high status homes, cars etc. is praised, as it boosts the economy.
The only problem is, pumping credit into the system only causes price rises, especially with property, so everyone is obliged to dig deep to get on the housing ladder, still saddled with student debt.
Well, that bubble's burst now. Someone should have told them what happened to the economy of the Spanish Empire after the Conquistadors brought boat loads of gold back home from the new world.
I'm not suggesting that the Democrats are free of taint. They're just politicians and by their very nature thieves as well. However, all one has to do is look at the record. Bill Clinton left a surplus. W left a staggering trillion dollar deficit. How could that change so quickly? Greed. Greed run rampant and facilitated in every way possible by a corrupt administration that had only the well-being of its friends in mind. The message of the last election is clear: the status quo is no longer an option. Those who attempt to hold on to their pathetic little power bases are doomed to be run over by the steamroller of change. If the Democrats can't do it either, then they will also go by the wayside.
The only thing is, don't try to spread the butter on one piece of toast. The economic policies tend to have an effect well into the term of the next president. In fact, one article I read in "Baron's" said that often we need to look a decade back to see where many of our economic trends came from. Don't get me wrong, there are many things in the here and now that have an effect on the economy now, but, there were also trade agreements from the Clinton era that have a major impact on today's econom.
The only thing is, don't try to spread the butter on one piece of toast. The economic policies tend to have an effect well into the term of the next president. In fact, one article I read in "Baron's" said that often we need to look a decade back to see where many of our economic trends came from. Don't get me wrong, there are many things in the here and now that have an effect on the economy now, but, there were also trade agreements from the Clinton era that have a major impact on today's econom.
You may not be surprised that I suggest an even longer view, Bushi. The past 230 years of the Republic have contained a number of politico/economic events which are still having unresolved effects. It can, I think, be argued that the US has still not fully recovered from the catastrophe of the Civil War, the collapse of a slave-based economy and the reliance on war production.
Of course, I maintain that we haven't yet fully assimilated the fall of the Roman Empire - so what do I know?
Of course, I maintain that we haven't yet fully assimilated the fall of the Roman Empire - so what do I know?
That's still too recent! What about the extinction of the Wooly Mammoths we can no longer hunt? Now that was a crisis and MacDonalds hasn't proved itself to be a satisfactory solution.:D
The only thing that would actually work to fix this problem is the thing Obama and the Dems are not going to do. What really needs to be done is to lower income taxes (if not get rid of them) as well as the corporate tax rate; it's too high. Massive government spending will not fix this and nor will raising the taxes on the so-called rich.
Well, one way to lower income tax is to institute a transaction tax on most financial-market transactions. For all of the arguments against this tax policy (e.g., A Transaction Tax to Reduce Liquidity on U.S. Markets? Terrible Idea), I think that it has a lot of potential as long as the percentage rate is small enough to keep our market attractive to investors.
I am certainly no expert when it comes to our tax system, but I agree with Ralph Nader 100% that we should tax the speculators on Wall Street. Considering that we as a nation are faced with a gigantic deficit, a deepening recession and tax cuts that will further limit revenue on both the state and federal level, I think that it is a step in the right direction.
Not only have Wall Street speculators done their fair share to get us in this mess, but a transaction tax would go a long way toward helping Wall Street pay for its own bailout. It seems more than fair to institute a suggested tax of 0.25% on a stock trade or 0.02% on the purchase of credit default swap when most people in the United States have to pay anywhere from 5% to 8% sales tax on whatever they buy.
I am surprised that there has not been more discussion on this issue seeing as how this modest tax proposal would not only generate more revenue and discourage rampant speculation, but according to economist Dean Baker, a modest financial transactions tax would "easily raise an amount equal to 1% of GDP" and potentially "finance a 10% across-the-board reduction in the income tax." Wouldn't that be nice?
That is why I urge anyone who feels the same to lobby their member of Congress to support this proposed tax policy. I know that the subject of new taxes is not a popular topic of conversation these days, but in drastic economic times such as this, something has to be done to help raise more revenue, curb speculation and, more important, stabilize the market. Plus, I think it is time that someone besides the American tax-payer is asked to help shoulder this burden.
This particular tax policy was most famously endorsed by economist John Maynard Keynes who, in The General Theory Employment, Interest and Money, suggested that the "introduction of a substantial Government transfer tax on all transactions might prove the most serviceable reform available, with a view to mitigating the predominance of speculation over enterprise in the United States" (160).
I tend to listen to Silverberg regarding these bailouts. In the long run, entrepreneurship will likely prove more beneficial and productive than trying to keep alive the kinds of enterprises that served the needs of the Cold War. I also agree with Clement the industry minister. The fact is that before we start to spend taxpayers money, there are Canadian-specific details that we still need to see from Chrysler.
Richard Wolf of the New School does point out some interesting trends, but I think what he's addressing has more to do with how our economy has fundamentally changed with the job market becoming a buyer's market (the employer's) and the worker becoming more and more expendable. His is a good argument for why our standard of living is going down, but does not address the burst bubble caused by all that rampant overspeculation.
Anyone that calls the 39 years since 1970 thirty years would also say that something that costs $999.99 is 900 dollars, rather than 1000.
I very much doubt that his next installment, on unionization, will reveal anything about this economic crisis. This stuff, though interesting, is quite beside the point. The financial world went crazy with greed, built all these strange derivatives and flying kite-mansions, and then was allowed to sell them to people who were hoodwinked into believing that these mansions could stay suspended in the air. What is left to us now is to look around and try to pick up the pieces of all those broken dreams, pull ourselves up by our wits, and try to learn that money doesn't make the world go 'round afterall.
What makes the world go round is time and opportunity, not our heaping up all our hopes in just a few odd bank piles.
There was an interesting article in the Sunday edition of the Detroit Free Press regarding the idea of temporarily nationalizing U.S. banks. It seems that even the champion of free market capitalism, Alan Greenspan, thinks that it may be necessary. This should be one hell of a wake-up call to everyone who thinks that the financial market will be able to fix itself this time:
WASHINGTON -- Former Federal Reserve Chairman Alan Greenspan thinks it's necessary. His successor, Ben Bernanke, doesn't rule it out. From editorial pages to the blogosphere to boardrooms, this is the question on many minds: Should the United States nationalize some banks?
A few months ago, it would have been heretical to suggest that Bank of America could become Bank Owned by America.
Now, however, the U.S. economy is sinking faster than anyone thought possible, and respected economic authorities are suggesting that temporary bank nationalization could be the best solution.
Views of Greenspan, Bernanke
"It may be necessary to temporarily nationalize some banks in order to facilitate a swift and orderly restructuring," Greenspan, the long-revered sage of free-market theory, told London's Financial Times in an interview published Wednesday. "I understand that once in a hundred years this is what you do."
When Bernanke was asked whether he shared his predecessor's views, he didn't distance himself from them during a question session Wednesday at the National Press Club. He answered as if nationalization were inevitable -- after first listing some of the problems it would entail.
"Well, I think as a general rule, it's very challenging for governments to manage banks for a protracted period. And there's the additional problem that if you have a government-run institution, that you tend to lose the franchise value," Bernanke said.
"So I think whatever actions may need to be taken at one point or another, I think there's a very strong commitment on the part of the administration to try to return banks or keep banks private or return them to private hands as quickly as possible."
The term "nationalization" conjures images of the communist Soviet Union or corrupt Latin American dictatorships, but advocates of nationalizing U.S. banks envision a seizure of big banks on the grounds that they already are insolvent except for some accounting sleight of hand.
Banks are sitting on trillions of dollars worth of complex securities, backed by U.S. mortgages that are going into default as more homes are now worth less than the mortgages on them.
If banks were forced to put present-day values on these securities instead of hold-to-maturity values, their liabilities would far exceed their assets. They would be insolvent.
Seizure, surgery, sale
What's needed, nationalization advocates argue, is for the government to seize Bank of America, Wells Fargo, Citigroup and other large banks, carve out their bad assets, then break them into smaller pieces for quick sale to the private sector.
"Nationalization is the only option that would permit us to solve the problem of toxic assets in an orderly fashion and finally allow lending to resume," Nouriel Roubini, a prominent New York University economist, wrote in an opinion piece Feb. 15 in the Washington Post. "Of course, the economy would still stink, but the death spiral we are in would end."
Other analysts think that nationalization is all but inevitable.
"It's very hard when you get to this point not to do that," said Adam Posen, the deputy director of the Peterson Institute for International Economics, a free-market research center.
Posen said he thinks that nationalization is losing its stigma, and he envisions scenarios in which the government could seize the nation's 50 largest banks.
It's inescapable, some say
Most depositors would be safe, since their deposits are insured up to $250,000. Stockholders probably would be wiped out, and bondholders eventually would get shares of any new company.
The government could even make money on some seizures, if history is any guide.
Roubini and Posen said they think that a bold, drastic step is inescapable, and that a failure to take it now would only make it costlier and more difficult later.
Today's problem is the $1.2 trillion in assets whose underlying collateral is shoddy subprime mortgages, which have eroded faith in the broader U.S. housing market. For now, the Obama administration is mum on nationalization.
Whilst the arguments for bank nationalisation become stronger and stronger, finally convincing even the hierophants of the marketplace (although always understood by other 'faith families', like socialists), I notice that they comfort themselves with the word "temporary".
I recall that Income Tax was a temporary measure!
Sub specie aeternitatis, of course, banking or, even, taxation, are temporary - as are you and I.
This Richard Wolf of the New School is beginning to make sense now. Too bad the interview had to be truncated. Very interesting stuff. Thanks, Ragyaba, for bringing this to our attention!
(No comment on the unreadable Mogambo gulash, though.)
I don't want the banks to be nationalized for two reasons. One, I have an awful suspicion that it will be as temporary as the income tax, and two, I own hundreds of shares in bank stocks. As I have heard increasing rumblings about nationalization, my stocks have taken a beating.
Also, I don't have an ounce of sympathy for these people who are having mortgage trouble. That's your own fault if you got in over your head. Bad planning on your part trying to pay for a house that you couldn't possibly afford. Equally stupid are the banks that actually did give out these bad loans.
What worries me about this whole recession, is that it originally started with a slumping housing crisis and how to fix that, and now it's turned into the biggest spending spree in history as we try to "reshape" this entire country to everything from cars to health care.
I don't want the banks to be nationalized for two reasons. One, I have an awful suspicion that it will be as temporary as the income tax, and two, I own hundreds of shares in bank stocks. As I have heard increasing rumblings about nationalization, my stocks have taken a beating.
Well, there are certainly many arguments against the nationalization of failing major banks. One of them is the argument that such a "temporary" measure might become permanent. I suppose it is possible, but it is just as possible that it will be like the nationalization of the railroads during WW II, which were returned to private ownership immediately after the war, or what Roosevelt did in the 30s, or like what happened with the savings and loan crisis, etc.
The second argument, that the "increasing rumblings about nationalization" are hurting stocks, well, the increasing rumblings and growing concerns about the insolvency and failure of these institutions will also do that. Looks like your screwed either way.
Also, I don't have an ounce of sympathy for these people who are having mortgage trouble. That's your own fault if you got in over your head. Bad planning on your part trying to pay for a house that you couldn't possibly afford. Equally stupid are the banks that actually did give out these bad loans.
I think that is a gross over-simplification of the mortgage problem. Sure, some people are guilty of bad planning and have no one to blame but themselves; however, some of the people who are in over their heads are victims of predatory lending.
My mom, for example, was suckered into an adjustable rate mortgage that nearly cost my parents their home. While recovering from a life-threatening illness, of which she was in and out of consciousness for over a month, my mom was talked into an ARM.
I never knew it even happened. I think she was looking into remortgaging the house to help with the medical bills. She was still in the process of recovery, though, and she was not completely clear-headed at the time. When the rates became astronomical and they could no longer afford their monthly payments, she finally confessed that she had been talked into an ARM. She was too ashamed and embarrassed to admit what had happened sooner. She was eventually able to get a fixed rate mortgage with another company, but a lot of other people are not so lucky.
Personally, I have a great deal of sympathy for people like my mother — people who were tricked into obscene mortgages that they did not understand just so that some loan officers could get a hefty commission and the banks or mortgage companies they worked for could claim them as assets to bolster their books before dumping them onto someone else — because I have been faced with my family losing everything due to someone else's greed.
What worries me about this whole recession, is that it originally started with a slumping housing crisis and how to fix that, and now it's turned into the biggest spending spree in history as we try to "reshape" this entire country to everything from cars to health care.
In my opinion, this country needed to be reshaped a long time ago. Nevertheless, I am also worried about all of this new spending, and there is no telling if it will actually help in the long run.
If the economy recovers, someone will argue that the stimulus worked while another will just as convincingly argue that it would have recovered faster without it; if the economy gets worse, someone will argue that the stimulus failed while another will argue just as forcefully that it would have been much worse without it.
Also, I don't have an ounce of sympathy for these people who are having mortgage trouble. That's your own fault if you got in over your head. Bad planning on your part trying to pay for a house that you couldn't possibly afford. Equally stupid are the banks that actually did give out these bad loans...
KOB, I think Jason is right in saying that you're lumping too many people and situations in too narrow terms and, thereby, misrepresent a lot of the reality on the ground.
I believe that you are just angry at what's happened and not really lacking in the compassion that you claim you are. Of course you're angry at all the reckless irresponsible behavior of the providers and "experts" in the financial industries that rated so highly the bad ideas and questionable financial instruments of the day. You're young and thought you had a "life" ahead of you, and they've blackened your horizons.
However, anger should be aimed at the profiteers, not at the hoodwinked.
I say let the bogus banks all fail and shore up the credit unions, which are faring well. But peace and joy to all sentient beings everywhere!
I believe that you are just angry at what's happened and not really lacking in the compassion that you claim you are. Of course you're angry at all the reckless irresponsible behavior of the providers and "experts" in the financial industries that rated so highly the bad ideas and questionable financial instruments of the day. You're young and thought you had a "life" ahead of you, and they've blackened your horizons.
However, anger should be aimed at the profiteers, not at the hoodwinked.
I say let the bogus banks all fail and shore up the credit unions, which are faring well. But peace and joy to all sentient beings everywhere!
I'm all for people having peace and joy as long as I don't have to pay for them to have it.
Look, I tend to lean very libertarian on economics. If two parties sign a contract (bank and person taking out loan), and that contract is legal, then they should both be obligated to make due on it. To say that people were hoodwinked is true enough, but isn't there any responsibility to people who are hoodwinked? If I fall for every get-rich, make money fast scheme, who is ultimately to blame for that?
I am very wary of the idea of fixing X's mistakes by using Y's money when X is to blame for it.
Look, I tend to lean very libertarian on economics. If two parties sign a contract (bank and person taking out loan), and that contract is legal, then they should both be obligated to make due on it. To say that people were hoodwinked is true enough, but isn't there any responsibility to people who are hoodwinked? If I fall for every get-rich, make money fast scheme, who is ultimately to blame for that?
That is certainly understandable, KoB, but are you saying that you oppose any system dedicated to protecting consumers from unfair or deceptive marketplace practices? What do you suggest happen to victims of unfair or deceptive marketplace practices, nothing? What about to deceptive lenders, nothing? Looking at it from this perspective, I wonder how stable the market would look if it was simply a no holds barred competition for profit.
That is certainly understandable, KoB, but are you saying that you oppose any system dedicated to protecting consumers from unfair or deceptive marketplace practices? What do you suggest happen to victims of unfair or deceptive marketplace practices, nothing? What about to deceptive lenders, nothing? Looking at it from this perspective, I wonder how stable the market would look if it was simply a no holds barred competition for profit.
Isn't this precisely what results from an Adam Smith approach which leaves the 'marketplace' free to find its own level. The only brake is caveat emptor. In that context, why prosecute Bernard Madoff? OK he lied but he was only using the market and people's greed. Same goes for Enron.
But, of course, the counter-argument is that 'some' regulation is OK - with enormous disagreement over what is meant by 'some'.
It is interesting to note that making money from money, i.e. earning interest, is deemed sinful by both Tanakh Judaism and Islam. In both cases, the argument is that money is not a crop which can grow naturally.
When I am in conversation with those of my friends who cling to reductionist materialism, I find much the same attitude as expressed by you, KoB - until they are, themselves, out of work, mortgage foreclosed and with all their savings lost. Then they begin to understand that a society without safety nets for casualties is no better than a cage of wild animals.
The Dalai Lama reminds us that there is real utilitarian interest in caring for the poor and disinherited: we may need help ourselves one day!
This particular tax policy was most famously endorsed by economist John Maynard Keynes who, in The General Theory Employment, Interest and Money, suggested that the "introduction of a substantial Government transfer tax on all transactions might prove the most serviceable reform available, with a view to mitigating the predominance of speculation over enterprise in the United States" (160).
Well I prefer the school of thought from Jefferson and Hayek that ultimately believes in a more limited government. Ultimately a classical liberal stance.
When have Keynes' policies ever worked? When has unbridled spending ever created prosperity in the United States? I mean we're even surpassing the Europeans now; Sweden is refusing to bail out its failing auto industries but we are.
The solution from Keynesian supporters always involves higher taxes on someone or more spending in general. But taking away more of peoples' legally earned money is hardly the way to success. That's why I'm in favor of the Fair Tax plan because it means you are only taxed on what you buy, and not on what you earn.
As an Australian, what I see of your federal government appears to be each man for himself and his vested interest. Is this the case?
Here in Australia, each political party generally come to their own consensus before decisions are made.
But in USA news reports, I see this congressman from this party or this one from another party raising their own issues, often against their own party.
Or I hear about Acts of govt being passed without the senate & congressmen even reading the documents.
We had no major financial issues here because the banks are heavily regulated (but still make plenty of profit for the shareholers). I think regulated capitalism is the best.
Is it true Obama has broken his promise to support the reintroduction of the Glass-Steagall Act?
We are being asked to believe that pouring money in at the 'top' of the system will prime the pump, but giving money to the already rich doesn't encourage spending. Give money to the poor and they have to spend - and the result is that the economic system, the 'real' economy, begins to move.
1) Capitalism is an economic system that, by default, then underpins our political system: Why, then just because we are in crisis, do we pretend that all along we thought it was a system of morality?
2) Just because something messes up, it doesn't mean it should be thrown away. What system, person or belief is completely infallible, infinitely simple to apply and always comes up with the goods, in all respects? I agree with the member who posted that it's not capitalism per se - it's greed that got us here.
3) Lastly, we are reacting as though basic human nature has been somehow exorcised out of us and are interpreting everything through the lenses of society and 'the system'. I have a Hobbesian view of human nature and therefore am not as surprised by the crisis as some make out they are. I think that, rather than giving floundering economists even more air time to say why they didn't see it coming and how long it'll last, could we not go back to our philosophy text books?
The world has seen all of the elements of this crisis many, many times before. Let us learn from those who set up the first 'societies', political and trading systems and stop pretending we know it all and the answers lie in the hi-tech future.
We blatently have a whole lot to learn from lessons already lived by our forefathers.
1) Capitalism is an economic system that, by default, then underpins our political system: Why, then just because we are in crisis, do we pretend that all along we thought it was a system of morality?
I think this is partially due to Adam Smith, who basically had the idea that the selfish and unrestrained (i.e. free) pursuit of self-interest would improve the general welfare, with the basic idea being that private profit will translate into public benefit. And I suspect that many people simply assume that "general welfare" is synonymous with "morality."
2) Just because something messes up, it doesn't mean it should be thrown away. What system, person or belief is completely infallible, infinitely simple to apply and always comes up with the goods, in all respects? I agree with the member who posted that it's not capitalism per se - it's greed that got us here.
Of course there's nothing wrong with trying to improve how capitalism functions, but one of the main problems that people have with the capitalist system itself is that it's driven by greed. The very premise is behind it, as I've already said, is that the selfish and unrestrained pursuit of self-interest is a good thing. Therefore, capitalism itself often fosters greed in the way that it's structured, especially considering the fact that profit is the bottom line.
That doesn't mean that we should just throw it away, but some people simply feel that it's time to give another system a try, one that takes the needs of people into consideration more than the potential for profit. For example, we have dozens of brands of bottled water to choose from in our local grocery stores while almost 2 million people die every year from waterborne diseases and 1 billion lack proper drinking water (U.S. Centers for Disease Control and Prevention).
Of course, as I said in my original post, no system is perfect, but that doesn't mean we can't explore other options does it? I definitely think that capitalism has done a good job of getting us where we are, but maybe there's something better for where we'd like to be in the future (e.g., I Love Bill Moyers, but He's Wrong About Socialism).
3) Lastly, we are reacting as though basic human nature has been somehow exorcised out of us and are interpreting everything through the lenses of society and 'the system'. I have a Hobbesian view of human nature and therefore am not as surprised by the crisis as some make out they are. I think that, rather than giving floundering economists even more air time to say why they didn't see it coming and how long it'll last, could we not go back to our philosophy text books?
The world has seen all of the elements of this crisis many, many times before. Let us learn from those who set up the first 'societies', political and trading systems and stop pretending we know it all and the answers lie in the hi-tech future.
We blatently have a whole lot to learn from lessons already lived by our forefathers.
I completely agree, but I think that one of the problems is that we're often not taught these things in school, or anywhere else for that matter.
As a matter fo fact, I watched a documentary about Howard Zinn the other day, and he mentions that he learned about the Ludlow Massacre from a Woody Guthrie song because his history text books (even in graduate school, mind you) never mentioned it.
History, I'm beginning to realize, is one of the most important subjects there is.
Yes. Such a shame that depending on where you live, your social class, ethnic backround etc., etc., it's not the same history that's taught.
I was brought up in a multi-lingual, bi-cultural environment: more or less 'English' home but French school; 7 months/year in UK, rest in France. This meant that I learned two separate histories and two separate accounts of events where they intersected, e.g. was Waterloo a defeat or a victory? Who discovered calculus, Newton or Pascal? etc....?
It left me with deep doubt as to the interpretation and selectivity of historians and an acute awareness that they all have their own bias and agendas.
What you're talking about, Simon, is a meta-version of what we as individuals do all the time, filtering "reality" through our own filters and conditioned responses. I guess if we as individuals can't report honestly even to ourselves what we're experiencing, we can hardly expect historians and the news media to either!
This came home particularly a few weeks ago when I clicked on a news story about something, and it was on the Xinhua (Chinese) website. I don't even remember what the story was about, but I do remember they had a link to a video about the glorious "serf liberation" celebration in Lhasa. I felt like throwing up. "Serf liberation", wtf? But you know, we all do it.
Study without reflection is a waste
Reflection without study is a danger
And picking up on DD's post... What exactly is regulated capitalism? It sounds like a great system, I just wonder how it works in practice. What is the Australian economy like at the moment (we hear so little about it here in the UK)? What other countries can be said to have this system...?
The story is told about the transatlantic liner caught in a terrible storm. The Captain approached one of the passengers whose Roman collar denoted that he was a priest.
"Will you say some prayers for us, Father," the Captain asked.
"Good Lord!" The clergyman exclaimed, "Surely things aren't as bad as all that?"
**********
UK churches, synagogues, mosques and debt advisory bodies are filling up as people get more and more scared by the ongoing financial collapse and its effects on the ground in job losses, repossessions, family rows, depression, e tutti quanti.
The danger of this is that people will harden their hearts against 'the other', from the reflex to blame someone else. Value would come if these community centres helped us to recognise our own, personal responsibility for more than our own problem. We were quite happy (as a nun said today on Radio 4's Sunday programme) to pick up the crumbs from the rich people's tables: cheap credit, house price explosion, cheap food, cheap fuel.
We have an opportunity to reflect and take more skillful decisions for the future.
We are being asked to believe that pouring money in at the 'top' of the system will prime the pump, but giving money to the already rich doesn't encourage spending. Give money to the poor and they have to spend - and the result is that the economic system, the 'real' economy, begins to move.
Banks don't spend money, people do.
You use the phrase "pouring money" as if it were the government who was giving this group money and not giving another group money. I don't want the government giving anyone money. Not the rich, not the poor, not big businesses, not small businesses. I'm in favor of people keeping the money they make and not having some form of "mild theft" as John Stuart Mill called it.
If I work really hard, I don't think I deserve to get punished more by keeping a lesser percentage of the money I make. And I especially don't want that money stolen from me and given to someone who isn't working at all.
I don't understand the stigma against people making money. When a government says that someone makes too much money, it is clearly overstepping its rightful boundaries.
H'mmm. Looks like this thread has fallen on hard times lately.
But, hang on to your hats, guys and gals, as we get ready for Round Two of our continuing trip into the Age of Limits:
“... nstead of the dollar serving as the answer to risk aversion, it may serve as the cause. This is specially so if investors come to see the hard-asset oriented investments in the emerging economies as better stores of wealth than a rapidly declining dollar. As we shall see later in this article, the emerging economies are weathering this storm much better than is the US. At some point global investors may become sufficiently repulsed by the dollar's mounting troubles that they refuse to give it the nod as a safe haven in any new storm.”
“Clearly, a new era of cutthroat energy competition is on us ... The global energy equation is changing rapidly, and with it is likely to come great power competition, economic peril, rising starvation, growing unrest, environmental disaster, and shrinking energy supplies, no matter what steps are taken ... [T]he new trends in energy on the planet are already increasingly evident - and unsettling.
It's interesting that the talk recently (and I'm a load less interested in the news since this crisis!) hinges on... Well what the bankers etc did wasn't illegal. They took risks like all financial institutions do. What the MPs have done isn't illegal... They made the most of the system.
But when are we going to stop talking about money and prison and accountability and fat cats... and start talking about how wrong it is to make it your life's work to put so much bad energy about... just because you can.
"The challenge to economics at this point is raising the consumption levels of the global poor with minimal disruption of the environment, while radically cutting back on environmentally damaging consumption or over consumption in the North."
Comments
Some of us in the middle class are very suspicious of a beneficent federal government that somehow knows how to run the economy better than business and certainly knows how to spend money better than I do. I don't want another New Deal.
Jason,
I think that many people may be experiencing the same awakening that you describe in yourself and it may also be integral to the process of revolution which has been going on across the centuries.
and KoB, you are right: the Middle Classes are hurting.
Some years ago, on other boards than this, I was roundly abused for saying that the Age of Revolutions is still with us and that the US is still in revolutionary mode. I concluded that there continued to exist the risk, evinced by the French, Russian and Chinese experience among others, of military dictatorship.
That particular risk may be receding but the basic moving force of every modern revolution is still present: a dissatisfied middle class. Whether we consider the Englsih revolutions of 1645 and 1688, the American in 1776, the French (1789), the Russian (1917) and so on, the initial disruption arises within the literate middle class reacting to pressure that has become too uncomfortable. The process is always the same:
The middle classes always resent taxation but put up with it 'for the general good'. There comes a point, however, where the resentment overcomes the middle class habit of obedience. Complaining voices rise above the general chatter and the grievances become expressed and clarified. Because this expression of dissent has arisen, in the past, among the literate, it has has started with some degree of moderation. Old habits die hard.
As the middle classes become more aware of their discomfort and achieve a language in which to express it, they demand a say in how the pressure is to be regulated: "No taxes without representation" is one such demand, also government drawn from wider and wider groups of people.
In some ways, this is precisely the pattern of the barons' rebellion that brought about Magna Carta, with the barons as 'middle classes'.
The risk is that the middle class discontent becomes translated into violence, which erupts among the disinherited.
Yes, we are still in the Age of Revolution, and we just had one. Those who don't get on board are going to be left in the dustbin of history.
Palzang
Another crucial factor is that we have been spending money like water in pursuance of war in several theatres at once. This cost is not being discussed. I am sure that the Joint Chiefs and the UK General Staff are delighted to have the bankers to blame.
As for the notion of class being somehow 'British', it was one of your fellow-countryman (KoB) who brought up the notion. That having been said, it is a useful shorthand to describe demographic stratification which is at least as divisive and corrupting in the US as in the UK. You may have a rather smaller percentage of old families who thyink themselves superior but the spectrum from your super-rich to the indigent poor needs some form segmentation. 'Class' is no more than a useful categorisation.
I find it fascinating that, in India, the dalits escape from the caste system when they Take Refuge. No such escape exists for Westerners, whose category/class is so often posited on the family's economic position.
Very true. The notion of being satisfied with what you need is seen as distinctly unambitious and ultimately detrimental. Spending beyond ones means to acquire high status homes, cars etc. is praised, as it boosts the economy.
The only problem is, pumping credit into the system only causes price rises, especially with property, so everyone is obliged to dig deep to get on the housing ladder, still saddled with student debt.
Well, that bubble's burst now. Someone should have told them what happened to the economy of the Spanish Empire after the Conquistadors brought boat loads of gold back home from the new world.
Palzang
You may not be surprised that I suggest an even longer view, Bushi. The past 230 years of the Republic have contained a number of politico/economic events which are still having unresolved effects. It can, I think, be argued that the US has still not fully recovered from the catastrophe of the Civil War, the collapse of a slave-based economy and the reliance on war production.
Of course, I maintain that we haven't yet fully assimilated the fall of the Roman Empire - so what do I know?
That's still too recent! What about the extinction of the Wooly Mammoths we can no longer hunt? Now that was a crisis and MacDonalds hasn't proved itself to be a satisfactory solution.:D
Well, one way to lower income tax is to institute a transaction tax on most financial-market transactions. For all of the arguments against this tax policy (e.g., A Transaction Tax to Reduce Liquidity on U.S. Markets? Terrible Idea), I think that it has a lot of potential as long as the percentage rate is small enough to keep our market attractive to investors.
I am certainly no expert when it comes to our tax system, but I agree with Ralph Nader 100% that we should tax the speculators on Wall Street. Considering that we as a nation are faced with a gigantic deficit, a deepening recession and tax cuts that will further limit revenue on both the state and federal level, I think that it is a step in the right direction.
Not only have Wall Street speculators done their fair share to get us in this mess, but a transaction tax would go a long way toward helping Wall Street pay for its own bailout. It seems more than fair to institute a suggested tax of 0.25% on a stock trade or 0.02% on the purchase of credit default swap when most people in the United States have to pay anywhere from 5% to 8% sales tax on whatever they buy.
I am surprised that there has not been more discussion on this issue seeing as how this modest tax proposal would not only generate more revenue and discourage rampant speculation, but according to economist Dean Baker, a modest financial transactions tax would "easily raise an amount equal to 1% of GDP" and potentially "finance a 10% across-the-board reduction in the income tax." Wouldn't that be nice?
That is why I urge anyone who feels the same to lobby their member of Congress to support this proposed tax policy. I know that the subject of new taxes is not a popular topic of conversation these days, but in drastic economic times such as this, something has to be done to help raise more revenue, curb speculation and, more important, stabilize the market. Plus, I think it is time that someone besides the American tax-payer is asked to help shoulder this burden.
http://www.pbs.org/wgbh/pages/frontline/heat/view/
[“Heat” provides a necessary background to the economic crisis]
http://www.pbs.org/wgbh/pages/frontline/meltdown/view/
Interesting to compare:
http://atimes.com/atimes/Global_Economy/KB18Dj05.html
http://blog.atimes.net/?p=601
[Personally, I think Goldman is more accurate]
--Other stuff that's at least half-ways important:
http://www.nytimes.com/2009/02/15/business/15global.html?pagewanted=2&ref=business
http://atimes.com/atimes/Global_Economy/KB21Dj01.html
http://www.nytimes.com/reuters/2009/02/20/business/business-us-financial-soros.html
Pay attention to the green shift.
http://therealnews.com/t/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=3344&updaterx=2009-02-26+17%3A38%3A44
Anyone that calls the 39 years since 1970 thirty years would also say that something that costs $999.99 is 900 dollars, rather than 1000.
I very much doubt that his next installment, on unionization, will reveal anything about this economic crisis. This stuff, though interesting, is quite beside the point. The financial world went crazy with greed, built all these strange derivatives and flying kite-mansions, and then was allowed to sell them to people who were hoodwinked into believing that these mansions could stay suspended in the air. What is left to us now is to look around and try to pick up the pieces of all those broken dreams, pull ourselves up by our wits, and try to learn that money doesn't make the world go 'round afterall.
What makes the world go round is time and opportunity, not our heaping up all our hopes in just a few odd bank piles.
A few months ago, it would have been heretical to suggest that Bank of America could become Bank Owned by America.
Now, however, the U.S. economy is sinking faster than anyone thought possible, and respected economic authorities are suggesting that temporary bank nationalization could be the best solution.
Views of Greenspan, Bernanke
"It may be necessary to temporarily nationalize some banks in order to facilitate a swift and orderly restructuring," Greenspan, the long-revered sage of free-market theory, told London's Financial Times in an interview published Wednesday. "I understand that once in a hundred years this is what you do."
When Bernanke was asked whether he shared his predecessor's views, he didn't distance himself from them during a question session Wednesday at the National Press Club. He answered as if nationalization were inevitable -- after first listing some of the problems it would entail.
"Well, I think as a general rule, it's very challenging for governments to manage banks for a protracted period. And there's the additional problem that if you have a government-run institution, that you tend to lose the franchise value," Bernanke said.
"So I think whatever actions may need to be taken at one point or another, I think there's a very strong commitment on the part of the administration to try to return banks or keep banks private or return them to private hands as quickly as possible."
The term "nationalization" conjures images of the communist Soviet Union or corrupt Latin American dictatorships, but advocates of nationalizing U.S. banks envision a seizure of big banks on the grounds that they already are insolvent except for some accounting sleight of hand.
Banks are sitting on trillions of dollars worth of complex securities, backed by U.S. mortgages that are going into default as more homes are now worth less than the mortgages on them.
If banks were forced to put present-day values on these securities instead of hold-to-maturity values, their liabilities would far exceed their assets. They would be insolvent.
Seizure, surgery, sale
What's needed, nationalization advocates argue, is for the government to seize Bank of America, Wells Fargo, Citigroup and other large banks, carve out their bad assets, then break them into smaller pieces for quick sale to the private sector.
"Nationalization is the only option that would permit us to solve the problem of toxic assets in an orderly fashion and finally allow lending to resume," Nouriel Roubini, a prominent New York University economist, wrote in an opinion piece Feb. 15 in the Washington Post. "Of course, the economy would still stink, but the death spiral we are in would end."
Other analysts think that nationalization is all but inevitable.
"It's very hard when you get to this point not to do that," said Adam Posen, the deputy director of the Peterson Institute for International Economics, a free-market research center.
Posen said he thinks that nationalization is losing its stigma, and he envisions scenarios in which the government could seize the nation's 50 largest banks.
It's inescapable, some say
Most depositors would be safe, since their deposits are insured up to $250,000. Stockholders probably would be wiped out, and bondholders eventually would get shares of any new company.
The government could even make money on some seizures, if history is any guide.
Roubini and Posen said they think that a bold, drastic step is inescapable, and that a failure to take it now would only make it costlier and more difficult later.
Today's problem is the $1.2 trillion in assets whose underlying collateral is shoddy subprime mortgages, which have eroded faith in the broader U.S. housing market. For now, the Obama administration is mum on nationalization.
I recall that Income Tax was a temporary measure!
Sub specie aeternitatis, of course, banking or, even, taxation, are temporary - as are you and I.
http://atimes.com/atimes/Global_Economy/KB28Dj01.html
Part 2 of Wolff is up [House of Credit Cards]:
http://therealnews.com/t/index.php?option=com_content&task=view&id=33&Itemid=74&jumival=333
This Richard Wolf of the New School is beginning to make sense now. Too bad the interview had to be truncated. Very interesting stuff. Thanks, Ragyaba, for bringing this to our attention!
(No comment on the unreadable Mogambo gulash, though.)
Also, I don't have an ounce of sympathy for these people who are having mortgage trouble. That's your own fault if you got in over your head. Bad planning on your part trying to pay for a house that you couldn't possibly afford. Equally stupid are the banks that actually did give out these bad loans.
What worries me about this whole recession, is that it originally started with a slumping housing crisis and how to fix that, and now it's turned into the biggest spending spree in history as we try to "reshape" this entire country to everything from cars to health care.
Well, there are certainly many arguments against the nationalization of failing major banks. One of them is the argument that such a "temporary" measure might become permanent. I suppose it is possible, but it is just as possible that it will be like the nationalization of the railroads during WW II, which were returned to private ownership immediately after the war, or what Roosevelt did in the 30s, or like what happened with the savings and loan crisis, etc.
The second argument, that the "increasing rumblings about nationalization" are hurting stocks, well, the increasing rumblings and growing concerns about the insolvency and failure of these institutions will also do that. Looks like your screwed either way.
I think that is a gross over-simplification of the mortgage problem. Sure, some people are guilty of bad planning and have no one to blame but themselves; however, some of the people who are in over their heads are victims of predatory lending.
My mom, for example, was suckered into an adjustable rate mortgage that nearly cost my parents their home. While recovering from a life-threatening illness, of which she was in and out of consciousness for over a month, my mom was talked into an ARM.
I never knew it even happened. I think she was looking into remortgaging the house to help with the medical bills. She was still in the process of recovery, though, and she was not completely clear-headed at the time. When the rates became astronomical and they could no longer afford their monthly payments, she finally confessed that she had been talked into an ARM. She was too ashamed and embarrassed to admit what had happened sooner. She was eventually able to get a fixed rate mortgage with another company, but a lot of other people are not so lucky.
Personally, I have a great deal of sympathy for people like my mother — people who were tricked into obscene mortgages that they did not understand just so that some loan officers could get a hefty commission and the banks or mortgage companies they worked for could claim them as assets to bolster their books before dumping them onto someone else — because I have been faced with my family losing everything due to someone else's greed.
In my opinion, this country needed to be reshaped a long time ago. Nevertheless, I am also worried about all of this new spending, and there is no telling if it will actually help in the long run.
If the economy recovers, someone will argue that the stimulus worked while another will just as convincingly argue that it would have recovered faster without it; if the economy gets worse, someone will argue that the stimulus failed while another will argue just as forcefully that it would have been much worse without it.
Jason
http://blog.atimes.net/?p=727
And I could be wrong, but I think that the bulk of the fecal matter has yet to reach the rotating air-movement device:
http://atimes.com/atimes/Global_Economy/KC14Dj04.html
http://atimes.com/atimes/China_Business/KC17Cb02.html
KOB, I think Jason is right in saying that you're lumping too many people and situations in too narrow terms and, thereby, misrepresent a lot of the reality on the ground.
I believe that you are just angry at what's happened and not really lacking in the compassion that you claim you are. Of course you're angry at all the reckless irresponsible behavior of the providers and "experts" in the financial industries that rated so highly the bad ideas and questionable financial instruments of the day. You're young and thought you had a "life" ahead of you, and they've blackened your horizons.
However, anger should be aimed at the profiteers, not at the hoodwinked.
I say let the bogus banks all fail and shore up the credit unions, which are faring well. But peace and joy to all sentient beings everywhere!
http://atimes.com/atimes/China_Business/KC18Cb01.html
I'm all for people having peace and joy as long as I don't have to pay for them to have it.
Look, I tend to lean very libertarian on economics. If two parties sign a contract (bank and person taking out loan), and that contract is legal, then they should both be obligated to make due on it. To say that people were hoodwinked is true enough, but isn't there any responsibility to people who are hoodwinked? If I fall for every get-rich, make money fast scheme, who is ultimately to blame for that?
I am very wary of the idea of fixing X's mistakes by using Y's money when X is to blame for it.
That is certainly understandable, KoB, but are you saying that you oppose any system dedicated to protecting consumers from unfair or deceptive marketplace practices? What do you suggest happen to victims of unfair or deceptive marketplace practices, nothing? What about to deceptive lenders, nothing? Looking at it from this perspective, I wonder how stable the market would look if it was simply a no holds barred competition for profit.
Isn't this precisely what results from an Adam Smith approach which leaves the 'marketplace' free to find its own level. The only brake is caveat emptor. In that context, why prosecute Bernard Madoff? OK he lied but he was only using the market and people's greed. Same goes for Enron.
But, of course, the counter-argument is that 'some' regulation is OK - with enormous disagreement over what is meant by 'some'.
It is interesting to note that making money from money, i.e. earning interest, is deemed sinful by both Tanakh Judaism and Islam. In both cases, the argument is that money is not a crop which can grow naturally.
When I am in conversation with those of my friends who cling to reductionist materialism, I find much the same attitude as expressed by you, KoB - until they are, themselves, out of work, mortgage foreclosed and with all their savings lost. Then they begin to understand that a society without safety nets for casualties is no better than a cage of wild animals.
The Dalai Lama reminds us that there is real utilitarian interest in caring for the poor and disinherited: we may need help ourselves one day!
Link to Wolff:
http://therealnews.com/t/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=3420
Link to Stroupe:
http://atimes.com/atimes/China_Business/KC18Cb01.html
http://www.atimes.com/atimes/Asian_Economy/KC26Dk01.html
http://atimes.com/atimes/Global_Economy/KC27Dj02.html
Well I prefer the school of thought from Jefferson and Hayek that ultimately believes in a more limited government. Ultimately a classical liberal stance.
When have Keynes' policies ever worked? When has unbridled spending ever created prosperity in the United States? I mean we're even surpassing the Europeans now; Sweden is refusing to bail out its failing auto industries but we are.
The solution from Keynesian supporters always involves higher taxes on someone or more spending in general. But taking away more of peoples' legally earned money is hardly the way to success. That's why I'm in favor of the Fair Tax plan because it means you are only taxed on what you buy, and not on what you earn.
Here in Australia, each political party generally come to their own consensus before decisions are made.
But in USA news reports, I see this congressman from this party or this one from another party raising their own issues, often against their own party.
Or I hear about Acts of govt being passed without the senate & congressmen even reading the documents.
We had no major financial issues here because the banks are heavily regulated (but still make plenty of profit for the shareholers). I think regulated capitalism is the best.
Is it true Obama has broken his promise to support the reintroduction of the Glass-Steagall Act?
Thanks
He's only been in office for 66 days, so it's a little premature to say much of anything at this point.
http://www.atimes.com/atimes/Global_Economy/KD03Dj02.html
Banks don't spend money, people do.
1) Capitalism is an economic system that, by default, then underpins our political system: Why, then just because we are in crisis, do we pretend that all along we thought it was a system of morality?
2) Just because something messes up, it doesn't mean it should be thrown away. What system, person or belief is completely infallible, infinitely simple to apply and always comes up with the goods, in all respects? I agree with the member who posted that it's not capitalism per se - it's greed that got us here.
3) Lastly, we are reacting as though basic human nature has been somehow exorcised out of us and are interpreting everything through the lenses of society and 'the system'. I have a Hobbesian view of human nature and therefore am not as surprised by the crisis as some make out they are. I think that, rather than giving floundering economists even more air time to say why they didn't see it coming and how long it'll last, could we not go back to our philosophy text books?
The world has seen all of the elements of this crisis many, many times before. Let us learn from those who set up the first 'societies', political and trading systems and stop pretending we know it all and the answers lie in the hi-tech future.
We blatently have a whole lot to learn from lessons already lived by our forefathers.
I think this is partially due to Adam Smith, who basically had the idea that the selfish and unrestrained (i.e. free) pursuit of self-interest would improve the general welfare, with the basic idea being that private profit will translate into public benefit. And I suspect that many people simply assume that "general welfare" is synonymous with "morality."
Of course there's nothing wrong with trying to improve how capitalism functions, but one of the main problems that people have with the capitalist system itself is that it's driven by greed. The very premise is behind it, as I've already said, is that the selfish and unrestrained pursuit of self-interest is a good thing. Therefore, capitalism itself often fosters greed in the way that it's structured, especially considering the fact that profit is the bottom line.
That doesn't mean that we should just throw it away, but some people simply feel that it's time to give another system a try, one that takes the needs of people into consideration more than the potential for profit. For example, we have dozens of brands of bottled water to choose from in our local grocery stores while almost 2 million people die every year from waterborne diseases and 1 billion lack proper drinking water (U.S. Centers for Disease Control and Prevention).
Of course, as I said in my original post, no system is perfect, but that doesn't mean we can't explore other options does it? I definitely think that capitalism has done a good job of getting us where we are, but maybe there's something better for where we'd like to be in the future (e.g., I Love Bill Moyers, but He's Wrong About Socialism).
I completely agree, but I think that one of the problems is that we're often not taught these things in school, or anywhere else for that matter.
As a matter fo fact, I watched a documentary about Howard Zinn the other day, and he mentions that he learned about the Ludlow Massacre from a Woody Guthrie song because his history text books (even in graduate school, mind you) never mentioned it.
History, I'm beginning to realize, is one of the most important subjects there is.
Jason
I was brought up in a multi-lingual, bi-cultural environment: more or less 'English' home but French school; 7 months/year in UK, rest in France. This meant that I learned two separate histories and two separate accounts of events where they intersected, e.g. was Waterloo a defeat or a victory? Who discovered calculus, Newton or Pascal? etc....?
It left me with deep doubt as to the interpretation and selectivity of historians and an acute awareness that they all have their own bias and agendas.
This came home particularly a few weeks ago when I clicked on a news story about something, and it was on the Xinhua (Chinese) website. I don't even remember what the story was about, but I do remember they had a link to a video about the glorious "serf liberation" celebration in Lhasa. I felt like throwing up. "Serf liberation", wtf? But you know, we all do it.
Palzang
Study without reflection is a waste
Reflection without study is a danger
And picking up on DD's post... What exactly is regulated capitalism? It sounds like a great system, I just wonder how it works in practice. What is the Australian economy like at the moment (we hear so little about it here in the UK)? What other countries can be said to have this system...?
"Will you say some prayers for us, Father," the Captain asked.
"Good Lord!" The clergyman exclaimed, "Surely things aren't as bad as all that?"
**********
UK churches, synagogues, mosques and debt advisory bodies are filling up as people get more and more scared by the ongoing financial collapse and its effects on the ground in job losses, repossessions, family rows, depression, e tutti quanti.
The danger of this is that people will harden their hearts against 'the other', from the reflex to blame someone else. Value would come if these community centres helped us to recognise our own, personal responsibility for more than our own problem. We were quite happy (as a nun said today on Radio 4's Sunday programme) to pick up the crumbs from the rich people's tables: cheap credit, house price explosion, cheap food, cheap fuel.
We have an opportunity to reflect and take more skillful decisions for the future.
Palzang
You use the phrase "pouring money" as if it were the government who was giving this group money and not giving another group money. I don't want the government giving anyone money. Not the rich, not the poor, not big businesses, not small businesses. I'm in favor of people keeping the money they make and not having some form of "mild theft" as John Stuart Mill called it.
If I work really hard, I don't think I deserve to get punished more by keeping a lesser percentage of the money I make. And I especially don't want that money stolen from me and given to someone who isn't working at all.
I don't understand the stigma against people making money. When a government says that someone makes too much money, it is clearly overstepping its rightful boundaries.
But, hang on to your hats, guys and gals, as we get ready for Round Two of our continuing trip into the Age of Limits:
“... nstead of the dollar serving as the answer to risk aversion, it may serve as the cause. This is specially so if investors come to see the hard-asset oriented investments in the emerging economies as better stores of wealth than a rapidly declining dollar. As we shall see later in this article, the emerging economies are weathering this storm much better than is the US. At some point global investors may become sufficiently repulsed by the dollar's mounting troubles that they refuse to give it the nod as a safe haven in any new storm.”
from this article:
http://atimes.com/atimes/China_Business/KF16Cb01.html
And, even more cheerful news:
“Clearly, a new era of cutthroat energy competition is on us ... The global energy equation is changing rapidly, and with it is likely to come great power competition, economic peril, rising starvation, growing unrest, environmental disaster, and shrinking energy supplies, no matter what steps are taken ... [T]he new trends in energy on the planet are already increasingly evident - and unsettling.
from this article:
http://atimes.com/atimes/Global_Economy/KF16Dj05.html
... which, in turn, makes inter-connected aspect of the world all the more relevant:
http://www.time.com/time/world/article/0,8599,1903232,00.html
I would suggest that at the moment we are only seeing the calm before the Real Storm.
But when are we going to stop talking about money and prison and accountability and fat cats... and start talking about how wrong it is to make it your life's work to put so much bad energy about... just because you can.
From this article:
http://atimes.com/atimes/Asian_Economy/KG16Dk01.html
Well worth the read.