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The Economy: Recession, Depression, Crash or Collapse?

By Jay Farr  Posted by Jay Farrington (about the submitter)       (Page 1 of 2 pages)   8 comments
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What is Really Happening to America's Economy? 

As a layman, I don't know more than anybody else, but in the interest of speaking out for lots of Americans, here is my assessment of the immediate challenges facing our nation:

"Where Are We?" 

We are mired in an endless war that has looted America to the tune of nearly a trillion dollars so far. That is $1,000,000,000,000. The cost of the Iraq adventure continues to mount, running up the bill on future generations despite recent "successes."  

Americans who earn average and below average incomes are in free fall. A few hundred dollars per family as economic stimulus will not help much, and won't even be a speed bump in the downhill rush of the economy.  

Our "growth economy" is based on printing and borrowing more money, which is similar to a snake swallowing its tail because it ignores inflation, diminishing resources, outsourcing and cheap competition. We are caught in a vicious cycle of periodic meltdown that results from a nexus of bad policy, poor leadership and flawed design. 

Tragically, the Bush promises of smaller government and cutting spending have not been kept, but tax cuts are sacrosanct. ("It's the tax cuts, Stupid" has been on the Republican chalkboard for thirty years). Tax cuts have again helped shift the wealth upward and increase the deficit. 

Deregulation has given us Enron, blackouts, higher prices, energy dependency, financial chaos and corruption. Wal-martization has allowed small businesses to be crushed or swallowed up by corporate greed. Our global trade and business practices undermine America and Americans. 

Government has abdicated its sworn responsibility to the people in a drive toward privatization, ignoring existential issues such as response to disasters and emergencies, rebuilding the military and acting on planetary survival. 

"How Did We Get Here?" 

In the beginning, there was the Constitution. The Federalists were for a strong central government as opposed to a loose federation of sovereign states. Alexander Hamilton conceived the idea that if the central government were to go into debt, it would tie things together and the United States would become a single, unified nation.  

Conventional wisdom holds that Hamilton's concept of indebtedness was the catalyst for our becoming the greatest nation on earth by the 20th century. Other candidates for that distinction include the American Spirit, free public schools, the income tax, free market capitalism, and free land, to name a few. 

We hit the Industrial Revolution, the Gilded Age, anti-trust scandals, three wars, Income Tax and the Great Depression going way too fast. New Dealers credited FDR with saving the nation from economic destruction with government leadership. For decades, there would be no protests against taxes because during the Great Depression and the recovery, Americans could see a direct connection between the revenue raised and the government programs that were their lifelines.      

Then came the Cold War, the highlight of which were not just two wars of attrition fought against Communists in Asia, but the downfall of the Soviets, whom we ostensibly outspent into oblivion. Apologists claim Reagan intended just that all along, despite his administration's record spending and the resulting record deficit. 

"Reaganomics" promised to lower taxes, cut spending and most important, reduce the size of government and all its growth-stifling regulations, taxes and general interference in the real business of America, Business.  

In reality, Reaganomics produced unprecedented numbers of small business failures and an even uglier phenomenon, widespread homelessness. For the first time, a new class emerged: the working poor. Many worked, but lost their homes anyway.  

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Fulbright in 1966-67; Visiting Lecturer in American Literature with Baghdad University/Texas University Exchange Program. Guest Lecturer for the American Authors Lecture Series for the United States Information Service in Iraq. Co-authored with (more...)
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