New York: The Hank and Ben Show was doing so well in the ratings. They crafted a plan---ok, only 3 pages but still a prodigious effort in an era when so few can agree on the need for heat on a freezing day. But now the great unraveling has begun. Remember Karl M’s lesson on the dialectic: thesis leads to antithesis resulting in synthesis. Maybe.
They sold the Democrats on the need for a bailout. They made it big so the rest of the world would notice and be impressed. They started out unreasonably demanding total power knowing they would have to compromise and so allow all sides to win something and hence come aboard.
Paulson knew he had to act fast, to make it happen in the same time period in which God was said to have created the world. The 7 Day clock was ticking and they seemed headed for the endzone. A former football player, he avoided blocks by Nancy and tackles by Barney and was ready to throw a Hail Mary Pass if all else failed. President Bush was awakened from his slumber, given a script and a role to play in his White House pulpit. When his own party balked summarized the problem this way:
“This sucker could go down.”
It wasn’t clear who was the sucker—the system, the taxpayers or both but it didn’t matter. The credit markets were seizing up. Washington Mutual imploded and that hard rain that Dylan warned about was falling ominously on Washington and Wall Street at the same time.
Was this the deluge Jackson Browne warned about?
“By the magnitude of her fury in the final hour
And when the sand was gone and the time arrived
In the naked dawn only a few survived
And in attempts to understand a thing so simple and so huge
Believed that they were meant to live after the deluge”
There certainly was a deluge of conflicting opinions, posturing and polemicizing. There was hysteria on the right about the coming of communism which must have amused the Chinese, and anger on the left which expressed itself in protests that the Big Chief Democrats ignored as they compromised or cave their way to the table.
Missing in most of our media coverage which reported the drama as a sit-com while focusing on the political debate to be or not to be, was any sense of what's really behind this---a debt we cannot manage or wish away.
We are bankrupt and this may be a going out of business sale, as foretold by the Iranian President who said the US Empire is spent. Noted the Journal Inquirer.com:
''... even if it can work -- that is, prop up insolvent financial institutions -- the Treasury's proposal is still a proclamation of the collapse of the whole U.S. financial system. Even if some financial institutions are saved, the collapse will manifest itself in other ways, probably ways more damaging to the public. For who cares if Goldman Sachs and Morgan Stanley endure if the issuance of $700 billion more in government bonds drives interest rates way up, diverts credit from the private economy, devalues the already sinking dollar, and sends commodity prices soaring again?''
Lordy, Ms. Claudy!