Fiscal Failure and the New Recession
By Robert George Sprackland, Ph.D.
Back in late 2008 the Government of the United States of America said it would take at least $700,000,000 dollars – all the zeroes make the number, seven hundred million, look as formidably large as it is – to keep the major economic institutions from crumpling. For the fee of about $2,000 from every man, woman and child in the nation, the government would cover the debts and losses incurred by the grotesque, inept, and criminal failings of the financial leaders of Wall Street and Washington, D.C.
Pat Buchanan, in an editorial published on September 28th, claimed that our government servants were now trying to be “hailed by the media as the 7th Cavalry coming to rescue” us. With apologies to the 7th Cavalry of the twentieth century, I believe that most of us who know a bit of history equate the 7th Cavalry with the ignominious defeat of George Armstrong Custer and most of his regiment in 1876. Was Buchanan making a subtle suggestion that the bail out, too, will lead to even greater losses to our financial foundations? If so, the following three years would prove him to be on target. We had heard about congress getting ruffled when it learned that bail-out money was being used to pay some of those infamous executive bonuses we call “golden parachutes.” Then the failing auto industry followed. If this is the 7th Cavalry coming to the rescue, I think I want to be on the other side.
More important to me – political Luddite that I must be – is why there has been no discussion about investigating the causes of these mass failures and punishing their main architects. It is long past time to snip the guy wires of the golden parachutes of our most insidious thieves. Outside the United States you must be a deposed dictator to escape the old job with enough cash and perks to start your own new country or two. America’s top executives are guaranteed unjustified astronomical wage and perk options (which is not really just a matter for the stockholders; those awards come from raised prices that come out of our wallets), but they also get obscene bonuses and golden parachutes when they are fired! I have worked many jobs in my life, and never been offered even a years’ wages as a bonus for a job well-done, let alone enough money to take care of my family and me for some 30 to 50 generations.
Those perpetrators are not Horatio Alger stories the rest of us should emulate. They are the stories of cutthroat and greedy people who see no obstacle to their amassing huge fortunes as being off-limits. Just look at what the Enron team did for the pension funds of its employees. Did a single Enron exec have to repay those victims from his own golden parachute? The people who caused the failures should be made accountable, and if they made any profits they should return them to the companies and institutions they so miserably failed.
Don’t the rest of us have to make amends when we screw up? Old disgraced billionaire robber-barons don’t disappear. They turn up again and again, always preparing another golden parachute. The rest of us can declare bankruptcy, lose our homes, join the unemployed. In the words of a song about the health insurance industry, the Austin Lounge Lizards put it coldly but accurately: “I’ve got my share so I don’t care,” says the HMO CEO as he makes snow angels in a pile of gold coins, “so go ahead and die.”
Mr. Buchanan went on to note: “In a democracy… you get the kind of government you deserve. But what did the American people do to deserver this (fiscal crisis)?” Really, Pat, I’ve never met you but I still know you’re a whole lot smarter than that. What the American people have done is allow theater to replace political debate. It matters little to most voters whether the Swift Boaters were telling the truth or lying; whether Iraq really had WMDs or not; whether the U.S. starts torturing prisoners or not; whether major corporations are run by people with successful and ethical track records or by people with friends on the board who are content to keep the big bucks “in the family.”
Americans have allowed government officials to slide away from accountability and possible punishment with nothing more severe than a bad press day or two. Americans have simply lost the empathy to understand what is going on in the world and in their names. So long as Americans have their beer, TV, and cell phones, who cares about those boring politicians?
“Hey, is Obama Christian or Muslim?” Who cares, Paris Hilton is going to jail!
“Is the bombing of Iran really a major military plan being considered?” Not now, 'American Idol'’s on!
“Hey, Hon, I heard on the news that our retirement funds have just been wiped out by your company’s CEO!” Fine, fine, let’s talk about it after the Superbowl.
When Franklin Roosevelt made his famous speech about “fear itself,” he was not addressing the coming World War II, but the bowels of the Great Depression. "So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself - nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance." When he spoke these words at his inauguration in January 1933, he was not telling people not to fear, but that they could not afford to let fear control them.
Will the inauguration in 2009, 76 years after Roosevelt’s, include similar sentiments?