The Market Collapse Was The Goal, Not A Mistake
It's early in this crisis, but I fear that the Dems and liberals will miss the larger point in trying to blame the Republicans for the current economic woes: The economic downturn -- the collapse of massive financial institutions and the loss of savings, houses, and jobs -- is not a mistake. It's not an accident. It's the point of unrestrained free market economics.
The whole idea of an unregulated market is to allow growth through destruction. Those who take the right risks are rewarded. Those who take the wrong ones are dangerous, and ought to be wiped out. Invest in Lehman Brothers? Buy a house in an up market? Invest in subprime mortgages? Good riddance to bad rubish.
Thus, far from a set-back, the current financial crisis is the goal that the Republican party has been working for since at least 1980. That's why the president called this a "correction." It is. And if we keep these policies, we can expect more corrections, on a more regular basis in the years to come.
Mazel Tov!
I'm sure that the Democrats will hurl lots of blame at the Republican party. And if history is any guide (and if there is a God), it will pay off in November. But let's not call it a mistake. Let's make sure everyone knows that this has been their goal for quite some time. And maybe, just maybe, we can kill unrestrained, free-market conservatism -- at least for a generation or two.
It's not a bug - it's a feature!
September 15, 2008 10:44 PM | Reply | Permalink
Right, except they want to pretend it's not. Why let them off the hook?
September 16, 2008 9:12 AM | Reply | Permalink
I did not intend for this to be so long.
Are you are suggesting the GOP wins in November due to the downfall of 5 (maybe more) of the longest standing and most reputable financial institutions? Am I missing something -- I cannot fathom how that possibly plays in the republicans' favour. They love deregulation and a free market, but never considered the consequences.
Although You may have a point about this being planned I have a difficult time wrapping my head around that concept.
Having said that, Naomi Klein discusses at length in her book, "The Shock Doctrine," situations that present the perfect storm per se. Basically the book's underlying theme is (her term) "capital disaster."
With nature playing havoc and manmade wars, as long as there is money to be made, profiteers have no compunction exploiting human-tragedy for a profit.
While people are too traumatized, too distracted and too encumbered with their own personal situations and perhaps survival to contend with much else, unfettered and unencumbered the powers-that-be go to work privatizing and selling nationally-owned infrastructure, state-owned businesses, natural resources, and government-run public services. Translated means huge profits.
They tried it in Iraq. Only because al-Sadr intervened it did not turn out as successfully as hoped, but that is an entire other subject.
Similarly in the aftermath of natural disasters prime real estate, long off-limits to developers, is often sold to the highest bidder. Then after it becomes a fait accompli developers quickly move in to build exclusive western-style resorts and hotels.
For example Sri Lanka's sea-side fishing villages laid to ruin by the tsunami were replaced with luxurious hotels, resorts and shops. The fishermen, whose livelihood and survival depended on living by the sea, disappeared along with their villages.
The concept of a free-market completely removes the public-good from the equation. It is all about making money at the expense of vulnerable citizens. Greed drives the machine, not social justice.
It is well-documented Bush dismissed warnings against deregulating the financial institutions. This crisis could have been avoided to begin with, but Bush refused to heed the warnings. If he had at the very least enforced the few regulations still in place it could have softened the impact. Worse even after leaving the station Bush could have derailed the imminent train wreck, but chose to ignore the warnings.
It is unimaginable The Lehman Bros., one of the oldest established financial institutions that survived two World Wars, the "Great Depression", etc... etc... went completely under with Bush 43 in command.
Five (5) of the largest financial institutions are gone. We'll know more tomorrow if one of the largest financial insurance backers will follow suit.
Manmade "perfect" storms still in the experiential stages are prone to mistakes. No one but an absolute fool would dare take such a risk. On the other hand there is 1 person who might give it a whirl: Bush 43.
Instead of a deliberate plan, a more likelier scenario: Absent reasoned logic, forethought, and/or a Plan B, yet encouraged, supported and cheered by party members and a handful of blue-dog dems, with willful ignorant incompetence, stubborn denial, self-interest, self-elevated importance, in conjunction with a flawed political ideology Bush irresponsibly led the nation into financial dire straights.
That does not constitute a recipe for winning elections.
But heaven help us all if proved otherwise !
September 16, 2008 6:30 AM | Reply | Permalink
Serena,
Thanks for your thoughtful remarks. Perhaps I was unclear, so please allow me to clarify:
(1) I think the economic downturn hurts the GOP and helps the Dems in this election (I meant blaming the Republicans for the economy will pay off for the Democrats).
(2) I'm not cynically suggestion that the Republicans are offering financial ruin as a campaign promise, or that they did this in order to push the election for McCain. They know this hurts them as much as we do. I am saying that periodic financial ruin is part of the unrestrained free market system the Republicans tout. It's just the Darwinian side they don't like to talk about. And we ought to. (Any free-marketeer who doesn't believe this, doesn't understand her own economic policy. I'm assuming they've thought this through.)
(3) The liberal vision since the New Deal has been well-regulated markets (being necessary to the security of a free State?) that allow for less catastrophic risk, with higher lows and lower highs. The Republicans want a highly deregulated market, with higher peaks (because, who doesn't?) and lower lows (to really clean out the gutters, as is happening now). That's why the President called this a "correction," and why McCain said "we're going though a difficult time" but not that the system is broken. And in this society we can choose how much regulation we want. In 1932, Roosevelt offered a New Deal, and the radical free-marketeers of his generation never got their grubby hands on the machinery of government again; it took a few generations. So, let's not waste this by calling it a mistake, because it's not. This is exactly what they've been planning.
--EZE
September 16, 2008 8:45 AM | Reply | Permalink
Or perhaps not "planning," but a natural consequence of the policies that they promote. They don't actually see this as a bad thing and not something that needs to be corrected. That's just not something that they can say, because the little guys who get hurt by these "natural consequences" won't like it and will vote them out of power.
September 16, 2008 12:31 PM | Reply | Permalink
I still think "planning" works because one of the touted pros of the unrestrained free market is bringing down all those who make unwise decisions, big and small, leaving room for the more fit to prosper (hence, Darwinian economics). But I gather your general point, and essentially agree.
September 16, 2008 8:51 PM | Reply | Permalink