Saturday, February 25, 2012

The Age of Tumult

We live in age of tumult. The worldwide economy is severely depressed though some are trying to address the issue, President Obama included. Controversy over hot button issues is fed by the media but the central issue of fixing the American economy. Hot button issues are a distraction from the problem, as is celebrity gossip.

We have in this country a massive wealth gap that has been exacerbated due to the Great Recession. Economic inequality has always existed in the world and in America but during the New Deal policies enacted by Franklin Delano Roosevelt, himself an aristocrat, were put in place eased the situation up until about 1980. The power of the large corporations and the wealthy interests received many setbacks in pursuit of their own ends.

Their defeat was great. It lasted until they understood the value of co-opting populism and working class sentiments. The self-made man has always been the Great American Hero from Ben Franklin to Abraham Lincoln to the stories of Horatio Alger. Nixon and Reagan tapped into this perfectly and broke what had been a great unifying force among the Democratic Party. Beginning in the 1960’s and into the 70’s and 80’s the policies put into place largely by progressives began to be attacked with a renewed fury and the gap began to widen again.

And now our current President (whom I am in favor of) is the epitome of this ideal having risen from obscurity to great heights of success. Such a hero seem to prove that the system works. That it is still possible for those who begin without ample means can retire in grand style. Almost everyone in America wants to be rich or at least comfortable. And touting the great success stories inspires those toiling in grim and grimy conditions that there is hope for a better life.

When there is no hope, then the system starts to fall apart. When it becomes more difficult to succeed people start paying attention and demanding results. And that is what is happening now.

The problem though is that results take time to produce. The average economic cycle from boom to bust to boom again takes time. This is especially poignant since many do not realize how close the global financial system came to collapse in September 2008 and the quick action that was taken to stop utter ruin without addressing the side effects. And no one wants to wait when the level of unemployment is high and politicians need to be re-elected.

And if you lose re-election then your ability to affect change directly ends. Not that many defeating politicians go home of course. But that is beside the point.

And who has time to actually solve problems? Members of Congress spend little time legislating or forging deals to help people. Many see it to their advantage to the American economy continue to sputter until their side wins complete control this November.

Part of their constituency will inevitably be disappointed at whatever deal is made. You can’t please everyone all the time.

The way to improve the economy varies greatly depending on your view of the situation from deficit spending and investment to deregulation and tax cuts. A tax cut on the very poor though is different from a millionaire’s tax cut. I am in favor of an increased tax on millionaires as a means of deal with our deficit problems.

This is just a beginning of my insights into the current issues of our time. Stay tuned for more insight!