After the first few years, by the mid-1930s, although the situation was objectively much harsher than it is today, the spirit was quite different [...] There was just a sense that somehow we're going to get out of it. It’s quite different now. Now there’s kind of a pervasive sense of hopeless [sic], or, I think, despair.Full disclosure: Professor Chomsky is consistently called the smartest man in academia and has a lot of credentials to prove it. I am an unemployed college graduate. Long story short, his analysis is probably right.
However, I don't know anyone with a sense of hopelessness or despair about the current economic climate, and I am willing to bet most people don't. I also find it strange that he thinks the protests are really indicative of those feelings to begin with. My reading of the situation is that a lot of unemployed liberal and fine arts types have banded together with socialists and market-reformers to protest the banks' actions over the past couple of decades. A few videos I have seen have featured protesters who say they love capitalism. Though maybe Dr. Chomsky is right; perhaps those sentiments are widespread. My question is: should that really affect policy?
There are plenty of arguments that this is a republic and not a direct democracy, but you can read or hear about those anywhere. What I want to challenge is the notion that any pervasive feeling has anything at all to do with the government. This isn't A Brave New World, the government does not have a dose of Soma to make us all forget our problems, nor does it have the ability to correct the problems at hand in the Great Recession.
Calls are made for a debt jubilee, another stimulus package, or to lend even more money to the banks directly. The first idea is nonsense. To make it clear, the writers of Salon's piece only want debt relief for the 99%, so it wouldn't necessarily cause a complete collapse of society. And maybe their logic is something along the lines of: "The 99% only control such a small portion of the wealth in the country. Therefore if we forgave their debt, the economic ramifications wouldn't be so bad." First of all the 99% do, according to liberal sources, control the majority of wealth in this country. I often hear it quoted otherwise, but that is simply not the case. But that argument was a straw man anyway. To main problem with a debt jubilee is that our society is structured around agreements that carry the weight of law. We make contracts over debt, marriage, inheritance, and anything else; these contracts are only meaningful in that they are backed by the government. Not in a financial sense but a judicial one. The more practical problem is that once you put the idea out there, the more politically connected will have that option in the future. This is my main divergence with the protesters and most progressive populists. Typically, a progressive-leaning person will see injustice caused by a big business's governmental connections. They think that they can fix the problems of government by fixing the regulations or otherwise empowering government. All the while they fail to see that businesses will be called upon to help write the regulations and be the recipients of the power. To put it simply, the banks and auto companies had their own debt jubilee already because they are politically connected, isn't that why the protesters are out there to begin with?
The stimulus package and the issue of the Federal Reserve lending money directly to the banks are one in the same. First of all, if we are going to try to fix the problem by spending the money should really go to those who need it, via welfare systems. This is NOT what will happen if you let the government dole out the money. They will give it to banks and other politically-connected entities, and the money will trickle down fractionally to the people who are most hurt by the recession. I do not understand where progressive ring-leaders get the idea that this is some sort of magic wand.
To conclude, let's go back to the Noam Chomsky piece. He did an interview with the masses afterwards in which this question was asked: "What about the ruling class in America? How likely is it that they'll have an open fascist system here?" Dr. Chomsky astutely observes that this scenario is very unlikely and then goes on to say that the rich have lost their taste for force in America and England. If someone asked anyone other than an anarcho-socialist like Chomsky, I am sure he/she would immediately object to the notion that there is a ruling class in America. We don't have to kneel to the bankers, our representatives in Congress, the Supremes, or even the President. This set of people do not even "rule" us in any proper sense of the word. The fact that the person who asked the question is not jailed is testimony to that fact.
I think a lot of the occupiers have massive student debt but are still above the poverty line. Your suggestion to help the poor through standard welfare practices wouldn't affect them. I am not sure whether or not the government should be trying to help people who got into debt voluntarily, but, hypothetically, how would you do it?
ReplyDeleteI don't think I said that I would help the poor through standard welfare practices, I said I would help those affected by the crisis through standard welfare systems. I guess what I really meant was that what I would have preferred to TARP would have been a system that sent checks to retirees who were most seriously affected by their investments. However, I am not sure that they should be getting the welfare. Everyone who has a 401k should know that it is tied to stocks, same with anyone who has a mutual fund or a CD. These things are not risk proof!
ReplyDeleteThat being said, the retirees were told that their assets would only be invested in very safe (AAA) places. There seems to be some fraud that went on here, but it is really hard to pinpoint who should bear that onerous burden. In short, I guess I would be okay with that welfare.
But this just brings us to the point that most of the OWS protesters seem to have been affected only at the end stage of the crisis. That is, they have been unable to find work largely because the markets haven't cleared yet. The best way to help them is to help the market to clear. The best way to do this is debatable. In my opinion, it is probably only going to be fixed with time and maybe a little more certainty from the government. More and more it seems to me that a lot of the protesters' main problems have been caused by taking out loans to get a major in the fine arts, which is not marketable in any real sense of the term.