Fix this, Mr. Peterson

After the 2004 presidential election loss, two of us here started a local political group. We were in the newspaper. Shortly thereafter we were contacted by the then-CEO of this candy company.I don’t remember how he contacted us, probably an email. If I had known what I know now I would have recognized that as a threat and that might have been the end of it, but we were all naïve about email back then. We didn’t look for subtext or malicious, secret intent. He congratulated us on our new organization and wished us luck in the next election. It wasn’t partisan. It was more like this: “Democracy! Don’t give up, please. Thank you.”

So time passes and then we’re at the 2008 primary, and I’m involved as an Obama delegate from this congressional district. I attend a couple of Ohio Obama organizing events prior to the 2008 state primary and he’s there, and we chat a bit about the Democratic Party primary process and Democrats, generally, process and psychology. What’s a super delegate, how does Ohio’s primary process relate to pledged delegates, why are Democrats such a huge pain, those sorts of things. I feel as if I’m explaining “Democrats” to him, an organizational culture he’s unfamiliar with but studying. So Obama’s the nominee and he periodically checks in with us. We win in 2008, and I don’t see the now-retired CEO again until 2012, when we invite him to the county Party dinner and he attends. He again checks in periodically, and we go on to win in 2012.

This is a link to an interview he gave with Bloomberg immediately prior to the 2012 election. I don’t know if he considers himself “a Democrat”, now, I would bet not. He says his company has core beliefs that are not exclusively geared to short-term profit. He says he could move production to Canada 120 miles away and make a lot more money (the US has sugar price supports that hurt domestic candy producers) but his employees are a huge asset so he doesn’t. He says with great pride that 25% of his employees have been working there 25 years or more.

I was struck by his response when he’s asked about the political climate in Ohio, and how it relates to the economy. His entire focus is on what we went through, in the Great Recession. He doesn’t mention it here but his employees are union, they’re Teamsters, so he has to actually negotiate with them which may be why he knows what they went through. He talks about the fear and uncertainty he saw “on the faces of our people every day” and that what he refers to as The Great Recession was “very real, very painful.” He tells them unemployment was at 17% and probably at 25% in underemployment and people were terrified. We saw that here, too. We saw some really alarming behavior in this office, people just stressed to the breaking point, losing their temper or crying or (the worst) just shuffling in with foreclosure papers or a notice of hearing on a collection action and showing no affect at all. They had the safety net; unemployment insurance, food stamps, school lunch subsidies, heating aid, Medicaid for some, but far from Paul Ryan’s impression that they were all lolling about in Obama’s statist hammocks, they weren’t sleeping at all. We heard that again and again, how no one was sleeping well. He says that he remembers his mother lecturing him on the Great Depression and that he now has “some sense” of what she meant. He also says that “working people in particular have experienced trickle down for 30 years and they’re pretty skeptical about what’s trickling down”. Whoa, there, Marxist. Who let this 1%-impersonator on the Bloomberg set!

I was so pleased he focused on what happened, The Great Recession, because I feel as if I don’t want that to go on by without more attention paid to what just happened to all of us. It seems as if the entire focus going forward has been on whether markets and managers are sufficiently confident and that, to me, is the wrong question. I think we should be asking if people are confident in markets and management. Knowing that, knowing how terrible that time was, how does constantly threatening to push us all off a cliff help with our confidence levels? What about the seemingly deliberate and needlessly dramatic depiction of Social Security, Medicare and Medicaid as “bankrupt”? Those things are the safety net, SAFETY being the key word there. Wouldn’t intangibles like “certainty” and “the ability to plan for next month” be most important to people who have the fewest tangible assets to fall back on?

Did what we’re all witnessing now happen after the Great Depression? Did a big herd of wealthy people descend and immediately start delivering threats and stern lectures to the people “out here” who just survived something like the Great Recession? Is there any precedent for a group like, oh, Fix The Debt, after an economic collapse?

68 replies
  1. 1
    Short Bus Bully says:

    THIS post needs to be said again and again. The Galtians want to imagine that the 1% makes the world go around, but the simple truth is that without the “bottom” 99% to buy everyone’s products there would be no economy.

    The focus by the media, as always, is in the wrong place.

  2. 2
    Yutsano says:

    Right after the Great Depression was WWII. Rich folk ended up not having time to lecture us poor commons on how we should have treated all those bankstahs better.

  3. 3
    gene108 says:

    Whoa, there, Marxist. Who let this 1%-impersonator on the Bloomberg set!

    Bloomberg News is pretty apolitical and does a good job, with regards to business reporting.

    Yes, it’s slanted towards stock investing and capital, but that’s what the people, who tune into business news are interested in.

    ******************************

    Did a big herd of wealthy people descend and immediately start delivering threats and stern lectures to the people “out here” who just survived something like the Great Recession?

    No, but universal healthcare, first proposed in 1948 by President Truman died a swift death and there’s the anti-union bill that got passed over Truman’s veto around the same post-WW2/post-Great Depression period.

    There’s a real desire to rebalance the scales of economic and social justice, there just needs to be a politician, who can give it a voice and appeal to the voters. I think a lot of people hoped (assumed) Obama could’ve (would’ve) been that guy in 2008, but he hasn’t been the guy to usher in a new age of liberal politics and send conservatives running to disassociate themselves with conservatism.

    Maybe there won’t be a liberal politician, who pulls together various coalitions and changes the politics of this country. Maybe the backlash of the 99% will just bubble up to the point it can’t be ignored, but usually big sweeping political changes have a leader, whether it was FDR and the New Deal or Reagan and modern conservatism.

  4. 4
    Bagofmice says:

    I apologize, but the media reaction to the Woodward thing deserves a ton of curated meat-nuggets! Felt threatened? Meat-nuggets to the thighs, men!

  5. 5
    Ted & Hellen says:

    @gene108:

    there just needs to be a politician, who can give it a voice and appeal to the voters. I think a lot of people hoped (assumed) Obama could’ve (would’ve) been that guy in 2008, but he hasn’t been the guy to usher in a new age of liberal politics and send conservatives running to disassociate themselves with conservatism.

    but usually big sweeping political changes have a leader, whether it was FDR and the New Deal or Reagan and modern conservatism.

    This means you want unicorns, fairy dust, and something, something…

    Obama, despite his pure intentions, has been UNABLE to lead, don’t you see, because Republicans are mean.

  6. 6
    Kay says:

    @gene108:

    Bloomberg News is pretty apolitical and does a good job, with regards to business reporting.

    Agreed. I listen in the car, on the radio. I like how boring their daytime announcer is. It’s oddly refreshing. Just the facts :)

  7. 7
    gene108 says:

    What about the seemingly deliberate and needlessly dramatic depiction of Social Security, Medicare and Medicaid as “bankrupt”? Those things are the safety net, SAFETY being the key word there. Wouldn’t intangibles like “certainty” and “the ability to plan for next month” be most important to people who have the fewest tangible assets to fall back on?

    I really do wish the White House would stand up and say “government can be the solution”. Government reduced poverty amongst seniors with Social Security and Medicare, for example.

    They could’ve really articulated what the government does well and the damage cutting government spending now could do, during the sequestration debate.

    For whatever reason the White House has never been able to cut through the right-wing noise machine, unless they are in actual election campaign mode.

    I think part of it maybe all those law school/PR spokes people usually do what they do because they suck at math and explaining economics requires dealing with math.

  8. 8
    Boots Day says:

    It seems like it ought to be obvious by now that government policies to help working people have more spending money help the 1% as well, by providing them with paying customers. Focusing on getting more money to the 1% – and hoping they’ll be altruistic enough to offer us poor 99%ers jobs as a result – seems totally ass-backwards to me.

    It also seems obvious to me that the 1% would benefit far more from strong economic growth than they would from cutting their income tax rates by 2 percentage points, or whatever Paul Ryan wants to do for them. But what do I know.

  9. 9
    schrodinger's cat says:

    Fixating on cutting the deficit and worrying about the debt when the unemployment is so high. Is like worrying about losing weight, when you are bleeding to death. Yes it would be good to lose weight, but the short term problem needs attention first.

  10. 10
    beltane says:

    @schrodinger’s cat: And the worst part of it is that the weight loss plan in question involves cutting off one’s limbs and head. Yes, this will result in weight loss, but at what cost.

  11. 11
    Belafon (formerly anonevent) says:

    Yes, lots of people went in and said the cure for the Depression was to cut government spending. Hoover tried that, and failed. That’s a big difference between now and then: Now a Democrat swooped in so quickly and stabilized things with a stimulus that a lot of people, especially Wall Streeters, think that the Great Recession wasn’t that big of a deal. It would have been painful but some part of me wishes that the big part of the recession had of occurred in 2007.

  12. 12
    Grumpy Code Monkey says:

    @Ted & Hellen:

    Obama, despite his pure intentions, has been UNABLE to lead, don’t you see, because Republicans are mean are the majority party in the House and can thus thwart Obama’s legislative agenda, and indeed they have effectively sworn an oath to do so.

    FTFY.

    Congress runs the show, not the President. Congress is the reason Obama has been unable to close Gitmo. Congress is the reason we’re heading into Sequesterville.

  13. 13
    jl says:

    ” Did what we’re all witnessing now happen after the Great Depression? Did a big herd of wealthy people descend and immediately start delivering threats and stern lectures to the people “out here” who just survived something like the Great Recession? Is there any precedent for a group like, oh, Fix The Debt, after an economic collapse? ”

    Yes. It lead to the recession of May 1937, which had lingering effects through 1939, which still had a high unemployment rate. And in the mid 1930s FDR was even more on board with those mistaken advocates of debt reduction above all than Obama is now. So, at least some of our leadership has learned something over the last 65 years.

    Keyenes issued his quip in the mid 1930s when economic stimulus was cut back: “they profess to fear that for which they dare not hope”.

    U.S. ramp up of military spending in 1940 to aid future allies in WWII was start of huge fiscal stimulus due to war effort.

  14. 14
    schrodinger's cat says:

    It is kinda sad that Obama has fully brought into (or else he is doing it for the consumption of VSPs) the deficit reduction claptrap, he devoted almost 20 minutes of his State of the Union speech on deficit reduction.

  15. 15
    Kay says:

    @beltane:

    I have genuine anger about it. It was hard to stay afloat during that period. They’re going to deliberately push us back down? I mean, Jesus Christ. WTF? What did I ever do to these people?

  16. 16
    schrodinger's cat says:

    @jl: What is your opinion about that hack Amity Schlaes? and do you have any suggestions for a book on the Economic History of the Great Depression. What do you think of Milton Friedman’s book on the Great Depression.

  17. 17
    beltane says:

    @Belafon (formerly anonevent): Our main problem here is that the Great Recession did not financially wipe out a single rich person. Since the financier class escaped unscathed it’s almost like we never had a recession at all.

  18. 18
    schrodinger's cat says:

    @Kay: They didn’t get rich by caring about other people.

  19. 19
    gene108 says:

    @Ted & Hellen:

    Obama, despite his pure intentions, has been UNABLE to lead, don’t you see, because Republicans are mean.

    Politicians NEVER LEAD.

    They give an outlet for popular movements. LBJ pushed the Civil Rights movement into policy.

    Regan pushed the conservative backlash against the Civil Rights movement and Great Society into policy.

    The problem Obama faces is liberals refuse to get behind a common economic theme.

    Reagan’s line that “government is not the solution, it is the problem” galvanized the social conservatives and economic conservatives into groups that have a common theme, “shrink government”.

    Liberals have done a good job getting behind social issues, like gay marriage and have pushed it in a unified and coherent manner.

    There just isn’t the same sort consensus on economic issues. You have liberals like Krugman, who think screwing the poor is a bad idea, but enjoy their six figure salaries and the life style it allows them and are relatively pro-business. You then have the loudest group of liberals, who are on the opposite of the spectrum and view profit as a bad thing.

    For example, enabling the health insurance industry to make profits via the PPACA, rather than drive them out of business via single payer/public option, set the latter group over the edge and against Obama.

    Lacking a unified push on economic matters, there’s not a lot for President Obama to embrace.

    On gay marriage, for example, he’s gone from ambivalent to championing it.

    If you want the same result on economic issues, people need to get behind a coherent theme.

  20. 20
    schrodinger's cat says:

    Also there was a strong labor movement in the US and abroad, during and after the Great Depression. Labor has been so weakened that it is almost toothless, right now. There is no effective counterweight to the rentiers.

  21. 21
    PeakVT says:

    Is there any precedent for a group like, oh, Fix The Debt, after an economic collapse?

    As for an actual group, I don’t know. But it’s important to remember that in 1936 there was a push to balance the budget, and IIRC Roosevelt went along because he agreed. This created an unnecessary recession in 1937-1938. Employment went from about 14% back up to 19%. Growth returned in late 1938, and then took off once the US entered WWII.

    ETA: Keynes’ General Theory wasn’t published until 1936, so nearly everybody was still operating without the information we have today that makes the whole austerity push so inexcusable.

  22. 22
    beltane says:

    @Kay: Until something happens to make the rich feel the same fear the rest of us live with every day they will never, ever learn to behave. It is a case of “Spare the rod, spoil the 1%er”.

  23. 23
    schrodinger's cat says:

    @beltane: I think the threat of communism kept the worst instincts of the oligarchs in line at least in the west for most of the 20th century.

  24. 24
    Kay says:

    @gene108:

    There just isn’t the same sort consensus on economic issues.

    Democrats won’t admit this, but it’s true. They don’t really have a unified, modern economic policy, on trade, or job growth, or any number of affirmative issues, outside the safety net stuff. You really can’t just go back to FDR, for everything under the sun.

  25. 25
    Keenan says:

    Government is essential to the survival of our civilization. Beyond the need for infrastructure, defense, and commerce, government should have our backs in cases of disaster and loss. It should be there help the weakest of us rather than tilt the table of wealth further towards the richest. Wealth will reallocate itself when you have fairness and people are treated as humans rather than commodities.
    I just can’t see how Congress can justify tax credits for oil companies, mortgage interest on second homes, and hedge fund vultures. It just seems common sense to end these.

  26. 26
    Citizen Alan says:

    To me, this just shows the power of television and the danger of media consolidation. If Fox News had existed in the 1930’s and reached the same percentage of Americans with its vile demagoguery, I suspect FDR would have lost in 1936 and by 1940, we’d have had an alliance treaty with Hitler. (And screw Godwin, we all know perfectly well that the Fox News of 1939 would have been pro-Hitler.)

  27. 27
    Kay says:

    @Citizen Alan:

    I keep hoping the profound disconnect will come back and bite them in the ass. How long can they persuasively present a whole theme that contradicts and/or discounts direct, lived, recent experience?

  28. 28
    beltane says:

    @schrodinger’s cat: Yes, fear of ending up like the Russian royal family did wonders to keep their greed in check somewhat. Now they feel free to run amok like a pack of wild boars.

    Here is a depressing piece on post-Democratic Europe which could just as well apply here: http://crookedtimber.org/2013/.....nd-europe/

  29. 29
    Citizen Alan says:

    @schrodinger’s cat:

    I think the threat of communism kept the worst instincts of the oligarchs in line at least in the west for most of the 20th century.

    This! The death of communism has somehow inspired capitalism to try and prove true every single thing Marx said about its failings.

  30. 30
    Joel says:

    @Kay: this is how I feel about the glib attitude towards the sequester. Unfortunately not just from conservatives.

  31. 31
    FlipYrWhig says:

    @schrodinger’s cat: There are good reasons to do things to mitigate exploding health-care costs and such. I think he’s trying to ride the “deficit reduction” horse to work on fixing Medicare and Medicaid and doing the little fixes on Social Security funding that everyone agrees need to be done but goes apeshit anytime anyone suggests touching the program at all.

    But I don’t think he believes that deficit reduction is an economic recovery plan. He made that distinction recently, and I wish he would say it more. My own political frustration is that the two keep getting mixed up, and I think Democrats and Republicans both like it to be mixed up for strategic reasons.

    (For instance, I’m convinced the only reason anyone went along with a plan to raise tax rates on anyone is because OMG Teh Skeery Defycitz! swung public opinion towards the idea that rich people should pay more towards our collective debt. That was a good outcome in macro policy terms. But it didn’t stimulate the economy or anything.)

  32. 32
    gwangung says:

    It also seems obvious to me that the 1% would benefit far more from strong economic growth than they would from cutting their income tax rates by 2 percentage points, or whatever Paul Ryan wants to do for them.

    Particularly if they’re making products aimed at the 99%.

  33. 33
    Hill Dweller says:

    @schrodinger’s cat:

    It is kinda sad that Obama has fully brought into (or else he is doing it for the consumption of VSPs) the deficit reduction claptrap, he devoted almost 20 minutes of his State of the Union speech on deficit reduction.

    In today’s press conference, the President said debt reduction alone is not an economic policy.

    PO also chided the Beltway for focusing too much on debt reduction, and not enough on jobs. He said jobs have to be our “North Star”.

  34. 34
    jl says:

    @schrodinger’s cat:

    Shlaes is a mess. Brad DeLong has written about Shlaes. Search for posts on his blog for commentary on Shlaes.
    http://delong.typepad.com/sdj/

    I am rusty on Friedman’s analysis of role of FED and monetary policy in creating downward spiral from panic if 1929 to depths of 1933, and how much current research supports it. But I’m not sure whether the macroeconomic Friedman is informative on today’s debate. There is a lot of Keynes in Friedman’s macroeconomics, which was a very different (and IMHO more respectable) effort that his libertarian schtick he did late in his life (when media celebrity might have adversely affected his judgment).

    So, as far as macroeconomic policy, Uncle Milty Friedman would be a communist dirty hippie cheap money adulterating demon minion of Nobama-ism by today’s reactionary standards. Hard to believe, but true.

  35. 35
    rikyrah says:

    you are so on point, Kay.

    thank you for posts like this.

    Henry Ford was an asshole, but he was an asshole that knew that he would make more money if the people working for him could afford what they were making.

  36. 36
    DFH no.6 says:

    @schrodinger’s cat:
    Every time I’ve discussed this with any of the many fascists I know (including my baby brother) I always ask, “What problem, exactly, is the federal debt and deficit causing right now?”

    The answer inevitably starts with something like, “Well, in the future…”

    At which point I stop them and say, “No, I didn’t ask about the future, I asked about right now. What problem do we have right now that is caused by the federal debt or deficit?”

    They can’t give an answer, because there isn’t one. Whatever problems the debt could cause (primarily forcing interest rates to rise to unhelpful levels by crowding out credit) aren’t even on the fucking horizon, and meanwhile unemployment remains high with the whole economy in low gear.

    The causes of our current economic straits have fuck-all to do with the debt or deficit.

    In fact, it’s the other goddamn way around – the large federal deficits since ’08 (and consequent increase in the debt) are themselves mostly due to the decrease in tax revenues caused by the economic downturn, which happened, of course, from the near-collapse of the financial system around the bursting real estate bubble.

    The multi-millionaires and billionaires pushing the phony “fix the debt” meme know this, and they obviously (to us here, anyway) have a very different agenda than “fixing the debt to turn the economy around”.

    Unfortunately, they seem to be winning the argument.

    It’s one of the great scams of all time, right up there with the real estate/financial system fiasco itself.

  37. 37
    bemused says:

    Thom Hartmann was just talking about a Business Insider poll reported by Common Dreams asking registered voters to choose one of three discussed budget proposals to avoid the sequester with all three proposals stripped of their partisan labels. Without identifying the party authoring the proposals or the name of the budget plan, more than half supported the plan offered by the Progressive House Dems. Even more fascinating is that a full 47% of Republicans supported the Balancing Act as much as their own party’s plan.

  38. 38
    Scamp Dog says:

    @Boots Day: I think it’s about relative, not absolute wealth. General prosperity and easy-to-find good jobs lead to things like employees who quit when you treat them badly, higher wages and similar unpleasantness.

  39. 39
    FlipYrWhig says:

    @DFH no.6:

    I always ask, “What problem, exactly, is the federal debt and deficit causing right now?” […] They can’t give an answer, because there isn’t one.

    This.

    I still think that Team Obama is trying to use a misbegotten deficit/debt conversation to work on actual long-term funding issues for the social welfare state. But I also wish they were clearer about how the deficit/debt is not the reason for a bad economy. How to handle deficit/debt is a wholly separate conversation than how to rejuvenate the economy. Far too often Democrats in general either forget, or don’t know any better, or choose not to say that.

  40. 40

    @DFH no.6: Was your brother worried about the debt when Bushie was racking it up, with his tax-cuts and misadventure in Mesopotamia.

  41. 41

    @FlipYrWhig: Obama is great orator but somehow when it comes to explaining economic issues he is not as good. I have no idea why.

  42. 42
    NonyNony says:

    @gene108:

    Politicians NEVER LEAD. They give an outlet for popular movements. LBJ pushed the Civil Rights movement into policy.

    THIS.

    Politicians don’t lead – they get PUSHED. And they don’t get pushed by petulant “if you don’t do what I want I’ll stay home and not vote next time” pushes. They get pushed by people who know how to turn the agenda into political suicide for politicians to vote against by changing popular opinion.

    And everything else you observe is correct. Socialists dropped out of economic policy arguments in the 1960s and have never come back. So the politicians we have to work with are generally liberals with a pro-corporate policy outlook who in years past (and in a sane version of the USA) would have been Republicans.

  43. 43
    Dee Loralei says:

    Kay, I’m sorry there are several parts of your article I can’t understand, at all. If you knew what now? You would have taken what as a threat? Why would you bet he doesn’t see himself as a Democrat now? The bits you are quoting sound pretty leftish to me.

    I really agree with most of what you’ve written, but I’m just dumbfounded and confused over some of it.

    And yea Hoover and Roosevelt both tried to fix the deficit at various times.

  44. 44
    ericblair says:

    @Scamp Dog:

    I think it’s about relative, not absolute wealth.

    It’s also about status and hierarchy. If you scratch down enough, a lot of the rants reduce to “the poors, blahs, and the rest of the rabble got uppity and thought they were as good as us, and now they need to suffer and learn their place.”

  45. 45
    NCSteve says:

    The difference is that our crash happened in a presidential election year and the one that started the Great Depression happened the year after a presidential election year. So basically, the nation spent the majority of first three and a half years of the Great Depression trying out the exact same policies Republicans prescribe even down unto the present day. Because a Democrat took the reigns right when the Great Recession was starting, we were able to implement at least some sensible policies that managed to put some brakes on the slide and a floor under the catastrophe.

    One of the unintended side effects of not having three and a half years of Hooverism, austerity and hand-wringing about “moral hazard” and rampant inflation right around the corner, however, was that all but a very few of the rich people got to keep their money.

    The Great Depression wiped out millionaires in job lots. And, unlike our plutocrats, many of them had the decency to hurl themselves out of their office windows. And the ones who managed to hold on to enough money to still be rich after all the paper profits went *poof* were stepping very, very carefully, because all the suffering of those first three awful years had folks just a tad riled up.

  46. 46
    a hip hop artist from Idaho (fka Bella Q) says:

    @Dee Loralei:

    Kay, I’m sorry there are several parts of your article I can’t understand, at all. If you knew what now? You would have taken what as a threat?

    The friendly emails. It’s a Woodward crying “Gene Sperling made me all askeered” reference. Totally makes no sense if you don’t know that going in. Multiple posts below on that comic interlude.

  47. 47
    kay says:

    @Dee Loralei:

    I’m sorry. It’s a Woodward reference. I don’t think he’s “a Democrar” although he’s a populist.

  48. 48
    gene108 says:

    @Kay:

    They don’t really have a unified, modern economic policy, on trade, or job growth, or any number of affirmative issues

    I think part of the problem is what was the economic consensus prior to 2008-Lehman Brothers really fell apart (understatement).

    I think there was a belief that we’d learned to manage macroeconomic issues and avoid significantly bad recessions, after inflation had been tamed in the 1980’s.

    By 2000, the federal budget was balanced, we were at full employment and had enjoyed basically 20 years of economic growth.

    Then came Bush, Jr. and his war of choice that helped boost gas prices, business greed that didn’t want to accept not getting huge returns on investments because you can’t keep high rates of growth up indefinitely and thus the housing bubble was begot and the tax cuts that ruined the fiscal well being of the country, so we didn’t feel like we had gobs of cash lying around to throw at the loss of GDP from the recession.

    I really don’t know what kind of economic policy will come up from liberals.

    I think, to some extent, we’re still picking over the ruin of the post-Lehman Brothers economy and trying to figure out what went wrong and needs to change and what changes can realistically happen in the short-run, medium-run and long-run.

  49. 49
  50. 50
    gene108 says:

    @NonyNony:

    And everything else you observe is correct. Socialists dropped out of economic policy arguments in the 1960s and have never come back. So the politicians we have to work with are generally liberals with a pro-corporate policy outlook who in years past (and in a sane version of the USA) would have been Republicans.

    I don’t know. What exactly would a socialist advocate for today in the U.S.?

    I mean global examples of socialism have failed. India tried socialism, until the country went broke in 1991.

    Capitalism has prevailed as the most successful economic model out there, along with free-trade and globalization for lifting the Third World poor out of crushing poverty.

    I think the issue in the U.S. is more of rebalancing the economic pie, than adopting a totally new way of doing things.

    Japan, Germany, Finland etc. are all capitalist pro-business societies, without the distortion in income equality, rates of poverty, etc. that are prevalent in the U.S.

  51. 51
    gene108 says:

    @schrodinger’s cat:

    Link doesn’t work.

  52. 52
    Dee Loralei says:

    @a hip hop artist from Idaho (fka Bella Q): @kay: Dear Lord do I feel dumb. I read all those threads yesterday and it did not even occur to me that is was snark about Woodward. Damn.

    All I could think was ” This doesn’t make sense. Kay always makes sense. Kay always makes more sense than any FPer here. Why isn’t Kay making sense.?” And I swear I read it like 3 times trying to figure it out.

    LOL good thing I don’t mind making an ass out of myself sometimes. I’ve had caffeine, a good night’s sleep and lunch. I can think of nothing I can do to fix my density. I’ll just have to accept that “today I’m a chocolate covered blond”, as my son sometimes says about me.

    Thanks again for the response, both of you!

  53. 53
  54. 54
    Another Halocene Human says:

    Short answer: yes. Look up “the recession within the Depression”. The “winners” (non-losers) after the Big Crash were pissed that the economy was picking up and they might lose their super-rich-dude-and-dudette privileges in a better economy (a lack of good help might be around the corner, less child labor bought with food) so they pushed back, cut down on New Deal programs which were stimulating the economy and pushed for “hard money” or “tight money” policy, causing another recession in the midst of recovery. I think basically the Fed raised interest rates while the government curtailed stimulus spending. CRUNCH.

  55. 55
    JAFD says:

    @schrodinger’s cat:

    IMHO, everybody oughta read Orwell’s _The Road to Wigan Pier_. Lots of what he said then – and of what the ‘conservatives’ of that era blathered – have been recycled without credit in the past five years, and ’tis well to know the original work.

  56. 56
    Tom Q says:

    I think (and I’ve heard Krugman say this, as well) the Obama team knows full well the austerity route is a dead end, but they also knows they’re up against 30 years of public indoctrination reinforced by personal experience (“if my household’s in financial trouble, I cut my spending”). What disappointed people here appear to want is for Obama to wage a rhetorical war to change the public view. He and his team seem to think that’s a waste of energy, that the way to go is to achieve real-world victories (as, say, they did with the stimulus) and let the public view shift over time. No one here seems to be giving credit for the way the vast portion of the public has been won over on the issue of taxing the rich — something Bill Clinton had to apologize for 20 years ago. The paradigm is shifting.

    And I think people understate how much it was ever thus, even during liberal eras. FDR/1937-38 has already been referenced, but I also recommend reading Caro’s most recent LBJ book, where he recounts how Johnson got his tax cut passed only after satisfying Harry Byrd’s committee by cutting the overall budget. Johnson — enshrined as a huge spender — said “Do it like Ike: talk conservative and spend liberal”. I don’t see why that can’t work for Obama, as well.

    l

  57. 57
    Kay says:

    @gene108:

    I think part of the problem is what was the economic consensus prior to 2008-Lehman Brothers really fell apart (understatement).
    I think there was a belief that we’d learned to manage macroeconomic issues and avoid significantly bad recessions, after inflation had been tamed in the 1980′s.
    By 2000, the federal budget was balanced, we were at full employment and had enjoyed basically 20 years of economic growth.

    I actually think it’s worse than that. I don’t even know what people mean when they say “we need a real Democrat” on economic issues (other than protecting the safety net, that part I understand).

    What kind of “real” Democrat? Carter? Clinton? On which economic issue? Trade? What’s my model? What’s the comparison? How far back are we going? I shudder a little when current Democrats talk about “retraining for green jobs” because, honestly, that makes regular people roll their eyes.

    They have been told to retrain for 20 years. A lot of them DID retrain, Clinton-era. They went from manufacturing to health care, and now health care is this huge and bloated beast that sucks up a huge portion of the money. I mean, it’ll be great to spend less on health care, I’m basically a tightwad, I’m all for it, but the huge and bloated health care beast also provides a lot of middle class jobs. What do they all retrain for after we “rein in spending” on health care?

  58. 58
    Kay says:

    @FlipYrWhig:

    (For instance, I’m convinced the only reason anyone went along with a plan to raise tax rates on anyone is because OMG Teh Skeery Defycitz! swung public opinion towards the idea that rich people should pay more towards our collective debt. That was a good outcome in macro policy terms. But it didn’t stimulate the economy or anything.)

    This is a really good point that I didn’t see at the time, but I think it makes sense. The deficit frenzy made raising taxes easier.

  59. 59
    Lurking Canadian says:

    @gene108: so what is the mystery? Why not advocate for policies like those in force in Germany and Finland?

    I don’t think anybody is advocating public ownership of the means of production or liquidation of the kulaks. There are some who oppose the presence of profits in noncompetitive sectors, and in the presence of natural monopolies , which amount to rents, but I haven’t seen anybody opposed in principle to profit since I used to hang out at alt.fan.chomsky.

    Even on the issue of free trade, on which you and I do not agree, it isn’t the presence the presence of trade I object to, just what I see as the arbitrage of labour rights.

  60. 60
    DFH no.6 says:

    @schrodinger’s cat:
    Of course my brother wasn’t worried about the debt until Obama became president – do you know any fascists who were (I don’t)?

    I love him dearly, but his worldview was sadly warped as he came of age during the misbegotten Reagan years.

    I’ve told him, “Hey, you know all those stories from history where the aristocrats and monarchs ride roughshod over the peons, and sometimes the peons fight back, but then there are these other peons who fight on the side of the aristocrats and monarchs? Well, you’re the modern version of fighting on the side of the aristocrats and monarchs, people who really don’t give two shits about you or anyone like you. And no, you’re not going to get to be an aristocrat someday yourself, either”.

    Oh, and he’s a government-employed accountant (in fact his whole career has been as a government worker, after receiving his degree from a state college, after growing up working class but comfortable because dad was a union worker) who parroted the “government doesn’t create jobs” bullshit right to my face a couple years ago.

    That was about the most spit-take statement anyone’s ever made to me, and I rained down one righteous fucking rant on him after hearing it. I don’t know how conservatives do it, but the cognitive dissonance would split my skull in half.

    We’re actually very good friends despite our political differences.

  61. 61
    ericblair says:

    @JAFD:

    IMHO, everybody oughta read Orwell’s _The Road to Wigan Pier_. Lots of what he said then – and of what the ‘conservatives’ of that era blathered – have been recycled without credit in the past five years, and ’tis well to know the original work.

    Very good and engaging book about the coal industry in northern England, and the same sort of condescending social engineering that was done with wages and social insurance benefits, along with the contempt that the ruling classes had for the workers and how hard the workers’ lives were.

    Also, as an aside, the book kicked up a huge fuss with the Soshalist reading clubs, since Orwell went on a bit about how the Soshalists’ fussing with BS theory and disengagement from the rest of society was hurting their worthy goals. Luckily we don’t have these kind of arguments, um, erp.

  62. 62
    DFH no.6 says:

    @Kay:

    They have been told to retrain for 20 years. A lot of them DID retrain… What do they all retrain for after we “rein in spending” on health care?

    You know, Kay, that’s a very good question. One of the most important questions out there for our civilization, in fact.

    IMAO, we’ve arrived at the point (in the “First World” anyway) where we simply don’t need everyone (or even close to everyone) to work in order to provide all of modern life’s commodities and services.

    That’s a huge conundrum and challenge.

    Other than the unmatched challenge of global warming (about which I am not sanguine at all) it’s as large and systemic an issue as we have.

    I hope “what the hell does everyone do for a living?” is not made entirely moot someday by global warming catastrophes, but I fear that likely will be our future some decades hence.

    And on that cheery note…

  63. 63
    ThatLeftTurnInABQ says:

    @DFH no.6:

    IMAO, we’ve arrived at the point (in the “First World” anyway) where we simply don’t need everyone (or even close to everyone) to work in order to provide all of modern life’s commodities and services.

    I disagree. If our economy was sealed behind high tariff barriers like back during the late 19th Cen., we would need nearly full domestic employment to produce all of that stuff (which is why I highlighted your qualifying phrase above).

    Structural unemployment in the US today is largely the result of exposing workers in a First World economy to direct competition from Third World labor pools rather than trying to protect them. Even if this has beneficial macroeconomic effects at the national level, note how the benefits and woes of globalization have not been evenly distributed within the nation, mostly as a function of socioeconomic class.

    Also, if we are going to draw contrasts between the US and Germany, note which country does a better job of protecting its domestic workforce from the worst effects of globalization.

  64. 64
    James E. Powell says:

    First, I don’t think we ought to be calling it the Great Recession. Nothing great about it. For historical accuracy, we ought to call it the Bush Recession.

    Second, we should never forget that one of the most important things that happened was that, in an honored American tradition, a large number of Americans, mostly white working & middle class completely ignored the rich bastards and Republican big shots who brought about the Bush Recession and focused their anger on the non-whites. Also too, any government employee or union member who managed to hang onto a job was an acceptable target of rage and political attacks.

    The ruling class needed to escape the blame for what happened. They pulled it off beautifully. They are the only ones who were not harmed by the Bush Recession.

  65. 65
    RHytonen says:

    @Kay: @Ted & Hellen:

    “What kind of “real” Democrat? Carter? Clinton?”

    Eisenhower.

  66. 66
    mclaren says:

    No, Kay, what America is going through now politically is very different from happened in the Great Depression after 1932.

    And there’s a good reason why things are different now.

    Herbert Hoover and his sociopath Secretary of the Treasury Andrew Mellon basically tried the current Republican response to the economic collapse — slash government funding, cut programs, shut it all down. And unemployment skyrocketed to somewhere north of 35%.

    Things got so bad by 1932 that one voter in that election said, “If Franklin Delano Roosevelt is not the next president of the United States, there will not be a president of the United States.” People were on the edge of revolution.

    Because things got so bad in the three years leading up to the November 1932 elections, tremendous social pressure built up for reform. As a result, when FDR got elected, the Wall Street thieves got tried and convicted and sent to pound-me-in-the-ass prison. Major substantive reforms (like the Glass-Steagall Act and the FDIC) were passed to fix the corrupt broken banking and securities industries.

    By comparison, in 2009 the U.S. government swiftly passed a huge stimulus bill, averting the kind of catastrophic 35%-plus unemployment and complete industrial collapse we got in the original Great Depression. That’s the good news. The bad news? The stimulus bills passed in 2009 prevented the kind of unenedurable economic pain that would have forced a general public call for genuine deep reform of Wall Street and the banking system and the corrupt Washington D.C. system.

  67. 67
    mclaren says:

    @ThatLeftTurnInABQ:

    All excellent points. The problem with sealing your country off behind a high tariff wall, however, is that imported goods like iPods and iPads becomes fabulously expensive.

    Alas, America no longer has the industrial capacity to manufacture iPods or iPads. We literally can’t make them here in the U.S. We lack the technology, we lack the expertise, and we lack the manufacturing facilities.

    So it’s a Catch-22. We can either have high employement in America with no iPods or iPads or Wiis or laptops or high-quality cars, etc… Or we can have low employment with lots of cheap fabulous electronic toys and great-quality foreign made cars.

  68. 68
    mclaren says:

    @schrodinger’s cat:

    It is kinda sad that Obama has fully bought into (or else he is doing it for the consumption of VSPs) the deficit reduction claptrap, he devoted almost 20 minutes of his State of the Union speech on deficit reduction.

    Obama has lots of good qualities. Unfortunately, even a rudimentary knowledge of basic economics is not one of them.

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