Saturday, September 13, 2008

The NeoCon Economic Pilot Test Failed

Whatever else it is, the Bush economy is unarguably Milton Friedman's "free" market theory in application. And it is a collosal, catastrophic failure.

The wreckage is strewn from one coast to the other and from Gulf to Great Lakes. Bodies lie everywhere.

I've lost count of the number of Wall Street tyrannosauri that have died, are dying, or were rescued. (It seems that the "free" market is "free" except when it isn't "free.")

We're still waiting the count of foreclosed homes.

The stock market teeters perilously, disastrously for Boomers with little hope of ever making up the losses incurred while Bush has been in office.

Oil prices are in the stratosphere, dragging the prices of everything else along for the ride.

Equity in a home that has lost half its value is half the equity--a crippling blow for everyone, but especially debilitating for those who are retiring or need to finance assisted living through the sale of their homes. That would be everybody I know. What about you?

Yesterday afternoon, I heard MSNBC's David Schuster interview an American Spectator editor on the foreclosure crisis. Incredibly, the editor--I didn't catch his name--said that the foreclosure crisis wasn't the result of deregulation. It was the result of the socialist expectations of buyers, he said, who knew they'd be bailed out.

Well, ain't that just a Republican NeoCon for ya? I didn't get a chance to cross-examine him myself, but if I had, here's what I'd have asked him. Do you have any data on that? Can you show us the lending houses' marketing materials that promised a bail-out to an oversold buyer? Any examples? Anyone? If that's the case, why aren't there national foreclosure crises twice a year? I mean, consumers have been consuming homes for quite a while now. And, how's that expectation working out for the "socialists"?

Such a lot of lies.

The truth, of course, is that the steady dismantling of banking and lending regulations, including repeal of New Deal jewel Glass-Steagall (pushed through when Clinton was President and hostage to a GOP-dominated Congress), is exactly what caused the foreclosure pig wallow. (If you've nothing better to do, search the New York Times using "Glass-Steagall" or "banking deregulation." It's an interesting historical flashback.)

Actually, there's a fine (and readable) article about the causal connection between both W's deregulation and--heads up--the economic legislative policy of John McCain's chief economics advisor Phil Gramm to the foreclosure crisis. It's worth your time.

Honey, trust me. You don't want Phil Gramm anywhere near the country's economic policy. Didn't you learn anything from George W. Bush?

Next time you hear a conservative blame the people for the foreclosure crisis, ask him this: "Did you REALLY read EVERY SINGLE WORD in the stack of papers you had to sign for every one of your mortgages?"

I didn't think so. You just trusted your realtor and your mortgage broker, didn't you.