The Danger Zone

Not many of us can understand in detail how to solve this economic crisis right now, and we depend on people we trust to do the right thing. So let's say they are right, that some sort of action is necessary immediately to prevent what everybody is calling an economic meltdown, which sooner rather than later would result in Great Depression II. And let's say that it involves the government intervening with lots of money that might all disappear, leaving a huge bill for taxpayers.

Now there is less agreement on this than there was a couple of days ago, but still, even critics of what's been proposed--like Paul Krugman of the NY Times--say that some major government action is required, soon. The reason, according to Barack Obama, is to "maintain liquidity," which means, among other things, the ability of businesses, large and small, to borrow money even for a short time, to meet payrolls, buy supplies, perform maintenance, and meet other costs of doing business. Beyond that, it means investment borrowing to expand, to start new businesses to employ people.

The first proposal by Bush Secretary of the Treasury Paulson was stunning in its oversimplification and the sweep of the power he wanted to grant to himself, completely unreviewable by courts, unsupervised by anyone else. That overreaching made everyone stop and look at other deficiencies: the need to support home buyers and prevent foreclosures, the need for transparency, accountability, and the need to not reward the businesses and the executives who screwed up so royally in the first place.

While those debates go on, ordinary Americans have responded from the heart. After all these years of being told that we can't build or repair infrastructure, we can't have affordable and universal health care, we can't lower middle class taxes, we can't support the next generation of clean energy technology that is our best investment for the jobs of the future, we can't even help our fellow citizens in need even in emergencies like Katrina--because we don't have the money. Now we're told that we have to potentially throw away as much money as we've already wasted on a useless, needless destructive war in Iraq. We have money to buy up companies that through unrestricted greed have brought our entire economy to the brink of collapse. And probably hire the CEOs of those companies to help figure out what to do with them.

The stories online with comments and the blogs, as well as columns in newspapers, there is a theme: if you're bailing out Wall Street, what about me? I have a little business that could use such a small piece of that $700 billion that you wouldn't miss it. How about bailing out my balloon payment on that mortgage I was fraudulently suckered into? How about paying those predatory credit cards? Or this woman: Dear Mr. Paulson: "I know you are busy bailing out financial institutions but if you have a minute I was wondering if you could loan me $3000.00 I haven't been able to afford health insurance for years and would love to get a mammogram."

While this Secretary of the Treasury is, as they say, the only one we've got, and so some deference is due him, his own background and acuity in these matters is suspect. But the even bigger problem is who he works for. We're being asked to trust the administration that has brought us Iraq, Katrina, the Patriot Act, Guantanamo, Abu Ghraib, the rule of Blackwater and other mercenaries, the gutting of the Constitution and the Courts, the stripping of professionalism from every department of government, beginning with Justice; rampant corruption in the Interior Dept. and elsewhere; a war on science that doesn't benefit oil companies, huge tax cuts for the very wealthy and decimation of the middle class, the outsourcing of our remaining productive capacity, and this very economic crisis.

This is the administration of a president whose approval rating hit 19% today, and nobody noticed. His rating for handling the economy is 17%. It used to be said that if Bush announced that he was Satan, he would still get a 30% approval. Now he's got the support of fewer than 1 of 5 Americans. At best, he is the lamest lame duck in history. But that's still his Treasury Secretary.

Americans haven't seen many effects of this crisis yet. But they will. Senator Bob Casey made an acute observation to salon: "The magnitude of what happened on Wall Street is hard for anyone to absorb. Maybe it hasn't fully sunk in because the image of real economic calamity is so based on the 1920s and the Depression. Maybe things will change as people begin to look at what has happened to their retirement accounts over the next few weeks."

And when people do begin to realize the extent of this, then the real danger begins, especially if a bipartisan plan is not in place and already showing signs of working. We're going to be in uncharted territory.

But crisis is also opportunity--not only for the unscrupulous this time. Barack Obama is making a consistent argument that suddenly makes sense as not only a vision of hope but the best way forward: change the emphasis from supporting the wealthy, globalized corporations and Wall Street, to supporting workers and small business, with support for housing and credit problems, but more broadly, support for universal health care (which is a huge cost for families and businesses, and an enormous drag on the economy), education (to compete for better jobs, to have better lives), and for community. It means incentives to keep and encourage good jobs in America, not the previous emphasis on supporting global corporations in their never-ending quest to find the cheapest labor. Suddenly the "change from the bottom up" philosophy of his politics becomes more clearly an economic vision.

That support also means new productive enterprises, an America that builds things again, and the growth opportunity is clean energy technology, retrofitting, infrastructure for the new reality of less dependence on oil and the changes needed to save the planet from the global heating that is the ultimate economy (and life) destroyer.

This is the way to a better future, that can begin in November if Americans make the right choice. And that may depend on how we navigate this danger zone between now and then.