That nudge of history reminds this writer of Ronnie Reagan who during his eight year White House sleepover was completely without short and long term memory because of degenerative dementia. Understanding the modern art of economics requires a quick wit and a profound memory. To help the old guy think more clearly, Reagan's handlers called up a muse and monetarist from Chicago named Milton Friedman. Note that the term "monetarist" signifies a base interest in all things banking. Just like Harriet Martineau, Friedman listened to some mentor Malthus through a horn vaguely and wrote it all down for the reverent press and republican sycophants. Ronnie and all the Reaganistes declared that a fanatical "Trickle Down" doctrine was the new apotheosis forever and ever for the entire economy of our great nation. Kaiser Ronnie and his rightwing gang practically canonized Friedman. And the Marine Band seductively played "Hail To The Chief" as the chauvinistic, amnesic media all jumped on the wagon.
Now three decades later, Bennie Bernanke sounds a lot like Ronnie Reagan. But Bennie knows his math and he can remember most things it seems. So maybe Bennie is like Ronnie and he is unable to hear the cries of the regular people out there in fields and in what's left of their factories. Last night on CBS Sixty Minutes show Bernanke said:
"The unemployment rate is just not going down … unemployment is just about the same as it was in mid 2009 when the economy started growing, And it looks that at current rates that it may take some years before the unemployment rate is back down to more normal levels. ... At the rate we are going it could be four or five years before we are back to a more normal unemployed net rate, somewhere in the vicinity of say five or six percent."
What's wrong here? The problem is that the Fed and the White House under both Bush and Obama decided to bail out and protect all the guys on Wall Street and the giant banks like Bank of America and Citi and Chase and Wells Fargo. Remember that it is rarely stated but the real reason that Merrill Lynch was taken over by Bank of America was to speed up and lubricate the lending of money to the failing stock broker. In essence Merrill Lynch became a bank under the US Federal Reserve system. Some estimates set the cost of the bank bail out at four trillion dollars.
Helping all those huge financial corporations avoid going belly up was good. But here's the real Bad, Big Problem with all of that: They should have bailed out the regular working people first. How? The government should have spent the four trillion dollars on a massive infrastructure program across the nation. That way people can get back to work much quicker than what is happening. Give the people a paycheck. Let them build high speed rail and subways and fix the potholes and build wind generators and solar power stations and on and on. This is not to forget or diminish the automotive industry bailout that is still an ongoing good solution. It made jobs and not just spurts of consumption.
Give a guy a fish, and he can eat for a day. Give a guy a fishing pole and line, and he can eat until the fish stop biting. Give the nation some tools and some infrastructure and the economy can grow for a long, long time.
But the sad truth of our economic problems is that the Giant Banks sit on their money while their CEOs and Chairmen decide exactly how to divvy up their windfalls from the US Treasury and the Federal Reserve Bank. Warren Buffett needs more donuts for his Gulfstream Netjet and the B of A CEO Kenneth Lewis needs more lounge chairs at his place in Florida.
The banks are not our friends. They are essentially our enemies. We must stop throwing money at them hoping the multiplier effect will give us a new job. This is nuts. This is backwards. The media blitz we endure constantly from the banks is enough to indicate that there is a lie within their media massages.
Have not regular citizens the ability to raise the economy? Give them a chance and they will. The banks don't give a spit in the ocean about the regular people of America. The big banks are corporations. Businesses. They want to make a lot of money. They make their money on the backs of regular people of the USA. It is time to reverse the way the government has financed the financials.
