Tag Archives: Financial Crisis

After the flood.

With an environmental disaster underway in Houston and massive destruction in the Florida Keys, the Virgin Islands, and elsewhere around the Caribbean, it’s fair to say that the 2017 hurricane season is off to an inauspicious start. We are completely unprepared for these climate change-fueled super storms, largely because we find ourselves unable to grapple with the fact that global warming is actually happening. Yes, I know – no storm can be directly attributed to climate change, but it does enhance the strength and volatility of the storms to a significant degree, and the effects are very much as predicted by climate scientists.

It's getting worse, folks.There are people in this country – coastal urban mayors and the like – who have to face facts on this issue, but pretty much everyone else is free to ignore the obvious: that we are now living in a far more dangerous and unstable environment, and it’s only going to get worse. The longer we play this denial game and pretend it doesn’t exist, the more profound the long term costs will be. Unfortunately, this is a difficult issue to get traction on in a country like the United States. You find yourself arguing for a major change in people’s day-to-day lives, tremendous investments, and more, for positive effects that likely won’t become evident for another generation or more. It’s a crisis that breeds fatalism, and that plays right into the hands of the petrochemical-driven profit machine that’s been stoking climate change for decades.

I think the only way we can succeed in convincing enough of our fellow Americans that radical change is needed is by decoupling the notion of a sustainable society from economic austerity. We have demonstrated this as a society – recall the period just prior to the financial crisis of 2008 (well, before the election of 2008, too). There was what seemed like a broad and growing consensus that we needed to do something about energy use, investing in renewables, greater efficiency, etc. The crash just washed that all away in a chorus of “drill, baby, drill!” When you have 750,000 people a month being tossed out of work, people will grasp at anything, and Obama did little to articulate a coherent vision of a more sustainable economy.

So here we are, being battered by ever larger and more menacing storms, and yet building more pipelines as far as the eye can see. We need to move the conversation back to where it was ten years ago (and further, really). That’s the straw.

luv u,

jp

Fear itself (again).

These grim days remind me a bit of the far worse days of late 2001, when our nation was reeling from the 9/11 terror attacks and the world seemed to be falling in on itself. (It happened that my family life was imploding at the same time, but that’s another story.) I guess what reminds me most of that time is the visceral fear evident not only in mass media culture but in everyday life. People are scared, very scared about some relatively minor threats, while at the same time seemingly unconcerned about the real dangers facing us.

Year 2 of the Romney foreign policyThis is a cultivated disconnect, certainly no accident. Every day, the news media hammer away at the threat of Ebola, of ISIS, of Russia, and to a lesser extent North Korea and Iran. In the case of the former, we’re reaching a near hysteria about a virus that has affected only a handful of Americans, and only three cases in the U.S. The public has been worked up into such a lather that politicians are falling over themselves to try to benefit from it, take advantage of it, channel it in some way that is useful to them. One only wishes we could evoke this sort of reaction on actual threats, like our disastrous automotive transportation system that kills over 30,000 of us a year.

I only raise that particular example because it’s the 24th anniversary of my brother’s death behind the wheel of a crappy, very common unsafe-at-any-speed vehicle. There are far greater threats, though – those of climate change and of nuclear war, for instance. The former we cannot bring ourselves to seriously address; the latter we have discounted and essentially forgotten, unless our attention is turned to an official enemy, like Iran or North Korea. If our news media were reporting on these issues the way they report on a hemorrhagic African virus that’s not half as contagious as the flu, we might ultimately feel motivated to do something about them. So far, no potato.

We are probably the most fearful people ever to run an empire. It’s something we need to overcome, so that we can arrive at the kind of clarity we need to see what actually confronts us.

luv u,

jp

Austeritarianism.

The international consensus on forced austerity was soundly rejected this past week in both Greece and France. That’s what happens when you let people speak their minds – they sometimes opt for inconvenient solutions. As much as I love Jon Stewart, even he got this one wrong – the Greeks are not political confusniks addicted to cradle-to-grave government benefits. Their financial train wreck is as much a function of wealth privilege over there as it is over here. When they went to the polls this past weekend, they chose the parties that opposed the Euro zone plan, both on the left and the right. That’s not surprising; the bailout basically benefits that country’s financial sector, at the cost of Greek workers. There have always been political groupings on the extreme left and right in Greece, so everyone went for the candidates who (a.) opposed the bailout and (b.) aligned with them politically, generally speaking.

The bankruptcy of what Greek and French voters rejected couldn’t be more obvious. Greece has gone through several cycles of austerity-driven budget cuts, massive layoffs, rate hikes, etc., and the result has been the same. Step 1: You cut budgets, you throw government workers out on the street, and there’s less money in the economy. Step 2: Lower aggregate earnings and consumer spending means less revenue into the government, which in turn widens the budget deficit. Step 3: The Eurozone demands more cuts.  Step 4:  see Step 1. Mix and repeat. Can you say “death spiral”? This is, in essence, what is happening in England and in the United States in slightly less dramatic fashion, though on a much grander scale since their economies are so much larger than Greece’s.

So… the people have spoken. And the markets are reacting. Not real fond of democracy, the investment community. It involves way too much uncertainty. The fact is, they are grappling with many of the same problems that are plaguing us. We had an overinflated housing market, blown up even further by derivatives speculation, then when the whole house of cards came crashing down, our deeply deregulated banking system left some of our largest financial institutions almost fatally exposed. Their crisis was in part precipitated by ours, but because they have a monetary union and not a political union, it seems like 20-odd different crises rather than one big conglomerated one. And just as austerity is lengthening the depression (yes, depression – ask Krugman) over here, it will bring only misery to the continent as well.

This system is obviously broken. Cutting spending may serve other political ends, but it will not fix the problem.

luv u,

jp