Wednesday, October 21, 2009

For everything to stay the same, everything must change ...

Not even. Things have just stayed the same really. The crisis is over and everyone can continue on. Just as it ever was. Indeed.

But really what has changed also rings true when we consider whether the fundamental problems have gone away. While I've focused on financial vulnerabilities, it's also important to point out social vulnerabilities.
This is more true for the US than for Australia, with its continuing belief that if you treat money well, it will spread itself all over town. Yeh right.

Bob Herbert has been writing about these things for a long time, scandalised by the inequalities in the US political economy. And never more than now.

See Safety Nets for the Rich

We’ve spent the last few decades shoveling money at the rich like there was no tomorrow. We abandoned the poor, put an economic stranglehold on the middle class and all but bankrupted the federal government — while giving the banks and megacorporations and the rest of the swells at the top of the economic pyramid just about everything they’ve wanted.
And we still don’t seem to have learned the proper lessons. We’ve allowed so many people to fall into the terrible abyss of unemployment that no one — not the Obama administration, not the labor unions and most certainly no one in the Republican Party — has a clue about how to put them back to work.
Meanwhile, Wall Street is living it up. I’m amazed at how passive the population has remained in the face of this sustained outrage.
We need to make some fundamental changes in the way we do things in this country. The gamblers and con artists of the financial sector, the very same clowns who did so much to bring the economy down in the first place, are howling self-righteously over the prospect of regulations aimed at curbing the worst aspects of their excessively risky behavior and preventing them from causing yet another economic meltdown.
We should be going even further. We’ve institutionalized the idea that there are firms that are too big to fail and, therefore, “we, the people” are obliged to see that they don’t — even if that means bankrupting the national treasury and undermining the living standards of ordinary people. What sense does that make?
If some company is too big to fail, then it’s too big to exist. Break it up.
Another NYT report "Study Says Reporting on Economy Was Narrow" reveals how reporting on the economy fails to focus on the plight of the poor. Instead it focuses on Wall ST, government and a few big stories. The Pew Research Centre does excellent surveys on a variety of issues (it does an excellent one on global attitudes towards  the US).

Reviewing almost 10,000 reports from Feb. 1 to Aug. 31 in newspapers, on news Web sites, on the radio and on network broadcast and cable television, Pew found that almost 40 percent of economic news reports dealt with the trials of the banking and auto industries, and the federal stimulus bill passed in February.
Unemployment and the housing crisis accounted for 12 percent. And, the study said, “stories that tried to explicitly examine the broader impact of the economic downturn on the lives of ordinary Americans filled 5 percent of the economic coverage.”
Three-quarters of the reports originated from Washington or New York, and a similar number were based on the actions of government and business leaders.
In February and March, the economy was the subject of nearly half of all news coverage, driven mostly by the stimulus bill and the uses of bank bailout money. After those fights died down, financial news coverage fell by more than half.

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