We do not have a "broke" economy. Our house has been burgled, from inside. All our intelligence, information and good humor remain available to us. We can use what we have to refill the house, looted as it may be.
Remember the "Peace Premium" and the budget surpluses set up after the Carter and Clinton Administrations?
In eight years, Reagan managed to convert the world's largest creditor nation into the world's largest debtor nation, with virtually nothing to show for it. We bought B1 bombers and Space War systems which do not work and cannot be built, and Polaris submarines with nuclear weapons which cannot be used.
In eight years, Bush Jr managed to appoint people who despise "government" and had no experience with large organizations (public or private) into positions of authority, doing nothing. The people in charge of the SEC (under Orange County's politician, Cox!) devoted their entire working days in the entire year of 2008 to collecting pornography. Apparently they believed it was not necessary to glance occasionally at the nonproductive re-tranching of low-risk mortgages into high-risk securities which could be used by predators to bet against in forms of credit default swaps which had been illegal since the Great Depression, but which were made available once again by a Congress owned by the Lending Industry.
Now, the people who own this country--having seized most of its real estate in foreclosure and shipped most of the industrial capacity off-shore--have frozen credit and refuse to make loans. This leaves any possible "recovery" at a stand-still, and they know it. They want to find another empty suit to run as President so they can take back that branch of government which they lost. The surest and really at this point only viable way to pull this off in 2012 is simply continue to refuse to make sensible old-fashioned secured loans to small business, which has always been the fastest, surest, most reliable engine of recovery. The Lenders can put anyone they want up for President, and the voters will vote against all incumbents because "it's the economy".
Is the Lending Industry making loans to the middle class? No. Why not? This is the same group of people who created the financial crisis by making highly leveraged high risk investments in which they lost their shirts, in which the CEOs destroyed the institutions they were managing, only to turn to taxpayers and, during the Bush Administration (we have to remember this little detail), extorted a bail out to the tune of TRILLIONS of dollars. Remember, the Lenders got this bail out with the "promise" they would then loosen up credit and have it to make available to borrowers and business once again. They did not do this, in spite of being GIVEN the money and having made that solemn promise.
So, here we are waiting for the benefit, the loan availability accommodated by the tax payers' cash through the banks...and we are still waiting. It simply looks like the predators, having given themselves additional commissions and billion-dollar bonuses AGAIN as a result of taking tax payer bail-out money, are once AGAIN looting the country.
The good news is that at some point, the middle class, or you or I, or even some civic authority that has not already handed all of its collection to a predator, will set up a new, fresh and actual, "bank". This new bank will loan money to the middle class. The producers will get back to work producing value. And rapidly, and surely -- nothing miraculous or remarkable about it -- the whole country and the world will start to enjoy prosperity and good business.
Of course, bear in mind that the Lending Industry is still huge, and they own everything and they do not want this to happen -- because we have elections coming up, and they badly want to put another tranche of empty suits into Congress and the Executive Branch. The same people who stole our infrastructure also own our media, including the blogosphere and the twittering venues. They overwhelm us with their naysayings and attacks, without offering solutions or even mentioning implementation.
Kotlikoff is simply one of these Voices of Dooooooom. Where was he when the bankers were earning billion-dollar bonuses to perform non-productive conversions of wealth into air? Where was he when banks became bingo parlors, gambling our pension funds into toxic dumps? What possible insight does this obviously blinded and blinkered man have for us now when we need ... real insight?
For that matter, where did Kotlikoff just now get this expertise on "bankruptcy"? Where was he when the Lending Industry fought against bankruptcy reform and left consumers trapped in nondischargeable credit card schemes that treble the cost of purchases? Where was he when the bankers systemmatically went after municipalities and States and drew the entire country down into a spiral of debt? A million towns are now "bankrupt"!
If we stopped paying bankers enormous amounts of money to steal from the public weal, or stopped rewarding CEO's who destroy their own companies -- these are extraordinary times -- the engine of recovery can rapidly turn on.
Within a few months, think "over-nite", people could be hired to rebuild the infrastructure which has been completely ignored for the previous 8 years. We need engineers and designers. We need scientists to engage the stem cell, solar, and toxic clean up industries which are so promising. These would not be the low-wage jobs offered by the lame "tourist" hotels and patronizing "service" industries so eagerly touted by well, Las Vegas style cities.
The solution, in sum: Loans should be made available -- obviously not from the bailed out predator banks -- they simply refuse and will continue to withhold money in order to kill the recovery which they do not want. Go to credit unions and small banks. Start a bank on your own. Loan to small businesses, using traditional collateral. Multiply. Ignore the fact that the headlines continue to scream "Greece" and "distress". In the history of economics, business profits have never been bigger. There is plenty of money. Vast treasures were not actually destroyed. Just...stop giving it to predators. Stop.
And stop electing empty suits into positions of authority. We will prosper. Good health will break out like a pandemic. Intelligent people are much more fun than the hate-mongering little bashers who are confused and baffled by this utterly natural world.
- Did Socrates say "Know Thyself", or was he misunderstood, as all are. Show Thyself is all we can do. The knowing is unknowable. I am filled with joy. It can't be helped.
Became a Farmer, Builder, Musician, Tank Commander, Librarian, Lawyer and Minister. I have failed at many things. And now retired. Filled, just filled, with Joy.