March 24, 2008
Column: Campaign silence over Wall St woes
The separation of presidential politics from the troubles assailing the US economy is now verging on the surreal. With banks collapsing, the dollar reeling, the Federal Reserve making up new rules as it goes and observers discussing a new Great Depression, the presidential candidates are still on scripts they wrote a year ago. The main problem is either the North American Free Trade Agreement (Barack Obama and Hillary Clinton) or high taxes and excessive regulation (John McCain). If delivery from this ordeal depended on any of the contenders saying something intelligent about it, prudence would require that the entire country be written down to a nominal sum.
What makes this even odder is that the Democrats, at least, continue to hammer away at economic anxiety. The squeeze on “middle-class families” gives them an edge against the Republicans in November, they calculate. But they were saying this last year, and the year before – when unemployment was not rising, the economy looked pretty healthy and most Americans still did not know the difference between an SIV and a CDO. The themes are trade and jobs, shuttered factories, stagnant incomes, unlevel playing fields and labour and environmental standards. As for the complete breakdown of the credit system and the danger of a years-long Japanese-style slump – oh, yes, there’s that as well.
The remainder of this column can be read here. Please post comments below.
Excellent piece and much-needed wake up call to the respective campaigns. Sadly, their hesitation to speak out reflects the knowledge of many key economists on their respective teams as to how deep and profound the crisis is for the US. Gillian Tett and Wolfgang Münchau pieces in today’s paper are good starting points for some tough questions that must be addressed.
Nonetheless, mediatised US political noise is a risk (and a waste of time) for us all. The campaign debate needs to pass on critiquing the failed analysis and responses of the Bush Admin and the Federal Reserve over a period that arguably spans well back into the early (pre-Rubin) Clinton-Greenspan years. They simply need to define their current take on “the new reality” facing the US in 2009.
Posted by: WCM | March 24th, 2008 at 10:21 am | Report this commentThis is not a big surprise, the major corporate donor to all of the campaigns is Wall Street. See www.opensecrets.org (Center for Responsible Poltics) for an account. American Candidates will bite the business hands that feed them at their peril. There is no other planning support for the campaigns or US government for that matter than the large corporations, hence candidate don’t have a choice. The campaign finance problem is easily fixed with political will. Its the political will thats a problem. But this is another long post to explain
Posted by: Michael Cohen | March 31st, 2008 at 11:37 pm | Report this comment