Let’s pretend for a moment that reality doesn’t exist. That effect doesn’t follow cause. That reason is simply an “alternative” approach to how the world works. That everything means nothing. And that history is useless. If any of this sounds like the way people think today about money, the government and their lives, then maybe that’s all we need to construct a non-housing-market-based theory of why stock markets are crashing worldwide.
So let’s at least be fair and stop blaming it on the real estate and mortgage industry.
If – as nearly a century after the Great Depression reality-denying generations of Americans have taken us to the brink – it turns out that reality doesn’t actually exist, then maybe the credit market crisis doesn’t exist either? How can it be that I was the tenth person in line at Starbucks this morning for $4 coffee when everyone is supposed to be broke? Why isn’t there a parking spot up front – or even in the first lot – at the mall? Who at Bank of America sent me the “PreQualified” application for an unsecured loan in the mail this morning? And why did this ad appear at the bottom of the same page on the Wall Street Journal website just moments ago when the DOW as down 400 points:
Of course, if there is no cause-and-effect, then lending to borrowers without doing a credit check is not related at all to their ability to repay – or their propensity to default. No different – in theory – than Barney Frank saying he’d “like to roll the dice a little more” with Fannie and Freddie’s scheme to lend to marginal borrowers having no connection to the destruction of Lehman or Merrill or Indy Mac. The prevailing theory of the crisis – that it was Wall Street “greed” – doesn’t make sense either. If Wall Street was really so greedy, wouldn’t it have been hoarding its money and not risking it by loaning to “Ma and Pa Main Street” that CNN so dutifully continues to show us crying on our television screens? Isn’t greed about making money, not going bankrupt?
If everything means nothing, then history is a useless guide to solving this crisis, too. The Treasury – in its series of range-of-the-moment thinking – doesn’t even realize it’s repeating the exact playbook of Herbert Hoover’s crisis exacerbation strategy from the 1930s. Since there is no connection between profits and risks, freezing short-sales for a couple of weeks shouldn’t have harmed the market – nor could it have been connected to the 500 point drop in the market on the day trading stolen authority was returned to the brokers. Hoover tried that – and nobody noticed that he got the very same results back then – because history is meaningless, not just unknown to today’s politicians.
With generations of citizens raised on political bombast and trite phrases substitute for thinking, it stands to (reason?) that, since we have “nothing to fear but fear itself,” we should have nothing to worry about than worry itself. That, certainly, is about the only lesson we can learn (passing through our short-term memories) when we watch a Presidential debate of fourth-grade caliber – filled with pithy maxims of short-range vote-grubbing cynicism. Yet there can be no fear or worry: Presidential elections are likewise meaningless to an electorate that knows more about the comedic-spoof of the debate than the actual event.
The alternate theory of everything – that nothing exists, that everything is “equally” good and we should all just get along (in our free housing units) until we are put on the Government feeding tubes in our old age – is being put to the test. America’s century of intellectual capriciousness – born a century earlier of Immanuel Kant, picked up and inculcated into our children by John Dewey and forced into our politics by FDR’s court-packing takeover of the Constitution – now demands payment. Decades of college professors deconstructing our history, our economy and our minds have left us with leaders with no thoughts: not even a fuzzy recollection of basic civics class where someone once mentioned personal responsibility.
Today’s economic crisis isn’t the cause of our civilization’s collapse; it’s just a symptom of it. People don’t just “lose confidence” in their institutions and neighbors overnight. Congressional approval ratings have been lower than support for death-row criminals for decades. Voter turnout is lower in the U.S. than it is in Iraq. Two generations – X and Y – openly expect never to see their Social Security dollars once their locust-parents suck dry the feeding tubes of Government waste. And everyone stands two-hundred deep in security lines at airport where nothing had run on time for fifty years.
In times of crisis, villains are always lurking everywhere. The perpetual criminal is always the businessman – the devious real estate broker, the greedy loan sharks, the multinational conglomerate. No word is ever mentioned of the willing customers who lined up at their offices, sent there by political patronage, funded by central bankers – who demanded their government-guaranteed right to a four bedroom, three bath home that was their birthright. Who could blame them?
What would Jefferson say?
After a century of intellectual corruption, where “nothing works” became the standard not the exception, can anyone really protest that the markets have finally broken down as well?