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Riding The Economic Roller-Coaster: The Big Plunge Is Just Up Ahead
In what at times has sounded like a script from Sesame Street, pundits and economists have endlessly engaged in speculating about whether the recession looks like the warm and fuzzy Letter U, the nasty Letter V, the even nastier Letter W, the crazy Letter X, or the dreaded Letter L. It's enough to make you swear off Alphabet Soup forever.
Call me illiterate, but I think we're barking up the wrong analogy, what we've got looks more like a roller coaster from where I sit. Think about it: the most terrifying ride in the park-you go up a little and then down, your heart lands in your stomach and you're afraid you're going to upchuck all over your date but then you realize that you survived and it isn't so bad and hey you're going up again. And then you get to the top of the next rise and see the very long and steep decline that lies ahead...
I'm no economist, but while the Cash for Clunkers program certainly helped lower car inventories and upped the average mpg of the cars on the road a tad, only 41% of the cars bought under the program were American and hey did you know that the payments are taxable? Much more importantly, none of this does jack to reform our transportation policy. So now that the program is over, how long does the economic honeymoon continue? And when does an understanding of peak oil temper our Detroit at any cost mantra?
Then there is the money laundering bailout of the banks and insurance companies. Stockholders got stuck in the hot water spin cycle where their money shrank the big one leading a panicked Congress to shovel enormous amounts of money at these companies with shockingly little oversight or regulation. We don't even know how the money was used or where it all went. And funny story, those companies that were about to plunge into the abyss and take us with them-stock prices are back up, and the CEO's are doing quite nicely, thank you. And what exactly has been done to insure that it doesn't happen again?
As for the foreclosure crisis-that nasty little house of cards seems to have eased. Or not. Seems there are some mortgages called Option ARMs about 70% of which will reset before 2011, some by as much as 63% leaving a whole lot more people with not much of an option but to go into foreclosure, so that one isn't over yet either.
Those factors, and throw in the health care debacle and unemployment while we're at it, are enough to say we've still got a problem but our current economic woes are only the tip of the not so proverbial iceberg. Which happens to be melting. And quickly at that.
Our national self-centered myopia when it comes to climate change and environmental peril is blinding us to the inevitable, drastic changes ahead. In the face of incontrovertible evidence to the contrary, we believe there is such a thing as clean coal and safe nuclear energy, we blithely use pesticides and herbicides on our land and then drink them from our rivers. We poison our air and imperil our food supply by genetically modifying it and then go back to watching Mad Men or American Idol without a minute of my bad or wondering about the consequences and cost of this folly.
And costly it will be. As the healthcare ‘reform' debate has made all too clear, we have incorporated our democracy to the point where the welfare of huge corporations is considered at least if not more important than the welfare and health of the people they supposedly serve. The same is even more true of the energy and global warming debate, witness the recent effort by the U.S. Chamber of Commerce to hold a "Scopes"-like trial on global warming for the simple reason that the corporations they represent will do just about anything to keep making a buck for as long as they can, no matter the cost and heaven forbid they should be held accountable for the damage that is staring us in the face.
This head-in-the-sand state of national denial is not sustainable, it's not even survivable and it most definitely is not profitable. Richard Power puts it quite eloquently,
(T)he climate change debate (by that I mean what to do about it, not whether it is real), is not... simply one of dire national importance, it is one of dire planetary importance, and the nature of opposition to meaningful action on climate change is not simply self-abusive, it is suicidal.
Or in the even more dire words of Johann Hari, we are at "five minutes to ecological midnight."
Whether or not the recession is ending is irrelevant and not even the correct question. At best, we are in a bit of economic remission, but do not be deluded, the ride has only just begun, and the big fall is still ahead.
I'll leave you with this...



16 Comments so far
Show AllThe shipping industry is the canary in a coalmine for the globalized economy, with the following link revealing what few are meant to see, http://www.dailymail.co.uk/home/moslive/article-1212013/Revealed-The-ghost-fleet-recession.html
We've all heard about positive feedback loops with regard to climate change, but they also appear elsewhere, like in economies. One is occurring in the US and elsewhere and goes like this: Last year's high oil/gasoline/diesel prices caused what is termed demand destruction, an economic term meaning people, countries can no longer afford to buy a particular product; but those effected didn't just stop buying petroleum products as the credit crisis and its associated housing meltdown happened almost simultaneously. This caused a markedly radical cutback in spending that caused many businesses already on the edge to fail because maintaining themselves on no-longer existing credit; thus, we had a new wave of retailing unemployed to go with those whose jobs were offshored. Of course, these folks now stopped spending, which caused yet another round of businesses to fail, spawning yet more unemployment and less spending which will cause yet another round of business failures, etc. On top of that, those lucky enough to keep their jobs are saving or at least paying off their debt so they won't end up like their friends and neighbors who've lost their homes and went bankrupt, which means they are spending a lot less too. An accelearating contraction of the economy that would be much worse were it not for what remains of the "automatic stabilizers" like unemployment insurance and food stamps that allow some degree of survival. The paramount reason for saving the people first and the bankers last is now becoming very clear--the people are by far the more important economic component--a fact recognized by the Full Employment Act of 1946, but mostly ignored since Nixon.
Despite the rhetoric, it's very clear the national government cares not a whit for common folk, except to dragoon their young for its wars and stifle their educational opportunities. This is the Class War, a long suppressed reality in the USA which is now becoming very overt. The situation is going to get much worse as more businesses fail, more become unemployed and more lose their homes. The linked item above focuses on the UK's economy, but can easilly be transposed to the USA--especially what will be seen as a failure of the Xmas retail season and ensuing economic fallout. If at all possible, try to find employment on the non-discresionary side of the economy and pay off your debt, and become involved with your area's Lifeboat, Transition Town, or other Sustainability organization, and alternative political groups as the local DEM or REP parties aren't going to lift a finger to help solve the crisis they so very clearly caused.
The current contraction is similar to 1930-1935 but very different in some key ways. What we are beginning to see is the same type of national government mismanagement made visible by Katrina--Bush saw it coming and did mostly nothing, and Obama continued his course and his madness of throwing money at Wall Street thinking that will do some good when it actually causes more harm. There are solutions, but they would make the common folk victorious in the Class War, and Obama and his bosses can't have that.
Is it just me, or has there been a significant rise in the number of pieces which lay out the present menu of unbelievably bad converging news, all basically concluding we're totally doomed? And soon?
We're still arguing evolution v creation for f@#k's sake - how the hell are we ever gonna tackle the above laundry list of super-sized coming catastrophes?
Which is probably why we're all pretty much living in delusion world, where everything will magically work itself out without the slightest bit of sacrifice or change needed on our part. Because when you stop and take in the big picture, it's enough to overwhelm a puny human mind...
The American human being exists for no other reason than to be ripped off - your money AND your life. The next time a sinister figure like Obama runs around the country with his bugle, blowing the cavalry charge, head the other way.
YES, FRANK, YOU ARE RIGHT. THE PIECES SEEM TO BE ALL GLOOM AND DOOM OR ABOUT BEGGING OBAMA TO DO SOMETHING.
IT CAN BE OVERWHELMING -- THE LAUNDRY LIST IS LONG.
I THINK WE NEED TO DO WHAT WE CAN LOCALLY - REDUCE OUR TOWN'S, OUR HOA'S, ETC. USE OF PESTICIDES, TRY TO BUY LOCAL AND ORGANIC FOODS, SPEAK UP FOR THOSE WHO DON'T HAVE A VOICE (WILDLIFE, ALL ANIMALS).
IF EVERYONE MADE CHANGES IN THEIR IMMEDIATE ENVIRONMENTS, INSTEAD OF BECOMING OVERWHELMED AND PARALYZED BY THE FEDERAL GOVERNMENT, WE CAN MAKE A DIFFERENCE.
You have good things to say, but it is a chore to read due to all caps. If you ever took a class in lettering, you would know that there is a reason for upper and lower case. All caps is hard to read, it doesn't flow, visually. If your keyboard is stuck, and you use Microsoft Word, there is a feature you can use - Format, Change Case, Sentence Case. Just saying.
Joe
If everyone made changes in their immediate environments, it would still be hell in a handcart time. Small changes cannot undo the effects of huge industrial operations, giant coal burning mechanisms, the fact that mechanized agribusiness feeds the world with quasi-toxic foods.
I'm afraid that people are going to become severely and dangerously angry when they realize that all their gestures: dutifully dividing up their trash into the correct color coded recycling bin, buying from farmers markets, driving fuel efficient vehicles, not using electrical devices, etc., are just too small scale to have an effect on what's coming down. I can hear them yelling, "It's not fair! We did all the right things! We're supposed to be safe!"
Well, sorry about the gloom and doom stuff, but that's the way I see things. That's why I don't post very often; don't want to rain on people's parades or throw cold water on their shreds of hope.
So I hope I'm wrong, but . . .
"As the healthcare ‘reform' debate has made all too clear, we have incorporated our democracy to the point where the welfare of huge corporations is considered at least if not more important than the welfare and health of the people they supposedly serve."
And the fascist, left hand over right biceps signals from the Supreme Court will undoubtedly confirm that welfare rights of "huge corporations" are more important than those of the citizens of this country; even if the Constitution of the United States never granted them "inalienable rights".
But how shocking will this be when we've already been told by our former Emperor that the US Constitution is "just a goddamned piece of paper"?
The sellout of our industrial base to China vs Walmart and the
Bubba Clintons playing the major role, has led to the destruction of our industrial base and the wrecking of our economy. The established order is only concerned about the oil and the Pipe lines. We are in a major depression and it will only get worse as Obama does not have a clue.
The stimulus is a diversionary tactic to get your minds of
the Depression that we have entered into.
Time for the working classes to get a wake-up call.
Who will tell the people?
Paranoid Pessimist September 14th, 2009 6:31 pm
Wrote:
I'm afraid that people are going to become severely and dangerously angry when they realize that all their gestures: dutifully dividing up their trash into the correct color coded recycling bin, buying from farmers markets, driving fuel efficient vehicles, not using electrical devices, etc., are just too small scale to have an effect on what's coming down. I can hear them yelling, "It's not fair! We did all the right things! We're supposed to be safe!"
That's similar to what's been bothering me. Along with the emotional effects you point out, I'm afraid all the eco-wonderful products and new gizmos, along with radically changed lifestyles and new industries won't amount to nearly enough to thwart the environmental changes happening so quickly. But all those things WILL cost a lot, and could drain money and resources we might truly wish we still had, because we'll still need money and resources to help us live THROUGH the now still ongoing environmental changes, if it's possible. There's no guarantee that it IS possible.
I can't stop thinking it could be a lot of happy talk about "stop global warning" that equated to billions of dollars that might end up doing no good at all, and actually leave us worse off than if we'd done nothing, believe it or not. Just one more time I'd rather be wrong.
Today's capitalist economic crisis is more severe than the Great Depression. Here's the proof ...
http://www.voxeu.org/index.php?q=node/3421
Thank you for the very informative link.
About 45 million without health insurance and our Congress appears willing to let them suffer. Do you think Congress is going to change its tune when things get worse? No, it will be survival of the financially fittest.
Derrick Jensen said it best in his premises:
THE 20 PREMISES OF DERRICK JENSEN'S "ENDGAME"
Premise One: Civilization is not and can never be sustainable. This is especially true for industrial civilization.
Premise Two: Traditional communities do not often voluntarily give up or sell the resources on which their communities are based until their communities have been destroyed. They also do not willingly allow their landbases to be damaged so that other resources—gold, oil, and so on—can be extracted. It follows that those who want the resources will do what they can to destroy traditional communities.
Premise Three: Our way of living—industrial civilization—is based on, requires, and would collapse very quickly without persistent and widespread violence.
Premise Four: Civilization is based on a clearly defined and widely accepted yet often unarticulated hierarchy. Violence done by those higher on the hierarchy to those lower is nearly always invisible, that is, unnoticed. When it is noticed, it is fully rationalized. Violence done by those lower on the hierarchy to those higher is unthinkable, and when it does occur is regarded with shock, horror, and the fetishization of the victims.
Premise Five: The property of those higher on the hierarchy is more valuable than the lives of those below. It is acceptable for those above to increase the amount of property they control—in everyday language, to make money—by destroying or taking the lives of those below. This is called production. If those below damage the property of those above, those above may kill or otherwise destroy the lives of those below. This is called justice.
Premise Six: Civilization is not redeemable. This culture will not undergo any sort of voluntary transformation to a sane and sustainable way of living. If we do not put a halt to it, civilization will continue to immiserate the vast majority of humans and to degrade the planet until it (civilization, and probably the planet) collapses. The effects of this degradation will continue to harm humans and nonhumans for a very long time.
Premise Seven: The longer we wait for civilization to crash—or the longer we wait before we ourselves bring it down—the messier will be the crash, and the worse things will be for those humans and nonhumans who live during it, and for those who come after.
Premise Eight: The needs of the natural world are more important than the needs of the economic system.
Another way to put premise Eight: Any economic or social system that does not benefit the natural communities on which it is based is unsustainable, immoral, and stupid. Sustainability, morality, and intelligence (as well as justice) requires the dismantling of any such economic or social system, or at the very least disallowing it from damaging your landbase.
Premise Nine: Although there will clearly some day be far fewer humans than there are at present, there are many ways this reduction in population could occur (or be achieved, depending on the passivity or activity with which we choose to approach this transformation). Some of these ways would be characterized by extreme violence and privation: nuclear armageddon, for example, would reduce both population and consumption, yet do so horrifically; the same would be true for a continuation of overshoot, followed by crash. Other ways could be characterized by less violence. Given the current levels of violence by this culture against both humans and the natural world, however, it's not possible to speak of reductions in population and consumption that do not involve violence and privation, not because the reductions themselves would necessarily involve violence, but because violence and privation have become the default. Yet some ways of reducing population and consumption, while still violent, would consist of decreasing the current levels of violence required, and caused by, the (often forced) movement of resources from the poor to the rich, and would of course be marked by a reduction in current violence against the natural world. Personally and collectively we may be able to both reduce the amount and soften the character of violence that occurs during this ongoing and perhaps longterm shift. Or we may not. But this much is certain: if we do not approach it actively—if we do not talk about our predicament and what we are going to do about it—the violence will almost undoubtedly be far more severe, the privation more extreme.
Premise Ten: The culture as a whole and most of its members are insane. The culture is driven by a death urge, an urge to destroy life.
And the rest:
Premise Eleven: From the beginning, this culture—civilization—has been a culture of occupation.
Premise Twelve: There are no rich people in the world, and there are no poor people. There are just people. The rich may have lots of pieces of green paper that many pretend are worth something—or their presumed riches may be even more abstract: numbers on hard drives at banks—and the poor may not. These "rich" claim they own land, and the "poor" are often denied the right to make that same claim. A primary purpose of the police is to enforce the delusions of those with lots of pieces of green paper. Those without the green papers generally buy into these delusions almost as quickly and completely as those with. These delusions carry with them extreme consequences in the real world.
Premise Thirteen: Those in power rule by force, and the sooner we break ourselves of illusions to the contrary, the sooner we can at least begin to make reasonable decisions about whether, when, and how we are going to resist.
Premise Fourteen: From birth on—and probably from conception, but I'm not sure how I'd make the case—we are individually and collectively enculturated to hate life, hate the natural world, hate the wild, hate wild animals, hate women, hate children, hate our bodies, hate and fear our emotions, hate ourselves. If we did not hate the world, we could not allow it to be destroyed before our eyes. If we did not hate ourselves, we could not allow our homes—and our bodies—to be poisoned.
Premise Fifteen: Love does not imply pacifism.
Premise Sixteen: The material world is primary. This does not mean that the spirit does not exist, nor that the material world is all there is. It means that spirit mixes with flesh. It means also that real world actions have real world consequences. It means we cannot rely on Jesus, Santa Claus, the Great Mother, or even the Easter Bunny to get us out of this mess. It means this mess really is a mess, and not just the movement of God's eyebrows. It means we have to face this mess ourselves. It means that for the time we are here on Earth—whether or not we end up somewhere else after we die, and whether we are condemned or privileged to live here—the Earth is the point. It is primary. It is our home. It is everything. It is silly to think or act or be as though this world is not real and primary. It is silly and pathetic to not live our lives as though our lives are real.
Premise Seventeen: It is a mistake (or more likely, denial) to base our decisions on whether actions arising from these will or won't frighten fence-sitters, or the mass of Americans.
Premise Eighteen: Our current sense of self is no more sustainable than our current use of energy or technology.
Premise Nineteen: The culture's problem lies above all in the belief that controlling and abusing the natural world is justifiable.
Premise Twenty: Within this culture, economics—not community well-being, not morals, not ethics, not justice, not life itself—drives social decisions.
Modification of Premise Twenty: Social decisions are determined primarily (and often exclusively) on the basis of whether these decisions will increase the monetary fortunes of the decision-makers and those they serve.
Re-modification of Premise Twenty: Social decisions are determined primarily (and often exclusively) on the basis of whether these decisions will increase the power of the decision-makers and those they serve.
Re-modification of Premise Twenty: Social decisions are founded primarily (and often exclusively) on the almost entirely unexamined belief that the decision-makers and those they serve are entitled to magnify their power and/or financial fortunes at the expense of those below.
Re-modification of Premise Twenty: If you dig to the heart of it—if there were any heart left—you would find that social decisions are determined primarily on the basis of how well these decisions serve the ends of controlling or destroying wild nature.
There's a bit of a fallacy to the statement that "only 41% of the cars bought under the [Cash for Clunkers] program were American". Of the rest of the cars sold, how many of them were Japanese brands, but built in the United States?
Also, the way the law was written, the rebate amount is specifically exempt from taxation ... that is direct from the government web site.