Because You Never Asked

 

(12/08)

     As I write, with the exception of the upcoming game between the Gators and the Crimson Tide, the big story running amuck in our lives is the financial meltdown of 2008, which seems to have been the result of lax oversight --- or perhaps it would be better to say the encouragement of a Wall Street scam where people who dress well, smell good, and are adept at folding the New York Times, were trying to make millions of dollars without having a product to sell. If we translate this to English, we get “smoke and mirrors”.

     I do believe the lead off hitter in the eventual fall of this house of cards was the giant bubble known as AIG. God knows (I doubt it) what a company like this does-did, but there is one thing I do know: those guys had some very cool commercials. There was one in particular that continues to stay with me. A boy of perhaps 10 years wanders into his parents’ bedroom in the middle of the night. They awake, turn over and look at him in a blur of semi-consciousness. The boy then delivers a 30 second harangue as to how he is worried about the family’s future, its financial strategy, its blend of annuities and IRA’s and 401k’s, with all the specialized jargon and lingo --- just beautiful. At the end of it, the father looks at his worried son and says, “but we have AIG”. The boy is immediately relieved, says “oh”, and goes back to bed. One watches a commercial like that and thinks, gee, AIG, they really know what they’re doing.

     A week later they had vaporized.

     What started in America, and probably because of Americans and their way of playing the “game”, soon spread to the rest of the interconnected global economy. And now you turn on the TV, or read the blogs, and the gloom and doom is so thick and inky, it’s like it’s never daytime anymore. And every “Situation Room”, and every Rachel Maddow, and everything “fair and balanced”, and the “most respected names in news”, and everything having to do with “information”, is overrun with financial experts trying to explain this mountain of poop. If the expert is American, he generally has a name like Morgan Wharton and is a fellow at the Cato or Brookings Institute, so called “think tanks”, which leads one to ask, “what have they been thinking“!? If he is English, he has a name like Nigel Brown and is an economic expert at the Financial Times (aren’t they all?), and you could just die for his Derby Day accent. Morgan and Nigel will return later in this essay.

     Yesterday, I turned on the TV and the big news was that we were officially in a “recession” (someone said it). Not only that, we’ve been in it for a whole year! And I thought, my God, how did I miss it? It’s like, I haven’t felt any different, I’m still regular --- and then it hit me: I’ve been living in a “recession” my whole life. Is that all you’ve got?

     And then I saw one of my favorite experts, the gnome-like Robert Reich, ex-Labor Secretary for Bill Clinton. I love Robert Reich, he’s such an articulate little troll. Regardless of what I can understand, he says it so lyrically that I‘m ready to follow him anywhere. He’s a regular on Big Media TV and the other day he started throwing around the “D” word ---  like in Studs Terkel and long gray lines of men in moth eaten clothes. And I said to myself, Jerry, it’s time to get smart. Why not invest in soup and apples?

     Trying to decide if we are in a “recession” or not, or in a “D” (shhh), is something like trying to decide which team is # 1 in college football: there’s a lot of data, lots of criteria, but nobody knows for sure. In fact, this ambiguous quality is the basic personality trait of “economics” in general. There seems to be as many theories as to why this happened and how to fix it, as there are “economists”. The eventual return of Morgan and Nigel will further focus this idea.

     So if the doctors themselves can’t seem to find a way to diagnose and cure this economic sickness, how are we, the Monday Night Football Yokels, supposed to understand it? Maybe the key is in not trying to delve deeper and deeper into the ailment. Maybe the key lies in seeing the obvious, in staying simple, in not complicating things. The first thing that strikes me in doing such are the numbers themselves. They seem to be mythical.

     By now, we’ve all been conditioned to the fact that some financial institutions and industries are “too big to fail”, and it ain’t the fruit and vegetable stand on the corner. Except for a few Republican oligarchs who always have plenty of money, people who feel poverty is neither their fault nor concern, there is a broad consensus here and within the context of the economic game now in use, maybe they are right. So the cavalry is dispatched to rescue these institutions with a sack full of $800 billion of taxpayer money. But as the tide of sewage let loose by this crack in the financial pipes continues to rise above our ankles and up to our knees, the numbers continue to escalate. We are now entering the realm of trillions.

     When you round numbers off and simply say so and so millions or billions or trillions, something is lost in the translation. We get used to these words: a billion here, a trillion there, what’s for dinner? With this in mind, I am now going to write down an approximate cost that we the government is going to spend on these bailouts, not how many billions or trillions, but a hypothetical exact number: one trillion, four hundred and sixty three billion, seven hundred and forty eight million, six hundred and twenty two thousand, five hundred and eighty three dollars and ninety nine cents (like the gas stations do, just to make it seem cheaper).

     And you thought those human size checks they present to Tiger Woods after a tournament were just for show.

     OK, now I am going to write this number out with Arabic numerals (and you thought the Arabs were so stupid) and then I am going to write another figure right under it.

$1,463,748,622,583.99

$678

     If you have a pulse, you should be wondering what that second number stands for. It is what tens of millions of us make, more or less, after working a full week. I think we can agree, the relationship of these two numbers are in galaxies far, far away.

     We live in a society that ranks our worth as human beings very compatibly to the amount of money we have. Given the amount of money represented in the top number --- and given the amount of money represented in the bottom number --- and given the fact that this money actually exists, I’d say almost all of us have the status of a maggot. In scrutinizing these two numbers, one gets the feeling that almost all of us have none of it, and almost nobody has all of it.

     There is an absurd, fraudulent quality to all this. It seems to be fiction more than non-fiction.

     And it gets even more absurd.

     If we stick to the program and do not get mired in the endless maze of complex economic theories (smokescreens?), and we keep it simple and common sensical, the next question has to be, “where is all this money coming from”?

      Another thing we have been conditioned to in the last 20 years or so is that there is just no money for anything. We’ve got to cut spending, get more efficient, stop government waste, look out for all those “earmarks”, cut the “pork”, there’s just no money for anything. We have to cut Medicare, it’s only a broken leg, get used to it. And for those 40 to 50 million of you who have no health insurance (this number is real), our advice is that you not get sick, we can’t afford it. And public libraries, c’mon, who needs libraries, nobody reads anymore anyway, and once we get rid of pre-school and day care, we’ll have even less people reading, so give us a break, we just don’t have the money. And think about it, do we really need those art and music classes, I mean, did Leonardo Da Vinci ever go to an art class? And those school lunches and breakfasts, get real, you can go buy a chicken sandwich at the Burger Shlurger for 99 cents, if you can’t afford that, you deserve to go hungry. And those jobs down at the county that had existed for generations --- look, when there’s no money, what can we do? Our public parks and recreation facilities, they’ve been taken over by homeless people anyway, so why spend money on that? And those senior citizen crossing guards at our schools, picking up some extra change working 10 hours a week, in addition to feeling useful and relevant, do we really need them? Kids these days are smart, they know how to cross the street. I know, it’s tough, we are all going to have to do our part, suck it up, play like a man, put our pants on one leg at a time and face the grim reality of these difficult times with a smile on our faces and a spring in our steps, because that is what Americans do. And I’m sorry, Mr. and Mrs. America, if all we can do at the moment is  lay you off, provide a soup kitchen or two, fight the war in Iraq because it is better to be poor than not free, and bailout AIG and the rest of them with one trillion, four hundred and sixty three billion, seven hundred and forty eight million, six hundred and twenty two thousand, five hundred and eighty three dollars and ninety nine cents, because we just don’t have the money.

     Upon hearing such a figure, anyone with the IQ of a gibbon, should be asking two questions: 1) how much does it cost to feed a kid a decent meal in school, and, with all due respect to the Redundancy Gods, 2) where is all this money coming from?

     Now, the smart money would be betting we are borrowing the money. If you are still paying attention, you might now ask, “who in their right mind would lend that kind of money to an entity as thoroughly bankrupt as the United States“? Well, we have collateral, it’s a big country, lots of resources, infrastructure, universities, etc., and the Chinese --- the Chinese? You mean that backwards, totalitarian country filled with unhappy people yearning to be free, are going to lend us, the richest, happiest country on Earth, hundreds of billions of dollars? That’s right. And if we default, the Chinese get to own the New York Yankees?

     And now we are going to bring back Morgan and Nigel, our aforementioned financial experts, and we are going to get in front of the TV as they explain to us why the snide insinuations made in this essay as to the irrational, preposterous nature of their precious economic system is not true, this is how it has to be, and we’ll all be better off for it, just shut up and listen.

     And here they go: “It is imperative to realize that the annual rate of inflation was putting a tremendous burden on our fiduciary responsibilities in the asparagus market, and once the annuities became due on the roll over of bi-annual interest rates, the situation became untenable in the Straits of Molluca, where piracy was hindering the free flow of credit, but now the balance of payments can ease their way back to normalcy with the help of the Fed, who will keep the price of a good pinot grigio at affordable levels until venture capital is once again ready to prime the sub-mortgage market with a lifeline to our most essential industries --- porno, Las Vegas --- which will then stimulate the labor market with an electric cattle prod, until everyone can finally go out and buy a new TV”.

     And it’s like we are sitting in a high school algebra class and we’ve just got the hang of equilateral triangles, but the blackboard is covered with Einstein-like physics equations. And when Morgan and Nigel are done, we’ll sit there dumbfounded, scratching our heads, not daring to look at each other, until somebody finally says, “turn on the football game”.

     And that’ll be it. And we will go on being maggots.