So, what happened? Thats clearly the question thats on everyone's mind today as they go over the last year in their mind and try to piece together what last night's election loss for Martha Coakley means, and how things are different one year on from innauguration day 2009.
One year ago Wednesday I was working at a grocery store, bagging groceries and stocking shelves. I had just gotten the job and was already hoping that my career search would pan out, as I wasn't looking forward to making $10 an hour for an extended period of time. Due to the circumstances of my employment, i hadn't ever been qualified for unemployment, so I didn't get to be FUNemployed like a couple of my friends. Instead I was trying to dig myself out of a mess I had created with a combination of bad luck and poor judgement. I'm proud to say that, in that time I've managed to completely turn things around. I walked to work (where I'm interviewing for a higher position next week) this morning knowing that I have everything I need taken care of right now, including health insurance, rent, food, everything really. I've made great stides in reducing my personal impact on the planet, although there's far more left to do than I'm capable of. So, if I've personally managed to right the ship, why am I feeling like I just got hit in the chest with a sack of dimes? Well its because a relatively unknown guy from Massachussets will be taking a seat in the Republican Caucus some time in then next few weeks (depending on how long it takes to recieve absentee ballots and certify the election). Now, I'm not really much of a Democrat, I've never been that fond of the party (from a young age I distrusted anybody who talked like a populist while supporting big business) and frankly, am back to square one when it comes with dealing with them.
All across America you are seeing people in large groups chanting about how the liberals have gone too far, how America needs to be taken back, yatta yatta yatta, the fact is, all of that is bullshit. The political views of this small minority are so far from the American mainstream that they have literally no chance of being instituted. Even if these die hards manage to get some people elected to office, they will be unpleasantly surprised to find that Washington isn't a place where ideals matter. Think I'm going to far here? Just look at what our president has encountered in the very tumultuous year he's spent in office.
First, we had to deal with what can only be called an onslaught of Republican filibusters against legislation. Suddenly, the Lilly Ledbetter Fair Pay Act was a hot button issue. Card Check became a cause to rally around for conservatibves and a few unfaithful democrats, and it should have been immediately clear that what we were dealing with was a unified group that weren't going to break ranks for no reason. The Stimulus package was the first opportunity to test the waters for bipartisan agreement, as everyone who looked at the economy saw a need for the government to step in and do as much as possible, since there wouldn't be a chance of growth in the economy for some time. The reason for this should be pretty obvious: in the preceeding 6 months ASTRONOMICAL amounts of money was lost, often on an overnight basis. The government had stepped in to fix the liquidity issue by providing loans in the form of the TARP program, which in turn basically propped up the largest institutions, the ones who had taken the most profits from the subprime industry (Bank of America gets a bad rap for being involved here, they were actually relatively safe from sub prime debt, but they bought Leman after the crash and wound up on the hook for all of their debt). This legislation, passed while bush was in office and only done as a response to an epic crisis, is really the genesis of what happened last night, it all starts with TARP.
We should ask, as an aside (wow, I've already strayed pretty far, this might be quite a long post after all), why TARP is so pivotal in all of this. TARP was, without a doubt, absolutely necessary. I hate saying it in such stark terms, because it seems to preclude the notion that something else couldn't have been done, which is certainly not the case. The point I am making is that, after the stock market crash, after the credit crisis started, we were suddenly at risk of every bank losing access to basic money trading that kept them able to hand out money. Many businesses would have found themselves unable to write checks, many individuals would have found getting a loan a practical impossibility, and all of this would have happened fairly quickly. What this demonstrated, subtly, was the way in which the financial industry had manipulated itself to be part of every segment of American life. Business which weren't in risk of going out of business couldn't pay their employees because of a clog in the system, not because they didnt have any money, but because they depend on the financial industry to float them, because they have their money tied up elsewhere. Everyone uses the financial industry in some way or another, which they had been seeking to increase near constantly. What should be a relatively simple concept, working for a business and recieving wages, now involves so many accounts and parties that you'd think we were crazy for letting the situation get so bogged down, all for the sake of minor convenience. But thats the reality of it, the banking industry controls everything in one form or another, and it wants everyone to owe money in one way or another. Had we let things collapse, it would have led to widespread problems that would have threatened the very stability of our country. While I'm all for a little revolution (or a lot of it, if its appropriate), the people who run the country can't let a think like that happen, because it hurts their creditbility, legacy, and the overall economy. So they let the former Goldman Sachs CEO and all around piece of shit (Objectively confirmed through tissue analysis mind you) Hank Paulson write a bill that basically gave him the power to do whatever he needed to with 700 billion dollars. Now this was a lot of money, but it had to be to accomplish the task of unfreezing the credit markets. Unfortunately they format that assistance took didn't amount to much that would help normal people, instead the money went straight into bank balance sheets and firmed up their situation, allowing them to get back to what made them money: taking risks and harming people. That 700 billion, considering the fiscal deficit the US wound up in around 2008 (Bush's last year had a massive deficit, over a trillion dollars) meant that there wasn't much latitude a few months later for introducing a massive stimulous bill.
So, the government barely blinks at dedicating 700 billion dollars to a plan that will essentially prop up the financial system and allow them to get back to the reckless behavior that got us here, yet the plans for a stimulous package were winced at when they approached a trillion dollars in spending. Obama wanted his stimulus to be effective, but he thought it was more important to accomplish something than to get a bill that would be a paradigm shift in how we dealt with the crisis. So, as the stimulous bill was written, suddenly it started attracting all sorts of provisions that reduced the benefits of the legislation, bogging it down to the point that it had nearly a third of its value tied up in tax cuts, none of which make for particularly effective stimulus. The legislation included a number of useful commitments to spend money on renewable energy and a smart grid, as well as high speed rail. Unfortunately, the government didn't make commitments that are equivalent to even what China's government is willing to spend on these issues, so despite the opportunity to spend tens of billions of dollars on real economically viable industries, we opted to spend as much of the money as possible filling in funding for shovel ready projects states suddenly couldn't afford. We had the opportunity to build infrastructure that would pay us back hansomly, and we spent the billions filling pot holes. Now, obviously we were never going to get a perfect bill, but after the free money and strippers plan that was TARP, the notion that Americans would be getting mild tax cuts and state projects paid for didn't seem like the progressive game change that Obama had engendered everyone with the hope for. So despite the suggestion of economists, we went small on the stimulous package, and while it did help to stabalize things, it certainly did nothing to spur economic growth.
Another tangent (this post is the first in a long time, and is understandably long due to pent up feelings): The biggest problem we've had thus far in getting the economy going again was that the stimulous and the tarp failed to generate productive jobs, jobs with value added to the economy. When someone is paid to fix a pot hole or improve an intersection (a large number of shovel ready programs fit in this category) they recieve their paycheck and their work is done. The only economic benefit of this is that its less likely this road will damange someone's car. what the government should have done was pour the funding into a series of programs that would have generated revenue, or at a bare minimum that would have facilitated someone else generating revenue. The government has tools and power that are generaly not used, because they are of an extreme nature, and I'm suggesting that through emanant domain and the power of the purse, our government could have overnight created an army of solar panel manufaturers, or wind turbine builders, or hundreds of miles of high speed rail, all of which would have created work and simultaneously driven new innovation. Unfortunately, much of this spending would have taken months or years to organize, so what was needed was a multi-part stimulous package, one that included immediate funds for keeping state employees on payroll, as well as the long term funding to get some real work done. This approach wasn't even considered, unfortunately, but thats what one should expect from Washington, a lack of creativity and a reliance on conventional wisdom. It may very well be what I've described wouldn't have done enough to get us closer to normalcy, but thats neither here nor there, the fact is, the Democrats went with what they had.
So, while Obama's stimulous pacakge paid out most of its money, the Democrats set about addressing an issue that is extremely important when dealing with the economy: Health care. Nothing poses a greater threat to the US government's economic stability than health care costs. It was an obvious and important move on Obama's part to try to do something to bring down health care costs, but his first mistake was attempting to take an insider's approach, submitting goals to the house and senate without firm guidelines, and meeting with all the lobbyists from the industry, attempting to get them into the process. By allowing them to help shape the legislation, while simultaneously letting a deeply corrupted legislative body work on the bill itself, Obama handed his health care plan over to the inside the beltway industry. Just like the stimulous package was reworked into a fairly useless bill due to compromise, the Democrats took a compromise bill on health care and started with it, a surefire way to have your already watered down approach watered down further. Simultaneously, suddenly the narative shifted and the august recess led to a long drawn out process, through which Republicans, and to a lesser extent a few democrats, decided to take an unreasonably hard line on a number of issues, which is what led to the health care bill not passing the senate before Christmas Eve.
So, what really happened in the last year? Obama went to Washington, and he found himself in the middle of a clusterfuck so deep he had neither the time nor the power to unwind it. Rather, he tried to coopt as much of the system as possible to support his agenda. This didn't have the desired affect. Instead, he got an ineffectual stimulus package, a couple of token pieces of legsilation (sorry Lilly Leadbetter, but that bill didn't have a remarkable affect on the life of the average american) and a health care bill thats, at its core, a giveaway to the insurance industry. Obama allowed himself to play by the rules and in response, he's just been hit in the chest. If this moment is a lesson in politics, I don't know what is. What did George W. Bush do while attempting to paint himself as a middle of the road guy? He kept his base fondly fawning over him. Now, that's harder to do with Democrats, but that is only because we want results, rather than just condescension. I mean, look at what Bush accomplished for conservatives: not a whole lot. Sure, he had the office of faith based intiatives, but thats such a small issue that I'd call it negligibly important. He didn't end abortion (or even, realistically, put in a supreme court that will end abortion), he didn't stop gays from marrying, he didn't fix deficits, he basically funded abstinence only education and talked a lot about other things he got nowhere on. For a Republican, thats all you have to do to keep the base happy. For a Democrat, you have to DO something, its a higher standard thats harder to get to, but that's life, get used to it.
The lesson is: don't claim you're the one who's going to change things, then show up and realize you can't fix anything because of the structural impediments. Its time for Obama to man up, figure out how to deal with these issues (he could pressure the senate to end the filibuster, for one, although some people think thats a bad idea. He could use budget reconciliation to pass more bills, but thats a procedural headache. Still, I think it will be something they have to use more now. Other than that, Obama doesn't have any power to fix the fundamental problems of how Washington does business. Arrogant, self important people run that city, wealthy scumbags tell them what to do, and a sort of eunuch class of aids keeps everything going, no matter who's in office. No one in the whole city is clean, and that fundamental problem is why I'm losing hope (admittedly, i was pretty pessimistic a year ago as well). Obama's window to do something real extends another year for me, before I truely abandon him,and his party, and get back to my more revolutionary roots, which would basically mean forming a party or joining the green party. Now that I'm not just a college student, I can actually excercise a little influence when it comes to working within a party. The lesson, friends, is never go into a situation acting like you're special. Nobody is special, and nobody can magically repair our problems. Its going to take work, and possibly a constitutional convention or a revolution. Just know this: The people with guns win the revolution. Thats right, its time for liberals to start buying guns.
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