More on the White Collar Recession
Interesting that my apolitical observations about the nature of the current recession – which is especially bad here in Washington – prompted a defensive outburst from my cohort Mr. Duffy. Duff writes “That's what makes America great. We adapt, we change, we improvise, we overcome. We don't sit around waiting for the almighty government to come rescue us. We rescue ourselves. And we know that eventually the good times will come again.”
Um… yes. Good times will come again. In the meantime, a lot of people are going to have it pretty bad. And these aren’t bums, welfare cheats or head cases we’re talking about either. The folks I mentioned in my post didn’t sit around waiting for anyone. They took classes at their own expense, invested in improving their skills and marketability. Those without jobs are sending out resumes constantly, and those who are hanging on are always looking over their shoulders.
They’re not in this fix because of any government policy. The recession isn’t Bush’s fault, it’s not Clinton’s fault, it isn’t even Greenspan’s fault. It happened because unregulated capitalism worked as advertised: boom and bust. Corporations with rotten, stupid management and greedy, irresponsible owners oversold each other on overpriced technology. They built it and nobody came. Then a few companies went beyond incompetence into outright criminality and undermined people’s confidence in the whole system.
In light of that, is it treason to suggest that a system that does not protect motivated, hard-working people from the possibility of economic catastrophe just might be in need of repair? Most people don’t want to live in a jungle. We willingly trade some economic liberty and commit ourselves to some economic obligations (taxes) to mitigate the dangers inherent in unregulated competition. We empower an institution called the Government to act in our collective interest. It’s called the Social Contract – it’s the basis of modern political theory.
Ironic, then, that the next part of Brain's post talks about how government policy – the tax cut, in his opinion – is the answer to the current mess. Most economists would agree that it’s good and necessary for governments to run deficits during downturns in the business cycle, either by reducing taxes or increasing spending. Even Gore proposed a tax cut. The problem is that Bush’s tax cut doesn’t help the people who are hurting right now – assuming it’s having any effect whatsoever on the economy at this early date. Meanwhile, the combination of the reduced tax receipts, the war and the promise of future cuts is putting pressure on long-term interest rates, and if they go up before things get better, we will indeed have a Depression.
2:53:42 PM 
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