CALLANDER: America learns economic lessons

By ALANE CALLANDER
Published: September 25, 2008

The Stafford County Board of Supervisors recently pared back severely the county’s capital improvement program in response to bad economic numbers. Revenues are substantially down in the county, and with a national economic crisis, you can expect that both state and national governments will be providing less assistance to local projects as well.

Americans are learning some very hard economic lessons right now. It wasn’t long ago that we had a booming economy, building was going on everywhere and financial confidence was at an all-time high. Offers for credit were everywhere you turned. Americans developed an insatiable appetite for spending imaginary money.

Risking money in the stock market didn’t seem a risk. We were the world’s most prosperous nation, weren’t we? We had learned lessons from the Great Depression, and didn’t we put into place all kinds of protections so that the market doesn’t crash again? Surely, we knew, our economists have figured out how to avoid recessions.

We’ve learned with the collapse of enormous financial institutions that whoever told us they knew what they were doing about our economy didn’t. I put blame solidly in the lap of the current Republican Party, the pro-business party that kept telling us de-regulation, less government and lower taxes on the wealthy is the path to prosperity for all.

George W. Bush actually has an M.B.A. from Harvard Business School. You’d think this was an area he’d be prepared to handle, but philosophy matters. We would have been better off with someone like the former economic advisor to Democratic presidents, John Kenneth Galbraith, influencing policy.

Galbraith, who died in 2006 at 97, was a contributor to “The Great Society” approach of President Lyndon Johnson. A liberal/progressive economic theorist, Galbraith thought America was not generous enough to its poor and not attentive enough to public need. He observed that advertisers in an affluent society such as ours convince people to spend their money on luxuries rather than in ways that would serve society. His words certainly ring true today.

“Greed” is a word mentioned today. Those in power on Wall Street didn’t care about the masses, just about how much they could stash away in their personal accounts. If they have lost everything, we can say that they got their “payback.” Still, good people on Wall Street got caught up in the mess as well. In America, you ought to be able to work hard, save for retirement, and expect the money to be there when you need it. Forget privatization of Social Security. The stock market collapse should end that debate.

Recent happenings have certainly helped level the economic playing field. Many very rich people lost their wealth. Will they be considered middle class now? Surely they aren’t now among the poor, are they? It helps if you’re Ed McMahon and Donald Trump steps forward to buy your near-foreclosure house and rent it back to you!

Oddly, the know-it-all capitalist investors now find themselves furthering the cause of socialism, as government considers bailing everyone out. The Texas residents who just lost everything in Hurricane Ike now find themselves in the same boat as Wall Street executives. Everybody is starting over.

The concern for lost revenues here in Stafford is truly effecting what government can commit to doing to improve quality of life and also meet the most basic needs.

For example, design for a new courthouse has been delayed by at least a year, even though folks with the courts say the conditions are dire and they needed a new courthouse years ago. 

But how do you convince citizens of this county that a new “Juvenile and Domestic Relations Court” is worth $34 million dollars when there isn’t money for teacher raises, when our parks and recreational facilities are deteriorating more and more each day, and we can’t afford to improve narrow, winding roads that lead us to school and work?

I wonder, how many individuals end up before the courts because of burglaries? Perhaps the “criminals” were just trying to come up with the cash to pay the mortgage so they wouldn’t lose their overpriced, oversized house - you know, the house they were encouraged to buy even though they couldn’t afford it. 

Alane Callander is a south Stafford resident active in many local causes.