“The fundamentals of our economy are strong.”
“The market self-regulates” and “get the government off our backs” and “deregulate everything” have been the dominant refrain in economic thinking my entire life. A chorus of smug business school boys, University of Chicago professors, and self-righteous hacks profiting off of the short selling of the American Dream claimed they knew better than the rest of us about the real economy. While most Americans worked for the same wages (inflation-adjusted) or less than they did in the 1970s, worked more hours than any First World nation, took less vacation than Japan, and paid more for crappier healthcare than the rest of the industrialized world, free-market fundamentalists and their sorry preachers in the media kept on jabbering about the American way of life and the boom that will never die.
Nothing fails like failure, and this death came almost overnight.
In the last two weeks, the federal government has nationalized Fannie Mae/Freddie Mac ($5 trillion in assets), American International Group ($1 trillion) while bailing out Bear Stearns with a speed that would make Indira Gandhi wince. Lehman Brothers is broke and only two out of five investment banks still exist. “The last 10 days have been the most remarkable period of government intervention into the financial system since the Great Depression,” write two University of Chicago economists.
In the coming weeks, I’ll point fingers and name names on who did this. Wake up America…. our asses is broke.