Despite the fix we're in...
I didn't see it, but I heard today from one of the guys at work that one of the CNBC anchors went off on a rant last night about how sick and tired he was of Wall Street guys taking the hit in the press and in the court of public opinion for the financial crisis, and wanted to know why the blame wasn't being placed squarely on folks who got in over their heads with mortgages for houses they couldn't afford. Cheers over this rant apparently rang out all across the studio and the trading floor.
Another example of guys with everything placing all the ills of the country on people who have nothing.
His rant conveniently ignored the fact that for the most part, local banks are doing just fine, thanks. They knew how to manage their liquidity. It was the Wall Street banks and investment houses that melted down.
Which all goes to show how much this country really changed under Dutch. Even though his policies and ideas have been completely discredited, people still cling doggedly to them (hence, all the hysteria over socialism in the last election cycle, with the ironic part being that due to the excessive greed on Wall Street, we are now closer to socialism than ever before). This extends to the widely held opinion that Reagan was a no-nonsense tough guy who singlehandedly brought an end to the Cold War and made terrorists everywhere shake in their shoes. This is the same Reagan, mind you, who horrified his aides when he nearly gave away the whole nuclear store in his meeting with Soviet Premier Gorbachev, who responded to the Hezbollah bombing of the Marine Corps barracks in Beirut by invading Grenada and pulling out of Lebanon, and who traded arms with the Iranians for hostages and later lied about it.
In this Matt Miller interview, listen to him talk about his new book, The Tyranny of Dead Ideas.
In his new book, The Tyranny of Dead Ideas, Miller writes that while many of our current notions of economic and social well-being made sense when they first gained traction 50 years ago, they don't hold much water today... "Unless we explode the dead ideas I'm talking about in the book, we won't find our way back to a durable prosperity," warns Miller...
Three facts are now poised to shape our economic life for a generation. First, thanks to global competition and rapid technological change, America's economy is about to face its most severe test in nearly a century. Second, our political and business leaders are doing next to nothing to prepare us to cope with what lies ahead. And third, the reason for this inaction is that our entire economic and political culture remains in thrall to a set of "Dead Ideas" about how a modern economy should work. This book is about the threat that individuals, companies, and the country face from the things we think we know, and about the new (and surprising) ways of thinking destined to replace these Dead Ideas so that America will continue to prosper.
The next decade will bring a collision of forces that threaten to disrupt U.S. society, sink the middle class, and call into question the political and business arrangements on which our prosperity and stability have rested for decades. These perils have little to do with the housing-related financial crisis that gripped America in the fall of 2008; in fact, the need to steer our way through this near-term credit crunch now masks longer-term economic challenges that are far more consequential. The stakes couldn't be higher: if America doesn't decisively manage these tides of change, we'll face a backlash against our economic model—which, for all its flaws, has produced more betterment for more people than any other system in human history. If this backlash proves contagious, and other advanced nations lose faith in capitalism's ability to improve the lives of ordinary people, the rich world's efforts to protect its citizens from economic change will doom the developing world to dollar-a-day poverty.
The good news is that there are ways to avert this dark scenario and to flourish. The trouble is we're not doing what we need to because of the Tyranny of Dead Ideas. By this I mean the tacit assumptions and ingrained instincts broadly shared by business executives, professionals, policy makers, media observers, and other opinion leaders regarding the way a wealthy, advanced economy like the United States should work...
CEOs routinely bemoan skyrocketing health care costs, saying they give foreign companies a competitive edge because governments abroad pick up these bills. Yet in the next breath most executives insist that America's government should not play a bigger role in bearing this burden. Who else do they think is available?
Politicians and business leaders say we should cut taxes for most (some would say all) Americans to boost the economy. Yet America already has $40 trillion in unfunded promises shortly coming due in Social Security, Medicare, and other programs serving senior citizens — and that's before we toss in the costs of rescuing America's banking system, not to mention assorted sensible blueprints to insure the uninsured, develop clean energy, rebuild roads and bridges, extend preschool, and more. Has anyone noticed that these numbers don't come close to adding up?
Everyone agrees that education is the key to improving future living standards in a fiercely competitive global economy, and that we need to lift all children, not just the most talented, to higher standards of learning and achievement. Yet in the 2008 presidential campaign, not a single major-party candidate questioned our shockingly inequitable system of school finance, which dooms schools in poor neighborhoods in ways no other advanced nation tolerates. How are 10 million poor American children supposed to compete?
Top economists in both political parties perennially assure us that free trade is "good for the country," because the benefits to some Americans outweigh the losses suffered by others due to foreign competition. But wait: Who put economists in charge of weighing the interests of one set of Americans against another?
The answers to these questions will depend on how quickly we escape the pernicious influence of...
Six Dead Ideas:
The Kids Will Earn More Than We Do. Broadly rising incomes have been considered an American birthright. This pattern of generational advance is now at risk for as much as half the population.
Free Trade Is "Good" (No Matter How Many People Get Hurt). Though millions of people may be hurt by foreign competition, we're told, the overall gains from free trade so outweigh any downside that it is folly to question its ultimate advantages.
Your Company Should Take Care of You. Business (not government) must fund and manage much of our health and pension benefits, this idea holds, or else we risk becoming socialist.
Taxes Hurt the Economy (and They're Always Too High). The truth is that taxes are going up no matter who is in power in the next decade, and the economy will be fine. We won't turn into France or Sweden.
Schools Are a Local Matter. Americans need more skills to maintain our living standards as developing economies rise up to compete with us. America also spends more on schools than nearly every other wealthy nation — with worse results. Yet our unique model of "local control" and funding of schools remains sacrosanct.
Money Follows Merit. The most cherished illusion of today's educated class is that market capitalism is a meritocracy — that is, a system in which people basically end up, in economic terms, where they deserve to.
Getting to the effects of Reagan's ideas specifically, see Leon Wieseltier's Washington Diarist: Love Me I'm a Liberal:
It has been many decades since liberalism could fall back upon the power of platitudes; the platitudinous authority now belongs to the other side... The repudiation of George W. Bush is not in itself a renovation of liberalism, and neither is the apotheosis of Barack Obama. The public has not yet broken the grip of the conservative discourse that has dominated America for a generation.
Consider the insane headline on Newsweek's cover, "We Are All Socialists Now": an exclamation of its inner Hannity, as if the president is preparing to abolish private property or expropriate the means of production. All that is happening, comrades, is that our democratically constituted central government is acting to protect the whole of our economy by taking over, for a period, a part of our economy. But second natures, which are made more by culture than by thought, are not easily extinguished. Sean Wilentz was shrewd to contain the Clinton years in his recent study of "the age of Reagan," because Bill Clinton's inglorious role in the history of liberalism was to teach it to sleep with its enemy... On the day that Clinton pragmatically announced that "the era of big government is over," liberalism forgot itself.
Pragmatism has a dark side. The allure of pragmatism was lost on the conservatives, of course. They sought power so that they could act on what they believed. And when they got their chance, they ran the republic down in almost all its aspects. We must not draw the wrong conclusion from the rubble. The problem was what they believed, not that they believed.