Here’s something you are not going to hear everyday. I agree with the group of Right Wing analysts who are arguing that this downturn in the economy is natural and a normal part of the capitalist economic system. They are absolutely right if you will pardon the pun. Capitalism is a cyclical system. There must be booms and therefore there must be busts. So Recessions / Depressions are just part of the cycle. How deep this one will be is still any one’s guess. The experts range in opinion from a recovery early next year to a total economic collapse by mid 2010. Who is right only time will tell. But this is not the first recession or depression the world has experienced and it will not be the last as long as we maintain a capitalist system.
I also agree with the Right Wing pundits that the current stimulus packages are misguided. I am being kinder here than they tend to be but then don’t expect me to start agreeing with them whole-heartedly. I haven’t gone off my nut yet. The Right is arguing that the stimulus is wrong because it is communism which they equate with state / government ownership. Communism does not necessarily mean state ownership but I will leave aside correcting this delusion of theirs as I don’t think they are interested. Besides, it would involve thinking and their is only so much you can ask of the pin-headed Right. But the stimulus is misguided for two basic reasons. First it may not work. If it doesn’t, can the taxpayer come up with another trillion or so dollars next year when the current funds run out? The answer is probably not without seriously affecting our quality of life and will we be in a mood to ante up more money after the stories of lavish parties and bonuses that have surrounded this first effort? At the very least it will be a hard political sell. So the current solution has not left us many options in the event of failure. It’s an all or nothing venture and the public is not prepared for the nothing. The second reason that the stimulus package is misguided is its intent. It is intended to fix the current system and that is where it loses me. As I said above, we can expect these down cycles, some to the point of creating serious economic and social hardship, as long as we have a capitalist system. Maybe it is time we thought about something different.
Capitalism is the most dynamic economic system mankind has ever devised. And we did devise it. Capitalism is not nature as some like to present it. Capitalism can create more wealth in a society faster than any other economic system we currently know of. However it also creates great inequality which leads to social tension and requires a more coercive state. We can keep putting band aids on the old girl but the fundamental problems will not change. Karl Marx was absolutely correct (I would never say he was right as that would be blaspheming against my faith) when he wrote that capitalism contains its own gravediggers. EVERY time capitalism has been allowed free reign to operate, unregulated and unchecked, it has collapsed upon itself. Compare the heady days of the 1920s to the equally heady days of the 1990s and beyond and you will see many similarities. We know what happened in 1929. That is history. We do not know yet whether it is repeating itself now but even if this recession does not pan out into a full depression it is already as, or more, severe than any other recession since the Great Depression. Not to blow my own horn but I have been expecting this big implosion since the 1980s when the move to laissez-faire first rolled into full swing. Anyone with a basic understanding of history could have predicted the current situation. When it would happen was always a mystery but that it would happen was never in question.
The new question becomes, now that we are in a major bust cycle, what do we do about it? Another band aid? Or transplant surgery? It is a tough question. So let me give you an easier one. Do you want your grandchildren to lose their house and have their lives torn apart by another recession / depression? If you support those who want to just put a new band aid on the old girl then the answer is yes. Think about it.
