This is what a Category 4 financial crisis looks like. Giant blue-chip financial institutions swept away in a matter of days. Banks refusing to lend to other banks. Russia closing its stock market to stop the panicked selling. Gold soaring $70 in a single trading session. Developing countries' currencies in a free fall. Money-market funds warning they might not be able to return every dollar invested. Daily swings of three, four, five hundred points in the Dow Jones industrial average.
What we are witnessing may be the greatest destruction of financial wealth that the world has ever seen -- paper losses measured in the trillions of dollars. Corporate wealth. Oil wealth. Real estate wealth. Bank wealth. Private-equity wealth. Hedge fund wealth. Pension wealth. It's a painful reminder that, when you strip away all the complexity and trappings from the magnificent new global infrastructure, finance is still a confidence game -- and once the confidence goes, there's no telling when the selling will stop.
That's the sort of news that really lifts your spirits, especially when you could see this horrific train wreck years in advance. Nothing that is happening on Wall Street is a surprise to anyone, at least anyone who was willing to pay attention.
True, America's financial crisis is the result of reckless gambling on the stock market with housing mortgages, much of which was junk. It's also true that Republicans' obsession with de-regulation, the "magic of the free market," and their insipid conservative ideology that believes government should be drowned in a bathtub (a telling analogy if there ever was one). But there's more to this crisis than that, and it isn't merely the fault of the GOP.
But more than psychology is involved here. What is really going on, at the most fundamental level, is that the United States is in the process of being forced by its foreign creditors to begin living within its means.
That wasn't always the case. In fact, for most of the past decade, foreigners seemed only too willing to provide U.S. households, corporations and governments all the cheap money they wanted -- and Americans were only too happy to take them up on their offer.
Put simply, America has been living beyond its means. Ours is a culture wholly dependent on easy credit, of buy-now, pay-later. Endless home refinancing worked for a while, and foreign investment, coupled with massive deficit spending, helped to prop up this economy. But it was all a shell game, a house of cards. The Bush Economy was always a sham, and you cannot sustain a world-class economy on debt. It just doesn't work.
America can't work when we're all living on credit cards and bank loans. You cannot dismantle the manufacturing backbone of this nation, then ship it overseas to take advantage of cheap labor. You cannot make up the difference by building shopping malls and Wal-Marts. We have become a Consumer Economy. We no longer build things. We no longer take care of ourselves. America must rely upon the rest of the world, as a debtor nation. This couldn't last forever.
This American lifestyle is simply unattainable for many Americans. It's a shocking truth, especially for those who remember the glory days of the post-WWII booms of the 1950's and 1960's. It's been mostly downhill ever since, coupled with the rise of the Republican right and the massive transfer of wealth to the top.
It's remarkable to me how easily we took the Clinton Economy for granted. We didn't appreciate just how good we had it. Clinton had balanced the Reagan/Bush deficits and left us with endless surpluses. Hell, we were on the fast track to completely pay off the national debt. Imagine that. Had Al Gore been allowed to take the Oath of Office (after all, he did get the most votes in the 2000 election), America would be guaranteed the world's strongest economy for the 21st Century.
Bill Clinton was one of the best economic Presidents this country ever had. Then Bush and Cheney and the damned Republicans came in and looted the place. The past eight years were nothing but a sham, a massive organized crime heist. Never before in post-war America has an economic boom resulted in poorer citizens. The United States supposedly made a lot of money. Where is it? Who stole it?
Ah, I know, more tax cuts for the rich. More trillion-dollar wars. More big-screen televisions. More videogames. More oversized Bite-Me-Mobiles. More supersized, expensive homes that you couldn't afford. More massive subsidies and giveaways to corporate criminals who steal the wealth of this nation and leave us in rubble.
And despite all this supposed prosperity, wages decline, bridges collapse, cities drown. Our Army is strained to the breaking point in a useless $3 trillion permanent war. Our highway system is crumbling to no avail. Our health care system is the shame of the world; it doesn't even exist. The cars and SUV's are literally killing the planet. And an economy and government is facing bankruptcy.
Hell, everything in America is broken, everything. The movies are terrible, cliche and stupid. The music is flat, tuneless, and physically painful. Television...don't get me started on that moronic idiot machine. Even the videogames have jumped the shark. I miss my Sega Dreamcast and my 15-and-1 Minnesota Vikings and my third-party Governor and my booming economy where everyone made money.
I miss the America that gave us Jazz. I miss the America that gave us rock 'n roll. I miss the America that put a man on the moon. Can you believe that?! Twelve men walked the surface of the moon. It was mankind's greatest achievement.
I miss the America that saved a world from the tryanny of fascism. Our grandparents liberated the death camps and the torture chambers. Now our government runs those torture chambers. Now our government rejects the Geneva Conventions, the spirit of the Magna Carta, the spirit of the Christian Gospels. This nation has become truly, deeply, bankrupt.