2008: Year of Hope, Year of Fear. Essay 3
Waking up to the new reality of curbing spending
David Brewster sees 2008 as a year of growing up and getting serious. I actually hope that transformation takes hold in 2009 as we all gradually wake up to the reality of what has hit our economy.
George W. Bush’s shadow loomed large over 2008, ensuring the election of Barack Obama, and the reelection of Chris Gregoire. The anti-Bush elections of 2006 and 2008 brought wholesale change to Washington D.C., but locked in the status quo here at home. For those hoping for the change that would come with a Dino Rossi administration, 2008 will always be the year of lost opportunity.
I suspect that history, however, will remember 2008 as the end of the era of easy money. Suddenly credit is tight, gas is cheap, unemployment is rising, and economists are dusting off a word rarely heard in my lifetime: deflation. Newspapers are getting thinner, and every industry is asking for help from the federal government, the only entity that seems to have any money.
No doubt many of us are hoping this is all just temporary, and that our home values will rebound next year, along with our 401-ks. That would be wonderful, but I doubt it will happen. For decades we have been warned that both families and governments were borrowing and spending too much, and saving too little. Now we have to do something about it. Politicians need to actually confront issues like out-of-control spending on entitlements, and earmarked pork. American business and labor need to work together to control costs in order to be internationally competitive. To grow our economy, Congress needs to move on issues like trade agreements and a balanced, realistic energy policy.
None of this will be easy or popular. American families are waking up to the new realities, curbing their spending, and doing what needs to be done. Can our leaders do the same? I think that will be the story of 2009.
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Comments:
Posted Thu, Jan 1, 10:09 a.m. inappropriate
Mr. Vance, up there in paragraph four you list the culprits for our current bad situation. I notice they rank as follows: overspending families, overspending government, overspending businesses (as a result of that pesky overreaching labor).
No mention of capitalist overreaching? No mention of that the pro-business, laissez-faire, deregulation fundamentalists of the Republican party who spent the last 30 years laying out the red carpet for the greed-fueled excesses of the credit-card industry, the mortgage industry, the banking industry, the stock market, the credit market? Those didn't play any part of this mess?? Nice blinders you've got there, Mr. Vance.
Yep, families need to budget better and get back to spending. Yep, so do government entities of every size. But I sure as hell hope that government regulators repurpose their chain saws and carve out a nice big makeover in the appalling big-financial-business practices that in large part underlie Jane and Joe Averages' financial difficulties.
Another trend of that's been amply documented in the last few decades is that the very wealthiest Americans have gotten way, way, way richer while the rest of us have been doing about the same or worse. The cries for increasing regulation from the last 6 months (even John McCain got on the bandwagon!) suggests that people have finally figured out that this inequity is largely due to the really rich people tilting the playing field more and more in their favor in the last few decades. Here's hoping that the "Masters of the Universe" types wake up to some new realities in 2009 as well--we will all be better off.