crying out loud

Grover Norquist
and his Libertarian ilk
famously declared their intent
to shrink government down to a size
where they could “drown it in the bathtub”

With the help of the Bush Administration
they succeeded to the tipping point
where both they and the world economy
fell in head-first.

And now they beg for rescue
from the very government
they hoped to drown.

The “Leave Us Alone Coalition” ideology that helped steer the course of American politics into the 21st century was based largely on the premise that personal property and earnings lay outside the public sphere and that free markets and their wealth should be exempt as much as possible from any kid of public oversight, regulation or taxation.

This kind of thinking has been repeatedly debunked, but never more aptly than in Thomas Paine’s Agrarian Justice (1796) where he writes that if you separate…

… an individual from society, and give him an island or a continent to possess… he cannot acquire personal property. He cannot be rich. So inseparably are the means connected with the end, in all cases, that where the former do not exist the latter cannot be obtained.

For crying out loud! No one becomes wealthy on their own. Every landowner’s wealth is highly dependent on legal systems and public infrastructures and real estate markets established by the communal actions of governments and societies and local groups acting for “the common good.”

From Warren Buffet and Bill Gates to the local burger franchisee or contractor, every entrepreneur’s wealth is acquired on the backs of a host of inventions and infrastructures for which they pay no royalties aside from taxes and an inferred responsibility to the greater society.

In their superb analysis of U.S. wealth distribution, Unjust Deserts: How the Rich are Taking Our Common Inheritance and Why We Should Take It Back,” authors Gar Alperovits and Lew Daly demonstrate that 90 percent or more of most private earnings are appropriated from the collective inheritance of society and not from individual effort or achievement. They point out that “the great bulk of our prosperity is due not to our own efforts or genius, but to the efforts and knowledge accumulation of those who came before us.”

Historic inequalities in the distribution of wealth in the U.S. have contributed to and are exacerbating the financial crises of the moment and calling into question common assumptions about the rights and responsibilities of those who profit, especially those who profit greatly.

The conventional wisdom of the moment is that the housing market, and bad mortgages in particular, is to blame for the current global economic crisis.

Conventional wisdom is wrong, or at least short-sighted

Look back in time just eight months, before the metaphorical “house of cards” began to fall, and you’ll find the tipping point on the front pages of newspapers and in the lead stories of television news broadcasts: fuel prices.

There’s no question that the housing market was overpriced and lending was out of control in the U.S., but the avalanche of failed mortgages did not begin until speculation on oil drove up fuel prices, which in turn inspired a blizzard of food price increases and commodity speculation. Rising prices on those two essentials — food and fuel — affected everyone, but none more severely than dangerously indebted homeowners.

For crying out loud! How many mortgages failed as a direct result of the surge in food and fuel prices early in 2008? How many foreclosures would have been avoided if family budgets hadn’t been busted by those unexpected cost increases?

The current economic crisis is a direct result of the Bush Administration’s failure to thwart the speculation on oil by either putting restrictions on trading or releasing oil from the nation’s strategic reserve. In hindsight, selling off oil from the reserve at $150 a barrel and replenishing the reserve when prices dropped below $100 a barrel would have been a stroke of genius.

Instead, the Bush Administration chose to hoard rather than invest and to use the crisis as an excuse to open up the Arctic Wildlife Refuge to oil drilling. No serious attempt was made to stabilize oil prices and we will live with the consequences for quite some time.