For almost two decades, Republicans and their plutocrat financial backers have been like kids in a candy store.
They’ve been gorging on the opportunity to eliminate the regulatory frameworks that provided a backbone for markets to function (in the case of the financial sector) and eliminating regulatory frameworks that balanced corporate and societal interests (in the case of everything from environmental rules to workplace safety to personal bankruptcy).
Individually, they made a ton of money from all the shadow markets, ponzi schemes, and business opportunities enabled when consequences could be ignored.
Now, with today’s Wall Street news, the kids have pushed over the display cases, are grabbing all the remaining candy they can - as a last hurrah - and are scurrying for the doors. (Have no doubt that lots of individual fortunes will be made in sorting out this mess by redistributing assets among other institutions and fat cats, and sticking taxpayers with the liabilities.)
Please join me in considering what it means for the rest of us (below the fold).
• In the best-case scenario, taxpayers will only be stuck with the bill for massive bailouts. At the very least, interest rates and tight credit are likely to burden the economy for a long time, making it harder for people and businesses to get loans – for business expansion, for houses, for education – for everything.
(Let’s not even contemplate the worst-case scenario.)
• Every other economic sector (starting with retail) will probably take another big hit, eliminating another large swath of working class jobs and opportunity, and further suppressing wages
• A lot of pension funds will become even more under-funded as assets evaporate – impoverishing seniors, and creating the possible need for a bunch of secondary bailouts from the PBGC (i.e., the taxpayers) which could impact us for decades
• A lot more US assets will probably get bought up on the cheap by the "sovereign wealth funds" of kleptocratic petro-states and other petty dictatorships
• For the next several years, US stakeholders resisting change (e.g., the whole healthcare sector) will claim the crisis means we can’t afford to make real changes
Its ugly.
But here's the point of my diary:
The proximity of the election means we need to focus on the near-term.
Tomorrow (as soon as they’ve tended to their personal portfolios) Republicans will go into overdrive trying to blame all of the turmoil on Democrats. You can already visualize the ads.
One of the inescapable conclusions that emerged from the DNC is that nobody on the planet frames economic issues in layman terms better than Bill Clinton.
This is a time where Democrats will need to help connect the dots for the average Joe on what is happening to the US and global economy. It is critical that voters understand that the meltdown is a direct result of failed Republican policies.
Given Clinton’s skills, and his status as the last President to preside over a decent economy, he could get opportunities this week to help reinforce the Democratic "brand" as that of the party that deals with economic issues like adults, and that deals with economic issues on behalf of the "other" 98% of us.
Disclaimer: I am not really a fan of the job Clinton did as a President. But Clinton’s political talent and oratory talent are undeniable.
So here’s hoping that Democratic leaders understand the political battle that will be fought over the next several weeks with respect to the economic meltdown, and what to do about it, and that – for the first time in our lives, and after this, forevermore – the framing isn’t completely dominated by completely discredited right-wing ideology.
And here’s hoping Democratic leaders are smart enough to leverage Clinton in putting together talking points, and deploying him as a spokesman.
This is a significant opportunity to corner lots of vampires in a bright sunny place, and to break out the hammers and stakes.