The Politics of Economic Depression

I think that today's politicians are too tempted to game the system. Leaders in the 1930's may have seen a real need to fix things becuase their personal fortunes were on the line. today's leaders can benefit from an economic collapse in ways that the rest of us can't.

reply to post by Justin Oldham

I think that today's politicians are too tempted to game the system. Leaders in the 1930's may have seen a real need to fix things because their personal fortunes were on the line. today's leaders can benefit from an economic collapse in ways that the rest of us can't.

Well, for sure the ethics of the 1930s are not the same as those of the 2000s. Of course, there was a uniting factor in the 1930s - everyone was in dire trouble - that is not present today. As you have pointed out. “Those that has, gits!”

Question: Now that Federal authorities have hte green light to bail out and take ownership, how far will they go? What else will the Feds buy in to? Auto industry? Energy? Agriculture? What's your best guess?

Originally posted by Justin Oldham
What else will the Feds buy in to? Auto industry? Energy? Agriculture? What's your best guess?

My best guess is that those in power would leave the US agricultural sector and auto industry alone because they are already under the government thumb of subsides . I cant say I know enough energy sector to comment .

Cheers xpert11 .

We might need a response from Don on this one. I'm not sure that any future administration, regardless or affiliation, would deny itself the opportunity to manage any segment of the economy. Now that the precedent has been set, it seems unlikely that any sector would be immunie to Federal involvement.

I’ve recited a small number of the actions taken against the poorest of our society, yet even under such dire circumstance, no one revolted. I think the reason for that was this: those people still believed in the basic honesty and decency of the American system. And they had faith they would see better days. All of which is to say, it will have to get very bad before we see uprisings.

No one revolted then. Why? I think one of the biggest reasons was the lack of mass communication networks to relay that kind of info. But eh, it might not be that different in the future when they close internet or turn it into a control grid like they are doing in China, Britain and Australia.

But today, there's also the new ``non-lethal`` weapons, the propaganda medias... but there's youtube and the millions of private cameras that can record events, and post them on internet to report what's going on... which since internet was popularized, destroyed the trust of the people in the government.

But the government also have the medias to propagandize their ideas. Like... stage some violent protesters killing police, renforcing the gang mentality of the police, us VS them BS...

In the end, what will decide how this turns out will be how much people believes the medias VS those who knows what's going on.

[edit on 18-10-2008 by Vitchilo]

reply to post by Justin Oldham

We might need a response from Don on this one. I'm not sure that any future administration, regardless or affiliation, would deny itself the opportunity to manage any segment of the economy. Now that the precedent has been set, it seems unlikely that any sector would be immunie to Federal involvement.

It is my sense that current Democratic philosophy (or ideology) does not include state ownership of any business nor of any industry. I am even convinced - post Clinton - that the Dems will go for a “reform” and not ask for a “replacement” of the current system where the REGULATED is required to do most of the fact gathering and reporting.

Let’s guesstimate a moment to show what I have in mind. The Commodity and Futures Trading Commission - CFTC - for example. Story is that when Reagan took office in 1981, the CFTC had 4,000 employees. Their website says they have 405 today. At the same time the staff has been sharply reduced - if not to say gutted - the volume of trades to be overseen has quadrupled or quintupled. One could make an argument for going back to the original number X 4 or X 5.

No matter who you are, it would take a lot of time to hire and train new personnel to “man the ship.” Because 100% of the trading is now done on computers, it seems better to update the hardware and write appropriate software so the traders will create the right kind of trail and the CFTC regulators can “watch” the whole amount of trading yet be alerted to those trades that might infringe on various laws against insider trading or “loading” the system to create artificial conditions that favor either the buyer or the seller.

I’d like to see a flat rule that NO trading in futures in Food, Energy and Finance would be allowed to anyone who is not in that particular industry. In other words, Cargill can buy wheat futures but Bear Sterns cannot. It’s my opinion reinforced by the hearings seen yesterday on CSpan conducted by Sen. Chris Dodd - he is so informed on this banking topic - on new regulations of the mortgage industry. Catch those if you can.

Even the much neglected food industry - especially meat processors - we can make do today with fewer on-site inspectors than were in use prior to 1981. As I have mentioned before, it was a law then that the plants could not begin to operate until the FDA or USDA inspector was physically on the site.

Again, because so much of even meat processing has been changed to modern methods that allow of infra-red sensors, tv cameras and temperature and humidity gauges, I can image how a meat plant might get by with periodic inspections based in part of monitors and in part on daily samples taken to the FDA or USDA labs for testing as to purity and cleanliness. In other words, the inspectors should be as much up to date as are the processors.

Your historically based fears may be outdated, Mr J/O.

Now that the specter of State ownership has been unleashed...by Republicans...I'm not sure that the genie can be put back in to its bottle. How can the proponents of Federalism NOT embrace it? Now that the precendent is iin place, it seems likely that future Democrats will make the most of it. If they are 'sucessful,' we could see future Republicans going along to get along.

Bear in mind that "success" for a State owned enterprise will be judged differently than it would be for a privately held company. It's two decades away, but we should expect Federally held firms to support and encourage bloated bureaucracies. Those of you in Federal civil service right now will know what I'm talking about.

reply to post by Justin Oldham

Now that the specter of State ownership has been unleashed...by Republicans...I'm not sure that the genie can be put back in to its bottle. How can the proponents of Federalism NOT embrace it?

How? Well J/O, it is true that I live a lot “in the past.” It looks as if you have joined me. Just as my 12 year old grand-niece who was first on her block to have an iPhone and has had one now for over a year, she is a light year ahead of me in operating such a device. So also is the millennium generation ahead of us “old timers” who like to harken back to the good old days.

That’s not because the old days were in fact so good, it is because we know more about those days than we know about these days. And people are always comfortable with the familiar. So our comfort zone puts us too often looking “backwards” instead of looking “forward.” You know the rule in electronics, “double the capacity, halve the cost every 18 months.” For you and me this is progress at a rate we have never before experienced. It’s mind boggling. But it’s real and it’s happening all around us.

Therefore, I repeat, we Dems have moved on. We are not going to nationalize the steel industry, the coal mines and the railroads. As the Brits under Clement Atlee did in 1946. And he - say Labour - also created the national health service, known then as now as the NHS. Nationalized industries failed not because of some philosophical imperative against state ownership, but because the industries were worn out, depleted and unprofitable to operate in 1946.

If Labour could have seized the industries in 1906 instead of 1946 when easy profitability was still there, it might well have been a different outcome. By the 1950s the British Government was ready to return the heavy industries to their former owners.

But not then, and not now, are the British people willing to give up the NATIONAL HEALTH SERVICE. If anyone harbors any doubt about that, just ask Margaret Thatcher! A British Neo Con, if that could have been done, she would have done it! You can be sure!

Now that the precedent is in place, it seems likely that future Democrats will make the most of it. If they are 'successful,' we could see future Republicans going along to get along.

Well, it looks as if the home industry has replaced the auto industry as the most significant industry in America. Whereas once cars pulled the engine of our economy, it is now the home industry in all its variations. New construction. Remodeling old buildings. Repairs caused by age or from natural events. Additions as families enlarge or needs or preference change. Room for an indoor hot tub for example instead of outdoors in the back yard. Turning carports into enclosed garages. Then turning those into play rooms. Knocking down inside walls to make a GREAT room. And etc.

So why not nationalize the owner occupied home mortgage industry? Would it not be better than leaving it in private hands who are profit driven? Actually, the home mortgage business has been “nationalized” since 1933. Problem is we abandoned the rules that worked for a half century. We experimented with a crazy scheme to let the market rule. That trip to the Neo Con’s economic Disneyland will cost us $2 t. to $7 t. Let’s not try that again.

When an industry becomes central to the national economy should not the nation be involved? And who can best represent the nation? We don’t have to re-invent the wheel. We already have all the necessary implements in place. The FHA, and whatever Fannie Mae and Freddie Mac stand for. See Note 1.

Bear in mind that "success" for a State owned enterprise will be judged differently than it would be for a privately held company. It's two decades away, but we should expect Federally held firms to support and encourage bloated bureaucracies. Those of you in Federal civil service right now will know what I'm talking about.

Not necessarily. There were good reasons in the past for what looked to critics to be BLOATED bureaucracies. It’s called SERVICE. Suppose you live in a small town. Not one as small as Wasilla (see Note 2) but in say, Glasgow, KY, a city I’m personally familiar with. The city’s population is 14,200 (2000) but the surrounding area including Barren County of which Glasgow is the county seat has 51,452 population per the official 2007 estimate. en.wikipedia.org...

Such offices as US Department of Agriculture’s County Agent, the Public Health Service’s Nurse, a TB screening facility, a Federal courthouse with its attendant clerks, the IRS, FBI, Armed Forces Recruiting Service, a Social Security office, a Department of Labor OSHA representative. And I could go on but I’m trying to illustrate that people in small towns want and need and have a right to expect a reasonable level of service that may not always be as efficient of personnel as in the large cities.

A BLOATED bureaucracy may not be the worst thing in the world! For one very important thing, surplus personnel are at the ready to go to New Orleans when another Katrina strikes. Or to the Texas Gulf Coast if another Ike should hit it. And it will! It is not in the nature of government - SERVICE - to always be 100% efficient. But is is always needed! Think of it more as the cost of doing business - and doing it WELL.


Note 1. The Federal Home Loan Mortgage Corporation (FHLMC) (NYSE: FRE), commonly known as Freddie Mac, is a government sponsored enterprise (GSE) of the United States federal government. The FHLMC was created in 1970 to expand the secondary market for mortgages in the US. Along with other GSEs, Freddie Mac buys mortgages on the secondary market, pools them, and sells them as mortgage-backed securities to investors on the open market. This secondary mortgage market increases the supply of money available for mortgages lending and increases the money available for new home purchases. en.wikipedia.org...

The Federal National Mortgage Association (FNMA) (NYSE: FNM), commonly known as Fannie Mae, is a stockholder-owned corporation chartered by Congress in 1968 as a government sponsored enterprise (GSE), but founded in 1938 during the Depression. Contrary to some beliefs, Fannie Mae does not make home loans directly to consumers, but rather functions as a leading participant in the U.S. secondary mortgage market. en.wikipedia.org...


Note 2. The Wasilla website gives the 2004 estimated population of 7,738 over the 2000 US Census of 5,469. The website does not say how made the estimate. www.wasillaalaska.com...

[edit on 10/21/2008 by donwhite]

"hen an industry becomes central to the national economy should not the nation be involved?"

An interesting choice of words. I do think we are seeing a change of thought. "National interest" is being re-defined. In the past, our leaders defined themsleves as benevolent guardians. today, they now define themselves as the keepers of the national interest. We're just one step away from claims of "we know what's good for you." that ultimately leads to "because we said so."

the line between regulation and oversight and ownership and operation is very wide and thick. It takes a deliberate effort to cross that line, knowing full and well what the consequences are. The most real of real conspiracies that I know of would be this trend towards increased government intervention in to...everything. In the next decade, we're likely to see the legal concept of Privacy" thrown out because our leaders have no longer deemd it to be in the national interest.

Bear in mind that once the State controls and industry, it decides what is right and proper for that industry. Historically, that has always meant a profound lack of innovation. Stagnation may be good for politicials, but its not good for the rest of us.

reply to post by Justin Oldham

DW said: "When an industry becomes central to the national economy should not the nation be involved?"

An interesting choice of words. I do think we are seeing a change of thought. We're just one step away from claims of "we know what's good for you." That ultimately leads to "because we said so." In the next decade, we're likely to see the legal concept of “privacy” thrown out because our leaders have no longer deemed it to be in the national interest.

Well J/O, for sure somebody must tell the bankers and brokers what is “good for you.” Or good for us. Milton Friedman, you get a great big -F- for what you told us!

On privacy. One of the 2 pillars on which Roe v. Wade rests was the “right of privacy.” Mentioned in prior cases, it was laid out in more detail in Roe. That right the Court said, meant the state could not involve itself in your private life without a COMPELLING state interest. Whether or not a woman has an abortion obviously does not rise to the level of a “compelling” state interest.

Warrantless electronic eavesdropping also violates a person’s right of privacy. Let’s hope the Patriot Act is repealed in it’s entirely. We can then start over to grant necessary powers to our security apparatus on a case by case basis.

I don’t think the Dems are likely to throw out Roe. GOP yes, Dem no.

[O]nce the State controls any industry, it decides what is right and proper for that industry. Historically that has always meant a profound lack of innovation. Stagnation may be good for politicians, but its not good for the rest of us.

First, it may be irresponsible for governments to experiment. When unpredictable but potentially adverse national consequences may be caused, certanly caution is to be the by-word for governmental actions. And I’d add, similar experimentation by private companies that are so large “they cannot be allowed to fail” also must come under similar restraint. For a quick fix, I’d recommend we make a list of such companies now, in a calm atmosphere, instead of waiting until they are falling all around us. Bear Sterns yes, Lehman Brothers no. How’s that go?

[edit on 10/22/2008 by donwhite]

The Democrats are about to get their turn at bat. Only time will tell if they can live up or down to the expectation you and I have laid out here. For my part, I am prepared to criticize or to give credit where it is due.

reply to post by Justin Oldham


Really it is a given the we elected leaders who's job it is to look after the National Self Interest . Sure the people have a responsibility to be a good citizens but unless you live in a direct democracy only the government can decided if your country goes to war and so on . I would love it if the private sector could be trusted to rain infrastructure and commercial operations that are in the national self interest with only a degree of regulation but the reality is often very differnt .

While I'm not crazy about the NZ government having brought back the country rail system I am nevertheless willing to give government ownership a go .
Why you might ask ?
A long story short which is required to stay on topic after privatisation the private sector totally and utterly trashed the NZ rail system.

reply to post by xpert11

While I'm not crazy about the NZ government having brought back the country rail system I am nevertheless willing to give government ownership a go. Why you might ask? A long story short which is required to stay on topic after privatization the private sector totally and utterly trashed the NZ rail system.

The only part of our health care delivery system that is worthy of duplication is Medicare and the VA. Each 100% government (taxpayer) funded.

Since 1946 and the UK's NHS, Americans have been ceaselessly viciously propagandized to HATE their own government. That may ultimately prove so deeply embedded as to make it impossible to FIX our lousy system.

That system my friend is what we called FASCISM when it was done by Mussolini and Hitler. It’s called FREE MARKET when done by Merck, Pfizer and GlaxoWelcome.

Please be advised that ATS is going to close the CM forums. I'm posting this message so that the site owner's decision doesn't take you by surprise.

reply to post by Justin Oldham

The Democrats are about to get their turn at bat. Only time will tell if they can live up or down to the expectation you and I have laid out here. For my part, I am prepared to criticize or to give credit where it is due.

Eight days to go in October. 3 days in November, then we vote. Thank you Lord God that it will finally be over! If you really LOVE us God like you say you do, You will never ever let this 20 months campaign happen again! Surely everyone has earned enough CREDITS to go straight to Heaven now. Back when smoking was so popular nearly everyone did it, Tex Ritter sang a song the words of which went like this,
“Smoke, smoke, smoke that cigarette,
tell St. Peter at the Pearly Gate,
he’s just gonna have to wait
while you smoke another cigarette.”

A poll mentioned on the PBS Jim Lerher News Hour said 3 out of 4 voters expect Obama to win. And HISTORY will be made! You can tell your grandchildren you were alive when it happened! I predict by 2040, all the “old timers” will claim to have voted for Obama! Don’t miss your chance November 4. Oh me? Shucks I voted 3 weeks ago by mail-in ballot. There are 38,000 votes still missing from Orlando in 2006. Give ma a paper ballot.