Echoing a prediction I made in late 2008, NYU economist Nouriel Roubini now foresees 10% unemployment. We are talking here about official unemployment, measured in the highly conservative and unrealistic manner now standard with the Government that only counts those still hopeful enough to be actively looking for work. Real unemployment may already be around 15% (it's hard to count those who are hiding in their basements doing nothing but penning sarcastic blogs). Roubini recommends temporary bank nationalization. He also predicts U.S. GDP around zero, which to me seems wildly optimistic, given the continuing predatory behavior of the U.S. political/financial elite.
If Bush had done the patriotic thing and resigned last October and been replaced by a non-partisan caretaker government that put financial policy in the hands of a committee of experts not responsible for creating the disaster (e.g., Stiglitz, Krugman, and Roubini), then the bailout theft (engineered by Wall Street gamblers on loan to Washington) might have been replaced by a program of small-business loans. Such a program would have left the rich standing in unemployment lines, but it would have generated a boom in genuine economic productivity. Do you need to be remined that the rich (e.g., Paulson, Geitner) were spending their time playing with other people's money in order to skim off a percentage; they were NOT producing. Production starts with Moms and Pops hammering stuff for their neighbors, and it does not take a very big loan to support that sort of work.
The second policy such a responsible caretaker government might have implemented would have been a federally financed program to rebuild American infrastructure - not to generate jobs but because it needs to be rebuilt. Unemployed bankers could have been put to work flagging traffic through the construction sites. I did that as a kid. Even a financial wizard is capable of learning how to do it.
But there was no honest admition from Bush of his incapacity to govern. There was not even a "throw the rascals out" election. Instead, the same political/financial elite that has always controled Washington remains in power. The lunatic fringe we like to style "neo-conservative" may have been booted out, but the elite they came out of remains firmly in charge.
Roubini is known as a pessimist. After all, he's the one who famously predicted the recession. But unless Americans awaken from their slumber and demand good government, I fear he will go down in history as an optimist. By the way, he calculates the DOW may hit 5000. I would simply point out that the original market crash last fall occurred because of bad news shocking everyone out of denial. This time it would happen because we have actually spent the last six months analyzing the situation and now all realize that all the evidence, given financial world corruption and political world incompetence (not to mention the reverse), points to things getting a lot worse.
If Bush had done the patriotic thing and resigned last October and been replaced by a non-partisan caretaker government that put financial policy in the hands of a committee of experts not responsible for creating the disaster (e.g., Stiglitz, Krugman, and Roubini), then the bailout theft (engineered by Wall Street gamblers on loan to Washington) might have been replaced by a program of small-business loans. Such a program would have left the rich standing in unemployment lines, but it would have generated a boom in genuine economic productivity. Do you need to be remined that the rich (e.g., Paulson, Geitner) were spending their time playing with other people's money in order to skim off a percentage; they were NOT producing. Production starts with Moms and Pops hammering stuff for their neighbors, and it does not take a very big loan to support that sort of work.
The second policy such a responsible caretaker government might have implemented would have been a federally financed program to rebuild American infrastructure - not to generate jobs but because it needs to be rebuilt. Unemployed bankers could have been put to work flagging traffic through the construction sites. I did that as a kid. Even a financial wizard is capable of learning how to do it.
But there was no honest admition from Bush of his incapacity to govern. There was not even a "throw the rascals out" election. Instead, the same political/financial elite that has always controled Washington remains in power. The lunatic fringe we like to style "neo-conservative" may have been booted out, but the elite they came out of remains firmly in charge.
Roubini is known as a pessimist. After all, he's the one who famously predicted the recession. But unless Americans awaken from their slumber and demand good government, I fear he will go down in history as an optimist. By the way, he calculates the DOW may hit 5000. I would simply point out that the original market crash last fall occurred because of bad news shocking everyone out of denial. This time it would happen because we have actually spent the last six months analyzing the situation and now all realize that all the evidence, given financial world corruption and political world incompetence (not to mention the reverse), points to things getting a lot worse.
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