With the help of Dakinikat’s and Riverdaughter’s posts and my own reading, I’ve been trying to understand what is happening to our economy and how that is going to affect Americans. I came across an economist and historian named Michael Hudson who used to work on Wall Street and is now a Distinguished Research Professor at the University of Missouri, Kansas City (UMKC).
Hudson is really good at explaining the financial disaster we are going though, and he does it in plain English. In the interview posted below (taped yesterday in London) Hudson argues that governments around the world are deliberately shortchanging their own economies, because the financial sector give so much to politicians. Here’s the money quote (it appears about 4:54):
“…the largest contributor to the political campaigns is the financial sector, and the government has a choice: they can save the economy or or they can save the creditors who made the bad loans. They’ve said, ‘We don’t care about the economy; we’re bailing out the creditors. That’s our constituency.”
Here’s another interview with Hudson by Amy Goodman of Democracy Now. This one is from February 15. In this interview Hudson explains in more detail why Obama’s recovery plan is “awful.” It is the “greatest transfer of wealth in American history,” and it is turning the U.S. into an oligarchy with a whole new class of wealthy financiers.
In the end, says Hudson, the debts will have to be written off; because you simply can’t get blood from a stone. If people don’t have the money to pay their mortgages, they can’t pay them. In the meantime, Obama is pouring trillions of dollars of our tax money into the banks.
What can we do about it? I don’t know, but I agree with RD and Dakinikat that we all have to get up to speed on economics as best we can. This country is in real trouble, and the “vast majority of baby boomers have accumulated little to no wealth.” These people are close to retirement, and their houses have lost value and their 401Ks are in the crapper.
And the combination of falling house and stock values means that the vast majority of people near retirement have accumulated little or no wealth, meaning they will be almost completely reliant on Social Security and Medicare to support them in their retirement years.
These are the findings of “The Wealth of the Baby Boom Cohorts After the Collapse of the Housing Bubble,” a report by the Center for Economic and Policy Research (CEPR), a non-partisan research firm.
We cannot allow the rapidly developing Obamagarchy to destroy social security and medicare just as we are very likely headed into a Depression that could be worse than the Great Depression my parents lived through. And we are more poorly prepared now than people were at the time of the 1929 crash. In those days, people had some savings. We are really going to have to stick together as a people and remind ourselves again and again that this is our country. It doesn’t belong to Obama or to the bankers. This land is our land.
Filed under: Barack Obama, Economic Blogs, Economy, financial bailout, Financial Meltdown of 2008, General, Recession/Depression 2008 | Tagged: baby boomers, Great Depression, Michael Hudson, Obamagarchy, oligarchy | 72 Comments »