Stop Being Stupid

[Oli]

Stop Being Stupid

By BOB HERBERT


I’ve got a new year’s resolution and a new slogan for the country.

The resolution may be difficult, but it’s essential. Americans must resolve to be smarter going forward than we have been for the past several years.

Look around you. We have behaved in ways that were incredibly, astonishingly and embarrassingly stupid for much too long. We’ve wrecked the economy and mortgaged the future of generations yet unborn. We don’t even know if we’ll have an automobile industry in the coming years. It’s time to stop the self-destruction.

The slogan? “Invest in the U.S.” By that I mean we should stop squandering the nation’s wealth on unnecessary warfare overseas and mindless consumption here at home and start making sensible investments in the well-being of the American people and the long-term health of the economy.

The mind-boggling stupidity that we’ve indulged in was hammered home by a comment almost casually delivered by, of all people, Bernie Madoff, the mild-mannered creator of what appears to have been a nuclear-powered Ponzi scheme. Madoff summed up his activities with devastating simplicity. He is said to have told the F.B.I. that he “paid investors with money that wasn’t there.”

Somehow, over the past few decades, that has become the American way: to pay for things — from wars to Wall Street bonuses to flat-screen TVs to video games — with money that wasn’t there.

Something for nothing became the order of the day. You want to invade Iraq? Convince yourself that oil revenues out of Baghdad will pay for it. (Meanwhile, carve out another deficit channel in the federal budget.) You want to pump up profits in the financial sector? End the oversight and let the lunatics in the asylum run wild.

For those who wanted a bigger house in a nicer neighborhood, there were mortgages with absurdly easy terms. Credit-card offers came in the mail like confetti, and we used them like there was no tomorrow. For students stunned by the skyrocketing cost of tuition, there were college loans that could last a lifetime.

Money that wasn’t there.

Plenty of people managed their credit wisely. But much of the country, including many of the top government officials and financial titans who were supposed to be guarding the nation’s wealth, acted as if there would never be a day of reckoning, a day when — inevitably — the soaring markets would crash and the bubbles explode.

We were stupid in so many ways. We shipped American jobs overseas by the millions and came up with the fiction that this was a good deal for just about everybody. We could have and should have taken the time and made the effort to think globalization through, to be smarter about it and craft ways to cushion its more harmful effects and to share its benefits more equitably.

We bought into the dopey idea that you could radically cut taxes and still maintain critical government services — and fight two wars to boot!

We were living in a dream world. The general public, and to a great extent the press, closed its eyes to the increasingly complex and baffling machinations of the financial industry, which kept screaming that oversight would ruin everything.

We should have known better. It didn’t require a genius (or even an economics degree) to understand a crucial point that popped up some years ago in a front-page article in The Wall Street Journal: “Markets are a great way to organize economic activity, but they need adult supervision.”

Did Alan Greenspan not understand that? Bob Rubin? Larry Summers?

Now that the reality of a stunning economic downturn has so roughly intervened, we at least have the option of being smarter going forward. There is broad agreement that we have no choice but to go much more deeply into debt to jump-start the economy. But we have tremendous choices as to how we use that debt.

We should use it to invest in the U.S. — in a world-class infrastructure (in its broadest sense) to serve as the platform for a world-class, 21st-century economy, and in a system of education that actually prepares American youngsters to deal successfully with the real world they will be encountering.

We need to invest in a health care system that improves the quality of American lives, enhances productivity, puts large numbers of additional people to work and eases the competitive burden of U.S. corporations.

We need to care for our environment (if long-term survival means anything to us) and get serious about weaning ourselves from foreign oil.

And, finally, we need to start living within our means and get past the nauseating idea that the essence of our culture and the be-all and end-all of the American economy is the limitless consumption of trashy consumer goods.

It’s time to stop being stupid.

http://www.nytimes.com/2008/12/27/op...ef=todayspaper

Just thought this was a great, to the point op-ed piece worth sharing

[thx1138]

I think Herbert should direct his missive to the bozos in Washington DC. They make policy and appropriate the funding. Living from pay check to paycheck most Americans don't know what goes on behind closed doors in the halls of power and could care less until the consequences bite them in the ass. (like the mess we're in right now.)

[DL_NL]

Why should your government think for you?

[Oli]

I think Herbert should direct his missive to the bozos in Washington DC. They make policy and appropriate the funding. Living from pay check to paycheck most Americans don't know what goes on behind closed doors in the halls of power and could care less until the consequences bite them in the ass. (like the mess we're in right now.)

How did the bozos in Washington convince people to buy houses they couldn't afford? Or convince people to invest their money with a person who wouldn't show them how he was investing it?

Was it the government that forced people to buy gas guzzling SUV's? Or to max out multiple credit cards?

This is a piece about returning to responsibility, personally, business wise and in governance. If you want to lay this at the feet of politicians in Washington, you turn a blind eye to the culpability of the average American who believed they could spend what they didn't have, consume beyond a sustainable level and continue taking money out of a house they couldn't afford because the bubble was never going to burst.

[El Nino]

I think Thomas Jefferson said it best: "Government big enough to supply everything you need is big enough to take everything you have ... The course of history shows that as a government grows, liberty decreases".

[thx1138]

The Fed and bush encouraged all this by driving interest rates way below than what was called for.

[hippifried]

Interest rates need to go lower.

[thx1138]

Er, Hippi: ever hear of the Zimbabwe economy?

[hippifried]

I don't buy into supply side economics at all.

[thx1138]

Maybe you'll change you mind when you have to pay $10k for a loaf of bread.