Starting with the Republican National Convention last month, there has been many people asking “Are you better off now than you were four years ago?”
And it got me to thinking about my situation and whether I am or am not better off.
- Four years ago, the general public was blissfully and mercifully unaware of how very close our entire financial system came to bringing this country to its economic knees. (They still neither really know or appreciate the seriousness of the crisis, and as a result, efforts to reform the system and prevent future meltdowns has been largely ineffective.)
- Four years ago this weekend, I was sending messages to my immediate family and to my in-laws telling them to go to the bank and get a couple thousand dollars in cash, because I was no longer confident about which of the nation’s banks would be able to open their doors on Monday, or if they’d bother to fill the ATMs with cash.
- Four years ago, I was racing around moving money to banks that were likely to survive–those that I thought were too big for the government to let them fail.
- Four years ago, I was on the verge of losing my job for what would turn out to be a 16-month period, as the financial system completely melted down and economic activity slowed dramatically.
- Four years ago, the financial system failed. No one trusted anyone else. Intra-bank lending ceased. Markets were not functioning at all, let alone anywhere close to normal. It was a total collapse. We were staring into the abyss.
- Four years ago, all the defanging of regulatory regimes and the hopes that market forces would correct all excesses without killing us came crashing down. Even our Randian Chairman of the Federal Reserve, Alan Greenspan, admitted that his long-held theories of market operations were proven incapable of explaining what happened, let alone preventing it. The markets corrected all right–all at once! when everyone ran from one side of the boat to the other, causing it to tip over.
- Four years ago, it was every man for himself until the government and the Fed recognized the folly of letting the market work its unhindered magic.
I’ve now been re-employed by two separate firms in jobs that while perhaps not what I would ideally want to be doing, will suffice. The financial system is operational. Money is moving among the various players in the industry and between lenders and borrowers. The financial system has been saved. It’s far from perfect, and, as noted, some of the efforts to prevent future problems have been ineffective and off-base. But it’s working.
So, for me, the answer is most definitely YES. I am better off than I was four years ago. Whether we as a nation are better off is a slightly different question–but not one that the Romney camp is asking, yet.
The question that this line of argument from the Romney campaign raises is: Are they sure they really want to be asking this question? Most of the bullet points referenced above relate to the events of “Lehman Weekend” when Lehman Brothers was allowed to fail, Merrill Lynch was gobbled up by Bank of America, AIG failed, Fannie and Freddie were put into conservatorship, and all hell was breaking loose.
The anniversary of Lehman, et al. works against Romney, not for him. The non-regulatory framework, their undying belief in only-market forces that he advocates is precisely what led us down the path to the disaster that befell the financial industry. The excesses that built up were not effectively managed by the market.
Did the Romney campaign not have access to a calendar that showed September 2008? Did they not remember the headlines and front pages like this one?
What are they thinking by pursuing this line of argument? Or are they thinking at all?