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Friday, December 3, 2021

The Sterling Compass

This summer while interning for Speaker of the House Nancy Pelosi’s office in Washington, D.C. one of my main duties was answering the thousands of phone calls from people from all over the country. The phone calls ranged from a sweet-sounding old lady who assured me that global warming was just God’s way of hugging us closer to a man who spent 20 minutes trying to convince me that the Soviet Union had not actually collapsed. But in between the calls from the crazies, I heard first-hand the desperate voice of America. Because of high gas prices, a grandfather from West Virginia could not afford to make the drive to visit his grandchildren. A single mother from Wisconsin had lost her job and her life savings and didn’t know how she would feed her children. The people were drowning and there was not a lifeboat in sight. Many of you have probably been wondering how we, the United States of America, the wealthiest nation on Earth, came to this. Why is the system failing?

Prior to the Great Depression of the 1930s, laissez-faire economic principles ruled the United States economy. This ideology allowed commerce to flourish, but the increased wealth was not fairly shared. The business elites who relied on workers to build their economic empires were reluctant to share their success. Prices increased, profit margins exploded, but workerswages remained stagnant, cutting out a majority of the population from enjoying the fruits of their own labor. Eventually, the middle and lower classes did not have enough money to purchase goods in the growing markets and demand fell. This, combined with the bank failures and a lack of deficit spending, created a snowball effect that nearly destroyed the nation. Roosevelt’s New Deal and World War II resuscitated the economy through increased government spending and unprecedented social programs. When wealth was scarce, the average person supported programs uplifting the poor and sharing more and more of the economic pie and the government was seen as a protective friend.

After WWII, the U.S. found itself in an unprecedented era of prosperity. If you looked past the fear of nuclear annihilation, life was good. The booming economy gave birth to a new middle class and eventually an upper-middle class that soon turned on the New Deal ideology. The 1970s saw a global economic downturn, intensified by OPEC’s oil embargo. Much like today, gas prices skyrocketed and the economy faced stagflation; intense economic slowing and high inflation. Riding to America’s rescue on his papier-mâché white horse was none other than Ronald Reagan. Reaganomics. And then the New Deal died.

The Republican Party patented Reaganomics and it has dominated U.S. economic policy ever since. Big government is bad. Reduce government regulations. The free market is good. Cut taxes to the wealthiest of the wealthy. Cut government spending to social programs but spend billions on the military. Sorry, working poor, you’re on your own. Take that, Soviet Union, see you later. And thus it continued through Bush Sr., Clinton, and our beloved Bush #2. And it worked. Businesses boomed. Economic growth, intensified by the dot com explosion, seemed to confirm the conservatives formula for success.

That brings us to the present day. Just as unregulated capitalism nearly destroyed us once before, it threatens to do it again. Wall Street is a casino for the insanely rich who gamble terrifying quantities of money on a daily basis. Unrestricted capitalism breeds unrestricted greed. The middle class is dying and with the rising cost of living, most Americans don’t have the means to purchase the products being produced. The banks are failing. Social programs have been cut left and right but we spend over $12 billion every month in Iraq and Afghanistan. Sound familiar? Conservative sink or swim ideology is ruining millions of American lives. We need to start investing in the American people. This crisis won’t be solved with four more years of the same. Ask Colin Powell or billionaire Warren Buffett. Think about that when you enter the voting booth two weeks from today.

 

MICHAEL HOWER would really like to not graduate in spring on the verge of a legendary economic collapse and would appreciate it if you would vote for someone who actually has a plan to fix things. You can reach him at mahower@ucdavis.edu.

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