It's the Economy, Stupid

Maybe Bill Clinton was right in his first campaign for the presidency when he promoted a slogan that pushed economic issues to the top of his agenda. Since then, they have been eclipsed and, for years, the fallout from 911, the debate over the Iraq war, and the focus on the impact of the Bush presidency have dominated our attention. But now, economic issues are back with the intensity of a hurricane. They cannot be ignored. And speaking of hurricanes, Senator Chris Dodd has called the sub prime scandal "a 50-state Katrina." In the epicenter of this storm are two words that have tended to be buried: credit and debt.

Usually, when we hear about economic distress, it takes place in someone else's country; often in Africa or some place you have never visited, conjuring up images of desperation and sadness. The same is true when you hear about debt. When rock stars like Bono or Bob Geldof crusade for debt relief, they are doing so, however successfully - and there is a big debate about that - around conditions in what we used to call the Third World and what others refer to as "Developing" Countries, even when they aren't.

What is more rarely discussed is economic deprivation and exploitation in our own country and what we think of as "the West." We may hear stories about individuals with problems, but we rarely hear about deeper economic forces and the institutions that create and perpetuate the problems. Discussions of how our own economy has been transformed in a way that accelerates deep economic inequality and all the suffering that flows from it have been minimal.

Beyond that, there had been an assumption, almost a subtext, in much of the reporting on our economy, that its market system somehow reflected the national order of the universe, the human species' greatest contribution to stability and prosperity. This ideological overlay, sometimes explicit, often just implied, colored our understanding and contributed to a sense of confidence, or should I say false confidence?

In just the short period, three years, in which I began investigating these issues, from 2005 to early 2008, there has been a tectonic shift with the financial system melting down. This has produced convulsive strains in an interconnected, or as the analysts say, "entangled", system, as well as losses in the trillions, and continuing uncertainty on whether or not we can avoid disaster.