
Friedman writes that we are now in our third decade of being on the wrong path, a sad trajectory which began with the Reagan Revolution of the 1980s. Whereas we initially responded to the oil embargoes and gasoline shortages of the '70s by imposing higher standards of fuel efficiency on our automobiles, under Reagan we backslid from that initiative, only recently to begin moving in the right direction again.
Under Reagan we began believing that government supposedly is not the solution to the problem, government is the problem ... and we (often in the name of opposing governmental "tyranny" over our private lives) enshrined economic deregulation and market values instead.
Friedman's book appeared a few months before the recent meltdown of our financial markets. His words, however, were prescient:
In some ways, the subprime mortgage mess and housing crisis [which has since triggered the financial meltdown] are metaphors for what has come over America in recent years: A certain connection between hard work, achievement, and accountability has been broken. We've become a subprime nation that thinks it can just borrow its way to prosperity — putting nothing down and making no payments for two years. Subprime lenders told us we could have the American dream — a home of our own — without the discipline or sacrifice that home ownership requires. We didn't need to study hard and build a solid educational foundation. We didn't need to save and build a solid credit record. The bank around the corner or online would borrow the money from China and lend it to us — with a credit check no more intrusive than the check you get at the airport when they make sure the name on your airline ticket matches the one on your driver's license. When the whole pyramid scheme, operated by some of our best financial institutions, collapsed [well, when it first gave signs of collapsing!] everyone from simple homeowners to unscrupulous lenders looked to the government for a bailout [you ain't seen nothin' yet!]. The politicians accommodated them, even though everyone knew that the lenders had not been betting that their customers' penchant for hard work or frugality or innovation would enable them to make the payments. They were simply betting that the housing bubble would keep driving up the prices of homes and that mortgage rates would keep falling — that the market would keep bailing everybody out forever. It did — until it didn't. As with our houses, so with our country: We have been mortgaging our future rather than investing in it.
Now, just months after the book appeared, the bill has come due. We've learned to our chagrin that unchecked market forces can impose their own tyranny. Government intrusions supposedly amount to tyranny, say some, though I'd say it's a benign tyranny of regulation, order, and control; when markets go kerflooey, we endure a toxic tyranny of chaos. We can name our poison.
With the election of Barack Obama, we have chosen regulation, order, and control over chaos. Obama says he wants an "Apollo program" for energy ... which is exactly what Friedman means by Code Green for the restoration of American preeminence:
[Code] Green is not simply a new form of generating electric power. It is a new form of generating national power — period. It is not just about lighting up our house; it is about lighting up our future.
No comments:
Post a Comment