THE BLOG

The Economic Debate Has Yet to Target Key Issues

06/24/2008 05:12 am ET | Updated May 25, 2011

New York: There is still an air of unreality in the economic debate that is increasingly dominating the election.

For one thing, it is still "AAU" (All About Us) as if what happens in the US economy in a globalized world is somehow separate and disconnected to what happens to people "out there."

It is as if our growing deficit, subprime crisis, and dropping dollar only affects the United States. Of course, that's not true. OPEC has blamed the rising price of oil on speculators, the subprime scandal and the deliberate decline of drop the dollar.

The gigantic movements protesting US trade policy in South Korea shows that people worldwide do not want to be controlled by US corporate policies. All around the world, workers are also challenging rising gas prices. AFP reports:

"Auto plants in Spain were paralyzed and Portugal's main airport banned planes from refueling Wednesday as a third day of strikes by thousands of truckers caused heightened chaos and shortages.

Truckers in Thailand also threatened to strike next week while their counterparts in South Korea plan to stop work on Friday, as the outrage over soaring fuel prices intensified around the world."

So far, there has been little protest in the US. We are too busy watching prices go up on TV, focusing on the NBA finals or on horse races on the track and in politics.

Why aren't our leaders encouraging us to act?

Why aren't they offering a global perspective? The truth is that without loans and investments from China, the Persian Gulf and various sovereign wealth funds, our economy would have fallen much further, if not collapsed.

Face it; we do not have energy independence or, for that matter, financial independence. Why? Partly because we live as if we are an island empire in an interdependent world.

So far, planetary issues and global concerns -- climate change, global trade, energy, population, war and peace, and growing inequality have been largely rendered non-issues in our highly partisan economic debates. Last Saturday, the G-8 Finance Ministers meeting in Japan warned that surging oil and food prices threaten the world economy. They blame the collapse of the US housing market as a cause. They offered no solutions.

Speculators are now cashing in. There has been little reference here to what newspapers like Germany's Der Spiegel is reporting:

"After investing in high-tech stocks and real estate loans for years, legions of speculators have now discovered commodities like oil and gas, wheat and rice. Their billions are pushing prices up to astronomical levels -- with serious consequences for ordinary people's quality of life and the global economy."

(Maybe we should "twitter" these words to both campaigns!)

We are hearing mostly about meager stimulus checks, not strategies for sustainability. We are bombarded with polarizing issues, not probes into the interests behind them.

John McCain, the "free marketer" is blasting Barack Obama as a tax and spend liberal. Obama derides McCain for pushing tax cuts for the rich.

So far this sounds like just about every presidential race of the last 30 years, featuring the classic Democrat-Republican debate with the former posturing as populists and the latter claiming to stand for individual freedom.

What's missing of course is that this verbal duel is taking place in the middle of unending wars and three global calamities -- food, fuel, and finance -- that so far have not been really popularized or discussed with the voters.

Obama has touched on the housing crisis and the stranglehold that credit cards have over many of us. The AP reports:

"He would bar credit card companies from raising interest rates without the borrower's approval and from applying higher rates retroactively; establish a federal credit card rating system; and bar interest charges on items such as late fees."

This is a needed reform but does not address the consumption addiction in our country that leads us all to pile on more and more debt. Maybe Obama can't see that because, as he told CNBC: "Look. I am a pro-growth, free-market guy. I love the market."

McCain, meanwhile, as politicians tend to do, changes the subject and goes after Obama for suggesting that an end to NAFTA could hurt business. There's little concern about what this trade deal has done to American workers.

Explains Huffington Post blogger Jayne Stahl:

"Since 2001, the U.S. has lost more than 2 million manufacturing jobs, and nearly 1 million professional, and information service, positions, and NAFTA trade deficits alone have resulted in the loss of hundreds and thousands of jobs."

Nor does it come as breaking news to most of us that real wages have stagnated in the past thirty-odd years, and have actually fallen in the past year. ...It's the same old song, since the great Depression, of the rich getting richer while the rest of us shine their shoes, but not since the 1920's has the disparity between rich and poor been this great.... If things keep up at this rate, the U.S. Treasury may have to declare bankruptcy."

What we have here are really structural problems, not subject to clever slogans or minor adjustments. Tinkering won't help much!

Whoever becomes president will inherit a crisis, not a condition. It is the system that's out of whack, not just a policy here or there. The debate on the economy has to explain this to the American people. Don't the candidates see the same articles I do like this one in Banking Times:

"The Bank for International Settlements (BIS), the organization that fosters cooperation between central banks, has warned that the credit crisis could lead world economies into a crash on a scale not seen since the 1930s.

In its latest quarterly report, the body points out that the Great Depression of the 1930s was not foreseen and that commentators on the financial turmoil, instigated by the US sub-prime mortgage crisis, may not have grasped the level of exposure that lies at its heart."

It's time for more of us to start "grasping" the seriousness of the moment.

Recently, China was condemned for "marketization without democratization." How much democratization, accountability or even transparency is there in our private-sector dominated economic system in which most politicians have little leverage. Unelected financiers, bankers and Wall Street firms call the shots.

This is not just a debate over different policies or priorities.

Why are three million families facing foreclosure? Why is inflation shooting ever upwards and unemployment rising. The recession and worse many Americans experienced didn't just happen -- it was caused by policies giving license to white collar criminals and unregulated speculators with the connivance of a media system that dumbs it down instead of smartening us up.

We need more than a debate over policy. We need an investigation and prosecution of the financial buccaneers and a discussion of the kind of fundamental changes that none of the major party candidates are talking about yet. Otherwise...


News Dissector Danny Schechter wrote the forthcoming book on the financial crisis called
Plunder. He directed In Debt We Trust (indebtwetrust.org) Comments to dissector@mediachannel.org