The employment numbers released last week were substantially better than expected; the July employment report showed that the economy added 163,000 jobs. But it also showed that the unemployment rate edged up to 8.3% and that the number of discouraged workers grew. What this means is that we are headed in the right direction, but very slowly.
Another problem is that the Republicans are still around and are hawking the same ideas for the economy that put us in this sorry position in the first place. Whether you believe it or not, we are still trying to recover from the hangover caused by the Republican economy that was in place for eight years before Obama - and to some degree is still there now. When Mitt Romney says that "the unemployment rate is a hammer blow to struggling middle-class families", he is conveniently forgetting that the so-called hammer is being wielded by his own party!
The only way, in fact, that we can fully recover, is if we recognize exactly what went on the 'night before'. Like most drunk fests, the only real requirements for a party to be a success are: a lot of booze, loose morals, and no police to interrupt the revelry. Under the Republicans, we had all three.
Prior to the market meltdown of 2008, capital flowed like booze throughout our system, financing pretty much everything in sight from grossly overpriced radio stations and companies with business models dumber than anything seen during the dot.com era to home loans for people who did not have the credit or income to support a mortgage. As for the loose morals, the banks and rating agencies took more than good care of that, dressing crap up as gold and then selling it to some sucker, while simultaneously placing bets that the cheap gold polish would eventually wear off and reveal the crap underneath; gambling with client and depositor money with a recklessness that even high-rollers at the Bellagio would never exhibit; handing out exorbitant bonuses to senior executives as a reward for the above-mentioned recklessness; and, of course, fixing the LIBOR. And as the evening progressed, the party got even wilder, with people ripping off their shirts and dancing on tables, windows being smashed, furniture being broken - basically a typical Vegas suite party.
So why didn't the police show up? Because the police at the time were controlled by the Republicans, and the ones who were not partying themselves were busy on Capitol Hill, making sure that their friends who were partying would have no reason to be disturbed by the cops. Piece by piece, financial regulations, foreign ownership restrictions, campaign finance limits, and basically the entire foundation of a safe and stable economic system and democracy were dismantled - undoing most of the work done by FDR to create a level playing field for the American people. With few laws on the books for banks, corporations and the wealthy to violate, it became easier for them to party with abandon, which is precisely what they did.
The net result, or rather the climax of the party, was the subprime mortgage crisis of 2008, which brought our financial system to its knees, necessitated an immense taxpayer-funded bailout to prevent catastrophe, destroyed millions of jobs for a long time to come, and led to the creation of even more wealth for the people who made money during the boom period and who could now take advantage of distressed prices to make a killing. Basically, the same people who got us into the mess were the ones who made out like bandits afterwards. The party, it seems, continued, but only for those select few.
For the rest of us, there is only the hangover, as the high unemployment rate and a lingering recession continue to prove. Make no mistake about it, this is still a Republican economy, and we are still paying for the sins of the Bush years. Some would argue that President Obama has had four years to fix the economy, but that is only partially true. What the President has had, are four years of Republican obstructionism and sabotage; four years of efforts by the GOP to institute tax cuts for the wealthy, repeal the much-needed financial regulations embodied in Dodd-Frank, and render the federal government a puppet in the hands of major corporations; four years of having to fight for unemployment benefits, minimum wage, Social Security, and Medicare, and; four years of calculated moves by the Republicans to hamper any economic recovery that could help Obama win re-election.
To be sure, the hangover is wearing off, but like any hangover, the pace of recovery is inversely proportional to the level of partying that transpired the night before. I don't know how long it will take or how much more pain Americans will have to endure before we are fully functional, but one thing I do know is that the last thing I want at this time is another drink...
... or another Republican in the White House.
Sanjay Sanghoee is the author of two thriller novels. Please visit his website www.sanghoee.com for more details and updates.