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Bad Times Are Here Again

By Henri - Posted on 18 February 2009

Or How Eight Years of Bush and Cheney Cured the Illusion of Prosperity

We never really recovered from the dot com boom and bust. Pretty much everything that happened in the eight years that just ended was due to an illusion. The illusion was maintained by a whole lot more government spending than taxing. We doubled our national debt in eight years to over nine trillion dollars. Some people think we escaped inflation. If you look at the way the cost of housing rose during those years you will see that we had a vicious form of inflation concentrated in one major area of human need. “The deflation hurts more Mommy; make it go away!!!”

The Democrats do not get a pass just because Bush didn’t encourage them to pay their way during his profligate administration. They could have blocked legislation and forced pay as you go rules on him if they had been willing to fight when he was popular. Remember that? He was once one of our more popular Presidents. What was demonstrated one more time was that you can easily spend your way to bankruptcy. The corollary to that simple idea is that you cannot spend your way to prosperity.

That’s right folks; the premise behind the consumer society is a sham and an illusion. The idea that spending every dollar you have and some that you never had is a good way to live is over. The ownership society has come and gone leaving us all poorer except those who didn’t buy that tripe in the first place. Cash and its cousin cash flow is once again king. Getting turns out to be harder than spending. Laying waste to our powers of discrimination and rational thought turns out to be way too easy one more time.

So let’s all huddle together around the oil drum bonfire and drink a little Silver Satin and talk about the good times. The boxcars are empty and the rail yard dicks are all laid off. Let’s sing a chorus of Happy Days Are Here Again for old time’s sake. If you can remember it we can also sing <The Big Rock Candy Mountain.

If you think the magic of the government check we have just written will bring back that disappeared illusion you are fooling yourself again. We will try everything easy first. That’s human nature. Then we will buckle down and work our way out of this mess. That is after all the only way you build real wealth, you work to create it.