The State of the Union is not good. That is actually a considerable understatement. Tonight Barack Obama will no doubt propose policies to jump start the economy and aid those in America's disintegrating middle class, the very people who have been abandoned by his and every other administration since Ronald Reagan. Lip service can not be a substitute for action, yet Americans are supposed to believe over and over again that those in Washington care about them. Nothing could be further from the truth.
The poor state of our Union has far more to with this unbridgeable divide between the government and its people than with government's partisan political divides. Let us put it another way: the tiny gap between Democrats and Republicans pales in comparison with the yawning chasm separating the government's interests and the Public Interest.
If Americans could only grasp this simple fact, and drop the pretense that the government works for them instead of for itself and the special interests it caters to, they (in politics) might stop playing these insidious, duplicitous games. If the public refused to play along, the propaganda-driven soft sell would be replaced by the Iron Fist of the powerful few, which would clarify our situation in a helpful way which seems impossible now. (This was ultimately the lesson of Occupy Wall Street.) Many seemingly insurmountable barriers, like Joe Bageant's media hologram or Paul Krugman's politically partisan and very popular commentaries, preclude the clarity we seek.
This simple point was forcefully driven home in a recent interview Bill Moyers did with David Stockman, who ironically enough served as Ronald Reagan's first budget director. The story is called David Stockman on Crony Capitalism. You can read the transcript, and I've included the video below. I was struck by this exchange that occurred near the end of the interview.
Moyers — You were disaffected with the party of your youth, the Republican Party, because it has because — it’s become dogmatic on so many of these issues and no longer listens to evidence and facts. I’m disaffected with the party of my youth because that Democratic Party served the interest of the working people in this country like Ruby and Henry Moyers. And so many people feel the same way. How do we overcome this pessimism about the American future? The Wall Street Journal had a headline on an op-ed piece that said, "The End of American Optimism." A recent survey said only 15 percent of the people were satisfied about the direction of the American people. I mean, this is a serious situation, is it not?
Stockman — I think it is... But we also have to recognize the pessimism that the public reflects in the surveys and polls is warranted. In other words the public isn't being unduly pessimistic. It's not been overcome with some kind of a false wave of emotion. No. I think the American public sees very clearly the current system isn't working, that the Federal Reserve is basically working on behalf of Wall Street, not Main Street.
The Congress is owned lock, stock and barrel by one after another, after another special interest. And they logically say how can we expect ... anything good to come out of this kind of process that seems to be getting worse. So how do we turn that around? I think it's going to take, unfortunately, a real crisis before maybe the decks can be cleared.
Moyers — What would that look like?
Stockman — It will take something even more traumatic than we had in September 2008.
Moyers — But on the basis of the record, the lessons of the past, the experience you have just recounted and are writing about, do you see any early signs that we might turn the ship from the iceberg?
Stockman — No. I think we've learned no lessons. We really have not restructured our financial system. The big banks that existed then that were too big to fail are even bigger now. The top six banks then had seven trillion of assets, now they have nine or ten trillion.
Rather than go to the fundamentals which have been totally neglected-- we've simply kind of papered over the current system and continued the game of having the Federal Reserve and the Treasury, if necessary, prop up all of this leverage and speculation, which isn't helping the economy.
And when we talk about zero interest rates. That’s not helping Main Street. Our problem in this economy is not our interest rates are too high. The zero interest rates are just more fuel for leveraged speculation, for what’s called the carry trade, and that is causing windfall benefits to the few but it’s leaving the fundamental problems of our economy in worse shape than they’ve ever been.
If you read and understood my introduction to this post, you will immediately see that it makes little sense for Stockman to say "I think we've learned no lessons." Who does "we" in this statement refer to? In government, it is not as though there is a well-meaning intention to do the right thing which has been replaced by incompetence and ignorance (lessons not learned). That's a hopeful interpretation, but entrenched corruption and cynical self-interest are an entirely different kind of beast. We're not talking about selfless public service here.
If Stockman means that a majority of the people—those who vote—have learned no lessons, his statement might be more plausible. Moyers seems to contradict that in the text, saying that only 15% of Americans are satisfied with the direction the country is moving in, but it is also true that one can be dissatisfied while also believing in the fundamental goodness of the government.
I also find Stockman's statement that it will take a crisis even more traumatic than we had in September, 2008 to turn things around implausible. If an even bigger crisis occurred, we would naturally expect more of the same—government bail-outs for the largest banks, unlimited loan guarantees to corporate special interests, no Federal prosecution of financial fraud after the fact, and so on.
The Public Interest would once again take a back seat to the powerful interests which pay to play. America's middle class and poor would take it in the shorts once again. What reason do we have to believe that anything would change in the aftermath of the next crisis? None, as Stockman admits about our current circumstances. What part of the confluence of "money", "power" and "corruption" do Moyers and Stockman not understand?
I do not mean to be overly critical of Bill Moyers and David Stockman. They are good men who I have sometimes quoted on DOTE. However, I think it is imperative that we strip away all the illusions (and delusions) which prop up the sociopolitical status quo in the United States. If change is indeed possible, and that's a Big If, it will only come in the harsh glare of the light Reality casts on our predicament.
Thus we can say in January, 2012 that the state of our Union is not good. If I were a betting man, I would say it will get much, much worse as the future unwinds and our lives unravel. As things stand, I think that it a grievous mistake to believe that an even larger crisis than we had four years ago would change anything important in the way Americans are governed. Why would a second crisis achieve what the first did not? The first crisis was clarifying in the way I've explained here, but apparently not clarifying enough.
It is far more likely that another big meltdown would merely push those in the middle class and the poor into a situation so desperate that we would see the complete disintegration of American society, a process which is already well underway. There would be little left to lose. The United States would become a Failed State. Whether anything good might come out of that disaster is an open question, but I doubt it.
Bonus Video — The Moyers/Stockman interview