After World Wars I and II, The United States of America came to view itself as a great, if not the greatest, military force on this planet. Having defeated Germany, Italy and Japan in these hard fought wars, we saw ourselves as a great power, a great defender of right and freedom in the world. And we were. We were soon countered by the growth of Communism and the rise of the Soviet Union and the “Iron Curtain.” We began to see militarism as part of the American character. American corporations began to grow rich on developing and supplying weapons and arms around the world. President Eisenhower warned America in the 1950’s of the “Military Industrial Complex,” but no one was listening. America was becoming rich and full of itself. As a people, we became believers that military might makes our actions in the world right!
This belief has led us into conflicts and wars that were costly, not just in money, but in American lives and ultimately in America’s image in the world. Korea, Vietnam and the Gulf War were costly and ultimately led to American defeat or stalemate. These wars began with American hubris and seemed to end with our trying to find a way out of a quagmire, to “save face” for American pride and justify the expense and loss of life. In too many ways, Iraq and Afghanistan, the longest wars in U.S. history, are no different. These were wars of our making against stateless enemies with no boundaries and goals that were never clear. America will have to wait and see if there are winners or losers here. Clear victories and goals achieved will be subjects for debate among future historians. The U.S. is currently spending $10 BILLION a month on Iraq and Afghanistan at a time when Americans are calling for spending cuts and tax increases to deal with an unimaginable national debt in the TRILLIONS of dollars. The belief in “might makes right” was and still is an American tragedy.
Big Business vs. Unions
At the dawn of America’s Industrial Revolution, our country began to see the migration of workers from rural farms to big cites in search for industrial jobs. American industry needed masses of cheap, expendable labor to work in factories and mines that could produce large quantities of manufactured goods not only for the United States, but for the world. American big business was being forged in this revolution. The image of large smoke stacks belching out thick, black smoke became America’s symbol for prosperity and progress. The output of American factories and mines began to rival the world. Companies and corporations became rich and powerful, but at a growing cost to the American worker. Images of child labor, sweatshops and unsafe working conditions called out for the creation of labor unions. Big business seeking to maximize its profits fought long and hard against the unions, but in the end unions prevailed. American business and industry now had to contend with new laws, new regulations in regards to their workers. For the first time, American workers could bargain for better wages, better working conditions and benefits. American union bosses grew rich and powerful on dues paid with a growing union membership. Soon they rivaled the captains of industry for power and influence in Washington. The pendulum swung to the unions, but not without a price. American products were becoming too expensive on the world market. American workers were becoming lazy and complacent in union protected jobs that did little to improve innovation and productivity.
The animosity between big business and unions continued to grow until big business found a way out. By sending American production overseas to third world countries, American companies could take advantage of the cheap, expendable labor, free from troublesome labor laws and unions. China and India proved to be a “gold mine” for American industry. The cost of shipping these cheaply produced goods back to the U.S. could easily be offset by the lower cost of labor and production in these countries. Big business was able to influence Washington to give out tax breaks and write laws that not only protected large corporations, but encouraged them in this migration of American jobs overseas. Familiar American companies and corporations began to disappear or merge with larger and now multi-national corporations. These huge corporations began to have decreasing ties or allegiance to American coffers and taxpayers. Today, some of these monoliths, like GE, pay no taxes at all, while receiving huge American tax credits. China and India’s economies began to flourish, while our balance of trade with them continued to grow in their favor, increasing our national debt. A truly global economy was being born. It was extending far beyond American shores. The pendulum was swinging back to big business in a very big way leaving American unions wondering about their relevancy in this new global economy.
The cost of this swing has been devastating to our country. American manufacturing jobs have steadily declined leaving shuttered factories and deteriorating infrastructure in its wake. Unemployment in America is now over 9% and millions of American workers are scrambling for fewer and fewer available jobs. The cost of higher education and college degrees are steadily increasing beyond the average American’s ability to pay for them. More and more, the jobs that remain here require a greater level of education and training than our crumbling public school system can produce. Increasingly, American high tech companies are hiring better trained workers outside the U.S., countries like India and Ireland. Many of these workers come highly educated, but they lacked opportunities in their own countries. In relatively short order, America went from a country of belching smoke stacks and production rival to the world… to a “service economy.” Little by little, America has come under the economic thumb of the very countries that we sought to exploit only decades ago. “Made in China or India” are on many of the abundantly cheaper products Americans now buy out of necessity, rather than out of quality or loyalty to American workers. If American labor unions and American industry had found ways to work together, who knows what the face of America would look like today. The rivalry between business and unions remains an American tragedy.
Banks and the American Dream.
As America grew in the Industrial Revolution, so did the banking industry. In time, just about any town of any size had one or more banks. They were the center of local trade and commerce. People went to their local banks for business loans, mortgages and personal loans. Americans got to know their bankers as well as their doctors or dentists. Banks were an intricate part of the community.
Big banks and financial institutions came into being to meet the needs of American industrial growth. The captains of industry needed a place, a tool, an instrument to use their growing capital. Financial markets provided for the buying and selling of their stocks and bonds to help fuel America’s growing economy. Over the years big banks have become Mega-banks as Wall Street’s influence and power have grown. Small, community banks were slowly becoming a thing of the past and bank mergers were becoming commonplace. The face of banking was changing with ATM’s and drive-thru windows and credit cards issued by these big banks. Today, online banking over smart phones has come into being. Gone are the days of shopping for a bank by the sort of premium they offered to open an account. It was not uncommon for banks, in those days, to offer a new toaster or some other small appliance to attract customers. Today, we shop by which bank will charge us the fewest fees, service charges and penalties. Which bank will allow you to have the lowest minimum balance in your account? Forget paying interest on that account. Are you kidding? Banking in America went from what they would offer you to have your account with them to what they will now charge you for having and using your money to make the bank even more money.
The American dream has always centered on having a home, a farm, a ranch, something that through hard work and perseverance, you could come to own. The vehicle to this dream of ownership was more often the home mortgage. It was something you worked out with your local banker. He knew you as a person. He knew what you did for a living and what your resources and abilities to pay back the loan were. If you got into trouble, you and your local banker worked things out. The mortgage stayed with your local bank. A few decades ago, a national idea took shape in Washington. It was a good idea. Let’s help returning veterans buy homes. It worked pretty well. Then it moved on to include the thought that middle class Americans and working class Americans could use some help reaching their American dream, too. Federal agencies and corporations were created to help reach this goal. If Americans could find a way to own their own home, they would feel more invested in their communities and neighborhoods. The middle and working class would thrive. It was a truly remarkable vision for the future of America.
The unraveling of this great American dream came with deregulation of big banks, financial institutions and insurance companies by Washington over the last few decades and by both parties in power. Home mortgages could not only be obtained by community banks and big mega banks, but more and more by sub-prime lenders offering seemingly low rates and fewer background checks on the families being loaned the money. The lenders no longer knew their customers. Many people were given loans with such impossible terms that they were doomed to fail. It became not the quality of the loan, but the quantity of loans generated by these often unscrupulous lenders that generated their quick commissions. These good and bad loans could then be bundled up and sold off to Wall Street investors and used as complicated financial instruments to create even more wealth. The American dream was about to become the American nightmare.
The housing market took off like a rocket. Suddenly, real estate was an extremely good investment. With the help of questionable home appraisers, used by these sub-prime lenders, the values of homes began to ratchet up quickly. Speculators came into the market turning homes in a matter days or weeks for a quick profit. Clearly the housing market could not sustain this kind of growth. The bubble burst! Too many bad loans were being held by financial institutions like Lehmen Brothers. In turn, their bad loans were insured by large insurance companies like AIG. One by one, the big banks and Wall Street investors began to realize the mess they had created. Some giants went under. The American economy was about to collapse and markets were in free fall before our government could finally stabilize and bail out these reckless financial institutions..
Housing prices began to fall across America. People who could no longer afford their complex mortgage rates from these sub-prime lenders quickly lost the option to sell their homes. These homeowners soon found themselves “under water,” owing more on their mortgage than the house was now worth on the market. Today, millions of Americans now face foreclosure of their homes or the prospect of simply having to walk away from their mortgage, leaving the banks holding the proverbial “bag.” All around America, whole neighborhoods have been abandoned to weeds, vandalism and neglect by their former owners. With little prospect of resale any time soon, the glutted housing market continues to stay depressed. The American dream lays shattered for so many people. Greed and the inability, or even worse, the unwillingness by Washington to regulate America’s financial industry is, and will be for some time to come, an American tragedy.
The End of Civility, Common Sense and Compromise
Perhaps the greatest American tragedy is being played out before us right now with the debate in Washington over extending the debt limit. If the financial experts are correct and the United States of America is allowed to go into default, America as we know it, may be over and even worse… the world economy could come to a crashing halt. Then again, perhaps it won’t, but a small group of freshmen house Republicans are betting that America and the world won’t crash and burn on August 2nd, 2011. They have steadfastly dug in their heels for their ideology, as have their Democrat counterparts to be sure, and together both sides have brought our country to the brink of an abyss.
Perhaps it does not even matter if they are proved right or wrong. We have seen our national leaders time and time again place party ideology, politics and future election chances ahead of civility, common sense and most importantly…compromise, compromise to get things done for the good of our nation. It is what we have witnessed over these last few weeks, months and years in the halls of our government that is the REAL American tragedy.
Food for THOUGHT…
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