Think positive, this ’slow motion train wreck’ is good for the U.S.

Yes, America needs a recession. Bernanke and Paulson won’t admit it. And investors hate them. We’re all trapped in outdated 1990s wishful thinking about a “new economy” and “perpetual growth.” [snip]

Let’s focus on 17 benefits from this recession. [snip]

1. Purge the excesses of the housing boom
No, it’s not heartless. Not like wartime calculations of “acceptable collateral damage.” Yes, The Economist admits “the economic and social costs of recession are painful: unemployment, lower wages and profits, and bankruptcy.” [snip]

2. U.S. dollar wake-up call
Reverse the dollar’s free fall and revive our global credibility. [snip]

3. Write-offs
Expose Wall Street’s shadow-banking system. [snip]
A lack of transparency is killing our international credibility. Write it all off, now!

4. Budgeting
Force fiscal restraint back into government. [snip]

5. Overconfidence
A recession will wake up short-term investors playing the market. [snip]

6. Ratings
Rating agencies have massive conflicts of interest; they aren’t doing their job. They’re supposed to represent the investors, but favor Corporate America, which pays for the reports. Shake them up.

7. China
Trigger an internal recession in China. [snip]

8. Oil
Force the energy and auto industries to get serious about emission standards and reducing oil dependency.

9. Inflation
Expose the “core inflation” farce Washington uses to sugarcoat reality.

10. Moral hazard
Slow the Fed from cutting interest rates to bail out speculators.

11. War costs
Force Washington to get honest about how it’s going to pay for our wars, other than supplemental bills that are worse than Enron-style debt financing.

12. CEO pay
Further expose CEO compensation that’s now about five hundred times the salaries of workers, compared with about 40 times a generation ago.

13. Privatization
Stop the privatization of our federal government to no-bid contractors and high-priced mercenary armies fighting our wars.

14. Entitlements
Force Congress to get serious about the coming Social Security/Medicare disaster. [snip]

15. Consumers
Yes, we’re all living way beyond our means, piling up excessive credit-card debt, encouraged by government leaders who tell us “deficits don’t matter.” Recessions will pressure individuals to reduce spending and increase savings.

16. Regulation
Lobbyists have replaced regulation. Extreme theories of unrestrained free trade plus zero regulation just don’t work; [snip]
Get real, folks.

17. Sacrifice
“We have not seen a nationwide decline in housing like this since the Great Depression, says Wells Fargo CEO John Stumpf. As individuals and as a nation Americans have always performed best in crises, like the Depression or WWII, times when we’re all asked to make sacrifices. Pampering us with interest-rate cuts and tax cuts… setting the stage for this new subprime/credit crisis.
Wake up, the train wrecked. Time to think positive, find solutions, demand sacrifices.

The only difference between the hard times of yesteryear is the surfeit of liberal thought eg. “Let the government save me while I idle away my time.” Perhaps an economic wedgie of hard conditions might change their aversion to self-sufficiency. Then again, they may just starve.

Archived in: China, Congress, Deficit, Economy, Energy Policy, Housing, Liberalism, Medicare, Social Security