I’m constantly amazed at Wall Street, which acts like an extremely skittish horse — panicking when it encounters the slightest scare – in response to every bit of bad news.
Television journalists and skeptics of the nation’s new economic recovery plan aren’t much better. They’re hammering away at the economic recovery plan, sowing seeds of doubt, which, lest we forget, was just passed a few days ago.
We all need to breathe deeply and remember that it took a long time for this economic crisis to unfold. It is going to take a long time to dig out of the hole we’ve dug for ourselves.
To be successful, however, we need to address the root causes, which are many and varied. It’s not something Americans are particularly good at. We like simple cause and effect. What are the causes of the economic crisis?
Although the sub-prime mortgage meltdown was the precipitating factor of the current economic downturn, there were many other economic factors that have, over the past decade, caused the financial erosion of the United States’ economy whose downfall has resulted in a global domino effect. The subprime meltdown just toppled an already severely weakened economy.
Violent weather, for example, has been hammering America for a long time, costing us untold billions that have sapped our financial strength. The price tag of hurricane Katrina alone could easily top $150 billion.
Violent tornadoes and floods have wiped out many communities, like Greensburg, KS. The southeastern United States has also been plagued by costly drought and wildfires.
Floods, hurricanes, tornados, and wildfires are all the likely result of global climate change, resulting from the massive release of greenhouse gases for many years, as well as the relentless deforestation of the planet.
They have cost us billions upon billions in insurance claims, lost property, lost lives, and rescue efforts, all of which have eroded our nation’s economic strength.
Unfortunately, many of America’s leaders, among them the former president, have steadfastly stood in the way of global efforts to combat climate change. Such efforts could have helped us financially, freeing up capital for new business ventures rather than rescue efforts.
And then there was 911, which sent our economy into a downward spiral. It was followed by a costly invasion and war in Iraq. The billions we spend every month have also helped to erode our nation’s financial underpinnings.
Although not all readers may agree, tax cuts, which primarily benefited the super wealthy, have also eroded the nation’s financial strength as well. Over the past 8 years we’ve watched our government go into deeper and deeper debt as it unbalanced a previously balanced budget. The previous administration and Congressional allies have systemically reduced revenues while increasing expenditures.
Lest we forget, you can’t mount a $10-billion-a-month war without revenue. It’s economic foolishness, and it erodes our nation’s financial strength.
And then, of course, we must not forget the high cost of oil and gasoline, which sent ripples through our economy. It too has been a part of the financial erosion that has contributed to America’s current economic crisis.
Once again, America’s “leaders” and America’s automakers have steadfastly refused to even discuss improvements in fuel mileage that could have helped to prevent that problem by driving down demand and fuel prices.
The economic loss caused by violent weather and wildfires caused by global climate change; our refusal to address this issue; 911 and the war in Iraq; imprudent tax cuts; the huge budget deficit; the wildly unbalanced budget; high oil prices and our refusal to adopt more fuel-efficient vehicles all lie at the roots of the financial crisis. The subprime mortgage crisis, merely just pushed this battered and weakened economy off its already eroded legs.
It will take time to reverse the effects of these policies. Be patient.