Enough of the silly slogan that “government isn’t the solution, government is the problem.” Government, in fact, is the solution to a national economic calamity not seen since the 1930s.
Today’s painful conditions would have been more disastrous had Washington not stepped in with massive business bailouts. The remedy prescribed by ultraconservative Republicans—more tax cuts—would have healed nothing. In fact, tax cuts favoring the wealthy enacted during the George W. Bush years plus the voracious borrowing to pay for Iraq and Afghanistan wars accelerated today’s misery.
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Since rolling out his anti-Great Depression policies in 2002, Ben Bernanke has had the dubious distinction of being the major contributor to the worst financial and economic crisis to hit in the post-World War II era. His theory and practice was to fight an enemy that did not exist in 2002 – deflation. As a result, he ended a long period of economic prosperity.
The changes in the economy over the past 18 months have had profound effects on the lives of people across the country. Now, for the first time, a new PARADE survey shows just how dramatically Americans’ goals, hopes, spending habits, relationships, and even their attitudes toward trusted institutions have been transformed by the recession.
Why didn’t Wall Street firms tell potential investors that the bonds they were selling them were rotten? Why did their business partners, including subprime mortgage lenders, ignore glaring evidence that borrowers weren’t qualified and give loans to virtually anyone with a heartbeat?