This week marked the demise of Lehman Brothers Holdings and Merrill Lynch (as a separate entity), formerly among the biggest financial institutions in the U.S. A.I.G., the nation’s largest insurer, which insures inter-bank loans, had to be bailed out by the Fed to the tune of $85 billion. Had A.I.G. went under, the resulting bankruptcy domino effect among other banks would have been staggering. It is becoming increasingly clear that we are on the brink of a widespread economic collapse.
Nevertheless, John McCain, who earlier admitted that he doesn’t really understand economics, continues to think that the fundamentals of the economy are strong. Short history lesson: when was the last time our biggest financial institutions started dropping like flies? The Great Depression. Banks are collapsing under the weight of billions of dollars in failed sub-prime mortgages. Near prime (so called “alt-A”) and prime adjustable mortgage foreclosures are still on the horizon. How many more bank failures will we see because of those write-offs? Clearly, the economy is anything but strong.
Why, then, would McCain continue to argue otherwise, considering that banks are failing, people are losing their homes, families have to choose between fuel and food, peoples’ 401(K)’s and college savings plans are drying up, home values are declining, and people are losing their jobs? Well, since McCain agrees with the economic policies of the President who presided over this mess, it’s not hard to see how McCain’s judgment would lead him to that faulty argument.
To be fair, the blame for the instability of our economy cannot be laid solely at Bush’s feet. However, his policies – unwisely cutting taxes for upper-middle class and wealthy Americans and for large companies, depressing the dollar by transferring our wealth to China and OPEC, spending hundreds of billions of dollars fighting ill-advised wars – certainly contributed to that instability. And as Americans’ approval of Bush’s failed policies fell to their lowest levels in 2007, McCain’s agreement with those policies simultaneously went up, to the point where McCain’s 2007 Senate voting record reflects 95% agreement with Bush’s policies. (See also: video link)
McCain’s eleventh-hour call for “change” won’t apply to economic policy. Not only his voting record, but also Palin’s bungled response to the third iteration of Charles Gibson’s question about changes McCain would make to Bush’s economic policy, bear that fact out. McCain wants to expand Bush’s failed, lopsided tax policies, ignore the fallacy of our dependence on oil, and continue spending billions of dollars in Iraq. In other words: more of the same policies that contributed to getting us here in the first place.
McCain, whose wife reportedly wore a $300,000 outfit to the Republican National Convention at a time when people are losing their homes, and whose reliance on oil may be tied to his receipt of millions of dollars in oil company donations after he flip-flopped on off-shore drilling, has to try to convince us that the economy is strong so we’ll overlook how disastrous his policies are. That is deception. Don’t be fooled – the economy is teetering and McCain’s policies will do nothing to save it.