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VIDEOEconomic Recovery Begins With Forgiveness
People will need to be forgiven for taking on debt they can never pay off, just as we should forgive elites who put us in this mess.
The Occupy Wall Street movement is just the latest sign that Americans aren't ready to let go of the trauma of 2008-09. I'm partway through Ron Suskind's recently released Confidence Men, which recalls the events and decisions made during 2008 and 2009, and at times reads like a laundry list of policy mistakes made at the start of President Obama's administration. In addition, Ezra Klein put out a great piece over the weekend detailing all the reasons why the economy and fiscal policy evolved the way they did since the start of 2009, and why we remain stuck in this economic and political quagmire. What's the underlying emotion behind our deepening political paralysis as a result?
I was having a debate with a friend of mine on Twitter about Occupy Wall Street after he linked to this picture, which has been making the rounds by those hostile to the movement:
Click to enlarge
His ultimate point, which has been made by many, including Rick Santelli in his infamous rant, is this:
"I don't see why an individual who worked hard and saved prudently should pay more taxes to fund debt forgiveness."
It's a fair point, and one that I would have made and agreed with as recently as six months ago. I was as die-hard libertarian as they come.
My very first investment decision after graduating from college in 2003 was buying a precious metals mutual fund. In 2007, at age 26, I gave the max donation, $2,300, to Ron Paul's presidential campaign. I handed out flyers and knocked on doors for him in that great conservative hotbed called San Francisco. In March and May of 2010, I spent a week and a half volunteering in Kentucky for Rand Paul, knocking on doors and making phone calls. I attended his private reception the night he won the primary in Bowling Green, Kentucky.
Because of my activities and donations, I was a guest of Ron and Rand Paul's at Rand's oath of office reception at the US Capitol this January. I attended CPAC in February.
This was no part-time dalliance for me.
And yet after looking at the data and how the economy has unfolded this year, and seeing the riots and protests in the Middle East and Europe, I came to the realization that my beliefs were wrong and had to change. Austerity has been a failure. Since President Obama assumed office in January 2009 the private sector has lost over 1.5 million jobs. The public sector has cut 600,000 jobs. It doesn't take a genius to figure out that cutting (government) jobs doesn't increase employment.
It's dubious as to whether austerity-lite is leading us any closer to a recovery, but one thing we know for certain is that this continued funk is radicalizing our politics even more and making us more and more pessimistic about the future.
But back to the point raised by my friend and Rick Santelli. How can we justify the prudent bailing out the profligate? Can such a justification even be made?
Maybe, maybe not. But what we can do is implore people to do something even harder than make that justification, but which is ultimately so much more powerful.
Forgive.
We are all still holding grudges for the failures of 2008 and 2009. Tea partiers hold grudges against the banks and their bailouts, perceived government overreach, and those who depend on the government. Occupy Wall Street protesters hold grudges against the banks, large corporations, and the wealthy. These grudges are all for good reasons depending upon the way you view the world, and I won't deny anyone any of these. But unfortunately, grudges are unproductive, and hurt the holder of them more than their target.
Forgiveness isn't about saying, "no harm, no foul," but rather recognizing the damage that was done and being strong enough to grant an act of mercy to those who did the damage. Wikipedia defines forgiveness as "the process of concluding resentment, indignation or anger as a result of a perceived offense, difference or mistake, or ceasing to demand punishment or restitution."
That sounds like exactly what we need right now. So let me go on the record and get mine out there.
- I forgive Alan Greenspan for holding interest rates too low for too long.
- I forgive former President Bush for the $4 trillion of debt he gave us as a result of his administration's tax cuts, wars, and expansion of Medicare.
- I forgive Ben Bernanke for underestimating the extent of the financial crisis.
- I forgive former President Bush, Treasury Secretary Paulson, and Ben Bernanke for the poorly-structured bailouts.
- I forgive President Obama for underestimating the extent of economic damage in early 2009 and an ill-advised focus on healthcare reform instead of job creation.
- I forgive Wall Street for its part in creating our overleveraged and opaque financial system.
- I forgive those homeowners who bought a bigger house than they could afford and who perhaps even lied to attain financing.
- I forgive those who racked up too much student loan debt chasing unproductive degrees and who now seek debt relief.
- I forgive myself for holding onto these grudges for far too long.
Only once we forgive can we recover. Until then we are only hurting ourselves.
(See also: Why 'Occupy Wall Street' Is a Radical New Business Model)
Twitter: @conorsen
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