Change is in the Air by Matias Bulnes, NYC

The situation of the US seems to be as precarious as it has ever been: An unprecedented debt, a looming economic crisis of unbeknown consequences, an unmanageable war, the threat of terrorism lurking, China’s power increasing persistently and, let’s not forget, all this in the midst of a fierce struggle over interpretations of fundamental constitutional principles sparked by the Guantanamo Base prison and the wiretapping of citizens. And when one hits rock-bottom consolation comes from the realization that things can hardly go worse. But this is not to say that things are going to get better. For the US economy can go a long time before it recovers—as it happened after the Great Depression. And in fact, it may never totally recover, as some fear that China might relegate the US to a secondary role sooner rather than latter. The challenge of the day is to get out of the hole as fast as possible and, perhaps more importantly in the long-run, to get out of the course of events that led the country down this hole. The country needs change—and desperately so.

There can hardly be any doubt that the main responsible for the present state of affairs is the Republican Party in general, and the Bush administration in particular. Clinton handed the country to Bush with surplus after a decade of economic prosperity, no major military conflict, in fairly good terms with its European allies, and with the Israel-Palestine conflict having come as close to a solution as it has ever been. The Republican administration will likely return the country in the aforementioned deplorable conditions—may they not have another period to devastate it more.

Not even external, unforeseeable circumstances such as the terrorist attacks of 9/11 can account for the magnitude of the disaster. There are plenty of fingers one can point to decisions that straightforwardly explain much of the problems. Economists from within and without the country had been warning for years of the risks involved in such a ruthless deregulation of the US financial market. Or as many have observed, it is just naïve to believe that a housing market that always goes up might not turn out to be a bubble. Or in foreign policy, even now nobody understands why go into Iraq in order to hunt down someone who is hiding in Afghanistan and, moreover, in a way that undermines international institutions and threatens one’s allies. The list goes on and on.

All of this is familiar territory. But more significant than the usual declamations about Bush’s mistakes is the ideology that has driven him through such unfortunate decisions. For as one would have expected, all the mistakes hang together nicely in a way that reveals American conservativism in the background. The deregulation of the markets is the battle flag of the conservative right, while preemptive war has been advocated by the religious right and the neoconservatives. These two policies account for a good deal of the present distress, both of them courtesy of American conservativism.

The association between the present crisis and the conservative views that have dominated US politics over the last decades is clear in theory. The question is whether it’ll be as clear to the voter’s mind. And I think we can be optimistic about change in the political direction of the country to the same extent that we should be pessimistic about the current situation and the near future. For the American electorate has proved to be more sensitive to shock therapy than to ideological reasons, and crises, when severe, are felt by everyone around both sharply and helplessly. If the crisis is as bad as experts predict, voters will look around for people to put the blame on and eventually find conservatives and the Free-market gurus.

In fact, this path has been traveled before. The Great Depression, lately used to inspire fear of the present crisis, also marked a point of inflection in US politics. After decades of Republican domination the Great Depression ushered in more than 30 years of Democratic control of the White House only interrupted by Eisenhower. In fact, that was the last time Democrats won back to back elections. And then you have Marx all over again: if you want people to change prick them on their pocket.

Democrats brought Keynesian ideas to the table putting thus an end to that old-school Capitalism advocated by Republicans which had led the country to the economic crisis. A smoother form of Capitalism ruled the US for a few decades while Conservatives regrouped around Milton Friedman’s ideas. With the Cold War a new era of Conservative dominance kicked off. Arguably an era that goes on until today.

Neoliberals would probably want to view the historical progression in a different light. They would rather say that the American electorate always falls back to their ideology because in the long-run it pays off. That is, even with the crises the sparkling dynamism created by deregulated markets is the key to the US economic success and its political supremacy in the modern world. But this view does not seem historically accurate as the US has experienced enormous prosperity in times of Democratic presidencies. And more importantly, it is not clear that the electorate should place such a tremendous importance on growth at the expense of economic stability. In the light of the current distress, it may well turn out to be more rational to settle for a moderate though sustained growth while avoiding such traumatic episodes as economic crises.

The analogy with the Great Depression is no more than an imperfect comparison. But it is one that exemplifies the underlying forces that produce significant change in the political landscape. While crises are always regrettable due to their devastating human consequences, they also urge revision of political institution and policies. In short, crises oftentimes ensue reorganization and change. It is my hope that the American electorate will react to this wake-up call and will finally opt for a more friendly form of Capitalism.