The economy is on fire

By MICHAEL HALEY

The economy is on fire and Congress, the Media, and the voters are all fiddling while it burns. We need this bail out, and we need it fast, and it is bailing out not just the big money interests, it is bailing out you and me, it is bailing out everyone. Not enough people seem to get that urgency, and we need to, fast.

What a credit market freeze means is that runs on banks will ensue. In fact, they have already started to some extent. Sunday night on 60 minutes Henry Paulson said that what motivated him to propose this dramatic rescue is that on his computer monitor he saw runs on commercial banks begin one day the week before last. Big runs, $40 billion plus runs. He called Bernanke and they both agreed drastic action was needed immediately.

Runs on the banks are the literal action that happened that brought on the great depression. If people lose confidence that their money is safe in the bank, they try to get it out. Already people are shifting money around to make sure they are covered by insurance on deposits, gold sales are soaring, and some small businesses are refusing to take checks and insisting on cashiers checks, according to a panel of small business experts interviewed on Fox business yesterday. Many of the early warning signs are falling into place.

We do not have time to fiddle and diddle. The national conversation sounds like some kind of pathetic encounter group, "well I am angry about this, well I am angry about that, well you did this to me, well you did that to me," yada yada yada. Grow up people. We need action. You don’t have time for all this blaming and ideological one-upmanship.

The history of economic crashes shows that the majority consensus consistently denied the problem right up until total disaster. Do not be lulled by the fact that the market ran up today. It could just as easily run down tomorrow, or up again another day then totally crash for a week, then the rest of the year. No one really knows, that is the problem, but we do know that we are on the verge of a cliff and the entire dithering going on is foolishness.

At any moment a run could start due to lack of confidence, and if that gets any sort of momentum it could be difficult to stop. It is like a stack of dominoes, once they start to fall they all go, and with any kind of momentum there will be no stopping and we could be in deep trouble for years.

What we are bailing out is not just the big investment community; we are bailing out your paycheck, your pension, your job and your bank account. Just because there is a lot of blame to go around, let’s not shoot ourselves in the foot to make a point.

The voters are having a hissy fit, not unlike the Republicans who voted against this because Nancy Pelosi chose that moment to give one of the most ungracious, unleaderlike speeches I have heard in a long time. But voting against it for that reason is just being a bratty blamey kid.

And don’t tell me they didn’t do it, I was watching live television and saw John Boehner come out and say exactly that as soon as the vote was over.

One thing this is about is the whole issue of blame. Blame is a waste of time. Once we solve the problem we can go back and redo policies as needed. The bail out we had was good enough, and we can adjust any problems as we go.

But the economy is on fire, and before it burns to the ground and it is too late to save it, we need Congress to pass a bail out plan. We need to save confidence in the system before it is too late.

If you need to see what is going to happen if we don‚t get the problem fixed, go here:

Write to Mike Thompson and tell him you want a fix passed, now, click here.

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