Author: David S. White

You’ve all seen the ‘Perp Walk,’ where they parade the alleged perpetrator of some alleged crime before the TV cameras amid throngs of pushing and pushy reporters armed with microphones and shouted questions. It has become an American media staple. I recorded TV coverage of the ‘Perp Walk’ by the corporate Masters of the Universe before a Congressional Committee Wednesday and it was really something to behold.

With each talking head, MSNBC put up the amount of BailOut Billions that each one’s corporation received. Vikram Pandit, CEO of Citigroup: “We did not adjust quickly enough to this new world,” explaining Citi’s purchase of a “foreign-made corporate jet” for a mere $50 Million of your and my tax dollars. With appropriate-looking contrition on his face, Pandit continued: “and I take personal responsibility for that mistake. In the end I cancelled delivery . . . I get the new reality and I will make sure Citi gets it as well,” having ridden into Washington from his New York office via Amtrak, learning well from the mistakes of the heads of US AutoMakers who had come hat in hand to Congress last Fall on corporate jets, only to be rebuffed and nailed for their arrogance, then to return via more appropriately humble transportation.

Call me cranky, but, there is nothing wrong with American or Californian government that having three or four political parties, instead of just the same old two, wouldn’t fix. I have followed for too many hours the incessant wrangling in California’s legislature over the ever-elusive, balanced budget and the more recent Katzenjammer Kids-style slapstick battles over whether Obama’s bill is really ‘stimulus,’ whatever that actually means, or just plain old pork, the other white meat. We could stop this inefficient, and no longer amusing, bickering in the face of a tidal wave of trouble if we just had a third, and even a fourth, viable political party to balance off the Tweedle Dee and Tweedle Dum nonsense we constantly slide back into, regardless of whether we vote for change or more of the same. It’s the too long missing element in American politics.

So now we have another $827 Billion, or so, in new BailOut funds (which they don’t call “BailOut” anymore – that is so, so 2008) spread out among tax cuts, “shovel ready” infrastructure projects, a little pork here and there, and a bunch of other life preservers and economic emergency plans to get America back to work. But, will it work?

President Obama told us we are averting a “national catastrophe,” some economists tell us that we are still underestimating how bad this situation really is, and the job loss numbers now put us at 7.6% unemployment nationally, with no figures for those who have fallen off the far end of the statistical train, or are underemployed, or who had to go back to work because they lost all their retirement money. If we are sliding into the next great Depression and real, live Deflation is happening all around us (50/75% off sales abound), are we now officially living in our own Lost Decade, like Japan was in the 90’s?

According to the TV program: “Million 2 One,” showing now on the Science Channel®, if you tried to count to One Trillion counting each of your ten fingers, over and over, counting 24 hours per day, non-stop, it would take you 31,688 years of such non-stop finger-counting to count to one Trillion. Time Magazine (Jan . 26, 2009, ‘Inauguration Preview Edition’) contributes further to our knowledge base of this new frontier, right in time for the Super Bowl: One Trillion dollars would “cover every NFL player’s salary, on all 32 teams, for the next 313 years,” or, for those who have had quite enough football by now, thank you, “you could treat every person in the world [6 ¾ Billion, give or take a few stragglers] to [Starbucks’ finest] one Frappuccino per day for 37 straight days.”

“Let’s be realistic, $700 billion is not enough,” recently said one of the deans of the Wall Street Bar, H. Rodgin Cohen, Esq., chairman of Sullivan & Cromwell at a conference hosted by The Deal magazine a couple of weeks ago, talking about what it is going to take to get the ship of state righted and sailing ahead again; “I think it’s the ‘T-word,’ ” he said – One Trillion Dollars.

[READER CAUTION: CONTROVERSIAL SUBJECT ALERT]

If we can’t learn to think outside the box, then we will not solve California’s massive financial problems which right now are the worst present we can leave for our children, grandchildren and their children and grandchildren. What if I told you that there was a $13.8 Billion annual crop growing right here in California, year after year, nearly double the value of California’s vegetable and grape crops combined, which is not hard to grow and thrives in California’s many climates and terrains, but which, amazingly, is not taxed at all?

What if I told you that California is the top producer of this valuable crop of all the 50 states. What if I told you that, using conservative numbers derived from analyses done by our Federal Government, the entire domestic production of this crop in the whole U.S. has an annual value of $35.8 Billion, making it the #1 largest and most lucrative cash crop grown in all of America!

Mental health professionals say there are a handful of things that can happen that can really knock you off your perch and leave you lying, severely wounded, by the side of life’s road – at least for a while. Losing your job is right up there with the Three Big D’s: Death, Divorce, Depression (both economic and of the individual mind). No less than Sigmund Freud put working at a job right up there with sex, family, loved ones and life’s other undeniable virtues – things that still provide a solid bedrock for us as we race madly about, living and consuming (well, we used to consume before last Fall’s economic debacle kicked into high gear) here in our 21st Century Age of Information.

Monday’s NYT had this disturbing headline: “Big Companies Around Globe Lay Off Tens of Thousands,” (Jack Healy, Jan 26, 2009), recounting in agonizing detail the numbers of all those people who will come home to their loved ones, families, cats, dogs, goldfish and whatever, with the really bad news that they no longer have a job. Most mature adults, without a fortune salted away to take them out of the Rat Race, define themselves by their jobs, mentioning what they do for a living right up front with our names and the obligatory ‘who do you know,’ when we first meet others in social settings.

There is a popular misconception about how the Great Depression (we may have to rename that soon) actually occurred, starting in 1929. Most think it all happened in one sad day that Fall when the market crashed and then there were bread lines, soup kitchens, and all those pathetic black and white photos. Actually, it was much longer and more protracted as the many economic and business gurus of the day argued and dickered and dithered over what to do and how to do it – kind of like we are doing right now on both the US national level and the California state level.

World War I used to be called the Great War; then we had World War II. The Great Depression that Boomers of my age grew up hearing about endlessly from our parents and grandparents may be seen as Depression I shortly and what we are living through right now may shortly be known as Depression II. You may have noticed, as Depression II unfolds further, that we are not exactly in agreement about what to do about it. People like Robert Reich and Paul Krugman are screaming from the rooftops that this is a whole lot worse than anybody imagined and that Obama’s current $800 plus Billion Stimulus Package, now delayed until mid-February as Congressional Wordsmiths have at it, as huge as it may be, is actually just too mild and modest for the conflagration that we face.

Some may have noticed last week that Bank of America, having eaten heartily at the table and gobbled up a few other failed companies like Countrywide and Merrill Lynch, has now lined up for Federal TARP BailOut money – your tax dollars at work.

Tom Friedman’s Sunday NYT column talks about Pres. Obama convening a meeting of the 300 top US Bankers and having a “Come to Jesus” lecture – Friedman’s thinking, though bold, was not bold enough and was exclusionary of billions of humans on this planet – I would expand that to a “Come to Jesus/Moses/Buddha/and Everybody Else, Be They Atheist, Pagan, Agnostic, Wiccan, included, for Our Last Chance to Get This Banking Thing Right.”

As we peer over the cliff in this still young year to glimpse what is promised to be an even nastier 2009 than 2008 was, it is apparent that the recipients of the first $350Billion in BailOut funds, whatever they used them for, did not use them to loosen up the still frozen-solid Wonderful World of Credit, a bedrock of our magnificently successful national experiment in Capitalism, with a capital “C.”

As we await California’s impending financial collapse, you might think that booms and busts are new here. They’re not. In fact, California (and U.S.) history is chock full of booms and busts, going all the way back to the early days of our statehood. Since 1854, the whole of the U.S. has encountered no fewer than 32 cycles of expansions and contractions, averaging some 17 months of contraction and 38 months of expansion, as tracked by the NBER (National Bureau of Economic Research). From 1945-2007, the NBER has identified 11 separate recessions; averaging 10 months in duration (peak to trough).

The Gold Rush, starting in 1849, saw many ships simply abandoned in Yerba Buena harbor – what would soon be San Francisco – as everybody on board lit out for the gold fields, leaving nobody to sail the ships back to from whence they came. Some of the ships were filled in right in place, becoming buildings or foundations of buildings – every now and then, we hear of construction sites uncovering parts of long forgotten, old buried ships – San Francisco has a lot of filled land that was water back in the 1850’s. The Gold Rush itself went from boom to bust very quickly, leaving ravaged, barren countryside at the diggings and, it is often repeated, that significantly more people made serious money selling equipment to the gold digging Forty-Niners than by actually digging gold.