Thursday, February 26, 2009
By FRIDA GHITIS
Years from now we will look back at what the government did in response to today’s economic crisis and will marvel at the results. We will either stand in awe of how boldly and brilliantly our leaders behaved, or slap our foreheads in disbelief at how we stupidly allowed their recklessness. Pouring trillions — trillions — of taxpayers’ dollars at a sinking economy is one scary decision. It might save us, or it might sink us. And it can bring the rest of the world down (or up) with us.
The new head of national intelligence, Dennis Blair, told Congress that the economic crisis has become the greatest danger facing America. “Regime-threatening” instability, he said, could unleash more global violence and extremism. Economic collapse in Afghanistan helped bring the Taliban and 9/11. Now many more countries and regimes face economic turmoil, among them nuclear-armed Pakistan. Our downward spiral could strangle the world. That we know. The question is what we do about it.
Anyone who claims to know with absolute certainty that the economic stimulus and bank rescue packages will work is suffering from delusions, is a fool or is lying.
Republicans dismissing the plan as a waste and Democrats touting its cleverness with equal conviction are posturing. Nobody knows. A spending jolt from the government looks like the reasonable prescription, but the side effects could prove devastating, with debilitating deficits and crippling inflation far into the future.
Economists tell us the 1930s turned to tragedy because the government failed to act. But each disaster has its own traits. Economists are best at explaining why things didn’t turn out the way we expected. What makes the moment more perilous is that almost every country on Earth is following the same treatment. If it works, we will share in a global sigh of relief so powerful it might create its own weather system. If it doesn’t, we’re in for some very dangerous times. Economic turmoil spawns more than hunger and homelessness. It unleashes epidemics of blame, which can bring ethnic conflicts, wars and more chaos.
The reality is so chilling that it’s no surprise on television we can’t seem to escape Captain Sully, the Hudson River hero. The man who prevented a deadly plane crash helps us believe superheroes and miracles are possible; even today.
I thought of “Sully” the day Treasury Secretary Tim Geithner unveiled his not-ready-for-prime-time bank rescue package, when the market plummeted 400 points. Unlike the cool-as-a cucumber captain, Geithner looked utterly terrified. He’s not sure he can bring us in for a smooth splash landing. No wonder the markets panicked.
Twin rescue bills
When I hear of the twin rescue bills, I keep thinking back on a visit to Egypt years ago. Buying a ticket to a state-run museum required five government employees to write my name on a ledger, take my money, stamp the ticket and so on. The process was not only irritating for me; the workers looked embarrassed, robbed of their dignity.
In the middle of a crisis we want larger-than-life leaders. Instead, we get politicians, bureaucrats and economists. President Barack Obama is balancing on his wobbling pedestal, reassuring us we are in good hands. But Vice President Joe Biden, off script, told the truth. “If we do everything right,” he said, “if we do it with absolute certainty, there’s still a 30 percent chance we’re going to get it wrong.” It’s unclear how he computed the odds, but it’s clear this is not a sure bet.
What we need is a superhuman effort. And we need it from all who work for the government and all who will manage the billions in taxpayer funds that will flow in the coming months: We need to make sure the money is not wasted.
Can politicians and bureaucrats look at the mountains of money without seeing a pile full of goodies for donors and friends? Perhaps it’s foolish to believe that in a crisis, with so much at stake, our leaders can rise to the occasion. Maybe it’s too much to think that members of Congress, contractors and businesses, regulators and accountants will all do their best to give this plan a shot at success.
A decade from now, economists and historians will study what happened in 2009. By then, we will know if the year marked the end of this crisis or the beginning of a massive global unraveling.
X Frida Ghitis writes about global affairs for The Miami Herald. Distributed by McClatchy-Tribune Information Services.