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Economic Meltdown: Don’t Say We Weren’t Forewarned
Posted on Sep 19, 2008
Editor’s Note: This article is a reprint of Robert Scheer’s column, “Bush Overplays the Terror Card,” that originally ran in the Los Angeles Times on June 25, 2002.
Has the war on terrorism become the modern equivalent of the Roman Circus, drawing the people’s attention away from the failures of those who rule them? Corporate America is a shambles because deregulation, the mantra of our president and his party, has proved to be a license to steal. Yet to question our leaders’ stewardship of the economy has been made to seem unpatriotic.
Although combating terrorism is of compelling importance—and should have been before Sept. 11—one is likely to be branded a nut for daring to suggest that the administration might be using current security threats as a smoke screen to obscure our floundering economy.
Yet, after the miserable performance of the stock market these past five weeks, the forced resignations and indictments of corporate titans (not to mention the conviction of a top accounting firm), the humbling of the dollar and a rise in the trade gap, isn’t it time to ask whether the war on terrorism isn’t being milked as a convenient distraction?
The question seems particularly relevant when our man in the White House has had close personal and financial ties to the company—Enron—whose demise is the most glaring symbol of the broad moral disarray of the nation’s corporate culture.
Square, Site wide
Is there any doubt that the chicanery of Enron executives and that of a growing Who’s Who of top CEOs has done more long-term damage to the U.S. economy than the efforts of anti-American terrorists? And while sending in the Marines to clean up the boardrooms is not feasible, we ought to wake up to the reality that business greed is subverting the American way of life—and hurting the image of American capitalism and democracy—more effectively than the ploys of any foreign enemy.
When even Martha Stewart is ethically suspect and her company’s stock has plummeted—though not quite to the depths of Enron, Global Crossing, Tyco, Dynergy, Wal-Mart and Rite Aid—it is time to return to the wisdom of Franklin Delano Roosevelt, the Depression-era president who saved capitalism from itself.
Wealthy from birth, FDR had a healthy awareness of the tendency of the upper classes to destabilize society and even destroy themselves with their greed and hubris. Unlike Karl Marx, however, he believed the unraveling of capitalism was not inevitable if these excesses could somehow be corralled. Thus was born the idea of government regulation as the vital support structure for the powerful, fertile but unstable free market.
Unfortunately, greedy people and institutions don’t like being monitored, and they have the means to corrupt governments and skirt laws.
Since the so-called Reagan Revolution, powerful corporate interests have succeeded in profoundly damaging the foundation of a properly regulated economy. Company auditors, for example, have become accomplices to deceptions of the public that should be considered criminal but that often do not violate statutes written by corporate lobbyists.
Enron provides a startling illustration of a company jumping through loopholes that its D.C. lobbyists have created. In fact, the Enron scams made possible by deregulation in the first Bush administration are still being revealed, such as last week’s reports that the company hid billions in income during the California energy crisis while publicly denying it was profiting excessively.
Yet former Enron officials continue to play an important role under Bush the younger. The Bush family, in fact, has never been seriously confronted by the media or Congress as to its questionable ties to former Enron Chief Executive Kenneth Lay, a close family friend and top contributor to Bush family presidential campaigns.
To be fair, the corporate corruption of our political system has long been bipartisan. The Clinton White House, for example, sponsored major deregulation acts, including the Financial Services Modernization Act, which reversed consumer protections enacted under Roosevelt, and the Telecommunications Act of 1996, which effectively ended all public accountability for the communications industry and has permitted a few media giants to gobble up vast markets.
Clearly, the problem is bipartisan when a Democrat-controlled Senate moves so hesitantly to confront the myriad examples of sickness in our economy and corporate culture.
The politicians hesitate to act because candidates of both parties are lavishly financed by the very people who are conning a gullible public.
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