George Soros is, uh, not cheery about the economy (but who is?):
Every time the credit expansion ran into trouble the financial authorities intervened, injecting liquidity and finding other ways to stimulate the economy.... Fundamentalists believe that markets tend towards equilibrium and the common interest is best served by allowing participants to pursue their self-interest. It is an obvious misconception, because it was the intervention of the authorities that prevented financial markets from breaking down, not the markets themselves....Ah, what about those regulations you ask? William Greider notes at the Nation that there was one law in particular that prevented much of the criminality we've seen since 2000 that was eliminated by pro-business lobbying:
Globalisation allowed the US to suck up the savings of the rest of the world and consume more than it produced. The US current account deficit reached 6.2 per cent of gross national product in 2006. The financial markets encouraged consumers to borrow by introducing ever more sophisticated instruments and more generous terms. The authorities aided and abetted the process by intervening whenever the global financial system was at risk. Since 1980, regulations have been progressively relaxed until they have practically disappeared.
Just as the GOP dreamed for decades of dismantling Social Security, investment bankers campaigned for thirty years to repeal the Glass-Steagall Act, which separated commercial banking from its investment-house cousins. This was the New Deal achievement enacted in response to the double-dealing banking practices that contributed to the crash of 1929. Bankers pushed their depositors into buying the corporate stocks the bankers were hustling, among other malpractices. Wall Street hated the law but failed year after year to win repeal.The men most responsible for the elimination of Glass-Steagall? Robert Rubin and Bill Clinton. And before you say, "GOP Congress! Republican lobbyists! Not our fault!", when something changes we look at the circumstances that changed, not the ones that stay the same. The GOP always wanted to repeal Glass-Steagall, but they never had the combination of a pliant President and control of Congress. Bill Clinton -- a Democrat, allegedly -- gave them that.
So why am I optimistic? Because despite 8 years of Bush, we're starting to see Democratic bloggers wake up from the unseemly adulation of Bill Clinton, due in no small part to the discovery that, when asked to choose between what's good for the party and what's good for him, Bill is still choosing himself.
I believed in 2000, and believe now, that voting for Nader was idiotic. But I certainly understood the impulse. Oh, did I understand. Hopefully, the Democratic Party can actually learn the lessons of the last, failed, Democratic presidency, and move forward.