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by Mel Griffith
It appears that our credit based economy is in the process of collapsing. We are already in a recession and may be headed for a depression. A few generations ago few people charged anything, at least not past the end of the month. Now many people carry huge balances at high interest rates on their credit cards, much of it for things they didn't really need in the first place. Nobody worried about it because everybody expected that things would always be better the next year and they would catch up eventually. But when things get worse instead of better, they are in big trouble.
Many people bought houses bigger than they really needed, often with little or no down payment, because they thought that the bigger the house, the more it would appreciate in value. That way they could enjoy having more than they needed and make more money besides. But when the housing market dropped at the same time that the cost of living skyrocketed, they couldn't make the payments or sell the house and the newspapers are full of foreclosure notices.
As if we couldn't manage badly enough on our own, we are constantly bombarded with advertisements encouraging us to manage poorly. We are regularly told that there is money in our house which we need to get out and spend by taking out a second mortgage. Of course the truth is the exact opposite. We need to be putting extra money into our houses so that the mortgage gets paid off sooner, or putting money into other investments if we don't have a mortgage. We are told that as we get older we need a "reverse mortgage" so we can waste our children's inheritance and leave them with nothing.
The oil crisis is dragging down our whole economy because everything depends on transportation and electricity and these things are big users of fuel. On top of all the problems caused by high fuel costs, we have a food crisis caused by ill-advised efforts to use food for making fuel.
The most scary thing of all about our future is that Sen. Obama, who clearly has no idea what to do, and whose suggestions have all been counter-productive to making progress, might actually become president and make things much worse.
His stock answer to all constructive suggestions is that they wouldn't help right now. Of course not. Complex projects take time. Hasn't he ever heard of long-range planning? Doesn't he understand that we have a crisis now because the government bungled energy development for years in an effort to appease environmental fanatics?
Our economy isn't going to get better fast no matter who is elected. But it can get much worse in a hurry if the wrong people are elected.
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