Politics tends to be reactive. Issues often aren’t issues until they make news. Media outlets and political candidates tend to speak out after disasters occur not before, even when that old handwriting is on the wall.
So it is with the financial crisis that seems to be toppling bank after bank, affecting company after company and threatening the global economy.
Many of us have been in denial about it perhaps because until now we were not directly affected or it seemed abstract. It has also been a slow-motion crisis building steam since the markets first melted down in August 2007.
What’s happened since has been unprecedented: a freeze-up of all credit, massive multibillion-dollar write-downs by brand name banks. Three-and-a-half million families faced foreclosure, and then one after another major financial dominos started toppling, triggering seven interest rate cuts and requiring infusions of capital in the hundreds of billions. Then Bear Stearns fell, followed now by the troubles at Lehman, Fannie Mae, Freddie Mac, AIG, etc.…
It doesn’t seem to be stopping, as a thousand banks are expected to fall. Words like “bailout” and “plunge protection” are becoming more common.
Oddly, all the economic pain and uncertainty leading up to what may still become a catastrophe had mostly been buried in the business section. They had been overlooked by both parties in their platforms and by both leading presidential candidates on the campaign trail.
Events are now forcing them to respond to the disaster, but the issues and choices we face are still not being discussed clearly.
Bloomberg News reported during the conventions that even as we confront the most serious economic crisis since the depression the reasons our economy is not working are not discussed.
Part of the problem is that media itself is not putting the issue on the agenda, asking candidates about it only in a breaking-news context. Rather than expose predatory subprime loans when Wall Street was riding high, many media outlets were carrying deceptive ads for lenders and credit card companies.
And even now as disaster threatens, the coverage is tepid, superficial and misleading, as the Marketwatch website argued:
“There was an absence of tough, in-your-face questions… But where was the skepticism or the sense of outrage by the media? We’re supposed to be the proxies for the public. When I saw television networks interview the (wo)man on the street during the crisis, I saw more emotion in the faces of ordinary citizens than in those of the journalists.”
The same thing must be said about presidential candidates John McCain and Barack Obama. It won’t do for McCain to rail against fraud and corruption on Wall Street without someone pointing out that the Republicans have been in charge while all this is going on. It won’t do for Obama to mouth platitudes and make this into a partisan issue when many top Democrats, including his running mate, were on the wrong side during the debate on the 2005 bankruptcy bill.
I have been trying to rouse concern about this with a film “In Debt We Trust” exposing subprime loans and the role of Wall Street firms that profited on them, the regulators who turned the other way and the press that missed the story .
I have just followed up with a timely book, “PLUNDER: Investigating our Economic Calamity” (Cosimo) detailing the existence of a white-collar crime wave and a mass of victims who are losing their homes and their hope. Thirty-two publishers passed on it, many saying that I was exaggerating the depth of the problem. I wasn’t.
Even I have been shocked with the trillions of dollars that seem to being flushed down the drain, and the fact that some of the companies once considered the smartest of the smart managed to destroy themselves in the grip of greed.
So what do we do now?
l. Educate ourselves about how this system collapsed and about the need for both financial regulation and personal financial responsibility. We need to spark a national conversation about these issues.
2. Encourage the politicians we support to get away from symbolic stances and trivia and focus on our economic well being.
3. Insist that our media explains these structural problem and offers diverse perspectives on how to solve them—not just the same old pundits.
4. Demand a bill of economic bill of rights for all Americans that promotes fairness and equality. We must begin thinking about how to promote debt relief in America in the same way that Third World peoples have fought for it for years.
5. Back the campaign of the Institute for American Future to get these issues into our media and on to the agenda.
We have to stand up and be heard before—sounds stilly doesn’t it—it’s all gone!
News Dissector Danny Schechter edits Mediachannel.org and is the author of PLUNDER: Investigating Our Economic Calamity (Cosimo) now in online book stores.