A poorly managed $700 billion
Well, here we are: the U.S. economy appears to be collapsing; thousands across the country are suddenly even more concerned about losing their jobs and houses, about paying for food and school; and countless cases of corruption, mismanagement and lobbying-gone-wrong are springing up left and right, all of which culminate in a massive cloud of disappointment, mistrust, and hopelessness. I am scared for the global economy, for the ramifications of yesterday’s largest fall in stock prices in history, for how this will affect the lives and livelihoods of persons across North America and the world. Beyond my fears over economic security, I am genuinely, utterly, and overwhelmingly mad. I am mad at the powers that be who allowed this to happen; I am mad that I will be affected by the stupidity, greed and short-sidedness of a handful of suits; and I am mad that those who will hurt most from this economic crisis will not be the ones that orchestrated the mess in the first place, but millions of middle and lower income people across the world. The situation at hand is demonstrative of both the gross inequality of our world today and the extreme problems that occur when the world’s economy is determined by a few countries wealth and interests, and a few people’s unintelligent and poorly made decisions.
The mortgage crisis is a crisis of inequality. In an ideal and simplistic world, the situation could look like this: U.S. mortgages were made cheaper because they were too expensive for the average person to buy; banks saw the potential for immense profits from lowering mortgage rates and allowing individuals to finance them; and therefore everyone wins. But in reality, it is problematic that mortgages needed to be lowered in the first place in order for your normal Joe Schmo to be able to own and home, demonstrating that most people who earn an average income having trouble making ends meet; and secondly it is problematic that banks—private institutions who’s primary goal is making profits—were responsible for such lowering. The U.S. government struck out in this situation, failing not only their own citizens but also hurting the world economy and the possibility of continuing their own legacy as global superpower. Strike 1: the U.S. government didn’t care for its own citizens, and didn’t respond to lack of home-owning by offering assistance in the form of government loans, increased social housing, or a recognition that perhaps the reason people couldn’t own homes was because they were focusing all their efforts on paying for education, food, health care, and all those other unfortunate, nit-picky costs that are required for living healthy lives. Strike 2: the government failed to stop an inevitable crisis, allowing for companies to profit from a weak, rampantly unruly structure, thus turning a blind eye to home-owners needs and instead looking at the increased millions of government cronies and friends. Strike 3: in allowing for such an economic scheme to be set up in the first place, and secondly neglecting to avert a crisis, Congress is now considering passing 700 billion USD (all following figures will be referred to in U.S. dollars) to save a floundering economy. If the government had any foresight—and if there was more accountability held over both its actions, as well as the actions of the private institutions at the centre of the mortgage crisis—such large spending could have been averted and the country’s finances used for hundreds of other projects.
The price is overwhelming to me: the U.S. has repeatedly cut funding to medical, housing and social programs, and it’s monetary (note: not military) foreign assistance is minimal compared to what it spends on the war in Iraq and, now, the could-be-averted-if-we-didn’t-have-our-heads-in-the-ground economic crisis. The country is spending an unnecessary $700 billion because of it’s own stupidity, greed, and lack of foreside. Yet although the country is considering floating this massive pile of change, the U.S. is stingy on matters of domestic and global inequality. Let’s look at where this $700 billion could go, if only the government, banks, and shareholders had put a cap in rampant excesses before the bubble burst. Let’s start with AIDS: UNAIDS estimates that the world needs $41 billion each year until 2010 to ensure that everyone worldwide has access to HIV/AIDS drugs, care, and treatment. The Bush administration has been hailed for authorizing up to $48 billion to fight HIV/AIDS over the period of five years, equaling approximately $9.6 billion a year. A global immunization campaign from 2006 to 2015 would cost a mere $35.5 billion, or $3.5 billion a year. While the U.S. rhetorically recognizes how important both of these efforts are, the country offers chump change and instead has spent approximately $1.2 trillion on the war in Iraq, and is now willing to spend $700 billion on another badly planned, debacherous mess that is the current market crisis.
Really now, how much more unequal can it get? U.S. home-owners get screwed over first by too-high mortgages on top of all other expenses necessary to live in the country; and secondly by poor economic management and greed. The world gets screwed over by more money being pumped into a sometimes failing and inherently unequal market system rather than money for education, housing, food, or health care. Essentially, this money is being spent to allow for this inequality to continue. I do not deny that at this point, a bailout is necessary. But it is utterly ridiculous, irresponsible and simply wrong that this situation was allowed to occur in the first place. The world will never come close to tackling inequality if such corruption, greed and multiple turning-of-eyes continues to occur. Let this be a sign not only of the dire situation of the U.S., but of where the country’s true interests lies, and how much money it really can and is willing to spend in order to solve problems; but only if those problems are of the few and not of the many, and only the problems that are created and affect those on top of the inequality throne.