Two Funerals

SUBHEAD: The Death of Jacko and Walter Cronkite present us with an interesting rite of passage this month...

By John Schettler on 20 July 2009 in The Writing Shop - http://www.writingshop.ws/html/two_funerals.html

One stood as a symbol of the lost American Dream, the other marked the loss of credibility, authority and legitimacy in our media and government.

Hello America.

In case you haven’t noticed, while you were watching American Idol, all the dance shows, Who Wants To Be A Millionaire, Survivor, Big Brother and a host of other nifty TV shows, the America you live in has undergone a dramatic change. Your friend, the banker, has been real busy.

image above: Walter Cronkite and Michael Jackson in their forties. After loosening standards, they fired a bloated real estate market in the housing boom, all to create phantom wealth based on nothing more than agreements between thieves. They thought they were immune from risk with their securities, CDOs, Swaps and Derivatives, but the crisis of confidence saw their securities trading game go bust as well. Most major banks are effectively bankrupt. But instead of taking their losses, they took $14 trillion in public money, passing the losses on to you and your kids. Then they took your house and credit cards for good measure, and your jobs. This accomplished, they changed all the accounting rules to revalue toxic bad debt at boom time prices, and presto chango, they announced a big comeback of profitability. The NY Time took this magic trick to task in a recent article when they wrote: “The recession — with its yawning gap between the bonus class on the one hand and the foreclosed upon and newly jobless on the other — (has created) a widespread sense that winners in this economy are produced by a game that’s rigged. Which is why the response to last week’s earnings bonanza has been a mix of, among other things, bafflement and anger. If these companies can return to the festivities so quickly, were they really having the near-death experience they and the government claimed? And if taxpayers risked their money when they backstopped Wall Street’s misadventures, why aren’t they sharing in the upside now that the party has started again? And did these companies have the time to rethink the risk culture that landed us in this jam in the first place?” No. They did not. They just got back to the same slice and dice hucksterism that created the whole mess, conveniently hiding all the losses off balance sheet and rigging the books. So the second Great Depression is now well underway—all brought to you courtesy of Wall Street and the US banking system. All across America foreclosures continue, jobs are lost in record numbers, businesses fail, retirement portfolios evaporate, marriages fail, property crime increases, the middle class becomes poor. The boomers, who thought life was about ever increasing home equity and ballooning stock portfolios, have now gone bust. They outspent every other generation by a factor of two, and now stand shocked at the edge of retirement realizing there is too little in the piggy bank to even provide a fraction of their daily needs. They are going to stop spending and save like crazy now, and with them goes the heart of the us “consumer” economy. It’s just not coming back. Don’t wait for it. The game is over. The greatest heist and wealth transfer in history has just been perpetrated under the guise of a “financial crisis.” Rich Dads at places like Goldman Sachs and JP Morgan laugh all the way to the bank. Financial bonus payouts and executive salaries reach record levels. The average American is now just one lost paycheck from being on the street. Like the entertainment shows before it, you can do little more than just watch it all on the TV news, which only tell you a sliver of the real truth. Because the media is not about presenting any true picture of reality to you, but rather all about perpetuating the fantasy illusion we called “The American Dream” and selling you all the junk and landfill that accessorizes it--24/7. But the American Dream is dying

It’s been dying for years but few noticed, mistaking the “flip that house” pump and dump scheme for real economic growth. The economy grew because we all joined in the feeding frenzy and agreed that it should. We agreed that the no doc loans were legitimate offers and legitimate risks, that the option ARMs and interest only loans were legitimate mortgages at legitimate values, that having three houses was somehow normal, (to go along with our three cars). And when it all came tumbling down we seemed shocked to learn that the lives we had been living were based on an equal measures of fantasy, unsustainable debt, and a healthy pinch of fraud. Then we switched to “American Idol” instead, to try and forget about it all, and mourned instead the death of the “King of Pop” in place of the funeral we should be having for the American Dream we all bought into at 29.9% interest.

Somewhere in that act of reflexive denial is a well of hidden shame. Because we knew, deep down, that we all played the game the bankers and Wall Street traders concocted. We played it with Visa, MasterCard, American Express and Discover, and we were the ones that walked into the bank to ask for those home equity loans, and we were the ones pushing that carts around Home Depot. We thought that we could just blame it all on Bush and Cheney, as so many of us did, myself included. We thought that we would finally settle the matter when we voted for “change we could believe in” and sent a charismatic young man to the White House. What we overlooked was the glaring fact that the White House doesn’t run our economy, and that all the agencies and power centers that do run it are staffed by banking industry insiders, the same folks that set up and delivered the pump and dump scheme in the first place. They bought and paid for Congress long ago, and they lobby ceaselessly to fend off mortgage modifications, changes to securities and derivatives trading regulations, caps on their salaries and bonuses, changes to the credit card laws, implementation of fair accounting rules. That’s how diligently they look after their wealth, and ensure their continued domination of economic policy designed to fatten their bottom line at the expense of everyone else.

All the greed, fraud, and corruption was as much our own fault as it was a product of the hucksters on Wall Street. Every con game needs a willing mark, and we were all too willing, thinking that we could also get something for nothing--nothing down and low easy monthly payments. In too many ways we all participated in the game when the good times were rolling. Remember the barfing baby teaching us all how to become day traders in the stock market for $7 bucks a deal? Remember the little bald headed bankers that were crowding into our foyer to compete for our business? Remember the snooty housewife turning down one loan offer after another to look for a better deal? In their place we now watch endless TV ads promising to negotiate away our massive, crushing debt, the inevitable consequence of our credit based society and the phony economic boom it created.

The staff writers of the Herald tribune.com in Florida exposed how the game was played there: “Unscrupulous property flippers would buy houses or condos, then drive up the price in a few days or weeks by selling it to someone they knew. Buyers used the inflated price to get bank loans for more than the property was worth, leaving money for flippers to split as profit…The deals -- many of them inflated sales among friends, family and business associates -- drove up property values and tax bills during the boom, fed bank bailouts and failures after the boom, and fueled the foreclosure wave that has gutted property values.”

After a year of research into the shady housing deals the writers concluded: “Many of the questionable flip deals were orchestrated by real estate professionals…Lenders facilitated fraud by approving mortgages on suspicious transactions…Lenders continued to finance flips even after the boom, when property values were declining and price increases should have raised suspicion…The actual amount of fraudulent land deals in Florida is likely more than $10 billion.” And that is just Florida. God only knows how bad it got in the new foreclosure capital of the world, California.

It’s easy to slam the banks for what they have done, because it was so transparently greedy and corrupt, though few could see this while they were signing their loan papers. It is much more difficult to look in the mirror and realize that “we the people” allowed them to do all of this, and indeed, we gleefully participated in it all as it was happening. We allowed a government to be purchased with lavish campaign contributions and molded by lobbyists. And someone pulled those levers in the election booth to send senators and representatives back to Washington, term after term, many occupying their seats for the better part of their adult lives. The system is there because the people put it there and now they allow it to stay in place unchallenged, unreformed, and unchanged, no matter what Change.Gov would have you believe.

Let’s face it… The banks did what they did because a wolf is a wolf. But if you want to really find a place to lay the blame, it’s because the people of this nation have become sheep. We allowed ourselves to buy into their grand casino game. We gleefully took the stack of chips they handed us and sat down at the roulette and card tables. We pulled the levers on the slot machines, called “one armed bandits” for a good reason—because the odds in all the games at Vegas are statistically rigged against the player and always favor the house. The same can be said for all the laws in the game of lending and credit. We bought into the game just like any good gambler who thinks he can beat the house and hit that big bonanza. We allowed ourselves to be branded with a FICO score and prodded and poked with penalties, interest hikes, points and fees, until we did just what the bankers wanted us to do, saddling ourselves with unsustainable debt to buy all the things we have since recycled to landfills. And through it all we simply amused ourselves to death, just as Roger Waters so glibly points out in his song by that same title in the sidebar.

Two Funerals

So yes, we mortgaged our future for a long, long weekend in our Neverland economy. Is it any wonder millions mourned Michael Jackson, a man in debt up to his eyeballs who had built a fantasy land amusement park estate to hide away from the world? They saw, deep down, a glimmering of themselves in that lost American Idol—the veritable King of the pop culture we so adulate in this country. The Jackson funeral struck a deep vein in the contemporary American soul, simply because it stood as such a glaring and obvious metaphor for the pop ridden nation as a whole. You have only to follow the top ten queries on search engines like Google and Yahoo to see what’s on America’s mind. Jackson’s funeral was followed a week later by the death of a truly remarkable man, Walter Cronkite, once touted as “the most trusted man in America.” It came right on the 40th anniversary of another moment of American greatness, the first landing on the moon 40 years ago. (What have we accomplished since?) While Cronkite’s death received due mention on the news, it was barely noticed by the rank and file compared to the media frenzy that followed the demise of Jacko. This alone is a salient comment on the sad state of the American mind and soul—as least as far as it is represented in the media these days.

James Kunstler, always on point, summed up the hidden meaning of Cronkite’s death this way:

“It wasn't about the death of one hugely esteemed individual; it was about the broad institutional failure of TV news in general and the current grievous loss of legitimacy and authority in shaping a national consensus of reality. Watching the old clips of Cronkite delivering the evening news years ago, one couldn't help weighing the contrast with the current spectacle of snide, combative, overbearing idiocy acted out nightly by the likes of Kudlow, Olberman, Kneale, O'Reilly, Matthews, and Dobbs as they shout down their invited guest commentators, pander to their demographic, and diss their rivals for ratings.” The sad state of our media is perhaps nowhere more evident than the fact that comedian John Steward of The Daily Show, on Comedy Central, is now perceived by many as one of the few touchstones to reality. His acerbic and combative comedic wit routinely dismembers mainstream media puppets like Jim Cramer and so many others, and strongly hits the nub of truth that lies behind all human laughter.

These two funerals tell our story today—one marking the death of the fantasy land economy in this nation, running on a something for nothing vapor of equity and credit, and the other marking the death of legitimacy and real authority as vested in our media and government institutions. One funeral marks the loss of something we must willfully let go, the other the loss of something we desperately need to restore. They come at a time when America most needs the psychological rite of passage a funeral provides—for we must, as a nation, lay the sham of our old economy to rest and somehow find a new legitimacy in media and government if we are ever to face and undertake the massive transformation in our “way of life” that this crisis demands.

There’s an old saying: “If you are going to dance, you have to pay the piper.” Time to pay up. Our children and grandchildren will now live in an America we would not have believed possible while we were busy flipping houses and remodeling our kitchens and baths. The gutted neighborhoods, for rent signs, long lines at the unemployment office, these are what we leave to our kids to sort out now. And how many of us will also be asking them to take care of us as well, since the old 401k ain’t what it used to be?

So things are the way they are because we allowed it all to happen, and this is the way it will continue until the people of this nation decide otherwise and demand real Change.Gov. When we demand an end to lobbying in congress, truly reform campaign contributions, purge government of financial industry insiders, set down rigorous new laws and regulations to enforce fair lending and credit practices, eliminate derivatives trading, abolish the Federal Reserve and return issuance of money to the people’s government, do away with fractional reserve lending. And this is just the start—the fire that must happen if we are to clear away rampant choking “growth” that was largely based on fraud and corruption in this country. Then the real work begins—the building out of new walkable communities, a revitalized rail system, decentralized alternative energy model, local food production, more equitable wealth distribution, a return to production of real things of value, and not pixilated “wealth” created by keystrokes in a Fed computer system. That list is so long it could take generations and never be accomplished. Or it might be accomplished in one sweeping revolution, such as that which founded this country and set us on a new course that saw the United States become the greatest nation on earth—a title it can sadly no longer lay claim to. Can we be great again?

Perhaps that is not the point at all. Can we be real again is more to the heart of the issue. Can we embrace core values of love, family, work, sustainability, frugality, temperance, forbearance, common effort, community. This is the real question before us now.

Can we discover if we really ever did believe those high sounding words ascribing the new way of life that was founded on this continent so long ago? Can we truly deserve the powers and authority, the solemn privilege and charge that the founding fathers and so many others fought to deliver into our hands—we the people, the United States of America. Will we truly become citizens of this nation and do the work before us, or will we continue to spin “Thriller” on the DJ set, settle deeper into our reclining sofas, and amuse ourselves to death with nostalgic thoughts of the good old boom times as we watch the twilight of our collective national decline?

The choice is ours.