Thursday, April 28, 2011

Bernanke News Conf. begs many huge questions without apparent answers

Federal Reserve Chair, Ben Bernanke, held the first press conference in the history of the Federal Reserve yesterday. Of course, his message was pablum-esque, in that, yes the recovery is proceeding much more slowly than we would like, and yes the unemployment rate is still too high, and prospects for long-term growth returning to pre-recession levels look modest into 2012 and a little better in 2013.
Nothing surprising in all that! Of course, as we all know, it is surprises that the markets detest most, including those spawned by their own foot soldiers on Wall Street. So, no one could seriously have expected Mr. Bernanke, with the eloquence of a silk tongue and a platinum intellect, with the doctorate in "depression" history, to say anything more than the highly expected.
It was the fact that he held a news conference at all that made some news. Imagine, the Chair of the Federal Reserve speaking directly in answer to questions from some 60+ reporters, from behind an oak desk, with little to no fanfare!
And then, today, Tom Ashbrook, he of On Point fame on NPR, hosted a couple of economists to review both the performance of the Chair, and of the economy, along with ordinary American callers who brought a level of drama, intensity and multiple degrees of separation from the "academic, theoretical and highly abstract rhetoric" of economic analysis to the air waves.
One specific caller, a young mother on her way to another job interview in commissioned sales, "where if the people aren't buying I don't make a dime," underscored the high and rising cost of gas to get to the interview, and to get to the  purchasers if she were to be successful in the job interview, while reminding both host and guests that her three children needed to continue to eat but she was becoming increasingly desperate about how to accomplish that rather basic goal. Job losses had hit both her husband and her, and both have taken other part-time jobs, in a valiant attempt to make ends meet.
And it hit me! There are literally millions of people just like her, in all countries, including both the U.S. and Canada, who need more work and more income just to keep their family intact. And in many other parts of the world, that same motivation is driving millions into the streets of countries ruled by dicators, whose level of accountability to their subjects is virtually zero. And, in spite of the historic news conference, what difference did/does/will both the Bernanke news conference and the "high-level analysis" by the professional class on On Point make to that young mother of three, on her way to that commissioned sales job interview?
Her world, like that of millions of others everywhere, is completely cut off from the world of Ben Bernanke, not because he is an especially toxic Chair, or because he has malicious intentions with respect to how he guides the U.S. economy, but simply because of the complete disconnect between theory and practice in the streets, neighbourhoods, businesses, and even the schools of the world's towns, villages and cities. And the theorists do not talk to those like the mother of three, for additional perspective/urgency/crisis management to guide and shape their theories into life-giving, life-saving, job-restoring, income-generating plans, strategies and tactics. It is tied up with "tax policy" and business subsidies and favoured nation trading status, and other high-sounding and perhaps even important (to some distant political or academic figure) concept. But that mother of three needs a job that pays real money, as does her husband, as do their three children, and now, not a decade in the future. And wringing of hands is no substitute for work, food and self-respect!
And the people will only put up with this disconnect for a very short time, especially as the choices between paying the heating bills and buying food for their children bear down on their frazzled psyches, and their exhausted minds, bodies and spirits.
And when they take to the streets in Paris, London, New York, Lisbon, Johannesberg, Rome, Toronto, Los Angeles, Chicago, because the new world order, including globalization, is not "working for them," who will be able to provide the answers they are looking for? And how will the world community address what is surely to become a global crisis, perhaps boiling over prior to the anticipated rise in global temperature from climate change,  if and when another perfect storm of spiked food costs leaps out to bite us all because farmers could not plow, plant and harvest their acreage due to excess water, excessive heat, excessive winds and whatever other contributors will push the systems beyond their breaking point..."because we never planned for such a complete and perfect storm" in words we have heard about earthquakes and tsunami's in recent disasters.
Have we ALL cut so many corners, now that we are becoming conscious of how wanton has been our individual and collective gluttony and greed and need for instant gratification, that the systems we took for granted, as being eminently capable of withstanding the pressures they were likely to face, can not and will not endure the pressures that are being forced upon them?...and at a time when no one has studied such a conflagration of stressors to determine a new set of equations that are needed to face the future in safety, in relatively good health and in systems that can withstand the pressure we now know they will have to withstand.
A historic news conference may be all the Chair has to offer, a face to meet and quiet the fears of that mother of three (replicated in millions of homes across America) failing the kinds of revolutionary moves that may be necessary to prevent starvation, rebellion, violence and multiple uprisings that may ensue eventually.
Certainly not now, because that would be too shocking for the system to survive...but just how long have we got, until we run out of time, answers and collective political will to implement those new answers?

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