President-elect Obama,
Congratulations, I voted for you.
With hope I'm writing to you as a high school teacher and a parent; I pray you will receive and read this message.
I've been reading in newspapers and viewing on CSPAN much in regard to the current financial crisis and the efforts to evaluate the results of the $700 billion bail out. As I listen to testimony before subcommittees, congress and senate leaders and government representatives, I am struck by the lack of discussion or realization that so much of our current economic ignorance is linked to our selfish lack of a collective investment in human capital: Education.
Few people in Congress can actually read and understand the nature of the complicated loans and financial instruments that have resulted in this massive failure. We learn the hard way that ignorance is not bliss.
In order to have informed citizens, workers, and creative inventors in this country, we need the majority of our people to be educated or enlightened. But the support for public education continues to decline. When will we realize for the sake of our children and grandchildren that economic prosperity and a healthy culture as a whole is intrinsically linked to the masses of our citizens being well educated?
A thought: Could failing banks be encouraged to adopt a failing school in their community? Would employer bonuses be better received if they were tied to the success of a less fortunate organization, a public school, that is not considered these taxpayer bailout dollars?
Please keep education reform at the forefront of your thinking when trying to work through these complicated economic market evaluations. These two issues go hand in hand. Please, our children and grandchildren depend on us.
Most Sincere Regards,
Melissa Merwin
Elk River, Minnesota
"Above all things I hope the education of the common people will be attended to, convinced that on their good sense we may rely with the most security for the preservation of a due degree of liberty." --Thomas Jefferson to James Madison, 1787. Madison Version FE 4:480
"If a nation expects to be ignorant and free in a state of civilization, it expects what never was and never will be." --Thomas Jefferson to Charles Yancey, 1816. ME 14:384
"Convinced that the people are the only safe depositories of their own liberty, and that they are not safe unless enlightened to a certain degree, I have looked on our present state of liberty as a short-lived possession unless the mass of the people could be informed to a certain degree." --Thomas Jefferson to Littleton Waller Tazewell, 1805.
Imagine if the majority of people could read, write, and think at this level like Jefferson, what kind of a world would we be living in today?
Obamanomics
To fix the economy, the president-elect should takes his cues from history.
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What About Us?
Wall Street's problems have captured the attention of Congress, the White House and the media. But ordinary folks are wondering if anyone is paying attention to them. A look at how Americans are coping with the economic crisis.
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Wall Street's problems have captured the attention of Congress, the White House and the media. But ordinary folks are wondering if anyone is paying attention to them. A look at how Americans are coping with the economic crisis.
Barack Obama's stunning election victory was a compelling mandate for change, especially in regard to the way the economy has been run. People's lives and livelihoods have been deeply affected by the financial crisis, and Americans are justifiably worried and angry. To set the economy on the right path again, new checks and balances to regulate our financial system are already being discussed and explored. But even as we start to search for new solutions, we have already come to a perilous fork in the road.
In one direction lies a backlash against capitalism. Some blame the crisis on excesses borne of laissez-faire policies that created wealth for a few at the expense of many. Given the current crisis, that sentiment may be understandable. But it is dangerous.
History teaches us that this backlash generates a populist push that can easily morph into economic policies that turn away from free trade, tax high-income earners, impede markets in the name of redistributing income, and pander to special-interest groups that cost a lot while carrying few benefits. The result can be large and long-lived effects that depress economic activity, sometimes for decades.
A lately, oft-cited case in point: the Great Depression. The 1930s brought forward an unprecedented increase in government economic intervention, and policies that substantially distorted markets and reduced economic well-being. Some of these interventions, such as the National Industrial Recovery Act and the National Labor Relations Act, gave enormous bargaining power to labor. Many economists have concluded that these policies were primarily responsible for keeping unemployment well above 10 percent until World War II, when labor's bargaining strength was reduced by the National War Labor Board.
Other New Deal policies explicitly focused on benefiting particular industries at the expense of others. Agriculture is a potent example.
Subsidies to agriculture increased substantially in 1933 with the goal of increasing the incomes of farmers. They continue to this day. Of course, farm incomes have changed substantially since the 1930s. Today, farm subsidies exceed $25 billion per year—most of which is paid to large commercial producers, some of whom have incomes in excess of $200,000 per year and net worths of nearly $2 million. These subsidies cost households about $350 per year in higher food bills.
Fannie Mae, the government-sponsored enterprise that was a major contributor to our current crisis, was the product of the New Deal, when it was determined that the government should provide an intermediary to make sure housing loans would be made. Fannie Mae might have been useful in the 1930s, but there are no convincing arguments that it was necessary after that.
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