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Bush advisors told him downturn ‘could be greater than the Great Depression’
Tom Engelhardt, The Nation
The Day the Earth Still Stood
… our last president — in that remarkable final news conference of his … blurted out one genuine, and startling, piece of news. With the Washington press corps being true to itself to the last second of his administration, however, not a soul seemed to notice.
… Bush offered something strikingly new and potentially germane to any assessment of our moment.
Here’s what he said:
“Now, obviously these are very difficult economic times. When people analyze the situation, there will be — this problem started before my presidency, it obviously took place during my presidency. The question facing a President is not when the problem started, but what did you do about it when you recognized the problem. And I readily concede I chunked aside some of my free market principles when I was told by [my] chief economic advisors that the situation we were facing could be worse than the Great Depression.
“So I’ve told some of my friends who said — you know, who have taken an ideological position on this issue — why did you do what you did? I said, well, if you were sitting there and heard that the depression could be greater than the Great Depression, I hope you would act too, which I did. And we’ve taken extraordinary measures to deal with the frozen credit markets, which have affected the economy.”
Hold onto those “worse than the Great Depression… greater than the Great Depression” comments for a moment and let’s try to give this a little context.
… Now, as times have gotten even tougher, it’s become a commonplace turn of phrase to call what’s underway “the worst” or “deepest” economic or financial crisis “since the Great Depression.” Recently, a few brave economic souls — in particular, columnist Paul Krugman of the New York Times — have begun to use the previously verboten “d” word, or even the “GD” label more directly. As Krugman wrote recently, “Let’s not mince words: This looks an awful lot like the beginning of a second Great Depression.” But he remains the exception to the public news rule in claiming that, barring the right economic formula from the new Obama administration, we might well find ourselves in a situation as bad as the Great Depression.
Now, let’s return to our last president’s news conference and consider what he claims his “chief economic advisors” told him in private last fall. His statement was, in fact, staggeringly worse than just about anything you can presently read in your newspapers or see on the TV news. What was heading our way, he claimed he was told, might be “worse” or “greater” than the Great Depression itself. Admittedly, John Whitehead, the 86-year-old former chairman of Goldman Sachs, suggested in November that the current economic crisis might turn out to be “worse than the [Great] depression.” But on this, he was speaking as something of a public minority of one.
Stop for a minute and consider what Bush actually told us. It’s a staggering thought. Who even knows what it might mean? In the United States, for example, the unemployment rate in the decade of the Great Depression never fell below 14%. In cities like Chicago and Detroit in the early 1930s, it approached 50%. So, worse than that? And yet in the privacy of the Oval Office, that was evidently a majority view, unbeknownst to the rest of us.
It’s possible, of course, that Bush’s “chief economic advisors” simply came up with a formulation so startling it could wake the dead or make a truly lame-duck president quack. Still, doesn’t it make you wonder? What if, a year from now, the same National Bureau of Economic Research announces that, by January 2009, we were already in a depression?
I’m only saying that, on the question of just how steadily the Earth now stands, the verdict is out. Recent history, cited above, indicates how possible it is that, on this question, we are in the dark.
(20 January 2009)
I’m beginning to get nervous… -BA
Pascal’s Wager and Climate Change
Tim O’Reilly, O’Reilly Radar
… In my talks I’ve argued that climate change provides us with a modern version of Pascal’s wager: if catastrophic global warming turns out not to happen, the steps we’d take to address it are still worthwhile. Given that there’s even a reasonable risk of disruptive climate change, any sensible person should decide to act. It’s insurance. The risk of your house burning down is small, yet you carry homeowner’s insurance; you don’t expect to total your car, but you know that the risk is there, and again, most people carry insurance; you don’t expect catastrophic illness to strike you down, but again, you invest in insurance.
We don’t need to be 100% sure that the worst fears of climate scientists are correct in order to act. All we need to think about are the consequences of being wrong.
Let’s assume for a moment that there is no human-caused climate change, or that the consequences are not dire, and we’ve made big investments to avert it. What’s the worst that happens? In order to deal with climate change:
1. We’ve made major investments in renewable energy. This is an urgent issue even in the absence of global warming, as the IEA has now revised the date of “peak oil” to 2020, only 11 years from now.
2. We’ve invested in a potent new source of jobs. This is a far better source of stimulus than some of the ideas that have been proposed.
3. We’ve improved our national security by reducing our dependence on oil from hostile or unstable regions.
4. We’ve mitigated the enormous “off the books” economic losses from pollution. (China recently estimated these losses as 10% of GDP.) We currently subsidize fossil fuels in dozens of ways, by allowing power companies, auto companies, and others to keep environmental costs “off the books,” by funding the infrastructure for autos at public expense while demanding that railroads build their own infrastructure, and so on.
5. We’ve renewed our industrial base, investing in new industries rather than propping up old ones. Climate critics like Bjorn Lomborg like to cite the cost of dealing with global warming. But the costs are similar to the “costs” incurred by record companies in the switch to digital music distribution, or the costs to newspapers implicit in the rise of the web. That is, they are costs to existing industries, but ignore the opportunities for new industries that exploit the new technology. I have yet to see a convincing case made that the costs of dealing with climate change aren’t principally the costs of protecting old industries.
(19 January 2009)
The Pornography of Political Fear
John Michael Greer, The Archdruid Report
In most respects, despite the media hoopla, yesterday was an ordinary day. Amid brisk January weather, one of the world’s large nations marked the installation of a new chief executive with the usual round of ceremonies and celebrations. The transition was orderly to the point of dullness; the retiring president and his replacement had coffee together in the White House before the ceremony, and afterwards walked together with every evidence of cordiality to the helicopter that would ferry one of them back into private life.
I am not sure how many people noticed that the clatter of rotor blades as that helicopter took off put a period at the end of some of the most extravagant rhetoric of the Bush era. For the past eight years, a great many voices had insisted that the weary Texan who left the White House yesterday was about to declare martial law, suspend the Constitution, cancel all future elections, order dissidents to be rounded up and interned in concentration camps built by Halliburton, and a great deal more of the same kind. If, dear reader, you were one of the people who spent George W. Bush’s presidential terms insisting that these things were about to happen, grab a beer from the fridge and have a seat, because we need to talk.
The rumors I’ve just described were very nearly an article of faith across large sectors of the American left in the years just past. Hundreds of websites and a sizeable number of talk radio programs presented them as matters of simple fact, and vied with one another to accuse the Bush administration of the most diabolical intentions. Those who pointed out that the purveyors of these ideas never quite got around to offering the least scrap of evidence to back them tended to be dismissed with scorn. Yet the fact remains that all those claims were quite simply wrong.
It’s a bit uncomfortable to be the one who points this out, because I am no fan of George W. Bush.
(21 January 2009)
