The Last Christmas of the American Golden Age

Let us all
savor the season and be appreciative of our good fortune.  I
really mean that, although what I am about to say will lead some to
think otherwise.

Earlier this year, it was href="http://www.reuters.com/article/domesticNews/idUSTRE4B28CB20081203">reported
that thirty million Americans were receiving food stamps.
 That is one out of every ten persons.  

Last
month, the USDA said 36.2 million Americans or 11 percent of households
struggle to get enough food to eat, and one-third of them had to
sometimes skip or cut back on meals.

Also
this:

The
last government statistics said 11.9 million Americans went hungry at
some point in 2007, including 700,000 children. That number was a 50
percent rise from 2006 figures.

The
percentage of persons on food stamps now, is similar to that seen prior
to href="http://www.nytimes.com/2006/08/22/opinion/22clinton.html">Clinton's
welfare reforms.  In other words, we've lost
whatever progress we made.

We are now in a
situation, such that an increase in economic activity is likely to be
met by price shocks: increases in the cost of liquid fuels, and of
food.  

When
those shocks occur, anyone -- or any company -- close to the edge of
financial ruin, will fall off the cliff.  This will lead to
more residential and commercial mortgage defaults, additional
deleveraging, wealth simply evaporating, and further contraction of the
economy.  This is not a good situation to be in.
 Goblins waiting in the wings.

We could
have used the good times to make our communities, our energy system,
and our agriculture more resilient. We did not do that; we squandered
our third wish.  

Instead, we used what
little credit we had remaining, to sponsor private jets and golden
parachutes for the href="http://londonbanker.blogspot.com/2008/12/repost-from-060608-reagan-and-obama.html">corporate
welfare queens of this golden age.

The
bankers of Wall Street now toasting the Fed’s recent largesse
from their Hamptons beach houses and yachts are the latest in a long
line of American corporate welfare queens who have lobbied for and
secured generous federal contracts, subsidies and regulatory
forbearance. As noted two weeks ago in href="http://www.rgemonitor.com/financemarkets-monitor/252626/looting-the-vaults-at-the-central-banks/">Looting
the Vaults, more has now been lent to banks by the Fed under
opaque new facilities than has been appropriated for the war in Iraq.
Both the Fed’s new facilities and the war appropriations
arguably benefit corporate welfare queens rather than serve the public
interest.

Personally, I don't
care a whole lot if some executive is sitting in a beach house in the
Hamptons, sipping 1979 Krug Clos Du Mesnil, paid for by his or her
fellow citizens.  What bothers me is the number of food stamps
that can't be printed for the $5,700 that the champagne cost.  

No,
it isn't really that.  What bothers me is how the collapse of
the economic system will lead to unnecessary starvation.  Most
will occur overseas, but some will occur here.  American MDs
will have to acquaint themselves with treatment of kwashiorkor.

Yes,
economic disparity is inevitable.  Economic cycles and crashes
may be inevitable.  But it was not inevitable that we would
waste our last, best chance for sustainability.  

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On
the way home from work today, I drove past a kickboxing gym.
 There was a giant inflatable Christmas display in front,
showing Santa and a bunch of rotund, jolly elves.  Odd
juxtaposition, that.  Imagine the elves kickboxing.  

Whatever
the coming year brings, we still can find amusement in things like that.