The economy is terrible. Jobs are nowhere to be found. Wall Street bonuses are through the roof. But mainstream business journalism is still praising the con-men who created this mess, yet attacking anybody who takes real solutions -- like government spending to create jobs -- seriously.
Whatever corporate journalists say, the American economy will not recover until policymakers and the media acknowledge the mistakes of the past and move forward with a new economic agenda focused on middle-class prosperity, rather than financial evisceration by elites.
Creating jobs is key
As Annie Lowrey notes for The Washington Independent, while President Barack Obama’s economic stimulus package has dramatically slowed the pace of job losses, it hasn’t been enough to make a serious dent in the unemployment rate, which currently stands at 9.6 per cent. Without a serious new set of stimulus measures, we’ll see that rate stay near double-digits for years to come.
But the stimulus package is not the only policy relevant to the economic recovery. The financial excess that sparked the Great Recession was not an accident, and much of it was straightforwardly illegal -- even by the remarkably weak regulatory standards of the past decade.
As I emphasize for AlterNet, under President George W. Bush, bankers got away with all kinds of frauds. They’re continuing to get away with them under Obama. The allegations of wrongdoing range from cooking the books to the outright laundering of hundreds of billions of dollars in drug money.
Crime always pays
But you wouldn’t know it from reading a recent Washington Post op-ed by Reuters’ business editor Chrystia Freeland, which defines Wall Street problems exclusively as the product of government inadequacies, not deregulation. And of course, bank regulations were wholly inadequate in recent decades. Bankers lobbied hard for those rules, and pounced on the middle class once they were enacted. But Wall Street didn’t just win weak rules, they routinely violated rules that crimped profits. Crime always pays until you get caught. If bankers know they can caught and avoid punishment, they have no incentive to obey the law when doing so would crimp their bonuses.
And those bonuses are still wild and wonderful for corporate elites. As Sam Pizzigati emphasizes for Yes! Magazine, CEO pay last year was an astonishing four times higher than during the years of elite dominance shepherded by President Ronald Reagan. This kind of pay isn’t good for the economy. It’s a waste of resources that could be going to rank-and-file workers.
Business journalists skewing facts
The editorial pages of major newspapers aren’t the only places where preposterous business journalism pops up. As Kevin Drum notes, you can also read it on the pages of major mainstream business magazines.
In a blog post for Mother Jones, Drum takes down one of the worst articles on both Obama and business that has yet been written. It’s by right-wing writer Dinesh D’Souza, and it reads like a combination between a Birther conspiracy theory, a coded racist rant and a completely incoherent assault on reasonable economic policy.
Without citing any evidence, D’Souza calls Obama, “the most antibusiness president in a generation, perhaps in American history,” and goes on to blame this attitude on the “anticolonialist” views of Obama’s Kenyan father. One might expect this kind of garbage to be running in white nationalist newsletters, but as Drum highlights, the article was published in Forbes magazine, a thoroughly mainstream conservative business rag (don’t confuse Forbes with Fortune, which uncovered the Enron scam).
Obama’s baby steps
Obama could make outrageous attacks like D’Souza’s easier to defend if he proposed a set of bold, new policies to combat the recession. Instead, as William Greider highlights for The Nation, Obama is going for half-measures that will make things a little less worse, but won’t really put the economy back on track. His recently proposed tax cuts for small businesses and $50 billion in infrastructure spending will indeed create jobs– just not enough of them.
We need a robust government plan to create jobs, which means lots of spending for government hiring, expanded benefits for the unemployed, and robust government investments in the national infrastructure. All of these things will cost money, but if we don’t put people back to work, the resulting lack of economic growth will make the federal budget deficit far worse than the jobs spending will.
Helping the middle class isn’t “antibusiness,” it’s common-sense economics. If all of our economic policies are geared toward throwing money at the rich, we’ll just watch rich people hoard most of that money. Repairing our economy requires repairing the middle class. That means lots of jobs -- and in a deep recession, only the government can provide those jobs.
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