So, we have a business meltdown. Who does it help or hurt, Sen. Barack Obama or Sen. John McCain?
This is a devilish question, but we are in the midst of a presidential campaign. Horns and cloven feet are everywhere.
In American politics, who fashions the best narrative wins. We all like a good yarn. A yarn is a story that sells, one that nestles nicely in our frame of reference, a story that confirms what we have always suspected.
Others, most effectively the Financial Times of London, have suggested that Alan Greenspan is responsible for both the tech bubble and the housing bubble that has now broken over our heads. But the current controversy undoubtedly helps Obama, because he has successfully presented himself to the voting public as an agent of change and, if we are in the pickle jar, we want to get out of it by the quickest possible route. Obama has managed to position himself on the side of the angels. He wants to overthrow the old order, the ancient regime that has brought only misery to the people. He is the new thing; McCain represents the tawdry status quo. And what is the status quo? Its hobnailed boot is everywhere. The status quo is represented by greedy businessmen who rake off millions in profits from the companies they trash. They then expect hard working Americans to shell out tax money to fix their broken enterprises.
The trouble began, according to the Democrat narrative, with deregulation. Once the regulators were out of the room, the jaws of predatory businesses snapped open and smaller competitive businesses were swallowed up by behemoths like AIG and Countrywide, businesses that, as we have seen, have grown “too large to fail.” The regulations removed by Republicans and Democrats in the congress who were friendly to big business, might have tempered the consciences of the CEO’s whose failures are now so conspicuous. Reestablish the regulations and everything will be fine.
McCain’s narrative is Obama lite. McCain is a proven maverick, an Obama with wrinkles and experience. Obama talks a good game, in the presence of a teleprompter, but he’s got peach fuzz on his chin. Once in office, he will become the plaything of the usual Democrat shakers and movers. There is also a whiff about him of the adamantine socialist. Aren’t community organizers larval socialists? Also, Obama has been going through an apparently endless identity crisis, vividly portrayed in both of his autobiographies. It’s not that there’s no “there” there: It’s that he hasn’t yet discovered his “there;” maybe in the sequel to the second biography. McCain’s identity, on the other hand, was formed in the crucible of the Hanoi Hilton, which was, believe you me, no Guantanamo. The narratives on both sides have been affected, if one is to believe the pollsters, by the current financial meltdown -- which favors Obama.
Because when the house collapses, one begins to look around to assign blame. It seems inadvisable to hire the same carpenter to rebuild the new house. Obama’s easily digestible analysis is that wild, wild Wall Street was let loose upon the world by the deregulation of the market place, the hallmark of the Reagan revolution. He’s the anti-Reagan. We need higher taxes on the rich and more comprehensive governmental regulation of the workplace.
Will people buy into that? There is some evidence to suggest that the much reviled Bush administration did argue for regulation of the mortgage industry. And there is plenty of evidence to suggest that, counter intuitive as it may seem, the reduction of some business taxes increases business acceleration and provides more tax revenue to Washington and derivatively to the states.
Should anyone doubt that Obama will be the next White Houes occupant, they have only to watch CNN’s coverage of the campaign? As Blitzer goes, so goes the world.