Crazy Times — Crazier Times to Follow

We are in a weird age.

Do the smart thing, we were told, and invest in a 401(k) retirement account. Buy into the American dream and own your own home. But lately it seems that those who put their money in low-earning passbook savings accounts or rented rather than buying may have been better off.

By Victor Davis Hanson
National Review Online

Indeed, almost all the old familiar benchmarks of modern American life seem to be going by the wayside.

The blue-chip corporations that were long the brand names of world manufacturing and finance — American International Group, Bank of America, Bear Stearns, Chrysler, Citigroup, General Motors, and Lehman Brothers — are either gone or teetering on insolvency.

The old-guard newspaper industry is fading — the Tribune Company is in bankruptcy court, Hearst at one point threatened to shut down the San Francisco Chronicle, the Rocky Mountain News is already gone. The stock price of the New York Times is worth about the same as its Sunday paper.

Washington is more confusing. Bill Clinton balanced his last budgets but raised taxes. George Bush increased deficits but cut taxes. But now taxes, spending, and deficits soar all at once. We are lectured that prior reckless federal spending and borrowing got us into this mess — but now are told that even more federal spending and borrowing will get us out of it.

We’ve seen housing sales slump when home prices were high but interest rates low. Or when prices were low but interest high. Or when prices and interest were alike high. But we never have seen a bad housing market in which both home prices and mortgage interest rates were low.

Nonsense is passed off as wisdom. Those who caused the financial meltdown walked away with millions in bonuses while taxpayers covered the debts they ran up. The big-spending government claims it may cut our annual $1.7 trillion deficit in half by 2012 — but only after piling up trillions more in national debt.

In our Orwellian world, borrowing to spend what we don’t have has been renamed “stimulus.” Those who pay no federal income taxes — almost half of Americans — can somehow be promised an income tax “cut.” In the new borrowing of trillions of dollars here and trillions there, billions of dollars now sounds like pocket change.

Read the rest:
http://article.nationalreview.com/?q=ZGYw
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