Minnesota calls itself the Land of 10,000 Lakes, and Minneapolis was known for its harsh winters and its good quality of life, including its well-maintained parks and lakes. Now, it is known as the city in which George Floyd, a 46-year-old black man, was cruelly murdered by the Minneapolis police, the men and women in whom we entrust with the great privilege and responsibility of protecting and serving our communities.
The Events Resulting in George Floyd’s Murder
The purported reason for George Floyd’s arrest was a suspected $20 white-collar crime, a fraudulent payment. The real reason was the color of his skin. Thanks to Darnella Frazier, whose account Twitter suspended for an unknown reason, we have the true story, the video of George Floyd’s death, instead of the deceptive story provided in the police report. We thank Darnella, who is only 17-years-old, for her courage, conscience and presence of mind to record it. She was traumatized by the experience, and we pray for her.
George Floyd died with an officer pressing his knee against his neck for over 9 minutes. Floyd’s tortured face pressed into the asphalt, he pled with the officer(s), speaking words that brought back the memory of Eric Garner, “I can’t breathe.” “I can’t breathe,” Floyd says; “I can’t breathe.” He calls out for his mother, “mama,” he says. He urinated on himself. (The graphic video can be found on the Internet.)
There were numerous witnesses. Their panicked concern was palpable, and they begged the officer(s) to release him, to take his knee of the visibly distressed man. The officers did not. You can hear the officers joking as George Floyd is dying. Floyd’s body slowly becomes lifeless, and when the medics came, he no longer had a pulse. He was dead. (A timeline of the events is provided here. )
This is how an American citizen, our brother, a broken man (as we all are) of faith, a human being, a child of God, died. He was treated like an animal, like his life had no value, like his person had no dignity. This is how the men we gave the privilege and responsibility of protecting and serving our communities treated one of our own. They heartlessly murdered George Floyd, and we are angry; we are traumatized; we are heartbroken, and we are fed up. We want peace, justice and revolution – not just change – but a complete transformation of our society.
Our Country Is Broken
The country, which had been suffering under decades of economic mismanagement and rising inequality, reached a fever pitch under the physical and mental stress of the pandemic, the associated shutdown, and its economic devastation. The country was (and still is) a tinder box. This was the spark that lit it on fire, in many cases, literally. Since May 25, 2020, the day George Floyd was wantonly murdered by the Minneapolis Police, there have been protests.
These protests often started out peacefully but, towards evening, would erupt into violence, as a combustible mix of opportunists, anarchists, implementing a modern version of propaganda of the deed, and/or Antifa (a violence-prone, left-wing anti-fascist group) and/or white supremacists (violent right-wing groups) looted, vandalized and terrorized the city, damaging many minority-owned businesses in the process.
Starting Friday, May 29, 2020, the city of Minneapolis was put under curfew from 8PM until 6AM, with violations being a misdemeanor punishable by up to 90 days in jail or a $1,000 fine. On the first night of the curfew, the violence had not really abated. (Images of the protests can be found here.)
The absurdity of the autopsy report is just more proof (as if we needed it) that the problem of systemic racism in our country is not simply about the police department but also a failure of our entire system of “justice.” It is an insult to our intelligence and a disgrace to our country. As Petri wrote, “[I]t is always at the moment that their knee is descending on a human neck, or their bullet is flying toward a man, or they have him in a chokehold, when this human being’s own system decides to turn against him. It is a horrible curse.”
George Floyd to the System Reforming Itself?
The key question is: can the system reform itself, to paraphrase Cornell West, who thinks it cannot. It is understandable why he would think so. It is understandable why the people, particularly younger people, who have been completely failed by the country, its supposed leaders and its institutions, would have no faith in any system within the country being capable of self-reformation.
The justifiably angry driver says to the cop, “Dad a criminal?” Nope. “Dad a thug?” Nope. “Dad shot dead by a cop made a mistake cuz you want to come with your gun drawn.” In other words, even with protests exploding across the country in response to police brutality, as the man explains, the cop came to the car with his gun drawn over the driver not using a turn signal.
We are all too exhausted and emotionally drained to do more than try to process our pain, frustration and anger. It is hard to not feel a deep sense of despair and hopelessness about the state of our country right now. We must keep fighting though, and we have our faith to give us strength. Our deepest condolences to George Floyd’s friends and family. He was known to us, and he will be deeply missed. Fellow Americans, we say this with love – Jesus’s way – the way of peace – is the only way.
One of the advantages that the United States has in comparison to India or the European Union is that, by and large, Americans all speak the same language, English, which facilitates labor mobility. (We highly encourage all Americans to learn a second language nonetheless.)
Fiscal Union, Labor Mobility and Language
The importance of speaking the same language was under-appreciated prior to Europe’s (the eurozone’s) launch of its currency and monetary union (one currency managed by one central bank) experiment, which is more commonly known as the euro. This likely resulted in labor mobility being overestimated. (Another factor of production whose mobility is important in this context is capital.)
The United States, Europe and India are all large, democratic countries or regions. However, India, unlike Europe (more specifically, the eurozone) but similar to the United States is also a fiscal union, but like Europe and dissimilar to the United States, India’s citizens speak different languages. (Although a detailed comparison of the three areas and these aspects, fiscal union and common language, are beyond the scope of this post, it is helpful to keep these similarities and differences in mind.) Thus, unlike India and Europe, the United States benefits from both a fiscal union and a common language.
The recent headlines have been focused on fiscal transfers, i.e., the federal government, which is not required to balance its budget, “bailing out” the states, with the federal government’s transfer of funds effectively being fiscal transfers between states. However, the mainstream media has not really covered labor mobility.
OCA Theory, Labor Mobility and Language
Mundell’s (1961) paper, “A Theory of Optimum Currency Areas [OCA],” presents the considerations and factors in determining whether or not an area is to be considered an optimum currency area. Mundell (p657) says, “The problem [deciding between a system of fixed exchange rates or a currency union] can be posed in a general and more revealing way by defining a currency area as a domain within which exchange rates are fixed and asking: What is the appropriate domain of a currency area?”
Mundell (p6) states that the “argument for flexible exchange rates based on national currencies is only as valid as the Ricardian assumption about factor mobility. If factor mobility is high internally and low internationally a system of flexible exchange rates based on national currencies might work effectively enough.”
On an OCA with respect to Europe, Mundell (p661) states, “One can cite the well-known position of J. E. Meade…, who argues that the conditions for a common currency in Western Europe do not exist, and that, especially because of the lack of labor mobility, a system of flexible exchange rates would be more effective in promoting balance-of-payments equilibrium and internal stability; and the apparently opposite view of Tibor Scitovsky…who favors a common currency because he believes that it would induce a greater degree of capital mobility, but further adds that steps must be taken to make labor more mobile and to facilitate supranational employment policies.”
Europe did not meet the OCA criteria, particularly labor mobility, at the time of the creation of the euro, i.e., ex-ante, and labor and, to a lesser extent, capital mobility were presumed to rise to meet the OCA criteria ex-post, after the creation of the euro. Although, capital has flowed more freely within the eurozone, the free flow of capital comes with certain risks.
For developing countries, it can pose the risk of “hot money,” i.e. destabilizing often speculative capital inflows that can evaporate when faced with an adverse condition. For an economically developed region, such as Europe, the free flow of capital can contribute to contagion. As traded securities move quickly and easily across borders, they can spread financial disruption if there are issues with those securities.
It can be argued that the creation of the euro was more beneficial to Europe’s capital than labor. European workers are often fluent in multiple languages. Yet even workers who speak different languages are limited in the countries to which they can move unless the companies for which they will be working primarily use a lingua franca, such as English, and/or the worker is able to learn the local language.
Labor Mobility and American Cities
Since Americans share a common language, it is not an issue with respect to labor mobility. Now, let us assume a symmetric natural shock, such as a pandemic, that increases the unemployment rate in each state in the country by an equal amount, say 20%. Let us also assume that half the population that is still employed is no longer required to go to an office but can work from home.
One would find that some of these people might decide to move elsewhere with a lower cost of living to decrease their living expenses even if their incomes remain the same since their barriers to doing so are limited only by their personal preferences and the costs associated with moving. Assuming constant income and lower expenses, ceteris paribus, they would have more disposable income. Thus, under the most equalizing of assumptions, workers would still likely move from areas with a higher cost of living to a lower cost of living.
Now, let us assume the same shock, but disparate unemployment rates for each state. Richter (May 22, 2020) compiled the rates here, which are “from the monthly jobs data that is based on household surveys that were collected in mid-April,” and one can see that, for April, they range from 7.9% in Connecticut to 28.2% in Nevada. His explanation for the difference is that shutting down Nevada’s large gambling and hotel industry had a strong negative impact on its economy, which seems reasonable. (The two cities have comparable population sizes and unemployment rates for February, i.e. prior to the economic shock.)
(Note, Richter states, “Since this data was collected in mid-April, it shows unemployment rates well before their peaks. The next jobs report, to be released in early June, will show the results from household surveys collected in mid-May. And those unemployment rates may be closer to the peak.”)
In a subsequent post on the same day, Richter provided an anecdote about someone he knows who moved. Once this person was no longer required to be physically present at Google’s office in Redwood City, he moved back to his parents’ house in St. Louis, Missouri, presumably to save money primarily on housing.
Richter states that for Los Angeles, the “number of working people collapsed by 23%, or by 1.16 million people, counting from December last year, to just 3.79 million workers, the lowest number in the data series going back to 1990.”
Richter adds that the “labor force…plunged by 8.3%, or by nearly 400,000 people, to 4.76 million people, the lowest since 2003. The labor force plunged because people left the county, retired, or stopped looking for work. The unemployment rate shot up to 20%.”
This is just an anecdote and early data from one city, but it is indicative of a possible trend, workers moving from cities with a higher cost of living to ones with a lower cost of living. Once more data come out, we will revisit this topic to analyze labor mobility, which is facilitated by our common language, during and (hopefully after) this pandemic period and its relationship with unemployment.
A good place to start to understand the Federal Reserve’s (Fed) response to the present crisis, its unprecedented lending, is by really understanding its response to the last one, which had been unprecedented until now. Before we are able to fully analyze the Fed’s response to the present crisis, which is still evolving and ongoing, the press or public will likely need to pursue Freedom of Information Act lawsuits for release of detailed information, as Bloomberg had to do the last time. Regarding the last crisis, the most extensive analysis of the Fed’s various lending programs was done by Felkerson (2011). Therefore, this series of posts will start there, by summarizing and explaining his analysis.
As many market participants and others know, the Fed manages the federal funds rate. This is the “standard tool” (targeting the rate, not the money supply) that the Fed uses to manage the economy. The fed funds market is an uncollateralized market in which depository institutions and government sponsored enterprises lend to each other overnight. The Fed participates in this market via its primary dealers until the effective fed funds rate falls in line with the Fed’s target rate.
Also, the Fed directly sets the discount window rates and terms (duration, haircut (overcollateralization), and collateral), which is available to commercial banks and other depository institutions. These are the key rates, and they went from approximately 5+% to 0% from August 2007 to December 2008. (It is important to keep in mind that the duration and other lending terms are key features of these arrangements.)
After hitting the zero-lower bound (in terms of short-term interest rates), the Fed engaged in quantitative easing, as explained here. Regarding the Fed’s balance sheet, the assets are publicly available here, and the corresponding increases are captured on the liabilities side as reserves (or excess reserves, with interest on excess reserves (IOER) starting in October 2008).
Fed Lending Starts – General
In addition to the reduction in these short-term interest rates (as well as IOER and elaborate forward guidance), the Fed created several special facilities. As Felkerson says, “The authorization of many of these unconventional measures would require the use of what was, until the recent crisis, an ostensibly archaic section of the Federal Reserve Act—Section 13(3), which gave the Fed the authority ‘under unusual and exigent circumstances’ to extend credit to individuals, partnerships, and corporations.” This point will become even more salient when we shift to the present period.
One of the distinguishing aspects of Felkerson’s methodology is the following: “To provide an account of the magnitude of the Fed’s bailout, we argue that each unconventional transaction by the Fed represents an instance in which private markets were incapable or unwilling to conduct normal intermediation and liquidity provisioning activities…. Thus, to report the magnitude of the bailout, we have calculated cumulative totals by summing each transaction conducted by the Fed.”
“Each transaction” are the critical words. When each transaction is counted, the total lending would be considerably higher than a methodology that counts each contract, for example, repo contract since they are often rolled over, only once, depending on how each transaction is defined.
Now, the alphabet soup of lending facilities as ordered and explained by Felkerson:
Term Auction Facility (TAF) – rate determined by auction, 28-day or 84-day term. Lending to depository institutions so that they could avoid the stigma associated with using the discount window, also acceptance of a wider range of collateral. Felkerson summarizes, “The TAF ran from December 20, 2007 to March 11, 2010…. A total of 416 unique [foreign and domestic] banks borrowed from this facility…. The Fed loaned $3,818 billion in total over the run of this program.”
Central Bank Liquidity Swap Lines (CBLS) – “The facility ran from December 2007 to February 2010 and issued a total of 569 loans…. In total, the Fed lent $10,057.4 billion to foreign central banks over the course of this program as of September 28, 2011.” His percentages calculated for each central bank were: ECB 80%, BoE 9%, SNB 4%, BoJ 4%, All Others 3%.
Series of term repurchase transactions (ST OMO) – “28-day repo contracts in which primary dealers posted collateral eligible under conventional open market operations…. In 375 transactions, the Fed lent a total of $855 billion dollars.”
Two of Bear Stearns’ hedge funds had considerable exposure to subprime mortgages, and this led to the whole firm experiencing liquidity problems. Specifically, regardless of the quality of its collateral or the relative concentration of the troubled assets to one part of its business, the firm was shut out of the tri-party repo market, on which it depended for liquidity to operate its business.
As Felkerson writes, in response, “on March 13…[it informed the Fed] that it would most likely have to file for bankruptcy the following day should it not receive an emergency loan. In an attempt to find an alternative to the outright failure of Bear, negotiations began between representatives from the Fed, Bear Stearns, and J.P. Morgan. The outcome of these negotiations was announced on March 14, 2008 when the Fed Board of Governors voted to authorize the Federal Reserve Bank of New York (FRBNY) to provide a $12.9 billion loan to Bear Stearns through J.P. Morgan Chase against collateral consisting of $13.8 billion.”
To facilitate the actual sale to Bear Stearns, the Fed created a special purpose vehicle (SPV) called Maiden Lane I. As Felkerson explains, “Maiden Lane, LLC would repay its creditors, first the Fed [$28.82 billion] and then J.P. Morgan [$1.15 billion], the principal owed plus interest over ten years at the primary credit rate [one of the discount window rates] beginning in September 2010. The structure of the bridge loan and ML I represent one-time extensions of credit. As onetime extensions of credit, the peak outstanding occurred at issuance of the loans.”
On March 16, 2008, the same day that JPMorgan Chase issued its provisional merger with Bear Stearns, the Fed set up the Primary Dealer Credit Facility (PDCF). This facility was meant to prevent these investment banks (banks that were not eligible to go to the discount window for assistance) from experiencing liquidity issues, which could quickly become solvency issues.
I use the word “prevent,” because theoretically, that is the idea with any backstop, including FDIC deposit insurance. Its creation is meant to instill confidence, and banks only avail themselves of the facility when its mere existence is not enough to prevent a run. (All of these liquidity issues can be characterized as runs.) However, just as with the discount window, the use of these facilities can come with stigma, with investors and market participants questioning the general viability of the firm when it resorts to using the lending facility.
Felkerson summarizes the PDCF as follows: “Initial collateral accepted in transactions under the PDCF were investment grade securities. Following the events in September of that year, eligible collateral was extended to include all forms of securities normally used in private sector repo transactions…. The PDCF issued 1,376 loans totaling $8,950.99 billion…. [T]he five largest borrowers account for 85 percent ($7,610 billion) of the total. Eight foreign primary dealers would participate in the PDCF, borrowing just six percent of the total. The PDCF was closed on February 1, 2010.”
Fed Lending Continued – AIG Specific
In the wake of Lehman Brother’s bankruptcy filing on September 15, 2008, to prevent AIG from failing, the Fed first created a revolving credit facility (RCF), “on September 16, 2008, which carried an $85 billion credit line; the RCF lent $140.316 billion to AIG in total,” and the Fed created a secure borrowing facility (SBF) to facilitate repo transactions; “[c]umulatively, the SBF lent $802.316 billion in direct credit in the form of repos against AIG collateral” (Felkerson).
Then Maiden Lane II “was created with a $19.5 billion loan from the FRBNY to purchase residential MBS from AIG’s securities lending portfolio,” and these proceeds were used to pay off SBF (Felkerson).
The Fed later created Maiden Lane III to “address the greatest threat to AIG’s restructuring—losses associated with the sizeable book of collateralized debt obligations (CDOs) on which it had written credit default swaps (CDS)…, [which] was funded by a FRBNY loan to purchase AIG’s CDO portfolio, [totaling] $24.3 billion” in lending (Felkerson).
Then, “on December 1, 2009…FRBNY received preferred interests in two SPVs created to hold the outstanding common stock of AIG’s largest foreign insurance subsidiaries [AIA/ALICO transactions]… On September 30, 2010 an agreement was reached between the AIG, the Fed, the U.S. Treasury, and the SPV trustees…. [They] announced the closing of the recapitalization plan…, and all monies owed to the RCF were repaid in full January 2011” (Felkerson).
Let us pause at this point and consider that the United States central bank, whose dual mandate is price stability and full employment, and which is really not supposed to be buying anything but government-issued or, at best, government-backed (Agency MBS) securities, was purchasing CDOs of uncertain value, considerable opacity and high risk to help one corporation, AIG, which had become greedy and irresponsible. The total lending ($140 + $802 + $20 + $24 + $25) was over $1 trillion dollars. It is worth repeating. AIG got over $1 trillion in aid from the Fed while regular Americans often lost their homes, lost their jobs, went bankrupt or were plunged into poverty.
Fed Lending – The Alphabet Soup Continued
However, this was not the end of the Fed’s lending to help private industry, literally entire industries. Within the money market mutual fund (MMF) industry, the Reserve Primary Fund broke the buck on September 16, 2008. It not only held Lehman’s commercial paper but had actually increased its exposure to the firm prior to its bankruptcy.
This event triggered a run on the entire industry, which was over $2 trillion at the time. (Institution investors generally treat money market funds like depository institutions, that is, they seek capital preservation not returns.) The redemptions triggered a downward spiral in asset prices as the funds were forced to sell assets to meet them.
AMLF
The Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility (AMLF) was created on September 19, 2008 to facilitate nonrecourse loans to MMFs at the primary credit rate. “Two institutions, J.P. Morgan Chase and State Street Bank and Trust Company, constituted 92 percent of AMLF intermediary borrowing…. Over the course of the program, the Fed would lend a total of $217.435 billion…. The AMLF was closed on February 1, 2010” (Felkerson).
CPFF
The mutual fund industry’s distress resulted in a flight to safety, which had an adverse effect on the commercial paper market. With companies issuing commercial paper unable to find enough buyers, the commercial paper market froze. “To address this disruption, the Fed announced the Commercial Paper Funding Facility (CPFF) on October 7, 2008. [The SPV purchased] highly rated ABCP and unsecured U.S. dollar-denominated CP of three-month maturity from eligible issuers…. The cumulative total lent under the CPFF was $737.07 billion…. The CPFF was suspended on February 1, 2010” (Felkerson).
Note that even “highly rated ABCP” are still opaque instruments, and conservative institutional investors assess the risk of the instrument typically by the issuing bank not the underlying collateral.
TALF
These liquidity provisions were still unable to stabilize financial markets, which had transitioned to an originate-and-distribute model, and “the Fed announced the creation of the Term Asset-Backed Securities Loan Facility (TALF) on November 25, 2008. Operating similarly to the AMLF, the Fed provided nonrecourse loans to eligible borrowers posting eligible collateral, but for terms of five years. Borrowers then would act as an intermediary, using the TALF loans to purchase ABS [Asset Backed Securities]…. Although the Fed terminated lending under the TALF on June 30, 2010, loans remain outstanding under the program until March 30, 2015. The Fed loaned in total $71.09 billion” (Felkerson).
Summary of Fed Lending in 2008
Felkerson summarizes all the Fed’s lending programs as follows and provides the figure below: “When all individual transactions are summed across all unconventional LOLR [lender of last resort] facilities, the Fed spent a total of $29,616.4 billion dollars! Note this includes direct lending plus asset purchases…. Three facilities—CBLS, PDCF, and TAF—would overshadow all other unconventional LOLR programs, and make up 71.1 percent ($22,826.8 billion) of all assistance.”
Note that MBS data can be found on the SOMA site. (Felkerson separated them from the traditional Treasury securities that are a standard part of open market operations.) Felkerson notes that “[i]f the CBLS [central bank liquidity swaps] are excluded, 83.9 percent ($16.41 trillion) of all assistance would be provided to only 14 [of the largest financial] institutions [in the world]…. [And] the six largest foreign-based institutions would receive 36 percent ($10.66 trillion) of the total bailout.”
As calculated by Felkerson, the Fed’s lending programs in response to the 2008 financial crisis was massive, double the nominal GDP at the time; the institutions directly benefiting were relatively few, and the risks were high. The legal justification for what was at the time unprecedented actions was flimsy, the Federal Reserve Act—Section 13(3), if not illegal.
What was the reward for the American people, whose lives and tax dollars were ultimately at stake, for all of this Federal Reserve support for a financial system that had grown too large, too corrupt and too greedy? What did you get from the Fed’s astronomical amounts of lending? You got a system that learned how to exploit the existing order and you, the American people. The Federal Reserve has become captive to these financial players and markets, and you, the American people, are its victims.
Many of us might feel understandably powerless right now, as we face numerous hardships. A dangerous pandemic is costing hundreds of thousands of lives. At present, there have been at least 240,000 deaths from it worldwide. Our democracy is slipping away. The person who has taken over the White House is evil, greedy, corrupt and traitorous, as are his cronies, who have taken over our government.
The economy is being destroyed, as Cohen and Hsu (2020) report, “more than 33 million people have joined the unemployment rolls in seven weeks…. [E]conomists expect the monthly jobs report on Friday to put the April unemployment rate at 15 percent or higher — a Depression-era level.”
Our planet is also being destroyed by greed and consumerism. Global climate imbalances are yielding strange results, such as plagues of locusts, murder hornets, and a polar vortex is forecast to hit the Northeast in the next couple days while the West is set to experience record heat.
White “vigilante justice” seems to go unchecked while black men are being subjected to modern-day lynching. More generally, the lives of black and brown people are being valued less than others. They are being treated as second-class citizens and have to operate under a different set of standards than other Americans.
Our social fabric is being eroded in other ways, as people have abandoned religious institutions, many of which have forsaken the path of Jesus and instead of worshiping God have been worshiping worldly things. Their hypocrisy and the general misguided nature of secularism has driven people into the arms of other false gods, such as paganism, scientism, or cult-like leaders, such as Richard Dawkins.
Younger people, in particular, are frustrated, as the changes they want are frequently thwarted often by older people, the people who should care about them, or the political or economic establishment, the institutions that should care about them. These are dark times for the nation and for the world, and it can all feel so hopeless.
Jesus’s Divine Power
However, for Christians and for the world, there is one great hope, one eternal light to which we can fix our fortunes and our spirits – Jesus Christ. Mathis (2020) writes, “In the final tally, Jesus stands alone. No other human has left such a deep and enduring impression on the world, and he did so in only three years of active public life.” This is an indisputable truth. No other person has had anywhere near the impact that Jesus has had.
Where did Jesus’s power come from? As Christians, we would answer from God, as he is one with the Father. For non-Christians, the broad details of Jesus’s life are the following. He was a poor Jew from Galilee, who was born in Bethlehem. He had a mere 12 Apostles. He had no social media platform, with no hoard of followers. He wrote nothing, not a single word. He had no degrees or certifications. He had no worldly titles, wealth, power or prestige (aside from being of the line of David). Jesus spoke words, and he performed miracles. He was crucified, and he rose from the dead.
Those who believe him to be a mere mortal might ask: how could his one life have transformed the world more than any other, and what insight might that provide regarding our current challenges?
Man’s False Power
The reality is that those with power now, like the Caesars of their day, will be largely forgotten or will become a cautionary tale for others aspiring to be like them and for those who are inclined to be seduced by them. None of us can predict the future, but one thing is certain: no human present or future will compare at all with the power Jesus has now and will continue to have.
Some Christians are handwringing about the state of the faith, its trajectory, particularly in the West, and the rise of secularism. They have little faith and need to have more of it in God’s plan. They need to trust him more. They need to focus on glorifying God and not themselves. They need to stop compromising their morality and Christianity for political expediency or a false sense of power. Real power rests in Jesus, in God, and we only have access to real power when we rest in him.
The Benefits of Jesus’s Power
The benefits of Jesus’s power as it resides in us is peace and hope. In our darkest hours, we can turn to him, to our Lord and our God, and know that we are loved. If we entrust in him our lives, his power becomes our power. One might ask: how does this translate in practical ways in the real world?
A feeling of peace and hope helps one continue to fight another day. One needs to keep the faith and fight the good fight until the end. God gives us that resilience. Our faith in Jesus is our strength, and as Christians, we should never forget that. We should also share his power manifested in us with others during our shared trials and tribulations. With this, we will be and will do what we are called to do – be the salt and light of the world.
“You are the salt of the earth. But if the salt loses its saltiness, how can it be made salty again? It is no longer good for anything, except to be thrown out and trampled underfoot. You are the light of the world. A town built on a hill cannot be hidden. Neither do people light a lamp and put it under a bowl. Instead they put it on its stand, and it gives light to everyone in the house. In the same way, let your light shine before others, that they may see your good deeds and glorify your Father in heaven” (Matthew 5:13-16). Amen.
A person in a negative is hard to see. Similarly, a person defined in the negative is hard to understand. To be simply and honestly Christian is to define oneself in a straight-forward and positive way: we are Christ-followers. Define who you are by defining what you are for. Are you for Jesus? If you say “yes,” then he has to be at the center of everything in your life. By everything, I mean everything.
Not in the Negative – Christian in the Positive
In this essay, Mattson (2020) highlights what we should all know and be clear about as Christians. He writes, “One of the hallmarks of following Christ is emulating his life. And this is what Christianity essentially is: Jesus. Christianity isn’t a political ideology, or a sovereign nation, or a set of laws legislating values or enforcing a society’s preferred brand of morality. Christianity is centered upon Christ.”
Instead of a positive self-definition, many Christians have fallen into this trap of negative self-definition, often leaving Christ behind as they refer to the world in which they are too much involved. Some are opposed to abortion and same-sex marriage. Some are opposed to immigrants and non-whites. Some are opposed to, more generally, “liberal culture.” The list is long, tedious, and unhelpful.
Jesus denounced immorality and hypocrisy, but he was not defined by his opposition to these things or to the Jewish religious establishment and its corruption. Instead, what defined him was what he advocated, what he taught, what he asked of us, what he said and did. This is what we follow and try to emulate.
If you are about children and families, as most people are, by the way, then actually support families. Help poor families raise their children out of poverty. If you are about a certain cultural position, say traditional marriage, then support that cause. Broken black families, in particular, could benefit from real support from Christians, meaning financial, psychological and spiritual support.
Instead of chastising others who do not fit your worldview – help those that do. If you are opposed to immigrants and non-whites, you really need to revisit Jesus’s teachings because there is no support in them for those positions. If you are opposed to “liberal culture” or “conservative culture,” how do you define those cultures? This one exercise in definition might not be as straight-forward as you might expect.
The Negative Is More Dangerous for Non-Christians
For non-Christians, the negative trap is even more dangerous. There is no one example to which they can set their compass, no star of Bethlehem, as Christians have in Jesus. They are stranded on a vast ocean, water everywhere yet not a drop to drink. What good is water if one cannot drink it, if it cannot sustain life? We have the water of life. We just have to have faith in the Word, and it will flow.
Non-Christians have to not just define themselves in the positive, as we do, but first, they have to determine what the positive actually is. What does the positive look like? Some atheists say that they do not like organized religion because it makes people into robots. Having a clear and positive self-definition as Christ-followers have in Jesus is not turning someone into an automaton. Instead, it is similar to the difference between a photo and its negative.
We are made in God’s image, and we have a clear image of God as man – an image in the positive. As any good Christian knows, emulating Jesus is hard. We will fail and fail again. We ask our God and each other for forgiveness. In this process, we become more aware of our own particular weaknesses and vulnerabilities, which we also take to the Lord in prayer to help us overcome them. There is nothing robotic in this lifelong spiritual journey. It is as individual as the prints on our hands and feet, as we are.
What is robotic, however, is looking to a stronger central government for direction on personal conduct, which really needs to be developed the hard way, that is character formation through individual introspection and reformation, and in the aggregate, a cultural unity that is as thin as the government’s decrees.
This is where Europe went astray. Its people, tired of the religious wars and their religious institutional failures, effectively abdicated morality to the government. However, governments are ill-suited for a task so complex and profound and are also even more prone to corruption than the church is while lacking a stable corrective mechanism as the church has. As argued here, Jesus Christ’s teachings are indelible and immutable; a nation’s laws are not. Once a bad leader rises to power, the country’s laws can be changed, and the leader can be hard to overthrow.
It is tempting but unproductive to define oneself by everything one is against, that is in the negative. Define what you are for, and then do the hard work of committing to those things and fighting for them. Put your time, talent and treasure into those efforts. This applies to Christians and non-Christians alike. The difference is that, for Christians, we have a clear picture – in the positive – of what that should look like.
The dangers of blind ideological adherence apply equally to all. They are not limited to a certain political party or economic school of thought. When one objectively analyzes the present state of affairs of the real economy, the federal government’s and the Federal Reserve’s (Fed) actions have been an unequivocal failure.
It is both obvious and correct to say that the economy is not the stock market, and the stock market is not the economy. It is also correct to observe that there has been a clear divergence in the performance of the stock market and the real economy, with the stock market far outperforming the real economy. This divergence goes well beyond the ongoing dysfunctions in financial markets. It is also a grossly immoral outcome for the American people who, by and large, live and operate in the real economy.
Therefore, it would be incorrect to conclude that the Fed, whose dual mandate is price stability and full employment, i.e. to make sure that the real economy is performing well, is meeting its mandate because the stock market is performing well. I think this is elementary logic.
Objective Premises, Ideological Conclusion
Krugman, however, arrives at just this erroneous conclusion given the same premises. To quote Krugman (2020) in his last opinion piece in the NYTimes, as of the present, “G.D.P. report for the first quarter. An economy contracting at an annual rate of almost 5 percent would have been considered very bad in normal times, but this report only captured the first few drops of a torrential downpour. More timely data show an economy falling off a cliff. The Congressional Budget Office is projecting an unemployment rate of 16 percent later this year, and that may well be an underestimate.” Thus, we are both of the mind that the present economy is terrible.
Now, Krugman’s description of the stock market, again in his own words, “Yet stock prices, which fell in the first few weeks of the Covid-19 crisis, have made up much of those losses. They’re currently more or less back to where they were last fall, when all the talk was about how well the economy was doing.”
Now, here is Krugman’s assessment of the Fed’s response to the 2008 financial crisis, and by extension and implication, his assessment of its response to the present crisis, “Now, one question you might ask is why, if economic weakness is if anything good for stocks, the market briefly plunged earlier this year. The answer is that for a few weeks in March the world teetered on the edge of a 2008-type financial crisis, which caused investors to flee everything with the slightest hint of risk.”
Krugman continues, “That crisis was, however, averted thanks to extremely aggressive actions by the Fed, which stepped in to buy an unprecedented volume and range of assets. Without those actions, we would be facing an even bigger economic catastrophe.”
Explanation of the Ideological Argument
Let us consider the argument Krugman provides. The first main point is that the Fed responded to both crises by lowering interest rates, which is the standard monetary policy response to an economic downturn no matter how it is triggered, and lower interest rates hurt bond markets and help stock markets since market participants have to put their money somewhere.
Thus, the stock market is being helped by the Fed as a “side-effect” of its efforts to help the broader economy. (A debate worth having is how the Fed can gain better traction on credit availability and terms and do so without relying so heavily on financial markets for their transmission.)
Krugman’s second main point, although not as explicitly articulated, is that the Fed, acting as the lender of last resort, should have and has done everything it can, a “whatever-it-takes” approach, to mitigate the economic damage. This is the same ideological view that ended up prevailing in the last crisis (see this previous post), and by his assessment, this approach was a wild success.
Then again, maybe not, since Krugman also states the following, “While employment eventually recovered from the Great Recession, that recovery was achieved only thanks to historically low interest rates. The need for low rates was an indication of underlying economic weakness: businesses seemed reluctant to invest despite high profits, often preferring to buy back their own stock. But low rates were good for stock prices.”
The intellectual incoherence is symptomatic of an intellectual disease that afflicts many of all ideological persuasions. It is an obstinate adherence to a set of beliefs even when the evidence clearly contradicts the ideology. Krugman knows this problem well. It could be reasonably argued that he popularized the term, “zombie economics,” which was the title of a book by John Quiggin, Zombie Economics: How Dead Ideas Still Walk among Us.
Ideologically Yours, Keynesian
In Quiggin’s words, which is what Krugman also believes, “For decades, their [market liberalism’s] advocates dominated mainstream economics, and their influence created a system where an unthinking faith in markets led many to view speculative investments as fundamentally safe. The crisis seemed to have killed off these ideas, but they still live on in the minds of many—members of the public, commentators, politicians, economists, and even those charged with cleaning up the mess.”
Instead of assessing the Fed’s performance based on a thorough, unbiased evaluation of the economy after the last crisis or in the midst of this present one, Krugman instead concludes that the Fed, headed by Jerome Powell, has done an incredible job, giving them and him an A grade. What is the basis for Krugman’s conclusion? The Fed has responded in what he considers Keynesian fashion. His is an analysis based on the application of an ideology, Keynesian economics – not on its actual outcome. This is essentially a variant of “zombie economics.” Even if the response might be theoretically correct, the form of the present (and past) application is clearly wrong because the outcome is clearly bad.
Intellectual Honesty Is Not Optional
The dangers of blind ideological loyalty and purity apply to all, including the right and the left, whether they are politicians, economists, or even Christians. In reality, when one objectively analyzes the state of affairs of the real economy, the federal government’s and the Fed’s actions have been disastrously bad.
To be a good economist or policy-maker, more broadly, a good intellectual, is to be intellectually honest. It is to have knowledge of various schools of thought and to dispassionately pick and choose from them based on what actually works. There are those among us who consider ourselves liberal economists but base our analysis not on the application of any one ideology, left, right or center, but on its actual outcome.
The outcome of the Fed intervention in the financial crisis, which was not fully disclosed to the public, was plainly and simply terrible, and the outcome of the present intervention is even worse. The data and facts speak for themselves. Lastly, the counterfactual is not redeeming when the reality is damning.
In the Catholic Church, today, April 29, is the feast of St. Catherine of Siena. She is a beloved figure and one of the most important mystics and church leaders in history. Her remarkable life is worth revisiting any day but particularly now for the historical similarities and for the insights it provides into the soul of the church.
Catherine of Siena was born at a time of when the Black Death was decimating Europe. Estimates of the number of people felled by the disease differ, but they range from a third to almost two-thirds of the population. Also, as Black writes, “Less well known is that the plague continued to strike Europe, the Middle East and beyond for the next four centuries, returning every 10 to 20 years.”
In the video, Skipper explains that the pathogen “remains with us today,” speculating that our herd immunity, among other changes, might have led to its decline. Hatcher remarked that “Paradoxically, society was able to cope much better in the fourteenth century with deaths on this horrendous scale than we would be able to cope today, and this is primarily because people were, to a degree, self-sufficient and independent. Whereas today, we have such complex interconnections that deaths on anything like that scale would cause complete chaos.”
Even with relatively preliminary data, it is clear that the coronavirus pandemic is nowhere near as deadly as the Plague was. Hatcher’s statement was quite prescient, as this is indeed what the world has experienced. In spite of the coronavirus being considerably less deadly, it has wreaked tremendous damage, particularly economically.
On the other hand, similar to the Plague, an entirely possible outcome might be that we will have to live with a persistent novel coronavirus much like we live with the flu. We should all have been aware of this possibility from the start of our battle with the virus.
Catherine of Siena – Mystic
Mystics are a special group within the church, and Catherine of Siena is emblematic of them. They have a special relationship with God and live in a way that others might find baffling. Their beings and their lives seem to defy the laws to which the rest of us consider ourselves subject, and their passionate devotion awes and mystifies us.
More broadly, mystics serve a greater role in the church. They remind us that the church, as a whole, is actually a mystical body. To reprise the thrust of G.K. Chesterton’s argument from yesterday’s post, Christianity is really an irrational religion. Christians are not really about checking piety or other boxes as acts of devotion.
On the contrary, our faith is and always has been expressed by the irrational: the erection of stunningly beautiful testaments of love and devotion to our creator, which are visited by tourists and are destinations of pilgrimage for the faithful the world over, lives of tremendous sacrifice as Catherine of Siena’s or, more recently, Mother Teresa’s of Calcutta. We are called to not measure and calculate our love, but to leave it all behind and to live with faith abandon to our Lord. His will be done.
Perhaps, it is hard to sense this as most Christians, wrapped up in our daily, often tedious and stressful lives, worship in a more perfunctory but hopefully still sincere manner. We go to weekly services and progress through the liturgical calendar, paying a bit more reverence during its highlights. Again, in reference to yesterday’s post, if we are the “sense,” mystics are the “sensibility” of the church.
They make their way through the world in an enviable communion with God. What would seem entirely irrational for many of us, their reclusion, asceticism, sacrifice and visions, seem entirely in keeping with who they are. In the collective, they, along with the ascetics, are the legacy of John the Baptist, who resided in the dessert, eating locusts and wild honey, calling on his fellow Jews to be baptized, with one notable baptism.
Catherine of Siena’s power and influence in the church, which was considerable, as she is credited with convincing Pope Gregory XI to return to Rome, did not really come from reason. Her power and influence came from her mysticism, her spiritual connection with God.
We are dust and to dust we shall all return. With death or the threat of it seemingly everywhere, let us remember this truth while also remembering that there are those who live and have lived among us who seem to have no fear of death. While their bodies surely return to dust, their spirits soar free of their bodies while still living. That is the power of deep faith in God. It is not rational. It is mystical.
So many people around the world turn to the Bible for consolation in their darker moments. We pray, and we read “the Good Book.” What is it about the Word of God that can be so centering? In this essay, Prior (2020) argues that it is because the Bible strikes a balance between “sense” and “sensibility,” a reference to Jane Austen’s classic novel.
Some wield the Bible like a stick, to chastise or to criticize others. Some go further; they raise it as weapon to terrorize or to frighten others into compliance with their ideas of moral conduct. Some cynically refer to the Bible, the ultimate authority, to elevate their own standing, that is to be seen by association and by others as the ultimate authority. However, the Bible neither does nor claims any of these things. Like God himself, it simply is. One sits with it; one reads it; and one is changed through a personal, mysterious dynamic.
The Bible Is a Living Contradiction
There are many translations and versions of the Bible, and many ways to read it. Perhaps one of the ways to read it would be to take note of how many times the Bible substantively contradicts itself without being contradictory or untrue. Like a person with both a right and a left arm, with a right and a left leg, its stories and statements balance each other, and it is consistent and true in its whole.
Let me more specifically define what I do mean and do not mean by contradiction. I do not mean differences in accounts or historical details, which likely simply reflect errors in translation, memory, or other expected inconsistencies with an extremely old document. (See Sommer’s rather tedious enumeration.) I also do not mean incongruities between the Bible and the scientific understanding of man and the universe because if one believes in God, the rest is moot.
What I mean is that the Bible provides both guidance and no guidance. It gives answers and poses questions. It gives clarity while retaining mystery. The contradictions are the stories themselves. God gave man both free will and the Law to follow. The Bible asks us to believe in Jesus’s miracles, which includes raising people from the dead, and in Jesus’s death on the cross. Why would a man who is the son of an omnipotent God not save himself?
Well, to understand the answers to these questions is to better understand Christianity and why it provides solace for so many. One of the most striking aspects of the Bible is that one would normally find contradiction discomforting, yet in it, people find the opposite, they find comfort.
Atheists Misunderstand the Bible
Atheists often raise “contradictions” as proof of the Bible’s intellectual or inherent weaknesses and its false claims to divine inspiration. Sommer writes, “Humanists reject the claim that the Bible is the word of God. They are convinced the book was written solely by humans in an ignorant, superstitious, and cruel age. They believe that because the writers of the Bible lived in an unenlightened era, the book contains many errors and harmful teachings…. The Bible is an unreliable authority because it contains numerous contradictions. Logically, if two statements are contradictory, at least one of them is false. The biblical contradictions therefore prove that the book has many false statements and is not infallible.”
The opposite of an “unenlightened era” must be the Enlightenment. However, as Prior notes, the reaction to the Enlightenment was the equal and opposite reaction of Romanticism. Atheists’ argument reflects not just their inability to understand God but also, perhaps mainly, their inability to understand man.
G.K. Chesterton (1904) wrote, “Rationalism is fighting for its life against the young and vigorous superstitions…. Christianity, which is a very mystical religion, has nevertheless been the religion of the most practical section of mankind. It has far more paradoxes than the Eastern philosophies, but it also builds far better roads…. The Christian has a Triune God, ‘a tangled trinity,’ which seems a mere capricious contradiction in terms.”
There is a sort of Weberian quality to this line of Chesterton’s argument in which he implies that the very contradictions of Christianity lend themselves well to a more productive and prosperous society. Of course, exercising my own reason, he clearly provides no empirical evidence to back up his assertion.
However, from a strictly intuitive sense, perhaps a religion that comfortably lies at the intersection of the rational and the emotional, of the known and the unknown, of God and man, would also give man the best sense of balance to deal with all of the uncertainties of life. If one’s certainty rests in God, the uncertainties of life are but a drama in which one participates but does not direct. In this knowing, one can find liberation and resilience.
Chesterton also expresses these contradictions as follows, “The difference then is very simple. The Christian puts the contradiction into his philosophy. The Determinist puts it into his daily habits. The Christian states as an avowed mystery what the Determinist calls nonsense. The Determinist has the same nonsense for breakfast, dinner, tea, and supper every day of his life.”
Chesterton continues, “The Christian, I repeat, puts the mystery into his philosophy. That mystery by its darkness enlightens all things. Once grant him that, and life is life, and bread is bread, and cheese is cheese: he can laugh and fight. The Determinist makes the matter of the will logical and lucid: and in the light of that lucidity all things are darkened, words have no meaning, actions no aim. He has made his philosophy a syllogism and himself a gibbering lunatic.”
To translate Chesterton for those less initiated in his style, by accepting the contradictions and the mysteries, Christians end up being more consistent than the rationalists or the Determinists. We own the contradictions, and therefore, in a consistently paradoxical way, the inevitable opaqueness of our beliefs ends up providing more light and being more transparent than others’ “more translucent” attempts to enlighten the world or to be truly honest.
Like the Bible – Man Is a Walking Contradiction
One might ask why. How could this be? Simply, because people are naturally contradictory. Thus, a religion that can honestly and authentically capture man’s state is going to be truer to man as he or she is. Christianity is not founded on an ideal idea of a person, but at its foundation is the Judeo-Christian understanding of a fallen man.
A perfectly rational man, as the humanists suggest we should all aspire to be, would not be man at all. It would be a computer or a robot. To be human is to be both rational and emotional, to have both sense and sensibility, to love books and argument and to love art and wonder. The Bible perfectly captures these divinely contradictory combinations such that in it, we find balance, and with it, we find wholeness, comfort, and God.
Let us retreat briefly to, by comparison, Generation X’s halcyon days of latchkey, Prozac, grunge and a general, somewhat melodramatic, malaise. Compared to their prime working years, the ages of 25 to 54, Gen X’s childhood and young adulthood seem rather romantic in retrospect.
Their parents sucked up to corporate management, with big hair to match big heads, eager to ascend the corporate ladder and stroke their egos along the way. Their children, now in broken homes, had to fend for themselves. Television became their best friends, maybe Mario Brothers, and there were the occasional bike rides with friends to the local candy store. Summers were spent outdoors, avoiding dysfunctional adults as much as possible.
Cutoffs for Gen X and Gen Y
The cutoffs for generations are not hard and fast, but for this purpose, Generation X were people born between the years of 1965 and 1980, and Millennials were born between 1981 and 1995. Placing the financial crisis in the year 2008, the oldest Gen Xers have or will turn 55-years-old this year, which means they turned 25 in 1990 and 43 in 2008. The youngest Gen Xers have or will turn 40-years-old, which means they turned 25 in 2005 and 28 in 2008. By comparison, the oldest Millennials have or will turn 39-years-old, which means they turned 25 in 2006 and 27 in 2008. The youngest Millennials have or will turn 25-years-old this year, the start of their prime working years.
Younger Gen X and Older Gen Y Hit Hard
As one can see by the breakdown, the generation that was the most affected in terms of prime working years by both the financial crisis and the present coronavirus crisis is Generation X. In fact, it is the most negatively impacted generation in other respects also. Both Gen Xers’ and Millennials’ parents are typically Boomers.
However, as the Boomers’ wealth increased over time, Millennials generally had more resources available to them than their Gen X siblings or counterparts. This gave Millennials a financial advantage as well as a social advantage, as the divorce rate stabilized, and their single mothers who had entered the workforce were better able to manage both work and family.
The resentment that these two generations, Generation X and Millennials, feel toward the Boomers is not just about the fact that the Boomers have effectively directed available resources for their benefit as described here, it is also that crises are, obviously, intensely destabilizing and damaging, particularly for those for whom it overlaps with their prime working years. Generation X and Millennials are the only two generations that have had their prime working years impacted by two crises. These crises also occurred in relatively short succession, a little over a decade apart.
It is quite different to try to weather a crisis after establishing a career than while entering the workforce or while still in the early part of one’s career. The younger Gen Xers and the older Millennials were still relatively young when the financial crisis hit, and they bore the brunt of the damage in terms of their careers. In fact, many younger Millennials might not have been nearly as impacted as older Millennials since many of them were still in school. The youngest Millennials were 13-years-old at the time of the financial crisis.
Gen X and Y – Resentment and Request
Although the Boomer generation has been a catastrophic failure, there is something rather simple that they could do that would help their children, if they care at all about them. They could retire. (We understand that there are some Boomers who sincerely cannot afford to retire at the standard age.) Many Boomers, however, remain in the workforce out of greed, power, and ego. Perhaps some Boomers think the world cannot manage without their genius and expertise, but we assure you, it can. We can quite reasonably argue that it might actually thrive again.
More generally, the Boomers’ “leadership” is entirely unwelcomed by younger generations at this point. Their generation’s management of the country has been an abysmal failure. Under their watch, there has been a deterioration in every aspect of American life: family, faith, work, the economy, societal bonds, political stability and on and on. And there have been two catastrophic crises.
The Boomers need to retire and allow other generations to lead and to fill their often coveted positions. We will do a better job than they did because there is nowhere to go but up. Our society is guaranteed to improve. So, Boomers, you have damaged our country and our careers enough. If your egos can possibly manage it, please retire. Trust us – we got this.
There are so many pieces on how the Baby Boomers have destroyed America, it is hard to choose which ones to highlight here. These articles are sometimes written by Boomers, the ones who can actually speak of the shameful, hard truths and not resort to callous defensiveness. They are the ones who can actually weigh the truth about the negative impact their generation has had on every subsequent generation as more important than their own personal feelings or the need to whitewash their generation’s awful legacy.
Perhaps the most entertaining piece written by a Boomer, although he does not want to be grouped with them, was Paul Begala’s (2017) essay, in which he states, “I hate the Boomers. I know it’s a sin to hate, so let me put it this way: If they were animals, they’d be a plague of locusts, devouring everything in their path and leaving but a wasteland. If they were plants, they’d be kudzu, choking off every other living thing with their sheer mass. If they were artists, they’d be abstract expressionists, interested only in the emotions of that moment—not in the lasting result of the creative process. If they were a baseball club, they’d be the Florida Marlins: prefab prima donnas who bought their way to prominence, then disbanded—a temporary association but not a team.” You get the idea. It is not a flattering portrait.
Boomers’ Defensiveness
Many Boomers, however, when confronted with these hard truths and unflattering realities about their legacy, react not by extending understanding and solidarity with the generations who have to live with the painful consequences of the Boomers’ decisions and actions, but rather, in a predictably egotistical and narcissistic fashion, by expressing outrage and hurling insults at those who have the temerity to call them out for their hypocrisy, selfishness, immorality and incompetence.
As Lewis (2019) wrote, “The 63-year-old—yes, Willetts is a Boomer himself—is well aware of the subject’s emotional resonance. Mostly, though, he is surprised that the rage tends to come not from Millennials, who feel disadvantaged, but from the Boomers, who feel attacked…. When we have all this power, we shouldn’t be surprised when younger people are rather resentful,’ he said. ‘I’m surprised they aren’t angrier.’”
Actually, we are angry and resentful. It is just that every time younger people express their justified outrage, either through calculated arguments or organic memes, such as “OK Boomer,” at the injustice we have experienced for the past about half a century under the Boomers’ tyranny of the vote and governance, the Boomers, like locusts, to use Begala’s imagery, swarm down upon us in an attempt to suppress our First Amendment right and silence us into submission. We will not be silenced.
Boomer Socialism
The Boomers have chosen to never make any sacrifices and instead have insisted on voting based on what is exclusively in their interests, without any regard to the interests of future generations, a consideration that prior generations paid to them. The ramifications of the Boomers’ decisions are evident in all aspects of our lives: housing, the economy, climate change, health care, education, child care; you name it, the Boomers have shaped the policy to their benefit and to other generations’ detriment.
The most obvious specific examples are in health care and housing. To point out the obvious, it is the height of hypocrisy to want Medicare for oneself but not for others, as this voter (granted a bit older than a Boomer but still reflective of the generation) expressed, Glueck and Tavernise (2020) “‘I don’t like Warren and I don’t like Bernie because they want “Medicare for all,”’ said Alan Davis, 80, dismissing the single-payer health care system promoted by Senator Bernie Sanders, 78. ‘I’m totally against it. I have a good health plan.'” In other words, socialism for older people, not to mention, for the rich and for corporations, but capitalism for everyone else.
As Thompson (2020) wrote, “The federal government already guarantees single-payer health care to Americans over 65 through Medicare. Senior citizens already receive a certain kind of universal basic income; it’s called Social Security. While elderly Americans might balk at the idea of the government paying back hundreds of billions of dollars in student debt, they are already the grand beneficiaries of a government debt subsidy: The mortgage-interest deduction, a longtime staple of the federal tax code, effectively compensates the American homeowner (whose average age is 54) for their mortgage debt, thus saving this disproportionately old group approximately $800 billion in taxes owed to the federal government each decade. The economist Ed Glaeser has likened these policies to ‘Boomer socialism.'”
In addition, with respect to housing, it is not just the mortgage-interest deduction, but as Lewis wrote, older people often actively prevent more housing from being built, which increases its cost; “Often, Willetts would…then head over to a local residents’ association meeting, where he would talk to ‘completely decent people’ in their 50s and 60s who owned their own home but wanted no further houses to be built in their neighborhood.”
More generally, the Boomers ushered in the era of “greed is good” under Reagan. This period was the beginning of the end for the country and for the labor movement that had been considerably strengthened, essentially during the Bretton Woods period. The new era corresponded with a focus on consumerism, with consumer demand becoming the driver of the US economy, along with it, a trade deficit, financialization, and these changes among others created gross imbalances in the economy, particularly between the haves and the have-nots, which inevitably also meant between old and young, and contributed to the destruction of the planet. The Boomers are also the reason that the nation, really the world, is suffering under Trump and his corrupt, incompetent administration.
Pew’s Maniam and Smith (2017) found that “In 2016, as in recent years, Millennials and Gen Xers were the most Democratic generations. And both groups had relatively large – and growing – shares of liberal Democrats: 27% of Millennials and 21% of Gen Xers identified as liberal Democrats or Democratic-leaning independents. By contrast, Boomers and Silents were the most Republican groups – largely because of the higher shares of conservative Republicans in these generations. Nearly a third of Boomers (31%) and 36% of Silents described themselves as conservative Republicans or Republican leaners, which also is higher than in the past.”
Boomers’ Political Dominance
The unfortunate reality is that the sheer size of the Boomer generation has distorted our politics. As Lewis said, “Boomers have bent the gravity of politics toward themselves and their needs.” Some have claimed that this is ageism or a phony generational divide. It is not. It is based on reality. It is based on facts. It is based on statistics. It based on hard truths. Deal with it. The real impact that an extremely large, selfish and short-sighted generation has had on American politics and economics is ultimately, as we are witnessing now, to the detriment of all Americans. After all, it is older Americans that are most vulnerable during the coronavirus pandemic, and they are also the ones who put an entirely unfit president in the White House.
The Boomers are the single worst generation in, at least recent, American history. No amount of outrage or defensiveness on their part is going to change that reality or assessment. They are the reason our nation is at this absurd point, and they need to own it. Despite their reflexive defensiveness, the Boomer generation needs to be held accountable for their actions, including their vote. We will not participate in the whitewashing of what is obviously a terrible legacy, their complete failure in judgment, decision-making and governance.
Unfortunately for the rest of our society, we are also facing the reality that we have to deal with or clean up their mess. The only way to end their political dominance is for younger generations to vote in large numbers based on their own interests. A fair and well-functioning democracy reflects the diversity of its constituents, and one of those important factors is age. It is as legitimate a consideration as any other aspect of one’s identity. Let us make sure our interests are being represented at all levels of government. Gen X, Y, Z – let’s band together, and let’s vote and run for office. Let us define our destiny.
