By Moe Bedard
More money has been thrown at the current economic crisis than any other economic crisis in American history. Already, trillions of dollars have gone to bail out the financial sector, billions more have gone to automakers. Main Street hasn’t seen any of this money and is still wondering when the recession will be over. This state of affairs makes it clear to me there are two economies at war with each other in America: the economy of the private sector and the economy of Main Street. Main Street, my friends, is losing the war. The private sector seems upbeat about their prospects and frankly it makes me sick given the state of Main Street in America.
Yesterday I heard that El Centro, California had an unemployment rate above 24% and that every major metropolitan area in the United States saw an increase in unemployment last month. I think the most important question to ask is when the economy will get better for Main Street…not Wall Street, nor any other agency, public or private that gets bailout money. It’s clear the bail out funds are not for us.
Some major companies are indicating the economy will bottom out in 2009. Take Bank of America for example. In the last few years they have acquired Countrywide and Merrill Lynch, while at the same time accepting 45 billion in government aid. Ken Lewis, CEO of B of A commented recently on mixed signals in the economic sector indicating:
“When you see mixed signals, I think it signals that you’re getting close to the bottom. You can’t throw as many things as we’re throwing at it and not break the back of this thing,” (Marketwatch).
Ken Lewis’ positivity is understandable: his bank is doing better than most; they’ve received 45 billion in aid and have been able to acquire two of the largest financial companies in America. Good for Ken Lewis! What about the American public?
One of the most frustrating aspects of this economic crisis is that few government representatives are explaining how any of our tax dollars will immediately help us. It’s clear our tax dollars are helping major corporations in a big way, but it’s hard for me to understand how all of this aid will eventually “trickle down” to the average citizen. When one out of four people in any city in America can’t find a job it calls for an immediate response from the government…especially if they have the means of providing trillions in aid to private corporations.
Today’s Wall Street Journal sheds light on the fight Main Street has in the coming years. Whereas Bank of America may perceive that 2009 will be an economic bottom for them, the Journal predicts that “while employment tends to lag the broader economy, if the U.S. keeps losing jobs at a pace of 650,000 per month well into the year, it could prevent a sustained, consumer-led recovery from taking hold” (Wall Street Journal).
Everyone in America that pays any attention to the economy knows that our economic strength as a nation comes from consumer spending. It makes no sense to me that Bank of America forecasts a bottom when Main Street loses hundreds of thousands of jobs monthly. If our economy is based on consumer spending and if Main Street can’t work to spend I see no reason to believe the economy will hit bottom soon for Main Street.
Make no mistake…Main Street is at war with the private sector and we are losing the battle. How much longer will we accept the status quo?
i thought main street was the private sector.
do you mean private sector vs. public sector?