>by Don White
World leaders are suddenly realizing the global economy is sinking many times faster than expected.
Yesterday, the World Bank abandoned all attempts to sugar coat this crisis. In a shocking report, the global institution warned that the world economy will shrink for the first time since World War II and that industrial production will plunge a staggering 15% — a global depression reminiscent of the 1930s.
Last week Britian’s prime minister, Gordon Brown, came to their closest ally, America, and suggested politely that Obama may want to consider organizing some kind of global monetary attack to forestall the absolute collapse of nations financially.
I think this caught the president and his treasury secretary off guard. They haven’t the slightest idea — or resources– of how to “bailout” America, let alone the world. The Obama administration has been playing “catch up.” Every move they’ve made so far has failed because it’s either not enough or too late. At least, that’s the liberal view of things.
But conservatives believe he has gone way too far. Indeed, if it takes ten or fifty trillion dollars, that is way out of bounds, say anyone concerned with the welfare of our children and grandchildren who will have to foot the horrendous bills Obama and his secretary of treasury, Patrick Gaithner, have concocted to alleviate problems. So far, the only thing they have done is to make matters worse. What we have here is a gas fire. No amount of water will help. In fact it will make the fire spread and become more destructive.
Consider what’s going on in the major banks today and the news is all pessimistic across the globe:
* The reported that more than $50 trillion in invested wealth vanished into thin air last year.
* Superstar investor warned on CNBC that the U.S. economy “has fallen off a cliff” … is “in a shambles” … and that we are experiencing “close to the worst-case scenario.”
* The feared “D” word has spread swiftly through the news media, as the reality of depression finally sinks in.
I believe the only way to corale this financial mess we’re in is to stop spreading the “fire” by spending money. We should have let the GMs, AIGs, Bear Sterns, City Banks, and any other insolvent company go under. It’s as if we’re at Yellowstone Park during a fire. There are conservationists, real smart scientists, who believe trying to put out a forest fire is not smart. Like forests, economies need “fires” to clean out the incompentent failing companies — companies that have not earned the right to exist. The problem with us is the Democrats have no stomach for putting more union employees on the bread lines.
At the same time, they have no conscience or qualms about letting Peter pay Paul — asking American taxpayers, many of whom make far less than their union brethren, to bailout car companies where union workers have huge benefits and salaries almost no other blue collar workers enjoy.
President Obama should sit down with John Key, New Zealand president. He says his country tried to spend it’s way out of a financial crisis a few years ago and it didn’t work. Nations who do this always fail, he says, citing the Great Depression and how Europe was able to overcome the world depression far faster than in the US where President Roosevelt used the same tactics Obama is trying. Why can’t we learn from the past. Those who fail to heed lessons of the past are destined to fail. Who said that?