We have been told repeatedly by our politicians (they haven’t been doing much leading lately) that the economy is recovering, that we need to keep producing and consuming or it won’t continue, that we need to pass proactive legislation, et cetera. But they sit in their ivory tower and argue about hollow issues like the debt limit and attempt to fool us with accounting tricks. Meanwhile, one would think that the world is ending if you pick up a paper or turn on a news channel. Financial markets have erased their gains for this year, the Eurozone seems to be in ruin, and the unemployment rate is still high (9.1%). Why is this happening? Is it all the aftershocks of the 2008-2009 recession?
We don’t think so. Many companies went under during that time due to financial gambling done on Wall Street. But that is over and done with – entrepreneurs should be seizing the opportunity to employ the unemployed and fill the void that failed ventures left. This has failed to happen because of the irresponsible policies implemented by the central banking systems of the world, and the uncertainty around what policies lawmakers will pursue.
The central banks of the world, most notably the United States Federal Reserve and the European Central Bank, have attempted to implement damage control procedures targeted at their financial markets, as that is where a large portion of the capital needed for businesses come from. But their strategy for reviving financial markets – printing money to give to large, struggling companies – has some disastrous side effects. By printing money, these banks are essentially forcing a tax on all of us by making the money in our wallets worth less. The dollar has lost 30% of its value compared to other world currencies. This is inexcusable, and it is directly attributable to the central bankers.
Additionally, U.S. Congress has contributed to the continuing crisis due to its indecision on how to change our debt-accumulating ways. The constant talk about raising taxes, but without saying on whom, creates enormous economic uncertainty. Entrepreneurs do not want all of their gains to be confiscated, so they wait until Congress can settle its squabbles. It does not help that Congress is trying to pull wool over the eyes of the American people by using accounting tricks and bureaucratic run-arounds to make spending and tax increases look like the opposite.
The global economic crisis is not due to some mysterious economic condition or god’s wrath, but rather our leaderships’ favoring the ultra-rich and their refusal to agree on how to continue taxing the common man. They are attempting to prop up an economy that was ruined by financial crime by continuing to support those who caused the problem in the first place. Although our politicians and bankers talk about the problem of toxic assets and a poor economic climate, they are in fact the problem.