America’s Financial Crisis Deepens While Fat Cats Carry Away The Wealth

By James Donahue

Goldman Sachs Group this week shocked the financial world when it reported a record quarterly profit of over $2 billion and the bailed-out insurance company AIG is raising eyebrows because of plans to pay $2.4 million in executive bonuses.

Its obvious the wealthy in America are doing very well, thank you. So how can this be happening in spite of the great financial slump that is putting workers out of their jobs in every segment of society and throwing families out of their homes because they can’t make mortgage payments?

A recent story in the Washington Post noted that “the ravages of the recession, including a surge in foreclosures and unemployment approaching 10 percent, have driven thousands of families onto the streets.

The U.S. Department of Housing and Urban Development now says the number of homeless families has risen by 56 percent in urban areas. The report shows that about 1.6 million people used an emergency shelter between October, 2007 and September, 2008. The crisis has intensified since that date.

While the Obama stimulus package offered an extension of unemployment benefits for people out of work, many of the early victims of this crisis will be running out of any further government assistance in December. If something isn’t done, we are all assured of a bleak Christmas, with many families destined for shivering and possibly freezing to death in unheated vacant buildings, make-shift shanties or on park benches next winter.

There is obviously something very wrong with this picture. The rich are getting richer while the poor are losing their jobs and their homes.

This kind of condition has occurred in other nations throughout recorded history. And when the people get desperate enough, and hungry enough, they revolt. America does not need another bloody revolution, but if people in high government offices don’t start using their heads, and bringing some financial balance into the fray, we could all be in for big trouble before the year is out.

A review by Thomas Greco, Jr., in Alternet warns: “Historically, every financial and economic crisis has been used to further centralize power and concentrate wealth. This one is no different, and in fact the moves being promoted by the Obama administration and the central banks of the Western powers will take the whole world to the pinnacle of financial despotism – unless enough people wake up and claim their own ‘money power.’”

Greco noted that the nation is in a peculiar financial situation because the government is printing money to meet demand, thus creating what he calls an “unprecedented inflation of the money supply,” yet the public is experiencing economic depression.

Why is this happening?

“It is a matter of where the money is going,” Greco writes. “While the public sector (federal government) is being lavishly funded to maintain a global empire, and the banks are being bailed out to try to keep a dysfunctional and destructive financial system from collapsing, the private productive sector is being starved for credit. As a result, businesses are bankrupting, people are losing their jobs and their incomes, and lower levels of government are being squeezed because their tax revenues are shrinking.”

Greco suggests that the only way out of this mess, at least for the folks on the bottom, is to claim their own “money power.” By this he proposes things that some cities are already doing successfully, like publishing their own form of currency that is paid local workers and honored by local banks and business places.

The other form of dealing with the crisis is returning to the oldest form of trade called the barter system. This involves trading goods and services for goods and services. For example a plumber can repair the farmer’s leaky drain in exchange for food produced on the farm. Another can pick the farmer’s fruit in exchange for a meal and a place to sleep.

Americans need to be thinking creatively this year if they hope to avoid the looming financial disaster that is being created by the powers that are controlling the financial markets.