An economy in danger

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“Why don’t we have a teach-in to discuss what this, [the current economic crisis], is about?” said George Wright, Skyline College history professor at a teach-in on the current economic crises on Wed. Oct. 22, 2008.

The teach-in, which attracted ~ 100 people to room 6-202, was in a lecture format headed by three Skyline College professors George Wright, a history professor, Masao Suzuki, an economics professor, and Nancy Kaplan-Biegel, Skyline’s journalism instructor.

“These teach-ins were the springboard for student activism” Wright said. “We hope that we come out of this with not only more knowledge, but direction.”

Suzuki’s part of the presentation focused on the economics behind our current crisis. George Bush was quoted in his presentation as saying: “This sucker could go down” regarding the economy. “Unfortunately I have to agree with Mr. Bush,” Suzuki said.

Economists are saying “this is going to be the worst depression since 1981-1982. I think it could be even worse. I’m seeing estimates of one to two trillion dollars for the federal budget deficit.”

Suzuki said the things we should watch for are a double dip in the economy, which means a drop in consumer spending leading to massive unemployment after some recovery, and the failure of large corporations leading to more job losses.

Several perspectives were offered up by Suzuki from different economists with quite varying viewpoints.

Alan Greenspan, the former Federal Reserve chairman, an advocate of a free market. “Many people see Alan Greenspan’s role in the federal reserve as a cause of the problems.”

Ben Bernanke, the current Federal Reserve chairman, is an advocate of federal intervention in economic markets. “Save the banks, save the world.”

Paul Krugman, a Keynesian economist, who advocates government intervention in the economy. He believes a lack of spending leads to unemployment, and the government needs to support the economy when the private sector stops doing so.

Paul Sweezy, who believes that capitalism has inherent flaws, such as the problem of overproduction which leads to producing more than can be sold.

George Wright’s presentation focused on the history behind the fall of our economy.

“I think we need to go back more to get to the roots of the problem. Where do I start?”

Capitalism is prone to crises. “What we see through the history of capitalism is uneven crises. “The crisis generally relates to overproduction and under consumption. There are plenty of warehouses full of goods that have been made.”

The systematic thing that causes this is that capitalists want to keep both good prices high and wages low, but the problem with this is that then people can’t afford the goods.

“This is all useful to understand but to relate it to the current crisis we can go back to the late 1970’s”

Since the 1930’s to the 1970’s a form of capitalism based off of Keynesian economics has been promoted called Corporate liberalism. This form of capitalism involved the government funding projects to help out markets and making them conform to societal rules. This worked until the mid 1960’s but in 1965 inflation increased, along with increasing unemployment resulting in stagflation.

This changed our economy’s direction.

Before the 1970’s our economy was based off of production.

After the 1970’s our economy was deindustrialized and turned into a service-based, two-tiered, anti-union system based on finance. The source of wealth changed from production to speculation.

“At the core of [that decision] was for the corporations to increase profit margins.”

Wright stressed that “this is not something that the Republicans have done alone. There was a general consensus in the political system. This is a bipartisan process.”

“This particular process we are facing right now can be traced back to 1992, [with the Clinton administration deregulation of the mortgage market].”

The changes to our economy were rationalized with under a new ideal of trickle down economics, founded under the belief that if the rich are benefiting then the results will trickle down.

68 percent of the wealth in the US is owned by 10 percent of the population. This wealth enables the rich to control politics.

Nancy Kaplan-Biegel focused on the way that the media affects perception of the crisis.

Media doesn’t tell us what to think, but what to think about it, which is done through something called agenda setting.

Agenda setting is the way newspapers prioritize stories. This occurs through the placement of a story, the angle of the headlines on the story, and repetition the story is given. The smallest factors in a headline can influence the way people come into an article.

For example on the story of the biggest break down some papers, such as the Chronicle listed the headline as “Now What?” This simple headline choice leads people to want to move on. While other headlines were angrier or sadder influencing the mood.

“It’s important because this is how we get our information. We’re basing political decisions on economic news from the media.”

There are other problems with media coverage of crises. No reporter can be 100 percent balanced. Bias is inherent in the way news is written, writers can only choose one headline, or photo, or place to lay a story out, and these factors showcase the stories.

The final problem is that “As profits become more and more important there are fewer resources to cover [the issues] in nuanced ways.”

Economic nuances can be very different from media type to media type. For example gas prices are covered more in cable news media, while housing prices are covered more in newspapers. Therefore, Kaplan-Biegel suggests consuming more than one type of media. That way you’ll be more educated about regular news and economic news.

Despite the drop-off of people around noon, there were still plenty of people in the room when the question and answer session began.

One question asked if there was a liberal bias in the media:

Wright said: The media isn’t liberal or conservative “They’re basically lobbying for what is in the interest of capital.”

Kaplan-Biegel said: You will always get a certain filtering in the media.

If crowd size is any measure of success then this teach-in was definitely a success, with all of the chairs in room 6202 being completely filled, and many people had to stand.

“I didn’t expect there to be that many people,” Ben Lopez, 25 said. “I thought it was really encouraging. The historical context made it real. It makes it more intimate and immediate. I was really satisfied [with what they presented]. Perhaps the most important thing I learned is to be more active [and] search out alternatives.”

“The only thing I would want is more, more of these teach-ins.”