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Today's Commentary: 09.20.05
There is a Name for that Feeling
In a recent e-mail, a publisher of this column wrote and suggested that I refrain from using the words such twenty-five cent words like "ennui":. His argument was simple. The average reader doesn't know what it means.
Not that I beg to differ with such sage advice, but it does describe exactly what the American public is experiencing even if they fail to have the words to describe it. For those who have yet to reach for their dictionary, here's what it means:
ennui \on-WEE; ON-wee\, noun:
A feeling of weariness and dissatisfaction; dullness and languor of spirits, arising from lack of interest; boredom.
Our discontent with the economy has reached new depths recently and if anyone read between the lines of President Bush's recent speech, given from a location that had no audience present, you would know why.
The promise he made to the citizens of New Orleans and the storm ravaged south comes on the heels of widespread criticism of the administration and nearly every official down wind of the disaster. The promise to rebuild the area with almost $200 billion in aid is the right thing to do. The area is vital and important to the country and needs rise anew from the rubble. However, answering the question on where this money will be come from should leave all of us concerned.
No new taxes: The faith of the American public, a special group who has donated millions to the Katrina relief effort out of pockets that were not exactly bulging with cash, has proven to the world that we are worthy of international admiration. We are a people whose nature is ripe with overwhelming generosity. We see ourselves among the victims.
The real shortfall of the federal government, a failing we have been sufficiently informed of in the past three weeks, has not come from concern for and pledges to the people this administration governs. Instead it comes from a general lack of funds to respond to the crisis, in large part because of spending where spending is not necessary. The sacrifice Mr. Bush told the American public he would be need will come on the backs of those same generous people whose outpouring of money to help has made the sting of the disaster less painful for hundreds of thousands. It is how that sacrifice plays itself out that will be the hardest to take.
The promise of no new taxes did not come with the pledge of no new tax cuts. Even before the hurricane laid waste, tax cuts were eating away at the economic buffer between poverty and wealth. Much like the Barrier islands provided a geographic yellow light to approaching storms, the chance that surpluses would give us a rainy day buffer from economic disasters was removed with the President's insistence that tax cuts were stimulative. Even in clear weather, the tax cuts would not provide the theoretical boost to the economy. In stormy weather, it only exaggerated the problem.
The estimated revenue that would be raised if the estate tax is allowed to expire would pay for Katrina's aftermath and then some. Over $280 billion is expected to be generated in the four years following the expiration of this poorly conceived gift to the super rich. In fact, it would be more than enough to cover the rebuilding costs for the region while helping to keep the budget deficit from reaching elevations that are bordering on stratospheric.
That tax, as I have mentioned before, effects only a handful of people, despite the numerous farm belt campaigns suggesting otherwise. The tax, if allowed to expire, would be considered a new tax.
Once the possible impact of these economic policies take hold, the middle class will begin to realize that the deficits do matter. The feeling that follows such an epiphany, the weariness, or better, the numbness, or better yet, the feeling of helplessness at watching that debt rise may just be too much to take.
The housing bubble: You have heard so much about this problem in housing over the last six months, I'd be willing to be that ennui has set in as a natural course of events. The real problem is actually a multi-layered one that involves jobs, fuel, and shelter.
If you have tried to get into the housing market for the first time since the beginning of the year, you have found homes to be vastly more expensive than they were just two years ago. If you succeeded in purchasing a home for the first time, wrangling your way through the creative process of borrowing money for real estate that you may not have been able to afford, you kept yourself fixated on the goal. That narrow mindedness did not allow you focus on the particulars that so many previous buyers thought so important - good schools, an easy commute to the workplace from established communities with amenities.
What you have found or are about to find, will begin to effect how you spend your left over cash. Many new home owners are faced with longer distances to your work - much of the new construction was pushed beyond normal zoned areas into rural communities - higher fuel prices - which I'd be willing to bet was not a consideration in your choice of homestead at the beginning of the year - and a stagnating wage base. All you need to do is subtract these added costs from a household income that has failed to keep pace and you will find the reason for your growing discontent.
GDP I would be willing to wager that the average American cares little about Gross Domestic Product, if they understand it at all. This piece of economic data reflects how the country is running in terms of output and consumption by measuring growth. The latest report, posted at the end of August shows that GDP has slipped to 3.3%.
Hurricane Katrina is estimated to have wiped as much as a full percentage point from GDP. That percentage point is expected to be regained when the reconstruction is completed, but that could take years. In the short term however, GDP is will be impacted by poor economic decisions that have given rise to the largest deficit this country has ever faced.
The money needed to rebuild the Gulf ravaged states, as I mentioned earlier will total in excess of $200 billion. It will all come from borrowing from overseas investors who may be reluctant to lend the money if the service on that debt is beyond out ability to pay.
Simply borrowing money in our current financial state is not going to be sufficient to get the job done. Here is where the middle class will meet its greatest challenge in the coming months and years. The President will begin to cut programs and services that many middle class citizens have become accustomed to in the name of fiscal responsibility and patriotic sacrifice. You will be asked to reach deeper into those increasingly empty wallets to pay for something that was not of your creation. I am not speaking of the devastating act of God that hit the south and the economic fallout of that storm. I am speaking of the devastating act of W. that hit the surplus, drained the coffers, enriched the already wealthy, failed to create enough jobs to keep the economy strong and moved us into a war without end.
As Mr. Bush makes bold statements about confronting poverty, he is doing so by creating a new class of impoverished citizens. It is the same group that he believes will be able to fend for themselves through opportunity and ingenuity. The same group that can absorb higher costs at the risk of saving next to nothing. It is the same group that will be forced to accept the idea of smaller government, but one that has bigger debt and endless payments to service it.
That hollow, pit of your stomach feeling has a name. Ennui.
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