To get a better idea why the Obama Administration’s efforts to stem the home foreclosure crisis have failed at both ends of the problem, you need only go back to that great scene in Frank Capra’s classic, “It’s A Wonderful Life,” where protagonist George Bailey (Jimmy Stewart) is on his way out of Bedford Falls with his new bride and high school crush, the former Meg Hatch (Donna Reed). The newlyweds are heading toward the train station to leave on their honeymoon when Meg notices a commotion outside the Bailey Bros. read more »
During the first ten days of October 2008, the Dow Jones dropped 2,399.47 points, losing trillions of investor equity. The Federal Government pushed TARP, a $700 billion bail-out, through Congress to rescue the beleaguered financial institutions. The collapse of the financial system was likened to an earthquake. In reality, what happened was more like a shift of tectonic plates.
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Everywhere you look – from the White House to Wall Street – they are painting a sunny picture of recovery, free from any gloomy ideas. Bernie Madoff is in jail, Goldman Sachs is repaying their bailout money, and everywhere they look they see “green shoots.”
Yet according to the Congressional Budget Office (CBO), the US economy and federal government are headed for doom. We are on a completely unsustainable path economically and financially. read more »
In mid August, as we were beginning to feel a pulse in the nation’s housing market, an academician and housing expert from the University of Pennsylvania named Thomas J. Sugrue wrote an article in the Wall Street Journal proposing that, for many people, the new American Dream should be renting. read more »
Urban politicians have widely embraced the current concentration of power in Washington, but they may soon regret the trend they now so actively champion. The great protean tradition of American urbanism – with scores of competing economic centers – is giving way to a new Romanism, in which all power and decisions devolve down to the imperial core.
This is big stuff, perhaps even more important than the health care debate. The consequence could be a loss of local control, weakening the ability of cities to respond to new challenges in the coming decades. read more »
When the British troops laid down their arms at Yorktown, Virginia, a colonial band played "The World Turned Upside Down," a popular air marking the absurdity of the occasion. Now the American economy is turned upside down, and the small businesses that once fortified it have exchanged places with Asian manufacturers that America once sought to protect. No man’s enlightenment is complete without the deepening amazement that comes with having seen such a reversal. read more »
America's ''kumbaya'' moment has come and gone. The nation's brief feel-good era initiated by Barack Obama's stirring post-partisan rhetoric--and fortified by John McCain's classy concession speech--has dissolved into sectarian bickering more appropriate to dysfunctional Iraq than the world's greatest democratic republic.
Yet little of the shouting concerns the fundamental economic issue facing the U.S. today: the decline of upward mobility and income growth for the working and middle classes. Instead we have politicos battling over two versions of ''trickle down'' economics. read more »
Both the world and the nation remain in the midst of the greatest economic downturn since the Great Depression. But with all the talk of “green shoots” and a recovery housing market, we may in fact be about to witness another devastating bubble.
As we well know, the Great Recession was set off the by the bursting of the housing bubble in the United States. The results have been devastating. The value of the US housing stock has fallen 9 quarters in a row, which compares to the previous modern record of one (Note). This decline has been a driving force in a 25 percent or a $145,000 average decline (inflation adjusted) in net worth per household in less than two years (Figure 1). The Great Recession has fallen particularly hard on middle-income households, through the erosion of both house prices and pension fund values. read more »
One Step for Short-term Economic Stimulus, and One Giant Leap (backward) for U.S. Energy Sustainability
The “cash for clunkers” (or CARS) program that was widely predicted to be extended by the Congress has been, if nothing else, a clear public relations win for the Obama Administration. It may also be, at least for the short-term, a shot in the arm for the beleaguered American auto industry (including domestic dealerships of foreign car companies, like Honda and Toyota). But the program’s extension may also be bad news for anyone who was hoping that candidate Obama’s campaign promises to fix our domestic energy policy would translate into something resembling a robust make-over. read more »
Nothing is perhaps more pathetic than the exertions of economic developers and politicians grasping at straws, particularly during hard times. Over the past decade, we have turned from one panacea to another, from the onset of the information age to the creative class to the boom in biotech, nanotech and now the "green economy." read more »