Show me the money

What is the true cost of change? This question has been on the minds of people locally recently, as they think about how to pay for some pretty hope-inspiring initiatives having to do with education and the Syracuse city and region’s revitalization. This post is not about those initiatives, but it is about the cost of change. The word “change” is all over the news when it comes to the presidential election, especially among the Democrats. So are the tremendous dollar amounts being raised by the candidates at an unprecedented rate.

The increased activity is very hopeful and promising, yet there is something that’s troubling me. I sense that, even as the looming recession — threatening to be a particularly deep one — is making people reconsider the role of debt (unregulated securities trading, subprime loans, etc) as a tentpole of our “ever-expanding” economy, nobody is investigating its role as a tentpole of our “ever-reliable” political system. More specifically… the question is: Is all this money being presently sent in by enthusiastic Americans to the Clinton and Obama campaigns, really real money?

You always hear about how young people are the biggest, most desirable, most potent force in American politics. They’re the much-desired voter demographic. When they mobilize, give time and effort and cash, that’s a sign of the health of both a candidate’s campaign and of the political process as a whole. But again this should, on closer examination, be somewhat troubling as well. Just as the financial world is now confronting scary, unanswered questions about looming “writedowns” (losses to be taken due to the credit crunch and related crises), we have yet to really assess the “writedowns” that these young voters are facing. How bad are these books?

Since the Obama campaign is now boasting more and more of increased recruitment of youthful voters and especially of more grassroots fundraising than the Clinton campaign, I suppose I could target my questions at them, but it really is a universal problem. How much of this money being donated to Obama and Clinton is charged to credit cards? Or, if it’s not being charged to cards, how much of it is coming out of the funds that really belong to the student loan officers, the bankers, and the auto dealers? Is this real money these campaigns are receiving? If it isn’t real money, but rather a bubble, then that has serious future implications.

I honestly do not understand how we can soberly and with great concern examine the American financial system as it impacts the average American — mortgages, student loans, car loans, health insurance co-pays — and (rightly) feel apprehensive about profound implications of these bubbles and debts still be felt in our economy… and yet, not blink an eye at the tremendous amounts of campaign cash flying around, asking no questions. How can you really have a stable, reliable political process that is built on debt? How can this go on without, at some point, collapsing into a tremendous political crash?

I am especially concerned at the persistence of the common truism that young American voters have some particular kind of magical power; and that any politician massively supported by them also has that magical power — as if a mystical youthful fervor or enthusiasm trumps all economic reality. And make no mistake, the youth of America are going to suffer heavily in any protracted economic downturn. (I suppose we must include up to 30-year-olds as “youth” since so many of them are still in college or other vocational training, going to grad school, or in entry-level jobs after grad school.)

The problem is not that they will suffer, and thus gain pure and powerful political focus through hardship. If only it were that simple. The problem is that the youth of America are facing a sword of economic division. Some of these young voters will come through a recession pretty well. They will stay in their homes, keep their jobs, and continue to send their kids to the best school systems and colleges, have the best available health care, and be able to pay off their debts or avoid taking on more debt. But other young voters will not. They will fall out of the badly compromised safe-house known as the “middle class.” And there is just so much of a warm mutual vision that can be kept alive in the face of those cold equations. I wonder if many of the young people gathering at ecstatic campaign rallies this winter and spring know that they may never be that close to each other again, or at least, for what could be a very long time.

The sad fact of the matter is that — enthusiasm and hope notwithstanding — America’s younger generation is now in an unusually powerless position, one which I don’t think quite has a parallel in our country’s history. What makes matters even worse is that they have been assured so routinely and repeatedly that they are uniquely and naturally powerful, favored heirs groomed to assume a legacy. But it is not so. They are in economic chains. And that is going to be a personal — and make no mistake, political — shock when the picture sharpens and the truth of the situation becomes clearer.

This is also the sword of Damocles hanging over the heads of all“candidates for change,” especially those riding on the feverish energy of “the youth vote.” When the excitement and adrenaline of the 2008 campaign is over, when a new president has been elected, and when the Inaugural Address is complete, any coalition that got them there is going to be severely stressed. The come-down is going to be tremendous (and if a fine inaugural address is going to make a difference, that will be one hell of a speech to remember). No doubt, many voters embracing these candidates already know the stakes full well.

But as we are talking “unity” and “hope” and “change,” all of these change-candidates are still exhorting Americans to literally buy into the very “indulge me now, figure out the details later” system of debt that got us into this present general mess. Like everyone else, I want to be hopeful that this election gets us all walking along together along the right track. But when a nation’s politicians are the last of the powers that be to get off the old tracks… when even the financial world and the average citizen sees the train coming… that isn’t a very hopeful sign, at all.

One thought on “Show me the money

  1. Robinia

    To be strictly parallel in the construction of your metaphor, the “bubble” needs to refer to the over-valuing of an asset (bubbles are price run-ups that overinflate asset prices). The “asset” would be the political influence that money can buy… and, try as I might, I have a hard time properly analyzing either the going prices or how much those rates buy– it is all so secretive!

    I tend to suspect that, whether or not the underlying fundamentals involved in purchasing future governmental influence are worth the cost, the asset soaks up more than a prudent share of GDP. That, of course, is why we need meaningful campaign finance reform NOW. Because there are some real perverse incentives in the current system that are holding our economy back. The situation is very similar to that of our health care system (great piece on that in the New England Journal of Medicine, here:

    As for the pervasive attitude about young people, well, this ol’ granny has felt similarly from time to time… but, you know, some of that hype is how we get the young ‘uns to do all that energetic work of representing while we stay home and read and write blogs and garden and such…

Comments are closed.