Wednesday, October 29, 2008

Happy days are here again?

I have been extremely busy over the last three weeks with no time to work on my site, but during this hiatus I have been searching for ideas to write about and share with the teeming masses. Overall the news is grim with economic chaos throughout the country, while locally my place of employment is now laying people off. It's hard to find something positive to write about but I believe we may be headed for an exciting ride that ends up changing this country and perhaps our way of life for a long time. Let me explain.

"Happy days are here again?", is based on a popular tin pan alley song that came out during the Depression around 1929. (I added the question mark myself.) Franklin D. Roosevelt used it as a campaign song in his 1932 run for the presidency and it has been identified with the Democratic Party since then. I consider myself politically as an Independent but I still like the song even though it was stolen by a political party. Anyway while I was looking around town the past few weeks I see trends that point to positive changes in our local area and the country.

First off - the economy.

Bill Clinton used the saying "It's the economy stupid!" for his campaign against the first George Bush. The nation's economy was taking a beating during the first Bush administration and the country was ripe for change after twelve years of Republican leadership. The savings and loan debacle hurt Bush and the Federal Government had to pay out billions to save the industry from itself. Even though the Feds got their money back lessons were not learned. Let us move ahead a few years. The second George Bush is in power and we are fighting several wars in the Middle East and there is an economic meltdown happening towards the end of his last year in office. Like father, like son.

At this time our friend Mr. Ed is asking "What does it have to do with local businesses?" I promise you I am getting to it but a little history lesson is in order.

Back in 1980 the Reagan administration borrowed billions to pay for a military buildup to force the Soviet Union into bankruptcy. During this time the Reagan tax cuts came about giving the Federal Government less money to spend so with less revenue and increased military spending the budget was a bust. In the 1980's credit cards went main stream meaning almost everyone could now get one. People would talk about their Gold or Platinum or even Titanium cards and their increasing credit limit. Wealth was no longer measured by money you had in the bank but what amount of credit you could get. The next president, Bush the First, had to raise some taxes to keep the country solvent but it may have cost him the election. But the ground was set with the first Reagan tax cuts as businesses started growing and international trade increased. President Clinton was a gifted politician who saw what was happening and decided it was good for the nation. No matter what the Republican congress did, any improvement in the economy was reflected on Clinton and he got the credit. The Fed kept lowering interests rates with the belief that the best way for individuals to gain wealth was to own their own house. This continued into Bush the Second's first term where we had a real estate boom due to low interest rates. Houses were being built everywhere and selling for ungodly high prices and people were buying them left and right, some to live in and some for investments. New designer home loans allowed people to buy a house with little or no down payment. Easy credit was everywhere but wages did not keep up. Personal bankruptcies increased as consumers could not control their spending and went too far into debt. A shadow was being lifted and we were going to see the results of over 25 years of deregulation and "moral hazard". The Republicans were very big is deregulating industries to make them more successful which worked to a degree but Capitalism breeds greed and we were to see it in epic scales never seen before.

Are you still with me? Our country's perception of wealth has changed to how much credit one could get, not by personal money saved. Since 1980 the federal government has led the way in thinking deficit spending is not only okay but the correct way to run the country. Companies and banks have learned that "moral hazard" or the knowledge that risky investments will always be bailed out by the government for the good of the country is part of the plan. Deregulation of some industries has failed. Individual citizens carry way too much debt and do not have enough saved for the future. I apologize if all this seems simplistic but it starting to come down to the local level. (Finally Mr. Ed says!)

How about something positive. Recently I stopped into two new local shops selling items I did not need but wanted. Daylight Donuts is located on Broadway next to the Papa John's Pizza outlet and sells a variety of donuts and pastries. They are scheduled to offer Broaster Chicken sometime in the future but for now they have just donuts. The other shop was Hot Box Cookies which is further down Broadway next to Cool Stuff. This place sells cookies that you design yourself. For $5.95 you can order six cookies with any toppings you want. Call ahead and they will be waiting for you. Here you have two businesses opening up during one of the worst economic times selling items we really don't need but want. I will make every effort to buy from these two businesses hoping to help them become successful. The owners are brave people and deserve our respect and business.

Another positive trend, gas prices have gone down and people are thinking. Oil prices are down because demand for gas is lower. Countries like Iran, Russia and Venezuela are now worried because the money is not flowing in and the oil money is what keeps the govenments propped up. Americans are now rethinking gas mileage and Detroit is designing higher mileage cars. I went through this in the early 70's but I think the government and private industry are in a position to change the auto industry forever.

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