The new president’s uphill battle
November 8, 2008 – 5:05 pm by JohnRobert Higgs on the dire situation facing the new president:
On the stock markets, corporate share prices have fallen precipitously. Unemployment is rising. Housing construction has declined greatly, and home builders are going bankrupt. Many homeowners are losing their homes to foreclosure or tax sale. Many banks and other financial firms are in trouble, and some have already gone under. Loans are harder to get than they used to be, especially for the least creditworthy borrowers. At the Fed, the central bankers are baffled, sensing their powerlessness to prevent further economic contraction. The president is discredited and eager to leave office, passing responsibility for dealing with all the economic problems along to his successor. Congress has earned the public’s hostility, and the legislators’ popularity, like the president’s, has sunk to an extraordinarily low level. Desperately, blindly seeking something, anything, anyone to stop the downward spiral, the electorate has chosen a new president, giving him a wide margin of victory. Awaiting his inauguration, the future chief executive promises to clean house and turn the country around, but the public does not have a clear vision of what is coming.
Yes, in the circumstances just sketched, the year 1932 was drawing to a close, much as the year 2008 is drawing to a close. Should we expect next year’s events to resemble those of 1933? Devoutly may we hope they will not.
