It has been intriguing to read complaints on the right about the Democrats and their supporters blaming the Republicans for the financial mess, when, they argue, so much of it was the Democrats’ fault what with bad legislation, pressure on banks and refusal to agree on any kind of control of Fannie Mae and Freddie Mac. How is it possible to be that cynical and for the populace to be that credulous?
I suppose we shall not know just how credulous the populace is until the results start rolling in on November 4 5 but I could not help thinking back to the 1945 General Election in Britain, the one that Churchill’s Conservatives so shockingly lost.
There is a great deal of rather vague historical rationalizing along the lines of people wanting a new order and the war democratizing the British society to an extent not known before. This rather clashes with what we know about the fifties but let that pass. There may have been a feeling that something new was required after a war of that magnitude, though the feeling did not last.
What is far more rarely discussed is the dishonest Labour Party campaign that focused on the issue of “guilty men”. In not very subtle terms this was a campaign that blamed Britain’s unpreparedness for the war and, indeed, the fact that the war even happened on the Conservatives who had refused to rearm in the thirties, thus finding themselves unable to stand up to Hitler in 1938 and fighting a losing battle in 1939. After he had lost the election Churchill added his own version of the tale, which was substantially the same as the Labour one.
This is neither true nor fair. Rearmament had started in the mid-thirties under Baldwin and continued under Chamberlain. The latter may have thought it was worth negotiating with Hitler at a time when Britain was not ready to go to war but he was never so deluded as to think that rearmament could be abandoned. Yet Chamberlain’s name has gone down in history as the epitome of stupid, unimaginative appeasement. Even Andrew Roberts wrote recently that Chamberlain’s achievement, of which he was justly proud, of making Britain much better prepared for the fight with Germany was “unintentional”. A very unfair comment and unworthy of Mr Roberts.
One very important reason why rearmament was slower than it should have been was the determined opposition to it by the Labour Party and the trade union, the very groups who were proclaiming the “guilty men” theory of history about the Conservatives. Negotiations with the unions were interminable and much that could have been built or produced was not. It is worth noting that the trade union problem that bedevilled Britain till the eighties was becoming serious in the thirties but grew exponentially during the war and in the decade after it. I suspect Churchill’s American admirers do not know how much of it was his fault for giving in to them without any fighting, not just during the war, when this course of action might have been justified even when the unions went on strike at times of great danger to the country, but in his second premiership of 1951 1955.
Some years ago, when I was working on my doctoral thesis I discussed this subject with my supervisor, none other than A. J. P. Taylor, life-long member of the Labour Party and, possibly, even further left than that. He maintained that he had realized at a very early stage that Germany would be a threat to Britain but that he had also supported the Labour Party’s opposition to rearmament. When I asked him why the party that, allegedly, saw through Hitler’s mask should not have wanted the country to be prepared for war, if necessary, he explained that they had been convinced of Baldwin‘s aim in rearming being to attack the Soviet Union. It sounded like he still thought that many decades later. If a man of his intelligence could believe all these contradictory ideas, what can one expect from an average left-wing academic or analyst?
And so the myth of “guilty men” was born and is believed by many to this day: the stupid or, possibly, pro-Nazi Conservatives who carelessly or treasonously left the country open to Hitler’s blackmail and military attack. Not a word about the far greater part played by the Labour Party in that mess. Of course, such a myth could not survive and flourish in the days of the internet. Or could it?
It has been intriguing to read complaints on the right about the Democrats and their supporters blaming the Republicans for the financial mess, when, they argue, so much of it was the Democrats’ fault what with bad legislation, pressure on banks and refusal to agree on any kind of control of Fannie Mae and Freddie Mac.
Not only have the Democrats been obfuscating their role in creating the current crisis. They are also, I think willfully in the case of the Party leadership, trying to deepen the crisis for the purpose of gaining in the coming elections. Nancy Pelosi’s scuttling of the first bailout bill in the House is the most glaring example of such behavior. The Democrats have a conflict of interest in this matter, and the media are too partisan or too frightened of retaliation to call them on it.
Thank you, Helen.
I second Mrs. Davis.
he explained that they had been convinced of Baldwin’s aim in rearming being to attack the Soviet Union. It sounded like he still thought that many decades later. If a man of his intelligence could believe all these contradictory ideas, what can one expect from an average left-wing academic or analyst
Helen, is it a matter of intelligence or rather the illusions about Russia which managed to confuse & bind so many minds – to deform and limit imaginations? As Jonathan notes, the needs of the party are still put above the needs of the country; we can only hope that this domesticated party is less bloodthirsty than the old red one.
I should also say thanks for this fascinating post.
I re-suggest this piece be considered:
Barack Obama and the Strategy of Manufactured Crisis
In an earlier post, I noted the liberal record of unmitigated legislative disasters, the latest of which is now being played out in the financial markets before our eyes. Before the 1994 Republican takeover, Democrats had sixty years of virtually unbroken power in Congress – with substantial majorities most of the time. Can a group of smart people, studying issue after issue for years on end, with virtually unlimited resources at their command, not come up with a single policy that works? Why are they chronically incapable?
It has been intriguing to read complaints on the right about the Democrats and their supporters blaming the Republicans for the financial mess, when, they argue, so much of it was the Democrats’ fault what with bad legislation, pressure on banks and refusal to agree on any kind of control of Fannie Mae and Freddie Mac. How is it possible to be that cynical and for the populace to be that credulous?
Good question Helen. McCain would be well served if he were able to become something of a teacher to the American people. Not only would he be well served, it would be a tremendous national, even patriotic, service if he were up to the task. It may be a defect in his character (encouraged and developed by his long political career, I suppose) that he is not able clearly see and describe Democrat culpability.
About a year and a half ago Sean Hanity (a U.S. radio talk-show host) brought Mr. Obama’s decades long relationship with his self-described “mentor”, the Rev. Jeremiah Wright. Perhaps a year longer the MSM decided to glance at the afro-centrist and what the relationship implies about Obama).
It seems odd to me that McCain and his advisers can’t utilize this and other info. available about Obama and paint the unpalatable picture of his unsuitability. Maybe McCain + Co. identify too much with Obama; or maybe Obama + Co. have something on McCain although I suspect a dim bulb is more likely.
In any case, a few weeks ago Hanity described the situation in which Obama, as the lead attorney led the legal (Jesse-Jackson like) “extortion” (in conjunction with the Clinton-Reno admin.) of a large Chicago bank. In the mid 90s this forced the institution to make home loans to unqualified borrowers. There are also issues of some years of records that Obama is unwilling to release that need to be examined.
McCain has a chance here to not only vaguely describe Obama as having his fingerprints on the current economic problems but to make him the poster-boy for this problem. A TV ad re-enacting the meeting would devastate the demo. candidate, I think.
Hey,JJ, smart is as smart does. Just got back from a vacation in Europe, and what I picked up from the news was a basic cluelessness as to where this came from. Most of our intelligentsia is worthless but here there are people who do understand; I can’t say that about the sample of talking heads in the media on the other side.
You won’t get me defending our media, Renminbi. In fact, I have stopped paying any attention to them and so have most people I know. We have a long way to go but one day they will be completely discredited. Come to think of it, you guys have a long way to go on that as well.
Ginny, the question of party first is a fascinating one and the related question of Communist infiltration and the harm that has done to Western cultural attitudes (using the word cultural at its widest) is of primary importance. The West has won the Cold War but the long-term charges laid by the enemy are still with us.
Interesting post.
Regarding the current crisis, one group which is quick to attack others…but rarely bothers to assess its *own* performance…is the media. Very, very few articles or TV programs suggested that it might not be possible for housing prices to go up at 10%/year, forever. Even the financial media did not cover itself with glory.
In general, bubbles and silly trends are fueled and exaggerated by the media, which establishes a positive feedback loop (vicious circle) once the trend reaches critical mass.
Leftist are the political representatives of our cultures articulate intellectuals. As such, leftist have extraordinary power to shape the stories we tell ourselves about events. Of course, leftist always write the stories such that the leftist intellectual is always right, always the good guy, even if they served no other role than as Cassandra.
My personal favorite example of this is the common history of Vietnam war, especially in regard to horrific aftermath of the abandonment of Cambodia. The standard story is that the U.S. rightwing engaged in an imperialistic war to prevent to progressive post-colonial aspirations of the people of Indochina and that the American left bravely wrestled the right to the ground and allowed the people of Indochina their self determination. Leftist might aver that they would have preferred a democratic socialism but, hey, any anti-Western socialist state is better than none.
Leftist just kind of blink at you when you mention the 1.5 million Cambodians (1 in 7) murdered by the Khmer Rouge that the American left helped to power or the estimated 165,000+ murdered by the Stalinist Ho Chi Min.
They have their comfortable little fantasy and, protected as they are from the real world consequences of their foolishness by the right, they have no incentive to change.
Helen, thank you for this post. Everything has a precedent, isn’t it?
The real problem, Shannon, is not that out and out lefties believe that narrative or the one about guilty men. So be it, let them believe. The real problem is that in diluted form those beliefs have permeated most people’s mentality, even those who would deny that they are lefties.
But the global financial meltdown we are seeing today is primarily the result of two things:
You may be quite right JJ but I understand that in August of this year the number of balloon mortgages that expanded to contracted higher interest rates reached the maximum monthly total and that seems pretty compelling to me. How long could things have gone on as usual without the unqualified-financing housing breakdown?: indefinitely? It appears to me that the immediate cause was financing in this particular (housing) market. I mean, what other areas were at the forefront, the inception, of the crisis?
It seems you have pointed out lesser, possibly contributing, factors.
Helen,
I agree. This is their power. One does not have to be a leftist to believe in the mythology of the altruistic crusading leftist. We are saturated in this, and other related, mythologies almost since birth.
> they could not have been sold as CDOs without Moody’s giving them the AAA, i.e. risk-free, rating.
And why did they have this? Because Fannie Mae and Freddie Mac were presented as “backed by the US Government” — something inherently suggested by the nature of them as GSOs and overtly by many other organizations. At the very least, the FMs should have said, “No, we aren’t. Cease and Desist this practice, immediately!” to anyone repackaging their investments… but that would have hurt their sales, which would have hurt the golden parachutes of various FM execs, who, it has become clear, were producing fraudulent numbers even in 2004 OFHEO noted these irregularities, raised the alarm, and the Dems in the Congressional Finance, and the Congressional Banking, Committees, instead of calling the FM execs on the carpet, instead went after the regulators.
Lessee — who said the following, in 2004 when the snowball that lead to this catastrophe was just gathering speed:
I, just briefly will say, Mr. Chairman, obviously, like most of us here, this (Fannie Mae) is one of the great success stories of all time.
And this?
I’ll lay my marker down right now, Mr. Chairman. I think Fannie and Freddie need some changes, but I don’t think they need dramatic restructuring in terms of their mission…
And this?
I believe there has been more alarm raised about potential unsafety and unsoundness than, in fact, exists.
And this?
Mr. Chairman, we do not have a crisis at Freddie Mac, and in particular at Fannie Mae, under the outstanding leadership of Mr. Frank Raines. Everything in the 1992 act has worked just fine.
And here’s the piece-de-resistance (emphasis mine):
I do think I do not want the same kind of focus on safety and soundness that we have in OCC [Office of the Comptroller of the Currency] and OTS [Office of Thrift Supervision]. I want to roll the dice a little bit more in this situation towards subsidized housing. . .
These guys — Here‘s some of those statements on video.
“I want to roll the dice” !!?!??!?
This comes down to the entire problem at the heart of all representational government:
“It’s not my money”.
“It’s no skin off my nose!”
Spending comes in four basic relevant forms:
1 – I spend MY money on ME.
2 – I spend MY money on SOMEONE ELSE.
3 – I spend SOMEONE ELSE’s money on ME.
4 – SOMEONE ELSE spends MY money on A THIRD UNRELATED PARTY.
In case 1, I’ve got a vested interest in getting good value for the money. I paid the price for the money and I get the rewards from it.
In case 2, there’s a vested interest. Not as strong, but I paid the price for the money, so I care that it gets spent well
In case 3, there’s a vested interest. Again, not as strong, but I get the rewards, so I’m going to look for good value.
Case 4 is the only lame case with no vested interest at all. It’s not their money, AND they aren’t getting the reward for the decision, either. Their main objective is to get the expenditure over and done with as quickly as possible so they can go back to playing with their Wii.
ALL government expenditures are class 4: Some faceless bureaucrat spending faceless tax-derived money on some defined victim class which they generally could care less about.
The first rule of government is to keep them starved for cash. This government is far too large, and puts its fingers into pies which most clearly at this point are pies they should not be a part of.
It is clear to me that Bush and Greenspan economic policy were not the *immediate* cause of the current collapse. Bush and Greenspan are not the issue, they’re not what we will contemplate in the voting booth. There may have been a certain eventuality of collapse but the point is that *this* collapse can rather easily be laid at the feet of only one presidential candidate and the party he represents.
McCain should hammer at this again and again. There is a very sufficient amount truth in this to make guilt work for him; maybe even enough to move the MSM in this direction.
One unmentioned point here: the Clinton Administration changing the tax law to exempt capital gains ( up to 500k ) from flipping houses from taxation. The only possible reason for this was to buy real estate votes. The more one looks ,the more one realises that the previous administration enabled, or set in motion a lot of bad things. And Bush in his cluelessness was not that much better. We have a Lord of the Flies situation among the political/ chatterati classes of the West.