The Real Victims

I've been reading the sad stories of rich people who put all their eggs in the Madoff basket and lost everything. I'm sorry for anyone whose world falls apart but from what I've read most of these folk have family and friends to help deal with the pain of their loss. These are well-connected folk who will get back on their feet soon.

There are other, less fortunate victims in these hard times, who never had money to invest in hedge funds, but who are paying the price for human greed, and are left with no resources at all. One of these unfortunates came to stay with us for a few days last week and her plight has left me heartbroken at the human capacity to inflict pain and suffering on the innocent.

One morning I noticed we had a visitor in the back yard who had taken up residence in the gazebo. Our other cats steered clear of her, which was unusual, Any intruder is usually greeted with curiosity and a few warning growls from the males: "You can stay but follow the rules".

This visiting little homeless cat curled up on the old wool flokati rug I'd thrown on one of the wicker chairs and slept there for hours. Occasionally I would look out and the chair would be empty and I figured I might not see her again. We live in the city, near a crossroads, in a neighborhood with its own share of foreclosures. The free-roaming domestic animal population has always fluctuated. At the end of the school year, when students move on, when summer heat raises temperatures to 115 and above, when renters leave their apartments, when people lose their foreclosed homes, all these factors contribute to the steady parade of lost and abandoned animals that show up regularly here.

Bewildered, these poor creatures seek shelter from the passing traffic and harsh weather. In summer, water is a must, in winter, shelter is sought from the biting cold at night. All animals seek these basic needs. One year, a few days after Easter, as we turned up our street I spotted a little white rabbit nibbling on the strip of grass that lines the sidewalk. She calmly adopted us and became the much loved Bunnygirl. Her habits of eating carpet and chewing through the spines of our record albums and anything else within reach of her razor sharp teeth were all overlooked due to her magisterial temperament. When she gently rested her head on your foot for a nap all was right in her world.

I keep a heat lamp and a small space heater on the gazebo to keep off the night chill. In the morning our guest was still curled up in her chair so I thought I'd get a closer look. I didn't want to upset her as stray cats are very wary. They don't like to check in at the desk, you might say. From a few feet away I could see her looking at me with steady gaze, not fearful, but a bit wary. I left food and water on a nearby table and told her she was welcome to help herself. We left food in another sheltered area for the other cats, so there wouldn't be a contest over resources. It looked like homeless kitty just wanted to rest, and she seemed grateful to be left in peace.

I never saw her actually get in and out of the chair. Sometimes she would be gone, probably for a bathroom break. While refilling her water dish I noticed odd yellow smudges on the rug where she'd been sleeping and an unpleasant,unfamiliar tangy smell. I started to suspect something was wrong but nothing prepared me for what I found the next time I saw her.

She had stretched out on her side near her food, and flies were buzzing about her. The smell I'd noticed before was coming from a wound oozing with pale yellow pus. At first, I didn't know what I was seeing. Bits of bark and dirt were mixed in with the pus. It was the worst injury I'd ever seen. I flashed back on how she had been favoring this side, always sleeping against it to keep it covered, and how painful that must have been. She trusted me to take a closer look. I got q-tips and warm water and tried to clean the wound, constantly brushing away the flies. I thought she might snap at me but she just lay there as I tried to soak up the noxious fluid seeping from her shoulder.

I learned that you can do this, that you can suspend your impulse to vomit, that you block out the horrible smell, that you can hold back your tears, that you can focus on the one thing you have to do, to try to aid a creature in pain. But I could see it was hopeless. The depth of the wound was hidden by matted fur that fused together in ropes. We gently lifted her into a basket and started dialing local vets and animal hospitals until we found one open on Saturday.

The vet who examined her said this was an old injury that had abscessed and on top of that it was likely that homeless kitty had feline leukemia, which is contagious to other unvaccinated cats. A likely scenario was that her former owner had abandoned her, unprepared to deal with this costly heartbreak, financially or emotionally. They might like to know how brave she was, how even in her demolished condition she sought out and found love, that she was cared for until the end, she never lost her dignity, never cried at her loss, but with the great stoicism of cats, she carried on.

Even with much expensive care it was unlikely she would survive as the wound was already totally necrotic, hence the smell. If she hadn't found us she would have died a slow agonizing death, alone and cold. She trusted us to do the right thing for her and I hope we did. With great reluctance we decided to let her go, knowing the vet would help her pass away peacefully.

It seems unlikely to me that she had run away in her condition. There were no "lost cat" signs posted in the neighborhood. Almost all our neighbors have dogs who produce an unending chorus of barks and howls, unlikely places to seek shelter by an injured feline. I suspect she ended up here because she had nowhere else to go. She had a sustained injury that had been neglected for some time, so it's difficult to imagine a caring home. There is no way to know.

There have been many stories in the press of animals abandoned in foreclosed homes. It's wrong and tragic and it makes me feel that there must be a better way to handle this whole situation, because this is starting to feel like we are living in a war zone, with total chaos, and no one wanting to be accountable. These innocent creatures have allowed themselves to become dependent on us, and so they need us to be responsible for them. Their owners need to man up and do the right thing.

It's nice that our leaders are adopting puppies and I won't be cynical and say they are just for photo ops. But if they really want to make a difference, let them adopt one of the animals that have lost the only life they knew due to foreclosure of their family's home. Lead the way by encouraging people to be brave and take their pets to a shelter where at least the poor animals won't be wandering the streets, alone, cold, and vulnerable to predators. The mean streets are no place for pets.

And for those humans who have lost great wealth, stop whining. Show a little dignity. If a poor wounded little cat with no home of her own can do that much, so can you.

All the things that were down...

This summer I read a MySpace post by a teenager here who was struggling to find his own identity while his parents were losing theirs. As I recall, he described how his parents' shrinking income was leading to new household spending rules. At Christmas his father had said not to expect presents. He overheard his mother contemplating divorce. His father always looked grim. The kid got a part-time job at Mickey D's to help the family out. He was hoping he would be able to afford a new video game but thought maybe this wasn't a good time. He was laying these thoughts out to the world on a public space where anyone could comment, but sadly, no one had much to say.

The affluent life of the young in this town was most obvious when you drove past the high school parking lots. The teachers' lots were filled with 10-year old Accords, Dodge minivans, and VWs. Over in the student parking lots the leased BMWs, Lexi, and Escalades lined up one after another in neat rows, glistening under the Arizona sun. In many families the older teens were responsible for picking up their younger siblings after school, or doing the family grocery shopping. It made sense for the older kids to be the family chauffeurs.



The rushed lifestyle of the upwardly mobile created a sort of concierge class among their young. We first noticed this phenomenon in California, when our landlord sent his teenage son over to collect our rent check. The landlord had several ranch houses built in the 70s which had become his property ladder to a Simi Valley mansion. His young adult children all lived at home, providing that essential ingredient to an oversized dwelling, life. When a tenant or maintenance man stopped by the landlord's house, one of the children would always appear at the front door with a friendly greeting.

This became typical in many homes. While Moms and Dads put in long hours at the office their kids took charge at home. Thus it was the children who let in the Merry Maids who cleaned the two-story, 2500-square foot houses, it was the children who unlocked the gates for the gardener and the pool man, who signed for packages delivered by UPS, who filled the fridge with groceries from AJs and Whole Foods, and it was the children who drove the younger kids to soccer practice or the orthodontist. In this way the children acquired a sense of ownership, status, and responsibility from the wealth provided by their parents.

But in many, many of these homes we know now that Mom and Dad were living on borrowed money in order to keep maintaining the illusion of wealth. The middle class hoped that with the appearance of prosperity they and their children would never suffer from a lack of self-confidence, as this is the most highly desired American virtue. "Fake it until you make it" was the much repeated mantra of recent decades. Or as Virgil said long ago, "They are able because they think they are able."

During the years of funny money the middle-class children of Phoenix and Scottsdale were snuggled in their parents' safety nets. For those who have never known a life driven by necessity the nets were taken for granted, part of the fabric of life. This comfortable illusion was not seen as a handicap in a world where competition for basic necessities becomes ever more extreme but rather as an invisible cloak worn against poverty, like something donned by a superhero.

The primary selling point of the suburbs was the suggestion of an untroubled, harmonious world, a safe place to raise children who got out of school several hours before their parents left work. The 'burbs were always more of a dream than a reality. The suburban kids who watched their families' fortunes change because of divorce may be psychologically better prepared for the adjustment in identity that comes when family fortunes fall apart. Children of divorce already know that great sadness can emerge from behind the facade of carefully groomed houses and that chaos can spill out onto silent sunlit streets.



And some lucky kids are born anchored in reality with gifts of humor, empathy, and common sense that will help see them through tough times, no matter what. No less an authority than Dr. Seuss promised that the children can cope:


"Have no fear of this mess,"
Said the Cat in the Hat.
"I always pick up all my playthings
And so...
I will show you a another
Good trick that I know!"

Then we saw him pick up
All the things that were down.
He picked up the cake,
And the rake, and the gown,
And the milk, and the strings,
And the books, and the dish,
And the fan, and the cup,
And the ship, and the fish.
And he put them away.
Then he said, "That is that."
And then he was gone
With a tip of his hat...'

We are all Cat in the Hat now, picking up the things that are down.

The Little Guy

I'm tired of doom and gloom. It's demoralizing. But what are we to make of this (from http://jessescrossroadscafe.blogspot.com/) :

The U.S. government is prepared to lend more than $7.4 trillion on behalf of American taxpayers, or half the value of everything produced in the nation last year, to rescue the financial system since the credit markets seized up 15 months ago. (But there is no money for Social Security, for Medical programs, for real industry, for people - Jesse)

Could someone intentionally trying to bring us to ruin do any worse?

Somehow my ancestors managed to survive Europe's system of serfdom. America was supposed to be something better. But this, this is not feeling better. This is feeling suspiciously similar to being in thrall to the lord of the manor. The little guy is now waking up to this sorry situation.

Armagedepression

My grandmother was Mrs. McScrooge. Like most people who were young during the 1930s Depression she knew every dollar was precious. Deflation does that to people. All my grandparents accumulated nice piles of cash but you would never know it from the way they lived.

A lot of people in the old neighborhood were like that. Many of them were a generation or two at most from immigration. Nothing was ever wasted. There was an old guy in my neighborhood who collected hubcaps that fell off into the street and lay abandoned at the curb. He displayed them on his chain link fence where they caught the sun. It looked cool, like folk art. Do-it-yourself was a form of entertainment. My great-grandmother made floor rugs by cutting old coats and jackets into strips of fabric and braiding them together.

Paul Farrell on Marketwatch lists dozens of reasons why we are rapidly heading toward Armagedepression. Reason 29 jumps out at me: "Social Security, Medicare with $60 trillion in unfunded liabilities". Unfunded? Gee, what's that social security tax you pay every week? Oh, yeah, forgot, Congress borrows against that so the money isn't actually there. (Sound familiar?)

$60 trillion dwarfs all the other debt out there, I believe. Think, if every one over 55 conveniently dropped dead in the next few years, problem solved! Is this financial "crisis" designed to stress us into an early grave? Sometimes I wonder.

This is a good time to rediscover living in the moment. My grandparents' generation lived like that by necessity first, and then by habit. I think I have such clear memories of them because they were so consistent in their lifestyles. Every summer we picked blueberries in my grandmother's backyard, every Christmas we decorated the tree with the handmade ornaments she saved from the previous year, every time we visited in winter she brought out heavy ceramic mugs filled with hot chocolate, and every visit in summer she dished out the same brand of orange sherbet and poured grape juice into the cartoon glasses they gave out free at the gas station.

My grandparents were a consumerist's nightmare. Their certainty in taste sometimes veered into bigotry, I think, and may have been rooted in fear of the new. They travelled outside their comfort zone infrequently, and with the attitude of children visiting the circus freak show. I would have liked them better if they could have moved their center leftward a bit.

But without some sort of center you end up constantly seeking balance. You become vulnerable to flattery and manipulation by con men. The problem, as I see it, isn't with acquisition, or loans, or new things and new ideas, or with wanting more and better. If we face Armagedepression now it is because my generation never found our center over the last 30 years. If we are forced to slow down and reflect, this may not be such a bad thing.

I've been thinking I might even braid a rug like my great-grandmother used to. But the hubcap fence, probably not. Hubcaps today are not what they used to be.

Pinball Wizard Goes Tilt!

In today's news: Nov. 12 (Bloomberg) -- "U.S. Treasury Secretary Henry Paulson plans to use the second half of the $700 billion financial rescue program to help relieve pressures on consumer credit, scrapping an effort to buy devalued mortgage assets.

'Illiquidity in this sector is raising the cost and reducing the availability of car loans, student loans and credit cards,' Paulson said in the text of a speech today in Washington. ' This is creating a heavy burden on the American people and reducing the number of jobs in our economy.' "

Gee, wonder why Paulson got religion all of a sudden? Now that he and his banking buddies filled up at the taxpayer trough he suddenly cares about credit cards, student loans, and car loans? This is going to get interesting.

Last week I noticed a Phoenix 3 bedroom, 2 bath house that was listed for sale at $87K. It's a cute place on a mountainside with great views. Noticed yesterday that it was now listed at $75K. It's a bank-owned foreclosure so I looked it up to see if there was any history on the property. Looks like this place was "bought" in August by Fannie Mae for $105K. I'm guessing the new lower asking price means Fannie Mae is dumping this place as quick as it can. This sudden drop in price, which was mirrored in other properties just in the last few days, indicated something interesting going on behind the scenes.

Then this morning I hear Paulson announce the bailout is no longer for buying "toxic" mortgage assets (as if it ever was). Instead the bailout is now for credit cards. Hmmm, sounds like a whole lot of houses are going to be on the market at freefall prices now that the government is no longer pretending it can set a floor beneath property values.

The government is freaking out because people are no longer buying stuff. People are no longer borrowing to buy stuff. They can't. The entire economy is stalled out. People are losing jobs. I have no idea how the government is planning on getting people to charge up their Visa and Amex cards for Christmas.

On top of this, the banks are now requiring 20% down to buy a home. This means that to get into the $75K house a buyer has to have 15,000 dollars as a down payment, plus assorted closing costs. Most people buying a $75K starter home don't have $20,000 to get into a house.

What I'm also seeing is $45K foreclosure homes showing up in $200K neighborhoods. These cheap homes become comps for the neighborhood. The person who thinks they own a $200K home and goes to sell will discover that no bank will lend a buyer anything close to $200K. The banks will pull up the $45K sale as a comp. If I interpret what Paulson is saying correctly we are going to start seeing foreclosure properties dumped en masse all over the Valley. The spiral down effect on home prices will be devastating, as if things weren't bad enough already.

This also means that Phoenix never really recovered from the S&L crisis which kept prices here stagnant through the 80s and 90s. The drop back towards 1990s residential prices will inevitably effect commercial property, too.

The bailout was sold as a means to salvage the mortgage market. Of course that didn't happen at all. Money was handed to big banks who said thank you and put the money, where else, in the bank.

Still, the fact that the Powers That Be are giving up all pretense is scary. I'm looking at what this does to the Phoenix market but the entire country is hurting as people lose jobs or cut back on spending, afraid they may lose their jobs. Giving up on houses in order to prop up credit card spending sounds desperate to me. Paulson, the financial Pinball Wizard, might as well admit, "Game Over!"

While we were sleeping...

Last week I was so spun up by the impending election I couldn't sleep. By election night I'd accumulated at most 9 hours of sleep over the previous 4 days. While switching channels through the parade of network anchors droning on in front of the electoral map I dozed off for a bit. Suddenly I sat bolt upright as my subconscious mind processed these words: "Barack Obama has won!" I started to cry. I could see Oprah was crying. People in New York City were crying. People in Chicago were crying.

I think a collective sigh of relief was shared by everyone who voted for Barack. What I feel now is that we can't slack back and expect him to do all the heavy lifting. There's too much that needs to be fixed.

During my sleepless hours I've been working on a blog observing how the real estate meltdown impacts my hometown of Phoenix. Until I complete that here's some food for thought regarding the ongoing global financial mess. Ellen Brown's book, The Web of Debt, describes some recent history for our neighbors to the south when they received a "bailout". Though a wealthy country with its own oil reserves Mexico got snared in international currency traps that cost them big-time:

In 1994 when President Ernesto Zedillo suddenly announced a 13 percent devaluation of the peso, the peso eventually dropped by 300 percent – 15 times the predicted fall. What followed sounds familiar (my bold):

The Mexican bailout was engineered by Robert Rubin, who headed the investment bank Goldman Sachs before he became U.S. Treasury Secretary. Goldman Sachs was then heavily invested in short-term dollar-denominated Mexican bonds. The bailout was arranged the very day of Rubin's appointment. Needless to say, the money provided by U.S. taxpayers never made it to Mexico. It went straight into the vaults of Goldman Sachs, Morgan Stanley, and other big American lenders whose risky loans were on the line.

Straight into the vaults? Gosh, that sounds familiar. Huh. Hey, wait a minute! Is that the same Goldman Sachs where Henry Paulson worked until recently?

And now consider what happened next:

The austerity measures that the U.S. government and the IMF forced on Mexicans in the aftermath of last winter's assault on the peso by short-sellers in the foreign exchange markets have been something to behold. Almost overnight, the Mexican people have had to endure dramatic cuts in government spending; a sharp hike in regressive sales taxes; at least one million layoffs (a conservative estimate); a spike in interest rates so pronounced as to render their debts unserviceable (hence El Barzon, a nation-wide movement of small debtors to resist property seizures and to seek a rescheduling of their debts); a collapse in consumer spending on the order of 25 percent by mid-year; and, in brief, a 10.5 percent contraction in overall economic activity during the second quarter, with more of the same sure to follow.

What we experience will soon feel like austerity cuts. I must have remarked a dozen times in recent weeks on the disconnect between prices and value here in central Phoenix. Downtown homes are located close to the city government, public parks, shopping centers, and a new light-rail transportation system. Yet in many cases these houses are selling for pennies on the dollar. Ellen Brown notes: "As in the U.S. depression of the 1930s, the actual value of Mexican businesses and assets did not change during this speculator-induced crisis." Welcome to our newly deflated market and the wondrous effect this will have on government revenues.

Describing the Mexican bailout as the Tequila Trap, Asia Times writer Henry C.K. Liu mentions some now familiar names in an article titled "The Fed and the Strong Dollar Policy":

The ESF (Exchange Stabilization Fund) was the conduit used by the Clinton administration to provide assistance to Mexico to avoid default in the peso crisis of 1994 to prevent huge losses to US lenders after Congress rejected the proposed Mexican Stabilization Act. The crisis was triggered by an abrupt devaluation of the Mexican peso by newly installed president Zedillo to reverse the former Salinas administration’s tight money policy...

Bear Stearns chief economist Wayne Angell, a former Fed governor and advisor to then Senate majority leader Bob Dole, first came up with the idea of using ESF funds to prop up the collapsing Mexican peso. Bear Stearns had significant exposure to peso debts that would cause significant losses in the event of a peso collapse.

Senator Robert Bennett, a freshman Republican from Utah, took Angell’s proposal to the Fed Chairman Alan Greenspan and Treasury Secretary Robert Rubin, both of whom rejected the idea at first, shocked at the blatant circumvention of constitutional procedures that this strategy represented, which would invite certain reprisal from Congress. Congress had implicitly rejected a rescue package in the form of Mexican Stabilization Act earlier that January when the initial proposal of extending Mexico $40 billion in loan guarantees could not get enough favorable votes. Greenspan advised Bennett that the idea would only work if Congressional silence could be guaranteed. Bennett went to Dole and convinced him that the scheme would work if the majority leader would simply block all efforts to bring this use of taxpayers’ money to a vote. It would all happen by executive fiat.

The next step was to persuade Dole’s counterpart in the House, Speaker Newt Gingrich. The two congressional leaders consulted several state governors, notably then Texas governor George W Bush, who enthusiastically endorsed the idea of a bailout to subsidize the border region in his state. Greenspan, who historically opposed bailouts of the private sector for fear of incurring moral hazard, was clearly in a position to stop this one. Instead, he used his considerable independent power and congressional influence to help the process along when key players balked. The controversial 2008 bailout of Bear Stearns by the Fed was not the first.

Looks like practice makes perfect, or maybe not.

Henry C.K. Liu goes on to observe this dangerous trend to the Fed's behavior:

Financial markets are not the real economy but its early dawn shadow. The shape and fidelity of that shadow are affected by the position and intensity of the light source that comes from market sentiments on the future performance of the economy and by the contour of the ground shaped by data on leading economic indicators. Yet the institutional bias of the Fed over past decades has been drifting toward more allegiance to the speculative effects on the financial markets than to the health of the real economy, let alone the net benefit to long-term investors or the welfare of all the people.

The Fed's liquidity joy ride has been to reward speculators rather than investors, and to favor transactions rather than growth. Further, the economy is not homogenous throughout. In reality, some sectors of the economy and segments of the population, through no fault of their own, may not, and often do not, survive the down cycles to enjoy the long-term benefits, and even if they should survive the down turn, they are permanently put in the bottom heap of perpetual depression. Periodically, the Fed has failed to distinguish a healthy growth in the economy from a speculative debt bubble in the financial markets.

It seems if you feel like you've been punked by the Federal Reserve and the banking elite, you're in good company. Misplaced faith that we are uniquely blessed by Providence has led Americans to be complacent as a financial storm built up towering waves on our own shores. We didn't see it coming our way because we didn't think it could happen here.

President Obama will have to deliver the wake-up call that some Americans still won't want to hear. Fortunately it is clear he knows that the young people are already wide awake and listening.

To our conservative friends I would say clinging to the appearance of success isn't going to help us now. But I do see real value, not just in homes, but in our creativity and productivity, struggling to survive beneath the weight of the speculators' economic rubble. We need to rescue that value now before it is suffocated by confusion, indifference, or despair.

Flirting with disaster

In the Old West I would have been a scout. Early life experiences taught me the value of looking ahead for the big picture. You could waste an enormous amount of time doing homework if the next day was a snow day, for example. On a more serious level, I learned that you couldn't rely on authority figures to give you the big picture. When my little brother was sick in the hospital with leukemia my parents forgot to mention he was there because he was dying. An older child might have guessed this but I was only 8. At that age I still thought hospitals made you better. So when he died I was totally unprepared.

From that devastating experience I concluded at a very young age that other people don't always tell you what you need to know. The experience of being surprised by disaster is one to avoid. Navigating the road of life is difficult enough. Being misled just makes it worse. I was still just a child when I learned to treasure the reliable reporter, the truth teller, the authentic personality.

That's why I recommend that friends read Charles Hugh Smith today. He is different from most of the bloggers who writes about the current financial firestorm that is engulfing us. He knows the numbers and the charts but he also knows how to tell the forest from the trees. He gives you the numbers to prove his point but he is able to write in general terms that anyone can understand and appreciate.

Charles Hugh Smith sometimes reminds me of an earlier social commentator, Paul Fussell. Fussell wrote a book in 1983 called Class - A guide through the American status systems. Fussell defined nine levels of American society according to their experience of money. He called out all the usual suspects: the very, very top, like the banking families who own the Federal Reserve, then the millionaires, including trust fund babies, who play the stock market and don't have to work, then rich people who do have to work, like surgeons and lawyers, and on through various degrees of middle and lower class, down to the very bottom of society, the "out of sight", those who live out of a shopping cart.

Fussell thought there was another group composed of artists, writers, musicians, and some professors, creative thinkers who didn't fit into the American caste system. Members of Fussell's Category X live off the financial grid by choice or necessity as much as possible because they aspire to something different than the mainstream. Category X people tend to preserve an independent point of view as observers of society. I suspect Charles Hugh Smith himself fits solidly into Category X.

When I first started reading Smith my reaction was, "Who is this guy living somewhere in Hawaii and how is it that he speaks to the heart of the social matter with such relentless accuracy?" In today's blog post Smith is writing about how our society exploits our need to be seen as individuals by manufacturing aspirations that will ensure our uniqueness, even as we all herd into our club of choice. He suggests that we are all victims of these manufactured aspirations, even many of the Category X types who have become members of the Empty Dreams Tribe:

You might aspire to be an "artist" in which case you are drawn to wearing black clothing and getting tattoos... You discover you have accepted penury within a teeming mass of aspirants, the vast majority of whom work for cruelly low wages in what is essentially a vast, diffused sweatshop for dreamy over-educated types who rejected Corporate America, the Nannie State and even the Black-Clothed Artist tribes.

Manufactured aspirations create a demand for manufactured personas. I first started thinking about the roles we choose to play in a "capitalist" society when I read the psychologist and philosopher Erich Fromm some years ago. Fromm's books critiqued modern society and its ills, a society in which he said the individual had to create a people-pleasing persona in order to "sell" him or herself in the marketplace.

Starting back in the Sixties when I was beginning a long career as "art student" I'd noticed that many successful Category X types created personas of rebellion , ennui, tragic addiction, and so on, while maintaining a sufficient degree of charisma and physical attractiveness to still be "people-pleasing".

Flirting with disaster was the road to great monetary reward for these successful artists and performers. Yet as someone who had actually grown up poor during the years my parents were struggling to pay my brother's doctor bills, I was sceptical. There was nothing glamorous about disaster at all. Disaster easily led to poverty and real, genuine poverty is grim. Flirting with disaster was a dangerous game.

As a kid who scrounged for dry macaroni from the kitchen cupboards because there was nothing else to eat in the house, I never thought playing at poverty held much entertainment. I have met wannabe writers who thought drinking beer from the bottle made them authentic and gritty. Their idea of poverty was rooted in ideas of class, rather than generated from any actual experience.

Somewhere along recent decades, despite the deep-seated American terror of poverty, "poor" equated with "genuine". I think this was a reassuring bed-time story for Americans who were beginning to suspect they were slipping downward off the prosperity ladder. Too many people were accumulating too much debt at too rapid a rate in recent years not to be already experiencing nightmares of system failure.

Smith says there are four main rules that govern our choice of economic roles:

• One key tenet of Manufactured Aspirations is that being poor is a fate worse than death, a shameful failure which you should cloak at all costs with the simulacrum of wealth.
• The second key tenet is that to escape this shame you need only enter the golden gates of the Empire of Debt.
• The third key tenet is that your identity is constructed entirely out of your physical possessions, your appearance and your status within one of the Manufactured Aspirations/Empty Dreams tribes
• ...the fourth and most pernicious tenet: that even as you surrender your identity to a Manufactured Aspiration, you will stoutly believe you are an Individual (capital "I") making a decision in your own self-interest via Free Will

Now examine these tenets in light of Fromm's five basic human psychological needs:

• Relatedness - relationships with others, care, respect, knowledge;
• Transcendence - creativity, develop a loving and interesting life;
• Rootedness - feeling of belonging;
• Sense of Identity - see ourselves as a unique person and part of a social group.
• A frame of orientation - the need to understand the world and our place in it.

Our sense of ourselves is reflected in our culture's fun-house mirror. How easy that makes it to exploit our insecurities! Especially since a lot of our calculations in life are unconscious. Every day we make trade-offs based on what we feel we can afford. What I find fascinating is that at a time in history when we had the best set of tools of any generation in history we made such disastrously bad calculations! My intuitive sense of how this could have happened lies in the vast gulf that exists between the tenets of Manufactured Aspirations as described by Charles Hugh Smith and Fromm's five basic human needs.

Imagine this. Our society was so wealthy we actually thought we could afford to define ourselves by our tastes. I remember both my mother and my mother-in-law treated the New Yorker magazine as the Bible of taste. The ads were the best part of the New Yorker, suggesting a genteel world where delicate tastes were catered to by sublimely discreet servants.

In their later years my parents grew wealthy and spent much money defining themselves by taste. I think it was an idea that we Babyboomers bought into, too, as if wearing bell bottoms and mini skirts meant we were really unique. And Charles Hugh Smith observes that today's "rebels" signify their superior tastes and ecological awareness by driving a Volvo or Prius.

What happened to the country in which driving a classic 1960s VW Bug would signify even more taste and ecological awareness? That would be true,wouldn't it? But the great common status denominator that matters today is how much did you spend. The classic 1960s VW Bug costs $5,000, the Volvo and Prius more like 6 times that amount to purchase. Assuming one buys the Volvo outright and doesn't get an auto loan, in which case, add many thousands of dollars in interest costs. And add maintenance and insurance...you get the picture.

What is rotten is that much of what has gone wrong will now feel very painful and real, yet much of what caused this situation was arbitrary and unreal. We're stuck with the baggage of indulging taste for several decades. Our economic future will feel as if you walked into a Sun City thrift store and seeing all the "treasures" on display, the chrome yellow dinette, the upholstered divan covered in plastic, and the gold cupid lamp with its velvet shade,you were handed a bill and told you will be paying through the nose for these gems for the rest of your life. And your children will, and your grandchildren will. The retro, hip nature of yesterday's taste quickly loses its charms if you are forced to pay for it forever at a cost you can never afford.

I have real doubts as to how this will play out once people figure this out. How will this new servitude remotely make us feel special and unique? Will we become a new version of Amish, embracing frugality and raise our own chickens and vegetables? And since the frugal life takes time where will the time come from? The good news? It's up to us to figure it out. Read Charles Hugh Smith (http://www.oftwominds.com/blog.html) and get some interesting perspective on how we might reinvent ourselves with a little creativity and authenticity.

The Scream Inside

I suspect most people feel a sense of outrage at what is going on. Inside we feel this scream emerging.

But the things that are of value still have value. For too long our sense of self-worth has been measured by our dollar value more than anything else. Hence the feelings of entitlement by some. The people who party with taxpayer bailout money do so because they know they deserve it. I mean, they know it in their bones. They have been getting the big dollars, so they must have big value.

But what about the rest us? The feeling of wealth bought with credit has disappeared as E-Z credit evaporates. No more monster trucks, no more electric toys, no more McMansions built from wallboard and chicken wire. All the stuff that reassured people that they had value is now worthless junk no one can give away.

And people are mad.

Pepe Escobar wrote in the October 17th Asia Times:

But the whole scenario gets more dangerous. As McCain inexorably implodes, an extremely angry Republican party in most of its strands rears its ugly head - the extraordinary levels of hate at recent McCain-Palin rallies are just the tip of the iceberg. This correspondent has seen the mob become really brown-shirt scary, brandishing "Obama bin Lyin" placards or yelling "Kill him!"

I say this is the anger that grows from self-hatred, the most dangerous kind. This is the kind of anger that must look for a scapegoat, must find someone to blame for one's own failings and disappointments.
That never goes anywhere good.

I've been thinking about this because my own anger was making me depressed. Then I started asking why? When did I ever wait for someone to tell me what to think or how to act? I follow my own sense of what's right. I don't let other people set up obstacles in my way. If they knock me down I pick myself up. I think a little whining among friends is okay. But I'm not going to let these arrogant fools define me. My confidence doesn't depend on them.
Time to pick up the pieces and move forward.

Bring on the Clowns

Fall arrived for a few days, took a look around, and left. That's depressing.
Now we're going to have another 95-degree day. No matter what the clowns in charge do, life must go on. One of our cats is bugging me, climbing up the back of my chair and sitting on my shoulder like a parrot.
I feel like this picture when I read the news. Watched the debate last night. Why does JMac keep smirking? It just seemed very rude. If someone did that to me while I was talking, I'd be offended. Obama kept his cool. The Republicans are running around screeching that Obama will put us all on the collective. Right. We are already there.
I hate to be all doom and gloom. But there's a downward spiral to what is happening in the economy. And if you can hand out money to banks then we feel you can hand out money to us, too. The fatuous myth of trickle down economics has been pretty well-revealed by now. We know what's trickling down and it ain't money.
Dave Ramsey was on his radio show claiming the stock market fell yesterday because Obama is going to raise taxes. Uh, Dave, the stock market fell because the bailout isn't working. You know, the bailout where our government "guarantees" every bank in the world?
There's this little thing called a credit crunch, Dave. We gave the banks a whole lot of taxpayer dollars so they would loan money so imported stuff won't sit on docks and people won't get laid off when companies can't make payroll. Only the banks decided to keep the money. They aren't loaning it out. So the credit crunch continues. Ha, ha, joke's on us. I'm missing the part where Obama has anything to do with this, Dave.
Well, have to get going. The cat says feed me. Cats get it.

The Big Picture

Being an artist type I like to look for the big picture. Here's one for you. The government is taxing our money and then loaning it back to us with interest. That's my take on all this. Sounds like a joke. Well, it is, sort of. A joke at our expense. Are we laughing yet?

I had an intuitive picture recently, from something you see here in the summer. A pond or river dries up. All the little critters that live in the water find themselves sucking mud.
The mud turns to dirt and the critters have nowhere to go. That's what I see happening in the near future. Sounds like deflation, doesn't it? The Dustbowl during the Great Depression is a very powerful archetype that sticks in one's mind during times like these.

Here's another archetypal picture, the little piggy sitting down to eat. I love the expressions in this illustration. And what exactly is Mama Piggy serving? Is this a scene of porcine cannibalism? Notice the look on the face of the piggy at the window. I can't tell if he is disgusted or thinking why wasn't I invited to the meal? "What am I? Chopped liver?" Probably! I think Mama Pig is the government and Son Pig is like the banks. And who is that at the window? That must be the taxpayer!

I find that looking at these old pictures always cheers me up. They seem very wise to me. So now, yes, I am laughing.
Such is life.

No Country for Babies

It was during the Carter years that I first experienced how the economy can make you feel like
you're living in a horror movie.

A Time magazine story from March of 1980 reported: "Inflation and interest rates, both topping 18%, are so far beyond anything that Americans have experienced in peacetime —and so far beyond anything that U.S. financial markets are set up to handle —as to inspire a contagion of fear."

March of 1980 was the same month I learned I was pregnant with my one and only. My husband and I both had good jobs, he as an engineer, me as a tech artist. Yet it seemed as if we were continually log-rolling financially. I was worried if we could afford this baby and at the same time I heard the clock ticking. My intuition had recently given me the green light and now I was constantly throwing up with the worst morning sickness ever.

Nothing like bringing a life into the world to make you start paying attention to the people who make decisions for you. I listened closely when Carter addressed the inflation mess. He said it could be traced largely to "our failure in Government, as individuals and as a society to live within our means."

I remember this line to this day. Like many other people back then I resented the implication that we personally had been living high on the hog during his regime. That wasn't my world. It seemed to me all we did was work and go to school. On the weekends we occasionally went to a club and had a beer while listening to live jazz. Mostly we hung out with friends. No one I knew was living beyond their means. We didn't travel, didn't drive flash cars, didn't own a home, didn't buy expensive toys.

Here we are almost 30 years later and same baloney, different package. It depresses me no end to see that our children will have to go through another financial mess that could have been avoided. As Carter himself said back in 1980:
"Nothing will work until the Federal Government has demonstrated that it can discipline its own spending and its own borrowing."

Yeah, tell it to the judge.

Every day I read many of the blogs that discuss our current economic and financial woes. The take-away message I get from these is that our country has been playing the "fake it to make it" game during most of my adult life. I find myself wondering if this latest "crisis" isn't just the same old crisis that never went away. I feel paranoid enough to wonder if this latest "meltdown" isn't designed to drive us Babyboomers sick with worry and stress and then peace out into an early grave. Don't have to pay Social Security to dead people.

How is that any less crazy to believe than that over thirty years our best and
brightest leaders have handed us nothing but a giant, steaming cow patty financial-wise?
That they created strange housing loans designed to fail and handed them out like candy the last couple of years? That they took hard-earned capital and spun that out like cotton candy into trillions of dollars of "derivatives" so large no one even knows how large they are?

Here's what I think is the biggest problem facing us: the basic social platform upon which one raises a family has become rotten to the core. Which is why I think Demographics are going to bite us in the long run. The primary reason governments encourage immigration, legal, or otherwise, is to keep the population numbers up. The credit crunch everyone is screeching about in DC isn't going to matter if the young keep believing this is no country for babies.

It's no accident that McCain picked a fertile Mrytle for his running mate. She may be ditsy but she popped out a bunch of cute rugrats. Large families are great if you can afford them. I suspect that on the Far Right there is a belief that Americans should have large families out of patriotic duty. Never mind that they can't afford them. The Waltons turned out okay, didn't they? Six kids sharing a room is homey when seen through a Kindcaid-painted blur of nostalgia.

The truth is more and more Americans are having one child or no child or putting off having a child until they have to rent-a-womb. All the talk about money in the abstract distracts us from the fact that our numbers are melting away like ice cream dropped on the sidewalk in July.

Are we going to keep letting the quality of our lives be manipulated by bankers and politicians and advertisers who are only interested in the immediate gain? I'm so tired of living under one crisis regime after another. Tired of wondering what stupid crap The Man is calling dinner tonight. Tired of financial log-rolling where no matter how fast you spin your feet you are always one step away from falling in the river. Tired of feeling that we are not building any kind of future at all. Before dancing off with the Grim Reaper someday I'd like to see a hope of a future for the kids. Is that too much to ask?

KC's Degringalade

This French word "degringolade" means a quick deterioration, things suddenly falling apart...So I appropriated it for myself as "degringalade", a little pun on gringa , that's me.

Are things really falling suddenly apart? I get that feeling often now. How often have we seen our fearless leader's latest inf0-mercial? It seems like every few days in recent weeks. After 8 years of no contact this feels like a relative who suddenly asks you to wire money. These days I feel a migraine approaching when I hear the President is going to give the nation a little pep talk.
I don't feel reassured at all, if anything, it has the opposite effect.

And living in Phoenix adds to my general sense of disruption. After the S&L crisis, suddenly, following years of stagnant growth, there was real appreciation in home values here. Finally. Many of us who lived here for the last several decades thought the rise in property values was long overdue. Compared to neighboring California Phoenix was still dirt cheap.

Then, just as suddenly, the gains vanished. Homes in my downtown 'hood were selling in the 400s to 450s in 2005 and in 2008 started dropping to 300 and sinking lower. These are really nice dwellings, older homes with character, many with tree-lined streets, large yards, and located near the Capitol.

While the downtown had started to experience some resurgence

the housing developers found more profit in creating little Potemkin villages on the outskirts of Phoenix metropolitan, turning the desert into Shangri-La for working families. For many the city was seen as a risky place to live. A woman in Scottsdale once said to me when I told her I lived downtown, "Oh, yes, all those artsy types!", spitting the words with utter contempt. The conventional wisdom believed the far Valley was a safe choice to buy.

If you've lived here long enough you know the desert quickly consumes any dwelling that is neglected for more than a week. Dust covers every surface, creosote supplants century plants and mesquite trees in no time, after a monsoon storm jagged cracks appear in the surface stucco, and when the earth sighs, the freshly laid concrete foundations of new homes begin to tear apart. Degringolade, indeed.

The new homes were built quickly and many communities appeared overnight.
The people who bought these structures soon began to complain of shoddy construction. In some towns developers promised to build schools that never materialized.

Today if you drive around far Queen Creek or Florence you can find almost new two-story homes that are now for sale in the low 70s and which sold a few years ago for 3 0r 4 times that much. I thought, perhaps we should look at these "bargains", might be good for retirement someday. So we drove out to the far East Valley one Saturday morning. And drove. And drove. What were people thinking I wondered? Who would ever want this kind of commute? It cost us $30 in gas and that was just one round-trip.

The houses we saw were very typical, two-story, stucco, stacked very close to each other, five feet to the property line in most cases. That's too close. You will hear every argument, every TV as if it were in your own living room. Many people were using their garages as porches sheltered from the withering sun. As a result cars were parked half on the streets, half on the sidewalks. Children darted out into the street, where they preferred to play rather than in the pocket park that lay at the far end of the development.

An evacuated wasp nest, the kind you find fallen to the ground in autumn, has a homier feeling than these places. Empty wasp nests have served a purpose and do not reek of despair. My take on these developments is that they depend on strict enforcement of home owners covenants to keep up appearances. If cars are kept parked in the driveway it is less obvious that the streets are too narrow. If weeds are kept under control and the fake lakes kept filled it is less obvious that they occupy the relentless desert.

I'd like to see Phoenix create a strong core in the central city. I'd like to see people live closer to where they work. A long commute is brutal here, even when gas costs aren't skyrocketing. Huge SUVs and truck are popular in Phoenix because the big engines provide better air conditioning. Sitting in traffic at rush hour when it is 117 degrees takes a toll.

The biggest mistake people make when moving to Phoenix is thinking they are somewhere else.
The earlier generation of developers thought they could mold Phoenix into an image of Iowa. The latest model was Southern California. Neither fits the reality of this climate or ecology.

It's become pretty clear that we can't let the leaders mind the store while we live our lives. I'm worried that the bailout is "grab and go" money for the elite. Some days it feels like the rest of us are locked in the hold
of the Titanic. I doubt things are really that bad but the rude awakening is real: the people at the top want their profit today and don't care about our tomorrow.