According to WikiAnswers:
Banana republic is often used to imply gross inefficiency, corruption, and powerlessness, as well as oppression (government sponsored death squads).
Sounds increasingly like America, doesn't it? We don't seem to have the death squads yet, or if we do, they're operating overseas at black sites. The rest is a pretty good match.
As Republican campaigns around the country crash, burn, withdraw, and shatter, we all get a first hand look at the end result of 30 years of Reaganomics[1] and increasingly unfettered[4] "free-market"[2] capitalism[3]:
[1] The root of the problem can be traced back to the deregulation era that began during the Reagan administration. What George H.W. Bush once called "voodoo economics" fast became the biggest redistribution of wealth since the New Deal. The central article of faith in the "Reagan Revolution" was that money rerouted from the poor to the rich would produce a burst of productivity and economic growth. Give to the corporations and the wealthy, said the "supply side" economists, and they will invest the money in new factories, research and technology, and the country will be restored to greatness.
Did the theory work? Hardly. Rather than putting their money into jobs, research or equipment, the country’s biggest businesses went on the largest merger binge in history, buying up smaller companies in a trend that spelled less competition, less productivity, and more control of the economy in fewer hands. Multi-billion dollar corporate war chests were assembled to finance takeovers of large oil and coal companies, communications giants, and prestigious financial institutions.
[2] The financial meltdown on Wall Street is more than a cyclic correction brought on by a mismanaged business cycle. It is emblematic of a problem at the very foundation of the right wing economic philosophy that became conventional wisdom during the Bush years -- and would be continued in a McCain presidency.
The zealots of unfettered "free markets" cast aside the critical lesson that the world learned during the Great Depression: left to their own devices, unregulated financial markets do not necessarily function to benefit the society as a whole -- or, in the end, even many individual market participants.
[3] John McCain, the reborn populist, wants to divert your attention from the architects of our economic crisis: the Republican Party and its free market ideologues. It is an unconvincing posture, based on a distorted reading of American history.
Today's financial crisis is the predictable historical outcome of the policies enacted by the Republican Party since Ronald Reagan's presidency. The market fundamentalism dictating Republican policy has become so pervasive that most Americans are unaware of how we got here and how it could have been avoided.
[4] Many events in Washington, on Wall Street and elsewhere around the country have led to what has been called the most serious financial crisis since the 1930s. But decisions made at a brief meeting on April 28, 2004, explain why the problems could spin out of control. The agency’s failure to follow through on those decisions also explains why Washington regulators did not see what was coming.
On that bright spring afternoon, the five members of the Securities and Exchange Commission met in a basement hearing room to consider an urgent plea by the big investment banks.
They wanted an exemption for their brokerage units from an old regulation that limited the amount of debt they could take on. The exemption would unshackle billions of dollars held in reserve as a cushion against losses on their investments. Those funds could then flow up to the parent company, enabling it to invest in the fast-growing but opaque world of mortgage-backed securities; credit derivatives, a form of insurance for bond holders; and other exotic instruments.
The five investment banks led the charge, including Goldman Sachs, which was headed by Henry M. Paulson Jr. Two years later, he left to become Treasury secretary.
On top of all the joy coming out of
A survey of hiring managers by the Society for Human Resource Management, a professional association in Alexandria, Va., showed hiring expectations for October at their lowest in four years.* Update 20081004 4:30pm: That's 750,000 jobs lost, when we need to add 150,000 jobs per month (1,350,000 over 9 months) to keep up with population growth. So we're actually short about 2,100,000 jobs over the last 9 months. That's what unbridled capitalism does for you.
"The US economy is shrinking, and there will be many more awful [Labor Department] reports like this," said Ian Shepherdson, chief US economist at High Frequency Economics, Ltd. of Valhalla, N.Y., in a note to clients. "Payrolls were weak everywhere."
Unemployment including discouraged workers (those no longer looking for work) hit 11%. 9.5 million Americans are actively looking for work. 6.1 million workers are in part-time jobs because they cannot find full-time jobs. 1.6 million workers are not counted in the standard unemployment figures because they haven't looked for work in the last month. More than 5% of the workforce (7.7 million workers) are holding down multiple jobs. The average workweek has fallen to a bit under 34 hours.
In the "duh" news, we're approaching a recession:
"Anyone who's wondering if there's a recession should stop wondering," said Nigel Gault, U.S. economist for Global Insight, which will release its updated forecast on Monday. "The recent data were deteriorating sharply" even before factoring in the latest impact of the credit squeeze.
Global Insight doesn't think the recovery will be quick or powerful. The economy will likely contract for three quarters and then show weak growth in the second quarter next year.
If the recession lasts from December 2007 until April 2009, as Gault suspects it will, it would be the longest since the Great Depression. And the recovery, when it comes, won't feel anything like a boom.
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