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No 'normal' setting exists in today's economy

Thursday, October 9, 2008 | 10:00 a.m. CDT; updated 11:09 a.m. CST, Wednesday, February 11, 2009

"Normal is just a setting on the dryer." Another wise saying from Anonymous. Sometimes we can set the dryer on low, medium or hot, but for that load, it is all "normal."

I asked students how the current economic crash would affect their ability to find jobs after they graduate. Some are planning to receive their diplomas this spring, others in 2010, but most said the same thing: Things are no longer "normal." That is a shame because understanding that "normal" does not exist, and never really existed in the first place, is very important to these caretakers of our future.

NPR's "Marketplace" might have said it best on Oct. 3 when it declared that the economy had good news and bad news. The good news was that the cost of oil had dropped below $89 a barrel. The bad news was everything else. We are now in the new "normal" of economics.

For most of us, the new "normal" economics depends on what we see in our pocketbooks, no matter how misshapen. Jobs, gas costs, mortgages, the security of our retirement plan — if it still exists at all.

Today, we are worried about 6 percent interest rates when 30 years ago, we had double-digit interest for home loans. At one point, 12 percent was "good."

At least no one is throwing themselves out of windows on Wall Street because of the economic crisis. They can't. Under the new "normal," windows on high-rise buildings are sealed shut. Jumping is not an option.

Unless you teach economics or are a high-end financial consultant, what has happened to the American economy over the last three months is beyond confusing. Most of us know what question to ask but are afraid of the answer.

My question is: Will we learn anything from recent "new" economics? I doubt it. We have not learned anything from recent "old" economics. Enron notwithstanding, one of our favorite nemeses of the 2008 economic downfall is American International Group Inc. Ah, how short our memory is of financial mishandling causing — yes, you guessed it — an economic crisis.

It was "way" back in 2003 that AIG — the company that the United States Treasury just loaned $85 billion — was investigated for financial mismanagement, fraud and collusion resulting in a fine of $1.6 billion. Maurice "Hank" Greenberg was forced to leave the company but was not convicted. No conviction means no publicity and forgotten in our short memory.

Will we learn anything from the "old" economics? Today, few remember Black Monday of 1929. My father does, but he was a mere 6 years old at the time. The reality of bread and soup lines has long been forgotten except as oral histories, chapters in textbooks, one-hour series on the History Channel and political ads. Our memory is indeed short.

We have forgotten what it took to pull America and the world out of the Great Depression. We have forgotten that it took a strong leader in Franklin Roosevelt to demand that Congress pass laws creating jobs for lower- and middle- income workers. That the president was willing to put his neck out to defy the "norm" of the day.

OK, Congress has finally passed the $700 bil ... excuse me, the $850 bill ... excuse me, the $1 trill ... excuse me, a $1.6 trillion rescue package. Yet Congress seems to have forgotten the people who hold this nation up by its bootstraps: the lower- and middle-class workers. They are not drinking beer; they are men and women too busy working to support their families, their children and, in some cases, their parents. They need a new savior.

Only a few in Congress saw this package for what it really is: a Mickey Mouse bandage on a failing dam. Few had the guts to say so. We need another FDR — someone who has the courage to put people back to work, to bring jobs back to America, to make us proud again.

Can McCain or Obama do that? Unfortunately, "normal" on their dryer seems to be set to "hot" and their courage is shrinking.

David Rosman is a business and political communications consultant, professional speaker and instructor at Columbia College. He welcomes your comments at ProfDave1011@netscape.net.


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