My father, George, had a favorite saying. Whenever he (or I) learned something the hard way he would always say, “Too old too soon, too smart too late”. Those words used to irritate me to no end when I was a teenager but now when I think about them they make a lot more sense than they used to. In Spanish one might say “El hombre se hace viejo muy pronto y sabio demasiado tarde”. Now that I am as old as my father used to be I am starting to have more and more of those "déjà vu" moments...you know what I mean,...the experience of feeling certain that one has already experienced in the past something that is happening right now. The other day I started thinking, "Hey, wait a minute! What happened in the past when the economy took a dive?". The memory of several such events came back to haunt me. The government inflated the money to pay the debts with cheaper dollars and everything went up in price except the wages of the working poor and the lower middle class. That's why many of the moms had no choice but to enter the workplace instead of staying home to care for their small children.
My first experience with the cheapening of money was in the late sixties. In 1965 the government decided to remove the silver content from coins. Prior to 1965 the coins were minted with about 90 percent silver content and by 1970 just about all of the silver had been removed. For many years the price of silver was about 37¢ an ounce, which meant that the face value of each coin was far in excess of the silver content. It wasn't until the early 1960s that the value of silver began to escalate to the point where it came close to the face value of the coins. The critical turning point was $1.29 per ounce where the melt value, and the face value became equal. About 1970 a little old man where I worked would meet us every day at the gate to the plant just before the start of the shift. His name was Sidney Schindel. He was thin and bald and stooped over and he had a serial number tattooed on his forearm that he received at Auschwitz prison during World War II. He would say, "Show me your coins, boys, show me your coins" and he would insist that he give us a shiny new coin for each of our old ones. We thought he was crazy. Yeah...right! Later on when the price of silver skyrocketed we all felt stupid and it was old Sidney who had the last laugh.
My next experience with governmental sleight of hand was with "Nixon Shock" when President Richard Nixon took the U.S. off of the gold standard without consulting with his international counter parts. He was desperate to halt the flow of gold out of the country because the rest of the world was losing confidence in the dollar on account of the amount of spending for the Vietnam war and Lyndon Johnson's social programs. On August 15, 1971, President Nixon closed the "gold window”, and ended convertibility between US dollars and gold and by doing so he helped to unleash the inflation of the 1970's. The U.S. started printing more money, the rate of inflation rose, and debts were repaid with cheaper dollars. This triggered a reaction that led among other things to the Arab Oil Embargo and long lines at the gas pump. On October 8, 1974, in a speech entitled "Whip Inflation Now", President Gerald Ford announced a series of proposals for public and private steps intended to directly affect supply and demand in order to bring inflation under control. The "WIN" button was created to remind everyone to "Whip Inflation Now" and President Ford became the butt of many jokes.
In 1979 there was another oil crisis in the United States while Jimmy Carter was president that occurred in the wake of the Iranian Revolution when oil production was interrupted. The price of crude oil began to rise dramatically and with the rise in the price of oil the cost of everything produced from oil or related to oil rose with it. Again, just as before, all debts were paid off with cheaper money. Jimmy Carter abandoned the "WIN" button and took measures to lower dependence on foreign oil and to try and balance the budget but things didn't really settle down again until the "good old days" under Bill Clinton and the budget surplus. Now, with the latest economic crisis stemming in part from some poor decisions made during the the administration of George Bush we are facing another temptation to "print" our way out of the problem by dramatically increasing the supply of dollars. The economists say that inflation is under control but that is what they always say because a run on the banks would just make things worse.
During his recent State of the Union address President Obama coined the slogan "Win The Future". Immediately I remembered "Whip Inflation Now" and the ghost of Sidney Schindel whispered in my ear "Show me the coins". It was Sarah Palin, I think, who turned Obama's "Win the Future" into the acronym "WTF" although it seemed to me like she had another meaning in mind. Perhaps it was "Way To Fail" or "Why The Failure", or "What's This For?", or "We The Fools" or even more apropos for Sara Palin, "What The Fruitcake?". The gist of it is that the liberals want to print more money and the conservatives want to leave everything to the "invisible hand in the marketplace" to sort things out. On January 20th the best-selling author Philip Pullman gave an inspirational speech in which he called the market fundamentalism of the invisible hand, the "greedy ghost", and said that it must go because profit is all that it understands and it does not recognize quality of human life.
The term "invisible hand of the marketplace" first appeared in "The Theory of Moral Sentiments" which was written by Adam Smith in 1759. The thing that most people either forget or don't know is that Smith was a religious man and he thought that profit along with compassion, good morals, and judgment were all part of God's eternal plan for the advancement of mankind. These days profit alone reigns as king while compassion, good morals, and judgment have been left begging. I was mulling all this over during the Super Bowl game, that epitome of market fundamentalism, when the answer came to me during the energetic half-tine show by the "Black Eyed Peas". They were singing "Where's the Love?". That's it! Where is the love that is missing from market fundamentalism, or the invisible hand, or the greedy ghost? In order to "WIN", and "WTF" we must add "WTL". Mr. President...I hope that you find the love before the next State of the Union and do something for all of those families whose breadwinners are out of work. The whole world is watching and depending on it. In the meantine, Mr. President, I will keep praying for you and believind that you are working in the best interests of the American people, and people everywhere.
WTL = Where's The Love?
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