Many Americans can't remember what they ate for breakfast, let alone pay any attention to history-recent or otherwise. Take our current debate over national economic policy, which is taking place in a historical funhouse where the factual record is constantly distorted. This twisted historical mirror is deluding people into blaming the current administration for a near depression it did not cause, dismissing all the attempts (as underwhelming as some of them are) to confront the crisis, and running back into the hands of conservatives who are promising only more of the same deregulation and tax cuts for the rich that drove the economy off the rails just two years ago.
Americans' historical amnesia is stunning and dangerous. Many people become angry when the Obama administration keeps reminding them that it was the previous occupant of the White House who left the economy in near free fall. Certainly, it is now up to the current President and the Democrats in Congress (constantly battling Republican filibusters in the Senate) to get the economy back on track, but don't blame them for causing the problem in the first place.
A recent poll found that only one in every three people surveyed knows that the infamous bank bailout program (TARP) was passed under the Bush administration; nearly half of those queried gave the wrong answer that Obama had signed the legislation. And virtually no one seems to recall those dark days back in the fall of 2008 when Bush and his Treasury Secretary Henry Paulson first floated the scheme, which provided for shoveling massive amounts of money into banks with absolutely no oversight or review. When Congress balked at the initial proposal, the markets plummeted, and even conservative Republicans felt forced to act. Many of these same reluctant legislators are paying the political price now, condemned by the very voters who two years ago screamed at them to do something, anything, to stop the economy from going over the edge.
If we are to understand what a real economic collapse looks like, we need to examine the Great Depression of the 1930s. But many Americans apparently slept through that subject in their history classes because they have no clue as to what that dark time can still teach us about the necessity for bold government action to pull a nation out of near paralysis.
In fact, today more Americans are pleading for the government to do less, even in the face of stubbornly high unemployment, because they have been misled into fear of the big deficit bogeyman. It is supremely ironic that the current obsession with deficits comes from the same conservatives who first hurtled towards record deficits ten years ago while giving massive tax breaks to the rich and fighting two wars off the books.
The current explosion in red ink is due mostly to those same tax cuts (which generated much speculation and few jobs), the same wars that go on without any clear goals, and spiraling health care costs. The United States certainly needs to control its deficits in the long term through a combination of reining in medical costs, restraining expensive military adventures, and targeting tax increases at speculation, stock churning, and windfall wealth accumulation. But drastic cuts in government spending in the next year or two, under the guise of smaller deficits, lower taxes, and "more freedom," hearken back to Herbert Hoover's failed policies in the teeth of market collapses and bank failures in 1930-32, and FDR's mis-engineered "Roosevelt Recession" of 1937-38.
Again, we ignore these historical precedents at our peril. If we slash federal spending in name of political pandering, we risk riding the economic roller coaster backward into a deeper morass; and the next drop in consumer confidence and spending may be even steeper.
It is true that the size of the current federal debt, on an annual and cumulative basis, seems to be mind boggling. Yet we must not forget still another piece of our history–we paid down another enormous debt after World War II by reinvesting in our people and our productive capacity as a nation. History's lessons are not always easily discerned or easily followed; but we need to keep our basic facts straight, remember what happened both yesterday and years ago, and learn from both the painful mistakes and the courageous achievements of those who have gone before us.
David Zonderman is a Professor of History at North Carolina State University.
