Belmont Club

Going forward

James Howard Kunstler argues that the current Crisis — for want of a better word — has undermined trust and therefore legtimacy in American institutions. It isn’t that people don’t see the problems, it is that they don’t see the solutions.

The tipping point seems to be the Bernie Madoff $50 billion Ponzi scandal, which represents the grossest failure of authority and hence legitimacy in finance to date in as much as Mr. Madoff was a former chairman of the NASDAQ, for godsake. It’s like discovering that Ben Bernanke is running a meth lab inside the Federal Reserve. And out in the heartland, of course, there is the spectacle of Illinois governor Rod Blagojevich trying to desperately dodge a racketeering rap behind an implausible hairdo.

What seems to spook people now is the possibility that everybody in charge of everything is a fraud or a crook. Legitimacy has left the system. Not even the the legions of Obama are immune as his reliance on Wall Street capos Robert Rubin, Tim Geithner, and Larry Summers seem tainted by the same reckless thinking that brought on the fiasco.

I had the same feeling back in September, which motivated me to actually post a screed on YouTube. Kunstler goes further, arguing that losses in legitimacy have historically led to huge changes, when the distrusted Ancien Regime is changed with something else. While I don’t know the situation is as bad as he describes it, here’s what someone the Kunstler site says (thanks to the commenters for the correction):

We have moved beyond the point where swings in confidence in a system implicitly recognize that system as credible. We have moved to a regime of disbelief in the system, and this disbelief is growing by the hour, and there is nothing that can be done to stop its momentum. On some level we have reached a moment of crisis in our identity as a nation not entirely unlike that which we faced in the mid-19th century. We have reached a point where disbelief in the credibility of the current system will become a force that will tear us apart. How we will survive is a matter for the seers. But make no mistake about it: this is no Recession, and there will be no Recovery.

Back in 1971 I was caught up, along with many teenagers, in the doomed effort to save a clearly dying Philippine democracy through a Constitutional Convention. Little did I realize then, that the Convention itself was sentenced to death. There are probably a few dozen people who still remember the hopes that were attached to that footnote in history. The 1971 Convention was held in the fading hulk of the Manila Hotel (before it was rebuilt); then a haunted kind of place eschewed by the smart set in favor of the newer Hilton, the potted plants looking like they were left over from the days of Somerset Maugham.

About a year later Ferdinand Marcos declared Martial Law and arrested a good many of the Constitutional Convention delegates. In retrospect the declining legitimacy of the situation was correctly diagnosed, but maybe we were wrong in thinking that a Convention might solve the problems, though in the long run, not completely. Every rivulet becomes part of the waters. The intervening years were dark ones, pathetic and funny times which are best described elsewhere. But even the separate threads ran together when you followed them long enough; imagine my surprise when, in the dying years of the Marcos regime, I met some of the very same Constitutional Convention delegates in exile in the United States. One I remember, was supporting himself by selling insurance or something. They were all in one form of disrepute each with a kind of shabby gentility which once prominent men wear when they are in the dumps. I remember hearing that the salesman died from a massive stroke one day while at work, and somehow it convinced me that, well, what the hell. I decided to go back and take up the old threads.

Eventually legitimacy was restored. A decade of instability followed the fall of Marcos. But eventually things happened; though it took decades and came through twists and turns which no one at the time could have foreseen. Things which are a long time in breaking are a long time in mending. Kunstler is right to worry; but no one is right to despair. Troubles come to all this world; and we get over them. It just takes some time.

I left the old Army surplus sleeping bag in the same San Francisco basement I had lived in for three months. It may still be there. But before taking the plane back, I invited my host and his wife to watch Local Hero. Then I left to pack my ruck, but not before looking up at the Flag, at whose sight I was moved to tears at the Cambridge Post Office two years before. It flies still for those with eyes to see it.

The theme from Local Hero.

[youtube UMwcGPjYAIk]