How America Lost the American Dream

I'm no economist. I'm not even that familiar with all the inner workings of a bank, let alone a national economy. But it doesn't take a veteran Wall Street analyst to say we're in trouble. Last night President Bush formally announced his bailout plan for the American economy, although it's been whispered of in the paper for nearly a week now. Not only that, but this is going to be the biggest bailout in US history. This has never occured before...not during the Great Depression or before, and certainly not since. The fact is this: the US economy is on hard times. So hard, in fact, that the government is being forced to take drastic measures to save it. But that's not anything new. Here's another fact: the rest of the world isn't much better.

I'm not proposing a different sort of bailout plan or whatever, but I am going to pinpoint the problem. American spending. Since it's founding in 1776, America has amassed a national debt of roughly $7 trillion. Most of it has been since the second World War. Here's a fun fact: at the rate our government is spending, $1 billion is spent every 8 hours and 20 minutes. That's roughly $3 billion a day. Now multiply that number by 365 and tell me you're not astounded.

An even larger problem, is t he American public at large doesn't attempt to reduce spending either. Credit cards, loans, mortgages...sound familiar? Americans simply love credit. It's vital to our culture. It is absolutely necessary if we wish to maintain our current lifestyles, completely inconsistent with our income. But now the housing market is going south. Now the dollar is worthless overseas. It used to not be this bad, but I was recently in the UK. The US dollar is barely half of the UK pound. And the Euro is worth about 50% more than the US dollar. But here's the crazy part. We think we have it so bad, but they've always had a higher cost of living. Especially gasoline. A glance at a European gas station sign and you'd think they're the same, but don't forget, they sell in Litres over there. Thus a sign in Europe advertising petrol for 4.25 would basically be $8.50 per gallon. But that's nothing new. They've had it worse than we have. The difference? They're not a credit-happy nation. Sure they have credit cards; who doesn't? But they don't use them like they're going out of style. They don't overextend themselves on loans that they can only pay by counting their pennies and working overtime on the weekends.

Another sad example of American spending vs. our European counterparts is fuel consumption. Care to guess the average fuel economy of an American car? It's about 25. A European car? About 45. And they don't drive nearly as much as Americans do anyway. Buses, metros, taxis, and cross-country railways are the norm over there. In the US we have a hernia if we have to ride the public transportation system.

It's sad but true, in my opinion. The fall of the American economy is a self-created destruction. We did this to ourselves. Whoever talked big about the American dream and saying it was available for all was certainly right, but did they mention at what cost? Apparently not. Well, here it is. A $700 billion bailout. Will it work? Maybe for a few months. If you recall after the Wall Street crash at the beginning of the Depression, there was also a bailout. Stocks rebounded and spirits were high...then it dropped again and didn't stop.

So no. I don't think the bailout will work. It will make people shut up for a while. Maybe even for a year. But the fact that this very economy is based so heavily on credit and money it doesn't even have is going to be it's downfall.

This is how America lost the American dream. Unfortunately, I think the American dream is also how America lost itself.