Downsizing America
I’m not an economist. But in these days of financial upheaval, it behooves us all to pay more attention to what’s going on. As I understand it, the $700 billion plan to bail out the failing financial services industry is intended mainly to keep the credit system from collapsing. Treasury secretary Hank Paulson warns that failure to approve the plan will mean that Wall Street will be unable to back debts, which will cause the loss of credit to thousands of businesses of all sizes and many millions of Americans, resulting in massive job and home losses. One of the problems is that the American economy as it is currently structured runs on credit. Debt is ubiquitous and businesses cannot run simply on what they have in their coffers at any one time. Businesses in today’s economy cannot survive without constantly growing, and they cannot grow without substantial credit. As such, businesses survive day-to-day by running on credit. The loss of easy and convenient credit, backed by the soli