Approaching a Great American Crossroads in the Current Financial Crisis

The nation appears to be fast approaching a crossroads in the current financial crisis. While the 2012 election is nearly a year away, the political and economic situation appears to be quietly and gradually getting more precarious. As the country comes to grips with a volatile stock market, "new normal" economic statistics, a dismal societal malaise, protests on Wall Street, and a politically hostile environment, one has to wonder in what direction the country is headed. Whichever way we are going, you might want to fasten your safety belt.

Ongoing Symptoms of Stagnation: Unemployment and the Housing Market

Associated Press' Christopher Rugaber reported today that applications for unemployment aid fell slightly last week. Rugaber: "Applications ticked down by 1,000 to a seasonally adjusted 404,000." Where the report suggests that layoffs have declined in recent weeks, other data shows that employers have not increased hiring.

Commenting on the report, Nomura Securities' senior economist Ellen Zentner said that the current unemployment aid applications number reflects a neutral job market, "One that's neither picking up, nor deteriorating". Such a comment reminds me of the saying, "If you're not growing, you're dying." Where companies may be reluctant in hiring, the US economy is simply not producing sufficient jobs to keep up with population growth let alone decrease the unemployment rate.

Regarding the struggling housing market, msnbc.com reported today that foreclosures are increasing as banks are aggressively moving in against borrowers who have fallen behind on their mortgage payments. According to msnbc.com, "the surge in default notices means homeowners who haven't kept up their mortgage payments could now end up on the foreclosure path sooner". The article suggests that because minority and low-income communities were targeted for subprime mortgages, foreclosures have been more severe in those communities.

These dismal economic statistics only add more fuel to the fire in the hearts of Americans looking for solid, lasting, and positive change.

Political Dynamics

While US economy has been stagnant, evolving political dynamics are adding new dimensions to the country's problems. While the Occupy Wall Street protests have garnered both support and criticism, some commentators are equating Occupy Wall Street as the left-wing version of the Tea Party.

Whereas equating Occupy Wall Street with the Tea Party may be more or less inaccurate and unfair to both sides, the Occupy Wall Street movement appears to be gaining strength while the country deals from this dark economic cloud over its head. Even so, an apparent lack of united direction and firm, realistic demands in the Occupy Wall Street movement is leaving many conservative commentators and politicians shaking their heads.

While Republicans contend with each other to decide who will run against Pres. Obama in the next presidential election, contemporary ideological differences in American society and the disconnect between the right and the left should raise questions of the country's political future. In what direction is the nation going to go after the 2012 election? How will the results of the 2012 election affect the economy?

Even with the prospect of the 2012 election, is there hope that the political gridlock will go away? Even after 2012, it would appear that the nation is going to have to make some tough decisions on key issues like immigration, Social Security, higher education, unemployment, and health care. When all is said and done, American society is going to have to come face-to-face with the harsh economic realities of these issues.

What Will Be the Evolution and Implications of Occupy Wall Street?

Of course, a full analysis of the evolution and implications of today's issues could not be completely explored in one article. Nevertheless, given the gravity & sensitivity of the nation's primary socio-economic issues going forward, the answers to any political or economic questions today may only create more questions in the future.

Occupy Wall Street has become a feasible symbol of the deep socio-economic, cultural, and political divides in the country. Where Occupy Wall Street should be commended for getting its interests to the forefront of today's political dialogue, the movement's lack of firm policy goals is highly suspect. One has to wonder into what the Occupy Wall Street movement will evolve. Could Occupy Wall Street genuinely be the left's response to the Tea Party, or will the protests evolve into something completely different? What will the endgame of Occupy Wall Street look like: legislative policy changes or London riots?

Various media sources have reported on Occupy Wall Street phenomena from Democratic support of Occupy Wall Street to Republican criticism of the protests to an Occupy Los Angeles protester's claim that violence may be necessary for the movement's goals to even the rants of an anti-Semitic protester. What these various stories should demonstrate is that the aims and goals of Occupy Wall Street are diverse, malleable, and most importantly uncertain. In short, Occupy Wall Street is an uncertain political movement in an uncertain political environment dealing with an uncertain economy.  

Sheer Uncertainty

Our situation is one of sheer uncertainty. Part of the problem is that the uncertainty is spread among an array of significant political and economic issues. Where a lack of government cohesion has intensified these political and economic issues, a growing lack of societal cohesion (brought about by ongoing uncertainty) could severely complicate already divisive issues.

Given this grave uncertainty and the dark clouds of societal malaise, we have yet to see how the current system will evolve. It is often said that "money talks" and most likely, money is going to have the last word on many of our nation's current economic and political issues. Despite the hearts of those protesting across the nation, there is reason to believe that ultimately the market will have the last say with respect to our current political & economic issues. For instance, with the topic of Obamacare, if it becomes clear that instituting mandatory health care is financially unfeasible for the US government, the plan may be abandoned de facto if not de jure. Obamacare could very well be dismantled by states and in the markets before it is possibly defeated in the courts.

Hopefully, we will have a better sense of certainty in politics and economics after the 2012 election -- even then, I'm not going to hold my breath. Even at a crossroads, there comes a point in time when the rubber has to meet the road. And in particular, on divisive topics like Obamacare, immigration, higher education, and Social Security, it remains uncertain whether our political process will be able to sufficiently resolve these issues. What will happen if states simply choose to ignore Obamacare? What will happen when an entire generation of students graduates with no hope of securing a job? Phenomena like Occupy Wall Street and the Tea Party may help people have their say, but creating and instituting policy is the ultimately job of the government.

As for this crossroads at which the nation finds itself, where many would like to be headed in one direction or another in the near future, we may very well have to hurry up and wait. With political gridlock in Washington and the 2012 election on the horizon, the pragmatic solution for right now might be simply that Americans have to find peace in the fact that we are not going to be going anywhere (if at all) until after the 2012 election.

A sore resolution to the current crossroads would be if political gridlock continues even after the 2012 election. (If we become certain that the political/economic situation is going to be uncertain, would we then be in a situation of certainty or uncertainty?) Even if that scenario is the case, it is still important that we recognize that we are currently at a crossroads. At least then we know that the country will be heading in one direction or another at some point. And even if we are stuck in a crossroads, then you may still want to fasten your safety belt. As in a van full of people, even if the van is out of gas stuck with a flat tire by the side of the road, it's still good to have your safety belt fastened -- you don't know if a car or truck could come out of nowhere, not see the van, and crash into you.

We may have to just get comfortable in being uncomfortable. While the US government and the Federal Reserve appear to be running out of options to redeem the situation, after a while the only possible solution left may very well be time. As unsatisfactory of a solution as time may be right now, with hope for change time will heal all wounds.