Robert Scheer: It wasn't David Stockman Who Wrecked the Economy!

Why is David Stockman driving everyone crazy? The shoot the messenger frenzy, that has greeted Sunday's New York Times, op ed by Ronald Reagan's former budget director, leaves one searching for the message that has unhinged his critics. I borrowed that word unhinged, from more than one of Stockman's critics, upset over his rant, bemoaning the loss of the gold standard, and the statist economics practiced by just about every American president, from Franklin Roosevelt, through Ronald Reagan on to the current inhabitant of the White House. The only exception was a few golden years of fiscal responsibility under Dwight Eisenhower, who, like Stockman, was possessed of prudent Midwestern economic values. Stockman remains some kind of naive libertarian, actually convinced that a free market ought ti o be free of control by the financial cartels, and the cronies they purchase in government. What's all the outrage about? What's wrong with putting the great Wall Street banks out in the cold, to compete as at risk free enterprises, without access to cheap Fed loans or deposit insurance? That's the same cold world in which the rest of us live. The headline on Stockman's piece, State Wrecked: The Corruption of Capitalism in America is unquestionably accurate. Actually, the title of his just released book, The Great Deformation: The Corruption of Capitalism in America, is a bit softer, but you get the point. What his critics find so disturbing, is not a quant argument about the purity of monetary policy, but rather the bold assertion, that the overall American system of crony capitalism is in fact wrecked. This is a contention that most Americans might readily agree with, in terms of their daily experience, but one that the hardly suffering pundit class would rather not contemplate. For all the strident attacks on Stockman's column, I have yet to read a serious critique of his most brazen claim, that the bailouts and quantitative easing, that have saved Wall Street, and brought the stock market back to historic heights, represent class warfare, with the vast majority of Americans on the losing side: Since the S&P 500 first reached its current level, in March 2000, the mad money printers at the Federal Reserve have expanded their balance sheet sixfold to $3.2 trillion from $500 billion. Yet during that stretch, economic output has grown by an average of 1.7 percent a year, the slowest since the Civil War, real business investment has crawled forward, at only 0.8 percent per year, and the payroll job count has crept up at a negligible 0.1percent annually. Real median family income growth has dropped 8 percent, and the number of full time middle class jobs, 6 percent.