Fear Itself

[NOTE: My Comment Policy appears at the end of this post.]

One of the most famous remarks of any American leader was FDR’s. “[T]he only thing we have to fear,” he said, “is fear itself.”

The remark came early in his first inaugural address, on March 4, 1933, in the depths of the Great Depression. FDR wanted it and the speech that followed to give people hope that better days lay ahead, without denying the bitter times they already had endured. Our leaders today face the same dilemma: inspiring hope without denying the hard times that are just beginning and likely to continue.

Yet there is a flip side to FDR’s remark. The memorable phrase was just a part of it. His sentence read in full as follows:

“[F]irst of all, let me assert my firm belief that the only thing we have to fear is fear itself—nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.”

It is just such “nameless, unreasoning . . . terror” that we see today, as depositors line up outside banks for the first time in over 70 years.

To sophisticates among us—those who understand economics and corporate finance—the depositors’ fear is unjustified. Don’t those silly people understand that their deposits are fully insured by the FDIC, a branch of the U.S. government? Don’t they know the difference between stock and assets? After all, it’s Fannie Mae’s and Freddie Mac’s stock that is under assault, not their assets. They are nowhere near insolvent.

Politicians, business people, and economists of every persuasion agree on these points. Yet still the people stand in line.

Is there an explanation for this “nameless, unreasoning . . . terror”? Maybe there is. Following, in no particular order, is a short list of the screwups, lies and cover-ups that have laid us low:

1. For thirty years our leaders assured us that cheap oil would never run out. So our auto industry built big gas guzzlers, largely of poor quality, to prove it. Now that gas is $ 4 per gallon and rising, that industry is dying and taking good jobs with it, likely forever.

2. For decades our Catholic Church tolerated and covered up systematic abuse of children by its priests.

3. Our media gave up trying to find the truth. They became celebrity hounds who love a food fight. “He said, she said,” they report. They relegate “fact checking” to nerds on the back pages, which nobody reads. Blowhards and nitwits like Limbaugh, O’Reilly and Matthews give us ire, bombast and titillation for news and analysis, gossip for policy.

4. Our financial system attained the ultimate absurdity: banks eager to lend money to people with no ability to repay. Then its leaders were surprised when loans became devalued. No one in government minded the store because our leaders who run the government don’t believe it can do anything.

5. Our intelligence services failed to thwart 9/11. The failure was systemic and pervasive. Higher ups ignored multiple urgent warnings from agents in the field. The FBI and CIA didn’t talk but fought over turf. Predators had bin Laden in their sights twice, once on Bill’s watch and once on Dubya’s; no one got permission to fire. Condi and Cheney ignored the memos on their desks.

6. After 9/11, things got worse, much worse. Rudy didn’t get the firefighters radios that worked; then he blamed their deaths on their “courage.” He doffed his dusk mask for a few photo ops, encouraging workers to be macho; hundreds came down with life-destroying respiratory diseases.

7. Cheney thought torture and spying were the answer. With Machiavellian guile, he got our “Justice” Department to subvert every constitutional and customary principle on detainee treatment and surveillance. Not only did he force us to give up our civil rights; his methods didn’t work. We now know that false information, provided under torture, became the lies used to justify invading Iraq.

8. Then there’s the war itself. Dubya and that Idiot Rumsfeld—the most incompetent Secdef in our history—ignored military experts’ advice. They sent a small expeditionary force to do an invading army’s job. Four years of blood, destruction and chaos followed before smarter folk began (possibly) to turn things around. While we try to repair the damage we did in Iraq, the Taliban is resurging, and Al Qaeda is threatening a repeat of 9/11.

9. Politics continues to dominate facts. Our intelligence services say that Iran stopped making nuclear weapons. Dubya and Cheney say no but won’t say why. The whole world waits to see whether they will attack Iran as their last hurrah, while generals and diplomats quietly threaten to resign.

10. Then there’s Katrina. A government that didn’t believe in government hollowed out our emergency services and put an inexperienced, incompetent crony in charge. The president stayed on vacation while a city died. Now we wonder why foreigners begin to think of us as a new entrant to the third world.

11. Last but hardly least, Congress became a debating society of buffoons. It failed to stop the invasion of Iraq—likely our history’s single greatest foreign-policy blunder. It failed to set effective immigration policy, energy policy, or regulatory policy. It allowed the executive to roll over it, ignoring its subpoenas and trampling our Constitution’s checks and balances. It has done little to keep the executive from attacking Iran without justification or popular consent. It aped the Roman Senate that made Caesar dictator. And as if to prove its utter impotence and irrelevance, it raised the game of political blame and recrimination to high art.



I could go on, but you get the idea. In the last decade virtually every institution that matters—except our military—failed us. Even the military got sloppy, going along with That Idiot Rumsfeld and, more recently, playing dangerously with loose nukes.

So is that nameless terror any wonder? Most of the folks lining up outside their banks probably know little or nothing about corporate finance. Few could re-create this list of screwups and lies in detail. But they all sense, deep down, that things have gone very, very wrong.

Without knowing precisely why, they feel we have become a nation of cutups, screwups, cover-ups and liars. So they don’t want anyone else holding their money.

Now comes David Brooks, once the most rational and reasonable of conservative commentators. In a recent column, he opined that science doesn’t teach us, and can never teach us, anything useful about human nature. In his previous column, he doubted expertise itself. He bewailed the Obama’s campaign’s tendency to put experts in charge. In his last sentence, he decried Goldman Sachs executives running our economic system. But wasn’t Goldman Sachs the only firm on Wall Street that predicted the sub-prime debacle and avoided it?

When the dean of conservative pundits becomes a nihilist, we are all in trouble.

What we are seeing is sad but understandable. There are only so many major lies and screwups a nation can take. When people reach their limit, they change. They stop trusting each other. They lose confidence in themselves and their institutions. They stop working hard, buy guns, and put their money under their mattresses. Social cohesion dissipates.

We are at that point now. We are experiencing our most complete and utter failure of confidence in nearly a century. We have the national blues. And we have six more months of Dubya and Cheney to endure.

Can we pull out of it? I don’t know. It’s silly to anthropomorphize a whole nation, but the national blues seem much like individual ones. We need someone calm, steady, hopeful, inspirational and competent to pull us out.

That seems to be Obama. But he’s already looking exhausted, and he hasn’t even accepted the nomination. He’s beginning to make serious mistakes, like substituting coal for oil and pontificating on Iraq before his fact-finding mission there.

For all his brilliance, competence, and charisma, Obama is just one man. Maybe the job is too big for any single person. Maybe we are destined to be in a slump for a long, long time.

But one thing is certain. The fear people feel is real and palpable. It may be unfocused and nameless, but it has plenty of justification. No one who ignores it will win the presidency, and no one who can’t calm it will be able to govern. We are a nation that needs both demonstrated competence and therapy before we can believe in anything again.

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All comments on this blog are moderated. My policy for publishing and rejecting comments is simple and firm.

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Opposing and diverging viewpoints are welcomed and in fact invited. Time permitting, I try to respond to comments that I think are interesting or might be persuasive. Replies to my replies are welcome and will be published if they meet these same standards.

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1. Copy the following HTML tags and insert them before and after the words in your comment that you want to highlight as a link:


BEFORE:  <a href="">


AFTER:  </a>

Be sure the quotation marks are the “straight up” kind, as shown, not the printer’s left and right quotation marks that I’ve tried to use in most of this blog. Also be sure that there is a space between “a” and “href” and no other spaces.]

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For further reasons for this conclusion check out
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NOTE: A “rant” is not the same as a “diatribe,” although there may be some overlap. Rants are short on reasons and justification and are generally disorganized, rambling, or repetitive.