The current crisis did not begin with Trump, contrary to the vain repetitions of the Never Trump crowd. The Left’s woes didn’t begin with Alexandria Ocasio-Cortez. The political turmoil on both the left and right started a couple election cycles back with Bill Clinton and Chuck Schumer. What began with government good intentions and notions of correcting injustice caused one short-term fiscal calamity and continues as a rolling cultural catastrophe.
Twenty-five years ago, the premise was this: minorities were being discriminated against when trying to buy homes. Black people, single women, and other marginalized folks were being blocked from access to credit to buy homes and therefore being deprived a piece of the American Dream. Was this true? Maybe. If it was true, the cure to this problem was worse than the disease, a cure which very nearly killed the American body.
Chuck Schumer, the ranking senator on finance and representing the great state of New York and Wall Street, pushed rules onto lenders forcing them to liberalize their lending practices. He was joined in his folly by Barney Frank, Democratic Congressman from Massachusetts. Together, the Democrats through threats and rules encouraged bankers to start giving loans to anyone and everyone. For more background on this mess and who is to blame, read this by Theodore Houseman. He quotes Barney Frank, who said this:
I have seen nothing in here that suggests that the safety and soundness [of Fannie Mae] are at issue, and … it serves us badly to raise safety and soundness … when it does not seem to me to be an issue.
– Rep. Barney Frank, D-Massachusetts, Financial Services Committee Ranking Member, in response to claims that the Government Sponsored Enterprises (Fannie and Freddie) posed a huge risk to the American taxpayer.
Bankers understood the consequences if they did not give loans to “redlined areas” — places on the map that were poor minority-majority areas. Where Democrats saw racism, bankers saw high-risk loans that people wouldn’t be able to afford to pay back. The bigger risk to bankers, though, was to be accused of being bigots and racists. So they gave loans to bad risks. Lots of them. Then they bundled these subprime loans and sold them. They built a financial house of cards. Low interest rates and loose lending standards encouraged middle-class folks to buy investment properties. All these TV shows about flipping and making money off of homes? That all started in the late 1990s.
The real estate bubble that burst late in George W. Bush’s tenure didn’t just happen. It was a creation of a questionable premise of racial injustice and then Democrat regulatory policy and rhetoric that encouraged irresponsible lending and the taking on of loans that people couldn’t afford to repay. Loans that the government backed up and put taxpayers on the hook.
When the spun confection imploded, America’s financial system nearly collapsed. Individuals and then the institutions that funded them defaulted on their loans. There was not enough money flowing through the system. Choked of capital, the entire engine very nearly seized.
And it all started with a false Democrat premise.
What does that have to do with America nearly 14 years after the crash and a generation since this debacle started? Everything.
Republicans were demoralized. George W. Bush’s tenure ended in crisis and disappointment. The Democrats in charge of Congress were running the country into the ground. Americans lost their homes. As the housing market crashed, even responsible people found themselves upside down in houses they couldn’t sell and couldn’t afford as the resulting recession left them downsized. Their life savings were wiped out.
Big businesses like General Motors and “too big to fail” banks were bailed out with taxpayer money. Small businesses suddenly had no access to capital due to egregiously tightened lending requirements. They failed.
In the wake of the mortgage mess, citizens groups started to gather. On the Republican side, the Rebuild the Party movement which began during Bush’s tenure morphed into the Tea Party movement catalyzed by a 2009 rant by CNBC commentator Rick Santelli. Their motto: Taxed Enough Already. Their gestalt? Leave us alone. Stop bailing out banks. Stop bailing out irresponsible home buyers. About one-third of the Tea Party were libertarian types who just had all their suspicions about government incompetence confirmed. Their hero was Ron Paul. The rest were populist types who worried about their Social Security and jobs and hated the bailouts for big businesses, banks, and greedy home buyers while the average guy lost his job and/or had to pay for the bailouts.
Tea Partiers weren’t socially conservative necessarily. Rhetorical leaders like Andrew Breitbart introduced the concept that politics was downstream from culture. Tea Party types started making the connection between the cultural ideas put forth in education and entertainment that created policy. Thus, many of these folks also became interested in school choice, stupid policies like No Child Left Behind, etc.
On the Democrat side, Occupy Wall Street bloomed on the streets of New York. Unlike the Tea Party, which started out as an organic movement and slowly became organized and co-opted by more professional activist D.C.-based institutions, Occupy started as a Soros astro-turf movement that drew to it the dregs of society. The movement, over time, radicalized into groups like Antifa and Black Lives Matter. All the snazzy, militaristic equipment of the Black Block members of these groups is funded. It didn’t “just happen.” Occupy, though claiming to be a loving Marxist organization, suffered with crime against its own members. Women were raped in the encampment and didn’t want to report the crimes for fear of harming the causes. Andrew Breitbart famously yelled at a bunch of Occupy activists, “Stop raping people!”
Since 2007, this unrest has undergirded political reality. The Tea Party movement, far from being toothless, started putting up candidates. Barack Obama won in 2008. It was to be the last Democrat triumph for a while. In 2010, the first Tea Party wave crashed into Washington, D.C. Elites on both sides of the aisle were united in their loathing of these upstarts. In 2012, Obama won, but so did a bunch of Tea Party senators, including Ted Cruz, Marco Rubio, Ron Johnson, and Rand Paul. Mitch McConnell and the rest of the leadership did their best to marginalize them, depriving the Tea Party movement of power and a place at the table.
In the intervening years, Republicans and the commentariat have sneered at the Tea Party’s lack of effectiveness even as the Tea Party gave Republicans leadership in both the House and Senate. They put the fiscally concerned and conservative Tea Party group in the House in a corner. In response, these House members would rebel and tank legislation. The Republican party leadership claimed to be for fiscal responsibility, but didn’t govern that way, and the Tea Party members sought to represent those who voted them into office.
It’s worth noting the media’s actions at the time. The Tea Party leaders were often women and, in many places, minority women. These leaders were acutely aware of how the media would portray a bunch of people protesting Obama and the bank bailouts and then Obamacare, which they rightly identified as a huge tax increase on the middle class. Tea Partiers were rigorous about booting the cranks and imposters with racist signs, etc. They meticulously cleaned up after themselves. They protested peacefully. Even still, the media portrayed them as racist and evil. The Republican establishment didn’t mind as they didn’t like the activists either.
Come another presidential election, war hero and political moderate John McCain was portrayed as far-right. The McCain campaign, led by former Bushies who are almost all now Democrats, refused to let Sarah Palin campaign in Michigan. She rightly saw the frustration within union ranks. She was sunny, populist, beautiful, and spoke the language the working class understood. She was and is one of the most naturally gifted politicians America has seen, and the McCain camp muzzled her. Her instincts were right, though. Eight years before Donald Trump took Michigan and stunned Democrats, Sarah Palin knew the Rust Belt could be Republican.
Four years later, the Republican establishment crowned Mitt Romney king. He was the wrong man at the wrong time. As the economy stagnated, the last guy America wanted was The Boss as president. The middle and working class was decimated by investment capital guys like Romney. He was the caricature of the manager everyone hated. Another political moderate, the media treated him like he was a fascist. Big bird, binders full of women, and high school haircuts characterized the media portrayal of Mitt Romney, a loyal family man and decent guy.
While the Republican establishment didn’t accept that the media would destroy any Republican, no matter how moderate, their base voters did. The voters had enough of conventional politicians looking the part and then selling them out with legislation that is exactly the opposite of what they wanted all the while seeking the hateful media’s approval. In a crowded field of solid Republican talent, newbie politician Donald J. Trump came to the fore. Many in the Tea Party wanted a fiscal conservative like Ted Cruz. And, in fact, Sen. Cruz won his home state. Even Cruz, though, couldn’t overcome Trump’s formidable abilities, the chief being his pugilistic interaction with the media. He, more than any other living Republican, knew both the cultural and political establishment and the media. Like most Americans outside the Beltway, he had little use for either.
Trump’s honest outrage at the political classes’ failures reflected the feelings of many Americans. Had the working class been destroyed? Yes. Had the middle class been abused and harmed? Yes. Had small business owners been frustrated, inhibited with regulations and taxation? Yes. Were corporations encouraged to move production overseas due to taxation, regulation, and rhetoric? Yes. Had stupid wars sapped America’s strength? Yes.
Trump laid bare their corruption for all to see. He knew their contempt and what they said behind closed doors. He knew the stupidity and mendacity of the media.
Many establishment Republicans, especially, think that Trump’s rhetoric is a ruse. They think that he postures at populism and is simply sloganeering to gain power for its own sake. They view him as an empty charlatan pretending and using the American people to feed his egotistical need to run things — America as his most recent business acquisition. They’re wrong, both about Trump and about the people he represents.
President Trump’s voters saw, for the first time, a Republican who kept his promises against a tsunami of opposition from the media, the Democrats, and, worst of all, his own party. Trump’s rhetorical and policy loyalty to his voters has garnered fanatical loyalty in return.
Trump’s voters are often portrayed as cultists. This is projection. President Obama, a lightweight and lazy politician, enjoyed slavish devotion from the Left and more importantly, the media. It continues to this day. Obama’s 1000-watt smile, talk-show circuit gabbing and slow-jamming gave vacuous commentators and media types the character they wanted. Plus, he was black. White liberals, black liberals, and even many so-called conservative commentators swooned. Forget the content of his policy; his pants were pressed perfectly.
In contrast, President Trump enjoys steadfast support because he steadfastly supports his voters. If these citizens seem desperate, it’s because they believe, and maybe not wrongly, that they’ll never have political representation again.
On the left, Democrat cities are infested with homeless encampments filled with drug addicts and hopeless people — people who lost their jobs, homes, and, finally, their dignity. High-minded and pharisaical, leftists drive past these sufferers on their way to their gated communities, figuring that the government will take care of the problem. They pay huge sums in taxes. Their capacity for charity is all taxed up. The homeless touches with government often are the police and the jailer. Mentally ill, drug-addled police interactions rarely go well for anyone.
Radicalized college students high on Marxism and literally high, and also bored with COVID incarceration, march, burn, and loot in protest. It’s in the name of racial justice, but it’s more about power. Their solution is tearing down the current system, burning it to the ground, and starting over with some form of communist utopia where everyone has a job, a roof over his head, and food, and hopefully drugs but not too many, in his belly.
Corporatists like Barack Obama and now Joe Biden won’t mollify the Antifa–BLM–AOC wing of the Democrat Party. The problem is that the message these activists embrace isn’t entirely wrong. Democrat leaders, like the Republican leaders, are wholly beholden to big corporate and technology interests. Rich people pay their way, after all. That’s why Biden’s appointees are a hodgepodge of social justice and big business and big military. The Democrat Party is a mess.
In the wake of government, media, and big business betrayal of America, both sides’ bases are hardening. But so are their leaders. A toxic mix, the ingredients thrown together in the late 1990s, brews and is crystalizing into pure, refined political poison.
Words and votes don’t seem to be getting the political elite’s attention.
American governance and her form of capitalism has been hung in the balance by the American people and found wanting by both sides of America for different reasons. Americans distrust the bureaucracy, the media, the politicians, the police, and the voting process itself.
Still the media and the elites in both parties act as though the next political cycle will magically get the country back to normal, to norms, blithely denying their part in destroying norms. It’s as if they hope the country embraces their fit of amnesia.
Have these leaders considered how frustrated people solve problems when words and votes fail?
The year 2020 wasn’t the apex of the crisis. It is the beginning of it. Layering COVID and the American mayors’, governors’, and scientists’ abject hypocrisy onto this toxic environment further illustrates Donald Trump’s point. The questionably fraudulent election is icing on the cake. The voters see and understand who benefits with the return to norms. Hint: It’s not them.
If people conclude that even voting in overwhelming numbers doesn’t matter, problems will be solved another way.
Shutting down the economy for a year, destroying small businesses, and closing schools (over one-third of small businesses in New York and New Jersey are permanently shuttered) while simultaneously wiping out the service industry and making those workers jobless means that the government and bureaucracy is undermined even as people need more support. There have been street protests, ostensibly about racism and police brutality, but as much about pent-up frustration from being penned like animals.
Big corporations thrive during the COVID economy, in contrast to their struggling small business brethren. Government workers have not missed one paycheck. Certainly, no elected official has missed a paycheck — except Donald Trump, who doesn’t take one and has seen his business shrink since taking office.
Meanwhile, there’s a looming mortgage crisis, again. Over six million people missed their October mortgage payment. Over a third of renters aren’t paying rent — but their landlords must still pay their bills.
Then there are the educational disparities being forced by big-city teachers’ unions, who serve the most at-risk children. The teachers are refusing to go back to school to teach, and these children are left behind. Kids in the suburbs are being taught in-person, though. These disadvantages will be felt for a generation.
Europe is erupting in protests. The American media, provincial and Trump-focused as usual, ignores it. How long until mass protests happen here? Or will the managerial class be content to have a large swath of America out of work and dependent upon the government?
Donald Trump’s tenure resulted in a pro-American and pro-growth business environment, capital and jobs returning to America, real wage increases for the working class and lower middle class, and historically low unemployment. The fear and frustration of the small businessman, blue-collar and service working Americans was starting to fade and be replaced by optimism. This harmed the interests of the Left. Taking away a population’s dependency means depriving Big Brother of his power.
The government aristocracy, media, foreign policy, and educational elite are thrilled to have Biden back. He will bring a return to the policies that they enjoy: hegemony of the “elites” who got America into foreign entanglements, a tyrant-appeasing citizen-of-the-world philosophy that enriched and emboldened China, Russia, and Iran and marginalized Taiwan, vulnerable European countries, and Israel. Jobs and economic power will be exported, harming the American middle class in service of cheap goods from countries who hate America.
America’s current political environment started nearly a generation ago with a wholly preventable mortgage lending crisis. Each election since has been an attempt by Americans to get the focus back on America. Between 9/11 and an endless war that followed, the housing crisis, and unchecked immigration coupled with exporting jobs, Americans just want to to come home, go to work, and come home again.
Donald Trump recognized this and promised to remember the people. When he did as promised, the establishment attempted to destroy him. It continues to this day. It is possible that Donald Trump and his family will be persecuted for the rest of their days for the crime of revealing the government no-talents for what they are: empty, callous, self-dealing, America-indifferent mediocrities with a lust for power and other people’s money.
Trump’s voters would be weird if they didn’t take this behavior personally.
When will the dam burst? It’s difficult to predict. There will come a day — soon, one suspects — when Nancy Pelosi gets recorded doing another maskless haircut or a mayor or governor insults his or her voters so flagrantly that he incites the populace. That Americans haven’t yet full-throttle revolted is a testament to their patience and goodwill, or maybe to their apathy and hopelessness. Gun shops and sporting goods stores have run out of ammo except for buckshot, and even that’s getting difficult to find. This should concern the powers that be.
When words fail, when votes fail, when people feel like they have nothing to lose, desperate people do desperate things. Half the country believes they’re being deprived of the politician they voted for and who finally spoke for them. The other half are agitating to destroy the system they believe is fundamentally unfair. The people at the top seem indifferent to everyone. The road that started with government interventions won’t end well.
Correction: A previous version of this piece stated that Rick Santelli worked for Fox Business. Mr. Santelli works for CNBC.