The American dream turned nightmare

The irony of this whole financial mess that Wall Street created, and for which it is being crucified, is that middle and lower income groups benefited from the sub-prime bubble, enabling them to live that American dream of owning a house. A couple of months ago, they woke up to find that the dream has turned into a nightmare. A lot of people who are about to retire feel the crunch even more with retirement plans losing $2 trillion in the past 15 months. Savings are getting depleted; people over 50 have postponed retirement plans and are now working longer hours.

Americans have always been proud of their country as a land of great opportunity, where everyone can be prosperous if they work hard. The US has an estimated population of 305 million, with more than 70 percent of the people belonging to the working class - the ones hardest hit by the US financial turmoil. Some people are comparing the current crisis to the period of the Great Depression in the ’30s.

The financial crisis opened a Pandora’s Box of hostility. Somehow, every other ordinary American I spoke to harbors strong disgust against the wealthy being bailed out. Up until early 2007, prospects in US financial markets were relatively positive. In 2000, Americans experienced a housing boom, with property values rising by as much as 50 percent. The sub-prime mortgage industry re-engineered applications to accommodate more borrowers, extending “ninja” loans to people with neither income nor asset and had little hope of repaying. Charles Morris, author of The Trillion Dollar Meltdown, said “sub-prime lending jumped from an annual volume of $145 billion in 2001 to $625 billion in 2005.” But just like most booms, it eventually “veered into destructive excess.”

The growing resentment is caused by the perception that the bailout plan will leave the average American footing the bill. This anger is even stronger now with revelations that Wall Street executives were living it up, paying themselves fat salaries and giving themselves “golden parachutes.” The outrage is also fueled by news all over the US that AIG — the world’s biggest insurance company — spent over $440,000 partying at the famous St. Regis Resort. It’s probably one of the most expensive resorts in California, and it was showed to me by a friend who told me that you wouldn’t even think of going there unless you have a large expense account. AIG executives knew too well they are getting an $85-billion bailout, yet these people spent some $23,000 for spa services, while Lehman CEO Richard Fuld also got $250 million in bonuses and salaries, giving a $20-million compensation for resigning executives 11 days before Lehman filed for bankruptcy.

A lot of finger pointing is going around, and like what happens in most countries, the finger points to the guy at the top — in this case, George Bush who is blamed for being too lenient with Wall Street. George W has earned the ire of many Americans most especially for Iraq which many feel is a war that the US didn’t have to get into. Most soldiers come from middle class families, and it doesn’t help that Bush is wealthy with a personal net worth estimated at $26 million. There were also accusations that the Iraq war benefited his Texan and Halliburton pals.

All these have put John McCain in an awkward position where he’s having a difficult time distancing himself from Bush. And because of the current resentment against the rich, it doesn’t help that his wife Cindy is a socialite with a $100 million net worth, and the heiress to her father’s stake in a beer company. The American media had earlier exposed the McCains’ numerous houses and that they paid $136,572 in salaries for their household staff last year.

Disgruntled by the crisis and angry at the wealthy who they think are being allowed to get away with murder, people will see the November elections as payback time. The Republican is beginning to show his famous temper, in the recent debate calling Obama “that one.” Ironically, it was Democratic vice presidential candidate Joe Biden who defended the Republican candidate, explaining that it was McCain’s way of addressing anyone that he is uncomfortable attacking. McCain is trailing Obama in many states, and he is blaming media for showing him to be a hothead while Obama is pictured as cool and collected.

Destiny happens to people who are in the right place at the right time, and it looks like Obama is in that position right now, poised to fulfill the historic role of being the first black president of the United States. While racial issues initially hobbled him, there is now an overwhelming sentiment that he will handle the economy better. Obama has captured the imagination of voters with his story, coming from a middle class family, raised by a single working mom, a boy who grew up poor in Indonesia with a stern but compassionate stepfather. Obama has fashioned himself as the candidate for “change,” a buzzword that Americans crave for in a nightmarish situation.

Obama talked about the kind of hope nurtured by slaves sitting on the fire singing freedom songs, of immigrants setting for distant shores, of the poor who defy the odds, of a “skinny kid with a funny name who believes that America has a place for him, too” in his book The Audacity of Hope. And from the way things are shaping up, it looks like Barack Obama’s audacity of hope and his dream of living in the White House is about to be fulfilled. 

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