Is the current economic crisis related, in any way, to the destruction of the World Trade Center on 9/11? Don’t you think that all of our problems can be summed up in those three words (in more ways than one)?
Countries in Europe are in a recession similar to the U.S. Clearly this is happening on a global, or “World” scale. While the derivative trading scandal of AIG, et al, is most certainly related, there is definitely a financial or “Trade” effect. And the “Center” of it all was, in no small part, The World Trade Center, which was destroyed eight years ago.
Has there been a long-term economic effect? Certainly the costs of war contributed to our economy. And other than the wars in Afghanistan and Iraq, what sort of economic affect has arisen from the singular attacks on a “World Trade Center”? Who had a greater effect in this recession? Bush? Al-Qaeda? Cheney and Co.?
I have never heard anyone say it had anything to do with the 9/11 attack, which happened 8 years ago. I think it has more to do with the subprime/financial meltdown, the drop in property values, and the lack of credit for business than anything else.
Not at all. The root cause of this issue is a mishandling of a mass amount of mortgages turned into securities and sold with ratings that were clearly not reflective of the actual risk. If there was no 9/11 you would be in the same position.
>Who had a greater effect in this recession? Bush? Al-Qaeda? Cheney and Co.?
Neither. The US is rich enough to handle two wars and an economic crisis, albeit with deficit spending. The guilty parties here are political as much as they are economic. Namely mortgage brokers and financial houses who took huge risks. There is no connection to terror. In fact, all the solutions to this issue are about financial regulation and not anything to do with terrorism and war.
I guess someone could make a good argument that the problem is highly political because of conservative deregulation and Clinton-era home ownership push, but neither has to do with terror or war.
It was caused by the subprime mortgage crisis. A number of large banks had sold mortgages (among other things) to others as investments who then took out insurance against defaults of those mortgages. When they began to default in large numbers, the insurers (AIG was the largest) couldn’t pay for all of them, and then the banks were left with large losses on their investment.
The basic assumption appeared to be that the housing market would never collapse or contract.
So basically, Enron or the dotcom bubble writ large.
9/11 caused Bush to be elected in 2004.
Any competent president would have jumped on subprime etc. while a soft landing was still possible.
Not so with W.
This is what’s technically known as a “coincidence,” sometimes also called “a huge honking leap of logic.” The problems that caused the current crisis started long before the September 11th attacks and are not connected to them. I am not sure about Squink’s conclusion about what another president would have done, but we’ll never know for sure, and it’s only a tangential connection.
While the proximate cause is the sub-prime mortgage debacle, the root cause is the Federal Reserve’s loose monetary policy. After the burst of the dot com bubble and the 9/11 attacks, emergency liquidity was injected into the banking system. While these measures were necessary (at least under the current system), it is equally necessary to remove the liquidity when the crisis is over.
Greenspan should have done that by raising interest rates. Sure, the stock market may have taken a dip and we perhaps would have had a mild recession, but Greenie didn’t want his legacy marred with imperfection. He ended up trading a small recession then for a big depression now. So to simplify, instead of allowing us to deal with a mild hangover he kept feeding us booze day after day until he ran out of vodka. Now we’ve got the dt’s.
The dot-com bubble burst followed by 9/11 led Greenspan to drop the prime lending rate to shield the economy. However, the availability of cheap credit had the somehow unforeseen consequence of overleveraging, leading to the subprime mortgage crisis.
If we have resolved that 9/11 had little or no impact on the current economic crisis, that in itself is an interesting fact.
One assumes the planners of 9/11 would have hoped for mass economic disruption. Since that didn’t happen, we could conclude that the only lasting damage apart from loss of life, was what we inflicted upon ourselves in the aftermath.
The creation of the TSA springs to mind, along with some civil rights infringements and a couple of wars.
Some people around here have argued that Bush is one of the few people in government to acknowledge the dangers of the subprime market and was mostly ignored when he tried to do something about it. If anyone with better search-fu than mine can find those old discussions I’d appreciate it.
One could go as far as to wipe several major cities off the map, and it would still not significantly impair the country’s ability to function. Commerce, communication and everyone’s day-to-day life would continue largely as it did the day before the event.
Short of a truly cataclysmic disaster, or the invasion and generations-long occupation by a crushingly powerful army, it is hard to think of any external factors that can shape a society more than the society’s own reactions to events.
If the towers had fallen due to, say, structural flaws, do you think it would have made a blip anywhere beyond Congressional pontification and architectural textbooks? The loss of a couple of buildings in a single metropolis does not constitute a national tragedy, unless you make it one.
I don’t buy that. If he spent the political capital on fixing this, instead of the Iraq war, instituting torture, and ruinous debt we’d be in a lot better shape then now.
Anyone who voted for him is truly a traitor or a manipulated cowardly fool. Prolly both. The blood of the hundreds of thousands of dead is on their enabling hands.
I hadn’t heard this; I’ve heard his “ownership society” ideas discussed as a contributing factor to the crisis, although the initial factors preceded him.
Since the former two are closely related to 9/11, and the latter somewhat less so but definitely an economic problem, yes it is a thread that touches on them.
I found a conservative blog that claims a white house press release on 5/29/02 urged stronger oversight of fannie mae and freddie mac, but I can’t find a non-biased source for white house press releases that don’t require me to subscribe. Does anyone know of a way to search for such a thing?