Guest Column: Middle class deals with the 'R' word

There they go again, using that “R” word.

Frankly, I don’t think it takes a group of expert economists who know Wall Street to tell folks who know Main Street Missouri that it feels like the U.S. economy is in a recession.

It doesn’t take a TV pundit barking about the complexities of the stock market for Missourians to understand that their retirement savings are down and college tuition for their kids is up.

It doesn’t take the federal government announcing that there’s a credit crisis in this country for families to know that their neighbors are losing their homes and, in this economy, sometimes the only way to live month-to-month is to put it on their credit cards, praying that it doesn’t trigger an increase in their interest rates.

Americans are not stupid.

Americans who work hard for their money saw that their money was not working as hard for them some time ago. They saw this recession coming.

However, while “experts” were distracted by positive signs caused by the housing boom across the country several years ago, a few on Wall Street were toasting to the fortunes they made from bad loans, knowing there might be consequences for some homeowners. “What’s the worst that could happen?” they thought.

But the bottom fell out. More homeowners were affected by those loans than anticipated. More and more residents all over the country were having the American dream of home ownership ripped from their grasp.

As a result, local economies are suffering and many on Wall Street are paying the price.

Congress already had begun to look at emergency help for local economies with both a stimulus package that would send checks to hardworking Americans as well as a means to address the rising foreclosure rate.

However, no one expected that more immediate help would be needed when the fourth-largest investment bank in the world, Bear Stearns, unexpectedly collapsed, which could have potentially put our economy in a tailspin.

To the credit of the Bush administration, Federal Reserve Board Chairman Ben Bernanke announced that the administration had worked throughout the weekend on a deal where JP Morgan Chase would buy Stearns’ shares for $2 apiece – after they traded at $171 per share in January 2007. JP Morgan Chase later upped the deal to $10 per share. 

Some have been critical of this deal, calling the availability of federally backed insurance a bailout of Wall Street, but I’ll tell you that it wasn’t.

That was an emergency insurance plan that made sure that come Monday morning we wouldn’t be in a depression. Bear Stearns and their shareholders suffered extreme losses, as they should, but at least they didn’t bring the rest of us down with them.

However, the administration playing weekend warrior for Wall Street begs the greater question: When will they pony up and do the same for the middle class?

It’s about time that the administration that has vetoed children’s health insurance and job training, health care and education legislation worked over the weekend with Congress to do what’s necessary to fix these programs so that sick kids can get health care.

These policies that would stimulate the middle class economy shouldn’t be stopped because of politics, and it shouldn’t take a major economic disaster to get them going.

In fact, with the price of oil edging close to $115 per barrel just in time to send gas sky high for the summer, it just might be the right time for the administration to show Main Street that they have n emergency insurance plan for them, too.

It’s time to roll back those tax breaks and subsidies to the big oil companies who are making record profits while we pay record prices and instead give them to hardworking Americans who really need the break.

U.S. Sen. Claire McCaskill, D-Mo., and her staff can be reached at (417) 868-8745 or at www.mccaskill.senate.gov.