We have hashed out the details of how finance became a shell game and our major banks lost track of what was real money and what was speculative. And now, we have the consequent malaise, rippling out and flooding underfoot. People are infused with a sense of urgency and intoxicated by the beguiling qualities of the concept of their own martyrdom.
It's harder to pay the bills, but since I'm a victim of the greed of fat cats, I'm entitled to be pushy and hostile. Maybe so, or at least it appears so much a given truth that we find ourselves believing it is so. A lot of people seem more tolerant of hostility among strangers these days, because they find it "understandable".
Paul Krugman wrote this fall of an impending return to "Depression economics", driven in part by the downward spiral of consumers unwilling to spend as a result of mounting instability in their own financial standing. But there is a psychology that goes along with this that is (in large part martyrdom-based) the bad-faith economy.
Bad faith is very tempting in hard times: we throw up our hands, feel hurt, express disbelief at the selfishness not only of the powerful but of those hurt by their misdeeds. But bad faith cannot build anything and cannot be the foundation of a prosperous civil society: it is an agent of entropy, and it attacks, as a matter of principle, each of the strengths that would allow us to accomplish anything (such as trust, imagination, perseverence, follow-through, a sense of community, purpose, hope or self-confidence).
Bad faith is an economic paradigm, or an anti-economic paradigm, best for throwing whole systems out of balance and into something more like a cynical array of useless, destructive, spirit-crushing cock fights, where the loser is told they're getting the best deal possible. Recovery is somehow inconceivable if we give in to the bad faith paradigm.
As Edward Carr writes in The Economist, "financial instability feeds on itself". Part of the reason for this is that everyone wants to bury their own debt in the remote past and no one is more astute in making the bad news look good than financiers engaging in "creative accounting". But that's where the house of cards shows itself, and teeters...
Once the lie gets too big and reaches into too many people's pockets, the game is up and we all get slammed. The debt is not buried, it is dispersed and that angers millions of people. As it should. Namely because they don't enjoy such opportunities fromt hose same financial institutions when they feel a need.
Somehow, though, someone has to break the cycle, stop acceding to the relentless contagion of malaise and avarice, and bet on good faith. It's just that: there needs to be a system that privileges and rewards good faith and somehow eliminates the threat from pirates, money-hoarders and cheats. The good instinct we find in a moment of clarity or in affection for those around us should guide our social-level actions, lest we fall into a kind of limited solidarity that promotes tribalism, division and bad faith.
The election of Barack Obama showed that tens of millions of people were calling for such a better approach, for a way forward in which the humanity of individual people is also the interest of the collective human energies of society. To "not miss the forest for the trees", we need to see clearly how bad faith inches its way into our midst, how it undermines our best intentions, how it works against us, when powerful institutions decide it should be the rule.