A combination of the Reagan and Bush II tax cuts and the Clinton-instigated stock market boom decoupled about 5% of the US population from any mooring in the reality of prudence, thrift, or real-world want, and sent them off into a stratosphere of vast wealth and conspicuous consumtion. Another 10% of the population have had enough wealth, or access to enough ready credit, to emulate and identify with the super rich. Perhaps another 10-15% are solidly middle class, and the rest of us are floundering or have gone under altogether.

In the age of industrial capitalism, it was the classic businessman who largley held sway in society, and he was partially checked in his ambition by a large and organized industrial working class. Today, America is dominated by an investor class, which produces not tangible goods but "investment insturments", and it is these guys (and a few gals) who rule the roost. Their worldview is the worldview of the Power Elite, and it is they who must be consulted and indulged. Worse, they face no organized opposition the way Carnegie and Ford and Rockefeller did 90 years ago. And thanks to consumerist ideology and (up until recently) mass cheap credit and government subsidized home ownership, almost everyone admires and aspires to join (or at least in a low-rent way emulate) the Masters of the World. The hegemony of their worldview still holds sway. Things will have to get a lot worse before these people will be repudiated, and perhaps called to account for their profligacy and sinister stewardship of our economy.

I'm having a hard time these days figuring out who the GOP think they are representing. Are they simply the tools (joke intended) of an ultra-rich elite who are so wealthy that they are beyond caring about something as insignificant as a major recession? Are they simply the mouthpeices for angry white hetero males and their me-too dumbass spouses? Does the Southern and rural Chamber of Commerce/Country Club set still number enough voters to command the alliegence of the GOP? Do Bible thumpers really not care about their jobs and mortgages?Who the hell do these anti-bank, anti-auto, anti-stimulus clowns represent? To quote Butch and Sundance, "Who are these guys?"

Cutting taxes is not the answer because it gives to those who got and does nothing for those in need. Spending money may not work because the US economy is so porous that half of it will bleed overseas to import stuff we can no longer really afford (the same, of course, is also true of rich folks taking their tax savings and buying luxury items from overseas or stuffing it in the Caymen Islands). What we need is savings on a massive scale so that the banks have money to lend and exports have a chance to outpace imports. I'd propose huge tax incentives to save, not spend. This would be very tough in the short term, but better in the long term, while the government took what little money it has and spends it to help those who lose their jobs in this process. Such thinking, alas, seems to be beyond the ideological blinders of the Friedmanites and the Keynesians who make up 95% of all economists in this country.

Three years back I had the head of the College Republicans on my campus ask to do his Seniors Honor Thesis on Reagan, Star Wars, and the End of the Cold War. As the only military historian in town, I got to be the primary reader of the thing. Within a month, I had this kid's head spinning, because, to put it bluntly, Reagan's position on the USSR and detente were a moving target, and by 86-87 he was way out ahead of both Republicans and Democrats in pushing for serious arms reductions and concerted dialogue with the Ruskies. The image of "Reagan the implacable, unbending foe of the commies" fell apart as this kid looked through the record. What will horrify the Repubs of today is that Reagan became a pragmatist as he went along, and was ready to meet anywhere and talk about anything with his adversaries, and even, dear God, compromise with them in the interests of peace!

Reagan, on balance, did more bad than good IMO, but the Republicans of today are more full of shit when they portray him as a brain-dead, no-talk, all guns proponent of endless confrontation than when they argue he was a "great" President.

The UK under Baldwin and Chamberlain did almost exactly what the WSJ types want--they slashed expenditures, halted convertibility of Sterling to gold (thus letting the pound fall to its "natural" market price), and hunkered down so as to ride it out. This all worked slightly better, if you include the bad year caused by the premature withdrawal of funds from New Deal projects in 1936-7, than the New Deal did. But only for three reasons: deflation made food affordable even for those receiving a pitance on the "dole"; Britain was simply the most traditional and politically stable nation on the planet at that time; the British had not enjoyed much of a boom in the 1920s, so the relative impact of the Depression (or "Slump" as it was known) was less and the economy did not contract as much as it did in the USA.

Add to this the extreme hardship many had already experienced during WWI, and the lack of the classic American belief in endless progress and bondless possibilities, and you can see why the National/Conservative governments of 1931-1939 could adopt the old policies and ride them out. Of course, massive rearmament starting in the second half of 1937 eventually ended their Depression, too, just as it did in the USA.