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Among Friends |
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| America's financial crisis: The view from Europe Waiting at the airport to leave on a long-planned European vacation, I read about one economic disaster after another. I paid $400 to giant American International Group Inc., for trip insurance. Now, the government has put AIG under an $85 billion federal financial umbrella to keep it from going bust. If AIG had gone under and we'd had a medical emergency, would our insurance have been worthless? Would we have been on our own? Probably. I have also renewed our $500 semi-annual AIG auto insurance. Would it have been invalid and forced our house sitter -- two hours away from a grocery store via our truck -- to buy a bike or hitchhike for bread and milk? Adding insult to potential injury, when we tried to withdraw cash from our money-market savings account with our new Merrill Lynch debit cards, they were rejected at a bank ATM the day Merrill Lynch was bought by Bank of America. With $10 between us just an hour before our departure, we made a fast call to the calm secretary who has solved our glitches for a decade. She directed us to try another ATM, sensibly reasoning that the one we'd used wasn't working. She was right. When we called back to thank her, she wished us a pleasant vacation and, in a sobering reminder of the volatile global financial crisis, added, "I hope to be here when you get back." Will she lose her job? On an otherwise ordinary Tuesday morning, her life was turned upside down when her venerable financial institution became so vulnerable to disaster that it had to be bought out between breakfast and lunch. Boarding a plane owned by an airline that in the past was rumored to be on the verge of bankruptcy, we agreed not to think about its announced October schedule cuts. Why worry about being stranded an ocean away from home when we have no control over events? Setting off for a long-postponed visit to countries where the dollar is in free-fall against local currencies, we thought we'd escape the 24/7 drumbeat of horrible news about the wildly gyrating stock market. We couldn't have been more naive. People the world over are directly affected by Wall Street's meltdown. Worries about the ripple effect on their children's education, retirement, jobs, mortgages and quality of life is on every front page and leads all newscasts. But it's not as if we haven't been in a year-long rehearsal for this main event. When our gas went to $5 a gallon, the general store raised milk to $7.20 a gallon. Our electric bill stayed steady despite disconnecting the dryer and limiting ourselves to two lamps at a time. We realized we had to roll with the punches. Nobody knows whether the worst is over, or whether more global tsunamis are bearing down on us. Experts in every major capital say we may not learn the outcome for months or years. We live in an interdependent global economy linked by nanosecond communication. One shoe dropping in Washington vibrates economies from Los Angeles to Lagos. Despite more frequent comparisons to the Depression -- alleviated only by World War II -- we seek uneasy reassurance in history by hoping that happy days will indeed come again, the dollar will rebound, our homes will regain their real, if not inflated, paper value, and the value of our retirement savings will be restored. By most accounts, in the United States, Asia and Europe, petty political maneuvering has been shoved aside temporarily in a dangerous period requiring great minds and high integrity. There is no room for Machiavellian rivalries when only a unified rescue effort will set America back on course and steady its, and the world's, economic underpinning. Instead of cowering under the covers at home, we've opted to continue this long-planned, mostly prepaid vacation because we won't be able to afford another one for a long time. There will be plenty of time later to worry about what the future holds. For now, we're in a sort of adult time-out, watching the Wall Street and Washington action from distant corners. Perhaps the view will turn out to be clearer from here. |
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