Matt Stoller: America’s old social contract unraveled with onset of Great Recession

The following is a tweetstorm (set of tweets) posted last night by writer and activist Matt Stoller that we found compelling. It has eight parts:

  1. The 2006-2012 foreclosures signaled the end one social contract and the beginning of a period of deep political and economic instability.
  2. The crash of the housing market radically altered the wealth and power distribution mechanisms for the American political order.
  3. Since the 1930s, housing operated as a proxy for wealth and stability, while allowing the banking system to serve as a channel…
  4. …through which the Federal Reserve could manage the economy.
  5. As financial asset growth replaced wage growth, housing became a leverage point masking the deterioration of our financial status.
  6. The housing crash, far from a simple downturn in one sector of the economy, represents the collapse of this entire apparatus.
  7. It snapped the spine of a political system that had connected elites with everyone else, through the monetary channel.
  8. The result is increasing political chaos, rising authoritarian structures, and social unrest.

Good observations, Matt!