The banks, insurance companies, hedge funds – the whole collection of major financial enterprises – thought they had pulled off the coup of the century. They had taken immense risks, chiefly with other peoples’ money, to make every greater profits and, as has happened so often before, they had gone way too far. Their financial speculations hit a wall when excessive borrowers could not repay excessive lenders. Lending stopped in a capitalist economy that depends on it. While lenders and borrowers blamed each other, the financiers called in the government by means of threats. You must bail us out to get credit flowing again or else the economy will crash and you politicians will all be deprived of your comfortable positions. They  got their bailouts and everything seemed to be in order.

The people did not object. They did not move against the financiers who speculated, the businesses that froze wages since the 1970s and moved jobs away, the government that never stopped them.  The people seemed stunned as the promised endless capitalist prosperity collapsed, a prosperity on which they had staked their hopes and dreams. They nodded dully as governments rushed to bailout financial enterprises and other businesses because that’s what they wanted the government to do.

The financiers not only got the government to borrow the money for those bailouts, the government borrowed much of it from those same financiers. They used what the government gave them not to lend to consumers and businesses (“to kick start our economy”) but rather to lend to the government. How utterly charming a scam. In a final move that leaves lesser mortals stunned, they have directed angry demands at governments that they must impose austerity (raise taxes and or cut social programs) to set aside money to repay government creditors who are worried about their loans. And governments have been doing just that.

A deep crisis of capitalism had not only avoided bringing the system down, it had actually accomplished what had been impossible before: the reorganization of government to better serve capitalists at the expense (raised taxes and reduced public services) of the mass of people. Of course, the subservient press extolled “the recovery.” Of course, angry people who felt the sting of what was happening to them, started blaming whoever seemed to be the current villains (bankers, politicians, over-indebted poor people) or the traditional villains long blame for social ills (immigrants, terrorists, African-Americans, Muslims, Jews, etc.).

The financial enterprises had cashed in on the desperation of a US working class that borrowed too much when their post-1975 wages no longer sufficed to buy the American dream. Everyone from advertisers to academics told them that dream was their right as Americans, a measure of their personal worth, and a sign of their qualities as parents giving to their children. The financiers pushed loans on these anxious borrowers and then sold those loans to investors around the globe, charging massive fees and commissions on both ends of these transactions. Businesses who prospered because their customers could borrow to pay their bills then also borrowed on the assumption that business could only get better. The financiers forgot all about their supposed skills and trustworthiness in “properly assessing risk” in their rush to cash in on the booming loan business. As so often happened, their heady profits soared so far and their own promotions worked so well, that they fooled one another and themselves too. The financial enterprises too loaded up on these loans to the masses and to businesses.

So when the crash came, when the over-indebted people and businesses defaulted, the financiers were in very deep doodoo too. But their cosy links to politicians plus the threat that if credit stopped flowing so would the rest of the economy won for them trillions in government bailouts. Not punishment for failing in their functions troubled the financiers. No consideration that the state or workers themselves might manage credit and economy better worried them. No serious alternatives to going back to business as usual had a chance in the blizzard of rhetoric flowing in 2008 and 2009.

Instead, we have austerity and weighty debates on the dangers of deficits. What? Deficits did not cause this crisis; they are its results. Workers frozen real wages since the 1970s were a major cause. Having now discovered that you cannot endlessly substitute loans for wages, neither capitalists nor their US government is doing anything to raise wages. Instead, to deal with deficits, we hear, taxes will have to rise or public services will have to be cut or both. That is the real solution, we learn, to the crisis provoked by stagnant wages and financial speculations. This is so preposterous one must stop and take a step back to gain some perspective.

Government has saved capitalism from its own internal contradictions, its structural flaws that deliver recessions and depressions every few years. But that was costly for the government to do. And the government would not tax the rich – the financiers, the businesses, the rich who have all done so much better than everyone else for the last 25 years – to cover those costs. So the government, spurred on by business and those strange “conservatives,” shifts the costs onto the masses. Say Hallelujah!

Yet the delayed, repressed, and hesitant response of angry masses has been growing, despite the heaps of ridicule mixed with media disinterest they have suffered. Hungary’s new leaders will not tolerate more austerity. Greek workers mount general strikes and clash with police and the military in an escalating conflict that will become only more intense once students return to Athens next month. The tea party folks don’t go away. France has set a general strike for September 7. All of Europe is planning a day of actions at the end of September. The AFL-CIO and NAACP are marching on Washington October 2. Something is happening here and there that suggests that the easy ride of finance and capital through this Great Recession may not last. Business and government leaders may have counted their chickens too soon. Speaking of those animals, perhaps another kind is coming home to roost as the people begin to move.