Why Is His Face On The 20 Dollar Bill?

I am half way finished with Jon Meacham's recent book, American Lion, which is a biography and analysis of Andrew Jackson's life and legacy. Andrew Jackson is fascinating President and he does not receive attention that is proportional to his importance to our Body Politic. His rise to the presidency alone is fascinating. He grew up in relative poverty yet he managed to get a surprisingly good education through country schools and through the Presbyterian church, where he learned his gift for oratory. Although he read Plutarch, quoted Julius Caesar and knew a good deal of "the Dead Languages" he was not as formally educated as the other 19th Century Presidents. John Q. Adams and other rivals never let him or the public forget that, despite the fact that Jackson outsmarted them all, ultimately.

His time in office is interesting all on its own merits but what makes his story so compelling is the impact that he had, for better or for worse, on this young and still very malleable Republic. This Frontiersman/Lawyer/General/Member of the Provincial Gentry was the American version of a tribune of the Plebs, the office in the old Roman Republic that was created ostensibly to protect the interest of the common man in the face of the Aristocratic Senate. Andrew Jackson was the first strong president, he was the first to believe that he, being the closest thing to a ntionally elected official should make the White House just as important as Capitol Hill.

The proceeding fifty years set the stage for his pivotal and oft embattled eight years as President. The Constitution of the United States was meant to curtail the force of the popular will. In the late 18th Century most states required that one be white, male, protestant and own property in order to vote. While the latter two restrictions actually began to disappear relatively quickly, it did not matter very much because almost everyone in Washington, save for members of the House were indirectly elected. State legislatures elected the independent electoral college members and they elected the Senators and as is the case today, Federal judges were appointed and confirmed all by a President and Senate who were all unelected.

When Jackson comes to Washington he came with a belief that since he was only official elected, albeit indirectly, on national level that he must be the voice of the common man and viewed the relationship between the Congress and the President as adversarial. Those in the Senate considered him a tyrant and usurper, who wanted to make himself King. Jackson asserted that the real tyranny was already established, a Central Government that was essentially unelected. This conflict of ideas illustrated to me what I already knew about politics, with respect to policy, there is no perfect path to take, no silver bullet, there are only trade offs and hopefully government will at least maximize what it can do given the constraints that it faces.

This story of the Battle between President Jackson and the elite Senate, Courts and Financiers and there attempt at establishing a Central Bank, among other things, demonstrates that when it comes to questions of procedure, there is no perfect answer either. Just as there are policy tradeoffs, there are tradeoffs with regard to how power is shared, how it is checked, how it can be exercised and who elected and/or appoints and confirms whom.

Once again the book is well written and the story is compelling but for me president Jackson's time in office and his attempts, successful in many respects, to change the focus of power across the country and within Washington and the fact that his supporters and detractors both claimed that they wanted as robust as possible a check as possible on tyranny shows that even when we agree on our goals, structuring a political system to achieve a particular end faces tradeoffs and the decisions made in the face of those tradeoffs is what makes politics so fascinating, particularly politics as they unfolded during the Age of Jackson.

A House of Horrors

Recently, I read a list of the most stressful cities in America and a big part of determining the rankings was how much property values have declined in the last 12 months. This fact, the fact that a decrease in home prices cases widespread stress proved to be the final straw, the final nudge towards an epiphany.

A combination of financial practices and government subsides and other incentives have created a situation where any decline in home prices causes stress and misery on a large scale. This is why, I fear that this current downturn will not be unique and will recur several times until government and private actors move away from the mindset that homes are like commodities in which individuals should speculate in the short run. Rising assets prices are generally a good thing, in the case of real estate, it means that a community is growing and becoming more vibrant and for that reason that home buying was, in previous generations, seen as a very safe and passive long term investment. Home prices would rise and fall year fater year and a decline in prices for few years was not a serious matter unless you absolutely had to sell during those years.

Unfortunately government subsidies, Freedie and Fannie and willing financial firms, loan officers and home owners and perspective home owners allowed much of the economy to be partially if not completely dependent on not only yearly increases in home prices but double digit appreciation and without it, well without it, we have seen the devastation it has caused.

Policy makers need to change the incentives to make the US economy less vulnerable and subject to deep recessions whenever real estate prices fall. Prices need to fall to clear the market and from a social stand point, to make it possible for a new generation of married couples and young families to get homes and to do so with mortgages that do not depend on refinancing every few years.

Homeowners have a large amount of political power and want a restoration of the status quo but for the sake of the economy, the sake of the future and the for the sake of stability we need to change the incentives that caused the distortions that caused the malinvestment, which created all of the jobs and fortunes which simply cannot withstand the inevitable declines in real estate prices. Not having your job, the life of your community the viability of your mortgage bein gat the whim of yearly fluctutions in home prices would make communities across America much less stressed.