This morning, Roger Cohen wrote a really good piece in the Op-Ed section of the New York Times. It's worth reading and thinking about since we are at a point where it is being decided once again what our own government should be about. What philosophy best serves the people? What happened to infrastructure as a government responsibility?
"The leverage party’s over for the masters of the universe. Shed a tear. When you trade pieces of paper for other pieces of paper instead of trading them for real things, one day someone wakes up and realizes the paper’s worth nothing."
This wouldn't be so sad if the only ones losing money were those who were doing the gambling, but a lot of people had their future pensions in these companies. This is grandma and grandpa and younger people who have hopes to retire but not just yet. These people didn't know they were gambling. They thought the whole thing was being managed responsibly. How could they know?
Greed is one of those things that carries people along like a tide. They start out just wanting some money, then more money, then looking over and see what someone else is doing to make money. So they do it too and the next step can be a doozy where there is no turning back without a wholesale revamping or admission of wrong doing. Who wants to do that?
Cohen's point is that without government oversight and regulation, we have ended up with parts of the stock market run amok. Companies, even those with good reputations, have been gambling to increase their own profits. It worked for some of them-- if they didn't break laws to find themselves in prison like some of the Enron gang or back to the Keating 5 when the Savings and Loans went under.
For readers too young to remember McCain's role in the Keating 5 scandal, he certainly won't want to talk about it. Here is a synopsis from Slate: [Keating Five]. This is what showed up on the public, proven side anyway. McCain didn't do four years in prison as his friend Charles Keating did, he was admonished by the Senate for using poor judgment. With no paper trail to prove any wrong doing, he was re-elected and the whole thing put behind him.
Others weren't so lucky. Savings and loans went under, ordinary people lost money. The savings and loan we had our money in was sold and reappeared with a new name, but we had more loans than savings in those years. Big depositors might have lost their deposits, but they didn't forgive loans. *shucks*
You'd think after that Senator McCain might have learned that government can't turn a blind eye to what is going on in the financial markets. After all, this is where McCain would like to have some of our Social Security funds. With no oversight, what would that mean?
Government either oversees what is happening or the people are at the mercy of any swindler out there. How can we personally investigate someone like Lehman Brothers to determine if they are sound? How could we know (before this summer) that Fannie Mae was a risky investment? Even our own financial planner didn't get out all of what we had in Fannie Mae and that was not a stock that went down and might come back up. That money was lost period.
So Senator McCain, with a wife who has wealth beyond most people's imagining, says the economy is fundamentally (is fundamental a word that should alert us to be concerned?) sound. Does he know? Does he care? His economy is fundamentally sound as long as people keep drinking beer and his wife doesn't leave him.
As recently as June, McCain saw regulation as a mistake. Capitalism will police itself, no need for government oversight. Now he's talking regulation and a commission to study what has happened. A commission? Come on, when you leave the foxes guarding the chicken house what do you think happens?
7 comments:
I read Roger Cohen's Op-Ed this morning, too. Great piece. It's the "britney spears mentality" of so much of this country that drives me to distraction. You put it so well in your title, what else can we expect????
I've lost all confidence in this country. Where has Bush been during all this? Hiding under the bed??
I think the man is a pathological liar so nothing he says would make me feel better. But he at least has the obligation to get on television and explain to the country what happens next. Assuming he even has a plan, that is.
I've lost tens of thousands of dollars in the last 15 months, representing everything I had accumulated in the last 7.5 years of employment. And since most of the Wall Street gains since 2000 were built on quicksand, shady business practices, lies and scams, I don't see the market roaring back like it did after 9/11.
Osama bin Laden's wish to bankrupt the United States might be coming true.
The politicians just continue with more of the same. Yesterday Barney Frank, the chairman of the House Financial Services Committee which oversees regulation could only talk about how all of this mess was the fault of the Bush Administration and the Republicans and how we need more regulation. Why didn't he just do his job in the first place. Oh that's right he and all the other Congressmen were accepting huge campaign contributions to look the other way.
I mean this guy is a total hypocrite to blame this on anyone but himself. In 2003, Frank rejected Bush administration and Congressional Republican efforts for the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis. Under the plan a new agency would have been created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry. "These two entities, Fannie Mae and Freddie Mac, are not facing any kind of financial crisis," Frank said. He added, "The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing."
Now after he stopped regulation he is saying he wants more regulation and it is Bush's fault that we do not have it. This guy has cost the taxpayers $100Billion and now he wants more power so he gets more contributions to him.
There is plenty of blame to go around and with two Senators running for president I don't expect much to change if either one of them gets elected.
I am concerned about McCain. He should not be President !
Something definitely seems wrong with McCain and that will leave Palin president sooner than later (she is already calling it the Palin/McCain campaign). Is that supposed to be reassuring because she's an outside the beltway who has abused her power, has as much ignorance as Bush?
As for the financial mess. What the Republicans proposed was a new agency that would take oversight away from Congress. This is not exactly a guarantee this wouldn't have happened anyway given the way these agencies were often staffed with industry insiders or those without a clue. I think there is blame to go around.
What I don't understand is the Republicans are now saying they wanted more government to solve the problem in '03 (not a usual Republican stance) and several times since, and they had the presidency, the majority votes, the head of most committees for at least half that time right up until '06. Why didn't they just do it? Would another regulatory body have made a difference? I would like to see Barney Frank's take on why he didn't favor it but he was not head of any committee those whole 8 years which means the Republicans had some years during it that they could have done what they wanted and Frank couldn't have stopped them.
Right now I don't know enough about the whole thing and only find spin on both sides. There is Phil Gramm's hand on the deregulation for sub-primes (where a lot of this problem resides). Loaning money to people who couldn't afford to buy their homes with a down payment ended up making our economy look better for a lot of Bush years than it really was. But not to worry, Gramm and his buddies did fine in it and probably got out ahead of the crash. That type usually does.
The one given is that some made a lot of money off this and the ordinary person is losing a lot. I don't usually just throw away $20,000. Do you?
What I also wonder is why our financial planner was in it to begin given this supposed record of concerns going way back. That's a question for him though, not the government!
What week it's been! And yes, I think we can all thank the Republican Adm. and their lack of wanting any regulation.
CAN you imagine IF Social Security is privatized? Talk about a roulette gamble and casino. NO thank you!
Terri
http://www.islandwriter.net
PS......somebody mentioned concern about McCain. I'll tell you what....I heard him in a radio interview here in Florida....yes, the ONE where he indicated Spain was in Latin America.....and as an RN, if I were assessing this man as a patient, in all honesty, I would have to indicate that I suspect the early onset of dementia. I'm not being nasty, etc. here. THAT is my professional opinion. He has a VERY strange affect, which is what we're trained to notice. His thinking and responses are just NOT appropriate. Seriously, something is wrong....seriously wrong. Could he be following in Reagan's footsteps more than we realize?
Terri
http://www.islandwriter.net
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