In all this Wall Street bailout mess, many offensive words have been spoken, but nothing like the refrain from the many Republicans and Democrats who voted against the financial rescue plan. Over and over, these blowhards told us they were standing on principle. It’s not the job of the government to bail out the irresponsible Wall Street CEOs.
This argument, typical of politicalspeak, is neither principled nor true. The bailout is not intended to protect CEO money. The money that has disappeared from the market is not, and never was, the bankers’ money. To say so is the miss the point of the whole scam: Bankers were gambling with someone else’s money – with our money – and they have lost it. Obviously, if the money were only the bankers' money, there would be nothing to worry about. But with the money gone, banks have nothing to lend, which means a crushing credit crisis is coming that will make it impossible for businesses that rely on credit to maintain inventory to survive. Forget the CEOs; they probably have the money they made stashed in gold bullion in Madagascar. We have to save our credit system, or 20% of us will be looking for work by next fall.
What really irritates me is not the misreading of the crisis, which is probably intentional and politically motivated, but the suggestion that opposing the bailout is somehow principled. Principled? At the eleventh hour, when Wall Street is on fire and the entire world wonders what stupid predicament the Americans have gotten them into this time, suddenly politicians find principle. This is like a bunch of johns complaining that somebody took the Gideon Bibles out of the rooms at the whorehouse. The time to get principles was a long time ago, when they were busy passing all the laws that made this predicament possible. But now? After they’ve finished with the hooker and are zipping their pants up, now they get ethics.
Please. Where was Congress the last 2 years while this train roared out of control? Who raged about unsafe lending practices in 2006, probably the last moment this crisis could have been avoided? Not Congress. Congressmen and women were too busy letting lobbyists from the financial industry stuff money in their pockets to worry about little stuff like that. I wonder if Congress is angry because the American people got screwed, or because politicians realize they won’t have financial companies underwriting their campaigns any longer.
Reel this horror movie back to 2005. Then, President Bush signed a new bankruptcy bill that made it more difficult than ever for private citizens to declare bankruptcy. This law was written by MBNA, one of America’s largest credit card companies. The banks thought that by closing loopholes and making it harder for consumers to go Chapter 11, they would shore up their balance sheets. What happened instead was that banks, now confident that borrowers could not renege on their debts in bankruptcy court, started issuing more credit to people who had no business borrowing. Thus the result of the 2005 bankruptcy reform was a flurry of borrowing, as people borrowed ever more money to pay the debts they couldn’t legally escape from. The end result wasn't fewer bankruptcies, it was more catastrophic ones. After a brief lull in early 2006, bankruptcies rose to the highest rates in 20 years by 2007, the only difference being that people going through bankruptcy now have to face more onerous terms.
Certainly, bankruptcy reform was not the sole cause of the current crisis. But it was one of the long fuses that would eventually result in last two week’s detonation. And this fuse was wrought almost entirely of corruption. The new bankruptcy law was written entirely by lobbyists, with no meaningful input from consumer groups. As a private citizen I was not aware that I had the right to write legislation, but apparently banks do. One could blame the banks for this law, but Congress passed it, and the President signed it. Fingerprints don't lie.
Given all this, it is frustrating to watch members of Congress claim Wall Street made this mess. Congress is at least as guilty as Wall Street.
I am a pretty moralistic person, but even I’ll admit that there are times when the fine points of ethics need to be put aside. You can be against killing, but the time to decide that is not when you are in a trench, gun in hand, facing an enemy who has fixed bayonet and is charging. The time for ethics is at the beginning, beforehand, when tempers are cool and there is freedom to think. When a crunch hits, especially one that was brought on by your perdition in the first place, the first thing you do is extricate yourself from the mess in one piece. Then you worry about the fine points of ethics.
Good ethics is a foundation. It stands on the ground, in connection with Mother Earth. It cannot be conjured in the air, and people who try to do so debase themselves and the very principles they profess. For the members of Congress who play the morality card now, the principles they so lyingly claim to profess are nothing more than trophies they can keep in the closet until everything goes to hell, then buff them up and bring them out in a desperate moment to separate themselves, just one more time, from responsibility.
This argument, typical of politicalspeak, is neither principled nor true. The bailout is not intended to protect CEO money. The money that has disappeared from the market is not, and never was, the bankers’ money. To say so is the miss the point of the whole scam: Bankers were gambling with someone else’s money – with our money – and they have lost it. Obviously, if the money were only the bankers' money, there would be nothing to worry about. But with the money gone, banks have nothing to lend, which means a crushing credit crisis is coming that will make it impossible for businesses that rely on credit to maintain inventory to survive. Forget the CEOs; they probably have the money they made stashed in gold bullion in Madagascar. We have to save our credit system, or 20% of us will be looking for work by next fall.
What really irritates me is not the misreading of the crisis, which is probably intentional and politically motivated, but the suggestion that opposing the bailout is somehow principled. Principled? At the eleventh hour, when Wall Street is on fire and the entire world wonders what stupid predicament the Americans have gotten them into this time, suddenly politicians find principle. This is like a bunch of johns complaining that somebody took the Gideon Bibles out of the rooms at the whorehouse. The time to get principles was a long time ago, when they were busy passing all the laws that made this predicament possible. But now? After they’ve finished with the hooker and are zipping their pants up, now they get ethics.
Please. Where was Congress the last 2 years while this train roared out of control? Who raged about unsafe lending practices in 2006, probably the last moment this crisis could have been avoided? Not Congress. Congressmen and women were too busy letting lobbyists from the financial industry stuff money in their pockets to worry about little stuff like that. I wonder if Congress is angry because the American people got screwed, or because politicians realize they won’t have financial companies underwriting their campaigns any longer.
Reel this horror movie back to 2005. Then, President Bush signed a new bankruptcy bill that made it more difficult than ever for private citizens to declare bankruptcy. This law was written by MBNA, one of America’s largest credit card companies. The banks thought that by closing loopholes and making it harder for consumers to go Chapter 11, they would shore up their balance sheets. What happened instead was that banks, now confident that borrowers could not renege on their debts in bankruptcy court, started issuing more credit to people who had no business borrowing. Thus the result of the 2005 bankruptcy reform was a flurry of borrowing, as people borrowed ever more money to pay the debts they couldn’t legally escape from. The end result wasn't fewer bankruptcies, it was more catastrophic ones. After a brief lull in early 2006, bankruptcies rose to the highest rates in 20 years by 2007, the only difference being that people going through bankruptcy now have to face more onerous terms.
Certainly, bankruptcy reform was not the sole cause of the current crisis. But it was one of the long fuses that would eventually result in last two week’s detonation. And this fuse was wrought almost entirely of corruption. The new bankruptcy law was written entirely by lobbyists, with no meaningful input from consumer groups. As a private citizen I was not aware that I had the right to write legislation, but apparently banks do. One could blame the banks for this law, but Congress passed it, and the President signed it. Fingerprints don't lie.
Given all this, it is frustrating to watch members of Congress claim Wall Street made this mess. Congress is at least as guilty as Wall Street.
I am a pretty moralistic person, but even I’ll admit that there are times when the fine points of ethics need to be put aside. You can be against killing, but the time to decide that is not when you are in a trench, gun in hand, facing an enemy who has fixed bayonet and is charging. The time for ethics is at the beginning, beforehand, when tempers are cool and there is freedom to think. When a crunch hits, especially one that was brought on by your perdition in the first place, the first thing you do is extricate yourself from the mess in one piece. Then you worry about the fine points of ethics.
Good ethics is a foundation. It stands on the ground, in connection with Mother Earth. It cannot be conjured in the air, and people who try to do so debase themselves and the very principles they profess. For the members of Congress who play the morality card now, the principles they so lyingly claim to profess are nothing more than trophies they can keep in the closet until everything goes to hell, then buff them up and bring them out in a desperate moment to separate themselves, just one more time, from responsibility.