With all of the talk of who is to blame, there are a lot of smart people saying what many of us deep inside already know. None better than Neal Boortz, who is the co-author of the “FairTax” book, explaining in his “talk to me like I’m a 4-yr old” style, how the financial markets got into this mess in the first place: Political correctness run amok.
Right now this crisis is being sold to the American public by the left as evidence the failure of the free market and capitalism. Not so. What we’re seeing is the inevitable result of political interference in free market economics. Acme bank didn’t want to loan money to Joe Homebuyer because Joe had a spotty job history, owed too much money on his credit cards, and wasn’t all that good at making payments on time. The politicians told Acme Bank to figure out a way to make that loan, because, after all, Joe is a bona-fide minority-American, or forget about opening that new branch office on the Southside. The loan was made under politicial pressure; the loan, with millions like it, failed – and now we are left to enjoy today’s headlines.
Ironically, what has classically scared me about stupid people who don’ t know anything about economics running our economy (by fleecing rich people and making sure companies don’t make too much money), doesn’t scare me QUITE as much as the Government’s insistence that noone should be at risk of losing money. Combine the two, and you have a managed economy.
Meanwhile Steve Forbes defines another large chunk of the problem:
Not even during the Great Depression did we witness what is now unfolding–a sizable number of big financial institutions going under. What enabled their taking on so much debt and so many questionable assets was, primarily, the easy-money policy of the Federal Reserve. Chairmen Alan Greenspan and Ben Bernanke created massive amounts of excess liquidity. If the dollar had been kept stable relative to gold, as it was between the end of WWII and the late 1960s, the scale of the bingeing in recent years would have been impossible.
I feel like I’m SMACK DAB in the middle of an Ayn Rand novel.