Progressive Ponderings: The "Unreal" World
by Joe Mayer
This current financial crisis that has politicos and the administration scrambling has grave importance to both our economic future and our future as a self-governing people. Bush's speech on Wednesday evening was a perfect example of why we are in such trouble financially and politically: He and his ideological mates refuse to live in the "real" world and address the root cause of problems so that "real" solutions can be discovered and put into actions.
According to the imaginary world of Bush our financial crisis lies outside Washington – overseas lenders, American borrowers overreaching, easy credit terms, a banking system eager to cooperate, and too much enthusiasm about rising home values. This unreal world of "the market solves all problems" motivated Congress and the White House to willingly turn over to the corporate world the governance of the economy that properly belongs to the people. Bush's denial of any responsibility is right in line with a philosophy of "laissez faire" omnipotence. In the Bush world, Congress, the White House, the regulators and the Fed were doing exactly what their corporate sponsors demanded and thus they have no responsibility for the suffering of American citizens.
In his unreal world "banks found themselves" (without any fault on their part) with "questionable" (debt-ridden) balance sheets and investment banks "found themselves" with toxic assets. The implications from this "found themselves" imagery is that it might have been caused by nature, by God, by hurricane Ike or "stuff happens."
The "fix" follows this Unreal analysis: Throw money at the innocent corporate "sufferers" so that they can continue to take advantage of "laissez faire" and prepare us for another faultless depression. The recently adopted Republican Platform (presumably approved by McCain) indicates that after the "bailout" the intention is to keep corporate control of Washington.
People are opposing Bush's bailout plan. But again Bush demands that only one option be considered, "you're either with us or against us," "either pass my bill or the sky will fall." In the "real" world other solutions are available. Start with requiring the holder of mortgage paper to renegotiate with homeowners on reasonable terms rather than trying to sell the paper for 40, 60, 80 cents on the dollar as has been happening.
No one knows how much junk paper is out there because of the lack of transparency with derivatives and swaps which few can explain but are basically methods of expanding leverage (risk) with the "hope" of huge profits. Enacting regulations for transparent business dealings are imperative. If the bailout proposal doesn't address this and other underlying causes we can wave goodbye to the $700 billion.
If this "bailout" proposed by Bush/Bernanke/Paulson succeeds, some corporations and wealthy individuals are going to make bushels of money. Minnesota Senator Norm Coleman stated Tuesday that the government could get back 10 to 20 times the bailout dollars (assuming that the government took an equity investment which wasn't in the original bill). Also, recall that the same was said about Iraq, that oil would pay for the war! Those talking heads will most likely be the same ones fighting against regulations and the ones responsible for this "grand theft" in the first place.
Does our government need to take some action? Yes, if it is our government speaking. No, if it's the robber barons' government manipulating.
This current financial crisis that has politicos and the administration scrambling has grave importance to both our economic future and our future as a self-governing people. Bush's speech on Wednesday evening was a perfect example of why we are in such trouble financially and politically: He and his ideological mates refuse to live in the "real" world and address the root cause of problems so that "real" solutions can be discovered and put into actions.
According to the imaginary world of Bush our financial crisis lies outside Washington – overseas lenders, American borrowers overreaching, easy credit terms, a banking system eager to cooperate, and too much enthusiasm about rising home values. This unreal world of "the market solves all problems" motivated Congress and the White House to willingly turn over to the corporate world the governance of the economy that properly belongs to the people. Bush's denial of any responsibility is right in line with a philosophy of "laissez faire" omnipotence. In the Bush world, Congress, the White House, the regulators and the Fed were doing exactly what their corporate sponsors demanded and thus they have no responsibility for the suffering of American citizens.
In his unreal world "banks found themselves" (without any fault on their part) with "questionable" (debt-ridden) balance sheets and investment banks "found themselves" with toxic assets. The implications from this "found themselves" imagery is that it might have been caused by nature, by God, by hurricane Ike or "stuff happens."
The "fix" follows this Unreal analysis: Throw money at the innocent corporate "sufferers" so that they can continue to take advantage of "laissez faire" and prepare us for another faultless depression. The recently adopted Republican Platform (presumably approved by McCain) indicates that after the "bailout" the intention is to keep corporate control of Washington.
People are opposing Bush's bailout plan. But again Bush demands that only one option be considered, "you're either with us or against us," "either pass my bill or the sky will fall." In the "real" world other solutions are available. Start with requiring the holder of mortgage paper to renegotiate with homeowners on reasonable terms rather than trying to sell the paper for 40, 60, 80 cents on the dollar as has been happening.
No one knows how much junk paper is out there because of the lack of transparency with derivatives and swaps which few can explain but are basically methods of expanding leverage (risk) with the "hope" of huge profits. Enacting regulations for transparent business dealings are imperative. If the bailout proposal doesn't address this and other underlying causes we can wave goodbye to the $700 billion.
If this "bailout" proposed by Bush/Bernanke/Paulson succeeds, some corporations and wealthy individuals are going to make bushels of money. Minnesota Senator Norm Coleman stated Tuesday that the government could get back 10 to 20 times the bailout dollars (assuming that the government took an equity investment which wasn't in the original bill). Also, recall that the same was said about Iraq, that oil would pay for the war! Those talking heads will most likely be the same ones fighting against regulations and the ones responsible for this "grand theft" in the first place.
Does our government need to take some action? Yes, if it is our government speaking. No, if it's the robber barons' government manipulating.
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