The Basics of the Financial Crisis: How We Failed Future Generations.

 

            Equality of opportunity was never meant to be construed as equality of outcome as many 60,s generation baby boomers have done.  A market economy and capitalism has many different levels that are inherently unfair, or scrupulously fair, depending on how you look at things.  People are rewarded according to what they produce and how much of a market they can create for themselves and those with low ambition or with handicaps, such as autism, will necessarily command lower wages in such a system. This is economic law and you can condemn it with various social justice mantras but it remains economic law.

The Baby Boomers took to socialism in collage, while they were busy ignoring their stodgy establishment professors, burning bras and draft cards, and feeling guilty for all the gifts they received by the hard work of their forbears. It was the greatest generation who made an economy where their kids could be educated and prosper, according to their gifts, and determination. They gave their kids, the thankless Boomers, a CHANCE at a better life not a guarantee.  They set up a system where more people than ever before had a CHANCE at a better education and a better life but the only guarantee was “Life Liberty and the Pursuit of Happiness”. 

            The Baby Boom 60’s generation has misconstrued the CHANCE of a better life for the RIGHT to a better life. You have a right to Life Liberty and the Pursuit of Happiness;  not a right to free Health Care,  a Home,  a Car,  free sexual expression,  social acceptance no mater your behavior,  to free education, and to Pensions,  free drugs, and to be protected from trans-fat in Kentucky Fried Chicken. This is not to say that access to medicine, a pension, education, housing, health care, and even a bite of KFC once a year, is necessarily a bad thing; these are good things.  They are things to strive for: not things to which everyone is entitled. 

            Then the Baby Boomers, the 60’s types, misconstrued the word FREE and tried to sell this word as the holy grail of public policy.  Everyone should have free cradle to grave entitlements because they were owed this as a basic human right. It’s not that you should have FREE health care it’s that health care should be free because it’s a basic human right to have it.  The Boomers saw government, with all the money it could take from its citizens, as an unlimited piggy bank to which it could outsource its Christian Duties to the poor, free of charge, while the boomers pursued other questionable avenues of happiness from the sexual to the psychedelic.

In a just society, they reasoned, government should take care of everyone because everyone has human rights.  They reinvented a Roman saying about bread and circuses being a right of the people.  There is a basic law of life that affluent societies have tripped over for as long as we’ve had recognizable society: there’s no such thing as free. 

Baby Boomers have refused to face the fact that free health care, educations, mortgages, fill in the issue, is in fact health care, education, mortgages THAT SOMEONE ELSE PAYS FOR. Why should I pay for the health care of a smoker?  Why should I pay for the health care of someone engaging in high risk behavior?  Why should they pay for my health care if I’m over weight?  Once you get into why you should pay for your neighbor, who like you and I is a compellation of his or her choices in life, the issue gets very complicated indeed and it quickly breaks down.

Why should someone who doesn’t work as hard as you make the same as you?  If all work is honorable why must we all go to college when we need janitors far more than women’s studies professors? We need plumbers as well as math teachers and we need doctors as well as basketball players. Within these occupation is a wide variation in skill sets, and education, but most would contend that they’re all have a role in our society.  All of them represent choices about how different people make different decisions and reap different rewards and have different tradeoffs. The outcomes are not the same by any stretch of the imagination but the outcomes were never intended to be the same until the Baby Boomers discovered “Social Justice”.  The opportunity to develop into any of these things by your effort and work is what the founding fathers of this nation gave us.

From the time of his election in 2001, the Bush Administration has been warning congress about Fannie Mae and Freddie Mac.  These quasi government organizations were pressured by the congress to buy up loans made to people who couldn’t afford them in an effort to have 60’s style social justice where everyone gets a home, as a basic human right, and no attention is paid to their ability to pay for it or maintain it. Congress was warned by former Fed chief Allan Greenspan in 2005 that if they didn’t stop it they would have a situation exactly like this one we face today.  Over and over they were warned but the baby boom liberal congress members clung to their ideology about themselves, and government, rather than facing the facts squarely.  Of course you don’t loan to people who repay the loan!  If you do: you go bankrupt and that’s true if you’re a hardware store owner in Minneapolis or a United States Congressman in Washington.  Even the government can go bankrupt and see its money become toilet paper overnight.  The result is that the people they were trying to help, as well as the people who did it right,  pays a terrible, painful, agonizing  price.  The reward of the people who worked hard, increased their skills, and gave to their churches, paid taxes ,and lived within their means: is financial devastation because Baby Boomers won’t admit that their ideology is not the truth.

Mortgage lenders would not have given mortgages to people who couldn’t afford them if there were not a willing Government sanctioned market in Freddie Mac and Fannie Mae to buy them.  Even the most stupid individuals would not have gone after these mortgages if the government did not buy them!  Not only did the government buy bad mortgages they encouraged those who could not afford them by telling them it was their right to have a great home regardless of their means.   With the Quasi Government implied guarantee behind Freddie Mac and Fannie Mae, the Banks and Financial institutions bought their paper, as well as foreign governments, thinking the investment, being government backed, was as sound as a dollar.  As I study this “crisis” I must conclude that this is entirely of the governments making from the role of Baby Boom Radical Liberal politics to the failure to update necessary regulations as our financial system evolved, to the partisan delays in congress, right now , on the rescue package. 

Washington politicians like Barney Frank, Nancy Pelosi, Harry Reid and Chris Dodd are pontificating right now, and loading this bill up with more and more pork, to their pet constituents: while the United States teeters on the edge of a depression that’ll  make the 1930’s look like a folk dance. Washington Politicians are DOING NOTHING ABOUT THE ENERGY CRISIS AND DEVELOPMENT OF ANY AND ALL ENERGY SOURSES POSSIBLE!  Do they think the energy crisis is just going to go away?  Washington Politicans are doing nothing as China stops lending to USA banks because they no longer think their money is safe or that we’ll pay them back!  The Washington Politicians allowed the creation of the Federal Reserve who has huge impact on our economy, if not outright control, in defiance of our constitution and with calloused disregard that the Fed has its own interests and allegiances that have nothing to do with our national interests. Washington Politicians are lecturing Wall Street on fiscal sobriety and good judgment when Washington created the problem and is so bankrupt both fiscally and morally that at this late hour they’re likely too late to solve this crisis.

Consider this from Reuters:

BEIJING, Sept 25 (Reuters) – Chinese regulators have told domestic banks to stop interbank lending to U.S. financial institutions to prevent possible losses during the financial crisis, the South China Morning Post reported on Thursday.

The Hong Kong newspaper cited unidentified industry sources as saying the instruction from the China Banking Regulatory Commission (CBRC) applied to interbank lending of all currencies to U.S. banks but not to banks from other countries.

“The decree appears to be Beijing’s first attempt to erect defences against the deepening U.S. financial meltdown after the mainland’s major lenders reported billions of U.S. dollars in exposure to the credit crisis,” the SCMP said.

A spokesman for the CBRC had no immediate comment. (Reporting by Alan Wheatley and Langi Chiang; editing by Ken Wills)

Now consider this from The Washington Times:

In the dark of night over the weekend when most people were snoozing, the Treasury dramatically expanded its bailout plan to include buying student loans, car loans, credit card debt and any other “troubled” assets held by banks.

The changes, which were included in draft language that also opened the bailout program to foreign banks with extensive loan operations in the United States, potentially added tens of billions of dollars to the cost of the program.

Although it was a major addition to what was already the nation’s largest-ever bailout, it did not become part of the debate between Democrats and the Treasury over details of the program. A Monday counterproposal by Senate Banking Committee Chairman Christopher J. Dodd included such consumer loans as well as mortgages, just as the Treasury’s draft did Saturday night.

Such a large takeover by the government will surely be accompanied by adverse, unintended consequences,” said Pat Toomey, president of the Club for Growth, a conservative advocacy group. “Already, other companies and industries are lining up at government’s door asking for their own bailout.”

I could go on, and on, but you get the picture. 

How did we get here?  We got here by listing to the liberal ideology of the baby booms fantasies of how the world should work instead of focusing on the facts of how the world does work.  We got here by letting the liberal indoctrination of our schools go unchecked  while we allowed the Jewish and Christian values, that are our heritage, be maligned and marginalized until we lost the ability to tell right from wrong as well as  true from false.  We did this by empowering all this liberal stuff that sounds great at the expense of using our heads and making sound judgments about public policy and elected officials.  We did this to ourselves and the cost is going to be unimaginable.

Advertisements

2 responses to “The Basics of the Financial Crisis: How We Failed Future Generations.

  1. By ignoring the teachings of our forefathers and thinking we knew better than they did. My parents and grandparents saved and did without to get what they had. My grandparents did the same. My generations was spoiled into having now and not saving for what they wanted. The govt. come along and then handed them more. Now they think we should just give them more cause they are in trouble. Now it has got to stop!!!!!!!!!!!1

  2. Very informative article and so true…Everyone spends, buys and does whatever…Saving is a lost art…self indulgence is in…for sure…

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s