Look In the Mirror for a Change

Our economic whirlwind is filled with such irony that the fun of sorting it out almost outweighs the pain it’s causing.

Irony #1: For years, champions of unbridled capitalism allowed banks, insurers and others to merge, resulting in financial institutions that have now become “too big to fail” – leading to a quasi-socialist system as government rescues those teetering institutions (Freddie Mac, Fannie Mae, AIG, etc.).

Irony #2: For years, champions of the underprivileged fought to end red-lining, whereby financial institutions were thought to discriminate against borrowers based upon geographic location. To end such discrimination, banks were strongly encouraged to make loans more readily available to folks with lower credit scores. Now those same champions of the poor are castigating those banks for making loans to people who couldn’t afford to repay them.

Irony #3: We, who weren’t complaining back when first the Nasdaq and then the values of our homes were rising to unsustainable levels, are now wondering why someone didn’t do something earlier to prevent today’s carnage. The answer is simple – because we wouldn’t let them.

Therein lies another irony. For all the blame we want to place – and on a political site such as this, it’s practically a foregone conclusion where that blame will be placed – the real blame lies with us. If the economy slips one measly percentage point we have a collective cow and start shouting for someone to do something. If “they” don’t, we want “them” thrown out on their ears. We call them out of touch and heartless and beholden to the special interests. Because they don’t want to lose their jobs – and because voters are the most precious special interest of all – they do something.

In 1998, when the Russian and Asian credit crisis threatened a worldwide financial collapse, “they” engineered a bailout of Long Term Capital Management and the bull market of the 1990’s continued on its merry way - and we were happy. When that bull market came crashing down in 2000, “they” cut interest rates and taxes so the economy wouldn’t fall into a recession - and we were happy. That easy money created a housing bubble which also crashed, so “they” take over mortgage lenders and insurance companies and arrange marriages between investment banks - and we are happy (for about a day). Our Hummers and Expeditions and Suburbans get too expensive to drive because our demand for oil knows no bounds, so “they” send us rebate checks - and we are happy (for about a week).

But eventually, “they’ll” run out of money and we’ll demand they do something. Then, and only then, will we realize that “they” are us. For all the calls for change this election season, the most important change needs to be among those of us who do the electing. But that’s not the change we want, which may be the greatest irony of all.

Full article: Look In the Mirror for a Change

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