Brett Arends has written an interesting article titled The Next, Worse Financial Crisis.
I can’t say I follow Brett’s logic in his first point, which is:
1. We are learning the wrong lessons from the last one. Was the housing bubble really caused by Fannie Mae, Freddie Mac, the Community Reinvestment Act, Barney Frank, Bill Clinton, “liberals” and so on? That’s what a growing army of people now claim. There’s just one problem. If so, then how come there was a gigantic housing bubble in Spain as well? Did Barney Frank cause that, too (and while in the minority in Congress, no less!)? If so, how? And what about the giant housing bubbles in Ireland, the U.K. and Australia? All Barney Frank? And the ones across Eastern Europe, and elsewhere? I’d laugh, but tens of millions are being suckered into this piece of spin, which is being pushed in order to provide cover so the real culprits can get away. And it’s working.
Anyone who has read up on this crisis would know that it was not caused by Democrats alone. Lots and lots of events and behaviors caused this crisis. President Bush also did his part. Arrents also peculiarly leaves out the Fed and their actions. Brett claims we are learning the wrong lessons but he misleads us into thinking that Democrats had nothing to do with it. Okay…
I haven’t studied enough to understand what caused the bubbles in Ireland, the U.K. and Australia but I don’t understand his logic that IF the crisis in the U.S. was caused by politicians, why they would also have caused the crisis in other countries (I hope that makes sense. I know what I’m trying to say but I’m not sure I’m getting the point across.)?
I do agree with point number four:
4. The referees are corrupt. We’re supposed to have a system of free enterprise under the law. The only problem: The players get to bribe the refs. Imagine if that happened in the NFL. The banks and other industries lavish huge amounts of money on Congress, presidents and the entire Washington establishment of aides, advisers and hangers-on. They do it through campaign contributions. They do it with $500,000 speaker fees and boardroom sinecures upon retirement. And they do it by spending a fortune on lobbyists — so you know that if you play nice when you’re in government, you too can get a $500,000-a-year lobbying job when you retire. How big are the bribes? The finance industry spent $474 million on lobbying last year alone, according to the Center for Responsive Politics.
Sadly, I don’t know how we fix this problem. We could pass laws to outlaw lobbying but I don’t know how you stop companies from dangling speaker fees in front of future retired politicians.
If you get a chance, read Brett’s piece and tell me what you think. I’d like to know what you agree/disagree with.
Have a good weekend.
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