What has happened to the great ship we call the USS United States? Two years into the Greatest Recession Since the Great Depression (GRSGD) and it seems the best solution coming out of Washington to return our ship to glory is to pass a financial reform bill that missed the mark and to extend benefits to our unemployed masses, further driving us into debt. Now what kind of morale booster and overhaul is that?
For two years we have been told that the GRSGD was a result of our spending too much of the world’s precious capital on “Toxic Assets”. However, when the GRSGD was first gaining its legs, U.S. companies like Intel were making advanced computer chips, Medtronic life-saving technologies, Microsoft software, Google innovative search engines, McDonald’s hamburgers, Ford cars, Apple iPods, and numerous small businesses services and products efficiently and effectively.
The products and services that these companies were producing were not toxic assets. In fact, when the GRSGD first started there was nothing wrong with the critical parts to the engine that drives our American ship of enterprise—capitalism was working. And so was globalization.
So what were these “toxic assets” that our leaders always refer to that almost took our ship and many of the world’s other ships down to the bottom of the ocean? We have been led to believe that it was mortgage-backed securities, derivatives, and the way we went about funding our housing. This is an outright lie.
Sure, we had and still have problems with the debt we created associated with housing in the United States. I have documented that myself (see my articles on the abuses of Fannie Mae and Freddie Mac, for example), but that on its own does not explain the cause of the GRSGD. The numbers simply do not explain the cause for our ship’s grounding.
Regardless of what we have been told to believe, most American homeowners have continued to pay their debt obligations—statement open and closed.
If the truth was really told, the toxic assets that stalled the USS United States were not our housing, but our financial and political leaders, and the financial system itself—not just on Wall Street, but in Washington, too. Especially Washington (Republican and Democrats alike).
Everyone knows that finance does not drive innovation. If it did, then why are we so concerned about falling behind the rest of the world in the areas of maths, science, and engineering? We surely have enough financiers and economists in Washington and New York to make up for any lack we have in those areas.
I am not advocating that we throw “the baby out with the bath water”, fire every financier in the current system, abolish the Federal Reserve, start over from scratch, and completely revamp the entire financial system within the United States. That would be reckless, and it would not make practical sense.
I am, however, saying that we do need to start holding some of our financial and political leaders accountable. If we did that, then we might instill ethics and reason back into the system and help the financial sector of our country understand the difference between greed and contribution—and maybe in the process help it gain some perspective and common sense within itself.
It does not take a rocket scientist or a nuclear engineer to understand the problems we have in the engine room. All we have to do is look around. The same people who were in charge before our ship began to flounder and the GRSGD first began are still in charge of our ship. We are at war, and the war is called the Greatest Recession Since the Great Depression. It is time for new ideas and new leadership and the best place to start is right at the top, and that means the Federal Reserve and the Department of the Treasury.
Lincoln changed his generals to win the Civil War. It is time for Obama to do the same so we can conquer the GRSGD. Obama’s waiting another six months for Ben Bernanke’s assessment on how to fix our engine problems is like Lincoln waiting for McClellan to take Richmond. It just does not make any sense. (And with full disclosure, I am an ex-naval officer and a registered democrat, who now considers himself an Independent).
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