Let me see. I think I'm beginning to understand. Wall Street, the largest banks, and the politically active ultra, ultra wealthy like the Koch brothers get Congress and the SEC to deregulate financial speculation more and more year by year, repeal the Glass-Stiegel Act, and allow the 5 largest investment banks to increase their leverage to 40 to one. By separating traditional banking from investment banking Glass-Stiegel had prevented banks from gambling with their depositors' money. Thanks to our bought and paid for government leaders of the recent past, now they can and did. Forty to one leverage is like allowing the average investor like you and me to buy stocks at 40 to one margin. It means for every dollar put in by the likes of Goldman Sachs they stand to win or lose $40. Incredibly high rewards, incredibly high risk. And who pushed for it? Why Hank Paulson, the former Goldman Sachs CEO who became our Secretary of theTreasury. Government of the greedy, by the greedy,and for the greedy. Talk about setting the fox to guard the chickens.
So Wall Street and the largest banks take a lot of our money, money we’ve put in bank accounts, pension plans,money market funds, mutual funds, equity we have put into our homes by mortgaging our earning power - on a wild trip to Las Vegas, no expense spared . Finest hotels, finest food, oodles of champagne, virtually unlimited expense accounts and multimillion dollar salaries for the gamblers. What a party! What exciting gambling. And what a deal! If they win, they win fabulous wealth and they keep the money. If they lose they lose, they can find a way out. What’s to lose? Talk about providing an incentive for recklessness.
Ok, so these guys are in Las Vegas being paid to live the life, and they loose big. I mean real big. Their gambling debts are so large they have never been seen before in human history. So when their IOU’s come back they say, “Hey, these could put us out of business.” And who would want to go out of a business like theirs?
Now I understand that extortion is defined as “the act of obtaining money by force or threats.” So these guys say, “Why don’t we just extort billions of taxpayer dollars from Washington? That will keep the party going. All we have to do is to threaten that if we don’t get the money, the entire economy will fall apart.” And that may or may not have been true, but it’s the closest thing to legal extortion. If you don’t want to call it extortion think of it as holding the entire economy for ransom.
And it works! The debts come due and several things happen. Billions of dollars of money the average person has sweated for goes to pay for the astronomical gambling debts. What the heck, why don’t we pay for the party and pay the people that lost the money million dollar bonuses while we’re at it? The economy goes into the worst recession since the Great Depression. As the financial bubble bursts, millions of people pay for the party by losing lose their jobs, homes, health insurance, and pensions. Millions of small businesses go bust. Local government loses its tax base.
So how do we fix this god-awful mess left from the most lavish party in history? I know! We can rebalance the local government budgets by cutting the salaries, benefits, and collective bargaining rights of those fat cats, municipal employees. We can dismantle the programs that give the non-wealthy a safety net. We can cut the school programs that give the non-wealthy the education they need to make it in this high tech world. Someone has to pay the piper. And in fact everyone pays for it in one way or another, except those responsible for it.
So what is the answer? Mass peaceful protests like the “Spanish Revolution.” Mass protests got us the Civil Rights Act. Mass protests got us out of Vietnam. Mass protests organized through social media like Facebook are removing the despotic regimes of the Middle East. Are Egyptians that much more creative with social media than we are?
Does anyone out there know how to gather a flash mob? Does anyone out there know how to make the Capitol Rotunda and Times Square look like Tahrir Square?
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