Blog

On the financial crisis of financialness

Sep 22, 2008 • Karen

Required reading for everyone ever: "REQUEST FOR URGENT CONFIDENTIAL BUSINESS RELATIONSHIP"

I don't know enough about the US financial system (either what it is currently or what it should be) to say what should be done about the current crisis, if anything. I did happen to take one class on the intersection of the Fed, Wall Street, and the corporate elect. Doesn't really help much. I'm not an econ major--and even the vast majority of econ majors don't understand the nitty-gritty of finance any more than I do.

But:

1.) Do you really think most of Congress has any more expertise in this area than you or I do? Hell no! Congresspeople tend to be buddies with investment bankers, but they usually weren't ones themselves. (Not that I would necessarily trust their judgment any more if they were.) Yet Bush and Paulson are quite forcefully shoving this bill down their throats--they're trying to pass it this week. Do you trust your congresspeople to actually understand this crap and make an intelligent decision about it within days? Then I've got a mortgage to sell you.

Congress is very good at passing stupid, short-sighted bills even under ordinary circumstances, don't get me wrong. But it's even better at it when those bills come with 1.) such short development times that no one really knows what they're voting on and 2.) vague but exceedingly dire threats. Hey, it's the financial PATRIOT Act, sans sunset clause! Woo hoo!

None of this gives me even a shred of confidence that passing this thing is a good idea.

2.) If I just accept my minimal level of background knowledge, if I had to make a decision about what to do about the current crisis, you know what my instinct is? It's "Let the buggering chimps hang." It's "Moral hazard ends here, you whiny, depraved pseudocapitalists!"

It is most definitely not "You want us to print ONE TRILLION DOLLARS in play money and bury Wall Street in it? Okay!!" Well...maybe. If it meant they'd suffocate underneath.

And the Democrats' response is so sad. I know, I say that about...virtually anything the Democratic Party does. Just a long, voter-turnout-deflating series of spineless, half-hearted, pathetic reactions. But in this case it's like they're on a vaudeville stage, playing the role of Liberal Stereotype:

White House: "Gimme money. Lots and lots and lots of money. Or else the financial system will explode and EVERYONE WILL DIE and the TERRORISTS will WIN. ...Wait."

Democrats: "Uhh... Let it be said for the record that this is stupid and we don't like it. But fine. You can have all the money you like. So long as we get to regulate."

White House: "Regulate what?"

Democrats: "Regulate...you know...stuff. Stuff so this won't happen again. Yeah."

White House: "Wait, so you're making kneejerk demands for regulatory power...even though you don't even know what in the hell you should do with it? Jesus Christ, is this the Rush Limbaugh minstrel show?"

Yes. Yes it is.

I mean, my heart might be spotted with the dark taint of liberalism and all, but generally I'm still not in favor of regulation for the hell of it. I prefer the establishment and use of government power when it has a point, at the very least. Yet because Congress doesn't know shit about the financial system, that's pretty much what they're asking for. A blank check for regulation in exchange for a literal blank check.

I could be convinced, by well-evidenced argument, that the financial system needs some more or different regulation. As a liberal, I believe it is possible, theoretically, for Congress to pass halfway decent financial regulation laws. But, again, not in a frickin' week.

After all this, if I meet anyone who voted for Bush and whines about tax-and-spend liberals or how social programs cost too much, I will punch them in the mouth.* Seriously. "My" (ha ha, no) party might be a bunch of two-faced pansies, who will inevitably come around to voting for this dangling piece of dog dung, but they didn't come up with it. They didn't ask for--nay, demand--the power to dump one *trillion* dollars into the economy to bail out the supposed captains of capitalism. Or start an unnecessary war. Or to make (given all of the above) the most irresponsible tax cut ever. Or the many other neocon projects that have created a runaway deficit that will at this point probably sink this damn country.

At which point, yes, like the millions of un- or under-employed college grads out there who are up to their neck in student loans, there really won't be any room in the budget for silly luxuries like health care or education. Just interest payments. Thanks.

* Those of you who actually voted for the Libertarian presidential candidates: please feel free to continue doing so.