Thursday, March 11, 2010

Stepping towards the abyss

By Don Klein

President Obama sent to Congress the outline of a bill to keep banks from dealing in the destructive practices that plunged the country into an economic abyss in 2008, but the idea seems to be dead before anyone on Capitol Hill had a chance to unwrap the envelope it came in.

According to The New York Times, "The legislation would ban banks that take federally insured deposits from investing in hedge funds or private equity funds and from making trades that are for the benefit of the banks, not their customers, a practice known as proprietary trading."

The proposal, called the Volcker Rule, was designed to keep banks which profit from the federal safety net to take unnecessary financial risks. Paul Volcker, the former head of the Federal Reserve said it had "tough" rules.

It is no wonder that tough language would be a good reason for the stalwart protectors of America’s avaricious bankers, otherwise known as the US Congress, to view such restrictions as overbearing and harsh. The fact that millions of hardworking ordinary citizens were thrown out of work because of the chaos caused by Wall Street moguls never seemed to matter.

Congress knows whose milk they suckle for nourishment and where the honey for their munchy toast comes from. When was the last time our resolute lawmakers in Washington ever did anything for the people?

The rule in Washington is not to ruffle the sensibilities of industry.
++Hold up health care until its dies a slow death in order to keep the insurance and pharmaceutical professions happy.
++Even the Supreme Court got into the act by opening the door for corporate barons to dominate elections with their heavy spending and freewheeling campaigns in support of political scoundrels.
++And Congress won’t make banks act responsibly.

Oh no, don’t do any of those things that really matter to the people. Lincoln’s spirit is tossing in its tomb. The government of the people and by the people is clearly not for the people. Today’s members of Congress probably know every one of the 13,740 lobbyists in Washington, but hardly a handful of voters. This is a moneyed crowd. If they had their way they would repeal the laws of gravity if by doing so it benefitted big business.

None of this is new. It has been growing for decades because the corrupt system imploded and right now appears to be unfixable. Senators and Congressmen have to run for office on a regular basis and that requires gifts to run campaigns. The fat cats know this and ply them with funds at every opportunity. The best politicians fall prey to this profaning process.

There is nothing more accurate than the saying, "we have the best government money can buy."

As to the Volcker Rule, members of the Senate said it "would not have prevented the financial crisis or saved companies like Bear Stearns, Lehman Brothers and the American International Group," The Times reported. " They said the idea, as outlined by President Obama, was vague and difficult to enforce."

In addition, those trustworthy servants of the country club crowd, Goldman Sachs and JPMorgan Chase, told Congress that limits on risk-taking could be achieved by other means. The obvious question remains, if there were "other means" to avoid economic disaster how come they didn’t employ them before the crash. They failed to mention that fiscal gluttony is the only motivation they understand.

The sooner we face the reality that American politics to a very large extent is controlled by big money, the better. Money always talks the loudest. In the past the public only gains when there are horrible consequences that force changes.
That was the case with the civil rights legislation in the 1960s designed to end the onerous conditions of second class black citizenry. It also happened in the 1930s with the New Deal when Americans were in dire suffering during the Great Depression.

But it doesn’t seem to be working anymore. Today’s Congress has no respect for the people who elected them. They take them for granted and seem to think that they can explain away any distasteful behavior by raising the ugly ogre of high debt or national security or any other threat to our democracy their fertile dishonest minds can concoct.

In essence Congress works for us. They are employees of the people and are the only workers I know who can spend an entire year spinning their wheels and being well paid to do nothing. They complain about the lack of regulations to control errant banking policies, then when the opportunity arises for them to do something about it, they twiddle away the effort.

They talk about the need for health care reform then spend more than a year nit-picking anything that looks to be an improvement to a bad system. They said the current health care program will bankrupt the country, but fear taking any steps to ease the nation's financial pain.

They are the most dreadful actors on the public stage. A small town alderman is more responsive to constituents than members of Congress.

Congress is in such disfavor with the American people that the independents are growing in greater numbers than the Democrats and Republicans. With good reason. Some believe the solution is a third party, but that has never worked in this country.

So this is where we stand: We live in a fading democracy, the world’s greatest debtor nation, and our government leaders are battling each other to a standoff for political advantage instead of working to improve the national condition.

If things don’t change, we may be doomed as a global force and the great American experiment will have failed. If they don’t act responsibly in the eight months left until the November elections, the self-centered loafers and should be thrown out like the bums they are.