As America collapses, here`s my bipartisan list of first tier culprits: George W. Bush, Dick Cheney (has anyone seen him lately?), Senate Majority Leader Harry Reid, House Speaker Nancy Pelosi, Treasury Secretary Henry Paulson, Federal Reserve Board Chairman Ben Bernanke.
To that group, I add presidential candidates Barack Obama and John McCain. The Republican and Democratic nominees stand exposed as inept as those who they hope to replace.
Congress and the White House have demonstrated complete powerlessness to instill in a nervous America the smallest kernel of assurance in their leadership. They have shown not the slightest inkling as to how to control the financial crisis—let alone resolve it.
Their collective failures are the
biggest contributor to
As an example of their shared stupidity, consider the audacity of Paulson to appoint a former Goldman Sachs colleague, Neel Kashkari, to save our hash.[Neel Kashkari, the $700 Billion Dollar Man, by Gilbert Cruz, Time, October 8, 2008]
Yet no one in Congress objects to putting an investment banker in charge of saving the financial markets—which the bankers themselves thoroughly destroyed. Talk about adding insult to injury.
According to a CNN/Opinion Research Corp. poll, 60 percent of Americans think that a full-scale depression looms.
Of course we do! With clueless leaders spouting scare talk all day and all night, only the bravest of us can keep the faith. What`s surprising is that no one has jumped out the window..
The best thing everyone in
The crisis of confidence in American government is one of the most important forces driving down the markets.
As long as the players remain the same, bailouts and massive cash infusions will not save us. Rather than stabilizing, the problems are spreading throughout the globe.
The Wall Street massacre is the final straw in American`s long disillusionment with Bush and Congress.
Nearly 80 percent feel that unless it
gets better leaders, the country will decline, while 51
percent believe that the
And about two thirds say that today`s leaders pale in comparison with those of 20 years ago when Ronald Reagan was still in the White House.
The tragedy is that in
They were universally ignored.
William Isaac, the chairman of the Federal Deposit Insurance Corp. from 1981 to 1985, is adamant that banks do not need taxpayer bailouts but instead require accounting and regulatory policies that will give them time to work through their bad loan portfolios.
Certain that the current bailout will be a failure, Isaac proposed instead what worked during the saving and loan debacle—the "net worth certificate" that eliminated a $100 billion insolvency at a cost of only $2 billion to taxpayers.
The goal was to implement a program to ease the fears of depositors and other general creditors of banks as well as to keep tight restrictions on short sellers of financial stocks
Here`s how it worked.
The FDIC purchased net worth certificates in troubled but salvageable banks. Participating banks agreed to strict supervision from the FDIC, including oversight of executive compensation of top executives.
Little taxpayer money was involved. Instead the FDIC paid for the net worth certificates by issuing senior notes. Fundamentally, the certificates were an effective accounting gimmick that made the banks appear better capitalized than they actually were.
If enacted today, the net worth certificate would, as it did twenty-years ago, bolster the capital position of banks with troubled real estate holdings and give them the ability to both sell and restructure their bad loan portfolios.
Isaac`s solution is creative, a
quality missing in today`s
But why should
Joe Guzzardi [email him] is a California native who recently fled the state because of over-immigration, over-population and a rapidly deteriorating quality of life. He has moved to Pittsburgh, PA where the air is clean and the growth rate stable. A long-time instructor in English at the Lodi Adult School, Guzzardi has been writing a weekly column since 1988. It currently appears in the Lodi News-Sentinel.