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Across The Fence Vote to help clean up politicians' mess Attention, this is a warning … please read carefully and respond accordingly.
We're in deep trouble: The stock market is tumbling, the deficit is rising, credit is getting tighter as consumer debt hits record highs, foreclosures are increasing and inflation is climbing. The recent talk I've heard about a recession is, in some circles, changing to a discussion about the possibilities of a depression. How did we get here? First, we're spending an obscene amount of money on the war in Iraq. Second, although the Federal Reserve Board cut interest rates again this week, that move isn't likely to stabilize the shifting sands upon which the subprime mortgage business was built. The stock market is still staggering. The ripple effects will undoubtedly touch every part of the national economy. Third, as mortgage lending problems mount, the decline is spreading to business and consumer lending. Commercial construction is lagging as it follows the curve of residential construction's decline. Builders, craftsmen, manufacturers and others will soon feel the pinch. Fourth, inflation has been on an upward trend since 2004. It's currently running above 4 percent, according to inflationdata.com. That means it's costing more to just maintain our households at their current level. Add escalating gasoline prices to the mix and it's putting a squeeze on ordinary household budgets. Fifth, consumer confidence is disappearing and consumers' willingness to spend is evaporating. It's almost impossible to save when everything costs more, and even minor expenditures are carefully scrutinized by most families. Our apathy and failure to hold elected representatives accountable brought us here. We're guilty of riding along on empty political reassurances and turning a blind eye to issues of national concern. We don't spend much time looking over the shoulders of our elected representatives or checking to see how they vote on key issues. As long as they don't become embroiled in any major controversies or scandals, we're content to ignore them. In the meantime, all kinds of laws are made that have a deep and lasting impact on the freedoms and quality of life we take for granted. Those of you familiar with Maslow's hierarchy will recognize that as economic difficulties increase, we'll have even less time to ponder the larger issues of life and liberty. Let's look at how our apathy contributed to the current crisis. The trouble actually began with the Reagan revolution and its goal of eliminating "big government" interference. Unfortunately, many safeguards were also eliminated. Few of us have forgotten the savings and loan bailout in the late 1980s that cost taxpayers billions of dollars. Things worsened when Congress repealed the Glass-Steagall law that separated banking and investment. The recipe for economic destruction was written when Congress overrode a veto by President Clinton to enact the Private Securities Litigation Reform Act. That law made it more difficult to prove securities fraud and led, among other things, to the Enron scandal. When President George W. Bush took office in 2001, the economy was healthy, interest rates were low, and the deregulation bandwagon rolled on. Real estate values were up and lenders rode the wave of prosperity and reaped the rewards of risky loans. It's true that record numbers of Americans were becoming homeowners, but as property values rose, real-estate speculators jumped onto the bandwagon and opportunities for fraud propagated. Once more, deregulation left the ordinary folks to fend for themselves at the expense of unprincipled executives, unbridled greed and an absence of legitimate oversight. Instead of relying on local banks or credit unions with stricter rules for creditworthiness, buyers turned to independent mortgage brokers. Brokers were rewarded for sale volume and many pocketed huge bonuses for steering borrowers to higher-interest loans. With those bonuses already pocketed, unscrupulous lenders won't care when interest rates on millions of loans accelerate this year. The agony and pain resulting from loss of homes and dreams due to foreclosures may not matter to them, but defaults projected at $1 trillion will send shock waves across the economy affecting even more American households. Deregulation isn't the answer. Neither is a financial system left unchecked by watchdog agencies or reasonable restrictions. It's time for us to take a hard look at our nation, its economy and leaders we've apathetically followed toward the brink of destruction. Shed your cloak of listless indifference. Investigate the issues facing this country, because its future is tied to your future and that of your children and grandchildren. Vote your beliefs. Vote your conscience. Vote for the candidate of your choice. But vote, and do so with the conviction that the ballot you cast does count. Kathie Greer: Columnist and consultant for the Amarillo Independent. She can be reached at kathie@amarilloindy.com. E-mail
comments about this story Posted: January 24, 2008
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