Guardian published an interesting list of 25 people it the heart of the meltdown listing 25 individuals and entities who (in their opinion) had a hand in our current economic situation. As indicated in the comments to the article, not everyone agrees with their choices which include Alan Greenspan, Bill Clinton, George W. Bush and others. Other people think that Ronald Reagan, Margaret Thatcher and Milton Freedman deserve to be included as well.
My favorite nominee – American and British Public:
There’s no escaping the fact: politicians might have teed up the financial system and failed to police it properly and Wall Street’s greedy bankers might have got carried away with the riches they could generate, but if millions of Americans had just realized they were borrowing more than they could repay then we would not be in this mess. The British public got just as carried away. We are the credit junkies of Europe and many of our problems could easily have been avoided if we had been more sensible and just said no.
To that I add overly-encouraging real estate agents, overestimating appraisers, extra-helpful mortgage brokers and anyone who profited on these loans. The reason the scheme worked is that it was structured as a multi-level-marketing pyramid with profits multiplying at the top, while the bottom supplied new applicants. These were the members of the public too, just as guilty as the rest.
I wrote about it earlier, but some years ago I was predicting this collapse when it still sounded a lot like conspiracy theory and I’d like to be included in the list of people who saw this coming. I guess I am always pessimistic (and defeatist) anyway so my predictions didn’t sound out of character.Right now my pessimistic worldview tells me that no one knows how to get out of the crisis. Many qualified people offer solutions both in academia and business but any action would be experimental, and I can only hope it will be easy on the test subjects.
In the meantime I’d like to wish all victims of the economic crimes, especially local Sprint employees, good luck. Every day I think about what would happen if I lose my job and nothing encouraging comes to mind, so I feel for the people who have to make these choices today, on someone else’s terms, in this economy. There is no question your company was mismanaged and robbed and it’s not your fault (unless you are the one who did the mismanaging and robbing, then it’s your fault, I hope you invested with Madoff). I hope you will find something soon, a secure well-paying job where your talents will be appreciated. You’ll be better off even if the pay is not the same. Good luck!
I so agree with your nomination. Cliff and I have discussed this a lot: People’s greed got us into this mess, and the word “people” includes me.
I’m sure you’re right, too, in saying that nobody knows how to fix it.
And I’m usually considered an optimist.
There is a lot of fault to go around, much of it well earned. It is gonna be a bitch to turn this sinking ship around, and while I have a margin of hope I am NOT an optimist.
I’d like to add my voice to those wishing the Sprint folks the best of luck. I know at least a half dozen folks working there, and not one of them feels real sure about their future right now. Hang in there!
Yeah, it’s hard all over but my friends at Sprint are seriously sweating it. Some of them have given considerable chunks of their lives trying to make the company a better place and it seems like they’ve been fighting the same downhill battle that our economy has.
A couple of years ago I was sitting on the patio with my daughter and her friend, both in their early 30’s. Daughter was talking about how they were having to pinch pennies and needed things, etc. Friend said to her “your land is paid for and there are all kinds of loans available you can get against the land, some interest only loans really cheap” (paraphrased).
That “land” the friend was talking about was the land that my husband and I had bought and paid off which daughter got free and clear after her father died. And, her friend, early 30’s, was living in a 400K house up to their asses in debt. Needless to say I told daughter and friend what I thought of that horseshit idea.
Two years later: Daughter and husband are doing just fine without mortgaging anything and friend’s husband has no work as a house framer and living in fear of losing their 400K home.
It’s totally the American and British public’s fault. I mean, they were practically asking for it! Did you see the way they dress?
As for how to get out of the financial mess, we should do what hauled us out of the Great Depression: massive government spending and forcibly removing a massive portion of our young workforce through conscription. We’d probably have to brew up some kind of a global-scale war to justify it, but hey.
I hear that debate is still going on if the Great Depression was prolonged or shortened by the government. The other thing is in 1930’s it wasn’t to hard to find a bunch of people who could do manual labor. I think nowadays a project like Hoover dam may not sound as appealing to people who use motorized scooters in a grocery store. lastly, when a person falls for Nigerian scam we all act in disbelief how stupid they are. this was the same thing times a million.
Nobody knows what the effects of the U.S. government’s reaction to the great depression were, really. After the dust settled and most of Eurpose was a smoldering wreck, the United States enjoyed a period as the only major industrial economy that hadn’t been bombed into the dirt for four or more years.
As for the availability of labor in the 1930’s, there’s labor available now, too. The question is how hungry are they? Is a laid-off Chrysler worker willing to pull up stakes and move to where the work is, or swallow his pride and take a less dignified job?
A lot of it comes down to managing public expectations at the investor, entrepaneur, and consumer levels. Alas, we have hundreds of media outlets whose bread and butter is frothing up public fear. Everything’s a crisis. Any doubts or concerns about a proposed solution are given instant credibility and a megaphone, encouraging people to pull out of the stock market, cut back on hiring, postpone business expansions, et cetera.
Should some machinists in the Detroit area retool their skills? Sure they should and possibly move too. But let’s not act like they have any companies in America offering similarly paying jobs for their skills.
You didn’t really answer Meesha’s comment about level of labor. Sure there are jobs available for these guys to dig trenches somewhere(actually there aren’t as we use backhoes for that now) or some other unskilled labor, but that’s still a huge hit to them and to the economy. When skilled workers have to drop down to unskilled labor they just displace the unskilled workers.
It used to take a generation of forgetfulness before our financial system did something really stupid… now it takes less than 5 years. Hats off to higher education.
I’ve often been tempted to use one of those “coin machines” that count all your change for you for a fee. But I can’t bring myself to “lose” 8 cents on the dollar.
17 years ago when my husband and I sold a house in detroit, he had to work, so I was the sole signee of all the papers. The realestate company, set me down, handed me the papers and told me to sign, when I began to read the papers, they got upset!! We don’t have time for this they said! Just sign they said! I informed them that by law I have a right to read “anything” before I sign it. And I did with all of their complaints of how I was messing up their schedualing, What I found was 4 or 5 items that had been double and triple charged on the paperwork, through various entities. If I had signed those papers without reading anything …..I would have walked out of there with 68.00 for the sale of a nice home!