Last January I wrote a column entitled: Are Polar Bears Edible? I pointed out that during good times, people worry about whether polar bears will have ice in one-hundred years—but when times are tough we wonder whether the bears are tasty.
I suggested that in the event of a worldwide financial crisis, we would likely focus our collective attention on government spending, and whether the corporate directors legally responsible for doing so were protecting our investments. In short, Americans would not worry much about whether companies were being socially responsible; we would worry about whether they were being financially responsible.
Little did I know at the time that less than a year later Americans not only would be confronting bank failures, a credit crisis, and a wildly gyrating stock market, but also a federal government taking actions that would make even Karl Marx blush.
With a handful of exceptions in the Senate and House, the only people who appear to be genuinely concerned about what has been going on in Washington, D.C., are the people who reside outside of Washington, D.C. They seem to think that playing high-stakes poker with $700,000,000,000 in taxpayer cash and nationalizing a sizeable chunk of the private sector merits more than a few days of hemming and hawing. Those pesky taxpayers!
Meanwhile, Capitol Hill has been so chaotic that it is hard to tell who is in charge. Is it Karl Marx, or the Marx Brothers? By the time this column appears, the so-called “rescue” may have been enacted, and most of the 535 members of the U.S. Congress will have bailed out of D.C. to return home for the election. What will they say when a constituent asks, “Senator Groucho, how in the heck did this fiasco happen?” or “Representative Harpo, who is to blame for this world-class mugging?”
Truth be told, it all goes back to the screwball notion that the basic laws of economics can be successfully violated by clever politicians bent on redistributing the wealth and dictating how the rest of us live. In other words, this debacle did not start on Wall Street; it came out of both ends of Pennsylvania Avenue.
First, Jimmy Carter and his merry band of congressional miscreants enacted the 1977 Community Reinvestment Act. The purpose of the Act was to provide credit, including home ownership opportunities, to “under-served populations.” In those days that was the politically correct way of referring to poor folks.