Reality Impinges

The reality of the world economic crisis has still to fully hit home in one sense. Even now, after all the turmoil, the government acts as if the system can be saved. This is a colossal error. Paul Krugman in today's New York Times offers supporting facts for this view. The U.S. government, and other government officials around the world, prefer to believe that with enough money "injected" into the system all will be well and the speculative markets can continue without interruption.

However, nothing could be further from the truth. Again, the Krugman article is instructive in mentioning the crisis of 1997-98, and the "dot-com" crisis. Even the "sub-prime loan crisis" failed to trigger the kind of response which really was needed. Home loans should have been put into bankruptcy with the government acting as guarantor under new terms which the average home-owner could more easily handle. Indeed, the entire financial system should have been put in bankruptcy re-organization with the government acting as guarantor as others have recommended.

Continuing with the theme of reform, the Federal Reserve System has shown itself to be inadequate to the task. Something like a national bank (but not a monopoly national bank) should instead be established to regulate and protect all banks. Experts have been working on this mostly outside of government.

So hope is far from lost. But we must be willing to truly look to the future. We must prepare for a future in which the average person gets his due, even as big dealers are either brought in line, or -- as in the case of derivative and other swindles -- put out of business.


http://www.truthout.org/112808D