For thirty years or thereabouts, those in Washington - no matter the party - have completely rolled over the supposed evils of FDR’s New Deal. “DEREGULATE!” Was the war cry of American corporations as they sensed the will of those who had helped form those FDR protections against these economic royalists begin to slacken. To make that cry more appealing lobbyists, already a bane on the nation’s capital, swept in with silk suits and fat silk purses full of campaign contributions, beginning in the 1970s.
In the last few months, and especially this last week, the tsunami about which that some of us have raised the alarm finally arrived. It would be wonderful to sit back and say, “told ya so” if it weren’t for the fact that once again the only people hurt by this are - here’s a shocker - you and I. Those who caused this financial earthquake have either already walked away from it or are walking away right now - right to their Gulf Streams waiting for them at private airports, and right off to their private isles, where they’ll ride out the storm, wait until after the new year and then come back home to - one way or the other - carry on as usual.
Let’s take a quick stroll through the wonderful history of deregulation. The specifics we’ll leave to you to go look up. Trust me, its all there for those who wish to see…
The oil companies screamed for deregulation in the late 70’s. With deregulation they would be free to "reinvest in America’s energy infrastructure and make us independent of foreign influence."
Since 1979 there has not been one new oil refinery built in this country. The oil companies will tell you its because of tough environmental rules that make it too expensive to build those refineries. Everyone who believes that old hag of a shibboleth please step forward.
Article comments
— go to most recent comments1 - Dave Nalle
What everyone seems not to grasp - with Marlowe in the lead - is that there is a difference between actual regulation and government control. What FDR left us with was government control and interference, and in reaction to that the deregulators went too far in the opposite direction and apparently forgot that a reasonable level of government oversight wasn't such a bad thing. Now we're going to overreact again in the other direction and probably end up with more stifling government interference. If we'd just steered a reasonable course the whole time with free capitalism and reasonable government oversight we probably could have avoided this entire mess.
Dave
2 - MARLOWE
Dave... I can't believe I'm doing this but I am ALMOST agreeing with you! FDR didn't go to far... What happened - what seems to always happen, is that the bureaucrats, after time goes by looks for reasons to perpetuate their existence. ALL human organizations do this. Hell, you see it all the time in corporations - those supposedly streamlined money making machines. You ever read the BS an HR manager puts out for a job such as a customer service agent? Hell, it goes on for 3 friggin' pages!
I agree that there is a chance of "over correction" IF, indeed there is any kind of comprehensive regulatory agency established - which I doubt.
But you see, there already WERE such regulators in existence. The problem is they either a.) didn't do their jobs or b.) COULDN'T do their jobs because they had been stripped of any real power decades ago - progressively stripped by BOTH parties mind you.
I'll leave it there for now... I've got to go have another martini and try and get over the fact that I came THIS CLOSE to almost completely agreeing with you DN...
Gads...
Marlowe
3 - Dave Nalle
I bet we can also agree that bureaucrats are the problem in far more things than we ought to allow. Career bureaucrats ultimately beocome devoted to their own interests and to the interests of those they form alliances with in private industry and no longer serve the interests of the people.
As for the regulators in this situation, they were set working at cross purposes to themselves and serving at least two masters. And they're only going to be as good as the instructions they are given and the oversight which congress applies to them, which was poor at best. On the one hand they're supposed to make sure that loans are given to people without regard to a variety of politically incorrect criteria and on the other they're being asked to make sure that insurance companies don't take excessive risk. So they let the insurance companies get away with minimizing risk by exploiting subprime borrowers, thereby satisfying everyone and creating a big mess. But it SHOULD have been obvious to someone in a position of superior authority in congress or the fed or the treasury department or the white house how fucked up the situation was, and no one stepped up and did something about it.
Dave
4 - bliffle
Seeing the runaway predation of unregulated pirates almost makes one nostalgic for the ineptness of government bureaucrats.
5 - Cannonshop
Yeah, Bliffle, except that it's largely DUE to the ineptness of Government Bureaucrats-because the remaining regulations in place were not enforced, and self-serving apparatchiks gave false or misleading testimony to satisfy corrupt congresscritters instead of doing their damn jobs.
6 - MARLOWE
Bif and Cannon... (Wow, Sounds like a chocolate shop somewhere in London doesn't it...)
You both have it right... And with Dave being almost nearly kinda right... Wow. The planets are aligning...
Marlowe
7 - Joanne Huspek
"Career bureaucrats ultimately beocome devoted to their own interests and to the interests of those they form alliances with in private industry and no longer serve the interests of the people."
Amen. There should be term limits, and limits on how much they can accept from lobbyists.
It's been a long time since being in Congress meant being a public servant.
8 - Lumpy
term limits for elected offices make no sense but term limits for bureaucrats sounds like a fine idea.
9 - Pablo
As usual your adorable Lumpy.
10 - bliffle
#5 is BS.
11 - Cannonshop
#6
Not entirely, Marlowe-Bliffle believes in the essential goodness of Regulatory Agents, I think they're just as self-centred and career-obsessed as middle managers in Corporate America (but slightly less talented).
He thinks they reported honestly to oversight committees, I think they lied their asses off to make sure that any blame that came down didn't land on their desks, just like bunker-mentality theory-X middle-management types ALWAYS do (we have more than a few at The Boeing Company, and I recall there was no shortage in the Army of those types either.)
Then again, I tend to think of "Dilbert" as essentially non-fiction gussied up to protect the innocent, and that waste, fraud, and abuse are more the norm than the exception in large organizations with high levels of complexity and amatuer oversight.
12 - bliffle
Is cannon a mind reader? Can he divine what is in peoples minds, or is he just making things up for his own convenience, when he says things like:
"Marlowe-Bliffle believes in the essential goodness of Regulatory Agents,"
13 - Cannonshop
I interpret based on your arguments and stated perspectives, Bliffle. Unless you don't believe what you're saying?
14 - georgio
I too agree with Dave but in simple terms I think he is saying ..IF ONLY EVERYONE WAS JUST HONEST.
could anyone explain how this whole mess isn't just like the pyramid scheme or the ponzie scheme.
15 - MARLOWE
Cannon... I never stated anything remotely like you suggest in #11. And you must have meant something considerably different than what you wrote in #5.
The regulatory agencies that exist are by and large the ones put into place during the time of FDR or shortly there after.
The PROBLEM is that over the decades since the late 70s they've had their TEETH pulled, year after year... Eventually those in power installed YES men in these agencies who not only wouldn't oppose market behavior that was destructive but would SUPPORT it...
Now, Cannon, that seemed to be, generally, what you were saying in #5. And that's what I was briefly agreeing with...
If that ISN'T what you meant to say AT ALL, I might suggest you take a refresher course in English.
Marlowe
16 - Cannonshop
Ah...
Well, thing is, what you briefly agreed with was, for the most part, something I agree with as well...however, I tend to include the incompetents we elect with the incompetents they, in turn, appoint, the "Yes Men" you mention in #16. Bureaucracies that feel under threat tend to develop the kind of "Bunker Mentality" that allows "Yes men" to thrive without threat of whistleblowers. If you've worked for a Large corporation, you've probably encountered the type.
17 - bliffle
Cannon 'interprets' without knowing, i.e., a sort of sleazy lie.
Desperate Cannon? Grasping at straws? Do you feel you are drowning as your unregulated ship goes under?
18 - Cannonshop
Not MY ship, Bliffle, I don't believe that Lassaiz'Faire is a good policy, but I DO think that regulations should be enforceable, enforced, and able to be complied with. (I also think we have too many laws, they're too complex, and have too many exceptions and exemptions.) It's not inconsistent, Bliffle. Anyone that wants to play should be able to understand the rules, and the guys we the people hire to enforce those rules should have the spine and the backing to do so, and the balls to take the hit when they're wrong.
I'd also like to see a few hundered executives wearing blaze-orange or bright pink paper jammies in a maximum security prison, sharing cells with the rest of the criminals, along with a whole nest of snakes that have infested our government and taken the bribes, been the yes-men, and all around assisted those executives in wrecking my country's economy.
Considering what's infested the Oversight committees, that's most of the Incumbents from both parties, plus a huge number of current and former regulatory officials, PLUS a huge number of pus-bag FORMER incumbents that lost the last election cycle, along with every Speaker of the House since Tip O'Neill (who's only excluded because he's already dead.)
I'm (obviously) not going to get what I want, but I'll settle for as many as can be nailed any way that the law allows, it's only unfortunate that there aren't a whole bunch of Lawyers who can file civil suits to impoverish these fucks and drive them from both corporate, and public life, and down into the land of selling their wives on the street for crack money.
19 - MARLOWE
Cannon... You seem to have clarified yourself here... And I am in general agreement with you...
I'm afraid you're going to suffer severe chest pains though as we watch the new government agency HAND BACK to the very people who created this mess the new "tools" to clean it up (with the "tools" including grotesque salaries...)
It's gonna happen. The old boy network is literally incapable, even when they get some mental nudge that they SHOULD, of breaking out of their MO...
Marlowe
20 - Cannonshop
I Know.
21 - bliffle
Marlowe is right. Even at this moment an unholy alliance of Wall Streeters (masquerading as Federal Treasury officials) and neo-republican congress-whores (now stripped of all pretense of Fiscal Responsibility) are angling to use the crisis to jam through this $750billion gift to Wall Street.
I might remind you that there was NO crisis when 2 million americans lost their homes to the wild machinations of this pirate-operated economy. Then it was "ho hum" for those people and some Calvinistic chastising and finger wagging at people who were told they were buying more house than they could afford and they should be ashamed of themsellves for speculating like that.
At the same time this Unholy Alliance is going to authorize their pals at Goldman Sachs and Morgan Stanley to take over banking enterprises, thus completing the debacle authored by McCain adviser Phil Gramm to loot your banking account in order to shore up their failing market wagers and wild speculations.
This is such an outright theft of the last scraps of money that any ordinary american might have anywhere that it is utterly breathtaking.
Even if you have prudently removed your money from US banks you will STILL be financially persecuted by the astonishing new tax policies which certainly must follow the assumption of Wall Street debt by these bounders.
Plus, the inflationary cyclone that will follow all this will simply demolish every semblance of fiscal order and probably social order as well.
The only defense that we have now in Washington is the much despised Pelosi who is going to fight this flight to insolvency and chaos.
Some people might have to cast off the chains of their partisan beliefs in order to survive. Adapt or die.
22 - MARLOWE
Biff... I agree here too. If anyone is foolish enough to think that the fox has become repentant now that he's cornered they deserve whatever they get.
The power-that-be will twiddle around while the election looms, hoping that Americans, with their 5 second attention spans....
....
....
attention spans... Oh! And they'll assume we'll shift our attention to the election only, well, maybe what candy to get for Halloween too...
Let's see what FDR said, back in 1936. This is a little portion of his speech to the Democratic National Convention...
To quote FDR in 1936:
For out of this modern civilization economic royalists carved new dynasties. New kingdoms were built upon concentration of control over material things. Through new uses of corporations, banks and securities, new machinery of industry and agriculture, of labor and capital-all undreamed of by the fathers-the whole structure of modern life was impressed into this royal service.
There was no place among this royalty for our many thousands of small business men and merchants who sought to make a worthy use of the American system of initiative and profit. They were no more free than the worker or the farmer. Even honest and progressive-minded men of wealth, aware of their obligation to their generation, could never know just where they fitted into this dynastic scheme of things.
It was natural and perhaps human that the privileged princes of these new economic dynasties, thirsting for power, reached out for control over Government itself. They created a new despotism and wrapped it in the robes of legal sanction. In its service new mercenaries sought to regiment the people, their labor, and their property. And as a result the average man once more confronts the problem that faced the Minute Man.
The hours men and women worked, the wages they received, the conditions of their labor-these had passed beyond the control of the people, and were imposed by this new industrial dictatorship. The savings of the average family, the capital of the small business man, the investments set aside for old age-other people's money-these were tools which the new economic royalty used to dig itself in.
23 - cuervodeluna
They will rob you blind as long as you let them do it.
Which means that the collective YOU is the problem.
Gringos always believe that nothing will ever happen to THEM.
I think that used to be called "exceptionalism", or some such nonsense.
24 - Jordan Richardson
Each time you say "gringo," I take a shot of tequila. 11:12 in the morning and I'm already fuckin' wasted...
25 - MARLOWE
cuervodeluna... So nice of you to show your prejudicial eye so early in the morning... For your information I am half Mexican. My mother was born and raised in Guadalajara, Mexico... As a matter of fact my ancestors were some of the largest land holders in California BEFORE the gringos showed up...
And since my father was not JUST a gringo but a Texan I guess I can speak from both sides of the goddamned border, can't I?
[Personal attack deleted by Comments Editor]
Marlowe