Saturday, October 23, 2010

BloggeRhythms 10/23/2010

I came across some stuff today that's a microcosm of why this country is in such miserable condition. South Dakota Senator, John Thune, compared the current administration to a "science project gone wrong" during the Republican weekly radio address.

He went on to say "One of the Democrats' main responsibilities over the past two years was to improve the economy. Instead, they decided to try an experiment to grow government, raise taxes, and take over health care," ending up "openly hostile" toward business, and contributing to the weak economic recovery.

Now, without any political aspect to my thoughts at all, I have to agree with Thune's comments, because the administration in fact, whether it's an experiment or not, has grown the government, raised taxes, taken over health care and is very openly hostile toward business. And, this isn't my conjecture...as Casey Stengel the Ol' Perfesser said (Yogi said it too, and so did James Thurber...but he never made the majors,) "you could look it up."

But, what was most interesting to me was the president's response. He said "Top Republicans in Congress are now beating the drum to repeal all of these reforms and consumer protections. I think that would be a terrible mistake. Our economy depends on a financial system in which everyone competes on a level playing field, and everyone is held to the same rules, whether you're a big bank, a small business owner, or a family looking to buy a house or open a credit card. This is only one more piece of evidence as to why Wall Street Reform is so necessary." He also cited the recent housing mess in which banks are being investigated for using "flawed paperwork to process foreclosures."

And there's the rub. Because going back however many years ago to "Project Acorn" and the beginning of almost a complete disregard for the creditworthiness of borrowers, whereby anybody could get a mortgage in a heartbeat, that's where the financial downward cycle began. And today, those open door lending policies are affecting the entire civilized world.

So, just what is it about business, and finance in particular, that this administration doesn't understand? Because lending isn't a social "issue" at all. Lending requires that lenders be absolutely certain that borrowers can, and will, pay them back. Maybe in Socialism 101 some professor can make a case for a perfect financial world, where everyone is entitled to equal credit, regardless. But, in the real world, all you need to do is look at the pending defaulted mortgage rolls now to see that we're on the verge of another disaster, perhaps worldwide real estate collapse.

And, if nothing else, financial markets are not now, never were, and hopefully never will be level playing fields. For economies and the players within them to remain solvent, borrowers have to establish their creditworthiness. And, if they don't, the lenders, and as everyone can plainly see now, everyone else in the population is at risk. Because financial entities can't function when they're all broke. And, when they fail en masse, they take everybody with them.

But, maybe that's been the administration's plan along. To quietly socialize the population by taking over each business segment incrementally, banking, mortgages, health care, auto manufacturing, perhaps even expanding public radio by giving them unneeded funding. And then, one day, have everyone wake up to find that "big brother" has actually arrived.

Gee, an eventuality like that might even bring Soros back from Brazil.

That's it for today folks.

Adios

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