Hundred Power

This week’s hullabaloo over the AIG bonuses is an indication that the public is paying attention. However, the public may simply be going after the wrong people. In other words, chasing a red herring instead of attacking the real problem. One can only hope that the anger now turns toward the source of the real problem. The real problem people are the members of Congress. For thirty years, the Congress has gone along with the mentality of the corporate finance community. The mentality said regulations are bad. In fact, it looks as if criminal enterprise is now a part of the definition of free enterprise. Just look the other way and say, “Let the buyer beware.”

AIG, and the rest of the financial industry, sold options to their customers which weren’t covered. It’s like selling insurance and hoping that claims wouldn’t come in. Why? Because AIG and the rest didn’t have the money to pay off. And Congress looked the other way.

Albert Einstein told us, “Intellectuals solve problems; geniuses prevent them.” The good news is that Congress doesn’t have to be a genius, nor even very smart, to put back all the financial rules of the New Deal. Most of the legislation was written 75 years ago.

The “financial crisis” started last year. Have you seen one effort by Congress to put the honest controls back in the system? Have you heard of one piece of legislation? It seems like we’ve seen lots
of finger-pointing and name-calling. And speeches that never get to the heart of the matter. The solutions are so simple. What’s the problem? Is it the system itself that’s the problem?

Here’s what one wise man observed as the problem with Congress. Mark Twain boasted,
“I think I can say, and say with pride, that we have some legislatures that bring higher prices than any in the world.”

Click here to contact your representatives in Washington, D.C.:
Our Elected Officials. Tell them you want a regulatory system you can believe in.

– Byron