Showing posts with label Banking. Show all posts
Showing posts with label Banking. Show all posts

Wednesday, June 10, 2015

The impermanence of the news cycle.




It never fails to surprise me about how little people retain from each day's news cycle. A few weeks ago, Obama's warming up towards Cuba was big news - and the "conservatives" were all chastising him for abandoning tactics which have been proven not to work. The same thing was done with Iran - and again, it was big news for a few days, and almost forgotten. We're seeing public opinion swayed by talking heads, in ways that George Orwell could only dream of....

Orwell, in "1984", presented a public speech where someone was ranting about one enemy, and in the middle of the speech the enemy changed. The former enemy was now a friend, and the former friend was now an enemy. Although this type of change isn't happening as fast as in Orwell's novel, we're already seeing this in our media.  How many of us remember when our enemy was "godless" communism? And now our biggest trading partner is the People's Republic of China - governed by the Communist Party.

Although George Washington warned us against having any permanent entanglements, I don't think that he would believe how quickly the world changes in our lifetime.  My father has seen Germany and Japan go from being friendly countries, to enemies, and back to being friends. And in my lifetime, I've seen the same happen with Vietnam, and am seeing it happen with Iran and Cuba.


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About 50 years ago, the city of Baltimore had its riots. And now, it had another round of riots. The problems are the same as they were 50 years ago - a general lack of economic opportunity. Americans will forget about this round of riots, as they have other important things in the news. But will we learn from them?

This time, we're seeing people around the world "armed" with cell phones (most of which contain the latest software) and active internet connections. Even in Iran's riots of a couple of years ago, the central government was unable to suppress all the news from getting out of the country. It couldn't suppress the news being passed along by its citizens. And the same thing happened here - the Baltimore Police could no longer cover up what triggered the riots - a "thug" whose rights were ignored by the police, and a death that couldn't be ignored.

Now, I've just used the word "thug" to describe this person. But is he as bad as the label I've attached to him?  In an area as economically depressed as his section of Baltimore, over 56% of the adult male population is unemployed. Dr. Phil noted in an interview on Fox News that the people living in these poor sections of cities may have the same potential, but not the same opportunities, education, or inter-generational social pass-throughs. Was this person's rap sheet caused by a defect in this person's character, or was it caused by the environment he lived in?  


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Two generations ago, we didn't need to worry about the problems of structural unemployment.  Today, both people in the inner city and the suburbs are affected by these problems. The low end jobs which were stepping stones to greater opportunities no longer exist. Low value/High Labor cost manufacturing left the United States years ago. Computers have replaced humans in many tasks which would have provided work - the computer managed "help lines" we call are perfect examples of this. It is cheaper to have a human interface with a series of telephone menus than to reach a real, live, flesh and blood human. And society no longer provides the full and free education needed to fill the jobs of tomorrow.

Our college education system has been corrupted by government funding - instead of having our government expand access to college by building more colleges, we've seen our government increase the monies available to students in student loans. Simply adding more money to buy more education doesn't do much good - it only raised the nominal price of an education, making it much harder for both the poor and the middle class to afford college. And for those that got the student loans, they often now have onerous debt to repay, and are deferring having children. (I'm not even talking about those who took out predatory student loans issued by for-profit colleges that provided sub-standard educations - these students were screwed the day they entered school, and no one wants to fix this problem because the affected students come from the lower castes....) Since student debt can't be erased in bankruptcy, we now have a generation of Americans who will not be able to afford what will be needed from them in the future.


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It is very interesting is that the problems that once only afflicted the lower class are now affecting the middle class.  Poverty used to be clustered in the inner city and in remote rural areas. Now, we're seeing newly poor people scattered through middle class neighborhoods. Houses are becoming derelict because of predatory lending combined with "Zombie Titles" that insulate banks from maintaining foreclosed properties - Banks are no longer foreclosing on many properties, making it impossible for borrowers to walk away from debt that they can no longer afford. Sadly, this may only be the tip of the iceberg when it comes to what the banks will be doing next to preserve their power in society....


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Where will we end up?  I don't know. I'm afraid for our future, as we're seeing the signs of America's upcoming collapse - and we, as a whole, have a lot of questions about our society's future that need to be asked and need to be answered.  So far, all our leaders are doing is pandering to us and our fears - they do nothing to deal with the real problems. And this is a great danger that we all should fear....














Wednesday, January 21, 2015

Now that the lunatics are in charge of the asylum, now what?




If the lunatics were in charge of the above asylum, I'm not too sure of how bad things would get. However, the lunatics are now in charge of the asylum below, and there's no limit to how much damage they can do....


Here's the problem - the wingnuts from the GOP's extreme right wing have taken over the party, and people like Ronald Reagan would be considered a leftist if his actions were listed without his name being attached to them.

Why is this important?

There is a lot of damage that can be done when one party is in charge of the legislative branch. There is even more damage that can be done when the same party is in charge of both legislative and executive branches of government. Regardless of what one thinks of today's Democratic party (and I don't think much of them), I am very upset at the rhetoric coming from the party in power.

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I'm a person who believes that as much power in society as possible should be left in the hands of the individual, and not the big corporation or big government. So my philosophy had led me to support a "pro choice" position on abortion, as well as a "pro 2nd amendment" position on gun control. The opponents of my viewpoints have valid reasons to disagree with me, and I respect their positions as important enough to discuss. In a healthy society, this discussion would lead to policies that would minimize the negative effects of preserving these individual rights. Sadly, in our society, both parties (and their supporters) are shouting past each other, saying nothing that the other side finds worthwhile to listen to.

This post will not be one that attempts to justify my position on these controversial issues. I could almost as easily justify the opposite positions on these issues - save that I don't want big government, big business, or some moral zealot telling me what I can do (or not do) with my body, and another moral zealot telling me what I can (or can't) use to protect myself (and my rights).

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When one party gains too much power, it can implement laws without the consent of a significant number from the opposition party. We live in a society where important decisions are being made with a public that is split 50/50 down the middle on most issues. Sometimes, this is needed. Other times, the opposite (no action) would be the best course of action to take.

Our founding fathers designed the American system to slow down the pace of decision making. The House of Representatives was designed for hot heads to vent their steam, while the Senate was designed to let bad bills go and languish in committee until they are dead and buried. This is very different from a unicameral parliamentary system as used in most of the British commonwealth - where one party can act very quickly. and get voted out (a vote of no confidence) at a moment's notice.

We suffer from a system which has become sclerotic. But should we be in a rush to change our system?  I doubt that major changes are needed. Instead, I think we need "small" changes such as term limits and non-partisan (or bipartisan) drawing of congressional district maps. We might also consider laws that break up the two party monopoly, mandating the governmental support for a third party in the same way that the Democrats and Republicans are supported in most states' laws today. Another avenue to help third parties would be laws to allow third party cross-endorsement of major party candidates. No matter what, we need to do something to destabilize the two major parties, as to help facilitate new ideas in the "public debate"....

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I find it amazing that both the Tea Party (on the right) and many leftists believe that the big banks are out of control. Yet they haven't bothered to look across the aisle to find that common ground needed to design meaningful regulation of the financial services industry, to rebuild checks and balances (like the Glass-Steagall act which once separated Commercial Banks from Investment Banks) needed for a sound economy.

In 2008, we almost saw a complete systemic collapse of the banking industry. I was in a bank that was reasonably well capitalized (I can't say anything about it now, as I no longer follow it in detail), while other "too big to fail" banks could have collapsed had the Federal Government not stepped in to save them.  (The HBO movie, "Too Big To Fail" gives a good idea of what was happening behind the scenes, and shows how close we were to the collapse I still fear so much.)

Recently, in the latest "Must Pass" bill, designed to keep the Federal Government running, we saw a relaxation of the "Dodd-Frank" rules that were designed to help prevent another systemic collapse of the financial system. Sadly, this bill was signed into law.

Right now, the lunatics are in charge of the asylum. Will they continue to act irresponsibly, now that they have the power to govern? I'm not sure. But I hope things will change for the better....