How Did We Get Into This Mess?

                                      By Robert Babcock     June, 2009

I recently attended a town hall meeting with a Pennsylvania state representative and asked the question “How did we get into this economic mess? The representative did not and probably was unwilling to answer the question.

The Bush administration in the fall of 2008, began to bail out financial corporations such as banks primarily because the cash supply for loans was depleted. This was due to several factors. The collapse of the housing market was the catalyst. Millions of home owners were given mortgage loans that they could not afford and consequently they were unable to make their monthly payments.

It is clear that the forced requirement by Congress members like Barney Frank, Maxine Waters and others, as well as members of the Senate like Chris Dodd and Chuck Schumer who compelled lenders to make risky home loans was pivotal in creating the housing downward crash. Corporate corruption by Fannie Mae and Freddy Mac executives such as Franklin Raines also was cited as a significant part of this problem. These people have yet to be brought before a committee to explain their motives and the reasoning behind their decisions. Thomas Jefferson said, “I believe that banking institutions are more dangerous to our liberties than standing armies.”  This would also apply with the word “banking” changed to “financial”.

Getting answers is a necessary step that must be taken in order to prevent this from happening again. These elected officials and corporate executives must be held accountable for this so that people can learn the details of what caused this failure. They must be put before a Congressional committee and placed under oath. Those that participated in corruption should be identified and those who used poor judgment in corporate business policy should be exposed.

As long as those involved continue to evade the questions the public will conclude that they have something to hide and that they are corrupt and inept or both.

COPYRIGHT 2009 Robert Babcock