Home > Cande = Conjecture & Exaggeration, Fande = Fact & Evidence, Original Thought, The Economy > We, the People of the United States of America, need sensible regulations

We, the People of the United States of America, need sensible regulations

The favorite economic nostrum of conservatives, like Rick Santelli on CNBC, is “Less Regulations.” No, what Wall Street has proved without a doubt is that we need regulations.

Rick Santelli is a demagogue and a sophist. Loud and obnoxious, Santelli schemes to protect the lopsided status quo economic gains for the Superwealthy. Santelli did not scream when the Wall Street banks sank our economy and received taxpayer bailouts. Santelli did not scream when we all found out that there were no Weapons of Mass Destruction in Iraq, yet we wasted $1 Trillion there. Santelli did not scream when the majority of the $1 Trillion in Bush Tax Cuts went to the Superwealthy and did not improve the wage earnings or employment numbers of Americans. Over the last decade, U.S. corporations eliminated 2.9 million jobs at home and at the same time created 2.4 million jobs overseas, according to The Nation citing The Wall Street Journal. Santelli did not scream when we wasted over $1 Trillion on an unpaid-for Medicare drug benefit that was ramrodded through Congress by the Republican majority of the early 2000s.

When does Rick Santelli scream? When we, the United States of America, try to provide for the economic benefit of the majority of people in this country. When Lehman Brothers, Bear Stearns, Merrill Lynch, Washington Mutual, AIG, et al. went bankrupt, and Wall Street stripped away half of the profits from the Dow Jones Industrial Average (14,000 dropped below 7,000) along with half of the wealth from people’s 401ks and pension plans, while also creating mass unemployment and frozen credit markets that disabled small business investment, President Barack Obama had to clean up the economic messes (plural) left in the wake of Bush, Cheney, Paulson & Company. That’s when Rick Santelli SCREAMED!!!

“This is America! How many of you people want to pay for your neighbor’s mortgage that has an extra bathroom and can’t pay their bills?” – Rick Santelli


Reality Check:

Rick Santelli is a demagogue and a sophist. The predatory lending practices of subprime-mortgage lenders, like the now defunct Ameriquest and bankrupt Countrywide Financial, tricked many prime-lending candidates into ARMs – Adjustable Rate Mortgages – which many times carried an interest rate that could literally double and triple in just a few years (for example: balloon from 4% to 12%). That’s when people owed more on their mortgages than their homes were worth. Yes, some people signed up for these loans willingly because they thought that they could flip the homes before the mortgage payments exploded out of control. But many subprime loans were sold when the homebuyers could have got prime loans with no adjustable rates. Read Matt Taibbi’s Griftopia and Bethany McLean’s/Joe Nocera’s All the Devils Are Here for the Fact & Evidence.

IMPORTANT: The Subprime Mortgage Debacle was a locally grown financial problem that could have been contained to our shores, but Wall Street, bloviating about its ability to create short-term profits and reveling in its infinite greed, bundled up these crap loans and created packages to sell all over the world, which generated a global economic meltdown that continues to this day. The genesis of the problem was “Subprime.” Ameriquest was found guilty of doctoring loan documents in order to help unworthy homebuyers get subprime loans. Many banks and lending institutions were not checking that the homebuyers had jobs or any income. That’s for real. And why was Rick Santelli not SCREAMING then?

Because Rick Santelli is a demagogue and a sophist for the lopsided status quo economy that benefits the Superwealthy, who pay his salary.

CNBC is its own special dissembling, deceiving, demagogue center within the NBC network. The channel broadcasts other ideologically biased commentators, such as former Ronald Reagan staffer, Larry Kudlow. I have been watching CNBC since 2005, when I worked as a financial reporter on Wall Street. Every time the stock market tanks the CNBC personalities somehow always find an opportunity to either say it themselves or book guests who are willing to say, “Now is a great time to buy stocks.” Buy, Buy, Buy.  

The truth is that the fundamentals of the American Economy are unsound right now, because we have moved a majority of our manufacturing base away from our shores. In order to have a healthy, functioning economy and ensure the long-term success of our country, we need jobs for Americans. Then more people can pay taxes, which we need to pay for our roads, bridges, schools, hospitals, and on and on.

So why is Rick Santelli not screaming about the Wall Street banks double-crossing U.S. on the $700 billion taxpayer-funded Troubled Asset Relief Program bailout? Because George W. Bush pitched the American People on the idea that the Wall Street banks would L-E-N-D that money into the larger economy, but then a few weeks later Bush’s Treasury Secretary and ex-CEO of Goldman Sachs, Hank Paulson, informed us via the TV that the bailout would be used differently.

And why is Rick Santelli not screaming about Corporate America sitting on a record $2 Trillion cash on hand instead of hiring American workers?

We need regulations for Wall Street banks and regulations for companies operating in America. We need sensible regulations. Like making sure that Wall Street banks have capital reserves (or money on hand) to pay for their bets if they go bad. Or requiring that Wall Street banks can not place stock trades for themselves milliseconds before they place stock trades for their clients. Or eliminating tax loopholes and Cayman Island tax havens for corporations. Wait! Can you hear that? Nope, never mind. I thought maybe I heard Rick Santelli. He is quiet on these egregious violations of the public trust because he is a demagogue and a sophist for unlimited Wall Street greed and corporate profits, with secondary consideration for the majority of Americans. Caveat: not all Wall Street bankers and corporate executives function from a perspective of unlimited greed, but a lot of them do. And that’s why we need regulations. The evidence that we need regulations: Subprime, Lehman Brothers, AIG, Ameriquest, Bernie Madoff, and on and on. What Rick Santelli does with that information is blink and pretend like that information doesn’t exist, and then he will start SCREAMING again at anyone who doesn’t want to protect the lopsided status quo gains for the Superwealthy, who pay his salary.

“It is difficult to get a man to understand something when his salary depends upon his not understanding it.” – Upton Sinclair 

Switching gears to talk about Social Security:

Social Security was designed to be fully paid for by payroll taxes taken out of everyone’s paycheck, so that when we all get too old to work we can have some kind of retirement savings to live on. Democratic President Franklin Delano Roosevelt – the only president to be elected four times – established Social Security, Medicare and Unemployment Insurance benefits after three consecutive Republican presidents in the 1920s led to the Great Depression of the 1930s. Unfortunately, Ronald Reagan started stripping away Social Security funds (as did Bush 1, Clinton, and Bush 2) and replacing actual money with I.O.U. paper backed by U.S. Treasury bonds, which is considered the safest investment on planet Earth. Social Security still functions as it always has, because payroll taxes get taken out and older Americans always receive their Social Security checks on time. Until lately. Social Security recipients still receive their checks on time, but President Obama enacted a “payroll tax holiday,” which takes less money out of people’s paychecks during this Great Recession (caused by Wall Street greed and the mismanagement of a Republican-majority Congress and a Republican-controlled White House) and also depletes money coming into the Social Security coffers.

Solution: We need to fix Social Security. And, yes, we can fix it. Wait! Yes, now I can hear Rick Santelli SCREAMING!!!

Click the link to see the video:


Read more: http://www.nytimes.com/2011/10/23/opinion/sunday/who-needs-financial-stability.html?partner=rss&emc=rss


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