You may be wondering what the root causes are behind why your real income has plummeted by a quarter on every dollar in just the last year (those numbers are my best guess). I’m not an economist but I don’t really need to be to notice some really odd things going on behind the scenes. I say odd but I could as easily replace the word odd with stupid or rash or criminal. I could even say with a high degree of confidence that policy makers and politicians behind the scenes are doing a lot of odd, stupid, rash and criminal things to ensure that our dollar cannot hold its value. Let’s get into the meat of things.
First and foremost, I want you – the reader who happened across these words however you did – to remember that the people you elect make decisions that will ultimately help or hurt everyone around them.
TAUNTON, Mass. – A 53-year-old wife and mother fatally shot herself shortly after faxing a letter to her mortgage company saying that by the time they foreclosed on her house that day, she would be dead.
Police said that Carlene Balderrama used her husband’s high-powered rifle to kill herself Tuesday afternoon, shortly after faxing the letter at 2:30 p.m.
The mortgage company called police, who found Balderrama’s body at 3:30 p.m. The auction was scheduled to start at 5 p.m. and interested buyers arrived at the property in Taunton, about 35 miles south of Boston, while Balderrama’s body was still inside, according to Taunton police chief Raymond O’Berg.
I am not suggesting that a politician forced Carlene Balderrama to shoot herself in the head with a high-powered rifle, but I am suggesting that our system of governance set her up for failure. How many young Americans are taught sound economic policy in government run schools? I certainly wasn’t. Of course, it is hard for a fiscally irresponsible entity like government to teach sound fiscal policy. Social Security is the biggest Ponzi scheme ever realized. So it makes perfect sense that Carlene Balderrama found herself in the situation she found herself in. I understand why some people would rather end it all than face losing their only anchor in life – for many people their home is their sanity bubble in a crazy world.
Let’s discuss for a moment some of the individuals and organizations that are responsible for the current mortgage and real estate climate we find ourselves in. We’ll start with the Fannie Mae Gang.
Angelo Mozilo was in one of his Napoleonic moods. It was October 2003, and the CEO of Countrywide Financial was berating me for The Wall Street Journal’s editorials raising doubts about the accounting of Fannie Mae. I had just been introduced to him by Franklin Raines, then the CEO of Fannie, whom I had run into by chance at a reception hosted by the Business Council, the CEO group that had invited me to moderate a couple of panels.
Mr. Mozilo loudly declared that I didn’t know what I was talking about, that I didn’t understand accounting or the mortgage markets, and that I was in the pocket of Fannie’s competitors, among other insults. Mr. Raines, always smoother than Mr. Mozilo, politely intervened to avoid an extended argument, and Countrywide’s bantam rooster strutted off.
The federal government controls banking in this country with an iron fist. A huge arm of banking is the mortgage industry. Thus we can logically conclude that the federal government controls the mortgage industry. I’ll take that a step further and blame the federal government directly for creating a climate of instant gratification and greed. By taking responsibility for educating Americans, government also takes responsibility for the complete lack of economic common sense the average American has. By encouraging lenders to offer easy loans to people with bad credit and low incomes and then buying these questionable loans the federal government takes responsibility for the massive foreclosures and slumped real estates markets that are currently plaguing the economy.
In our ignorance and because we’ve been well trained not to think for ourselves Americans will demand as a solution to these government created problems – you guessed it – more government. Yes, yes, Obama is going to save us all. Good luck with that. It’s a pipe dream.
A nation cannot survive without sound economic policy. Until we start cutting entitlements and eliminating unnecessary government programs and employees we’re going to continue to slide downhill. Unfortunately, as a nation, we are so collectively stupid that isn’t even on the agenda this election cycle.