Video supports author Paul Craig Roberts' contention that DEREGULATION was at the core of the US economic, credit, and banking crisis. Roberts make the explicit claim that the Republican "DEREGULATION!" mania came LONG AFTER President Reagan had left office, and when Republicans like PHIL GRAMM, JOHN McCAIN, DICK ARMEY, and Dick Cheney steered the Republican Party AWAY from the course set by Reagan.
AN EXCELLENT commentary by former REPUBLICAN REAGAN ADMINISTRATION official PAUL CRAIG ROBERTS outlines and details how THE _DEREGULATION MANIA_, propelled by Wall Street GREED led DIRECTLY to the current CREDIT, BANKING, and MORTGAGE CRISIS,
the current economic crisis being an EXACT, CARBON-COPY REPLAY of the 1980s SAVINGS & LOAN crisis that led directly to the Bush-1 DEFICITS, which led directly to the BUSH-1 RECESSION, which led to Iraq War US Army combat veteran Timmy McVeigh - involuntarily discharged from the Army and UNABLE TO FIND EMPLOYMENT in up-state New York after the war - to start listening to RIGHT-WING HATE RADIO as he moved to the MILITIA/gun-nut subculture, before he plotted and executed the BOMBING of the Oklahoma City government building with murderous results.
THOSE are the STAKES of THIS ECONOMIC CRISIS.
THIS economic crisis is a DIRECT RESULT of WALL Street bankers and brokers getting paid inflated commissions, from mortgage loans hyping INFLATED and OVER-VALUED property values. The "sub-prime" mortgage crisis is actually A SMALL PART of the "good" QUALIFYING home loans THAT WENT BUST - WASHINGTON MUTUAL _DID NOT_ write many "sub-prime" mortgages before it went into virtual bankruptcy and was taken over by the government.
I remember when the deregulation of the financial sector began. One of the first inroads was the legislation, written by bankers, to permit national branch banking. George Champion, former chairman of Chase Manhattan Bank, testified against it. In columns I argued that national branch banking would focus banks away from local business needs.
The deregulation of the financial sector was achieved by the Democratic Clinton Administration and by the current Secretary of the Treasury, Henry Paulson, with the acquiescence of the Securities and Exchange Commission.
The Paulson bailout saves his firm, Goldman Sachs. The Paulson bailout transfers the troubled financial instruments that the financial sector created from the books of the financial sector to the books of the taxpayers at the US Treasury.
This is all the bailout does. It rescues the guilty.
The Paulson bailout does not address the problem, which is the defaulting home mortgages.
The defaults will continue, because the economy is sinking into recession. Homeowners are losing their jobs, and homeowners are being hit with rising mortgage payments resulting from adjustable rate mortgages and escalator interest rate clauses in their mortgages that make homeowners unable to service their debt.
Shifting the troubled assets from the financial sectors’ books to the taxpayers’ books absolves the people who caused the problem from responsibility. As the economy declines and mortgage default rates rise, the US Treasury and the American taxpayers could end up with a $700 billion loss.