Larry Beinhart over at commondreams.org makes some great (IMHO) suggestions: http://www.commondreams.org/view/2008/09/27-0

He suggests that, instead of spending a trillion dollars or so to bail out Wall Street, we spend half that to invest in:

National health. Thereby making our older industries, burdened with health insurance commitments more competitive.

Protecting our coastlines. Thereby protecting ourselves against the huge losses from hurricanes like Katrina & Ike.

Investing in alternative energy, particularly wind and solar, and rebuilding the electrical grid to facilitate that. The work required to do that could not, for the most part, be outsourced. The jobs and the business would stay here.

Rebuilding our infrastructure generally. Good, efficient infrastructure makes business easier, quicker and cheaper.

Buying up individual problem mortgages.

Setting up a federal bank to make emergency loans to businesses and individuals who have come into harms way as a result of the crisis created by the Bushocrats and the Titans of Banking. When they're busy scaring us into this greatest of all heists in human history, they always talk about how it will affect "small business owners" who won't be able to make payroll, and the jobs and homes lost, to average folks on main street. If they need taking care of, let's do it directly, instead of through the rip-off artists who created the crisis.

The Big Big Bailout, as it is, will be crowning glory of Bushianity. One, gigantic theft of from real Americans to enrich the ruling class. It's a hell of trick. It's just like all the ones he's pulled before. If we fall for it, we are suckers and rubes, indeed.

"We must be the change we wish to see in the world." -- Mahatma Ghandi

I have a better way to solve our financial crisis.  Since it was Democrats and no one but Democrats that caused this financial crisis, I suggest that every registered Democrat be required to pay 10,000 to solve this crisis.

Is was Jimmy Carter that started the ball rolling on loans for people that couldn't afford them.  It was Bill Clinton that expanded the program.  When Republicans recognized the situation and suggested legislation and regulation to get it under control, it was Democrats like Dodd, Shummer and Frank that fought off those efforts.  And it has been Democrats that have all along been in the pockets of Fannie Mae and Freddie Mac - defending them against scrutiny and reasonable regulation.  It is Democrats that sued loan companies that would not loosen their loan policies and give loans to those that could not support them.  It is Democats that defended the fraudulent heads of Fannie and Freddy while those CEOs were pocketing millions.  It is Barrack Obama that has brought the heads of those failed organizations into his campaign.  And Barrack Obama is the receipient of more campaign money from Fannie and Freddy than all but one other Democratic Senator.

http://www.youtube.com/watch?v=YGnZMGDG4k4&feature=re ...

http://www.youtube.com/watch?v=cVi_Jjxli1o

http://www.youtube.com/watch?v=3QBRIsCkGQ0

http://www.youtube.com/watch?v=ASvqtD6g8PU

A remarkable amount of mental energy has been exerted by many `experts' (and wealth distributed to them by their benefactors) over much of my lifetime in a concerted effort to widely share and consensually validate the specious idea that there is no such thing, of all things, as the most obvious of things......limits to growth in a finite world. Most recently, Schellnhuber in Germany, Rapley in England, Rees in Canada, Hansen in the USA, McMichael and Butler in Australia......the list goes on and on...... good scientists all, have been noting over and over again that the human species is approaching ecological limits evidently, obviously imposed by the biophysical reality of the planetary home we are blessed to inhabit. To put it another way, rampant overproduction, rapacious overconsumption and unregulated overpopulation activities by the human species now overspreading the surface of Earth will lead to an ecological "tipping point" of some, perhaps unimaginable sort.

The question seems to have been, Which biophysical limit will be exceeded first? Precisely what will it mean for the human species to overreach and by so doing "give rise to" or "produce" some sort of ecological tipping point? What will happen then? What kind of global wreckage might ensue? What will that moment in space-time look like? Many scientists seem to have been thinking that the unbridled overgrowth activities of the human species would literally and eventually overwhelm the Earth and its environs because the family of humanity has chosen to recklessly ignore the reality of human species limits and Earth's biophysical limitations. For example, recall the ruthless derision of the great work of the Club of Rome regarding ecological limitations to the growth of absolute global human population numbers.

Even so, despite all the attention, the warnings and the good scientific evidence, an ecological tipping point may not be the source of the greatest, most imminent challenge to human wellbeing in these early years of Century XXI. The most pressing, most forbidding threat to human wellbeing may not be ecological in its nature.

For a long time, I have been haunted by the words of Percy Bysshe Shelley (1792-1822) that are emblazoned in a sonnet about Ozymandias.

" I met a traveller from an antique land
Who said: Two vast and trunkless legs of stone
Stand in the desert. Near them on the sand,
Half sunk, a shatter'd visage lies, whose frown
And wrinkled lip and sneer of cold command
Tell that its sculptor well those passions read
Which yet survive, stamp'd on these lifeless things,
The hand that mock'd them and the heart that fed.
And on the pedestal these words appear:
"My name is Ozymandias, king of kings:
Look on my works, ye Mighty, and despair!"
Nothing beside remains: round the decay
Of that colossal wreck, boundless and bare,
The lone and level sands stretch far away. " --Schelley

What was the "colossal wreck" this "king of kings" observed and how had it happened? What caused the destruction of the world?

The calamity Ozymandias witnessed may not have been more or less than the incredible consequences of human greed having exceeded limits to its growth. That is to say, the adamant and relentless greediness of kings and self-proclaimed Masters of the Universe precipitated the gigantic, distinctly human-driven catastrophe to which The King of kings makes reference.

Steven Earl Salmony
AWAREness Campaign on The Human Population,
established 2001
http://sustainabilitysoutheast.org/index.php

"The root" of the problem is not the housing collapse -- the housing collapse is the symptom of the national devotion to continual growth divorced from exertion.  

In short, if there is "a" root to the multiplicity of crises we are just now becoming aware of, it is the belief that there is this one thing called "the economy," the size of which can grow without regard to the underlying energy and material flows that were once measured by the amount of wampum that moved around.

Speaking of frames, remember that when you buy into the frame of "the economy," you've already bought into the idea that there is this one thing, measured by the usual metrics (GDP, GNP, etc.) that presents the same aspect to everyone, and that we all participate in.  This is nonsense, however.

The triumph of finance capitalism is that it creates a panoply of economies, in which those who are wired into the game can profit handsomely despite the impoverishment and immiseration of millions (or, now, billions) of others.  Textbooks suggest that this should not be possible, that a breakdown in the economic situation of many people should undermine the situation of the elites, sooner or later.  

But finance capitalism breaks this connection and provides a soft playpen for the the masters of the universe to manufacture money and shower it upon themselves, all without the dreary bore and bother of producing anything useful to anyone.  Thus, even as America is collapsing in real terms (infrastructure, literacy, lifespan, access to health care, inequality, etc.), the finance capitalists have done quite well, thank you.

The only reason that the housing crisis is a crisis for them is that it means the music stops and whoever is left holding all that toxic paper has to eat it -- but, wait, look over there!  The taxpayers will ride to the rescue!!!  Hooray!  By selling the kids and grandkids of America into debt bondage, the salons in DC can both ensure a steady flow of campaign contributions in perpetuity AND a chance for themselves to join the elites inside the glossy bubble of finance capitalism.

In terms of the environment, the crisis is this:  once you overdrive the planet's resources long enough, cracks and crevices begin to appear in the biological web that cannot heal on anything less than a geological time span.  If you continue to overdrive the thing -- to consume much faster than the regeneration rate, to exhaust in days the energy stores built up over eons, to saturate pollution sinks in hours that need centuries to process the wastes -- you eventually wind up with your phony measurement systems (beans, wampum, currency) losing all connection to physical reality.

[If our money supply was shrinking at the rate our resource base was (as it should, if we actually wanted anything like a sustainable economy), then you'd REALLY see a crisis, because it would be first and foremost a crisis for those whose primary activity is the manipulation of these phony currencies that we've come to rely on.]

The 5% Project

Who could have guessed. This nasty little passage it (Saluki) left here:

Is was Jimmy Carter that started the ball rolling on loans for people that couldn't afford them. Is Klanspeak for: "Jimmy Carter forced the banks to stop redlining, selling discriminatory loans to blacks, asians and hispanics or refusing them loans entirely."  

Well digging around for more information I came up with a perfect rejoinder which, alas, I did not write. I quote from the Washington Monthly's Steve Benen:

September 22, 2008

THE NEW TALKING POINTS.... For about a week now, Republicans have been looking for a way to blame the crisis on Wall Street on Democrats. The search hasn't gone well -- at one point, John McCain said Barack Obama was partially responsible, because he'd been "gaming the system." The comment didn't make a lick of sense, no one bought it, and McCain hasn't repeated it since.

But conservatives kept on trying. In fact, the right seems to have finally come up with a new line: Democrats forced banks to give mortgages to low-income minorities, those low-income minorities couldn't keep up with their mortgage payments, and the banks struggled as a result. Voila! Blame the Dems!

Fox News' Neil Cavuto helped get the ball rolling. Media Matters reported that Cavuto conflated giving home mortgages to minorities with risky lending practices, suggesting that there should have been "a clarion call that said, 'Fannie and Freddie are a disaster. Loaning to minorities and risky folks is a disaster.' "

The National Review is on board with a similar line of thinking, blaming the Community Reinvestment Act for much of the crisis: "The CRA empowers the FDIC and other banking regulators to punish those banks which do not lend to the poor and minorities at the level that Obama's fellow community organizers would like. Among other things, mergers and acquisitions can be blocked if CRA inquisitors are not satisfied that their demands -- which are political demands -- have been met. There is a name for loans made to people who do not have the credit, assets, income, or down payment to qualify for a normal mortgage: subprime."

All of this seems rather silly on its face, but thankfully, Matt Yglesias went to the trouble of setting the record straight.

    For one thing, the timeline is ludicrous. The Community Reinvestment Act was passed in 1977. Are we supposed to believe that CRA was working smoothly throughout the Carter, Reagan, Bush I, and Clinton years and then only under Bush II did overzealous anti-"redlining" enforcement come into play, perhaps a result of Dubya's legendarily close relationship with ACORN? Or maybe overzealous enforcement back in the late 1970s is somehow responsible for a real estate blowout that only materialized 30 years later? It doesn't even come close to making sense.

    Beyond that, the mere existence of "subprime" loans -- i.e., mortgages given to less-creditworthy individuals at higher interest rates -- isn't the problem here. The problems have to do with what was done with the loans after they were packaged, sold and used to make leveraged plays.

Sorry, conservatives, you'll have to keep looking for a way to blame Democrats for this mess. Good luck with that.

Never mind that each of these transactions were supervised by real estate agents who are supposed to earn their pay making sure that deals are legit on all sides and that their clients are represented. Never mind that mortgage brokers, appraisers and banks are all under investigation by the FBI for writing bad loans on bogus appraisals. Never mind that the banks then sold the loans as 'tranches' which violated the Glass-Steagall act until it was repealed thanks to Republican, Phil Grahm.

It was the coloreds that caused this you say?

Isn't there a hole you can crawl into somewhere? Preferably in Idaho where your own kind congregate.

Put the Carbon Back

"The Saluki troll is racist as well?"

Only a birdbrain like Pangolin would believe that restricting loans to people who will pay them back is racist.  But of course we know that Pangolin is too stupid to come up with a real argument, so she has no choice but to play the race card.

Of course Yglesias is a left wing idiot who will always find a way to spin the facts.  The fact that Carter's Community Reivestment Act happened in 1977 is irrelevant.  Loans last for 30 years.  1977 was simply the beginning of the issuance of such loans.  As the years have gone by, a higher and higher percentage of such loans have been a part of the total.  The Community Reinvestment Act was simply the first floor of the house of cards built by the Democrats.

From Wiki:
"In 1995, Fannie Mae began receiving affordable housing credit for buying subprime securities. In 1999, the Clinton administration and Fannie Mae shareholders encouraged the lender to increase the number of mortgage loans offered to those of low and moderate income, both to improve rates of home ownership among those groups and to increase profits."

So after the Carter contribution, the next part of the puzzle was to have Fannie and Freddy buy subprime loans from the nations lenders.  The quality of the loans which Fannie and Freddy accepted was very low, at the prompting of the Clinton administration.  Of course the lenders made loans according to the quality of what Fannie and Freddy were willing to buy from them.  Since they were anxious to buy garbage, the lenders were willing to make loans that were garbage.

In 2003 president Bush raised the alarm about the danger to our finacial system that was caused by these high risk loans.  People like Barney Frank fought him off, claiming that everything with Fannie and Freddy was just fine.  There was no risk, he claimed.

In 2005 McCain produced a new bill in committee to regulate and oversee Fannie and Freddy.  The Republicans on the committe voted for the oversight.  All of the Democrats voted against it.  Because of the unanimous opposition by the Democrats, McCain never brought the bill to the floor for a vote.

"Never mind that the banks then sold the loans as 'tranches' which violated the Glass-Steagall act until it was repealed thanks to Republican, Phil Grahm."

You are talking about the Gramm-Leach-Bliley act.  This said that Finacial Service Companies could own Banks and Banks could own Financial Service Companies.  So what?  Let's see who supported the bill.

  "Let me welcome you all here today for the signing of this historic legislation. With this bill, the American financial system takes a major step forward towards the 21st century, one that will benefit American consumers, business, and the national economy for many years to come." -- Larry Summers, Then-Clinton Treasury Secretary And Current Obama Adviser, On Gramm-Leach-Bliley (1999)

Clinton's man Robert Ruben also lobbied for the bill.  And of course Clinton signed the bill.

Probably more relevant to the discussion is the Commodity Furtures Moderniztion Act of 2000.  This bill was sponsored by Gramm.  But it was also co-sponsored by 2 Democrats.  It contains provisions for credit default swaps that are mostly unregulated by the government.  Once the house of cards that had been built by Carter, Clinton, and other Democrats began to fall, these derivatives made it fall that much faster.  But this act was hardly a product of Republicans.

The vote was 180 Democrats for 2 against - 195 Republicans for 2 against.  And Bill Clinton signed it.

http://www.govtrack.us/congress/vote.xpd?vote=h2000-540