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Politics : View from the Center and Left -- Ignore unavailable to you. Want to Upgrade?

To: Dale Baker who wrote (105152)	2/28/2009 12:58:59 PM
From: Sam	Read Replies (1) \| Respond to of 540884

What is amazing to me is that these Ayn Rand people think that the government is to blame for this (especially of course Frank and Dodd via FRE and FNM), and fail to see that the Big Investment Banks (counting companies like AIG as a "Big Investment Bank," as well as the investment bank arms of the commercial banks) were the active culprits, even in an ideal Rand sense. The govt is the enabler culprit, for sure, and allowed this fiasco to happen, but the ones who actually did it were the guys like AIG's Cassano in London (fittingly an alum of Drexel Burnham--man, that company spawned an incredible number of frauds!). Who, admittedly, couldn't have done what he did without a lot of other enablers and participants who went along with his money-making schemes.

To: Dale Baker who wrote (105152)	2/28/2009 1:10:34 PM
From: cosmicforce	Respond to of 540884

Imagine that your neighbor wanted to open a uranium mine. Free market would say that as long as the market pays them for the uranium and your ability to sue them acts as a counter, the system would work and the efficient application of market dynamics would pull the uranium out now, pay the preferred shareholders, and then you'd expect the neighbor's shell corporation to go bankrupt about the time your lawsuit got through the legal system. This is the fallacy of the free market argument. Nobody would be willing to live in the mining town of 1840s today except due to financial desperation. The people that became rich in California as a result of mining were actually very small in number. A few individuals who were willing to play very rough gained control of most of the profitable claims and left massive environmental damage that persists today, almost 170 years later. The workers in these mines were not well paid in absolute terms. Our banks were run as casinos and the house paid themselves well using salaries and performance bonuses, until the bill for the big stakes final bet came due, then not so surprisingly all that was left was stock certificates. I personally support going after executive bonuses paid as far back as the statute of limitations would allow, based upon a fraud argument. If someone claims earnings for 5 years and then on the 6th year leaves a bankrupt shell, that is clearly not a profit. Any earnings based upon future value of assets that were inflated are fraudulent. We might not be able to get the salaries back but merit bonuses for performance should be returned as 100% liabilities owed to the shareholder.