"It's called The 'American Dream' because you have to be asleep to believe it." -- George Carlin
I am sorry to have to post on this but it in unconscionable for me not to communicate my feelings on the loss of the American Dream. Though there were some like Madoff who broke the law, mostly Americans gave it away through the democratic process. Leaders were elected, allowed to be corrupted by ego, power and greed and then manipulated public opinion through carefully constructed media messaging.
Summary
I believe Americans have not felt enough pain (like in the Great Depression) to regulate the fundamental structure of financial services and bring back the middle class.
The best we can hope for is Elizabeth Warren and others with the integrity the brains or both to interpret enacted reforms to the most extreme. That appears unlikely; given the stack of lawsuits and lawyers that will be thrown at them by investment banks.
Our situation will not improve until taxes are raised on the super-rich, entitlements are cut, people feel the pain and the middle-class returns. If the super-rich threaten to leave the country; make em prove it. And maybe somewhere along the way we re-learn how to produce things and not consume.
1929 The Crash of 1929
At first people blamed the government for that crash too (are you listening Tea Partiers?). But now we know better it was manipulation of buying on margin (equivalent of credit)- As Joe Kennedy said, he "knew it was time to get out when he received stock tips from a shoe-shine boy." The implication of this is that every sucker that could be taken for their money however small the amount, had it sucked out of them.
- 1933 Glass-Steagall Act - kept the economic growth in check through separation.
- 1979 "In a nation that was proud of hard work, strong families, close-knit communities, and our faith in God, too many of us now tend to worship self-indulgence and consumption. Human identity is no longer defined by what one does, but by what one owns. But we've discovered that owning things and consuming things does not satisfy our longing for meaning. We've learned that piling up material goods cannot fill the emptiness of lives which have no confidence or purpose." --Jimmy Carter. -7/15/79
- 1987 Wall Street The Classic Rationalization of Greed
- People were promised all things from Reagan if we jest believed in supply side economics ("trickle down" or "tinkle on" depending on your perspective)
- Instead the super rich (top 1%) grew until they could not stuff their pockets anymore; the "shoe shine boy" had bought a $500K home . The super-rich bolted and the middle-class fell apart. Source here
1999 S. 900: Gramm-Leach-Bliley Act - Open up the gates of greed.
- 2001 Bush asks Americans for "continued participation and confidence in the American economy" linking consumerism to an American duty instead of a choice
- 2003 S. 811: American Dream Downpayment Act - get people to borrow well beyond their ability to pay
- 2003 H.R. 1: Medicare Prescription Drug, Improvement, and Modernization Act of 2003 - Prescription drugs, largest unfunded entitlement in history… more than Medicare itself at time of enactment
- 2003 War of choice in Iraq that was supposed to be in part paid for by Iraqi Oil revenue
- 2005 S. 256: Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 - but make it harder to go bankrupt http://www.americanprogress.org/issues/2008/04/bankruptcy_column.html
- 2006 The Smartest Guys in the Room Enron: A one Company manifestation of greed
- 2006 Maxed Out - the masses are duped into a false sense of self-worth being associated with consumerism
- 2008 I.O.U.S.A. - more blind consumerism to the point of total financial insanity
- 2008 H.R. 1424: Emergency Economic Stabilization Act of 2008 - And then they ask to get bailed out to continue the abuse. Like giving drugs to the addict
- Rubin left us Summers and Geithner; like vultures on the carcass of American economy
- Feb 17, 2009 Inside the Meltdown
- March 24, 2009 Ten Trillion and Counting
- May 9, 2009 The Madoff Affair
- June 16, 2009 Breaking the Bank
- October 20, 2009 The Warning
- Nov. 24, 2009 The Card Game
- 2009 Most difficult to stomach - Capitalism: A Love Story
- 2009 David Walker (I.O.U.S.A) spoke to Milliman in March 2009. I asked him the following question: "Your premise is our nation has lost its way and overspending. If so, why not advocate balanced budgets and entitlement cuts to the point we sink into a depression. Would that not be the fair thing to do in the eyes of our children?" On the contrary, Mr. Walker felt TARP and some stimulus spending was necessary in this situation. So even one of the biggest believers in restrained spending could not face the idea of really going without. And the deficits keep on rolling
- Mind over Money - The need to change from Rational to Behavioral Economics and institute reform.
- 2010 And now Financial Regulation emasculated: S. 3217: Restoring American Financial Stability Act of 2010
- Volcker "People are worried, and should be"
- World's wealthy sitting out while the carnage roll on
- Resolution of Key Issues on Financial Regulation
- http://www.rollingstone.com/politics/news/12697/64796
- http://www.nytimes.com/2010/06/26/us/politics/26regulate.html?_r=1&hp
- In my opinion, and that of 4 out of 5 Americans see the financial regulation about to be passed as terribly ineffective.
Through some bizarre twist of fait I am a part of and benefitting from financial services work. Thankfully Milliman is intensely focused on business ethics and doing the "right thing" not the what makes the most money; those are not always the same thing.
I appreciate and work very hard in my job and give money and time to as many causes as possible. Of all the lines on my taxes, Line 17 (charitable giving) is most special; far more important than Tina and I's AGI.
My future is to demonstrate to my kids how to:
- Reduce consumption
- Maintain a skeptical awareness of their ego
- Recognize media messages fueling consumerism
- Travel internationally
- Live frugally, simply and in peace (God willing)
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