Fed Chairman Ben Bernanke said that the Occupy Wall Street movement has justification for its frustration that the financial sector brought the house down as the cause of our economic problems.
The subprime mortgage disaster that brought the banking system to its knees, cost the country a couple trillion dollars; yet no one was held criminally responsible for it.
Wall Street goes on its merry way claiming its bonuses, while millions of Americans have suddenly seen their path of upward mobility cut off. Why no indictments?
Asked that question, President Obama said that no laws were broken. The financial disaster was legal. How is that? Because the financial sector pays million of dollars to lobbyists and donates to political campaigns to see to it that no laws or regulations stopped them from pursuing their “economic opportunity.”
It is too bad that it broke the country when their gambling bets went bad. Republicans and Democrats are complicit in this.
What is the biggest welfare program being administered by the federal government right now? Is it food stamps? No. Is it Pell grants, or social services, medicare, or outright social welfare? A lot of my GOP friends think it is all of the above; but the ones benefiting from the biggest social program today, vote Republican.
The Fed’s monetary policy keeps interest rates on deposits and fed funds near zero, so the banks can lend to the Federal government or to anyone they can get to pay them more interest and literally glean hundreds of billions of dollars in profits from the yield curve created for them.
This was done to recapitalize the distressed banking system. It is working. The banks are being healed, but the other sectors, such as the unemployed, have yet to see the same result. As a consequence of the economic disaster, the Fed has implemented the biggest bank welfare bailout in the history of the world.
Big banks, more than little banks, took the economy down, but little banks get the resulting bank bailout being administered by the Fed, just like big banks. Little banks are sensitive to being lumped in with big banks as they didn’t do the crime, but they are sharing the take from it. Little banks didn’t get Troubled Asset Relief Progam payments, but they do get nearly free deposits. This massive bank welfare program is being done because it is a necessity.
The banking system has to be capitalized and functioning for the economy to be capitalized and functioning. Frankly, I think this is where the Occupy Wall Street movement and Tea Party actually agree on something. They both find the federal government bailout of the 1 percent revolting.
I give Bernanke kudos for understanding the public mood that has manifested into the Occupy Wall Street movement. Republican Congressional leadership calls it a mob, or dangerous class welfare uprising.
There is no class war going on. The 1 percent already won that war. The statistics show the concentration of the wealth as high as it’s ever been in the history of the country as 20 percent of the people get 85 percent of the wealth.
They have the wealth; they get income and get treated favorably on taxes. They pay the lobbyists and fund the political campaigns to protect their control of government. Unions have been busted.
Regulation is being beaten back. The class war of the last 20 to 30 years has been won by the 1 percent. They own and control the system. What we are seeing now is a modest political revolt, a mild insurgency so to speak. Some of that lower class, economically, who not having a job, have the time to cause trouble, going to protest rallies.
Herman Cain’s retort that the reason these people are poor is because of personal failure probably won’t play well in the general election. If these people have the gumption to come to a rally, they are probably functional if given a job opportunity.
The 1 percent now have the wealth and, according to Michelle Bachman, it’s all their money, not the government’s money. She said that every dollar we make is ours and when the government taxes us, it is essentially stealing our money from us.
I do well enough financially. I don’t feel that way. I don’t feel overtaxed or that the government is stealing from me. This is a great country. I feel a responsibility to fund the government that protects me, and I am grateful to the country for providing the opportunities that my family and I have as Americans.
This mindset that every dime I make is mine, all mine, and they are dammed if they should tax me for some of it, is crazy. I am not saying that my taxes are too low and that I am asking to have them raised. If Buffet wants to pay more taxes, he should. The dysfunctional government is not utilizing the tax revenue that it gets as effectively as it could.
You have to have an income in order to pay income taxes. However, we do see significant instances of corporations and individuals, through lobbying efforts, gaining favoritism from congressional tax authority via deductions and exemptions that pay little or no taxes on income, circumventing their tax obligation. We need more taxpayers.
Instead of the wealthy in this country isolating themselves like institutional bankers to beat back the barbarians at the gate, it is wiser to economically integrate the classes so that there is a path of upward mobility wide enough to function.
The Occupy Wall Street movement has set off alarms that the wealthy in this country now realize that they will be compelled to respond to.
Bernanke gets it, but there are a lot who don’t.
David Kruse is president of CommStock Investments Inc., author and producer of The CommStock Report, an ag commentary and market analysis available daily by radio and by subscription on DTN/FarmDayta and the Internet.
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