Monday, September 15, 2008

1932 Redux?

By now you're all aware of the latest financial calamity coming out of Wall Street with Lehman Brothers declaring bankruptcy and Merrill being bought out by Bank of America. Meanwhile, the American Insurance Group is teetering on the abyss and forced to lean on their subsidiaries for $20 billion in loans.

One has to wonder if standard depository banks are also endangered. The Federal Deposit Corporation (FDIC) created during the New Deal era is ultimately just an IOU. If this financial calamity however extends to depository banks all of us are in serious trouble. Thankfully, depository banks are subject to more regulation and have avoided calamity so far. But for how long can they remain immune?

Was it so long ago that George W. Bush and his plutocratic soul mates such as John McCain advocated for putting Social Security into this morass? If Republicans had their way, millions of elderly Americans would be confronting poverty right now.

Our current mess is the direct result of conservative ideology that pushed for the deregulation of the financial services sector. Consequently we're on the same path of economic catastrophe that we found ourselves in 1932 when FDR first ran for president.

With Barack Obama we have some hope. John McCain only offers more lipstick for pigs.

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