Crisis

Anyone who is surprised by the current financial crisis hasn't been paying attention. From Wall Street's financial mavens to Main Street's craven mortgage brokers, everybody's been playing a giant confidence game. It's a pyramid scheme built on a base of bad loans, a multi-level marketing plan gone one level too far. In the game of risk vs. reward, the risk got too high -- because the rewards were so large as to be irresistible. And you and I, fellow taxpayers, are expected to bail out those gamblers who bet and lost billions (if not trillions) of dollars they didn't really have.

This financial crisis was totally predictable. All bubbles burst, eventually; a house of cards inevitably falls. That the high-stakes gambling and sub-prime lending went on so long speaks as much to unbridled greed as it does to the lack of governmental oversight. Somebody should have stepped in and said "no," but nobody did. In the Bush world, big government is bad when industries need regulating -- but good when bailouts are needed.

Should we, the taxpayers, bail out those firms that gambled and lost billions dealing with various forms of financial securities? Put it another way, would a big Las Vegas casino step in and write a big check to its biggest losers? I don't think so; you place your bets and you accept the consequences. The gamblers on Wall Street should be held no less accountable than their counterparts in Sin City.

If anybody needs bailing out, it's the consumers who were flim-flammed into taking out mortgages that they didn't need or couldn't afford. How many inexperienced potential homeowners got talked into interest-only mortgages that would blow up in their faces a few years down the pike? How many naive current homeowners were tricked into taking out home equity loans for 125% of their property's value? One could argue that these people signed their own fates, but with so many snake oil salesmen masquerading as mortgage brokers, somebody should have overseeing what was going down.

Yes, it all comes down to greed. And as many have stated, you can't legislate greed. (Some have even gone so far as to say that greed is a good thing, that it drives our capitalist society; I might argue with that.) But here's the thing: Unbridled greed does great harm. So while we can't regulate greed, we can control its effects. When outsized greed affects individuals, markets, and countries to this degree, we need to put regulations into place that limits the harm this greed can do.

In doing so, however, we don't need to put even more unfettered control in the hands of the Executive Branch. Excuse me for being just a little bit paranoid, but could this whole "crisis" be just another excuse for consolidating Executive power?

Exhibit A: Section 8 of the proposed bailout plan, which says that the Secretary of the Treasury (an appointed -- not elected -- official in the Executive Branch) has total unanswerable control. Here it is in full:

Sec. 8. Review. Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.

Got that? The new Financial Czar can do anything he wants and nobody -- not Congress, not the Supreme Court, not nobody -- can question him. Sound familiar? It's a common refrain in the Bush presidency.

So maybe the government does need to inject some funds into the financial markets. Maybe some firms do need some sort of bailout. (Heck, some individuals need a financial helping hand, too.) And maybe (or most definitely) we do need more stringent controls over high-stakes financial gambling going forward. But we don't need to further eviscerate the Constitution to give the Executive branch unstoppable powers to deal with this real or imagined crisis. Let Congress take its time and put together a plan that helps those individuals that truly need help -- and doesn't reward the fat cat financial "wizards" who gambled too much and unwisely.

But that's just my opinion. Reasonable minds may disagree.