The Credit Crunch: Is It Your Fault?

Victor Davis Hanson had an interesting piece last week that I came across today.  He throws the blame for the sub prime mortgage disaster -well part of it at least- right at your feet.  If you agree with him, a chance to redeem yourself is waiting a short month away.

When the mortgage bubble burst, Americans were “shocked” at how many Wall Street buccaneers had been gambling in a vast pyramid scheme with someone else’s money. Paper fortunes were made buying and selling questionable sub-prime mortgages on the silly assumption that such gargantuan inside profiting would always expand — even as the number of homebuyers able to buy overpriced properties was shrinking.

Now after the recent crash in sub-prime mortgages and the stock of several investment firms, a trillion dollars in “assets” could be nearly worthless…

All that remains of this Ponzi scheme is the election-year blame game. Republicans charge that important financial firewalls were dismantled by the Clinton administration while insider liberal senators got shady campaign donations in exchange for aiding Wall Street. Democrats counter that the laissez-faire capitalism espoused by Republicans for two decades encouraged financial piracy while tax policy favored the rich speculator over the middle-class wage earner.

But no one dares to ask what really drove the wheeler-dealer portfolio managers. Who re-elected these shady politicians of both parties? Who fostered the cash-in culture in which both Wall Street profit mongering and Washington lobbying are nourished and thrive? We citizens did — red-state conservatives and blue-state liberals, Republicans and Democrats, alike. We may be victims of Wall Street greed — but not quite innocent victims.