Excerpted from “Are Lapses Of Best And Brightest Prelude To Our Decline And Fall?”, Hansen, February 12, 2009
Certainly you’ve noticed the ads on radio now blaring out how to renegotiate our mortgages, how to avoid paying the IRS and how to walk away from freely incurred credit-card debt. We hear not to trust in mutual funds or even banks — but instead, like medieval hoarders, to revert to the age-old safety of gold.
An unraveling of the system ?
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Most historians agree that earthquakes, droughts or barbarians did not unravel classical Athens or imperial Rome.
More likely the social contract between the elite and the more ordinary citizens finally began breaking apart — and with it the trust necessary for a society’s collective investment and the payment of taxes. Then civilization itself begins to unwind.
Today, you can take your pick: On the one side, we have free-market capitalists (think O’Neill, Raines, Fuld) who took huge amounts of money as their companies eroded the savings of tens of millions; on the other, we have supposedly egalitarian liberals who skipped paying taxes (think Rangel, Geithner, Daschle).
The result is the same. Our best-educated, wealthiest and most connected in matters of finance proved our dumbest — and our political leaders were less than ethical in meeting their moral responsibilities as citizens.
If ordinary Americans were to follow the examples of Wall Street and Washington elites, the nation would neither collect needed revenue nor invest its capital. All of that is a recipe for national decline and fall.
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The former “masters of the universe” who ran Wall Street took enormous risks to get multimillion-dollar bonuses, even as they piled up billions in debt for their soon-to-be-bankrupt companies.
Financial wizards like Robert Rubin at Citicorp, Richard Fuld at Lehman. and Franklin Raines at Fannie Mae — all of whom made millions as they left behind imploding corporations — had degrees from America’s top universities.
They had sophisticated understanding of hedge funds, derivatives and subprime mortgages — everything, it seems, but moral responsibility for the investments of millions of their ordinary clients.
The result of such speculation by thousands of Wall Street gamblers was that millions of Americans who played by the rules, and put money each month away in their 401(k) plans and elsewhere, lost much of their retirement savings. Many likely will have to keep working well into their 60s or 70s, and delay passing on their jobs to a new generation awaiting employment.
Yet most disgraced Wall Street elites will retain their mega-bonuses and will not go to jail. Their legacy is having destroyed the financial confidence of a society that depends on putting capital safely away to be directed for investment by responsible overseers.
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Meanwhile, we are learning that the brightest and best-educated Americans at the highest levels of government simply refuse to pay their required taxes.
And they apparently did not pay their back taxes until their Obama appointments put them in jeopardy of public disclosures.
That raises disturbing questions: Would we have known about such tax dodging had our best and brightest not wished career advancement in government? And would they have ever paid up if they had not been caught?
Take your pick: On the one side, we have free-market capitalists who took huge amounts of money as their companies eroded the savings of tens of millions; on the other, we have supposedly egalitarian liberals who skipped paying taxes.
The result is the same. Our best-educated, wealthiest and most connected in matters of finance proved our dumbest — and our political leaders were less than ethical in meeting their moral responsibilities as citizens.
* * * * *
If ordinary Americans were to follow the examples of Wall Street and Washington elites, the nation would neither collect needed revenue nor invest its capital. All of that is a recipe for national decline and fall.
Full article:
http://www.ibdeditorials.com/IBDArticles.aspx?id=319333609341307
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