The Rich are Still Hurting

A commenter on a thread over at TPM Cafe pretty much sums up my own view of the big picture of the financial crisis:

There are massive amounts of money to be made by engaging in the shell game financial industry. Our country lionized those who did that, always hoping some of it would dribble down to us. If that industry had been regulated the economy would have grown at a sustainable rate, fortunes wouldn't have been made, lost, made again in a single day of trading, and our major loss would have been a big reduction in billionaires - don't we need an endless supply of those? We sure acted like we did.

I'm no finance wizard...

I’m by no means an expert in economics, but isn’t the larger story of the financial crisis, the underlying story, something like:

1. The median wage hasn’t kept up with the median home price, or anything else, for 30 years, because the benefits of economic growth have pretty much (aside from a brief two or three years in the late 90s) all gone to the top of the income scale;
2. Rather than address the median wage problem by, you know, raising it, the Powers-That-Be instead;
3. Came up with ever-more-exotic ways to saddle the median worker with ever-more-crushing amount of debt until;
4. The Median-wage-earner-who-hasn’t-had-a-raise-in-years is finally, in fact and predictably, crushed by his ruinous debt?

And now we need to bail out Wall-Street, enablers and cheerleaders of the ones who haven’t given their workers a real raise in years, because otherwise they’ll ruin the economy? Am I missing something or is that about the size of it??

Hunter on the Bailout Plan

The Bush administration hasn't done much in the last eight years to inspire confidence in their ability to handle this -- the concern is that it will function as a corporate giveaway of historic proportions, but in the end do nothing for the economy except propping it up a little while longer. Likewise, there's little stomach for bailing out what essentially turned into a Ponzi scheme backed by the largest players in the financial industry. Yes, they say they need a massive, trillion-dollar influx of cash to patch the crisis they themselves caused via irrational pricings of mortgage-related derivatives. But when someone has proven to be utterly financially incompetent, giving them a trillion dollars in the hopes that they merely don't blow it all too quickly is not confidence-inspiring.