USA: Economy: Christian political leader blasts American financial & business leadership of 'collapse'

In a recent article, Dr James Skillen (executive director of Citizens for Public Justice USA until October 2009) bristled indignantly, "Can Trust Be Restored?" (Root & Branch (Feb23.2l9).

Let me put it more bluntly. People are not just angry about bankers’ big bonuses and auto company CEOs’ private jets; they are angry that they got taken by “the system” — by banks, by mortgage companies, by investment advisers, and by the government that aided and abetted and gave no warning of the coming collapse. As in a stagecoach robbery, writes Janet Tavakoli, “Wall Street bankers made off with the loot without firing a shot. They were enabled by Washington overseers and financial regulators who—when not beneficiaries of the good times—behaved like ostriches. Meanwhile, news of the fact that no one in the US has been brought to justice has not escaped notice” (Financial Times, 2/5/09). The authorities oversaw and even encouraged the increasing leveraging of debt until the whole country was overextended, leading to the crash. One of the biggest culprits, according to John Kay, was the “diversified financial conglomerates” created after Washington abolished the Glass-Steagall Act that separated commercial and investment banking. The conglomerates, says Kay, “are riddled with conflicts of interest” and their growth “served only the ambitions of the greedy men who ran them and the financial interests of traders, who were allowed to play with sums of money that should never have come into their hands” (Financial Times, 2/11/09). With government having not yet done much to change the system and after several months of trying to prop up all kinds of financial services companies, the hole is getting deeper. Even two months ago, Niall Ferguson could write, the Fed itself “increasingly resembles a public hedge fund, leveraged at more than 50:1” (Financial Times, 12/19/08).