Bill Black: Romney’s Lead Economist Urges Policies that will Cause the Next Financial Crisis

Bill Black, the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City. Cross posted from New Economic Perspectives.

Presidential nominees of either U.S. party can secure economic advice from any economist in the world. This makes it all the more amazing and sad that they choose economists with track records of disastrous policy advice.  Bill Clinton chose Robert Rubin, George W. Bush chose Gregory Mankiw, Obama chose Lawrence Summers, and Mitt Romney chose Mankiw.  Rubin and Summers led the Clinton administration’s efforts to gut financial regulation.  Mankiw led the efforts under Bush.  Collectively, these efforts created the criminogenic environment that produced endemic financial fraud (“green slime”).

Mankiw Morality

I have often emphasized the importance of George Akerlof and Paul Romer’s 1993 article (“Looting: the Economic Underworld of Bankruptcy for Profit”) to understand the economics of why we suffer epidemics of accounting control fraud and recurrent, intensifying financial crises.  Mankiw was the “discussant” when they formally presented their paper.  I was also present at their invitation.  Mankiw was unconcerned about looting.  It was my first introduction to Mankiw morality:  “it would be irrational for savings and loans [CEOs] not to loot.”  I was appalled, but my outrage at Mankiw paled when I observed that the members of the audience, professional economists, were not even made visibly uncomfortable by such a depraved response to elite fraud.  CEOs owe fiduciary duties to the shareholders.  Mankiw’s response to the findings that CEOs were looting their shareholders was to praise the rationality of the fraudulent CEOs (if you don’t loot you aren’t moral – you’re insane).  One cannot compete with theoclassical economists’ unintentional self-parody.

Mankiw Still Loves the Regulatory Race to the Bottom that Breeds Endemic Green Slime

Mankiw wrote a column in the New York Times praising competition among governments.    

I start with a historical note that falsifies Mankiw’s claim that competition among governments is desirable.  Mankiw makes an historical argument for his claim that competition among governments is desirable and notes that the “founding fathers were no fools.”  In an odd way, we can thank our immensely successful Constitution to the demonstrated disaster produced by governmental competition engendered by the Articles of Confederation.  The States competed vigorously – to aid their merchants at the expense of “foreign” States (their neighboring States).  They competed to impose more destructive internal tariffs (and other trade barriers) so aggressively that they crippled commerce.  This is one of the principal defects that led the committee appointed to reform the Articles to instead junk them and adopt our Constitution.  The Constitution created a nation instead of a confederation.  The interstate commerce and supremacy clauses were key provisions of the new Constitution because the framers knew that competition among the States and the new federal government could threaten our nation’s survival.

In the context of public finance and financial regulation Mankiw’s praise for such competition demonstrates that he has learned nothing useful from our recurrent crises.  This column discusses why competition among governments in financial regulation leads to the criminogenic financial deregulation that produces the epidemics of green slime that drive our financial crises.  I have recently explained, in the context of opposing the JOBS Act, why the “regulatory race to the bottom” is an oxymoron designed by regular morons.

Mankiw read these words 19 years ago, but he has never understood what Akerlof and Romer were saying, even though they ended their article with this paragraph in order to emphasize their key policy message.

“Neither the public nor economists foresaw that [S&L deregulation was] bound to produce looting.  Nor, unaware of the concept, could they have known how serious it would be.  Thus the regulators in the field who understood what was happening from the beginning found lukewarm support, at best, for their cause. Now we know better.  If we learn from experience, history need not repeat itself” (George Akerlof & Paul Romer.1993: 60).

Competition among governments in the financial deregulation context leads to a “race to the bottom” that produces devastating financial deregulation.  The resultant financial deregulation is “bound to produce looting.”  An economist should have no difficulty understanding this point, for classical economists stressed hundreds of years ago that the government’s central function is to prevent crime of force and fraud.  Even Ayn Rand called for the government to prevent fraud.  Because, as Akerlof and Romer stressed, accounting fraud produces a “sure thing” creditors do not exercise effective “private market discipline” against such frauds.  Instead, they rush to fund the frauds’ rapid growth.

Worse, as executive and professional compensation has become far larger and more perverse, creditors and purchasers can grow wealthy by adopting a “don’t ask; don’t tell” policy designed to ignore even endemic fraud.  Charles Calomiris, who is as culpable as any economists for spreading financial deregulatory dogma globally, suggests that the perpetrators may have deliberately created “plausible deniability.”

“asset managers were placing someone else’s money at risk, and earning huge salaries, bonuses and management fees for being willing to pretend that these were reasonable investments. [T]hey may have reasoned that other competi[tors] were behaving similarly, and that they would be able to blame the collapse (when it inevitably came) on an unexpected shock.”

“Who knew?”

In combination, deregulation and perverse compensation are so criminogenic that they can produce green slime in such massive amounts that slime dominates massive aspects of finance.

Mankiw tries to dress up the question of whether governments should compete as a philosophical dispute about the proper role of government.  That is incorrect in the financial regulatory context.  The regulators have to serve as the “cops on the beat” – and economics has emphasized for centuries the essential need for the government to provide such a rule of law and limit fraud and violence.

We know objectively that Mankiw, Bush, and Romney do not actually favor competition in financial regulation – for none of them opposed the OCC and OTS’ scorched earth campaign to preempt state efforts to regulate predatory lending and seek to reduce mortgage fraud.  The states attempted to offer a competitive alternative to Mankiw, Greenspan, Bernake, and Bush’s indifference to fraud by elites.  That competition could have led to vastly better outcomes for the citizens of the States that wished to be most vigorous against fraud and the nation.  Mankiw was Chairman of Bush’s Council of Economic Advisors during the worst excesses of the federal agencies efforts to prevent the states from regulating entities (e.g., bank holding company affiliates not subject to federal regulation) that spread the green slime through the financial system.  He did not oppose preemption.  Mankiw and his political patrons do not favor competition in financial regulation – they favor regulation so weak that it will be ineffective.  They hate financial regulations that are successful because such regulations challenge their world view that denigrates democratic government and government regulators.

Romney’s choice of Mankiw, one of the leading architects of and apologists for the crisis, as his leading economic advisor would be a superb issue for Obama to use in his reelection campaign but for one tiny problem.  The Obama administration’s policies on financial regulation are created by the likes of Rubin, Summers, Geithner, and Bernanke.  They differ only on the margins from Mankiw.  The entire crew of leading economists for the last three Presidents and Romney has proven catastrophically wrong about financial regulation.  The remarkable thing is that they do not drop their dogmas even after they engineer multiple crises over the course of three decades.  We will soon experience the 30th anniversary of the Garn-St Germain Act of 1982, which set off a renewed “competition in laxity” among the States (principally California and Texas; whose S&Ls, collectively, caused roughly two-thirds of all S&L losses) and produced the criminogenic environment that led to the second phase of the S&L debacle.

There are economists and scholars from other fields that have track records of success as financial regulators.  Note to Obama and Romney:  there is no rule requiring you to choose as your leading advisors the purveyors of green slime and crisis.  A significant number of Mankiw’s students walked out of his class to protest his presentation of failed dogma in the guise of economics.  It is time for all of us as citizens to walk out on politicians who choose ethical and economics failures like Mankiw and Geithner as their advisors.

Bill Black is the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City. He spent years working on regulatory policy and fraud prevention as Executive Director of the Institute for Fraud Prevention, Litigation Director of the Federal Home Loan Bank Board and Deputy Director of the National Commission on Financial Institution Reform, Recovery and Enforcement, among other positions.

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  1. readerOfTeaLeaves

    It is time for all of us as citizens to walk out on politicians who choose ethical and economics failures like Mankiw and Geithner as their advisors.

    Oh, and IIRC Glenn Hubbard is another of Romney’s key economic advisors. I presume Romney didn’t make time to watch “Inside Job”, a movie that Mr Obama might want to move to the top of his Netflix queue.

    Thank God for INET; it gives me some hope.

  2. Hugh

    Did anyone expect a kleptocrat like Romney wouldn’t hire a whore for kleptocracy like Mankiw? That was pretty much baked into the cake. And of course Team Obama is no better and in many ways worse because he not only embraces Republican excesses, he legitimizes them. And as with his attacks on Medicare, Medicaid, and Social Security, he expands on them.

    1. readerOfTeaLeaves

      Well, hey – nothing says, “The future I offer you IS an redux of the past” like hiring Mankiw.

      FWIW, I just clicked over to Ritholtz’s (Big Picture) and had some good chuckles over a guest author’s smackdown of academics – a la Mishkin (who is also in “Inside Job”) – fussing and fretting that HFT (High Frequency Trading) is acceptable trading behavior.

      How soon do we get to start calling Romney Bubble Boy?

    2. Doug Terpstra

      As with Romneycare and Obamacare, there are negligible policy differences between the two, but Obama will be far more effective in getting Shock Doctrine done. This is why key New Deal conerstones like Social Security are at far greater risk under an Obama regime, and there is no doubt that it and Medicare are his priority targets.

  3. josep

    Either party will keep us in the same mess, or worse. Both parties have their pockets lined by TBTF and MNCs.

    We get the government the very wealthy pay for.

  4. Susan the other

    What is at stake is the rule of law and the enforcement of the rule of law. If the rule of law is not enforced, we have no law. Period. If the nervous parties are trying to wait it out, until the rule of law is more nuanced, then they will get away with blatant fraud.

  5. Hugh

    I think the one place I would disagree with Bill Black is here:

    “The entire crew of leading economists for the last three Presidents and Romney has proven catastrophically wrong about financial regulation”

    This is a matter of perspective. From the kleptocratic perspective, they weren’t wrong at all. Kleptocracy has been flourishing since Carter and deregulation has been a major reason why. As agents of kleptocracy, the cadre of leading economists were right to stress the importance of deregulation. And they were richly rewarded for doing so.

    1. lambert strether

      What Hugh said. Like saying a shill is “catastrophically wrong” after the shill lures a mark into a rigged game, and then takes a cut when the mark loses there shirt.

      Where’s the catastrophe? “I’ll be gone, you’ll be gone,” or more precisely, “I’ll be on the Vineyard this summer, you’ll be on the Vineyard this summer.”

    2. scraping_by

      You’re pointing out a home truth: theft can be seen as a zero sum game, the thief wins and the victim loses.

      But in a longer term, of course, the elite create a world they don’t want to live in. There are only so many people stupid enough to be loyal retainers, some many stores of value to loot, so many good runs to hook into.

      If it was just separating the honest but clueless from their life savings, hit and run works. But the real world is a long term proposition.

      1. albrt

        My view of history suggests there is an unlimited supply of loyal retainers at the right price.

        The supply of easy, willing marks is more likely to be constrained at some point. This will make it harder to pay the loyal retainers. Then a diminishing return dynamic is triggered as the system must extract rent from marks who are less eager, and eventually downright unwilling.

        I think we reached “peak marks” in November 2008.

    3. Old Soul

      Franklin Delano Roosevelt famously said, “Yes, we are on our way back— not just by pure chance, my friends, not just by a turn of the wheel, of the cycle. We are coming back more soundly than ever before because we are planning it that way. Don’t let anybody tell you differently.”
      This applies equally to the plan to deregulate the financial powers so that they can take whatever they want with a stroke of the pen (now read as a keystoke on the computer and where physical documents are required: with a robo-signature.)

  6. GeorgeNYC

    I wonder if Greg Mankiw would ever apply economic analysis to his own position? Would he ever consider if his own policy prescriptions were influenced by his own economic interests? That he himself is offering “competing” ideas? Or does economic analysis only work when one is considering how to control lesser beings?

    Are we really debating anymore? Are there really two “sides” or are there just those sitting outside the mainstream screaming at the top of their lungs while no one inside even cares. (That is until their direct economic interests are affected in which case they scream like hell for a government bailout or else the World IS Going To End). ).

  7. Foppe

    I was appalled, but my outrage at Mankiw paled when I observed that the members of the audience, professional economists, were not even made visibly uncomfortable by such a depraved response to elite fraud. CEOs owe fiduciary duties to the shareholders. Mankiw’s response to the findings that CEOs were looting their shareholders was to praise the rationality of the fraudulent CEOs (if you don’t loot you aren’t moral – you’re insane).

    While I agree with you on your larger point, I think it is important to also stress that the entire notion of “shareholder value maximization” is hugely problematic (encouraging short-term profiteering/looting in the name of the shareholders). If you want to get at what’s wrong with Mankiw’s argument, I think it is important to start there, and to dismantle the idea that acting in the name of maximizing shareholder returns is what companies should (be required to) strive for; as shareholders are little more than looters ever since shareholding was “democratized”.

  8. Doesn't This Make Anyone Mad?

    So…I guess on the campaign tour R says, “And let me introduce my advisor…the man that brought us the Bush Economy…right up until Obama took over in 2007…and put in whos-his-name…I don’t want to deride the fine work whos-his-name did during the Obama Depression…I may have to hire him after I fire Greg…hahahah…little econ trade joke there…excuss me while I wipe my nose with this hanky here…sometimes I crack myself up so bad I blow snot all over the place…excuse me, excuse me…”

  9. Eric L. Prentis

    It is IMPOSSIBLE to rekindle “animal spirits,” living on George Orwell’s Animal Farm—where “all animals are equal, but some animals (pig banksters) are more equal than others.” Ten thousand banksters deserve to be in maximum security prison.

    But Wall Street banksters pay protection money to politicians, so we have a loss-of-trust and a shitty economy. I call this a lousy tradeoff.

  10. Jessica

    I greatly appreciate Bill Black’s work. However, I do with he would stop pretending that the problem is a poor choice of advisers or Obama or Romney ever were or would be free to chose advisers who are not propagandists for the kleptocracy.
    After a while, it is too much like research into “Inexplicable Preferences of Attractive Young Thai Prostitutes for Older, Physical Unattractive Partners”.

    1. Jessica

      I do wish I would do a better job editing or be able to edit posts after posting them.

      However, I do _with_ he would stop pretending that the problem is a poor choice of advisers or Obama or Romney ever were or would be free to chose advisers who are not propagandists for the kleptocracy. —>
      However, I do _wish_ he would stop pretending that the problem is a poor choice of advisers or Obama or Romney ever were or would be free to chose advisers who are not propagandists for the kleptocracy.

      1. steelhead23

        Oh Jesse, we got it the first time. But I must admit that research dealing with the inexplicable preference of Thai prostitutes… sounds like fun reading. Bill Black and financial corruption – not so much. But your analogy is quite clear – the reason pretty prostitutes like unpretty men is money and the reason Romney likes Mankiw is Mankiw brings in money.

        1. Procopius

          Well, I live in Thailand, and when I was younger I became acquainted with some attractive young Thai prostitutes, and I can tell you that from the Thai cultural perspective there is nothing hard to understand about their preference for older less-attractive men. They invariably display the personal quality the Thais call “good heart” (generosity) and the Buddhist ideal of compassion. They really, really just want to ease the suffering of the comparatively wealthy but unattractive older men they meet at their places of employment. Oh, by the way, I have this bridge over the Chao Phraya River…

      2. Up the Ante

        I have determined the only reason people misspell here is the influence of another replying to their comment in the near future.

        This here, is what caused your typo,

        this evidently is typical of the Mankiw-fraud,

        ” #5: This year I will not be tempted to bash the Fed. Ben Bernanke, soon to be the new chairman of the Federal Reserve, will not inherit Alan Greenspan’s halo, and so may be a tempting target. But I will resist temptation. I know that the U.S. has an independent central bank for good reason. I know that sometimes the Fed needs to raise interest rates to fight inflation, even if it risks slowing growth in incomes and employment. I will let Mr. Bernanke and his colleagues do their job. Difficult as it is, I will hold my tongue. ” [ that turned out well, hey ? ]

        and why this guy’s blog is visited is a mystery, it’s trash !


  11. craazyman

    Professor Black deserves a Nobel Prize just for coming up with “Green Slime”. It’s perfect. It cracks me up, until I start thinking of all the morons who spew it. And it makes a lot more sense than multivariate regression analyses of time dependent economic variabulls like productivity and efficiency. When you’ve got green slime on your side, who needs to worry about getting the numbers right? hahaha.

      1. craazyman

        I bet if you fried it, it wouldn’t be bad.

        Growing up we used to eat something called “scrapple”. It was a southern breakfast thing. I think they took a backhoe and scooped up the live pig, the mud, the hay, barnposts and pig sh*T and put it in the industrial strength grinder — and out came scrapple.

        I liked it.

          1. Bill the Psychologist

            The French have another dish that could be called Head Cheese — Tete de Veau (imagine the circumflex over the first “e”).

            I tried it in Metz, didn’t like it at all, the only French dish I ever ate that I didn’t like (including a horsemeat burger from a stand at a grocery store parking lot in Alsace – delicious).

        1. ambrit

          Dear craazyman;
          My parents were Londoners, so we ate a breakfast treat they called “Bubble and Squeak.” I loved it. Basically, everything left over from last night with an egg scrambled in. A Scrapple analogue? Which goes to the larger obversation; Start kids off on something early enough, like criminogenic business practices in college, and you end up with ‘bent’ businesspeople. Every competent revolutionary knows that the two institutions you take over first are the Media and Education. Time for us to take them back from the criminal elites. Or, create alternatives that reach a large chunk of the populace.

          1. Old Soul

            It is particularly helpful to undermine the eduational system at the most prestigious universities.

  12. darms

    Mr. Black, I really like your work. But you left out Alan Greenspan, a major contributor to today’s debacle.

    1. Doesn't This Make Anyone Mad?

      Greenspan-Bernanke-Yellen will take us well past Mit’s second term.

      That’s more QE than all the banks in the world can pay in salaries and bonuses.

    1. Capital Frown Lending

      Overqualified for the job. American romanticism aside – the position entails well groomed speech making, intelligence optional. We’re very close to the point were the obessional preening and presentation could be completely replaced with synthetics, a combination of both biological and artificial parts, for greater efficiency.

      1. psychohistorian

        There you go again pinning for Dick Cheney to continue ruling us from the almost dead.

        Is society reduced to advancing one puppet death at a time?

      2. albrt

        Tupak’s hologram is more likely to get elected than Dick Cheney.

        Which means I guess I should have been more diligent about reading those articles on Yahoo.

      3. ambrit

        Dear Sir;
        We here at Magic Kingdom Replicants have a thirty plus year record of sterling accomplishment in this field. Please feel free to contact us to discuss your needs.

        cc: H S Botwatch
        Condottiere Inc

  13. Stuart

    OMG. That’s it folks, we’re done. May as well put a fork in it. Obama’s driving us into the brick wall at 100 mph, Mankiw will drive us into the brick wall at 500 mph. maybe we get to 2015 before it all boils over, tops.

  14. psychohistorian

    Bill Black continues to speak clear truth to power in our day.

    But to what avail?

    It reminds me of the Tom Waits line…”Two dead ends and you’ve still got to choose”.

    Will we ever get another choice?

    How can we make that other choice available for mankind?

    1. F. Beard

      “Life is designed to drive one to his/her knees.”

      Need we wait till we’re in the proverbial foxholes?

  15. rc whalen

    This is an important comment from Bill Black. Nicely illustrates the core problem facing conservatives today, namely fight between advocates of selfishness and free larceny under Ayn Rand banner and traditional American libertarians. The focus on the use of bankruptcy in Bill’s work is also very instructive. Look at Madoff and MFGlobal, both cases where the bankruptcy courts protect fraud thanks to 2005 legislative machinations in guise of bankruptcy reform.

    1. Old Soul

      Or read the orders from the Delaware bankruptcy courts in which corporate nondisclosure is a fine art.

  16. Goin' South

    If you hate Capitalism and want to see that inhuman system brought to an end sooner rather than later, you have to love the likes of Mankiw. Like Blankfein, he’s doing “God’s work.”

  17. Anthony B. Sanders

    Not a fan of Mankiw, but let’s be careful here. There is a big drive in DC to distort resources for political gain (BOTH parties). We are still suffering from the aftermath of Clinton’s National Homeownership Strategy which helped push Fannie and Freddie into risky lending and lots of it. Look at the mess that they made of the housing market.

    So would Mankiw be any WORSE than Rubin, Romer or the Keynesians (Hicks/Hansens)? They are ALL the same.

    1. Valissa

      Yup… meet the new boss same as the old boss. Orwell’s “Animal Farm” allegory is also apt.

      I admit to being a bit surprised to see the title of this post at NC… as if there was some establishment economist of any supposed ideological flavor that would “save” us. My observation is that ideological adherence (actual, not professed) decreases with proximity to power.

  18. Doesn't This Make Anyone Mad?

    Early on in the crisis we did get sort of a savior(s). It was when O appointed Volker to lead the Group of 30 in a post mortem. The Group of 30 reads like a FBI list of the 30 Top Most Wanted Wrongdoers, but surprisingly they developed a very self damning 500 page document confessing their sins and ways to amend for them.

    Unfortunately, all this knowledge went into the purifier known as Washington DC and only a few cartoon fixes are left to still be implemented, if ever.

  19. NewsView

    Schools could do better by teaching critical thinking skills, economics and social studies in a more robust way. However, schools cannot instill the value system. Parents have been taken away from the home working longer hours and less able to give any kind of moral upbringing. People don’t generally talk to their kids about what it means to be a custodian of democracy. Teachers don’t either. As for the media the problem there is that it doesn’t make the enemies it should. There should be greater emphasis on investigative journalism, muckraking and “following the money”. Instead we find most of deep thinking on blogs where, at least before the financial crisis, people scoffed and regarded anyone with very serious, alarming concerns as a conspirator.

    We also need to take a look in the mirror. Too often we avail ourselves to the divisive aims of the propagandists by not questioning the “facts” — historical or potential lies — that we repeat on the faith that they are true because the half-truths of revisionist history are or so common we don’t realize how unhinged from reality they are. Take anonymous and often politically-motivated chain emails. Year after year they are passed on like wildfire, pitting people against each other using false dichotomies. Just recently I was on a blog where a certain renegade presidential candidate was accused of dismantling the Glass-Steagall Act, when in fact this person voted against the undoing of Depression-era banking and Wall Street casino practices.

    When we have people who are willing to go online and spread misinformation through email or on website comment systems that anger and confuse people not over the truth — which is scary enough — but over the misperceptions what hope is there to rally around a common cause and see real reform within our lifetimes?

    We have to move away from the usual right vs. left talking points and begin to think independently based on a deeper spiritual and psychological appreciation for why people in power do what they do. Absolute power corrupts absolutely and that’s true whether the holder is Big Government or Big Business. They are two sides of the same coin, in fact, and neither can exist without the other.

    To support local business, local trade and smaller institutions that are more transparent is the real essence of entrepreneurialism and democracy. Global-size businesses and international banks and government bodies are heading the same direction: WORLD FEDERALISM. Now this is a word you don’t see out there very much. Suffice it to say, the first thing that should stand out are its Utopian promises of world peace and prosperity. It’s bad enough that we have an imperfect social and political system by virtue of the perils of human nature, now we have to introduce the threat of IDEALISTS who consistently underestimate the law of unintended consequences (and that people don’t like being controlled even if it is for their own good).

    The problem with integrating economies and governments is that a large percentage of the population is going to feel suspicious, rightly or wrongly, of their ability to keep it from running amok over people’s right to pursue life, liberty and happiness. One size simply doesn’t fit all, and there is nothing more “one size” than a legal and trade system that favors TOO BIG TO FAIL. I don’t care how many Nobel Prize winners there are in economics. A system that functions like one giant single-celled Ameba is NOT a step forward. And yet that is exactly where global integration in law, trade and governance is headed.

    Democracy and free market ideals don’t thrive in giant bureaucracies where the very presence of scale coupled with complexity all but invites corruption and abuse even as the barriers to entry too often keep the forces of change and renewal — good people — out. A major force that keeps dividing and conquering us from spurring any real reform is this false notion that private is inherently moral and public is inherently wasteful. We hear it all the time: You can’t let government pick the “winners and losers”. And yet somehow we are any better off when we allow businesses, that in some cases rival governments, to do just that? Talk about irony!

    The reality is that BIG anything is going to slide toward inefficiency, which to the man on the street translates into an apparent disregard for the rights or safety of individuals. BIG anything will, in turn, increasingly reflect and promote its own internal culture, which often is very insular and self-serving, which may manifest in the form of less and less patriotism toward one’s own community or country in favor of priorities that are global rather than local.

    If we want a public debate to reach a point where we can arrive at consensus we have to start throwing out our sacred cows to let the chips fall where they may and indict whom they will (even members of our own party or industry). You empower Big Government through Big Business and you enable Big Business to have favorable regulations or lack thereof through Big Government. It’s not the system that’s wrong but the scale of our expectations that have become horribly unrealistic. BIG will never be particularly transparent and that is why BIG will always be at high risk of going wrong where ordinary people and their rights and livelihoods are concerned. This, in turn, is why the single biggest threat to liberty and freedom is the push to globalize markets, to standardize the legal system across state and now international borders; and to force everyone and everything else in between into an increasingly “small world”.

    Having said all this, it is important to remember that the media, the corporations, the bankers, investors, schools and even government ARE people. People will make or break any system. The system isn’t what safeguards us, it is individual morality and sense of fair-play and accountability that makes for a workable outcome (when “workable” is defined by a minimum of corruption and conflicting interests). When we lose quality people with quality values any institution, any system of government or business, is vulnerable to self-necrosis.

    Ultimately if we want to clean up society we have to go back to allowing families to be families with parents that can afford to raise their kids as part of a community, be it faith-based involvement, charity and other modes of teaching one’s children to practice the Golden Rule. If the only function of the family is to feed and clothe the kids to send them off to school so they can learn to become a good worker, that says nothing about their ability to be a good person and a functioning member of a community and culture that needs more than book-learning — a real sense of spiritual groundedness. The institution that has been most under attack by this decades-long process of wage stagnation and free-trade job loss — the reality that forces parents to avail their children’s time more so to the babysitter, the education system and the television is the FAMILY. The real grassroots fix is a renewed respect for the family unit and its role in shaping community. So harried are most Americans and Westerners in general that we’ve concentrated on the bare minimum how to be a good little “worker bee” and when we’re not doing that how to entertain ourselves with little regard for the bettering of our churches, schools, government and other such institutions. We’ll go a long way to fix the political and environmental manifestations of societal breakdown if we restore the sanctity of the home, marriage and family unit first.

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