Response to Facebook

Read my facebook wall. Then this blog will make sense. (If you haven't added me as a facebook friend, I don't discriminate.)

1. Concerning the accusations floating around about Rep. Barney Frank and the current economic crisis, follow this link.

2. Concerning whether or not WWII actually got us out of the Great Depression, follow this link. (Warning, it is long and technical, but worth the read.) I have always felt, and the article has only strengthened, my belief that it was a combination of both a wartime economy and certain New Deal programs that eventually lifted us to prosperity after the war had ended. The war provided a huge government stimulus that renewed faith in the economy, while certain New Deal building projects and social safety nets provided the infrastructure that continued us on the path of economic stability for decades.

3. Some economists actually blame the New Deal for prolonging the Great Depression, as you can read in this link. A careful inspection of the article will reveal, however, that it was only certain types of New Deal programs that were to blame, namely lax anti-trust enforcement and artificially-raised wages. I wouldn't have been in favor of either of those things myself. But don't throw out the baby with the bathwater--much of our national highway and parks systems were built through New Deal public works projects, and the foundations were laid to ensure that our senior citizens would not be left in poverty or without medical care (what private insurer would sell a policy to a retired, elderly person?), or that our money wouldn't be lost if our bank happened to go under (FDIC).

4. The political party that has the momentum will almost always get the majority of campaign contributions from big business, because business likes to hedge its bets. It's the financially prudent thing to do. Democrats currently have the momentum (at least they have for the last two sets of elections), and so they got more money. And key players who hold key committee positions in Congress will get even more of that money. I think this link sums it up quite nicely, although it's rather intuitive if you think about it. I mean, that's how I would contribute, if I were running a large corporation.

5. Simply put, the housing bubble was created by getting people into homes by giving them loans that they couldn't afford. Even more simply put, it was created by people being allowed to buy homes they couldn't afford. This had the side-effect of causing everyone's home values to go up way to quick, which created an incentive for a lot of people to try and make major money off of the market, which....led us to the situation we have now. (Wah-wah, a la Debbie Downer). Both parties have been to blame for this. Compare this link with this link. I have always said, even before the housing bubble burst, that people don't deserve to live in homes they can't pay for. You know something is wrong when 95% of the people in California can't afford the 50 percentile home price. Although I didn't know what it would be like when it happened, I have felt for years that the skyrocketing prices in the housing market were going collapse on themselves at some point. Sadly, this is one of the few occasions where I am not happy to be right.

I just want pragmatic solutions (i.e. regulations) to prevent these problems from happening in the future. And I would like politicians from both parties to develop some common sense.