So, we’re told that “No one saw this coming”—the financial meltdown that is. But, we’re also told about how the thing actually happened: a bunch of guys sold bad mortgages to people who couldn’t afford them (subprime mortgages or, the real term, predatory lending) and then bundled up thousands of these suckers to sell and trade in hedge funds, apparently “making” these bankers all sorts of cash-money. Now, Wall Street wants to claim that they had no idea the economy was going to collapse from this when fraud charges are hardly unheard of (it seems that our fraud laws have simply been designed to be too weak to actually make a difference). One side note that’s so astonishing, no, galling in all this is that these guys still claim to be “our best and brightest.” And yet—and yet—the simplest of economics shows just how leaky the ship they were building was. We know enough about how capitalism works to not be so naïve to believe that the poor they lent subprime mortgages to were not going to lose their jobs. For them to claim that they didn’t know predatory lending was dangerous is beyond belief. It’s a leap that I cannot make for Wall Street. But, I’m afraid, a lot of other people who matter can.
Now, I realize a lot of my frustration has to do with trying to find who to blame: Wall Street or the, arguably, shmucks who took out varying-rate mortgages. I don’t want to argue that those people, with low incomes, should have been taking out those large mortgages. Of course they shouldn’t have given their economic position as part of the lower class in a capitalistic system. But, this is to imply that they also should probably have the chance, in an objective world, to live in a decent home that they can call their own given the huge wealth disparities (not to mention the thousands of vacant homes around the country—to have homeless people or so many renters is embarrassing for the “richest” country in the world). However, the people whose job it is to understand how our complex economic system works in all its varying ways had the responsibility, the moral responsibility as citizens of our nation-state, to not practice what amounts to predatory lending and, secondly, to see this coming. If they couldn’t do that, find something else to do. You’re useless. They should have known the risks. And I think they did—if they would have ever bothered to stop for a second and consider them.