Public Opinion Doesn't Look Down on Smokers [INFOGRAPHIC]

Obviously you're a Lib to the max and no amount of factual information or logic will change your position. You throw around the usual clichè catch-phrases... "Conservative agenda" or "Reagan Bank", etc.

Democrats have controlled congress (and thus spending) for thirty-six of the last fifty years. And I make no excuses for RINO Republicans who tended to overspend as well. (Slightly different agendas and pork handed out a little differently, but very similarly. I think of them as Democrat-Lite.)

"..conservative agenda" since 1980..."

Just what "conservative agenda" was that? Bush was big-spending big-gov RINO. Pro-illegal-alien, pro-Patriot Act, pro-bailout, pro-stimulus, pro-just about everything. Yeah, he was a regular William F. Buckley or Dr. Thomas Sowell. A real conservative guy.

B/t/w...

Anyone who has cared to look at the facts understands the current financial problems were initially caused by the housing-financial melt-down. (Which precipitated the stock-market collapse, which precipitated unemployment, which precipitated... etc, etc like a row of dominoes.)

The housing bubble and its bursting was caused by poor lending practices. Poor lending practices were the result of politicians (generally Democrats but Republicans as well) deciding that raising the percentage of home-ownership arbitrarily was a good-thing, without regard to the ability of those homeowners to be able to afford or maintain payments or their creditworthiness.

Pressure was applied to the lending system (both banks and mortgage companies) to ease the standards of creditworthiness for obtaining their mortgages. They were accused of racism, "red-lining," etc by not granting loans to those who traditionally would not qualify by meeting generally accepted standards (like 10% down, a mortgage that could not exceed approximately 150% of annual income, job security, an established history of good credit, etc).

Lending agencies were "encouraged" to lower these standards to meet the percentages of the government's desired goals. Oversight of this "cooperation" was delegated to local community action groups. The input of these groups was used to grant required Federal approval for banks and lending agencies to open more branches, to expand, to invest in other areas, to merge, etc. Federal permission was refused when they did not meet the criteria and granted only when they did.

Government entities like Fannie Mae and Freddie Mac were created to supposedly ease the risk potential and insure the stability of these loans. Other entities (like AIG) were set up to "insure the insurer." So the lending institutions had to make a choice between being limited in their growth by government denial of expansion, or cooperating (supposedly with "safe" government backed guaranties) and making a great deal of money in the process. Easy choice.

The vast majority of lending institutions decided to "play the game" and give a loan to just about anyone who would apply, ignoring traditional qualifications. As the amount of potential home buyers went up dramatically, so did the value of those homes for sale as the law of supply and demand took effect.

Housing prices rose higher and higher. Lending qualifications became easier and easier. (To the point where virtually anyone with an undocumented car-wash job could qualify to buy an over-valued home worth more than eight times his supposed annual income with zero down, interest-only payments for the first five years with a mortgage given for 110% of the (inflated) value of the home.

Of course in a reality-based financial sense this was unsustainable, but it was supposedly "guarantied" by the government and so the banks, now making tremendous profits, were only too happy to slice-and-dice (packaging the truly safe mortgages with the potentially unsafe mortgages) and schlep off these loans to investors.

The banks made a ton of money, the Wall Streeters who offered the investments for sale made a ton of money, investors (at first) made a ton of money, the guarantors and insurers (like Freddie and Fannie and AIG) made a ton of money, new homeowners had homes to live in well beyond their means and creditworthiness were happy. Politicians whoring for votes were happy (as were their boyfriends, like Fannie Mae's Herb Moses). Everybody was happy...

Until those interest-only mortgage payments began to expire, and those having a home-mortgage to pay for couldn't afford the payments any more. Originally when they got the loan they were often told "When and if you can't afford it, don't worry. Just sell it. Prices are only going up. You'll get out of it with no problem. And make a profit as well."

But as more and more couldn't afford it, more and more homes were being offered for sale on the market. Home prices dropped. Many found themselves now owing more than the home was worth. And so they'd "walk away" from the home and have it foreclosed on. Which added even more homes to the market at even more reduced prices. And on and on.

The guarantors and insurers were now being called on more and more by the lending institutions to now back these loans, and as the call for restitution increased the guarantors and insurers found they could not meet the liabilities of all these guarantees flooding in. And so they began to fail. Which made these loans lose even more value.

And so those who invested in these supposedly safe bundled-mortgage vehicles found they were quickly losing value. They began to dump them as fast as possible before they became totally worthless.

Meanwhile new housing and the sale of existing housing tanked because of the oversupply. Other industries reliant on housing slowed down, and began laying off. Industries like plumbing, electrical, construction materials. As their profits dropped, so did the value of their stocks, which caused a massive financial contraction in the stock market. Those initial contractions brought about institutional comp-trade sell-offs, which then caused more sell-offs by individuals trying to salvage what they could before they lost everything.

As these businesses slowed down, their vendors and suppliers slowed down. Fewer workers needed to service their accounts. Fewer salesmen to sell their wares. And on and on... Fewer waitresses needed in restaurants near the now-closed offices and factories, the ones that weren't forced out of business completely.

And those unemployed salesmen, computer-operators and waitresses now bought fewer new clothes. Didn't trade in the car for a new one every other year like they once did. They made that washer and lawnmower last a lot longer. Those that still had jobs and money began to hang on to it a little closer. Spend only when truly necessary.

Bush and Obama bailouts and stimuli (and the resultant Fed actions of more bond sales and money printing) compounded the economic problems with more debt and inflation (especially food and fuel. Lower "official" inflation-rates were only because of the offset from massive negative drops in the cost of housing).

Of course there's a lot more minutiae that can be gotten into, but the bottom-line is that like a gigantic row of dominoes the entire economy collapsed because of government interventionism (specifically and initially into the lending and housing market).

It was pushed by lots of politicians. Maybe pushed harder by Democrats, but Republicans jumped on the bandwagon as well, and at the very least did little or nothing to prevent it. (Although even George W. ( RINO that he was) vaguely warned about it as early as 2001 and a number of times after during his administration, he never really did anything to change anything.

In any case, a little research would easily show this is the reason the US now has a financial crisis. What kicked it off, and how it got to that place to begin with.

But then some people prefer to never let "inconvenient truths" get in the way of what they profess.

You describe the history of the housing bubble very well. But, you never
reach the origins, the underlying cause, which was the lacking oversight
of financial markets and the banking system. As I described to you earlier, Ronald Reagan, then candidate for office, had a plan with which the Federal agencies that would inhibit the "conservative agenda" could be
rendered ineffective or destroyed. Actually, RR didn't develop the plan, of course, as his employer and benefactor, Walter Annenberg, had paid a Los Angeles law firm for years to rewrite the Federal Tax Code and the banking regulations so as to enable the "agenda" to go forward. All they needed was a believable spokesperson to sell the disguised "agenda" to
an unsuspecting public. RR was the perfect choice and had been a loyal
spokesman for years, employed by Annenberg and his friends and paid
for his daily radio broadcasts and speaking schedule.

The housing industry run-up came along after the stock market run-up and
the unsuspecting had been convinced that the "Greater Fool" theory of prosperity was actually working for them. Since the housing and construction industry is the largest segment of employment in the nation, stimulating it is a sure way to spreading "prosperity" to everyone, as GWB
repeated over and over how great things were becoming.

Shortly after RR was elected I was invited to join a small group in the home of Leland Stanford, at the campus, to hear the Cabinet Secretaries describe how the forthcoming "deregulation" of the banking industry and the revised tax code would work to produce a new era of financial and economic prosperity, called "Reaganomics". Banks would be allowed to deal in "equities", to create them, buy and sell, profit from investing their depositor's monies in them, and join the stock brokerage industry. They
acknowledged that these same permissions had caused the collapse of the world economies in 1929-33, but that was just said with a wink and a smile. The Executive Office would control the "agencies", and all the assets and investments of our economy would be channelled to Wall Streets' brokerage, where a few very skilled managers would invest it in the "new and world order of economies, the emerging nations". These
Wall Street houses would, then, "trickle down" the vast profits to be had
sharing with all the banks and "investors". Everyone would become so happy as their "Greater Fool" gains would appear as real prosperity, and
an increasing supply of money would be made available to stimulate the consumer economy. Wasn't that a nice plan?

That senseless deception is and was the root cause of all the economic problems we face today. Just as in the 1929-33 debacle, Wall Street and the Reagan Banks kept and divided the actual profits and sold to their clients and investors the inflated and "derivatives" and "asset backed securities" that were noting but worthless I.O.U's. All the Federal agencies and every knowing economist and observer knew of this ponzi scheme, but it was kept rolling and worked for nearly 40 years, destined
to eventually collapse, but kept afloat by Congress and the Executive Office.

That is the "rest of the story", as a famous broadcaster once said. That is
the part that needs to be understood before trying to blame the present Administration for the results of 40 years of deceit and planed robbery of the assets of America's middle class by a skillful band of thieves.

Just a footnote: Walter Annenberg sold his "T.V. Guide" to a Wall Street
hedge fund immediately after the tax code revisions were passed, for a
bit over $3 Billion, negotiated a tax deferral deal with the IRS, and invested
in "equities". The Annenberg Foundation and his family trusts have about
eight to ten times that amount of money now. Was it worth all the effort?
Well, yes, I would say so.

Please don't mistake me for one who worships at the alter of Ronald Reagan. While I think he was a little better than most presidents, I agree with you that he kissed banking-ass (or at least his appointees) in many ways. (In addition to ways you mentioned, he also pushed for allowing major interest-rate changes on a national level. (Prior to this most states set their own maximum rates that could be charged, which were much lower than after the change.) To make it more acceptable to the Democrats (and Republican spenders as well) the interest deduction for most loans (including credit-cards, auto-loans, etc) was no longer allowed when filing personal Federal Income Tax.

To a large degree this gets back to my main point (as well as my general belief) that government interventionism (especially Federal) creates most of the financial problems and abuses we suffer. Regs that are passed are often used more as a protection for an abusive business than an actual regulation.

More effective regulations, when needed, could be passed by state governments or more localized governments. (ei. larger urban county governments, etc) Abuses by banks and other lenders could also be more effectively solved in the court system (state and local). State legislators are much more answerable to their constituents than are Federal legislators. Their financial records are also more transparent. Much easier to see and document who has "bought" who.

The more power that is consolidated and the higher that level of consolidation, the easier it is to sell that power to the highest bidder. Both sides of the aisle suck from the teat of the banking and investment interests. I blame Democrats slightly more (only insofar as they generally favor more interventionism in all things at the Federal level), but Republicans share plenty of blame as well.

Anecdotal evidence doesn't prove a lot many times, but here are a couple of things that point to the concept that "smaller is better" can work. (Especially if it had remained such, or if there was a major swing in that direction.)

Not long ago I personally sued Chase Bank in my local small-claims court. And won. This was shortly after they had offered ultra-cheap transferred consolidation-loans (I took $10,000 at 1.9%) to customers on the condition of no late payments, etc. Almost immediately after (as the financial world began to change quickly) they did their best to try to call in those loans and by whatever means necessary shaft the customer.

I made my payment in person near the end of the day on the day it was due. It posted to my account the next day. (A day late.) The rate-change would have been well over two thousand a year. Phone calls did no good. (All I got were offers to refinance at a slightly lower rate than the "penalty rate" of 24.9%.)

In any case, I filed in local small-claims court for $1500 in damages. I knew I could prove it was impossible that I'd made the payment at 9am the day it posted and therefore must have been at least a day earlier if necessary, and also I counted on that they would just totally ignore the whole thing anyway and either toss it or consider it a joke. I also filed jointly against the local branch and named the manager as their agent. No one representing them even showed up and I won by default.

When I went in later and asked to speak to the manager he thought the whole thing was funny, until I showed him the judgement paperwork, gave him his copy and told him the next day, as required by law he'd receive a certified copy in the mail and later that day I'd be back with a court officer to get either my $1500 or $1500 worth of his office equipment. It only took a five minute phone call to get my rate back down to 1.9%.

Second anecdote. During the initial "crash/crisis/bailout/etc" on TV was an interview with the president of a small local bank. The interviewer wanted to know his "secret" as to how his bank was still extremely profitable while so many others were failing, etc, etc.

He said "It's no secret really. I just didn't play their game. I didn't want to expand so I didn't have to kiss up to the Feds. I just did the same thing my father and grandfather did. If a man wanted a mortgage or to buy a new car, he had to have a secure job, a good credit history and 10% down. Simple as that. I didn't want to sell my mortgages to somebody and then re-invest the money somewhere else. Those mortgages and loans ARE my investments. I'm not some Wall Street wheeler-dealer. I made sound loans, and so they're sound investments."

Basically what I'm trying to say is that things can be handled at a lower level, which is where they'd still be if it never was allowed to get out of hand to start with. If the bankers and brokers never had the ability to buy favor and power because that kind of favor and power was never consolidated (and thus able to be bought) in the first place.

If the Federal government had stuck to simpler things, like strict enforcement of Sherman laws, not allowing the veils between banking, investment and holding to be pierced, etc, etc. we'd all be better off. There'd be more local Smith's Banks around and not as many "too big to fail" Bank of Americas and Nationwides.

The bigger the level of government, the greater the potential for abuse, corruption and power-brokering.

So you don't need to convince me at all that politicians bought and sold favors to banking and investment special interest groups. I agree with you. I just believe that where there is very little consolidated power, there's very little power to be sold to the highest bidder.

It's difficult to refute your "small world" ideas as the playground no longer exists. We could all write a book of "If only....", and "What if..."
that would solve all the problems we face. There are among us, millions
who are dreaming of returning to 1776 and solving our problems with the
essays that Mason, Madison, Jefferson, and others of that era wrote. I've read most all of those essays and appreciate their passion for their
times. But, the 21st Century is like nothing ever before, as is the start of every century of history.

The nations of the world that are now prospering an growing, some at astounding rates, are those nations that have strong centralized governments with authoritative and controlling planners that are charged
with execution of plans that best benefit the goals of the nation. India,
China, South Korea, Vietnam, Brazil, Germany, Russia, to name the
most visible. Now, not one of these is a nation divided by bickering,
none are seeking to return to their "roots" or past centuries, none are
dividing themselves into 50 competing camps as an experiment in chaos. They are winning the game, building fantastic modern cities,
infrastructures that expansions requires, planning for tomorrow and
the next decade, not cowering in dreams of the past and warring among themselves over ideologies and essays of their ancestors. They
are the future of the planet, and we are paddling our boats upstream against a strong current, eventually to give up and surrender to our
destiny, once great, now a backwater of unmanageable dissension.
Just compare the new cities and developments of these nations to the crumbling and devaying cities of America, and it becomes undeniable that we are being relegated to an unaccustomed status, while we bicker and debate whether "God" is in control of our destiny, and if a
woman should bear an unwanted child, and other such nonsense.

These emerging and dominating economies also have another visible
advantage over us, which is the U.S. Tax Code that allows all the
profits from investing the assets of our citizen's retirement funds, mutual funds, 401ks, etc., and the personal fortunes of the very wealthy, to remain free of U.S. income tax for so long as the gains are not brought back to the U.S. So, the "Regan Banks", corporations,
and those wealthy enough to participate in this with large money, can
accumulate vast pools of assets that must be recycled into these foreign economies and not returned to the U.S.. Of course, the gains are not allowed to "trickle down" to our middle class or the depositors,
as was promised by "Reaganomics", but are kept by those who play the game as insiders. Isn't that just the perfect means of financing
these emerging economies and encouraging the movement of all our
industries and jobs to those places? We get what we voted for, what
we allow our elected to do, and swim in our own pool of ignorance.

I had an experience similar to yours with Chas Bank's credit cards. I
accepted an "offer" of a store to get a 10% bonus discount on a large purchase if I signed up for their credit card. Did so, and mailed my check in full a week before the amount was due. It was addressed to a
Pob in a town of 400 residents far up in South Dakota. Later, I found it was sent from there to a Houston, Tx, lock box, and forwarded on to a center in Miami, FL where it was "posted". It was posted to my account on the 10th day or so after mailing and I was billed for
a large "late fee" and "interest", etc, which I refused to pay. After more
than a year, the fees and charges were well over $200 and growing. I
noted that Elliott Spitzer, then Attorney General of New York, had just
sent several CB executives to jail for similar frauds. I wrote to the U.S. Comptroller General's office in Austin, Tx., and they responded within a
day or two, asking CB for all details of my account. Within a week the
matter was gone, my credit was cleared of all traces of their activities.

In this time, with the technology available to interconnect activities from the most remote spots in the world, those who would conspire to take advantage of the vulnerable and weak, can do so readily. It is not possible that 50 diverse and sometimes gridlocked legislatures could possibly control the ravages of these sociopaths. If they could do so, and would do so, hundreds of problems that we face would not exist.
The weakest enemy is the one divided into factions that disagree among themselves and refuse to join in united actions. That is exactly
why central governments exist, why cave clans joined together to form
towns, and why we have a Pentagon to coordinate the actions of the several branches of our military. Wishing for more or greater divisions, as oppose to making a stronger and more effective central authority, is
a dream that is not going to happen, and if it did it would just hasten the disaster we make for ourselves with distention and bickering.

Thanks for your interesting comments. Even if I can't agree, I do respect our views and presentation.