The Leaders Who Cry Wolf

There has been an ever present strategy in Washington to lead us down a road of fear and despair, if and only if America doesn't respond immediately to any threats that surface. Being wary is alright, but there is a key ingredient missing in the practice of informing people of looming crisis or failure: information. Many government leaders inundate Americans with headline statements that infuse fear and strong emotions in folks that gives leadership a "blank check" on policies that they want implemented.
Now, in today's economy, we've been confronted with statements from the U.S. Treasury secretary, Paulson, President Bush, and leaders of Congress, all having cried that if Congress doesn't make a decision on the housing mortgage bail out, then the U.S. would face a major economic fallout, a depression. What needs to be done is stop this fear mongering, and begin to "connect the dots", so that Americans can understand what this bail out will do to benefit the taxpayer. The fear of terror, the fear of financial crisis, the fear of voting for the wrong candidate, the list goes on, when it comes to unresponsive and irresponsible political leaders. If the current economic crisis is considered, even after instilling the fear of losing jobs, and credit and coming face to face with those elements of financial failure, this "crisis has had little effect on most Americans" (Lesson From a Crisis: When Trust Vanishes, Worry). Throughout history, people fear what they don't understand, and the Economic Stabilization Act, not only disables confidence, but places emphasis on bailing out the rich, simply because the populace doesn't understand how it works.

It would make more sense to publish a brief summary of how this act works online on a government website, maybe citing bits and pieces of the 110 page act, so that Americans can see how it helps them, and will benefit them in the long run. This is an age of information, and what the current administration fails to recognize is that more and more people take it upon themselves to be more informative with a tremendous library of information at their fingertips. There is no excuse anymore for politicians and leaders alike to propagandize on crisis, and force policies upon the public by instilling taciturn fear.

The leadership in government is simply not working, or should it be said that it isn't doing its job collectively. The average taxpayer, even if they could access the Library of Congress' THOMAS, he or she would not have the patience or diligence to sit down and plow through 110 pages of legislative jargon. It's not a document that can be easily digested by the public, and it shouldn't be the only avenue to getting more information about a government plan. It is the responsibility of government to make this information readily and easily available, and should be preceded by any language of dread from leaders who desire swaying the people into brash decision making.

Propaganda is a thing of the past. The information age is enabling individuals to define the truths that exist behind "the interests of those in power", or those simply seeking to persuade the majority. What propaganda does is takes slices of truth, not the whole truth, but part of the truth, and becomes a fog of information, called mystification. So in other words they are truthful lies, but are lies all the same (Propaganda 101: How to Decode Political Ads).

Due to the large amount of readily available information via the Internet, media or libraries, mystification of the general public is attainable, because the true information, the contextual information is difficult to decipher, and filter. So why not make it the responsibility of the U.S. leadership to do the filtering for the public? It should be policy that legislation cannot be voted upon until the taxpayers can supply feedback to policy makers about the legislation, in order to inform leaders that the average citizen comprehends the rudiments of this legislation. Also, legislation should not be voted upon, until a consensus is studied by our leadership of this legislative feedback.

Fear is that which we don't understand. So learn!

Warning! Warning! Warning!

It's a very simple solution that the government and Wall Street fails to put together. The U.S. Treasury expects the American taxpayer to rescue Wall Street at a cost of $2300.00 a taxpayer. This years tax stipend offered up by the Bush administration was a mere $600.00. American homeowners are struggling to pay off their mortgages. All of this, and yet the American people are being asked to rescue Wall Street. The U.S. government has been irresponsible, and Wall Street has been irresponsible, and taxpayers should not have to pay. Several solutions were put in place by the U.S. government, and yet all have failed to help the economy sustain itself. It simply cannot. Everyday in America, Americans are losing more and more money, and while they lose, the U.S. government insists on withdrawing more money from them. The well is dry.
Now back in April of 2008, Fannie Mae and Freddie Mac, were both warned about their accounting practices, having performed the practice of producing "gains when the value of securities declines." Basically these companies were legally cooking the books through accounting standard no. 159, Fair Value Option for Financial Assets and Financial Liabilities. The law set aside, it was not regulated and not used with an ounce of prudence, and had inflated the actual value of Fannie and Freddie's assets. Even the director of the Office of Federal Housing Enterprise Oversight (OFHEO), stated that "it is important that Fannie Mae and Freddie Mac apply fair value in a sound and consistent manner." But no one one was listening. Why not? (Fannie Mae, Freddie Mac get accounting warning)
How much warning does this government need, in order to intervene, before it is too late? Even as far back as July 2007, Bear Stearns, ripped a hole in the the global markets, when Bear Stearns admitted that their $20 billion worth of hedge funds, "were now virtually worthless." At the same time, word started to spread throughout the investment markets, that hedge funds of Lehman Brothers were also in trouble (Market is shaken by warning on sub-prime crisis). In October of 2007, the New York Times reported that Bear Stearns, not only was laying off employees to balance out costs due to flailing asset values, it had "written down the value of some assets by 3.4 billion dollars." With this UBS issued a warning, saying "exposure to the United States credit market 'could lead to further write-downs.'" (More Cuts at Bear Stearns as UBS Issues Warning)
It is sickening to know that with these warnings, and the insight offered up by certain companies, that no one, either in government or in the market, stepped up, and had a plan to salvage our markets, in a time when crisis was as present as it is now. If this article doesn't convince you of how many warnings, this government could have paid attention to, go ahead and search Google, for any of the bailed out company's names, and the keyword "warning". Now Congress is asked to not take its time in resolving the issue of financial crisis, and have just a week to implement a plan for the most critical decision to be made in the history of the U.S. The government and lawmakers had plenty of warning, and either ignored warnings, or rushed to place a band-aid on every financial breakdown that came our way. Basically, the U.S. government is planning to shovel more resources into proven failure. This failure is a vacuum, and produces no return to investors, and the more dollars poured into this vacuum, the more bloated it becomes, and the faster it runs away from those in debt, who are already having trouble keeping pace with the markets.
The consumer, and the average investor cannot continue to be financially beaten down, and at the same time be expected to have confidence in the current market. Like Senator Dodd, stated today, in the banking committee's hearing, "it is simply not a cosmetic issue", anymore. It no longer is a matter of market psychology, but rather a matter of reality. There is a real failure evident, and it needs to be regulated in a manner that will allow the government to oversee the investment practices of large firms on Wall Street, without dollar valued rescue, and only guard the U.S. taxpayer from crisis before it happens, by stepping in, and being prepared to enforce the law against those who intentionally abuse the financial system, for selfish profit.
How much warning did the government need? It was evident as far back as at least one year that these investment companies were not only in financial dire, but that they were intentionally massaging the system, so as to falsely preserve not only their own assets, but create pseudo-confidence in the investment markets.