by: Engineer of Knowledge
It was Albert Einstein who said, “Insanity: doing the same thing over and over again and expecting different results.”
Well I am passing on chronological accounts of the Republican’s mantle of “Government is not the Solution to our Problems; Government is the Problem.”
Ronald Reagan Administration:
Our current banking crisis started with Ronald Reagan when he signed the “Tax Reform Act of 1986” and one of his proudest moments of wiping out some “Government Regulations.”
The deregulation of Savings and Loan Associations (S&Ls) in 1980 gave them many of the capabilities of banks, without the same regulations as banks. Savings and loan associations could choose to be under either a state or a federal charter. Immediately after deregulation of the federally chartered thrifts, state-chartered thrifts rushed to become federally chartered. More important, however, was the moral hazard of insuring already troubled institutions with public dollars. In the view of a savings and loan president or manager, the trend line was fatal over the long haul; thus, to get liquid, the institution had to take on riskier assets, particularly land. When the real estate market crashed, the S&Ls went with it. By insuring the risk, the government guaranteed that desperate S&L owners and managers would engage in ever more risky investments, knowing that if they were successful, the institution would be saved, and if unsuccessful, their depositors would still be bailed out.
The savings and loan crisis of the 1980s and 1990s (commonly dubbed the S&L crisis) was the failure of about 747 out of the 3,234 savings and loan associations in the United States. As of December 31, 1995, The Resolution Trust Corporation (RTC) was a United States Government owned asset management company run by Lewis William Seidman and charged with “Liquidating assets, primarily real estate-related assets such as mortgage loans, that had been assets of the Saving and Loan Associations” (S&Ls) declared insolvent by the Office of Thrift Supervision (OTS) as a consequence of the Savings and Loan crisis of the 1980s. (Does this sound familiar?) The RTC estimated that the total cost to the Middle Class Tax Payers for resolving the 747 failed institutions was $87.9 billion. It was at this time that the citizens cried to have the Bank Laws readdress and reinstituted as they were before they were removed as the “Problem Of Government.” It was not to be done and the problem was just compounded and got worse and repeated once again.
Texas Savings and Loan Real Estate Crash:
With the Deregulations still in place the “Texas Empire Savings” in Texas revealed land flips and other criminal activities. Half of the failed S&L’s were from Texas, which George W. Bush operated one with his brother, pushed that State into recession. I might add that the rest of theUnited States was enjoying some of the best economic booms in recent memory. As bad land investments were auctioned off, real estate prices collapsed, office vacancy rose to 30%, and crude oil prices fell 50%.
After the devastation and raping of the “Texas Savings and Loans,” the ignorant people of Texas elected George W. Bush Governor because he was a “Conservative Born Again Christian.” (When did these words translate into “Thief?”)
The George W. Bush Administration Years:
Still the unabashed “Deregulated Banking Industry” still kept up the pace that eventually led to sloppy bookkeeping, poor investment decisions, and the explosion of sub-prime lending. In the years past before the removal of those “Economic Killing / Anti-Business” laws that were in place before Reagan’s attack on them, would have caused a government crackdown in those earlier years.
But yet once again more regulation practices were removed by the passage of the Sarbanes-Oxley Act 2002 and signed, notably, by George W. Bush!! At the same time, however, this same President invoked an obscure 1863 law forbidding states to regulate local banks to make sure no restrictions could be place on the Banking Industry by States trying to protect themselves from the economic abuses.
(Interesting?!? What about “States Rights” being employed when they don’t like the Federal Laws from the same Conservative Republicans)
Therefore, the George W. Bush Administration has the “DUBIOUS HONOR” of removing the last safeguard regulations that protected the “Middle Class” from the industry and we just saw the worst “Banking Melt Down since the Great Depression.”
Now just like on Que and on Script this 2012 Election Year, we are hearing once again from the Ultra-(Bought and Paid For) Conservative Republicans running for all offices, “That the problem with our economy is all of those Restricting Federal and State Law Regulations that need to be removed because they are Job Killing / Anti-Business!!”
My closing reply to those who have bought into this propaganda crap…… “Start reading at the top of this article once again to see where the problem LIES!!!!!”