Lois & Clark Forums Forums General Discussion Off Topic Possible reason for Wall Street crisis

The global economy seems to be on a downturn, and we must all hope we aren't in for a nosedive.

Yesterday, Barack Obama and John McCain gave their views on the present situation. Obama blamed the deregulations of the banking and loan sector carried out by the GOP, and McCain blamed general greed.

A much more pointed analysis comes from Scott Lilly, a left-wing person whose qualifications you can read about here . According to Lilly, the root cause of the present crisis is that the American economy is primarily consumer-driven and heavily dependent on domestic demand. But during the new millennium, Lilly argues, the middle-income American family has become poorer. The reason for this is that President Bush has been redistributing the flow of money in America, diverting it from the low- and middle-income people and sending it along to the rich.

And since most Americans have become poorer, it follows that most Americans have become less able to buy goods and property. Yet the supply sector needs the American people to buy the goods it produces. The supply-side solution has been to encourage low-income people to take risky loans to be able to keep up their spending.

Here are some of the things that Lilly says:

Lilly supports his claims in a report full of facts and graphs that I myself found most impressive.

Ann

Thanks for the info and the links.

alcyone

Hmm... just from reading that snippet, it seems that this guy has a bias against Bush to start with - and the 'left wing' thing seems to indicate the same thing. Does that automatically disqualify what he has to say? Of course not, but it could easily color his research - not the research itself or the conclusion he reaches, but rather WHEN he researches. Does he look at the 90's as well to see if there's anything there that could have helped lead to all this? And it was only in the last couple years that there were no Clinton appointees on the Fed Res Board and all this started long before that.

For instance - even if you desire to stay out of the Palin thread - Roger posted about this very thing here . I don't know his sources, I'm sure he could tell you, but it's in line with other things I've heard elsewhere [but not online and no time right now to find online sources].

One of the other things that jumps out at me... sure, credit was [and still is] easy to get. I know mortgages are more difficult, but I get more credit card offers than I can use all winter for kindling [and that's about all they're good for]. Does that mean that there's no personal responsibility? Shouldn't people have been smart enough not to spend beyond their means? We could have gotten a mortgage for significantly more than we did but we knew we couldn't afford it and went with a fixed rate on the mortgage we did get because when rates are at historical or near historical lows do you really think they're going to go down? Do I really need to point out the mathematical stupidity of an interest only mortgage? One that will, by definition, NEVER go away. Do I want people to end up bankrupt or in foreclosure? Of course not, but at some point it's not MY responsibility [as a taxpayer] to help bail them out because they made bad choices and got in over their heads.

Should the govt have bailed out Fannie/Freddie/AIG? Heck if I know, but they shouldn't have been in the mess in the first place if government had been doing its job to start with.

Just my .02.
Carol

Well, since I'm a left-wing person myself, what Lilly says makes sense to me. Also I think that his data seems sound. Clearly, though, I'm not unbiased here. And I'm not saying that people should not be responsible for their own choices.

As for the Palin thread, yes, I have decided to stay out of it. I could inject a lot of emotion, but no useful information. No one benefits from that. But it has been informative and interesting to read what the rest of you have said.

Ann

A cursory reading of his document show a number of holes where he does not dig deeply into the cause of the numbers he is showing. He also uses a number of statistical fallacies that make his argument look good but don't work when other statistics are used.

Just off the top of my head here are a few of the holes I see:

First he compares today's economy to the Great Depression. That is a typical scare tactic to make people think the economy is a disaster. The economy is far from the Great Depression. First of all, in a truly bad economy, most companies are losing money. Right now, losses are concentrated in the transportation industry, for obvious reasons, and the financials, again for obvious reasons. The rest of the companies are doing reasonably well with individual variations of course. The company I work for, for instance, is a high tech communications company that is making money like gangbusters and is hiring rapidly. Many high tech companies are still making lots of money where typically they are the first to go down as high tech is usually purchased with extra discretionary income.

The conditions under the Great Depression saw 25-30% unemployment while today we sit at 6.1%, a historical low. Just to compare the misery of the Carter era, unemployment stood over 10% while inflation was at 21%. Today inflation is at 5.4%, most of it due to oil. And that is cooling off with oil in free fall. We are still not even in a recession by economist definitions, which require two consecutive quarters of negative economic growth. This quarter is expected to show a small growth while last quarter showed a very tiny drop of less than 1%, annualized. So right off the bat, his comparisons are all wrong.

In his first paragraph about the Bush economic team, he uses another fallacy. He compares the average tax cut of the top 1% of $83,000 to those of those making $51,600. What he doesn't compare is the average percentage of tax cut rather than a raw number. For instance, a person making $1 million a year who gets a 1% tax cut would get $10,000 back while someone making $50,000 who gets a 10% tax cut would get back $5,000. Which tax cut is more effective? $5,000 is worth a whole lot more to the person making $50,000 than $10,000 to the millionaire.

I also question his numbers of less than $1,000 for families making $51,600. Numbers that I had seen earlier showed that number to be closer to $2,500 for families in that income category. I haven't got the time to look it up further.

The argument on the minimum wage is also debatable. A rising minimum wage reduces jobs, so it's questionable whether a higher minimum wage even leads to higher overall wages. While people making minimum wage forever would suffer a loss in real income, people do not stay at minimum wage forever. So those same people five years later are usually not in the same income category. Here is an article by Arthur Laffer I read a couple days ago showing a large degree of income mobility, which disputes the contention that people are losing money.


New Evidence on Taxes and Income

The graph I saw on falling numbers of manufacturing jobs is also misleading. Manufacturing jobs are falling IN ALL INDUSTRIALIZED NATIONS, INCLUDING CHINA. As manufacturing modernizes, this is a natural process.

On stagnating incomes, he does no analysis on why incomes have stagnated. He doesn't even include the negative impact of the dot com bust that coincidentally happened in 2000, the beginning of his statistical comparison. I'd like to see what his comparisons are for 2000-2001, 2001-2002, and so on. By completing ignoring the disappearance of 60% of the NASDAQ and the disappearance of trillions of dollars beginning in 2000 and counting that as simply bad Bush economic policy is misleading at best.

The argument that not enough jobs were made is also fallacious. Over five million jobs were created during the Bush Administration with unemployment falling as far as 5.1%, only to begin rising with the bursting of the housing bubble. If the workforce is growing faster than the number of jobs, unemployment would never have fallen to 5.1%. So that's wrong. Unemployment rises when the workforce rises without a comparable rise in jobs. Just as an example, the latest increase to 6.1 from 5.7% was mostly attributed to a rising workforce of 500,000.

I love the fact that all of his comparisons start with 2000, the height of the dot com boom and the bursting of the bubble. Considering trillions of dollars of income vanished that year meant that there was a huge hole for Americans to climb out of before Bush ever took office, which his statistics don't account for.

That was no small event. Consider that the NASDAQ stood at 5132.52 at its all-time high on March 10, 2000. One year later, the NASDAQ was at 2052.78, less than two months after Bush took office and while the economy was still operating under Clinton economic policies.

Worse of the worst, he does a very superficial analysis on why the real estate bubble was created and why it burst, automatically attributing it to Bush policies, when in fact the largest footprints in the mortgage industry, Fannie Mae and Freddie Mac, were controlled by Democrats, who severely mismanaged those companies, directly causing the current financial crisis. When the president attempted to address the problems before they became a crisis, Democrats stood in the way of reform. Just wait until the twin pending catastrophes of Social Security and Medicare when they begin to fail in just nine years. I might post something about the myth of the Social Security Trust Fund and the swindle those programs represent. Again, the president tried to reform those, only to be stopped by Democrats.

This is true of anything, especially in this polarized season. The fact that this person is from the left should make one cautious, just as anything Roger posts should make one cautious, even if he is not as careful as Ann in linking sources and stating his position or the credentials that back his view. It's clear enough where he stands and what his skew is.

Except of course, there are charts and numbers involved here, which is always extra informative. I rather that than cushy narratives, which tell me more about the person making them than what is actually there. I'm sure places like NRO, etc have their own charts. But their research is just as skewed as this person's towards the Bush administration, if you want to consider methodology.

The economy is a large and unwieldy organism and there are any number of theories for the state we're in. The ideologues would have us believe that they hold the final answer like some unheeded prophets, but the truth is that no, it's not that everyone that disagrees with you is a moron, but rather that people have legitimate concerns with your line of reasoning.

Ultimately it's a matter of where one stands, but that doesn't mean that more information on a diverse set of views is not enriching.

alcyone

If anyone wants another viewpoint, my opinion is that the huge shift of most Western economies from production to financial services is the main cause. In a production-based economy a bank failure is going to inconvenience a lot of people, but relatively few will actually lose everything. In an economy where the main revenue stream comes from financial services a bank failure is going to have hugely disproportionate effects. It really is that simple, though I doubt that economists will necessarily agree.

I'm skewed!?!? And I always thought I was perpendicular.

If links are what you want, here's one to an Investors Business Daily editorial:

The Real Culprits of This Meltdown

Here's a link to the New York Times showing the Bush Administration's attempt in 2003 to regulate Fannie Mae and Freddie Mac, which Democrats stopped cold.

New Agency Proposed to Oversee Freddie Mac and Fannie Mae

Here's another one:

Financial Markets are in a Mess

Here's the direct quote Robert B. Reich, Clinton's Labor Secretary, made on MSNBC, the network no one watches:

Conventional wisdom, even inaccurately mentioned on the Fox News Channel, which is allegedly in the tank for Republicans, says that McCain is universally for deregulation and would not have supported regulating Fannie Mae. This is inaccurate as McCain sponsored the Federal Housing Enterprise Regulatory Reform Act of 2005. Here is a quote from McCain on the floor of the Senate in 2005 as he predicted disaster ahead:

FEDERAL HOUSING ENTERPRISE REGULATORY REFORM ACT OF 2005

Obama opposed the bill, in lockstep with Democrats whom he votes with 97% of the time. Anyone still voting for the guy (Obama) who's taking economic advice from the people who caused this problem and couldn't support a fix for the problem when he had the chance to do so? What's he going to change that isn't just going to recreate this financial mess later?

Yay links. *nabs*

alcyone

Roger, you make several valid objections to Scott Lilly's claims, but I think you have really misunderstood Lilly's arguments when you say this:

You are talking about how today's situation compares with the situation during the Great Depression. However, one of Lilly's main points is that today's situation is very reminiscent of the situation just before the Great Depression. The big similarities between then (circa 1920-1928) and now (2000-2008) is that minimum wages were low, money was channeled from the poor to the rich in that worker productivity rose sharply (during 1920-29 by 63%, during 2000-2007 by circa 20%) while inflation-adjusted wages fell (during 1920-1929 by 9%, during 2000-2006 by circa 2%), and the general public became poor enough not to be able to purchase all the goods and products that the supply side was producing. That, according to Lilly, was a major reason for the Wall Street crash of 1929 and the following Great Depression. And while worker productivity has not risen so sharply or wages fallen by so much during the current decade as during the 1920s, this means that there are similarities in the development of the American economy in the decade before the Great Depression and the decade we exist in now.

A few claims by Lilly: During 1994-2000 inflation-adjusted income for middle-income families rose by 14%, while during 2000-2006, the last year for which data is available, inflation-adjusted income for middle-income families fell by 2%. Another interesting figure is that in 2006, the top ten percent of American households accounted for 49.32% of all household income in 2006. This is the highest figure ever. In 1928, right before the Wall Street crash of 1929, the top ten percent of American households earned 49.28% of all household income. In 1996 they accounted for 43% of all household income in the United States, and in 1976 they earned 33% of all household income. If Lilly is even remotely right, the richest people in America have indeed become proportionally richer than other Americans, while the middle-income Americans have become poorer during the Bush years, although they became significantly richer during the Clinton years. (You are right that Lilly does not discuss the Clinton-era IT bubble at all.)

My point is that it is not correct to claim that Lilly compares today's situation with the state of the American economy when the 1930s depression was well underway.

Ann

Well... it isn't just America that's been affected.

You should see how much has carved off one of our Australian share portfolios in the last week... it's depressing!

Thank god we have our investments diversified.

I imagine there are a lot of people out there who rely on their shares to keep them afloat that are going to have a rough time ahead....

I have a very serious objection to something that was said in the Investors Business Daily editorial that you gave us a link to:

Tough new regulations forced lenders into high-risk areas? Who forced them?

In my first post, I said that low-income people were encouraged to take risky loans. Carol pointed out that even if people are encouraged to do stupid things, they are ultimately responsible for their own actions. I agreed, at least partly, because I do think that people can be tricked into doing irresponsible things in situations they do not fully understand.

But the Investors Business Daily editorial claims that lenders had no choice but to do very risky things? They were forced to? Even though it was their job to assess risk and to know that these things were unsafe and potentially unethical? Who forced them to do this?

Scott Lilly's main point is that the global economy suffers because rich people have made themselves richer at other people's expense. The Investors Business Daily's main point is, as far as I can see, that lenders have to make themselves as rich as possible, even at the risk of creating long-term problems or crises. If governments try to regulate these people's behaviour then it is those governments' faults that these people were forced to put themselves and large numbers of other people at risk so that they could keep enriching themselves until things fell down around them.

I'm not impressed.

Ann

The point in question the IBD editorial was making was that the Clinton Administration was penalizing companies that did not lend money to minority and low-income families under the Community Reinvestment Act. Basically, the government was considering it discrimination if the lenders did not lend. So fearful of facing financial penalties, the banks loosened up their lending standards so that they essentially lent to anyone who could "stand up straight" as Robert B. Reich put it.

Whenever government distorts the free market, there is a real danger of economic bubbles forming. Just like the real estate bubble in 1990, that was government induced due to tax loopholes that encouraged bad investments in commercial real estate. When those loopholes were removed, that bubble burst.

The government was not responsible for the dot com bubble. That was mostly due to the "irrational exuberance" people had, feeling we were in a "new economy" where earnings and revenue didn't matter. Eventually the lack of revenue by any of these dot com companies caught up to them, causing them to die. Even companies with large revenue streams were caught in the fallout. The company I worked for, for example, lost 2/3 of its stock value despite record profits each quarter and has only recovered about half of its lost value over these eight years since the collapse of the NASDAQ.

Ann - Again, I don't have sources handy, but I think Roger mentioned it in his Palin post. Lenders were mandated by the Feds [mainly Congress] to allow low income/high risk folks get loans by increasing penalties for not giving loans to low income people because it was prejudice against those with low income [incomeism?]. From a purely economic standpoint, it would be bad business for a bank to give us a loan for a 125K house [on the pretty nice side of average around here] when we only made 20-30K, but as I understand it they were required to.

Around here, 400-500K will get you a REALLY nice house and/or a lot of land. In coastal areas and other big cities, it'll get you a two bedroom with a small concrete backyard [or something like that based on the flip shows]. There's no way that the average family can afford those unless lenders are required to loan the money. The general guideline is no more than 33%ish of your income for the mortgage payment [25% preferable but other things will be taken into account - down payment [equity], other debt, etc]. When the only way to get it to something resembling those ratios is to do the 'creative financing' stuff - interest only for a few years [what happens when you have to start paying interest? Payment triples? Screwed.] or adjustable rates [we can squeak by now but if it goes up we're screwed and when it goes up you see foreclosures go through the roof] or balloons [low payments now and in 5 years [or whatever] the balance is due and if your income or credit score has taken a dive since then, you're screwed]. So banks had to get creative to avoid penalties from the Fed Govt for 'incomeism' and people bought things they absolutely could not afford because someone was willing to give it to them. There's blame on both sides.

We coordinate a financial class put out by Dave Ramsey [who was mentioned in LtL if that rings any bells]. He told a story in tonight's video:

A couple came in for financial counseling. They brought home $1200 a month. Their car payment was $600. God had given them the car, even the finance manager said it was a miracle.

Yes, they should have been smart enough to not buy the car, but the finance manager/whoever should have said 'No, you can't afford this. Here's a nice car with a $125 payment [or whatever]'.

In the case of Fannie/Freddie, if they were running finance manager's office, they would be fined for not giving them the 'opportunity' to finance this nice car even though they can't afford it.

Is there plenty of blame to go around? Heck yeah.

Individuals are conned sometimes, but they also get blinded by 'I can own a home'itis and don't sit down and look at what they can really afford and then buy only that.

Banks/mortgage cos/whatever you call them giving loans to people they know won't be able to afford them and not checking claims [there are loans where you only have to tell them how much you make and they don't actually check it - or they would, probably not anymore] and boosting numbers to make their bosses look good and get bonuses [see: Fannie/Freddy and the millions their execs took in bonuses - very Enronish but since it's federally run, sort of, no one has/is questioning them, subpeoning them, trying them for falsifying records etc].

Government for not overseeing like they should have. SEC, Dept of Housing, assorted committees in Congress for not taking harder looks at it. McCain did call for just such regulations etc in 2005 [Roger linked to that] but it was blocked by Dems [Bush had said something along the same lines as well].

Anyway - how were they forced? By being threatened with huge fines/etc for not giving loans to low income folks.

Carol

ETA: Yeah what Roger said .

I would agree with this. I found these articles measured and informative, if left-leaning:

Fannie Mae and the Vast Bipartisan Conspiracy

Both Obama and McCain have Ties to Loan Giants

All the Marbles

And I saw a link to Fox, so I feel less guilty about linking to the Times:
In Candidates Two Approaches to Wall Street

My take is that opportunity creates greed, which is why regulations are needed--everyone is going to try to work the system. While it's commendable McCain had the foresight to try to regulate FM in 2005, and has experience with FDA tobacco regulations and strengthening requirements after the Eron thing (Sarbanes-Oxley Act), the Washington Post reported that as recent as 2007 he was back into orthodoxy voicing his regret on his vote on the Sarbanes-Oxley. McCain's recent experience as far as I've read seems to lie in telecommunications sectors, where he was--no surprise here-- against regulation.

*shrug* I can see why if you were against government intervention you'd want to err on the side of big companies, but I do not agree.

So, naturally, I'll take my chances with Obama and his curious economic adviser .

alcyone

Interesting. I didn't know that. Thanks for telling me.

However, it seems to me that there would be no way for the Clinton administration or any other administration to force lending institutions to offer loans at such low rates that the lending institutions themselves were sure to make a loss. That would be sheer economic madness, and if Clinton had proposed it, then Congress should have opposed it. Remember that Congress was dominated by Republicans during Clinton's second term. Sure, Clinton could have issued a veto to strike down the objections of Congress, but just think how bad it would have looked to posterity if Clinton had gone on record saying that lending institutions must give loans to low-income people at rates that are below inflation. He can't have done that, because if he had conservative media would remind us of it every chance they got.

So Clinton didn't force lending institutions to offer loans to poor people at rates that are below inflation. In other words, lending institutions were still allowed to make a profit when giving loans to low-income people. However, the way I understand the subprime loans, they generally mean that the person taking the loan has to pay a very low interest rate during the first few years, but then the interest rates shoot up sharply. That means that low-income people may be able to pay their interest rates during the first few years, but when the rate goes up they will be forced to default on their loans.

Surely lending institutions weren't forced to ask for a very low interest rate during the first few years and then a much higher rate after that? Surely they could have asked for a fixed rate from the beginning? That way low-income people would have seen right from the beginning that they wouldn't be able to afford that loan. And I don't see how the lending institutions could have been fined for making low-income people realize the true cost of taking a loan.

Anyway, remember that according to Scott Lilly, inflation-adjusted earnings for middle-income people rose by 14% between 1994 and 2000. During that time, people might reasonably expect their incomes to rise, so that they would be better able to afford a loan. But during the Bush years, middle-income earnings have fallen by 2%, according to Scott Lilly. Lilly also claims that the less you earned when Bush was inaugurated, the more your economic situation has probably deteriorated during the Bush years. And since it was Bush who was primarily responsible for shifting the flow of money away from low- and middle-income people into the pockets of the rich - mainly by way of his huge tax cuts for the rich - you might argue that Bush, more than Clinton, should have realized that subprime loans were becoming a real problem for poor people.

So I still very much question the claim that lending institutions were "forced" by the Clinton administration to offer hugely risky credit to poor people.

Ann

The banks weren't taking losses on loans that were performing, i.e. people were actually making their payments. The losses the financial industry is suffering now is on defaulted property. Government is also exacerbating the situation even further due to their drastic over-response to the Enron situation. Sarbanes-Oxley, an extremely poorly written law with byzantine and unnecessary requirements, was only one part of the government overreaction. The FASB (Financial Accounting Standards Board) controls how accounting operates within the country. When Enron happened, FASB changed the rules of accounting so that property had to be discounted to its lowest value, in many cases zero, when payments for loans were not being made, essentially a worst-case scenario.

Since we all know that real estate cannot be worth zero, the new accounting rules, meant to offset Enron's over-inflation of asset values, went too far in the other direction. In the cases of Lehman, Merrill Lynch, AIG, etc., these companies even warned that the write downs on their real estate were not real losses as many of those properties were written down to zero as FASB required. Yet because of the new rules, their balance sheets of those companies became total disasters, destroying their credit and hence putting them into the boat they're in.

Now how do banks make money with loans? They take deposits which people place into their bank accounts (known as demand deposits) and they make loans on them to other people. Deposits are considered liabilities on a bank's balance sheet while loans are considered assets. As long as the loans are worth more than the deposits in terms of cash flow, then the bank makes money. Note that most checking accounts actually pay zero interest while even savings accounts offer negligible interest rates, clearly giving banks access to money that is depreciating. In a nutshell, banks make money using other people's money, not their own.

You underestimate what people will do to get a loan to buy a house. People have a tendency to push negative news to a later time and will sign onto the many creative financing methods in order to afford what they really can't afford. So while the current loans were affordable, the slightest rise in interest rates would cause many of them to default. Not everyone is versed in economics. People have a tendency to believe that current circumstances can last forever. So the possibility of rising interest rates wasn't enough to deter them. The lure of home ownership, pushed so hard by the Clinton Administration, caused many of these people to sign up for loans they shouldn't have been carrying. If they could afford it, they would not have defaulted and the financial industry would not be in the shape it's in right now.

Owning a house is considered part of the American dream along with the 2.1 kids, two cars and the white picket fence. People will go through quite a bit to obtain that dream, including stretching themselves thin.

I should also bring up that many of these banks did not actually originate the mortgages in question. For instance, AIG carried $600 million in bad Fannie Mae mortgages. Banks buy mortgages through swaps in order to offset the short-term nature of demand deposits and the long-term nature of mortgages. The reasons for swaps are because short-term deposits and long-term mortgages have different risk levels, so banks attempt to balance risks. It's a fairly complex topic that I'll admit I don't fully understand despite having learned a bit about them when I had a securities license with the NASD. Believe it or not, I started my career as a securities broker before becoming a software engineer years later.

As for banks fearing the federal government, just saying the word, "audit," will bring panicked expressions on people's faces. The government has a lot of power, too much power, to impose its will on the markets. The threat of fines if they turned down a low-income or minority borrower is a powerful incentive for them to make those loans. They take the risk, knowing that it could come back to haunt them, but it's better than facing the certainty of fines.

I also disagree with your assumption that money was transferred to the wealthy through tax cuts. Tax cuts, by percentage, went to the lower income brackets so that the burden on the wealthiest actually rose with the tax cuts, becoming even MORE progressive. I'd think you'd be all for that. When I have the time, I may look up the statistics, but you'd be staggered to see what the tax burden is on the wealthy. One figure I remember is that the lower 50% of all wage earners pay 3.6% of the total federal income tax while owning roughly 25% of the income. As with the examples I used in the earlier post, using raw dollar figures doesn't paint an accurate picture since it's really percentages that matter when you determine who benefitted most from tax cuts.

It's also impossible to transfer money from one group to another through tax cuts, only through transfer payments, i.e. welfare. When everyone gets a tax cut, everyone's taxes go down so there can be no transfer involved.

I do have to say Obama supports using the tax code to propagate welfare since he advocates giving tax cuts to people who don't pay taxes. His proposed middle tax cuts are a myth. In reality they are transfer payments disguised as tax cuts.

Why don't you check out page nine in Lilly's report? There is an impressive graph there, claiming that fewer than 15,000 American families got one quarter of the nation's personal income growth bewteen 2002 and 2006. That's staggering, if you ask me. Lilly also claims that while the bottom 90% of Americans got a modest raise of $305 between 2002 and 2006, it is almost certain that most or all of that income raise went to the richest of the bottom 90%. If it wasn't the Bush tax cuts that gave the very richest people such stupendous raises, then where did those amazing raises come from? Particularly in view of the fact that the richest Americans got so much richer while middle-income America became poorer.

If you don't understand why the banks made those swaps in spite of having worked as a securities broker, are you sure that those swaps make any good economic sense at all? Haven't they just been a way for banks to increase their nominal assets and short-term profits?

Maybe it was Clinton who forced them to make those swaps? Sorry, couldn't resist. I remember when I got a 25-page rambling document into my hotmail inbox, claiming that it was Clinton's fault that 9/11 happened. Hey, I'm not saying he was perfectly blameless, but... come on. I suppose Clinton caused Russia's intervention into Georgia, too? Okay, I'm not saying he was blameless. And I guess he was the one who caused the assassination of Benazir Bhutto, the massacre at Virginia Tech, the derailment of that train in Los Angeles, and the fury of Katrina and Ike. Wow. I remember the Clinton years as a period of optimism, prosperity and peace. Who'da thunk he would be found guilty of every disaster that has happened to the United States since he himself left office?

I know. That was unnecessarily provocative. But I'm tired of how some people blame Clinton for everything that went wrong in America after his presidency was over, while at the same time they can find no fault with the people who were actually in charge of the country while the problems and disasters happened.

Ann

Well, sorry, again I can't resist. In today's New York Times, Nicholas D. Kristof writes this column about how Richard Fuld, the chief of Lehman Brothers,

in order to turn his company into dust. That amounts to getting paid 17,000 dollars an hour to do the job of obliterating an 158-year-old firm.

I'm sure he richly deserved that salary!

Ann