The Bailout

I am a student of history. I love history. I am no expert, but I've been fascinated with certain aspects ever since I was eighteen, and I heard Dr. Dobson make the statement that when the Roman Empire embraced immorality as a way of life, it quickly grew weak until it collapsed, and we are heading the same direction. That's a paraphrase, and no Dobson does not influence most of my life, but I found that interesting, because I never really considered the role that a culture's values play in how it prospers.

I've also found it fairly true, even in our own culture. I also remember a history teacher in junior high talking about how their is a typical economic cycle that involves prosperity, depression, war, recovery, and then prosperity again.

Often, when we think of morality, we automatically insert the word "sexual" in front of it. Yet, sexual mores in our country are just part of the sickness that we suffer from. Right now, we suffer from the idea that if we believe something will make us happy, we should have it, now. To put it nobly, we are a culture of pragmatists. To put it far worse, we are a country where a good portion of us have no self-control. We focus on temporary fixes to our discomfort, and we define both discomfort and happiness in a purely immediate way, completely divorced from values, and repercussions.

But one thing I have heard in the last week is very true. A healthy democracy is dependent on the people being good. Capitalism is dependent on businesses being good. Good as in behaving, good as in being ethical, good as being caring for their neighbor.

The measure for our the health of our country's economy is the GDP, or Gross Domestic Product. That means that when consumers believe that the future looks good, they spend money, the GDP goes up. But in a culture that spends on credit, this is a sham. People aren't spending the money they have, they are spending the money they hope to have. Small business, big business, and our government are doing the exact same thing. In a country where people are literally spending the money they make, it is a good indicator that people have jobs that are meeting their needs and allowing them to prosper. In a culture that is spending on credit, it can hide an awful lot. That is what happened in the 1920's, and that is what is happening now.

People who couldn't afford houses or the money issues that come with houses, that didn't have safe jobs, that didn't have good spending habits -- were given high interest loans by companies that didn't care -- they just added more interest. They preyed off the poor. They were not in this alone though. They were forced to do so by a government that threatened penalties for not being fair. The government encouraged bad lending policies by bad lenders who did it and still sought to benefit off of people who had no business borrowing or being loaned to. Then these companies took these risky loans and bundled them up into securities and bonds and sold them to investors, who bought them because if they worked, they would make even more money. Some investors were completely ignorant that their investments contained these subprime loans, or as many as they did.

Then, a lot of banking companies, bought these and bought too many. They didn't have enough assets that were liquid, to lean on. Simply put, they invested everything they had and didn't have any cash. No real money. So when the need came up for cash at the top, the house of cards fell.

The whole problem, from my perspective is that a little kid shouted from the sidewalk that the emperor has no clothes. Actually, the Investment Empire has no cash. This house of cards is falling from both ends. The foreclosures are leaving everyone from bottom up without cash....and this combines with the lack of responsible investing in the first place means that the Lehman Brothers, AIG, etc. have done the exact same thing. They invested money they don't have, and they want the government to give it to them.

We have not been temperate with our desires. From the bottom up and from the top down, with the financial gifts that God has given us personally and as a nation.

When you look at the Roman Empire, there came a point when they conquered so much, they became scared for their own welfare. They also fell into decadence. They weren't all healthy and ready for war. A soldier class developed, and they relied more and more on mercenaries, while they enjoyed the spoils of their empire. They feared for their borders. They sought to only keep control of what they had, and they grew increasingly afraid of losing what they had...until they did.

I believe that throwing money at the investment industry will not solve what will be a world crisis. It may delay it. But I honestly don't think that we will truly recover until we face hard times. We have houses that were built for people that can't afford it. We have entire nationwide industries that exist that are completely unnecessary (Petsmart and the like come to mind). We have grocery store chains that are completely dependent on being able to get food from across the world when most of us can get the food we need from local farmers, if those local farmers were refocused on feeding their own communities, rather than growing only two to three major crops, and only a couple of varieties of those making a blight much more probable at some time, and shipping the crops elsewhere. When we have people who throw their credit cards at what they want, and their 3/4 of their daily well-being relies on machinery that they themselves are completely ignorant on how to fix (me included).

The hard times can be a blessing from God, too, to return us to basics and teach us to provide for ourselves and to love our neighbor and depend on our neighbors, rather than being completely focused on our own needs.

I don't know if this will begin to happen Monday when the markets open. It could, depending on what Congress decides. If not, it will happen in the future. I fear that it will be even more serious if it doesn't happen soon, no matter how much I dread it.

But I don't believe we NEED a $700,000,000 rescue. I believe that this isn't recovering us to health, but replacing the conditions in which a cancer has been running rampant. Cancer treatment is terrible, risky, and painful, and it is right to fear it. But if it is not truly treated, but the pain only treated, then it continues to grow until there is no hope for the body. In the end, it is better to face the cancer and eradicate it, to endure pain and suffering that has hope of producing real health, than ignore it by popping another Tylenol.

God help us.