We know that past two years have been extremely distressing. With the meltdown of job market and the destruction of many sectors in the economy, ordinary Americans have struggled. But what’s not really hit home yet in the midst of a 70% stock market rally, is the real calamity that is slowly unfolding in so many municipalities and cities across the nation. It’s quite alarming. I don’t want to flash distressing data here, although, I must say that nearly 28 states are facing dire budget situations. What I want you to see is the calamitous nature of the financial crisis and how it is destroying the very fabric of our communities. Look at the video below to get a sample. City of Newark is going bankrupt and what that means is fewer policemen and firefighters, drastic cuts in basic services that people take for granted in most of the first world countries.
While banks continue to reap profits by trading esoteric financial instruments, enabled by the largesse of Federal Reserve, and stocks march on with pumpers displaying disdain for those who dare talk about the ground realities of American economy, real people are suffering and will suffer more if more cities start crumbling the way we see here.
We are in a vicious downward spiral. It’s unfolding slowly, but it is gathering momentum. Trillions of taxpayer dollars came to the rescue of big banks, which were guilty of making big, bad bets with a complete disregard for inherent risks in them, yet, they are unwilling to lend and rescue the Joe Public now. Obviously, now they are worried about risks in lending to poorer consumers, businesses and cities, who got into this mess by the very institutions who spoiled them by lending too much in the first place. Of course, everyone was party to these excesses—banks, consumers, businesses, city councils and so on—but the big guys always come out unscathed and the rest are asked to fend for themselves. Bankers made billions in bonuses even when millions were losing jobs and homes. May be bankers deserve it for their skills and the nature of work they do, but isn’t it the dharma of these institutions to put their capital into use where society needs the most, at least in times of such distress for millions? Banks have responsibility towards their investors, but aren’t they benefitting from taxpayer money? Couldn’t they minimize the bonuses or divert some of the zero interest capital they received from Feds for the greater good of the society? If capitalism embraces Darwinian rule of ‘survival of the fittest’ and expects ‘creative destruction’ to bring new species on the debris of the older,weaker ones, then banks had no right to be rescued by the government, risking taxpayer money. Yeah, but then banks are “too big to fail” for our own good! No arguing that point. After all, it is the hallmark of crony capitalism—“socialize losses and privatize profits".”
I am a capitalist, and I will continue to favor this economic system; but, I demand and hope that out of the debris of this financial crisis evolves a more humane, compassionate and far more equitable system. Let us hope that the new system embraces principles of dharma.
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