I don’t claim to know much about economics, but I know enough to understand that doing nothing about the current economic crisis would be a huge mistake. I know that people are pissed at Wall Street. I’m pissed, too. But I’m appalled by those who seem to think the best course of action is just to let banks and investors twist in the wind. These statements made by Mitchell Bard on the Huffington Post are typical:
…a big part of me just wishes that Wall Street is left to solve (or not) its own mess. Yeah, I know that people would be hurt, and I would hardly be happy with that. But, again, maybe we would be better off in the long run, with a better understanding of the importance of governing the right way.
There has to be consequences for actions. Without them, a society can’t function. If Congress manages to overcome today’s setback and pass a Wall Street bailout this week, those who have profited from advocating a system that was always destined to implode will, in the end, pay no price for their actions.
Yes, we’d love to hold those fat cats responsible for the reckless way they’ve gambled with our economy, but this idea that “people would be hurt” is a gross understatement. It’s not just bankers and investors who’ll be hurt — it’s everyone. Like it our not, there’s not a clear way to punish Wall Street without punishing ourselves (or our pensions, or 401ks, or whatever).
If, through negligence, your neighbor allowed his house to catch fire, would you stand idly by while it burned to the ground? After all, it’s his own damn fault, right? But what if his house was so close to yours that you were certain that the fire would spread to your own house? Wouldn’t you help him put out the flames then? Wall Street is perhaps closer than you think.
Or, as this dumb campfire story from my youth says, “when the log rolls over, we’ll all be dead.”
Today, Barack Obama made the rather gutsy move of encouraging everyone to support the economic rescue plan that’s having trouble making it through Congress. Maybe we should listen to him. I don’t know if the “bailout” is the best of all possible solutions, but the consequences of doing nothing are simply too terrible to contemplate.