Sacrifice Now or Sacrifice More Later: Financial Institutions Must Be Held Accountable

America is at a crossroads. Our financial institutions have been given unregulated freedom to pursue profit in any fashion they chose. Free enterprise has been functioning as if it were on steroids. A great many people have been able to produce a great deal of capital without production of any tangible product. It has truly been a "brave new world" where it was not necessary to do anything but find new and innovative ways to produce profit - increased interest rates, fees & charges, options, options on options, bundled paper, and hedge funds. What do we have to show for allowing the financial institutions to have free reign? Has America's gross national product grown? Has the standard of living for all Americans has been raised? Is our international prestige enhanced? Has our trade deficit been reduced?

The answer to all these questions, I'm afraid, is a resounding and universal negative! The result of putting our trust in the dedication of the financial industry to the best interest of Americans has been the creation of the greatest economic disaster since the great depression - and perhaps even greater! It was only possible to salvage our economy by engaging in global warfare, and at that time we had the greatest industrial output in the world - and there were no nations with nuclear weapons. Times have changed.

America has now created the greatest national peacetime debt in it's history! Although American exports from the manufacturing industry were the most significant element in our balance of trade, the fact is that it represented only about 12% of GDP. With that level of manufacturing combined with the outsourcing of more than half of American manufacturing capacity, the United States would be hard-pressed to mobilize sufficient manufacturing to support a major national conflict! When this fact is combined with the lowest prestige the United States has ever had in international diplomacy, American national security is in an extremely precarious position!

It's truly a paradox that productivity of American workers is at the highest level in history, with no accompanying increase in earning power or discretionary funds. The level of national personal savings is in the negative, which means that if the typical American should encounter an economic crisis because of job loss or uninsured health issue, the would be forced to renege on their credit. Health care has reached unimaginable cost levels that have put nearly half of all American workers in a situation where they are either uninsured or underinsured. If it weren't for the depressed prices of fossil fuels because of diminished demand, or if oil prices should suddenly surge above the $100.00 a barrel level again, it would be devastating to America's economy!

So it's probably safe to say that things probably couldn't be worse for Americans - if it weren't for the tenacious nature of human beings and their adaptability! By the grace of God, the people of the United States seem to shine when they are facing a crisis. Yes, Americans are reaching out to one another to overcome the grave economic setbacks they have been subjected to. Families and friends are banding together to help one another through the loss of employment, health, or homes - God knows that the government, of which I am a part, is not able to do so when the need for government services is steadily growing while the revenue to address these needs is steadily declining! Government has no money of it's own, so when revenue from INCOME or PROPERTY taxes declines because of unemployment and depressed home values, social services and education must be cut.

Yes, even though things could not look much worse and still retain any chance of salvaging the US economy, Americans will make the sacrifices necessary to preserve the greatest consuming nation in the world, which consumes 25% of the world's resources with 5% of the world's population. President Obama has an extremely high popularity level, similar to George W. Bush after September 11, 2001. Americans want him to succeed in his efforts to bring them through this economic crisis. Unfortunately, wanting him to succeed, and willingness of the vast majority of Americans to make sacrifices to ensure that success, will not ensure his success.

The fact is that if nothing changes, nothing changes. If Americans continue to see bonuses being paid with taxpayer funds to those at companies like AIG who caused this disaster, while ensuring that these companies suffer no financial consequences for their imprudent, immoral, and often illegal behavior, the US Government will have lost it's opportunity to implement guidelines to ensure this will not happen again. Not only that, but if the financial institutions continue to hole their "toxic assets" in hopes of absolving themselves of any financial losses by shifting their losses to the American taxpayer, they will have absolutely no incentive to make the changes necessary to avoid another catastrophe in the future while using their resources to promote sound economic investment policies and next year we will be right back where we are now - except that President Obama will no longer enjoy his present approval ratings and government will not be able to take another $2 trillion dollars of taxpayer debt to save the companies which are "too big to fail". Failure to take solid and substantial action NOW will not only be dangerous, but most likely catastrophic! That action means compelling the financial institutions to take their just portion of losses for their imprudent investments while ensuring all the bail-out funds will be paid back, putting reasonable limits on bonuses and salaries by indexing them to wages, reducing and regulating grossly unfair interest rates and fees, and providing incentive to reinvest in American manufacturing capacity in a green capacity among others. I cannot emphasize too much the fact that all Americans are going to be required to make sacrifices now or sacrifice much more later!