Adam Smith and the Ruin of Nations

April 25, 2008 at 11:55 am | Posted in Political | Leave a comment
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April 18 – Associated Press (Alan Zibel): “Sallie Mae says it cannot write money-losing student loans indefinitely. Top executives are holding ‘daily deliberations’ about just how long the nation’s largest student lender can afford to sacrifice its bottom line for the sake of college-bound Americans, Sallie Mae CEO Albert J. Lord said… Experts said that, unless the government intervenes or market conditions rapidly improve, Sallie Mae could have no choice but to stop writing new federally backed loans… Even though the majority of student loans are highly rated and carry a federal guarantee, investor demand for securities backed by these assets has plummeted — a sign of just how nervous investors are about securities backed by mortgages, student loans and other debt.”

What should one make of a nation whose young people are not considered virtually assured of having easy power to repay their student loans following graduation? What is the “be all, know all” market (and its famed magic) saying here?

The message is a loud and clear vote of no confidence in the capacity of young Americans to prosper.

Vocal defenders of grossly unregulated financial markets are, indeed, responsible for an incredibly imbalanced economic environment in which money-changing has gained ascendancy over the means of producing lasting wealth. The diminishing of educational opportunity is, in fact, the natural outcome of a world-view where the elevation of human potential is held captive to sheer greed. And now the endless chain of evidence forming since Richard M. Nixon was President is moving to crush even our children’s hope.

This, Adam Smith’s moneychangers have made reality through their devoted worship of the magic of the marketplace. Livelihoods be damned!

The solution, really, is simple. Read the Constitution’s Preamble. Everything in this country must serve the good of the People.

And this includes capital…


Now to Dumb Down America

April 16, 2008 at 4:10 pm | Posted in Political | 1 Comment
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April 8 – The Wall Street Journal (Keith J. Winstein): “Education Resources Institute Inc., a Boston nonprofit that insures more than $17 billion in privately issued student loans, filed for bankruptcy-court protection, beset by defaults, delinquencies and shrinking revenue. … The filing … adds more tumult to the shaky student-loan market, where some lenders have been taking write-downs and dropping or curbing their lending programs amid broader problems in the credit markets.”

SUNY PotsdamWhen “competition” does not live up to its oft-marketed capacity of offering consumers “more choice” … and instead closes opportunity … what should we make of this?

Unregulated free markets are a fraud … benefiting the few at the expense of the many.

And while we are on the subject, let’s get something straight. There is no such thing as a free market. “Someone” always controls every market’s workings.

So, we are left to wonder for whose benefit should this control serve in the nation whose government is constitutionally charged to “promote the general Welfare.”

(Note to insurance industry: Thank you for showing the People how profitable your business can be. We shall have your business model in mind when revenues are squeezed.)

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