Banking on thin air

TIME.com is running an interesting article on the American banking crisis and why bailout money has been disappearing like water on a hot stove. The banks are actually in worse shape now than they were before the bailout. Reassuring, eh?

I'm not going to rehash the whole thing here. You know where to find it. The most interesting thing in it as far as I'm concerned is how the underlying cause - banks lending massive amounts of money they don't have. Before 2004, banks could lend 15 times more money than they actually had (which strikes me as pure lunacy right off the bat). Then the SEC lifted even that restriction and things got even worse. Compound the problem with high-risk loans and you have the recipe for disaster.

"Changing the net-capital rule was an unfortunate misjudgment by the SEC," says former SEC official Lee Pickard. "It's one of the leading contributors to the current financial crisis."

That has got to be the understatement of the year. What the banks were banking on was the inevitability of unending good times. And you thought banks were institutions of stodgy good sense. Not when you dangle an easy buck in front of them, they're not. Common sense and integrity get left behind in the dust.

All of which leads me to the conclusion that if you abandon common sense, no matter what your computer models tell you, sooner or later reality will bite you in the rear. I wish I could say that things look hopeful for common sense, but I'm not inclined to be optimistic. Having rubbed elbows with the right people is still much more important than showing signs of common sense or integrity. Just ask Timothy Geithner. Despite all the change that's been promised, being an insider is what still really counts, and insiders scratch each others' backs.


Technorati tags: Banking, Economics

An apology of sorts from the CBC

Stephen Taylor is running a clip from last night's CBC news broadcast in which Diana Swain apologizes on behalf of the CBC for not making it clear that Harper was not responding to the protester preceding him on Christina Lawand's newsclip. You may recall that Stephen Taylor had done a devastating exposé of the report, putting Harper's comments back into context and showing how that put an entirely different spin on things.

Most commenters on Stephen's blog felt that this was the best we could expect from the CBC although some were of the opinion that the apology was totally inadequate.

Far from displaying the merest hint of contrition, the tone suggests that they are reluctantly obligated to apologize because of the poor comprehension skills of those who complained. "It appeared as if the Prime Minister was responding directly to that particular protester."

Well no, it didn't. How could the PM, at a later press conference, possibly have been aware of and responding to the CBC's selected soundbite from a protest? The issue is that Lawand and her producer tried to make it look that way.

The CBC manipulated the edit to serve an obvious editorial agenda. They apologize, in effect, for a supposed editing mistake that accidently gave a false impression, when it is baldly obvious that the edit served the purpose of the entire piece, and was completely congruent with the editorial tone.

What about the totally gratuitous Bush/Harper slur in the piece? What about Lawand's insinuating tone of voice in the opening line when she refers to Harper meeting "a safe distance away"?

[...]A credible apology involves acknowledging what the wrong behaviour is, and a promise to change. I don't see a hint of that. We shouldn't be so credulous.

While I agree that the apology was inadequate and failed to acknowledge that the "misunderstanding" had been deliberately engineered, I am heartened that the CBC felt obliged to address this issue publicly. This is a tacit admission that they were surprised by the volume of complaints and felt the need to do damage control. I hope it also means they are aware now that any future shenanigans run a real risk of being exposed. We owe Taylor a debt of gratitude.

Technorati tags: CBC, Christina Lawand

In search of an honest politician

"Blessed are those who hunger and thirst for righteousness, for they shall be satisfied."

Huh? How did she get from honest politicians to the Sermon on the Mount?

Patience, Grasshopper, all shall be explained.

I've had some fairly emotional arguments on the possibility of the existence of honest politicians. What really gets me going is the offhand dismissal of shenanigans by elected representatives with the cynical observation that "they're all like that." The subtext (and far too often the open text) of this is that we should vote for them anyway, because NOBODY is going to be any better, so we might just as well line up behind the one who fills our trough the best.

This just about drives me frantic, although I do my best to keep my composure, because yelling at somebody has a pretty poor track record as a technique to change people's minds.

But I reject this argument wholly and completely. I don't believe for a minute that they are ALL like that. Granted, I'm considerably more cynical than I was three decades ago, and yet I still hunger and thirst for righteousness, or if you prefer, uprightness, first and foremost in my own life. Not only that, I've got a husband who might just as well sign integrity as his second name, which was not a small part of what attracted me to him in the first place.

So why should you give two hoots about my morality, or attempts at it?

Because I am not alone.

While I may often be overly and unjustifiably impressed with myself, I'm not foolish or arrogant enough to believe that I am all that exceptional. We may not be a thundering majority, but people who honestly believe in and strive for integrity, however imperfectly, are out there and it stands to reason that every so often, one or two of them run for public office and in spite of everything, that they occasionally even get elected.

I'll go even further. I believe it's possible for a more or less corrupt politician to sometimes choose to do the right and honest thing just because it is the right and honest thing, if only as an infrequent sop to his conscience.

So I will continue to hope for and even demand integrity of my elected officials. I have every right to, and now and again, I will actually get it.

And when I don't, I'll feel entirely justified in throwing the bum out on his or her ear. The last thing I want is recognized crooks perfecting their corruption techniques at the public trough.

Technorati tags: Integrity