Wednesday, December 24, 2008

Where is George Bailey when you need him?



We celebrate this Christmas in perhaps the worst national (and global) crisis since the oil shortage of the Carter years, and some say we will face the worst economic crisis since 1929 … a sort of “Great Recession.”

This made me think of one of my all-time favorite movies, “It’s a Wonderful Life” with Jimmy Stewart as the civic minded George Bailey and Lionel Barrymore in the role of the evil and greedy capitalist, Henry Potter.

For those of you who have not seen the movie (perish the thought); Mr. Potter is a banker who is attempting to take over Bedford Falls by buying out other businesses. The one business that stands in his way is a small, family owned savings and loan owned by George Bailey’s father. After the father’s death, George Bailey takes over his father’s savings and gives up his dream of a trip to Europe in order to keep the savings and loan afloat during a run on the bank. He ends up staying in Bedford Falls and spending the next 25 years on a small salary, raising his children and helping his neighbors and working friends get sufficient credit to own their own homes. At a critical moment, Mr. Potter steals the money from Baileys bank deposit, on Christmas Eve, just as a bank auditor arrives to look at the savings and loan books. Bailey despairs and considers suicide and expresses the wish that he had never been born. An angel named Clarence is sent to him to show him what life (and Bedford Falls) would have been like if George Bailey had never existed. At the end of the movie, George gets his life back, and all of the friends that he has made through a lifetime of service and friendship show up with contributions to make up the deficit. He is called the wealthiest man in Bedford Falls because of the integrity of his good name and the trust and loyalty of his friends. George Bailey is a good guy. He puts the collective good of his town, his business, his employees and his neighbors ahead of his own self interest.

For the sake of clarity, lets do a quick review of the recent bad news. First, investment giant Bear Stearns went under. There was a bank run in California in July and by Sept. 7, Fannie Mae and Freddy Mac were put on conservatorship to keep them from collapsing. News began to come out about their executives bailing out with golden parachutes consisting of hundreds of millions of dollars in bonuses.

Then Lehman Brothers went out of business on Sept 13 after failing to convince the Federal Reserve to provide assistance. Then, on Sept. 16, AIG successfully demanded a bail-out from the Federal Reserve to the tune of 85 billion. AIG executives promptly yelled "YIPIIIIEEE! went on a lavish company retreat to celebrate and spent God-knows how much money on drinks and massages. Bank of America purchased Merrill Lynch on the cheap. On Sept 17 Bernanke and Paulson convinced President Bush that urgent action was needed to prevent an economic meltdown worse than 1929. Bush went before Congress on Sept. 20th to ask for a 700 billion bail-out package

While unemployment rose to its highest point in over 20 years, the executives whose greed and mismanagement contributed to this mess continued to get million dollar salaries and million dollar bonuses. The ratio of executive pay to the salaries of average employees grew from about 60 to 1 in the 1950s to over 500 to 1. click here (for the rise in salaries of CEOs of Defense contractors since 9/11, click here)The rich have been getting richer and the poor poorer. The middle class who buys all of the damn consumer crap is shrinking.

But wait… it gets better! Shades of Mr. Potter.

Just when we think that maybe the crisis is subsiding, we find out that the big three American automakers in Detroit are running out of money and may go bankrupt. If this happens, hundreds of thousands of jobs will be lost, and multiple business will fail. “We cannot allow this to happen!” say the CEO’s of Ford, GM and Chrysler. So, crusading to save the American way, these courageous capitalists mount up on their private jets and fly to Washington (in three private jets) to the turn of $20,000 round trip EACH, compared to $180 for a seat on a commercial airline. Now, this is just staring to look ridiculous. Ford CEO Mulally’s employment contract was 28 million last year …let me repeat that … 28 MILLION! And they (CEOs AND Congress) are calling for labor to take the hit and reduce their salaries… give me a freakin break….

And if this is not enough … now we have the news about Governor Blagojevich attempting to SELL a U.S. Senate seat to the highest bidder, and another 50 billion investment dollars are lost to a giant ponzi scheme that ran over a 20 year period and was overlooked by federal regulators. Go check out former chairman of the Nasdaq stock exchange, Bernard L. Madoff’s investment web site, it is appropriately in black for mourning. One investor has already committed suicide. And we used to look down our self-righteous anglo noses at Latin America for its corruption? Please.

Are we getting the point yet? It is one thing for Alexis de Tocqueville to talk about “self interest rightly understood” in 1830 when people still had a Judeo-Christian moral foundation … now we are not talking about the invisible hand of the market being self interest, but the cloaked hand of naked greed unchecked by any kind of morality. And while the ship is sinking, Limbaugh and Hanity keep ranting and raving against democrats and liberals and about ‘personal responsibility’(and what about 'social' responsability?) and the land of 'free market' opportunity (that dawg don’t hunt no more), the Republican national committee is already attacking our President-elect even before he is sworn in (click here), and the lunatic left is also attacking our new President for reaching out a conciliatory hand to moderate evangelicals by inviting Rick Warren to offer a prayer at the inaugural. This is ideological mystification of the body politic in the extreme.

And it is not just the banks, automakers, congress, the federal non-regulators and CEO’s that are the problem: WE ARE all the problem. We have all caved into greed, the housing bubble, and rampant credit card debt. We have all sinned and fallen short (Romans 3:23) … trickle-down economics has turned into trickle-down self-indulgent greed … we have become a society of Mr Potters and there are no George Baileys around to rescue us. The U.S. has become Pottersville and the bill has come due. We have turned politics into a uncivil war … the “politics of destruction” that Clinton warned us about. “My friends” (to quote John McCain) we have met the enemy and the enemy is us.

It is time to rethink our paradigm. Are we fed up enough yet? If there are any George Baileys out there, they probably invested with Madoff and are now, on Christmas Eve, standing on the bridge thinking about jumping. Where are the good angels when you need them? Clarence, Monica, or Gabriel, are you out there? Right now would be a really good time for a little help. Merry flippin Christmas everyone ... this year the grinch wins.