Wild Greed Chase Rolls Over US Economy
In the 1980s, the Reagan Era, an attitude slipped into the corporate world, especially with the young people who were pouring into the financial services sector of the economy:
Greed is good! The purpose of a corporation is to promote the net wealth of the stockholder. CEOs should be rewarded for producing stockholder wealth by getting huge salaries — more in a day, or even an hour, than their workers earned all year.
Anything that was not against the law was not only all right but virtuous so long as it made money. It was the old laissez faire notion that individual and corporate greed contributed by some alchemy to the general welfare of the economy. The maximization of wealth swept away the idealism of the ’60s. Greed was now good and devil take the hindmost.
The smart, perhaps ruthless, go-getter on every level of the corporate ladder became the person of the hour. Credit cards rained down on the country like manna in the desert. Many people who ought not to have been trusted with credit cards could not resist the temptation to collect goods and services that they could not pay for. Collection agencies closed in on these innocents and wrung them dry. The banks that issued the cards and the collectors maximized their profits. Some lives were ruined but that was their own fault, wasn’t it?
No one worries any more about sins that cry to heaven for vengeance.
Now the chickens are coming home to roost and, to mix the metaphors, there are a lot of ironies in the fire. Many people will suffer as the market tries to absorb a “correction” before it becomes a recession. The worse losers are the poor who tried to buy homes when they did not have the resources or the self-possession to cope with their “sub-prime” (bargain basement) mortgages. Again, that was their fault wasn’t it? The mortgage brokers who made a killing on the sub-primes made a bundle. They sold the mortgages to financial institutions which in turn waved a magic wand over them and transformed them into “collateralized” bonds, many of which were picked up by the hedge funds.
But the high rollers who play at the hedge fund tables and bet on the safety of the mortgage bond “instruments” on the strength of their computer predictions lost a lot of money. The shrewd gamblers who bet against the mortgage bonds, without the help of computers, made a bundle, one of them picking up $80 million in a couple of days. A lot of people in between the suckers and the gamblers also suffered losses, especially those with money in their pension funds and those who wanted prime mortgages to buy new homes.
I’m not suggesting that all or even most sub-prime brokers were scalawags. Enough of them, however, saw the suckers coming and took them with devastating impact on the suckers — those who would not or could not read the fine print in their mortgages — and indeed on the whole gambling den called “the markets.” The quick buck brokers may not even have broken any laws.
Spooked by the collapse of the sub- prime mortgages and the “instruments” created from them, lending institutions have pulled back loans and the result is the current credit crunch that has shaken the gambling den — and the economy on which it feeds — to its foundations. The chickens are perched on all available roosts. There will certainly be more foreclosures in the months ahead and more broken lives.
Greed is good except when it gets out of control. It is in the nature of human nature that once we indulge in greed, it has a strong tendency to get out of control.
Andrew Greeley’s e-mail address is agreel@aol.com.
© 2007 The Times Union
People who are interested in this subject should visit www.patrick.net. Patrick has been blogging about this mess for over 2 years now and accurately predicted what would happen.
Congress should address this subprime mess by legislating a rollback of interest rates on all those adjustable loans to January first’s rate for three years and let the greedy middle-men take the lumps, not the duped home-buyers who only wanted their piece of the American dream of homeownership.
Help out the little people for a change. Let the greed-heads twist for once.
I watched as people I knew joined the corporate forces in the early 80s and it was something I just couldn’t bring myself to do. It just looked really bad even though they were going to have large homes and multiple vehicles and children and wives, etc. We all fell out of touch. We no longer had anything in common.
It was a long time that I was tempted to feel that perhaps my former friends were right and that I had chosen incorrectly opting out of the wealth and security thing. However, in the last few years any insecurity I may have had has changed into a kind of knowledge that the fault didn’t necessarily lie with me. The tables kind of turned.
I had the opportunity to observe the children of some of this 80s generation of people who were in the middle of the same process: choosing the corporate lifestyle and its enticements, or choosing to live outside of it.
Naturally, most of the children caved in to the same impulse and I was able to see how delusional that was (from my perspective - and I still believe that this perspective is truth to a greater degree.) Although I felt vaguely sorry for the children and the highly probable emptiness they were selecting, they had a kind of self-assuredness that made their choice unassailable. Essentially,a delusion foisted on them by their parents and “society” who had accepted this way of living as gospel.
I’m sorry, call me a fundamentalist, but I can’t accept the idea that “greed is good.” Knowing how to live life in a simple fashion seems good to me. To minimize the amount of natural resources you consume. To have what you need. In that respect I think there is plenty to go around. However, it is probable that “greed” will never go away, so learning how to live with it seems more realistic. Isn’t it one of the cardinal sins? Maybe we should go back to identifying it that way?
The market “works” when the ruthless well-connnected and well-financed predators are making millions, off of the backs of those who actually create value through hard work. When the market “fails,” that means the predators are not raking it in, and those in government, serving as stooges of such predators, must intervene to fix the problem so the predators can resume their predations.
geoff29 August 27th, 2007 12:02 pm
I identify with your sentiments in that simply economic fact WE are all dead in the long run….
Big house, little house, penthouse, budget house or shit house: WE collectively take none of it with us into the pine box….
So much frenetic effort, so much worry, so much anxiety or depression….. An old Indian Proverb states WHY RUSH TO YOUR GRAVE….
Geoff, I feel the same as you.
My awakening did not come until I had completed a graduate degree (an extremely stressful experience that I want no more of!) Now many of my friends cannot understand why “I am throwing it all away”.
I see value and peace in a simple life without all the empty toys, laud and honors. Funny how we never hear of the cultures that have the simple life values… The Kuna of the San Blas Islands and the Kogi of Colombia are two cultures that I’ve visited that are good examples.
From reading I’ve done, I believe greed is the greater part culturally instilled and the lesser part genetic.
geoff29
“Knowing how to live life in a simple fashion seems good to me.”
Yes indeed, it frees your soul.
I became convinced about that after reading Walden by Henry David Thoureau.
Texas
There are a lot of people in every country who do not want to run the rat race.
Some people move to a city in developed countries, simply because they see it as a better way to live.
Somewhere a personal decision has to be made - When is what I have enough?
When I was a teenager I aksed myself whether I ever want to make money on the back of someone who has little.
I think most businesses would be not survive on my philosophy.
So here I am, in a service sector.
But most people want to be comfortable, and some for generations to come.
They can not draw a line for how comfortable.
most of my friends with millions have stated
at one time or another
“the only happy people are poor people”
I decided to be poor when I realized
“security is an illusion”
ken
Fred Magdoff remarks that capitalist economies are “based on the profit motive and accumulation of capital without end.” The rationale of capitalism is to maximise profits among the economic elite by creating wants and needs in persons for market goods and services whether or not the desires mediated by the need-making system can be fulfilled. While some needs are legitimate, others are not. Thus, it furthers the worship of the “holy triune god,” that is, mammon, acquisition, and wealth. Since capitalism is centered on the increase of capital, labourer is treated simply as a means to produce “profit”, not as a being of intrinsic human dignity and value. The corporate greed-based capitalism creates asymmetrical socio-economic power relations with those at the top enjoying power and luxury and those whose labour is indispensable to produce “profit” becoming mere “productive voiceless machines” and languishing in hovels. On one side there is surplus and unrestrained consumption, and on the other shortage of even the basic necessities. The most corrosive impact of greed-based capitalism has been on human relationships. Attitudes formed in relation to the machines are transformed to people as well, thus promoting a culture of “productivity and success”.
Geoff29,my experience exactly.
I had the opportunity to discuss this with an acquaintance who was a partner in an early(late 1960’s) Silicon valley company that actually had a unit to build in obsolescence to its vacuum tubes in order to create more profit. When product lasted 3 years, they found a way to make only last 2 1/2. Greed!
The bandwagon was appealing. The emphasis on rewarding individual greed was rampant. Those who partook are responsible for the breakdown of unions, civic pride, charity.
I asked another friend how he could possibly vote to elct/reelect Bush when his plans were anathema to my friend’s ethos. He said,”His tax cuts have saved me $150,000 a year in taxes. I still protest, but the vote was a no-brainer.”
Just some personal experiences with Greeley’s dead on writing.
Greed being our natural bestial urge is multiplied a thousand-fold by money. An animal can’t hoard more than it can personally defend. But money lets us sabotage natural selection’s favorable greed component by allowing an increasing few of the least fit to rule by hoarding money-power without limit. Humanist alternatives abound, but bestial greed knows no bounds.
A desk, a mattress, a couple of lamps, cooking and eating utensils, a lot of books, music, a desk for reading, writing, and eating, a place to keep my clothes, some containers for water, a refrigerator, a water purifier, a clean two room shelter, a roof that doesn’t leak, a bathroom and water that goes into a bucket for washing myself, and a tank of propane for cooking. And of course, my laptop computer. Oh, and a bicycle. That is what I possess. And, fortunately, a job I enjoy.
I know my situation is much different than many others who honestly do need more “things” to get by in life. Also, I don’t have a wife and family to support. But these are the material things that I need. I get much of what I really need through friends and helping people to learn.
Don’t get me wrong. I like money. It allows me to travel and perhaps buy more “things.” I’m also pretty sure if Mr. Gates offered me his home to live in, I wouldn’t hesitate to live there. I know I’m not immune to greed. But this is where I am in life and it is all I really need, although I do miss a hot shower.
As some one else posted earlier, Henry David Thoureau’s book “Walden” did much to influence me as a young teenager. Living the way he did seemed ideal to me. It still does today. It’s people that I need the most in life. Meaningful contact and conversation. And a little unmeaningful and fun conversation or activity as well.
I think I am fortunate not to have to worry about much, especially since I have been out of the USA for some years now. I’m also fortunate to be able to read the articles and discussion on this site. I am able to learn many things I would never had known if it weren’t for the people who post here.
I will admit that it does hurt at times when I get blasted for something I’ve written. But that’s another way to learn to look at myself first before blaming others. By all indications - for me at least - this should be another good day. That’s a self centered thing to say but when I say that, it doesn’t mean I’m not also aware of the suffering going on in and around this Earth. The best I can do each day is to try and change what I can change for the better. To help someone.
“No one worries any more about sins that cry to heaven for vengeance.”
The Church should be more vocal on the evils of theft & corruption, and less concerned about about matters of personal conscience in sex & reproduction; of course the state would then suddenly find the Church a liability rather than an asset, and ‘under God’ would vanish from the pledge of allegiance overnight . . .
Fr. Greeley’s been telling these inconvenient truths for sveral decades now . . . .
Contrary to ezeflyer, greed is not a matter of human nature, or else altruism, compassion, generosity, and charity, let alone a chosen simple life like those attested to above, would not be humanly possible. Previous generations classified greed as one of the seven deadly sins (lust, gluttony, greed, sloth, anger, envy, and pride) and as a vice. Sins and vices are only sins and vices if the persons enacting them have alternative modes of behavior available.
Like the other seven deadlies, as Greeley points out, greed “has a strong tendency to get out of control.” I’d say there’s more than a mere strong tendency involved. All the vices when acted on are unsatisfying because whatever satisfactions they provide, and they often do provide some satisfaction, are short lived. To act in a vicious way is automatically to feel the need to act again in the same way, which will be unsatisfying, so again the demand to enact the vice will be felt.
The more vicious people are, the harder it is for them to reform, as our ancestors understood in warning agains getting started on the vicious cycle. After some 25 years of praising and rewarding vice, it’ll be one hell of a job to become decent human beings again.
“Greed is good except when it gets out of control. It is in the nature of human nature that once we indulge in greed, it has a strong tendency to get out of control.”
That’s called an ADDICTION. Addictions need treatment, or they eventually kill the addicted. Using money to earn more money just for the sake of earning more money is a mental illness, a major symptom of which is a complete disregard for the consequences of your actions, as long as the insatiable greed void is temporarily filled. That is never “good,” and shouldn’t be confused with a normal, balanced desire to earn a fair market price for your products and/or services.
For a man of the cloth or one who has been one to say “that greed is good” is unconscionable and contradicts his “good book,” which says, “For the love of money is the root of all evil.”
That’s not so different from Karl Marx words on the same, “Capitalism carries the seeds of its own destruction,” but then Marx and Christ were both long haired socialist Jews. But they were right, even though today we would have to say they were because they were left.
There is one word that has never been mentioned either in the article or in the postings: Class.
For 4000 years richfilth killer elites from any of the Aryan families: Persian; Greek; Latin; & Keltoi have wanted just one thing: Everything, Forever.
Every society we have ever built was a one trick pony: Transfer wealth from the general population to the ruling elite families & clans through conquest and by owning our labor. These societies have 3 levels or classes: Masters, Overseers, & meat for the machine. We’re the meat.
Don’t be fooled by the generalized abundance produced by the Roosevelt Legacy - that was not us. That historical ‘mistake’ is not and never was who we are as a people. We are a top down, authoritarian, patriarchal, feudalistic slave society. Always were, are now, and we will die that way. Richfilth require, demand, and impose grinding poverty. It’s in their blood. This is not about personal greed. It’s about a society that is constructed to transfer wealth UP the food chain.
Try to change that core structure and you will become an Enemy of the State. Just look at the histories of every major leader in any sizable social or economic justice movement over the last 100 years – hounded into silence or suicide, falsely imprisoned through planted or doctored evidence, or simply executed on the street or in their beds. They were all Enemies of the State. Before the animal Reagan opened the flood gates to the monsters there was a lot of killing that got done first.
Don’t matter. It is the doom of men that they forget.
Peece.
GANDHI & JPOVERSEAS: Good points.
GEOFF: I, too, live simply and feel so much freedom as a result. While a lot of my friends LIVE to pay their mortgages, my time is my own. I get enough free lance work to pay a minimal mortgage. The choice was to live in a rural area where real estate is not highly valued (and travel once every few months). People can live on little and when they do so, they tend to feel more in touch with the GRACE behind all things given. A child who gets to experience TIME with his parents, a child whose siblings invent simple games with a rock and a stick, is happier than one with a bedroom of plastic or other toys, all sitting like some kind of diarama cut out of shopping mall.
TEXAS: Have you seen the film on the KOGI where they explain how “younger brother must stop drilling THE MOTHER,” as they are bearing witness to the rains at the top of the rain forest (an ancient elemental covenant that’s lasted many centuries) ceasing from falling. If you have anything in the way of experience to share (with the Kogi), I, for one, would love to hear about it.
We will never see the end of greed in this world, but we will always have good unselfish, sensible people also to make life worthwhile. It is hard to believe CEO salaries and how anyone with a conscience could even accept such a huge amount. Also the sme goes for lenders that used tricks to lure people into an impossible mortgage situation. However some blame must go to the borrowers that refused to take the time to see that unless the value of their purchase took off like a rocket, they would face foreclosure. These are probably the same folks that buy lottery tickets on a regular basis hoping for the big one, but would not think of investing a small amount weekly or monthly in a mutual fund or even a good savings account. Some of the borrowers have also fallen for the idea that just because they can get the 4 or 5 year loan on a new vehicle, boat,etc it must be alright. If people do not have the self control to buy only what they can afford then they are destined for disaster. I could, after many years of going without and saving or investing every scrap that my family did not need, write a check for a new automobile. However, we have one that is 17 years old and serves the purpose beautifully as it has been
taken care of. Someone posted that their friends said the only happy people are the poor, which should be no problem, it is easy to become poor. I have been there also, and guarantee it does not make happiness, any more than extreme wealth.
Conservatives have never overcome their bestiality. They are greedy, selfish, deceitful, conniving, fearful, crooked, murdering, reactionary troglodytes. To a degree, conservatives have not claimed the humanity separating us from our animal ancestors that don’t know about social justice and equal opportunity, ecology, non-violence, decentralization, economic justice, feminism and gender equality, respect for diversity, future focus and sustainability…wait a minnit, that’s the Green Party platform!
Greed = Spiritual Blindless
It is simply not true that greed is intrinsic to human nature. That is a Euro-centric belief. Many cultures around the world see greed as unnatural behavior, and others simply have no concept of it. In his famous book on Native American religion, The Soul of An Indian, Charles Eastman (Hakadah) explained that among his people, the Sioux, status was achieved in the opposite way than it is in our culture. It was not the acquisitive that gained honor but the generous–the people who held the highest status were those that gave away the most. Occasionally, someone would give away everything he owned and that person would be held in higher esteem than anyone else. I remember when I was young and we used to visit my father’s people in Pawnee, Oklahoma. Celebrations would be held like birthdays, graduations, anniversaries, the birth of a child, etc.; and instead of the guests bringing gifts to the honoree, the honoree would give gifts to the guests. These giveaways were considered serious events and the hosts would often go into debt. The “whites” in the town used to make fun of how hard the Indians worked only to turn around and give it all away. They couldn’t see that there is more satisfaction in giving than in taking.
Greed is one of the big doors to Hell. When I was a kid growing up in the church (Anglican), when they passed the offering plate around the priest would always repeat “It is better to give than it is to receive.” I believe it. So why do the right-wing Christians believe “greed is good?”
Greed is good?-my 87 Mercury and a 2007 Landrover cross the same bridge and end up side by side at the next red light.
Greed is good? new banks from bank chains are built everyday ,but its depositers pass book savings ratte in all of them is only around 2 percent.
Greed is good? Hospitals are now a place you go to give away most of your wealth to insure one more day of living in a plastic world.
Me, I have never been greedy. Now it looks like my wife and I are either on our way to Homelessness or the cemetary. My wife was in a bad auto accident and has been in several medical facilities for months.What little insurance and savings we had lapsed in days,
Medicaid keeps dragging its feet. My rent is about all I can pay. probably in October I will not even have internet service. No I haven’t had cable tv for over a decade.
My wife and I tried to live a simple life, buying groceries at cute rate prices clothes on sale or at 2nd hand shops old vehicles with no monthly payments.
Greed to us was a forign word. when we ate at a resturant we tipped well for our meager meals we always gave at church whatever we could afford and if we saw someone in need we were always good for a few dollars.
GREED? I have both my own sister and a sister- in- all that are deathly afraid we might asked them for a few dollars
All our so called friends keep a wide distace from my wife and I most likely for the same reasons.
My wife cares about this more then me.
You see I knew oneday what has happen to us would happen. I knew that we would be on our own. As I watch what once was our few poccessions go out the door.Yes I will most likely miss them this winter. We will most likely try to find some kind of shelter. But we still have a trump card . We can say kiss my ass would and just die. We will keep the two graves next to our son. A small country cemetary We will become boxes of ashes no funeral
and let the greed continue until it implodes and destroys what is left of this country and world.
By the way CORPORATE Greed could have never got a foothold if it wasn’t for them deviding We The People first. Enchanting us into super debts encouraging us to throw away stuff that still works for new generations of stuff that will only have a short stay in our homes until another generation is offered.
Homes are not homes anymore but fortresses.
Neighbors are not neighbors either, they are just temporaily residents that commute and then move to other jobs.
I guess with all these words I am just trying to say GREED today is everywhere. And yes if you look hard enough at my wife and I it is also with us.
Ah now the IF ONLY No it is too late and it can never happen
genaman, that’s a heartbreaking situation you and your wife are in. But hey, hang in there.
genaman, many of us are just one hospital visit from where you are. I & my wife have pretty good insurance, but a big hit like yours would eat it up quick, but know this:
We are all connected at the heart. We are not all greedy.
I do what I can for those within my reach. Where do you live? Maybe I or some friend of mine lives close to you.
Hugs,
Ray
Houston, Texas
One tragic effect of all this greed is that while people try to sell their homes to pay debt, as their
credit goes bad their homeowner insurance rates will go up.
The justification for this by insurance companies is that there is supposedly a correlation between higher insurance claims and bad credit. This should never have been made into law. It is further evidence of insurance company greed. The working class may have more insurance claims because they have old rusty cars and live way outside of the desired neighborhoods.
And they have no health insurance.
Many elderly people whose entire life savings are in their home (or the children who care for them) have been preyed upon by lenders in the refinance boom that let people use their home as an ATM. Often the refinance was needed to pay off credit card debt that was incurred to buy medicine and groceries.
The stress on families who work, have children and elderly parents is taking it’s toll on our society. When there is an unexpected job loss, illness or accident families can be destroyed.
My mother was dealt a losing hand in this life. I won’t go into details. What I want to say here is that I’m always very greatful for the underpaid and overworked people doing social service.
These people give and give to try and make a difference in the life of just one person. Years ago I was talking with a woman who worked with the homeless, or the addicted, or the men who were in and out of jail. Many of these men one could justifiably say that they didn’t deserve the help. Her reply was that if just one of these men were to change, that would make her a happy person.
We need each other much more than we need money. It’s people that I need most in my life. My gratitude goes out to all those who are out there trying to help just one person live a better life.
GREED-ANGER-CRAVING ~THESE DESTROY THE SOUL
Buddhist nailed the psychology.
Greed is a form of desire and (Dharma 101) DESIRE LEADS TO SUFFERING. But I am not so sure that those involved in the feeding frenzy have souls. And the suffering they are creating is experienced more often by the victims than by the perpetrators.
And the wise author said, “Anything that was not against the law was not only all right but virtuous.” I happen to think the ethic of amorality has gone far beyond this statement.
Breaking the law is perfectly acceptable in the brave new corporate world.
The only crime in thier universe is getting caught.