The false left-right paradigm that divides Americans over this financial crisis continues to crumble, in spite of the tea parties which seemed to divide.  I believe this divisiveness was stoked by the media and then latched onto by far too many participants and critics.

People seem to want to blame the financial crisis on conservatives in bed with the banking industry (deregulation) and excessive spending on liberals. I understand how tempting it is to have a party to believe in but sadly, these views are both incorrect in my opinion.  Both parties are guilty on both counts.

Our problems as a nation are going to badger us until we realize that both Republicans and Democrats are in the pocket of the banking industry and other special interests (please see the “Buried News of the Week” below).

Bi-partisan action led to this crisis, and we’ll probably need bi-partisan action to get out of it, assuming politicians have the power and motivation to help in spite of the special interests.

This is a time to unite instead of fighting each other and pointing fingers at one party or the other.  (Oh, I’ll so some finger pointing in this post, but it won’t have anything to do with one political party being superior to the other.)

The Monday, March 30 issue of the Rapid City Journal had a ground-breaking column by Robert Scheer on page A13.  I’ve read several of Scheer’s columns in the past and walked away thinking that while the guy has interesting things to say from time to time, he seemed like a partisan hack and cheerleader for Obama. I was wrong about that.

I suspect Scheer just had unrealistic expectations of Obama after eight years of Bush and the Bush banker bailout. When he saw how Obama was going to govern, he again found the critical voice that he wielded against Bush.

As an independent who is middle of the road but leans right on economic issues, I can appreciate that.  (The great British economist, John Maynard Keynes once said upon being criticized for changing his mind, “When I get new information, I change my position. What, sir, do you do with new information?”)

For one of the best explanations of whom to blame for bringing us this financial crisis, please read Scheer’s column, “Obama’s toxic advisers are keeping the country from the bigger issue.”  (Available online here.)

Scheer mentions Greenspan as one engineer of the economic crisis, but doesn’t mention the fact that Greenspan also helped fuel the housing collapse by slamming the accelerator down on the housing market with artificially low interest rates, thereby helping to create the housing bubble.

Other critics cite the Community Reinvestment Act as a contributing factor to the housing crash.

What’s Scheer upset about in regard to the housing and financial crisis?

Obama has appointed Gary Gensler to head the Commodity Futures Trading Commission.

From the article, Scheer writes, “Gensler helped create this financial crisis when he was in the Treasury Department back in the Clinton era, when bipartisan cooperation with Wall Street lobbyists was all the rage.”

Scheer then quotes Sen. Bernie Sanders, explaining his reason for blocking Obama’s nomination of Gary Gensler for head of the Commodity Futures  Trading Commission: “Mr. Gensler worked with Sen. Phil Gramm and Alan Greenspan to exempt credit default swaps from regulation, which led to the collapse of AIG and has resulted in the largest taxpayer bailout in U.S. history.”  The disastrous legislation that these men supported was known as the Commodity Futures Modernization Act.  (It was signed by former President Bill Clinton.)

It comes as no surprise then that Gensler was recently confirmed.

It gets better (I mean worse).  Who else supported this legislation during the Clinton years?  Obama’s chief economic adviser, Lawrence Summers.

When Clinton’s CFTC appointee Brooksley Born “attempted to sound a warning (about the legislation), she was treated by the rest of Clinton’s team as the enemy.  In response to Born’s warning, they drove her from government…”

Can you think of a better interview for 60 Minutes than a hard-hitting piece with this very bright and courageous woman?  I don’t think they would touch it with a ten-foot pole because it would be too embarrassing for some very powerful people.

How ironic is it that the woman who sounded a very prescient warning on the credit default swap deregulation was driven out of government, while the man who was blind to the coming crisis gets her job?

How could so many smart people get this so wrong? One factor is that money from the banking industry greases the wheels of action with our Senators and Congress people.

Greed over-rides common sense, along with an arrogance that comes from being “too big to fail.”

Quote of the Week: “And the banks — hard to believe in a time when we’re facing a banking crisis that many of the banks created — are still the most powerful lobby on Capitol Hill. And they frankly own the place.”

Sen. Dick Durbin

Buried News of the Week

Senator Claims the Banking Industry “Owns” Capital Hill