Musings: Big Time Bungler

A swirl of gray clouds and a few drops of fat rain greeted Koko and me this morning as we took a slow, sleepy, short walk. We're generally on the same energy wave length — until chickens come into the picture. Then she becomes a little brown rocket at the end of the leash, and she’s not satisfied until her lunging sends them scurrying for cover.

I can’t help but take a certain satisfaction in seeing someone like Alan Greenspan knocked off his pedestal. For years he enjoyed God-like status, with all the perks and fawning and fat salaries that accompanied it.

Now it’s clear — and even he’s admitting it, kind of — that he bungled big time. According to a Reuters article:

Former Federal Reserve Chairman Alan Greenspan told Congress on Thursday he is "shocked" at the breakdown in U.S. credit markets and said he was "partially" wrong to resist regulation of some securities.

"Those of us who have looked to the self-interest of lending institutions to protect shareholder's equity -- myself especially -- are in a state of shocked disbelief," said Greenspan, who stepped down from the Fed in 2006.

That’s the problem. Those who are so wrapped up in the financial system, like Greenspan, can’t see that it’s built largely upon greed and deception. That’s the Achilles heel that trips it up every time. When the getting is good, that’s all that matters. There’s no responsibility to anyone but one’s own personal fortune-making. Then average Americans see the insiders raking in the dough and they, in their usual sheep-like fashion, also want to gorge at the trough.

And so it goes: boom, bust, boom, bust, until finally we get this giant kaboom!

The article continues:

While Greenspan was once hailed as one of the most accomplished central bankers in U.S. history, the low interest rates during his final years at the Fed have been blamed for fueling the housing bubble and eventual crash that touched off the current financial crisis.

His strong advocacy for limited regulation of financial markets has also been called into question as a result of the crisis.

So now the question becomes: if someone “once hailed as one of the most accomplished central bankers in U.S. history” can make this kind of mess, what’s the likelihood that a person chosen as Treasury Secretary by President Bush has the brains and integrity to clean it up?

But as the old saying goes, every cloud has a silver lining. The last time I filled gas, two weeks ago, it was $4.51 a gallon. Now, thanks to oil prices that have been forced lower by the recession, it’s down to $3.80. And for the average consumer, that’s a lot more meaningful than a $750 billion bailout.