There is no need to be a forensic pathologist to understand
the cause of death of America�s financial institutions and our credibility
abroad. The only thing required is a familiarity with our history.
Over the past 29 years, beginning with the 96th Congress and
concluding with the 106th, there has been a systematic concerted effort by our
elected officials to unravel the remaining vestiges of our institutions that
represented our sovereignty as a nation. If we just round up these usual
suspects, based on reasonable suspicion, we can begin to delineate more than
just probable cause, but most importantly the direct cause of our misfortune.
Following the stock market crash of 1929, laws were enacted
to prevent another debacle: The Glass-Steagall Act and the creation of the
FDIC. Both officially named the Banking Act of 1935. These laws set in motion
the apparatus separating commercial banks from investment banks; this arrangement
worked for 64 years.
The Federal Deposit Insurance Corporation (FDIC) included
banking reforms some of which were designed to control speculation. Some
provisions such as Regulation Q allowed The Federal Reserve to regulate
interest rates in savings accounts. In 1980, congress in all its wisdom
repealed the FDIC reforms by enacting the Depository Institutions Deregulation
and Monetary Control Act.
Then on November 12, 1999, President Bill Clinton signed
into law the Gramm-Leach-Biley Act, which repealed the Glass-Steagall Act of
1933. One of the effects of the repeal was to allow commercial and investment
banks to consolidate. From that moment it only took Wall Street and K-Street
nine years to destroy our financial institutions and our credibility abroad.
The only noteworthy fact that is prologue to this disaster
is that each generation preceding us has had their own financial calamity
ushered in by unencumbered and unbridled capitalism. Each time profit trumped
public interest. The agents of our despair have treated their oath of office as
if it were an antiquated notion giving their allegiance as well as aid and
comfort to the free market, while the working man became little more than an
Each generation had its own brand of corporate and
government corruption and cronyism, and an understanding of the collusion
between the government, industry, military and the bankers. Even to a casual
observer, a pattern seems to emerge. Humanity has struggled for centuries to
unshackle themselves from the subjugation of kings, popes, empires and raw
In one generation, we have idly watched as these same
elected officials dismantled our nation�s industries sending them, our jobs and
our technology to foreign shores to be made on the cheap. America�s labor force
has been disemboweled, placed on a pyre fueled by vapors of a gossamer web that
once epitomized America�s �Promise�: that of Life, Liberty and the Pursuit of
The �Promise,� once the tapestry of this nation�s domestic
social contract, which was won by the blood, sweat and tears of those who came
before us, has been shredded by an unregulated corporate free-market
fanaticism. We on Main Street shall be left to pay the piper due to the
treasonous actions of our elected officials and our own individual
participation in this Ponzi scheme.
Philip J. Rappa is a writer, producer, director,
humanitarian and former investor.