Obviousness is Obvious

In the world of common sense, this statement would be obvious: "Too Big To (allow to) Fail" is "Too Big To (allow to) Exist". Otherwise, you are always on the hook for bailouts and concessions to these institutions. Simple, no?

But Washington, DC and Wall Street don't live in the land of common sense. They live in the land of automatic welfare for megacorporations, but no welfare for the poor or out of work. They live in the land of socialized corporate losses and bailouts, but no "socialism" for the citizen regardless of the social good. They live in the land of what's good for big business is good for everybody, even when it isn't. They live in a land where obscene profits are a "right", but a roof over your head, food in your belly, and care for your health are unearned "entitlements" and "privileges", to be doled out by your corporate masters for good consumer behavior.

When they repealed Glass-Stegal, (look up Gramm-Leach-Bliley Act) they lined their own pockets, created the "too big to fail" (or be regulated) monster, and doomed us and future generations to indenture to international corporate interests. The "Reagan revolution" had "succeeded", for those who were behind the revolution. The rest of us a stuck paying the bill.

I have nothing against real businesses, that either produce real goods or real services. But when corporate quarterlies are more important than giving value to customers for money, it's not a real business any more, it's a leech on society.

When the average person can't understand "complex" securities, it indicates that those financial instruments are probably funny money, and possibly fraudulent. The kind of companies whose "lifeblood" is trading paper and promises need to be eliminated - broken up, regulated,or closed with their corporate charter revoked. Enron, WorldCom, AIG, and others like them need to be stopped before they suck more of our real wealth into their maw.

Those who trade in pure paper (CDOs, SIVs, futures, etc), not backed by real goods or real services, need to be run out of business (and out of town) on a rusty rail.

Paper burns at 451° F - phony, made-up "securities" aren't even worth the paper they're printed on. Burn them for fuel.

The Deregulators - Conservative Malfeasance and Abuse of the Public Trust

Depository Institutions Deregulation and Monetary Control Act of 1980: While this allowed a few better banking services (for higher fees), it is also why savings account interest rates dropped like a rock (from 5% or 0.5%) while credit card rates rose. Where'd the money go? Into shareholders' pockets! The customer got screwed coming and going.

< href="http://en.wikipedia.org/wiki/Garn-St._Germain_Depository_Institutions_Act">the Garn-St. Germain Depository Institutions Act of 1982: This piece of work was a Reagan Administration pet, and led almost directly to the Savings and Loan crisis of the late 1980s - after Reagan was no longer in office, but his ideological heirs were still going strong. The S&L problem was chalked up to an anomaly, a few "bad actors", and the Republicans were never held accountable.

Instead, they dismantled *more* of the depression era regulation that was designed to prevent our current crisis with the Gramm-Leach-Bliley Act of 1999. A pile of Republicans, riding high on their "Contract OnWith America" and their ongoing witch hunt of the Clintons, pushed this doozy through with enough votes to override a veto, even if Clinton could have with them digging into his private sex life.

Because of this, the Republicans and their corporate sponsors (and the Democrats that sold out to the megacorps) undid all of the Depression era legislation that was put in place after the last great financial meltdown (which was global then, too) to prevent it from happening again.

They all knew why the legislation had passed, they just either a) didn't care, as long as they and theirs got rich, or b) assumed that it couldn't, wouldn't happen again. I'm inclined to believe "a)" out of the Republicans, and "b)" out of the Democrats. (Yes, I'm saying Republicans are avaricious and Democrats are stupid.) But the majority behind this crap were Republicans.

Yes, some of the regulations were dated, but they threw out most the meat with the bones in the stock.

So, when the financial ship of state runs aground, the Republicans put up up washed up candidates for election, hoping that they won't be stuck holding the bag. It worked. Even if Obama was a Saint, with the capital S and all, he would not be able to stop the meltdown. The seeds for the disaster were sown by the Reaganites in the 80s, and watered very, very well by the Gingrich cohort and their Contract On America.

IMO, any institution that requires bailout money that exists because of these deregulations should be denied. They asked for this, they wanted it, they should bear the consequences.