BBC survey shows world disenchanted with capitalism

By Donald Hank

Soon after last year's disastrous bank crash, liberals and RINOs were quick to infer, from evidence to which only they seemed to be privy, that the capitalist system was flawed and needed regulation. Even conservatives seemed confused. Oddly, no one could come up with a uniform regulation design that would fix things or prevent such a crash. Something didn't seem right about their take on the causes.

Not long after that, conservative pundits made an amazing revelation: Starting in the Clinton administration, an old banking law, the Community Reinvestment Act, passed under Carter for the purpose of channeling mortgages to the poor, had been strengthened. As a result, banks had been strong-armed into issuing mortgages to "underserved groups" meaning Hispanics and African Americans. Those that refused were harassed by radical groups like ACORN and/or blacklisted and/or sued by the government. Those that complied were given the highest marks and put into enviable positions from which they could make more money. The shrewdest lenders realized that this was a government-supported racket with which they could enrich themselves at little risk, as long as Fanny and Freddy were willing to back up their seemingly foolhardy lending policies. So they continued the game, and even lenders not subject to the CRA were soon cashing in, realizing that the government actually wanted them to play Russian roulette with public funds. Even when the inevitable crash came, they thought they were protected. Indeed many did get bailouts, but because of the innovative banking practice of bundling, or derivatizing, these mortgages, and then securitizing them — selling them as "securities" like stocks, bonds and mutual funds, the risk was actually multiplied to the point that even the bailouts were no longer a safeguard, because, surprise, even the US government isn't too big to fail. The banking world on both sides of the pond, moving in lockstep like lemmings, sold and bought such "securities," many made in the USA but also many homegrown ones, and a global disaster ensued that you are now witnessing, perhaps in person.

I know that many of you are aware of this background of the crash, but there is a whole industry devoted to telling you that this historical fact, authenticated by responsible, sober economists like Thomas Sowell, never happened. This disinformation campaign, supported by the mainstream media and universities, is overwhelming in both its magnitude and its absurdity.

I discovered this firewall of lies and distortions serendipitously while looking for articles on the issue. I had not read or heard anything lately on the causes and had also heard a Keynesian investment advisor on the radio boldly proclaiming that the capitalist system needs regulation to prevent such a crisis from recurring. Over a year ago, Sean Hannity had tried to tackle this issue, but I noticed that his grasp of the facts was a bit slippery. Later, the rest of the pundits also just dropped the ball. In retrospect, it is easy to see why. People are lazy by nature. There are a lot of esoteric concepts and language in this issue and it takes a bit of study. And after all, what's it matter? We are only talking about your survival (please excuse the sarcasm).

To get to the bottom of this, I typed "cra causes bank crisis" in my search engine and found, compared to the legitimate articles plausibly describing the role of the CRA and government meddling in mortgages, about 20 times more articles either downplaying the role of the CRA and Fanny-Freddy and the strong-arming of banks or actually bold-facedly declaring that the CRA had absolutely nothing to do with the crisis. The gist of each one: capitalism can't sustain itself without government regulation. We desperately need socialism under a scheme of global governance. Quick, give up your sovereignty and pledge allegiance to the UN before we all die. The truth is that government over-regulation of a toxic kind had threatened the world's economy and those who were responsible for this outrage were self-righteously preaching to the rest of us that we were somehow the culprits and would now have to submit to their tyranny.

This is the time for conservative pundits to fly into action and defeat this insidious disinformation campaign. It is not new information that is needed, but someone must look at all the rubbish that is being written and start debunking it, because these government induced toxic loans are still ongoing. Right now the FHA has taken over the role of Fanny-Freddy in backing them and is starting to suggest that they too need a bailout. Nothing has changed. The actors are just shifting roles. We are not supposed to pull out of the crisis. It is just going to get worse — with "stimulus" money.

And that will be more evidence that the free market system "needs government control," quick, before anyone has time to study the issues and recognize what actually hit them.

With the mainstream media and America's — and Europe's — professional pseudo-intelligentsia working overtime to show that global capitalism has self-destructed and that the story of the big-bad CRA and of Fanny-Freddy being the fox in the hen house are all part of a vast right-wing conspiracy, it is no wonder that the entire world is tilting to the Left in its thinking on so-called capitalism. As BBC reports (not without a certain unmistakable Schadenfreude), almost a quarter of people surveyed throughout the entire world are now saying that capitalism is fatally flawed.

Yet when you look at these statistics, you see that Americans are among the least deceived. BBC states: "In only two countries, the US and Pakistan, did more than one in five people feel that capitalism works well as it stands."

I believe this is due to at least 3 phenomena:

1 — Americans are smarter than the rest, including the BBC, because they have the commons sense to support the free market,

2 — We have pundits like Rush, Savage, Farah, Beck and a whole slew of small but mighty web sites out there, like Laigle's Forum, unspinning the spin and setting people straight.

But there's also this I'm afraid:

2 — Many Americans haven't figured out that capitalism is no longer in place here. Many years ago they watched sanguinely as their government propped up a failing Chrysler, naively believing that the government was actually "saving" capitalism and the free market.

What was actually happening was that the stage was being set (BY BOTH PARTIES!) for Obama to come along decades later and deal the free market what was calculated to be its death blow.

There were other steps along the way to what is now being called alternately fascism, corporatism and even communism. Pick your — ism, but don't call it capitalism, because Adam Smith would not see his ideal embodied in what we call big business in the West today.

Afterword: A reader emailed me that it was good news that 3/4 of the world still believe in capitalism. But if you go to the BBC article linked above, you see that of the 3/4 who still have not given up on capitalism, the majority by far believe the propaganda. They choose the option that capitalism "Has problems that can be addressed through regulation and reform." A European Christian friend writes that neither capitalism nor communism are good — a conclusion that leaves socialism as the default system. If we lose this one, there will be no powerful conservative in the USA to say "tear down that wall."

For Christians who think socialism is part of Jesus' plan, please read the following article:

http://laiglesforum.com/2006/12/11/the-religious-left-in-bible-times-part-1/

© Donald Hank