Exploiting Poverty Caused The Financial Crisis

Sure, the CEOs and hedge fund managers were greedy. There's no question that wealth and the pursuit thereof led to the sub-prime fiasco and the decline of Lehman Brothers, AIG, Merrill Lynch and now the global tailspin. But what's really at play here is persistent poverty and Wall Street seeking to make a dime off the poor, consequences be damned, while Washington looks the other way.

The sub-prime crisis is the result of good people getting bad loans. Loans that triple or quadruple in interest rates, riddled with small print, are unbearable by most homeowners. But they are particularly unsustainable for low-income families working two or three jobs to make ends meet. Still, lenders scammed hardworking families with the promise of owning homes they really couldn't afford. And then greedy Wall Street managers, looking for a new way to squeeze a buck from an already bursting-at-the-seams economy, bundled up these bad loans into worse securities, sold them off, and tried to gain a profit as our national economy lost its shirt.

We could have averted the current financial crisis by creating affordable housing and good jobs, strengthening public education and providing health care and child care for all families, to help hardworking Americans thrive in the middle class instead of being pushed into poverty. We could have averted this crisis if we really cared about all families owning their own homes and created nationwide programs including affordable loans. (Even subsidized loans in the first place would have cost taxpayers less than what we're now spending bailing out Wall Street.) We could have averted this crisis if we put the needs of the majority of American families ahead of the needs of a small minority of greedy investors.

Now, 8,000 American families a day face foreclosure. But instead of prioritizing poor and even middle class families who are increasingly struggling, our government is spending billions and billions to bail out the Wall Street firms that created this crisis. Instead, we should be spending our taxpayer money to help the families who were taken advantage of in the "anything goes" unregulated financial system that years of misguided never-really-did-trickle-down economic policy created. These families need the government to help re-adjust their mortgages and cover bridge payments to avoid foreclosure.

The fundamentals of our economy are not sound. Real wages for the majority of American families have been declining while CEO salaries are at an all-time high. Health care costs and college tuition are crippling more and more families. The middle class is rapidly disappearing, and more and more of us find ourselves struggling while the gap between the rich and poor grows.

Instead of allowing Wall Street to profit off of poverty, we should fix our economy once and for all, to work better for all of us. We need universal health care, including a government-funded insurance option, to help families get out from under mounting health care debt. We need policies that reign in scam lending, from housing to the credit card industry. We need a nationwide living wage and a massive public jobs program, to address underemployment in our unstable economy while helping build essential shared infrastructure like public transportation and schools. We need new trade and immigration policies that work for working people on both sides to the border. And we need new corporate rules of the game that make big business accountable to communities and workers, not just greedy investors.

Wall Street and conservative economists have insisted that, in our laissez faire system, everyone is on their own. The poor were left on their own, to fend for themselves against twisted economic structures backed by the biggest institutions on Wall Street. Washington never left Wall Street on its own, and as Wall Street's scam deflates, Washington is coming to the rescue. But shoring up Wall Street won't make our economy work. We need to ensure that a greedy few can't exploit those who are struggling. Without poor people, this crisis would have never happened. If we prioritize ending poverty, and preventing more and more Americans from slipping into poverty, we can be sure it won't happen again.

Comments

[lavictoria]

ummm 98 % of all people still pay their bills... its the people who lived beyond their means who exploited the banks by not paying back a loan

[lavictoria]

EXPLOITING THE POOR????? are you kidding???? where is personal responsibility???? they knew what they were getting into.. my parents taught me to never live beyond my needs... and by the way the people who were working in finance payed 86% of all taxes anyway because they were in the top income bracket as opposed to the poor who dont pay any... so really the finance people are bailing the banks out .. its the liberals who caused this by exploiting the poor and making banks take on these worthless loans... so open your eyes

[jhNY]

"We need to ensure that a greedy few can't exploit those who are struggling. "

Pardon my guffaw. The entirity of what passes for the 'theory' of capitialism is the exploitation of the uninformed, the gullible, the vulnerable. Don't believe it? Watch television during the commercial breaks. Ads are largely aimed at the very young, who naturally have not yet had time to resist the persuasions of advertisers, the very old , who have lost a step, and young unmarrieds, who have the most money by percent to spend impulsively, who are least likely to save and plan and most likely to be persuaded to purchase things which they can be convinced will make them more attractive. Every product is aimed at a consumer, who through careful and expensive focus group testing, has been found to be persuadable and exploitable by the pitch of the advertiser. What's the best car to drive? Not the one the ads tout-- the best one needs very little advertising.

Capitalism is a con game and con games require rubes. Take the rube out of the picture and you take away the system.

[LeftRight]

My question is, how is it that corporations can be so stupid??? The only time that the economy in America has ever been really strong (and more than a dozen people were REALLY rich!) was when we had a middle class. And yet they've lobbied for more and more policies and laws which OBVIOUSLY reduce the middle class to NOTHING!! And then what happens to your precious corporation? The CEO is rich, while everyone else (including the board, CFO, and other leaders) are struggling!

[tompoe]

"We need to ensure that a greedy few can't exploit those who are struggling. "

Not sure where you got the idea there's only a greedy few. Every employee in the financial sector had their eyes wide open when they sought a career opportunity. How many working in the financial sector were unaware they were contributing to the exploitation of the poor? How many were unaware they were living the good life at the expense of the low-income population?

So, how many, today, think it's a good idea to shift the burden of the crisis to the poor by not slapping a moratorium on the foreclosures? Why, of course, everyone still remaining in the financial sector. Whatever this corporate welfare crap is that is going on, today, it sure isn't about a greedy few. It's about a whole lot of more of the same at the expense of the poor.

Where's the moratorium on the foreclosures?