Top 25 People to Blame for the Economic Crisis

Why be prejudiced? Blame everybody. Gothic's got a good start on it with the capitalists, and even Time put the great American Consumer at #5. We all had a share in the greed and the "treat my home equity like an atm" syndrome. (Well, except for me--my pre-crisis home equity was a down payment on my new post-crisis home which is now worth about $30K less than we paid for it--so too late for me. )

Watching a TV show would actually be an example of consumption that doesnt use too many resources. On the marginal you only use electricity (which can be generated in fairly harmless ways). The whole digitalisation of society offers an opportunity to move from raw materials to energy consumption.

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Some math:

Average power consumed for common digital TV: 1.43 kWHr ( assuming power save mode while not turned on )
Average Time TV is on: 6 * 356 / hours

1.43 * 6 * 356 = 3054.48

x 3 billion people

9163.44 billion Kwhr per year

Kwhr produced by the world largest hydro power plant for renewable energy ( the three gourges ) 100 billion KWh per year

Need I say more ?

This does not include resource cost for producing transporting marketing selling, and wasting old TV's.

blatantninja said:

Umm, the banking collapse is due to far more than credit derivatives, but even so Clinton signed the Commodity Futures Modernization Act, which exempted credit-default swaps from regulation.

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Certainly. Clinton definitely bears his part of the responsibility for the crisis; I wasn't disputing that. I was taking issue with the hooey Unrestigered was spouting.

Low-income leads to low probability to repay. And where do you find that these aren't the loans going bad? The communities targeted by this act are getting hit awfully hard right now.

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The *communities,* for sure. The *loans,* not so much. Nowhere in the CRA does it say that banks should lend to people who can't afford to pay them back, nor that they should lend them more than they can bear -- and in fact the loans issued under the CRA are doing relatively well, compared to what else is out there.

Clinton also successfully pushed for Freddie and Fannie to start buying more and more risky mortgages.

I'm not blaming it all on Clinton by any means, but to say he had nothing to do with the current mess is patently dishonest.

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Which is why I'm not saying it. What I am taking issue with is the Clinton-made-Fannie-and-Freddie-make-bad-loans-and-that-collapsed-the-economy canard. I should bookmark my references because I clearly have to re-post them here often; if you like, I can dig them up from some other thread here. Ask dte, he probably remembers. Or I can come back later and post them; I don't feel up to it now.

GothicGothicness said:

Some math:

Average power consumed for common TV: 143 kWHr
Average Time TV is on: 6 * 356 / hours

143 * 6 * 356 = 305448

x 3 billion people

916344 billion Kwhr per year

Kwhr produced by the world largest hydro power plant for renewable energy ( the three gourges ) 100 billion KWh per year

Need I say more ?

This does not include resource cost for producing transporting marketing selling, and wasting old TV's.

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So, are you advocating that we all "turn Ted Kaczynski", growing our own food and crapping in our garden for fertilizer and living in a hut by candlelight? Can't say I like your vision much, even if we ignore the practical limitations of population density.

Prime Junta said:

Certainly. Clinton definitely bears his part of the responsibility for the crisis; I wasn't disputing that. I was taking issue with the hooey Unrestigered was spouting.



The *communities,* for sure. The *loans,* not so much. Nowhere in the CRA does it say that banks should lend to people who can't afford to pay them back, nor that they should lend them more than they can bear -- and in fact the loans issued under the CRA are doing relatively well, compared to what else is out there.



Which is why I'm not saying it. What I am taking issue with is the Clinton-made-Fannie-and-Freddie-make-bad-loans-and-that-collapsed-the-economy canard. I should bookmark my references because I clearly have to re-post them here often; if you like, I can dig them up from some other thread here. Ask dte, he probably remembers. Or I can come back later and post them; I don't feel up to it now.

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Sorry, misunderstood what you were saying on the first and third! That's what I get for coming in late to the discussion I guess!

On the second, I agree that technically the CRA doesn't say any of that, but we both know that the political pressure existed to offer more and more loans in those areas, and since this fueled rising prices, it meant reduced capacity to pay. Certainly the loans issued after 2000 are performing worse (larger amounts with relatively same income).

I'm going to jump in here and point the finger at a couple of groups not yet blamed.

The real culprits here are organized crime and the clergy! I'm not just being coy, either. To me this crisis is in large part an effect of too much gambling, once something that was generally considered a fault, and its acceptence in society, especially on Wall Street.

Society is in denial of some of the truths about gambling, the foremost one being that it confuses a lot of people who never seem to realize they're confused. It's the odds mostly. Some folks just don't get how to accurately predict chances. Then there's the results people get into denial over. And of course, there's the lies that are a result of that and work to confuse the entire issue.

There's a certain element of evil associated with gambling, one that manages to consistently fly under the radar. As a group, preachers preach against evil in all its conceivable iterations. But you never hear them preach against gambling. Why not? Because preachers who do tend to get hurt, and that's pretty much all there is to that.

There are two basic kinds of professional investors, ones who size up investments and ones who size up trends. The latter group is gambling. More than anyone else, those are the ones who got us into this mess, IMO.

Having said all that I want to comment that unregistered, whoever he is, obviously knows what he's talking about. In the world of home lending the words "Fannie Mae" used to be synonymous with conservative common-sense lending. Clinton changed that in a way that was later perverted and became a lot like gambling.

dteowner said:

So, are you advocating that we all "turn Ted Kaczynski", growing our own food and crapping in our garden for fertilizer and living in a hut by candlelight? Can't say I like your vision much, even if we ignore the practical limitations of population density.

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Not at all, much less is required of us. In fact very little is required to half an average persons (MA) consumption.

Take the car to go shopping when the store is in walking distance? don't
Keep TV on while eating or staying in another room? don't
Drive kids everywhere, when they could take bike or walk ? don't
Buying lots of unecesarry things you don't need? don't
Keep on lights when it is not necesarry or you are not in the room? don't
Keep on heat when you could wear more clothes? don't
Leave stuff in power save mode instead of powering off? don't
Use cloths dryer to dry clothes which would be just as dry hanging for a day or two? don't
Run the washing machine with just a few pair of clothes? don't

Watch a lot of TV or play computer games divide that time by two and spend talking togheter as a family go out jogging another even eco friendlier hobby than watching TV.

Take bike public transportation, or walk whenever you can instead of taking car.

Go to vacation on a location nearer to your home, that is almost as nice as going across the entire world.

All most people need to do to half their (MA) consumption is to think about not wasting needlessly, and a minimal change to their life style. A very small cost to pay to save our earth. Combined with a less optimistic idea than PJ's 10, 20, 30 years to half our (MA) consumption by technology, that's it, and people in developing countries could live better too.

@GG, is it me, or are you contradicting yourself big-time? A few posts up, you appeared to be wanting to ditch capitalism and invent a society that's not based on consumption; now you're just arguing that we need to make minor adjustments to our lifestyle in order to consume natural resources in a sustainable manner.

You once mentioned that there are actually two separate people posting under your handle. Is this the case this time?

It was the same person posting, my latest post was in a direct reply to what DTE said, and if you read these posts, you would get the connection?

For me capitalism ( at least the way it is now ) means the more stuff you have, the nicer car, the more exspensive and huge house, the more gadgets etc. The more successful you are.

The higher status in society you have, and if you have enough stuffs you could merry a twenty year old model when you are 60.

The more you consume, the better for the economy.

So, are you advocating that we all "turn Ted Kaczynski", growing our own food and crapping in our garden for fertilizer and living in a hut by candlelight? Can't say I like your vision much, even if we ignore the practical limitations of population density.

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I would like to suggest Social-Ecoalism instead, the more eco friendly you are without resorting to massive lowering of our standards, and instead of massive over consumption you give (some) of your extra to the people who need it so they could get a better status. ( For example by taxes, DTE you dislike me even more now right? ). Yes it is not realistic now. But at least in Sweden we have seen we are willing to pay more, for a product which has no other advantage over another product, if we know it helps the environment, if swedes could, it could be possible to change the mind of other people also?


the higher status in society. Living so eco friendly your wife might look like a 20 year old wife 20 years after you got married ( )

To reference Churchill, Capitalism is like Democracy. It's the absolutely worst economic system, except all of the others we've tried.

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Indeed, we evolve by finding new and better systems, just because it is the best we found so far does not mean we could not find a better system.

GothicGothicness said:

Take the car to go shopping when the store is in walking distance? don't
Keep TV on while eating or staying in another room? don't
Drive kids everywhere, when they could take bike or walk ? don't
Buying lots of unecesarry things you don't need? don't
Keep on lights when it is not necesarry or you are not in the room? don't
Keep on heat when you could wear more clothes? don't
Leave stuff in power save mode instead of powering off? don't
Use cloths dryer to dry clothes which would be just as dry hanging for a day or two? don't
Run the washing machine with just a few pair of clothes? don't

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Some of that stuff is doable on a large scale, some of it is not. For instance, large groups of people simply aren't going to hang dry clothes. It just ain't going to happen unless they have no other choice.

They key to being able to get people to consume less resources isn't taking away our conveniences, it's making our conveniences more resource efficient. Back to your clothesline again, that won't gain wide scale adoption, but a dryer that can dry a small batch of clothes and only use the energy required to do so but at the same time adjust when a large batch is in would.

Reminds me of the whole alternative energy car thing. Most people don't care if their car burns gas or hydrogen, runs off combustion or electricity, etc. They just want to have the car they want, with the options they want and not worry about being limited to a speed under the speed limit or a certain amount of distance (outside of refilling obviously). Build an alternative energy car (and the infrastructure to support it as necessary) that does all that and we'll ditch gas practically overnight.

Prime Junta said:

Certainly. Clinton definitely bears his part of the responsibility for the crisis; I wasn't disputing that. I was taking issue with the hooey Unrestigered was spouting.



The *communities,* for sure. The *loans,* not so much. Nowhere in the CRA does it say that banks should lend to people who can't afford to pay them back, nor that they should lend them more than they can bear -- and in fact the loans issued under the CRA are doing relatively well, compared to what else is out there.



Which is why I'm not saying it. What I am taking issue with is the Clinton-made-Fannie-and-Freddie-make-bad-loans-and-that-collapsed-the-economy canard. I should bookmark my references because I clearly have to re-post them here often; if you like, I can dig them up from some other thread here. Ask dte, he probably remembers. Or I can come back later and post them; I don't feel up to it now.

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The first step to recovery is recognizing you are an ideologue. We can have a link war, and no matter what proof is presented you will deny it. I think you are a true-believer, and you might think this is bunk but I worry for you. Once you pick a side and adhere to that side’s ideology blindly you’ll never be able to grow. You’ll never be a man until you learn its okay to stand alone when there is no one worth standing with. Believing one side is always wrong invalidates everyone who doesn’t think as you do, and it makes it easier and easier to turn a blind eye to the faults of your own. Everyone has to be held accountable, regardless of ideology.

The world will never move forward unless it moves forward together, and stops playing a zero-sum game. Until it values the diversity and richness of all the opinions and all the mindsets of its many people, it won’t go anywhere (unless one side manages to destroy all the opposition and force its mindset on everyone). There are no good guys, there are no bad guys, only different people with different opinions. What’s good for the goose is always good for the gander.

Unrestigered said:

The first step to recovery is recognizing you are an ideologue. We can have a link war, and no matter what proof is presented you will deny it. I think you are a true-believer, and you might think this is bunk but I worry for you.

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Good afternoon Mr. Kettle

GothicGothicness said:

It was the same person posting, my latest post was in a direct reply to what DTE said, and if you read these posts, you would get the connection?

For me capitalism ( at least the way it is now ) means the more stuff you have, the nicer car, the more exspensive and huge house, the more gadgets etc. The more successful you are.

The higher status in society you have, and if you have enough stuffs you could merry a twenty year old model when you are 60.

The more you consume, the better for the economy.

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No wonder I misunderstood you, then, because that's not the usual definition of capitalism. Normally what you're talking about is called "consumerism." The usual definition of capitalism is something like "an economic order where the means of production are privately owned."

I would like to suggest Social-Ecoalism instead, the more eco friendly you are without resorting to massive lowering of our standards, and instead of massive over consumption you give (some) of your extra to the people who need it so they could get a better status. ( For example by taxes, DTE you dislike me even more now right? ). Yes it is not realistic now. But at least in Sweden we have seen we are willing to pay more, for a product which has no other advantage over another product, if we know it helps the environment, if swedes could, it could be possible to change the mind of other people also?

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I don't actually dislike you, and I apologize for coming across that way. I am exasperated by you at times, though -- you appear to have a tendency to jump to conclusions and to make sweeping generalizations at the slightest provocation, which makes me want to break out the smiley a lot.

Unrestigered said:

The world will never move forward unless it moves forward together, and stops playing a zero-sum game. Until it values the diversity and richness of all the opinions and all the mindsets of its many people, it won’t go anywhere (unless one side manages to destroy all the opposition and force its mindset on everyone). There are no good guys, there are no bad guys, only different people with different opinions. What’s good for the goose is always good for the gander.

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Actually, no. You're not entitled to your own facts, and some opinions are and will always remain hooey. We should not accord equal time or attention to creationists, flat-earthers, moon mission conspiracy theorists, Holocaust deniers, believers in ancient astronauts, Scientologists, nor wingnuts. And there most definitely are some bad guys around.

Thank you, by the way, for demonstrating in your previous postings the way you value the diversity and richness of opinions that differ from your own.

Missed this earlier--British warpedness at it's finest.

Benedict said:

I blame this guy

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Yes, it's obvious once you think about it.

"He'd say, 'guys you don't wind up with 14 pins in your head and a chronic addiction to pain medicine by adhering to the standard banking model of using savers' deposits to fund prudent and responsible loans.

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No wonder I misunderstood you, then, because that's not the usual definition of capitalism. Normally what you're talking about is called "consumerism." The usual definition of capitalism is something like "an economic order where the means of production are privately owned."

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Indeed you are right, I am too fast in writing to take time to explain in more detail, which makes it very hard to follow the chain of my thoughts. What I described is the effects of pure capitalism rather than the system itself.

Let me say that I am for certain things being owned by gouverment, like in Sweden. For example if something is privetly owned, and the ultimate goal is to give money to the owners, why would they choose an environmental friendly way if it makes them earn less? But a gouverment owned company could operate to make it the best for the citizens and environment. Like public transportation for example, obviously it would work bad in other sectors...

Another problem not related to the environmnetal problem, is short term profit optimazation in the private sector. For example one person might move in earn as much money as possible, and move out, or generally think short term to earn as much as possible, instead of think eco friendly and long term. Look what happend in US ( the private sector could not handle it ) so gouverment had to step in and save these companies! ( hello ) isn't that another system?

Another example is land, if you owned a piece of land which had rain forest on it and cutting down that rain forest and plant sugar cane's instead would give you wealth but be bad for the future of the earth in a later generation, which option would most people choose?

don't actually dislike you, and I apologize for coming across that way. I am exasperated by you at times, though -- you appear to have a tendency to jump to conclusions and to make sweeping generalizations at the slightest provocation, which makes me want to break out the smiley a lot.

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I know you do not, and I enjoy grealy to get a sharp remark or be met with sarcasm ( Please do go on! ) if I wrote something that I didn't think through. It only ( hopefully ) makes me focus more and explain in more detail next time.

I do not think our thoughts are that far from each other in most question as it would appear after we both layed out all of our points we would end up not too far from each others opinions.

GothicGothicness said:

Some math:

Average power consumed for common digital TV: 1.43 kWHr ( assuming power save mode while not turned on )
Average Time TV is on: 6 * 356 / hours

1.43 * 6 * 356 = 3054.48

x 3 billion people

9163.44 billion Kwhr per year

Kwhr produced by the world largest hydro power plant for renewable energy ( the three gourges ) 100 billion KWh per year .

Click to expand...

If you want to do maths, do meaningful and intellectually honest maths instead rather than tabloid style scaremongering...

I'm not out to defend the couch potato lifestyle, but your numbers (for TV power consumption) are off and the comparison with the Three Gorges is an irrelevant one whose only purpose is intimidation. The relevant comparison is to other forms of consumption on a per individual basis, not lumping together ther whole worlds consumption and get a scaremongering number. A more relevant comparison would be that a 15-20 minute drive to the bookstore will use up more energy than many hours of TV watching. I also note that you didnt comment the music example.

I agree with your more nuanced later post that we should consume smarter (for instance we should find better alternatives to driving when possible) and find more sustainable solutions, but that is not a point against capitalism per se which you stated initially. It is not even an argument against consumption per se, but for optimisation.

What irked me was the whole assumption that growth and increased consumption automatically uses more raw materials than the lack of the two that you tried to make earlier. This is simply false as it:

a) assumes raw materials are the main inputs
b) doesnt take optimisation and improved efficiency into account at all

But I feel that it is a common assumption with roots in a hodgepodge mixture of romantic environmentalism and 19th century marxist ideas of how production and economics work I get very tired of the Luddite prophets of doom that pop up every time there is a crisis and suggest we go back to a stone age lifestyle...

GothicGothicness said:

Let me say that I am for certain things being owned by gouverment, like in Sweden. For example if something is privetly owned, and the ultimate goal is to give money to the owners, why would they choose an environmental friendly way if it makes them earn less? But a gouverment owned company could operate to make it the best for the citizens and environment. Like public transportation for example, obviously it would work bad in other sectors...

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Having worked in the public sector I can assure you this is a somewhat naive assumption (not that the private sector is better). What we need to do is to create sound incentives to do the right thing. For instance we could tax the crap out of energy consumption if we want them to save energy. This works for private consumers too. It isnt so much environmental concerns that make people look for more environmental friendly cars and low energy lights, but hikes in petrol and electricity prices. If going environmental friendly coincides with saving money we kill two birds with one stone...

I get very tired of the Luddite prophets of doom that pop up every time there is a crisis and suggest we go back to a stone age lifestyle...

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It is obviously not what I was suggesting?

If you want to do maths, do meaningful and intellectually honest maths instead rather than tabloid style scaremongering...

I'm not out to defend the couch potato lifestyle, but your numbers (for TV power consumption) are off and the comparison with the Three Gorges is an irrelevant one whose only purpose is intimidation. The relevant comparison is to other forms of consumption on a per individual basis, not lumping together ther whole worlds consumption and get a scaremongering number. A more relevant comparison would be that a 15-20 minute drive to the bookstore will use up more energy than many hours of TV watching. I also note that you didnt comment the music example.

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The offered alternative was to tell each other stories??? so instead of producing 9163.44 billion Kwhr per year it would go to zero, I just wanted to show it would be a significant saving of resources. Besides for me I always enjoyed a well told story over watching "dumbing down" TV

a) assumes raw materials are the main inputs
b) doesnt take optimisation and improved efficiency into account at all

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a) As described in the post it is very few things which we consume that is not ( in some way ) related to raw materials? For example what you said about power is simply wrong, we might get to all power sources being renewable energy, but right now a large part is produced by Coal power plants, which is one of the worst things you could throw at the environment.

b) If you read the post I was taking effiency into account. I was also taking into account that other people in other parts wants the same standard as us.

Having worked in the public sector I can assure you this is a somewhat naive assumption (not that the private sector is better). What we need to do is to create sound incentives to do the right thing. For instance we could tax the crap out of energy consumption if we want them to save energy. This works for private consumers too. It isnt so much environmental concerns that make people look for more environmental friendly cars and low energy lights, but hikes in petrol and electricity prices. If going environmental friendly coincides with saving money we kill two birds with one stone...

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Which part of the private sector did you work? It makes us politicans sad to hear this, yes we want the gouverment owned companies to turn a profit if possible. But profit should be second to providing service to the citizens and preserving the environment.

GothicGothicness said:

Indeed you are right, I am too fast in writing to take time to explain in more detail, which makes it very hard to follow the chain of my thoughts. What I described is the effects of pure capitalism rather than the system itself.

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Why do you think consumerism is a necessary consequence of pure capitalism (whatever that may be?) Let me remind you that the closest we've gotten to "pure" capitalism -- i.e., unfettered markets, minimal public sector involvement etc. -- is 19th century industrial capitalism, which was not about consumerism at all. The vast majority of the population lived at or near the subsistence level; they didn't have any extra money to *use* for consumption, even if they wanted to, and the bourgeoisie measured their worth by what they owned, not by what they consumed.

Let me say that I am for certain things being owned by gouverment, like in Sweden. For example if something is privetly owned, and the ultimate goal is to give money to the owners, why would they choose an environmental friendly way if it makes them earn less? But a gouverment owned company could operate to make it the best for the citizens and environment. Like public transportation for example, obviously it would work bad in other sectors...

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Sure, sure -- some things *are* best off in government control, and privatization efforts have often gone terribly wrong. (British Rail, anyone?) But that doesn't mean that private enterprise is *necessarily* worse than government run operations (nor vice versa). The worst environmental disasters in history have been done by government-run organizations -- Norilsk Nickel, Chernobyl, that Three Gorges dam, Aswan, what have you. As Zaleukos says, it's about incentives, and they apply equally well in government-run operations as private-sector ones.

Another problem not related to the environmnetal problem, is short term profit optimazation in the private sector. For example one person might move in earn as much money as possible, and move out, or generally think short term to earn as much as possible, instead of think eco friendly and long term. Look what happend in US ( the private sector could not handle it ) so gouverment had to step in and save these companies! ( hello ) isn't that another system?

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Absolutely. As I've pointed out on these threads several times, we have to find some way of properly pricing in externalities and long-term consequences; if business is driven by opportunistic investors looking for short-term gains, who are willing and able to shift their capital at the drop of a hat, it'll never work. I liked the ideas about binding voting rights to the time an investor has held her stake, for example.

But that doesn't mean that capitalism -- or the market -- itself is at fault. Lots of alternatives to the market have been tried, and they've all worked out worse. I believe that the market is a fine servant but a poor master, and we have to figure out ways to make it work for us rather than the other way around.

Another example is land, if you owned a piece of land which had rain forest on it and cutting down that rain forest and plant sugar cane's instead would give you wealth but be bad for the future of the earth in a later generation, which option would most people choose?

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That would depend on whether the externalities and long-term costs are correctly priced in.

The vast majority of the population lived at or near the subsistence level; they didn't have any extra money to *use* for consumption, even if they wanted to, and the bourgeoisie measured their worth by what they owned, not by what they consumed.

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Owning as many things as possible is also a way of consuming, if I buy 100 pair of wrist watches I do not need, it needs material and power to produce them, and probably I would just throw them away later, not all parts could be recycled and even the parts that could be recycled would cost power and resources to recycle them. Private persons who own a lot, will use what they own to consume in different ways, and if a private person do not consume, the wheels of the capitalism system comes to a stop as we have seen??? so society is now trying to make people to start spending again to get the wheels spinning ? Yes we could think as you are, we have to consume now so the system can start spinning and we could by research make it possible to keep consuming without our earth going under. Did I get your right on that??? that is how I understood your writing.

I think we have to think, right now we do not have the natural resources required to live in the way we are doing, and nothing guarantee that we would be able to in the future by reserach, so we have to find a way to consume less than we are now. If we indeed spend more and the system starts spinning, the CO2 emmitants will go up steadingly, we might make environmnetal breakthroughs to make it possible to consume that much, but until we are there ( and in my opinion that's far off ) we had better change our way of thinking! Even if it is like you said that the people in europe just need to half their Eco footprint, we have more than 4x the amount of people who want to increase their level to the same as us. How can we tell them? sorry our earth might be destoryed so you cannot live as the same standard as we do since you are too many ?

As Zaleukos says, it's about incentives, and they apply equally well in government-run operations as private-sector ones.

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If we raise the tax on gas, and the companies is out to earn money, they will find another less obvious way ( producing ethanol from corn, which is worse than driving on gas for example ) which destorys the environment, since their goal is to earn money to benefit the private person ( the individual ), not to preserve the environment.

I think you will argue that the fault is that the tax is on gas, rather CO2 emmitans? but another thing like cutting down the rain forest to produce sugar cane's you cannot directly say it is CO2 emmitans, but it still has a great affect.