The Bush administration urged Congress in 2008 to bail out the Wall Street Financial Industry to the tune of $700 billion. Congress did so with legislation. The Financial Industry was the major cause of the economic collapse which has been described as the worst since the great depression. Subprime mortgage loans has been described as the main reason and cause. Many Wall Street Financial giants participated in the subprime mortgage market.
The words, "Too Big To Fail" were used to justify the bail outs but little attention has been paid to accurately indentify what those words truly indicate and how they relate to what took place and why. If indeed a business is "Too Big To Fail" it indicates that business is a monopoly and a threat to the free market system, to competition, to the economic well being of the country and a threat to other business establishments. The U.S. has anti trust laws to prevent business monopolies and are supposed to prevent and break up such threats to America's well being.
Now after the fact and the damage has already been done some Democrats are calling for the break up of those large Financial Institutions. That action should be expedited by Congress, monopolies should be broken up and from this day forward the regulatory authorities should scrutinize all future company mergers and take overs to make sure another monopoly is not created.
Monopolies are anti American and anti business in nature because they represent power and wealth. Those two combinations in the hands of ruthless people are deadly for the people and country. Power and wealth gives monopolies the feeling of being invincible and above the law and thereby do as they please. All the while their CEO's continue to acquire more power and wealth and are continuing to do so as of this writing, while the people and the country are still paying the price for their monopolistic failures.
Just yesterday the Security and Exchange Commission accused Goldman Sachs and Co., of defrauding investors by failing to disclose conflicts of interest in mortgage investments it sold as the housing market was collapsing. This concerns subprime mortgage securities sold to other investors. (Taken from report in Times Picayune of 4/17/10) Power and wealth was at the center of what Goldman Sachs were involved in. Don't any one be surprised if the SEC implicates other Wall Street financial firms.
Corporate America has proven over and over, again and again they can not and will not regulate themselves or their behavior. It really falls to the federal regulators to do the job and be vigilant. The same Corporate America rails against regulation and big government but they are the reason why we have both. For over two years, politidose has been commenting how power and wealth in the wrong hands has been a deadly combination for the country and its people. It has now come full circle.
Monopoly is the correct word to describe, "Too Big To Fail" and the Obama administration and Congress should pass legislation to not only break them up but also make sure there are regulations in place where it will prevent monopolies to take hold again.
