Why did the insurance giant AIG fail?
The average observer would say that AIG was a big, capitalist insurance company that got in over its head.
Which is true. But the reason that happened is that the financial wizard who founded the company and ran it well for many years was forced from his post in 2005.
Who forced him out?
Eliot Spitzer did, the former governor of New York State who resigned in February in a prostitution scandal.
Before Spitzer was elected governor in November 2006, he was the state attorney general for 8 years. And Spitzer is a hard, crusading leftist who abused his post to pursue, harass, intimidate and prosecute private-sector businesses all over the state, especially Wall Street and New York City financial firms.
His tactics were well known to have targeted and hurt many good and honest people, which is a tactic of leftists everywhere, just as many in the media are trying to destroy Sarah Palin simply because they don’t like her.
One of Spitzer’s targets was AIG founder and CEO Maurice “Hank” Greenberg who was forced from his post as a result of Spitzer’s prosecution only to be exonerated after this action by Spitzer was seen for what is really was: An anti-capitalist witch hunt.
This happened many times over with Spitzer.
In fact this entire housing collapse is overwhelmingly due to the influence on our economy of socialism and people like Spitzer.
For instance, who would say that our universities, public schools, news media, entertainment industry, the arts etc. are the quality they were 50 years ago?
No honest person would.
So why is business any different? Go into any business institution today from your local bank to any major American corporation and you will often find Democrat/liberal presence and influence, sometimes heavy influence. It may not appear so on the surface, but it’s there. Often it is very subtle and sneaky.
Today, if you said you were a proud “conservative banker” operating on old-fashioned principles, you would be tarred with a big, nasty brush. Because to the media, the very word “conservative” is an epithet, even though it is the way banks stay in business – by being cautious in their lending practices.
Today, banking is politically-correct, liberal, feminist, postmodernist, metrosexual etc. And one of the mantras of these liberals today is that you loan money to whoever needs it according to socialist theory, that that is the “responsible” thing to do. No money down, no documentation on your income or your ability to repay.
Wall Street has many, many liberals and leftists in its ranks. Don’t ever believe otherwise. The former chairman of Goldman Sachs is far-left New Jersey governor John Corzine.
Then the government comes along and says banks must lend money to poor people, that you can’t “redline” certain neighborhoods. Those poor people, of course, would not ordinarily qualify for loans, but the modern, politically-correct banker says that that is not germane, just as the ‘new math’ says two plus two is whatever you think.
Then the government establishes secondary mortgage market agencies that will buy the loans that you made to the poor people, and will guarantee them. Then Democrats like Franklin Raines take over as CEO of one of those agencies, Fannie Mae, cooks the books, retires with more than $50 million, watches Fannie Mae drown, and joins Barack Obama’s campaign.
By the way, Fannie Mae and Freddie Mac are just welfare organizations disguised as mortgage agencies.
The fact is that capitalism needs to be and should be regulated. What has shredded our productive capitalist system is constant and intentional attacks by people like Spitzer, cronyism by Clintonites like Raines, the watering down of our financial system by leftist infiltration and government intervention, and government mandates to lend to anyone who wants money.
This last factor – easy credit – is a hallmark of socialist theory. And when “conservative bankers” try to stop it, they will be harassed by figures like Spitzer or required by the government to make loans they know cannot be repaid. Then when they make the loans, they pawn them off on the same government agencies that forced them to make the loans in the first place.
This is the real heart of the current economic crisis.
Please visit my website at www.nikitas3.com for more common sense.