David in D

Don’t Blame Wall Street - At Least Not Completely

Pretzel Logic - Yeah, I said "Reaganomics has now been discredited" and I'll stand by that. Perhaps I need to nuance it a bit but without a doubt the doctrine that prosperity would "trickle down" and tax cuts for the wealthiest portion of America really benefit the general public is now in the trash heap. This isn't partisan politicing - I actually think Reagan did some great things - but the mythos that he helped normal working-class people such as myself is clearly false.

My comment about the 60's and 70's was (admittedly) not specific enough. What I meant is to say is that middle class wages, as compared with the wealthiest crust of America, were actually much closer than what we have today. Clearly we have a widening wealth gap now and a squeezed middle class and ABSOLUTELY Reagan's notion of a tax cut for all and huge deficit spending was the start of our disaster today. (And by the way, for everyone who want to assert that "defense spending in the 80's brought down communism" and thus were justified deficits, I suggest you look at the correlation btw oil prices and fall of the Soviet Union. Many Soviet economist, post-fall, cite that as the main actual internal problem for the USSR - not Reagan's antics.)

But I digress, instead or Reaganomics, we need a progressive tax code the lessens taxes for the middle class, holds upper middle-class taxes steady, and raises taxes on the wealthiest couple of percent of America. We should provide targeted incentives for job creation, but a tax cut for the wealthy and job creation are not directly (or at least efficiently) linked.

To repeat, trickle-down economics has been discredited along with the Bush tax cuts. I'd be interested to hear other thoughts on this along with Pretzel's comments.

Don’t Blame Wall Street - At Least Not Completely

Markos, I'm feeling a little bad for you since so many are hoping on your back (me being one of them earlier). So, I'll back off and reiterate that I agree with you that nearly everybody is guilty in some way with this disaster. I also appreciate that you are taking a contrarian view and pointing out that Wall St. shouldn't be the only whipping boys.

Here's where I think your article is nuts. To claim that Wall St. is responsible for America's prosperity because the guy "working at Wal-Mart" can "buy a car" misses the point. If lending didn't exist in its current form other possibilities would exist for transportation or other products (such as the scooter I ride to work) would be more popular and people would generally save money for what they absolutely needed (or they would ride the bus).

The problem IS precisely that people - encouraged by Wall St banks - spent more than they could afford and assets rose to meet that false demand. Yes the borrower is guilty of having a bigger appetite than his Wal-Mart wage could sustain, but the tax payer surely should not bail out the banker who made the loan to a person who couldn't repay it. The borrower and the bank should go bankrupt and this is exactly what many people such as myself are saying when we say "you are out of touch with mainstreet." We don't want to pay for other's bad mistakes and I don't think Armaggedon is going to descend on us if we don't bail out the banks... tough times for a while... but not disaster. My daughter (who is now 3) is not going to be paying for this bailout if I have anything to say about it.

Don’t Blame Wall Street - At Least Not Completely

Markos- Really, come on man, are you serious? Without a doubt, most Americans hold some of the blame; and there is certainly enough blame to go around in terms of government, the Bush Administration, ratings agencies, and Wall St. But do you really think the difference between America and the developing world is Wall Street? You have been in Manhattan too long.

Here's the truth. America was the great economic superpower it was because of the middle-class. Hard working, smart, dependable people who put great ingenuity to play for the whole world. Our greatest days were the 1960-70's when the middle-class got a fair shake and when the difference between the wealthiest crust of America was closer to the median American worker. That is what built America's economic prosperity.

Now that Reaganomics has been discredited, the Bush Administration is found lacking in all areas, and Wall Street's own inventions have imploded we would best use our energies figuring out how to reward the middle 90% of America.

Seriously though, you have to get a grip and go live a while with normal people!