Financial Crisis: Unplugged

Have you ever wondered why its a financial crisis thats getting all the attention? When there was a bloody holocaust in Darfur in 2006, a racial cleansing in Somalia in 2004, an actual war in Eastern Europe between Russia and Georgia in 2008. We were briefly informed, only to care abstractly, and hold unfaithfully to an ideal of humanity. Countless crises have ravaged our country in times not so far gone and past, and as a nation we have acted only to the point of atypical, unresponsive concern for the people of the world. These are lives that we are talking about, not video game characters; not movie roles that end as soon as the credits roll. No, the only credits that roll for these people are the lines of their loved ones that add to the list carved into the rock that marks their families ancestral grave, unfilled with bodies as they have been mutilated and destroyed, but filled with the memory of pain, the untold stories that should have raised a world in an uprising, filled with the angry frustration that accompanies an uncontrollable situation. We watch maybe a newscast that touches on the subject, drowning our showers and sinks with unused, wasted water as we pity the people we hear about so absentmindedly, while the only water that wets their bodies is the rain that either falls from the heavens or falls from their eyes as they pity a world un-saveable.

But when there’s a financial crisis here on our territory, the world is turned upside down. This is not the way the world should be. Finances should not be the focus of our world, even though they are a very important part, they should not be the focal point. But if we must talk finances, let’s talk finances.
When financial pillars like AIG, Lehman Brothers, Meryl Lynch, and Washington Mutual are going bankrupt, it is clear that our country is in a crisis. There are many reasons that our economy is spiraling. The Consumer Price Index went up 5.4 percent one year ago, and 7.2 percent 3 months ago. This indicates that the cost of living has increased dramatically alongside this drastic inflation. Unemployment in our country, rose from 5.7 to 6.2 in August. With our economy already on the brink of a recession that can only end in a depression unlike our country has ever seen, the downfall of so many financial companies has brought a devastating effect. It was then that the government stepped in and announced that they were going to buy out AIG, a major American insurance company, named by Forbes in 2008 to be the 18th largest company in the world. Since AIG had suffered a liquidity crisis following the downgrade of its credit rating in the sock market, on the brink of bankruptcy, the Federal Reserve Bank bought them with loans of $85 billion (Bill Gates was worth $57 billion in 2008, just as a reference for the enormity of such a buyout loan). So the government, through the Federal Reserve Bank had saved the American financial system and pulled the economy back from the edge! Or had it…

Let’s look at this situation objectively. A company whose CEO received in one year a total of $41.5 million which included his salary, his annual bonuses, and a “one-time $24.5 million stock award,” has had decreasing credit ratings for a while and begins to show a thinness. The economy is at the perfect state to increase the vulnerability of this company. The governmental Federal Reserve Band, instead of letting the free-market take control, steps in and bails the company out, saving the economy from suffering in its loss and also putting a potential stop to obscene CEO spending and salary/bonus incentives. Sounds great, but remember the Federal Reserve Bank now owns a majority of the company and, in essence, control over its oversight. Coupled with the colossal $700 billion dollar buyout, which was a reaction to Washington Mutual’s failure on Friday, September 26, a buyout that will be a financial rescue plan, led by the Bush administration, to save the whole financial market as a whole. The plan being to send this enormous amount of money into the market by buying out different firms and have the money back in the hands of the market which will build the economy. But now the Federal Reserve Bank owns even more. The government is slowly buying out the entire financial market. The bases on which this country was founded, bases such as free-market and economic independence of the government, are very quickly fading into the realms of history and out of those of the future. If the economy crashes at the end of this recession and falls into a depression, the implications will be more effective than in 1929-1932.

But let us discern the actual facts for a moment; the facts that aren’t announced by the media moguls who control the media outlets that glorify the buying of so much financial power. The Federal Reserve Bank, started in 1913 by President Wilson as a central banking system of the United States government in response to financial panics similar to those of our day and as an enactment of the Federal Reserve Act, is supposed to have a “reserve” of worth to match the amount of bills or currency that the country has circulated. That is the Federal Reserve Note (a bill) system that we have been used to. The paper dollar is of no worth, but the fact that it “reserves” a certain amount of wealth from the Federal Reserve made it have worth. That is why we cannot simply print more money and feed it into the economy because if we were than the value of the dollar would be down, or it would be inflated. So when, for example, there are 100 gold pieces in the reserve and only 100 one-dollar bills being circulated, each dollar is worth one gold piece. But when more money is printed without an equal amount of wealth added to the reserve, than we have what is called inflation of the dollar value. So if we printed 30 more one-dollar bills and put no wealth in the reserve, than every dollar is only worth about 0.77 gold pieces. This seems scary to some who have never heard this before, but the actual fact of the matter is that our Federal Reserve has not been backing up our bills for a long, long time. Yet our dollar still has value. It has value because of faith and fear. And when finances are backed up by simply ideas, than the exchange of goods for bills is really just the exchange of an idea of wealth, an idea that does not exist outside the world of ideas. Faith in the dollar has allowed us to arrive to the point where our country’s credit is running short and we are needing to pull out our reserves and show for all the money we have printed, but all the wealth is not there to equal the bills by far. So as the Federal Reserve puts $700 billion into the financial market, where is that money coming from? The taxpayers of course, but is there actually that much wealth backing up the money that is promised, or is it simply the passing of an idea, of a number on a screen that now reads an account having more than before, a credit card swipe that subtracts numbers from numbers on a screen but does no real wealth exchange. With the multi trillion dollar debt that is hanging over this country’s head, the financial crisis is raping an America that has been unaware of its own danger for far too long.

I believe in the idea of an America that should have been, the same way I believe in a God even though I have no proof that I can show that He exists. The idea of faith is really all that matters, the same way that when you buy anything with a dollar you are handing the cashier a note to an amount reserved in the Federal Reserve but you are taking it on faith that there exists that amount. The time has come for us to grab this idea of America, not as it is with corruption and deception running rampant, and to actualize the idea of how America should have been. We the people can move ideas from the metaphysical to the physical; we can manifest an idea of America. The power lies in the mob, in the populous. The only reason I know this is the same reason I know that God exists, an opinion that is not proven: because there exists my faith the idea of true government and real representation—the ideals of this country’s founding—of which we should be taking part. If we were to mobilize as a mob to spark a change, we could overturn this idiocy that has ruled our lives for far too long. The words of change are not the words of complacent dis-action, but rather the words of movement, of awakening, of cohesion, of boycotting and protesting, and the words of revolution. A Social Reformation to revolutionize our country.

The financial crisis plagues our country as our world begins to fall apart. But even though I know there is corruption, even though I know this is not the way it should have been, I vote on principle—on the principle that participation is the way of government, and I WILL hold up my end of the honor code. Because IF I had the influence deserved to only the wise and experienced, IF this country’s people awoke all together, IF the people as a whole tore off the blindfolds that have comfortably covered their eyes and skewed their vision for so long, IF they were to listen to me even in my youth and see that even the philosopher who will one day be famous and remembered for all of time was at once a young man and, even though his philosophies did not change, the influence had to be gained before the people would listen to the same things, IF they saw that movement of all had the power of an unstoppable machine that could spark this government back into its original uses, IF there was a revolution of the people, I would need to be a participant in their ranks. So I vote for the principle of change, for the principle of sparking revolution—for the principle of Social Reform.