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Northwest Voices

Seattle Times letters to the editor

November 20, 2008 at 3:35 PM

The national economy

Tonight’s main attraction: greed

As California governor, Former President Ronald Reagan gave tax breaks to the very rich while raising the taxes on the middle class and made government lean by getting rid of such “unnecessary” expenses as taking care of the mentally ill, veterans included, thereby putting them on the streets of L.A. and other cities.

He gave little or no raises to state employees, warred with unions and stripped away regulations that were onerous to business, producing a situation in which corporations were unfettered and allowed to make up their own rules as to how businesses would run, without outside interference, setting in motion the start of a period of increasing greed.

Government was the problem, Reagan said, not the solution. Voters did not seem to be aware of Reagan’s blatant attack to bankrupt the middle class. Then he became president and the stage was set for more of the same.

Is it any wonder that, with rules and regulations going by the wayside, corporations began giving huge bonuses and golden parachutes to top managers? Cheating had resulted in great profits.

To further increase the value of shares of company stock, unique accounting methods were employed.

Jane Bryant Quinn, well-known economist and financial adviser, warned that 40 percent of the S&P 500 used pro-forma accounting, such as Enron fraudulently used. The Enron implosion caused many corporations to restate their financial reports, with the SEC [Securities and Exchange Commission] monitoring the changes. Prison time ensued in several well-publicized cases.

All of the above showed financial institutions that they could increase share value by using shady tricks, although Former Federal Reserve Chairman Alan Greenspan recently said he thought they would be more “disciplined,” not realizing greed was the headline attraction.

The economic disaster that we were finally made aware of came after Vice President Dick Cheney talked to furious Republicans and when Federal Reserve Chairman Ben Bernanke and Treasury Secretary Hank Paulson laid out their case for an immediate $700 billion before stunned congressional leaders.

One stated the message was to do this immediately or watch a world economic meltdown. Russian President Vladimir Putin later said the U.S. put the world at great economic risk by selling poison-pill securities to world governments, such as China, Great Britain, etc.

$700 billion is just a drop in the bucket to the real cost.

Thanks Ronnie.

— Max Don, Mukilteo

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