The Back Alley Archives

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How did half of our nation’s population – the half that defines itself as conservative or moderate with conservative leanings – come to believe that it was ok to lie on a mortgage application? To put together thousands of loans into securities that were so complex that the printed documentation spanned thousands of pages? To sell a mortgage to a consumer knowing full well they could not pay. To sell a security out the front door to a customer, while shorting it in the next room?

How is it that our government has become so corrupt that Stanford Financial, now accused of a massive fraud spanning more than a decade, gave $250,000 to the Republican Senatorial Campaign – and nearly a million to the Democrats? Their lobbying successfully killed a bill that might have uncovered their alleged fraud years ago – in a Senate Committee. Partly as a consequence, over $8 billion in uninsured CDs held by Americans appears to have disappeared. Someone clearly got the best government money can buy, but it certainly wasn’t us.

How did Congress look the other way while our nation’s leaders – allegedly conservatives themselves - locked senators and representatives in a room one dark September night and predicted the end of the world unless Henry Paulson was given a blank check for $700 billion dollars that this nation did not have and would have to borrow?

We have descended the economic slope to where we are today because we, as Americans and conservatives, were willing to tolerate “just one little lie” in the pursuit of profit. As we have now seen, one little lie, repeated often enough, becomes one gigantic mess.

Private capital has fled our nation’s markets not only because of loss, but because of fraud, corruption and the willful blindness of our legislators and regulators. That capital, contrary to popular understanding, forms the foundation of our credit markets; fully 2/3rds of all lent and invested capital does not come from banks, but rather from private investors and sovereign funds. Our stock market has collapsed not because of economic recession but because that capital has retreated overseas or into the mattress where it cannot be stolen by those on Wall Street through their willing and complicit enablers in Washington DC.

Without that capital available to fund our economy, which government is incapable of replacing, we will experience a depression greater than the 1930s.

We have a challenge before us as a nation and as Conservatives in particular: to tell the truth, to once again stand for law and order, and to demand that “the bezzle”, or the undercurrent of fraud and deceit in our markets, be met not with a wink and a nod, but with indictment, prosecution and imprisonment.

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Our nation can get through this difficult time. We can rebuild our capital markets and restore the health of our finances, both as a nation and individually. To do so we must recognize that whether we are a government or an individual it is not possible to spend more than we make, that you cannot borrow your way to prosperity, and that we can only retain and grow our nation’s birthright as the bastion of capitalism so long as the rule of law triumphs over those who would lie, cheat and steal for a buck. May we find it within ourselves to put these principles into action, and restore America’s status as the world’s economic engine.