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Posted: August 19, 2009 12:00 a.m.

Lesson learned? Maybe not...

Many of us could do better at living within our means.

But, your editorial "Lessons in Credit" illustrates another shortcoming in America today - the need to oversimplify complex situations and cast blame without pausing to look in the mirror. You broadly blamed our economic woes on government and individual borrowers, while turning a blind eye to those most guilty.

The global credit crisis that triggered a world recession started with banks lending money to persons who could not pay it back. But, it was an incredible chain of greed and irresponsibility that led to global collapse. You seem to hold blameless mortgage brokers making loans they knew were bad, banks packaging and selling toxic mortgages, Wall Street wizards who pooled bad loans into mortgage-backed securities and derivatives with manipulated ratings they sold to investors, and those who hid the pending crisis through creative accounting. These players knew the house of cards would tumble, but cashed in before the fall. Yet, you label the individual borrowers "greedy and careless people"?

It is a nostalgic, but misplaced notion to suggest all will be right in America when individuals on the lowest rungs of the economic ladder accept their station in life and save for the American Dream. But, the corporate America that created mortgage-backed securities and derivatives markets through government deregulation is the same corporate America bombarding those who have the least with relentless pitches urging them to borrow and buy in an endless cycle of conspicuous consumption. Yet, before we paint Wall Street as the villain, remember we are Wall Street. With over 50 percent of American households investing in the stock market, we demand unrealistic returns from corporations because it is we who have not saved, not just the minimum wage family seeking home ownership. We chase the best return, never asking if rising values are driven by honest profits or by fraud and deceit. In a shell game, someone is always left holding the bag; we only complain when it's us.

You argue against government involvement in other industries, while holding government accountable for having "allowed banks to open the floodgates of credit to all people." You say a free market system serves America best, yet you ignore the undeniable role of that free market in nearly ruining the world's economy. I have no problem with preaching personal responsibility and living within means. But, ignoring broader lessons in a world where greed is always seeking a fresh angle shows some have learned no lesson at all. There are no easy answers.

Editorials that gloss over glaring truths and grossly oversimplify solutions are not the pathway to a better tomorrow.


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