Like the vast majority of Americans I have no idea why the economy crumbles before our eyes. It has something to do with bundling mortgages though. Something to do with “securitization” and risky loans and “collateralized debt obligations” and stuff. Apparently cheap foreign capital looking for yields was involved.
If I had any clue what these explanations meant I’m sure they’d be incredibly useful. But to America and me an I-banker sounds like one of the dozen useless applications that cause my MacBook Pro to cost two grand. I thought the Lehman Brothers made a series of pornos featuring busty blonde twins. I wouldn’t know who Hank Paulson was if he walked into my dorm room dressed as the Monopoly Man holding a sign that said, “I’m Hank Paulson.”
Equity markets? Illiquid assets? T-bill rates? Whatever are you people talking about?
Although I’m probably in the minority here at Cornell, where soulless money-munchers are the majority. Cornell is less an institution of higher learning than a factory pumping out good capitalists, where even the English majors want to be rich lawyers. But the rest of America is right with me. To us this just seems like a hard gambling loss. In the pursuit of more and more stuff, cocky former AEM majors gave out cash to whoever wanted it so they could turn around and sell that debt for a little more than it’s worth. They traded a penny for a penny and a half over and over again, gambling billions of dollars that all the loan recipients would pay back eventually, despite no indication that these people had the means to do so. And now the loans are spent and the recipients are still broke, and those cocky AEM majors have no cash left and it looks like they lost their bet big time. This meltdown is by definition a gambling loss.
What does it say about America that gambling on sports is illegal because it jeopardizes the integrity of the game while uber-capitalists are bred at places like Cornell and encouraged to gamble away billions in cash? I can’t put five bucks on the Eagles game unless I’m in Nevada, but W. Rudolph Atwater can roll the dice for a few million dollars of someone else’s money and get a pat on the head for being a hard worker.
If I bet $8000 that the Patriots will beat the Dolphin and the Patriots lose I’ll be labeled an idiot, a degenerate, a sinful shmuck with a psychological addiction. But Mr. Atwater loses $8 billion and gets a pass because he throws these hallow words (illiquid, bundling, etc.) at us. Screw that. Hell I can explain to you why the Dolphins beat the Patriots after the fact but that doesn’t mean Caesar’s should give me my money back and I should be pitied. It’s gambling.
But America’s a tricky place. We afford great prestige to those who gamble on money while simultaneously preaching that the act of gambling is not only wrong but immoral.
I’m not going to discuss the morality of gambling here, but since compulsive gamblers are so often shat on by rich, self-obsessed financial creatures as irrational idiots, let’s see if Big Money has enough symptoms to be diagnosed with a pathological gambling disorder. The Pennsylvania Department of Health identifies a pathological gambler as meeting at least five of the following criteria:
(1) Is preoccupied with gambling
(2) Needs to gamble with increasing amounts of money in order to achieve the desired excitement
(3) Has repeated unsuccessful efforts to control, cut back, or stop gambling
(4) Is restless or irritable when attempting to cut down or stop gambling
(5) Gambles as a way of escaping from problems or of relieving a dysphoric mood (e.g., feelings of helplessness, guilt, anxiety, depression)
(6) After losing money gambling, often returns another day to get even (“chasing” one’s losses)
(7) Lies to family members, therapist, or others to conceal the extent of involvement with gambling
(8) Has committed illegal acts such as forgery, fraud, theft, or embezzlement to finance gambling
(9) Has jeopardized or lost a significant relationship, job, or educational or career opportunity because of gambling
(10) Relies on others to provide money to relieve a desperate financial situation caused by gambling
Let’s use Mr. Atwater to represent all of Big Money. Mr. Atwater is certainly preoccupied with gambling (he spent four years and over $100,000 learning how to gamble, and now spends nearly every hour of every day gambling). The more he gambles the more he needs to gamble with, as indicated by the exponential deterioration of this economy. Criterion No. 8 is perhaps the most relevant to Atwater, whose fraudulent dealings are part of the reason we’re here. That’s three down, if you’re counting. If you’re wondering if Mr. Atwater lied to anyone about his problem (No. 7) see the last two years of Bush, McCain and every other rich person telling us that’d we aren’t in a recession and the fundamentals of the economy are strong. And finally, to meet the fifth and deciding criteria, No. 10! Of course Mr. Atwater relies on a bailout! To the tune of hundreds of billions! Provided by the very people he commoditized and pillaged in the first place!
Essentially Mr. Atwater is no different from that dirty drunk guy at the end of the bar yelling at the TV, or the college kid found knifed to death by his bookie, or Keanu Reeves in ‘Hardball.’ They have the same medical disorder. But for reasons I can’t understand, he is pitied more than the rest, he gets a pass, he’s thrown a buoy while the rest of us are left to drown, lectured about our moral bankruptcy as we sink to the bottom.