THE DEPRESSION OF 2008

STAFF, BUSINESSWEEK, (2009) 3/9/ 22-24/John Delaney (2018) THE RIGHT ANSWER, (New York,New York: Henry Holt)225 pages.

The major cause of the Big Depression of 2008 was the mismanagement of the major banks in the USA. Glass-Stiegel was terminated so that banks lost a major wall. Money used for investment was blocked until Reagan opened the wall with money used for savings. Therefore, the banks became free to spend recklessly. Lehman Brothers was first to go.

As the country of the USA fell, this had a strong impact on the rest of the world. As this happened, the federal government of our country invested billions of tax dollars into propping up the big banks. The major message is the massive de-regulation sent a message to the rich. You can make many questionable loans and if they fall, the feds will back you up.

Therefore, most banks in the rest of the first world are nationalized to avoid the risk of privatization. It also pays salaries to heads of banks overseas and here the CEO’s receive a percentage of growth. Thus, they become unusually rich.

In the USA, 20 % of the population owns nearly all the means of production (property that makes money) and the bottom 80% support the system. The income tax spread on a chart appears that the rich pay all the taxes. Nope. They have all the property. Further, on a wealth chart which is rarely seen they pay very little on capital gains. Further, there are giant loop holes so that the richest man in America, Jeff Bezos doesn’t pay any income tax. Amazon has not paid any taxes for the last two years.

So tax the rich, grow the middle class, and make the structural poor (who are poor in any business cycle) go to work for states or feds.

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