by Elaine Grant

Created on: December 02, 2008   Last Updated: December 05, 2008

Commentary: Ideas to Solve the American Economic Crisis

These are, difficult treacherous times in America and for that matter all over the world. People are losing their jobs, savings, homes; going bankrupt and the whole structure of their lives is collapsing. The cause of this disaster is a tangled web of deceit and greed. It's like a massive tangle of string with loose ends hanging from it. The question is, which end do you pull that will unravel the mess. It is a huge conundrum.

At the present time, companies are reporting tremendous losses because people, consumers, are no longer spending money. Cash is tight. Credit is almost nonexistent, and credit cards maxed out. Most people are having trouble making ends meet with what little money they have. With no customers, loans from banks, and rising costs, businesses are forced to find ways to save their companies. How do they do this? They cut their payroll which, of course, is the people who spend money for goods and services. Consequently,these people are only able to use money on absolute necessities. We are dealing here with a "Catch 22". The USA Treasury has recently established an economic bailout plan of 700,000,000,000 dollars. (Note the number of zeros.) Sounds like a wonderful idea in essence. However, the problem is who should have access to vast amounts of money? Should the investment companies run by CEOs who were given excessive salaries and golden parachutes when the companies they were running were faultering. The reason, of course, was due to deceptive practices, lack of ethics by selling risky investments such as derivatives,which put their customers in financial danger.

Of course, these stocks paid large commissions and bonuses to the investment companies and their employees. So what did they care that they were not good investments for their customers? Their motivation was not a a well run company, but greed. Then how about the mortgage companies who had been giving adjustable loans on houses to people who could barely afford them? Real estate sales people were anxious to make these sales for the commissions they would receive, so they convinced their clients the future was bright and they would be able to the pay increased mortages when the time came. Everyone has dreams. It is an American dream to own a beautiful home in the suburbs. Sales people played on these dreams, not for the benefit of their clients, but once again, greed, with dreams of high commissions. Then when the cost of the

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