ECONOMIC MELTDOWN?

The decision to bailout Wall Street is one which will have the critics pondering for years. As the basic question of should we or shouldn’t we looms, only strengthened by Monday’s failure by the House to pass the $700 billion bill, a verdict is yet to be reached on what the right thing to do is exactly. Should there be Congressional oversight? Should there be more regulation? Should executive pay be capped? To us, these questions all seem to be almost moot points.

Don’t get us wrong, we’re not against good legislation. What we are against is simply saying, “They (meaning mortgage bankers) are the ones that started the problem, let them stew in their own juices.” This mind-set has a significant flaw. It neglects the basic problem — the disintegration of not only the U.S. economy, but the world’s economy as well.

And if the “little guy on Main Street” wants the high falutin’ guys on Wall Street in their Gucci loafers, to “pay” for their bad decisions, he’d better start doing some serious thinking about what happens when his employer or his customers (in our case farmers) can no longer get the loans they need to keep their businesses operating.

Farmers in particular depend upon the availability of credit. They need operating cash to buy the equipment, fertilizers, seed and herbicides they desperately need in order to be farmers. They need credit to buy additional farmland which they may need to expand their operations, making them economically viable.

And companies likewise need credit to make capital investments to expand their businesses, add new machinery, update their information systems — i.e. money to keep their firms humming and competitive not only nationwide but worldwide.

All employees, no matter what industry, need a healthy and well-functioning equity and bond market to maintain retirement plans on which they’ve come to rely.

The collapse of the credit markets is unfathomable for businesses and for consumers.

We keep hearing politicians on both sides of the aisle saying that they need to protect the little guy from the “greed” on Wall Street. The only voices we hear saying they’re trying to do just that are those of Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke. Constantly they’re reminding lawmakers what will happen to world economies if someone doesn’t rescue investment firms and banks from past mistakes. And of course they say it’s imperative to do it quickly to avoid further problems.

Whether buying the risk is called “socialism” while at the same time leaving profits for Wall Street is described as “capitalism,” the terms simply do not matter at this point. What does matter is getting the U.S. economy on sound footing.

Most will agree with the fact that there were too many cheap or no interest loans that were given to individuals or companies that didn’t deserve them or took advantage of the system at the time. And this was the underlying problem for all of the current economic mess. Whether it was stupidity, ignorance, lax regulation, or whatever — general agreement on this is not what will solve the problem.

Many recent articles in The Wall Street Journal, Business Week and other business publication decry the demise of the capitalistic system as we know it. Just as many politicians who abhor regulations decry the call for any oversight on overzealous institutions seeking quick profits.

Pure capitalism, however, disappeared many years ago with the Great Depression of the 1930's. To this editor it seems to be, not the demise of capitalism, but a return to a more sensibility regulated economy where stable profits were the norm, not the “quick buck.”

While we can’t agree with Michael Douglas’ mythological Gordon Gekko in the 1987 movie, “Wall Street,” when he said “Greed is good,” we do believe that potential profits will continue to motivate farmers, businessmen and bankers toward a more satisfying and rewarding life.