Letters to the editor
Bernanke’s reconfirmation a mistake
In these times of economic hardship and uncertainty, many people have become increasingly aware of an inconspicuous institution known as the Federal Reserve. Despite the recent attention the Fed has been receiving, most people still have little or no understanding of what the Fed does or how it affects our daily lives. This is an enormous cause for concern due to the controversy surrounding the re-nomination of Federal Reserve Chairman Ben Bernanke.
Today the media touts Bernanke as a modern day hero who, in the face of adversity, took drastic measures to stave off the worst economic crisis since the Great Depression. This belief, however, is not only unfounded but is also lacking comprehension of fundamental economics.
In the wake of the crisis that unfolded in late 2008, Bernanke cut interest rates to near zero and flooded the market with trillions of dollars in easy money all in the name of helping out struggling companies and debtors. These actions, much to our dismay, are the exact measures enacted by former Reserve Chairman Alan Greenspan during the stock market crash in the early 2000s. The only difference is that Bernanke committed these fallacies on a much larger scale; at least Greenspan kept interest rates near 1 percent.
The result of Greenspan’s actions, as we all know, was the housing crisis that led to many of America’s top financial institutions either going bankrupt or being declared financially distressed. This is supported by the fact that all of the risky and predatory lending taking place during the build up of the housing bubble was made possible by the historically low interest rates. There never would have been adjustable rate mortgages, or option ARMs, if rates had remained higher. What made these mortgages attractive was that they offered low, teaser rates that made it appear as if low-income borrowers could afford the payments but did not consider the effects of what would happen when they rise. Once rates did start rising the house of cards came tumbling down, and borrowers began defaulting.
Now we find ourselves in an unprecedented situation with rates lower than ever and the economy in even worse condition. The government now owns a number of Fortune 500 companies, and there are many more deemed “too big to fail.”
Bernanke pulled out all the stops to prevent this last downturn from being too severe, while never addressing the fundamental problems that created the crisis in the first place. The dilemma now is that if another downturn is to occur the Federal Reserve will basically be left with no more tools to fight it off; after all, rates can’t be lowered below zero — or can they? The only thing the Fed can do at that point would be to print money, which would inevitably lead to an equally grave and debilitating currency crisis.
I’m not saying that if the Fed had raised rates and let large companies go bankrupt, we would all be fine and dandy. We would, however, already be on the path to recovery since entrepreneurs would have been able to buy the assets of those companies for pennies on the dollar and make them profitable, ultimately sparking job creation.
Chairman Bernanke has done nothing more than make sure all of the factors that allowed this crisis to occur persist into the future, with the taxpayer flipping the bill. So is Ben Bernanke’s re-nomination something to be lauded by all? Not by those of us who have an idea of the road ahead
Brandon Crossley
Junior, Business Administration
Monogamy is human nature
The question raised at the end of Jean Guerrero’s article (“Human
nature to blame for scandals” Jan. 31, 2010) is: “Is one [either a monogamy or polyamorist lifestyle] really more noble, natural, or reasonable than the other?” The question was raised and it invites a response. Here goes…
Let’s first address whether one is more natural than the other. As Ms. Guererro presented it, it seems that one lifestyle is natural while the other isn’t natural at all. Why? It seems that the polyamorists have confused an unnatural inclination for a natural one, and have completely disregarded the true natural inclination. I do not think that it is a natural inclination for humans to have more than one partner, but it is a natural inclination for them to have a sexual instinct. There is a difference. What the polyamorists have done is arbitrarily equated a sexual desire and a desire to have more than one partner.
Moreover, it is precisely our natural inclination to be jealous (in such matters as these) that protects and safe guards our natural inclination to desire sex. Our jealousy is the “no” which points us to a greater “yes” namely, one sexual partner. In reality, the natural inclination to have more than one partner does not exist.
Next, let’s consider if one is more reasonable than the other. Guerrero states that “evolutionary theory” supports the idea that in early human history, babies needed two guardians (man and woman) so that they could survive (i.e., not be eaten by wolves). She then goes on to say that because we no longer need to protect our children from dangers such as wolves, humans have evolved in such a way that we desire more than one partner (i.e., more than one other guardian). However, this whole evolutionary process seems backward to me.
Doesn’t it make more sense that we would have evolved in a way that resulted in more partners (and therefore guardians) during a time in which the threat (wolves) was greater? And doesn’t it make more sense that the evolutionary process would lead to a monogamy lifestyle as the threat became less (today)? However, the polyamorists argue the exact opposite of what makes logical sense leading me think that it is unreasonable. I argue that the polyamorists have made up the fact that evolution has anything to do with the issue. I mean, what evolutionary theory argues the facts that they propose and where can it be found?
Simply, a monogamous lifestyle existed then, because it is the natural inclination.
Matt Wheeler
Senior, Accounting