DaveinNYC is here to Grieve

Simple Answers

I got a lot of problems with you people; but I'll just narrow it down
to one issue for this year. This year's gear grinder is most people's
need for simple answers to everything. God knows there's plenty of
examples of the dim bulbs of the world turning Occam's razor into a
tool for super retardatry, but I will just focus on a recent situation
that is doing a great job of providing people of all stripes an
opportunity to reach conclusions without having to go through all that
messy critical thinking.

The current housing mortgage blowup is what I'll be focusing on.
Really, trust me, it's relevant. Why? Because the cause of the
debacle is absolutely infested with simple answers to what is a very
complex situation. Basically lowered interest rates made money cheap,
so lenders were more willing to lend to all sorts of people with all
sorts of credit, these people were able to buy all sorts of homes with
the credit, the people who sold their homes were able to take their
gains on the home and buy an even bigger and more expensive home, with
a little help from the easy credit train. These loans were
repackaged, sliced and diced and sold to anyone who wanted to invest
in them. This money poured back into the lenders which allowed them
to offer even easier credit, wash rinse and repeat.
Now the borrowers can't repay the lenders, the lenders can't make new
loans, the owners of the securities aren't getting their cash, home
prices are crashing, and God damnit it's got to be someone's fault.
Whose fault is it though? It's everyone's fault. Of course nobody
want's to say that.
If you check out most of the articles and posts about housing and the
credit crunch you'll see the word "sub-prime". This basically means
poor people. You know, since it's the poor who really managed to
convince the banks to allow the purchase of a half million McMansion
with no money down, and no income verification.
Of course this is a lot better than the nut jobs who swear that this
is because the 'gubument' dun force da banks to lend money to
minorities (they can't just say blacks anymore, big tent bigotry
includes brown people too).
Then there's those who point the finger at predatory lending. With
banks forcing bad loans on sweet old ma and pa whoever. Gosh darn
those big city bankers picking on the simple folk who just want to own
a home.
Moving up the food chain, there's Wall Street. Since they are the
ones who packaged these crappy loans into securities.
Finally there's the Federal Reserve, which is blamed for not dropping
the hammer on this mess years ago, and stopping the bubble before it
got going.
Now like I said at the top, everyone I listed is at fault here (with
the exception of the minorities, I mean seriously, it's one thing to
be blamed for drugs and crime, but for the potential collapse of large
financial institutions?). Some people took advantage of the banks,
some banks took advantage of borrowers, Wall Street packaged up some
good securities and some crappy ones, and sometimes they knew damn
well which were which, and of course the Fed really should have
stepped in at some point and told people that houses really shouldn't
be going up in value 10% every year.
But my point isn't who is to blame, my point is that nearly everyone
who looks at this situation picks only one of the players to blame,
and usually they pick the one they just don't like. Black helicopter
fearing goldbugs blame the fed, rich people blame poor people, anyone
about to lose their house blame the banks, and a whole lot of people
are blaming the Street, since they're the last link in the chain that
led to them losing money. Now if this were the only situation where
people grasped on to the first explanation that has fewer syllables
than a one line haiku it wouldn't be so frustrating. The problem is
it isn't. Cut taxes, bomb them, increase funding, cut funding,
pitching, coaching, so many complex situations are routinely boiled
down to one quick fix.
Now I don't know exactly why people love simple answers so much.
Perhaps people are just really, really stupid and this gives them and
evolutionary advantage by letting them not use their brains. Maybe
people like they way their juices flow when they've got someone they
can really hate, and this lets them latch on to a target that much
quicker.
What I do know is that this desire for the quick and easy answers
will be the death of us. The only thing that keeps us where we are on
the food chain is our ability to think and reason, god knows it' isn't
my physique. We need to deal with problems the way they are, not the
way we want them to be, and we need to come up with the correct
answers, not just the answers that happen to fit our biases.

Comments

[Phil]

Amen.