RECKLESS!

The Democratic senator from North Dakota exposes the greed, deception and self-interest that has contributed heavily to the current economic crisis.

In clear, piercing language, Dorgan (Take This Job and Ship It: How Corporate Greed and Brain-Dead Politics Are Selling Out America, 2006) explains the mortgage crisis, showing how the profit motive led financial institutions to combine risky subprime mortgages with AAA securities, “akin to the days when meat-packing plants used sawdust as filler in sausage.” In order to increase their incomes, mortgage brokers were willing to promote subprime mortgages with hidden escalating payments to consumers with bad credit. Meanwhile, the Bush administration’s approach was to promote free markets and self-regulation. Soon large financial institutions with prestigious names were discovering toxic assets embedded with subprime loans that had gone bad. Dorgan also targets unregulated hedge funds. They are responsible for approximately 50 percent of the daily trading on the New York Stock Exchange, and have “behaved like sweaty gamblers at the craps table,” making huge bets on complicated financial instruments or “dark money,” potentially manipulating the market. The author is indignant at the fact that top hedge-fund managers make billions in annual income and yet pay only a 15 percent tax rate by redefining their income as “carried interest.” Why, he writes, should salaried workers be subjected to tax rates that are much higher while billionaires find tax loopholes? Dorgan makes no apologies for his liberal viewpoints, asserting that they indicate a sense of liberty and integrity that is crucial to the American dream. He believes that “capitalism in its purest form, completely unregulated, is like a race car with no brakes.” His anger at the private, no-bid Iraq war contracts awarded to companies like Halliburton is understandable, and he’s adamant about the necessity of oversight and regulation—specifically as it relates to the tax loopholes exploited by hedge-fund managers.

Eye-opening, timely and inspirational.