Billy Bailey is at it again!

The most dramatic scene of the Frank Capra classic "It's a Wonderful Life" is not when George Bailey tells Clarence that his life is worth living and he wants to go home. Most people choose, yes, after reviewing what would have happened were they not to live and love. The most dramatic, derived from the Greek "to do", scene in the movie is when Billy Bailey loses the money in Mr. Potter's bank. Billy is the quintessential well meaning man. He wants to help his nephew run the bank. However, by misplacing the $8,000 helps run the bank into the ground. Billy's well meaning gaffe leads to Mr. Potter finding the money and not returning it to George (another essay on evil could be written about Potter), the bank examiners finding the bank insolvent, a run on the bank, and eventually George's decision to kill himself.

Well, given the drama this week I'd like to posit that Billy is at it again in the form of our business and government leaders. Yes ladies and gentlemen there is enough blame for everybody. I'm not an economist, hardly, but I do know that the current difficulties we are encountering are not borne of an evil Mr. Potter but bumbling well meaning men. On the business side you had businessmen doing what businessmen do: trying to make money. The way they were doing this was to give out risky mortgage loans at low interest rates that would go up in the future. They would make money NOW and bet on the economy expanding. There was no need to worry because housing prices were on the rise and people's paychecks would rise as well giving them ample opportunity to repay the loans. Large corporations also began buying up these loans to leverage their portfolios. Billy Bailey was fine as long as the $8,000 was in his hand.

Our government leaders weren't much help either in this. As the housing market grew the government forced Fannie and Freddie to lower their standards for loaning money. Now people who couldn't afford or qualify for loans were getting the green light from Fannie and Freddie to buy houses. Well meaning Billy strikes again. There was no oversight of these unsound loans and their specious balance sheets. Our Congress did not oversee any of these loans since the housing markets were bullish. Billy Bailey had not tied the rope around his finger to remember where the money was.

So now we've got this whole debacle with the government bailing out Fannie and Freddie, nationalizing AIG, and most recently the classic Frank Capra-esque run on WaMu that resulted in it's downfall. However this shakes out, it was not evil or greed that led George to the ledge that Christmas Eve. It was well meaning, unreflective, bumbling old, wonderfully human Uncle Billy.