NASCAR & SPEED RACER HELP EXPLAIN HOW FINANCIAL REFORM FALLS SHORT

It's no secret that NASCAR got it's start back in the days of prohibition. Illegal moonshiners and whiskey runners, trying to outrun the law, would find ways to make their cars faster than those of the local police. And they did. Today's NASCARs are marvels in mechanical engineering.

While the cars have gotten faster, the vehicles used on the NASCAR circuit aren't allowed on our public streets for a reason. They're too damn fast, and they aren't up to code (though they can withstand a crash better than the average car). In fact, laws on the books prohibit you and I from tampering with our cars in ways that would make them too big or too fast for public roadways because of the temptations and affiliated dangers that come with having access to all that speed and power.

It doesn't matter if you are a professional racer, over time even the best can crash and burn. Worse, they will take even good drivers out with them.

When you do get car that can outrun the police speeding laws, the highway patrol, the flow of traffic, etc. all work to keep you in check. Put another way, as much as Americans love NASCAR and going fast, we all understand that you can't have people running around driving like NASCAR drivers in suped up automobiles. Even Germany's famous autobahn has 'coercion' and other rules that are enforced by the autobahn police.

This is what makes the current financial reform legislation so frustrating. We know that having "too big to fail" (TBTF) financial firms isn't good for the nation. We saw this in 2008. We saw variants of this in 1987 and in 1929. Yet the current financial reform bill being discussed in Congress does little to nothing to rein in the stupidity and greed we saw before 2008 by the TBTF banks. Indeed, private bank analysts are even suggesting that the financial reform bill won't have any teeth at the end of the day.

It's as if, after causing a series of epic crashes on our nation's highways, we said ...

... "No problem, let's allow the NASCARs, the muscle cars, and other Speed Racer wannabes out on the public road ways. They're good 'ol boys anyways. Nothing's going to happen. We can trust them, this time."

Then we have the fact that the financial reform bill does little to nothing to stop the big banks from trading in highly speculative derivative products, with taxpayer backed (FDIC) money. In a few words, banks can continue using your money deposits - which are government insured - to make market bets that only the banks profit from. If the market tanks, and the banks go under again (and they will), it's you and me the FDIC who has to come in and save the TBTF banks, again (under the guise of insuring your money, of course).

And, No, the provision in the finance reform law that says banks will be liquidated and the executives will be fired if they go belly up (again) is no real safeguard. There were already provisions for this to happen. We didn't use the law in 2008 because ___________________ (fill in blank). What makes us think we'll use it the next time? Because we learned our lesson after 2008? Give me a break.

The financial reform bill currently making it's way through Congress essentially tells all the financial Speed Racer wannabes, "Don't worry. If you crash, or make other people crash, we'll pick up the tab through our 'Speed Racer Wannabe' insurance program" (otherwise known as FDIC).

Look, at the end of the day, if you want to supercharge a car and race it you can always go to a local speedway on the weekend, or beome a professional and join the circuit. The point is, you're the one on the hook for your need for speed. Similarly, if you want to claim to be a super capitalist because you make supercharged market bets you're supposed to use your own damn money. And then you're supposed make market bets in a way that affects only you when your bets don't pay off.

Is this really hard to understand?

- Mark