After $700 billion dollars of free, taxpayer’s money and billions of dollars of bonuses paid out to the bank’s employees for doing such a wonderful job, we find out that the banks are still in trouble, that our country is still in trouble.

Paul Krugman tells us this morning that "...while the wheeler-dealer side of the financial industry, a k a trading operations, is highly profitable again, the part of banking that really matters — lending, which fuels investment and job creation — is not. Key banks remain financially weak, and their weakness is hurting the economy as a whole."

Well, let’s break it down. What I have been saying throughout this crisis is that the economy is not the banks. The banks are tools and the economy is the people. It does no good to fix the tools if the people are broken.

People are still losing their homes. Congress, like some municipalities, needs to pass a law to prevent any more foreclosures. That would make the banks renegotiate their "toxic assets." With people assured that they will be able to keep their homes, the banks will then also have to create a favorable climate in which people can keep their jobs. That means lending.

Congress can make a big difference by encouraging lending in key areas: green industries and other industries that make use of green technology. Lots of countries are investing in manufacturing in this country. Why can’t our own corporations do the same? Until our people go back to work, they won’t spend money. Until our people have money to spend, our economy won’t move.

In Keynesian economics there was a term called the "multiplier." It explained how banks were supposed to create money. People earned money. People saved some of it in the bank. The bank kept a percentage of it and loaned out the rest in a responsible manner.

Other people took those loans and created more jobs. That put more people to work. Some of those working people actually took raw resources and made things that others wanted. That was called "manufacturing," something we used to do here a lot — now, not so much. But, like I said, there are other countries that are finding it profitable to make things here, Why can’t we?

Only when we put people back in their homes; share the cost savings of globalization with the consumer; reinvest in our infrastructure and education; give people jobs and hope will we turn this economy around.

Taking the people’s hard earned taxes, giving it to the banks so they can reward their useless employees, and putting nothing back into the real economy (the people) will only plunge this country deeper into despair.

By Ken Sayers.

Source: http://dailycensored.com/2009/10/19/ok-lets-fix-this-thing/