Commentary

The presidential campaign is over and the global financial crisis remains.

President-elect Barack Obama offers hope for a fresh start even as prepares to face a backlog of enormous problems.

The Garment & Citizen believes our nation is up to any and all challenges, able to achieve a new unity and purpose in these trying times.

Yes We Can, indeed.

You’ll hear some say that these challenging times leave no room for finger-pointing over the origins of the financial mess we face.

The Garment & Citizen begs to differ. We firmly believe that our nation will be served well by understanding how this mess came about. This is part of the challenge, and it will require some sorting through the rubble and—yes—some finger-pointing.

A lot of time could be spent on the Wall Street big shots who played significant roles in the whole affair.

There’s certainly room for a hard look at the culture of monetary hedonism that grew in Corporate America over the past several decades.

There are bigger culprits out there, though. We’re talking about the elected officials who the voters of this nation have trusted to keep an eye on those Wall Street big shots. That’s a basic part of the job for Washington politicians—voters don’t expect Wall Street big shots to behave themselves.

You’ve probably noticed that politicians generally don’t do very well when it comes to facing their own shortcomings on the job.

You’ve also probably noticed a phrase that’s been on the lips of politicians who want to dodge any blame for what ails our financial system. It began making the rounds during the presidential campaign, as so many elected officials performed the circus act of scurrying for cover even as they lusted after airtime on cable TV shows. Here is the basic message, although you’ll hear plenty of slight variations:

“The problem is that we have a 20th-century regulatory system for a 21st-century financial market.”

Keep in mind that many of the Washington politicians who have uttered this sentiment have the authority to keep an eye on our financial regulatory system. They have been—and most of them remain—in positions to raise questions and seek changes to the system at any time.

Remember also that our financial regulatory system has never been chiseled in stone. It can and has been changed over the years. The truth is that the system itself cannot be outdated—it can be adjusted as needed by our elected officials. They have always had the standing to consider new developments in the marketplace—exotic investment instruments and lax mortgage-lending standards, to name a couple—and seek changes to regulations on such practices.

The only thing outdated in recent years has been the elected officials who have had oversight of our financial regulatory system.

The world changed, and the financial industry changed, too. The politicians who were supposed to ride herd on the financial industry didn’t change.

The Garment & Citizen will give some of the politicians in Washington a back-handed benefit of the doubt on the motives behind their lack of oversight—it’s become clear that most of them had little understanding of the forces tearing the financial system to shreds.

Yet we remain suspicious that some of them didn’t know because they didn’t want to know—because they were taking in all the campaign donations they needed right up to the point of the meltdown.

We’ll leave it to our readers to decide how all of that shakes out.

Whatever you decide, though, don’t let any politicians off the hook by accepting the notion that events simply overtook an outdated regulatory system, and there was nothing to be done until the whole thing broke down. This is the worst sort of bunk—the kind that will embolden ignorance and influence peddling in our political class if left unchallenged.

The Garment & Citizen is most certainly hopeful about the incoming Obama Administration, and we believe that the U.S. can beat this bad spell.

At the same time, however, we urge all to complete the full exercise of getting a grip on what has occurred.

That will require some finger-pointing.

—Jerry Sullivan, Editor & Publisher