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Kall: Wow!
Sanders: Does that seem so radical?
Kall: It sounds wonderfully radical. How do we do it?
Sanders: Well, hopefully we do it by electing a new president; hopefully we do it by developing a strong grass roots movement in this country which demands that a new president and Democratic leadership in the house and the senate move forward in a progressive manner.
But I think especially after the experiences of the last couple of weeks, if people don't understand that we've got to break up some of these huge companies which are too big to fail, if we don't under stand it now, we're never going to understand it; this economy has so many structural problems, but increased monopolization of industry after r industry fewer and fewer companies owning and controlling one segment of our society after another I mean this is something that we just have to take a look at.
Kall: I've tried to pull back a little and look at this. What Paulson says, and what panicked Paulson and the leaders in the senate was that there was a drying up of liquidity—of availability of money to be loaned for whatever use for last week.
Sanders: Yes.
Kall: And that's what set off the panic. It wasn't that certain companies were going out of business; it was the liquidity and the availability of loans.
Sanders: well, their argument, for better or worse was that if companies can't get their credit, there is a danger that companies will fold.
Kall: Yeah, but the solution doesn't have to b e to protect these loser companies that have failed basically that have gambled away and have gone into extensive risk. That was not successful. The answer was to maintain liquidity by whatever means. Right?
Sanders: Yep
Kall: So, what I don't understand is—I was talking to my bank; they're doing very well. It's a local bank; it's a decent sized bank. They say that the way they did it was they didn't get involved in a lot of the loans that a lot of the others got involved with.
Sanders: That's right
Kall: It's almost like they're being punished. "You didn't get involved, so you don't get a piece of the pie." Why are we rewarding the ones that did?
Sanders: Well, that's obviously a hotly debated question here. And that gets to executive compensation as well. But it is very clear that this crisis has been caused by a deregulation, which means that trillions of dollars of financial transactions are now taking place in an unregulated area, and frankly, nobody knows what the hell is going on.
What we do know is that it’s the result of the sub prime mortgage crisis; one large inst after another is--we have seen a number of them folding already and others are in danger of folding so the issue now is, according to Bernake and according to Paulson, if the congress does not act in the very near future, very short term, they worry very much about a financial meltdown.
