John Allison is God

The Ayn Rand Institute finally posted the video from BB&T Corp. Chairman John Allison's January 29th speech on the causes of the financial crisis. I just watched it and it is a concise and yet inclusive depiction of the multitude of factors that culminated in the present financial catastrophuck-up. For the business-educated, the speech provides a panorama of the financial landscape, naming specific culprits, such as Fannie Mae and Freddie Mac, the Fed, the SEC, and several others. The conclusions he draws are so technically obvious by the end, that one wonders how any policy makers could possibly be innocently ignorant in this process.

For the layman, the speech might get a tad technical at times, but Allison explains himself along the way so as to make the material accessible to anyone. For those of you who have only a cursory understanding of the financial and real estate markets and the causes of this crisis, I highly recommend viewing this video. Allison depicts the crisis in a logical, sequential manner, highlighting how a combination of disastrous government policies inflated the housing market, masked riskiness of investments, protected unhealthy but well-connected firms, discouraged prudence and thrift, as well as a number of other undesirable outcomes.

What continues to amaze me, but shouldn't, is how the government repeatedly distorts a market (such as housing) for its own political gain, and then proceeds to prolong, exacorbate, and further distort the market correction that is a direct result of its own interference. The ultimate and most disturbing tragedy of the government's handling of this crisis (there are many others) is the effect it has on the most productive, virtuous members of society. Allison repeatedly mentions how the government's actions discourage banks to be healthy, discourages smart, talented, rational individuals from entering a the industry, and all-around incentivizes people who might otherwise lead successful lives to be lazy, stupid, dependent contradictions of themselves.

The larger grows the state's reach, the more good people at the margin get sucked into moral depravity. (Naturally, by moral depravity I mean that they systematically and consciously destroy their own lives) Every day it requires greater strength and resolve simply to pursue one's happiness.

Lately, I am reminded of a line from Casablanca that I think sums up the despair and sense of futility that government control engenders in people. When Victor Laszlo and Ilsa Lund are meeting with Signor Ferrari in the Blue Parrot seeking an exit visa to Lisbon, Ferrari tells them getting two visas "would take a miracle. And the Germans have outlawed miracles." That is my main fear for the future, that the powers in Washington will steadily and systematically outlaw everyday man-made miracles.