Interesting news from Britain: The UK Independent Commission on Banking led by Sir John Vickers, a former Chief Economist at the Bank of England, issued its report. Tasked to propose structural banking reforms in the aftermath of the 2008 financial crisis, its principal recommendation is to separate retail and investment banking. Is that not what we had with the Glass-Steagall Act until it was repealed after 70 years? Our own banking reform did nothing to quell the bankers' gambling frenzy as evidenced this week by the reported $2 billion lost by a single trader at UBS. He was betting on the price movement of certain Exchange Traded Funds. Given the thousands of bets and the inevitable probabilities, it is only a matter of time before the banks throw us into a deeper hole than last time.
The poverty report out this week is truly depressing. Last year the number of Americans (46.2 million) subsisting below the poverty line was the highest since records were kept 52 years ago. The rate is now 15.1 percent up from 14.3 the prior year. That is almost 1 in 6. It is worse for children — 1 in 5 overall and a shocking almost 1 in 2 in African-American and Hispanic households. The situation has been getting progressively worse in this Administration's term of office.
The median family income has dropped to an inflation-adjusted $49,445, a figure last seen in the 1990's. Almost 50 million Americans had no health insurance coverage and 48 million of working age had not been able to work a single day. The statistics cry out for equity in the world's richest country. If across the board cuts are mandated because the "Super-Committee" fails to agree, these figures can only become worse. The sad truth is that if the Bush tax-cuts had been allowed to lapse, these cuts would not be necessary.