Given the faint improvement in the economy, we seemed to have averted the failure of the banking and financial systems. But it's important to keep in mind that, even though the latest economic crisis struck fast and deep, it is only one symptom of a far deeper and more damaging problem, one that has been building slowly and insidiously since the late 1970s.

Despite several severe economic disruptions, most notably the 1980-82 recession, the 1987 stock market crash and the dot-com bubble of 2000, only the very oldest among us have ever experienced a downturn like this one. The severity takes your breath away. It may never be completely understood how so many financial institutions collapsed so quickly. But it's easy to see why it happened.

Personal responsibility and morality are the foundation upon which our society is built. This is not true of every society, but in ours, where all actions are legal unless specifically made illegal, individuals are responsible for their own actions and choices. We assume, whether we explicitly acknowledge it or not, that people will manage their own affairs by and large in a manner that is socially acceptable.

This is why the Founding Fathers so admired religious teachings, even as they were so troubled by attempts to put the teachings into practice. As John Adams said, "Statesmen, my dear sir, may plan and speculate for liberty, but it is religion and morality alone which can establish the principles upon which freedom can securely stand."

This is not to underestimate the importance of making and enforcing good laws. Nor is it meant to devalue the importance of effective regulation and oversight. Checks and balances are also among our timed-honored principles. While we hope for and encourage acceptable behavior in all, we rely on contrary interests to restrain it.

Solving problems in the most efficient, effective manner resides first with the people. The framers of the Constitution intentionally designed our government to be slow, cumbersome and inefficient.  Our government was designed to react to crises, not solve them before they occur.

So what bearing does this have on the current economic crisis?

When bankers offered to lend more than borrowers could pay back (resulting in overleverage), why didn't the borrowers say no? When borrowers wanted to borrow more than they could afford (such as they did with subprime mortgages), why didn't the bankers say no? When bankers offered overleveraged mortgages (mortgage pools) to the investment bankers and Freddie and Fannie, why  didn't the latter groups say no? When investment bankers brought the overleveraged mortgage pools to the rating agencies, why didn't the rating agencies say no? When investment bankers tried to sell the overleveraged mortgage pools back to the bankers, why didn't the banks say no?

Our current economic situation is but the most easily observed symptom of this more fundamental crisis. Remember, federal regulation of the securities markets came only after the crash of 1929 and the Great Depression. The federal government became involved only after the markets demonstrated their inability to regulate themselves.

In this regard, I am reminded of something Benjamin Franklin said after having helped write the Constitution. A woman ran up to him and excitedly asked, "What type of government have you given us, Mr. Franklin?" Franklin replied, "A republic ... if you can keep it." We retain our freedom of action only to the degree that we act responsibly and restrain ourselves. If we do not manage ourselves, someone else will do it for us and to us, and in ways we will find both burdensome and onerous.

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