Looking for cover, blaming capitalism, and pointing fingers is the convenient and irresponsible way to respond to a national crisis that should have been anticipated by elected and appointed public officials, had they paid attention to the warning signs, mustered enough political will, or merely cared enough about the financial solvency of our nation. Washington politicians and market regulators want to blame someone else for the systemic and cultural weaknesses that were exposed on their watch and while they were asleep at the wheel. Everyone fell asleep, became complacent, built cozy relationships, and maintained conflicts of interests, instead of preserving professional independence and exercising levels of judgment and oversight that would have mitigated the impact of the financial practices that led to the near collapse of the financial system.

You can’t blame Wall Street for engaging in practices that government and industry watchdogs are supposed to oversee and regulate. Congress should be doing its own self-examination and judging itself because it has failed to overhaul the regulatory framework that monitors the financial instruments and transactions that have become increasingly risky and exotic in nature over the past decade. As it stands, not too many in Washington exhibit a full understanding of the esoteric nature and impact of hedging instruments like credit default swaps as they are routinely created and traded among global financial institutions and investors to manage risks and ensure great returns. It seems more likely that not only did the financial industry become aggressive in its efforts to mitigate the risks associated with pools of mortgage assets, but our elected officials’ and government watchdogs’ eyes were blinded and ears were deafened by the complexities and breadth of the global financial markets. In a weird way, the chickens may have finally come home to roost – for Washington, Wall Street, Main Street, and the global economy.

Americans ought to hold consumers, financial institutions, industry regulators, ratings agencies, Fannie Mae, Freddie Mac, the Federal Reserve, and Congress accountable for the economic crisis. We need to recall that it was Fannie Mae that engaged in funny and manipulative accounting practices related to the mortgage assets on its books. As their top executives were forced to relinquish their posts, no one seemed to take seriously other red flags that were exposed as Fannie Mae was also actively promoting homeownership in new ways that ultimately encouraged new and unsavory firms to enter the mortgage business. As these unscrupulous mortgage companies entered the market to take advantage of our government’s efforts to provide homeownership opportunities for targeted groups, the degree of fraud and abuse escalated beyond anyone’s imagination. The goal of promoting greater homeownership is a noble one; however, once again our elected officials failed to insulate the programs and their implementation from the fraud and abuse that resulted. The federal government continues to be misguided and myopic in its thinking and responses to the underlying causes for the current crisis -- it has not yet properly accounted for the weaknesses and failures across our financial regulatory systems, the irresponsibility exercised by individual consumers as they took on mortgages they couldn’t afford, the bond ratings agencies that turned their heads, or the role of Congressional mandates given to Fannie and Freddie, to name a few.