Irwin Kula
Rabbi, author, commentator

Irwin Kula

Kula is the President of The National Jewish Center for Learning and Leadership in New York. He has served congregations in St. Louis, New York and Jerusalem.

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Economic Crisis: Some Are Guilty All Are Responsible

Well, I guess the conservative philosophy of "faith" in free markets that has dominated America for the past 28 years since Ronald Reagan and which was adopted by the religious "right" as if it was gospel has now been revealed to be what classic religious teaching would call idolatry. And I guess mistrust of government, another conservative article of "faith", has turned out to be one of those morally relative judgments now that private financial institutions need bailing out. And I guess the basic religious and spiritual notions of accountability and taking responsibility have been annulled with regard to financial leaders and their institutions that need to be "saved". And clearly the core obligations the powerful and affluent have to care for the vulnerable and poor are secondary to the "commandment" to rescue the wealthy.

Our economy's recent and yet to be financial failures, the likes of which we have not seen since the Depression, are profound moral failures. Anytime a society has millions of people lose their homes and jobs, major institutions disappear over night, and its citizens experience unprecedented levels of insecurity, uncertainty, and anxiety about the future there is a moral issue with moral implications. Of course, the first round of reaction we can expect is the typical low-level blame game between Republicans and Democrats, liberals and conservatives, free market economists and interventionists, supply-siders and Keynesians, and the poor and middle and wealthy classes.

But no great moral or spiritual insight is required to know that the moral failure that has led to our present crisis is as old as human beings - in a word GREED and it would be far too easy for any "us" to simply blame some other "them" and thereby deflect and project our responsibility on someone else. And there are many of "us". There are the hundred or so people at the head of each of these "stalwart" financial institutions whose greed led to decisions all along the way which destroyed their institutions. There are the brilliant and innovative financiers, who developed incredibly complex investment vehicles which were supposed to spread risk, whose greed actually blinded them to risk as they and their investors "earned" ungodly sums of money. There are the politicians on both sides of the aisle who failed in their roles as servants, representatives, and protectors of the people whose greed to maintain their power kept them from telling their constituents the truth that not everyone can own a home and limited their ability to tell their powerful supporters that regulations that had been gutted under President Clinton were indeed needed. There are the nine federal agencies responsible for overseeing some part of the mortgage market and there are the real estate brokers whose greed inspired them to break every "rule" in seducing people with mortgages that were beyond buyer's means. And then there is us: regular Main Street American home owners whose greed compelled us to take on mortgages (or second mortgages) that we knew were too good to be true in order to support consumption well beyond our means.

Every religious and spiritual wisdom tradition suggests that great moments of collective trauma or suffering are also invitations - not for flight (turning inwards to simply protect ourselves) or fight (blaming others) - but to honestly self-reflect, introspect, and grow. Obviously, some people are guiltier than others for this economic crisis but in an interdependent reality all are responsible. From a religious or psycho-spiritual perspective we begin a genuine and healthy process of reconstruction and renewal when each of us, wherever we are on the continuum of "power" and "influence" is prepared to ask:

What did I do that may have contributed to where we collectively find ourselves?

What personal responsibility do I have for what is happening? In what ways did I buy into an economic model completely built upon greater and greater consumption - a system in which our ever expanding desires far too easily are turned into needs? How has my understanding of happiness and success (getting, amassing, having, and consuming more and more) distorted my values and fed my greed? How much did I hide myself from the truth I knew deep down - that something was wrong as there is no easy credit in life: credit needs to be merited earned.

Yes, there has been serious moral failure that has led to this economic wreckage and moral failure requires accountability. Accountability begins with ourselves and then and only then can legitimately be extended outwards to those who do in fact carry greater responsibility. So let's start to rebuild our social contract which has been eroded by the age old vice of greed. Not by descending into a blame game but by each of us seriously asking ourselves three simple moral questions:

What did I do to help get us to this place?
What do I need to change with regard to my own behavior?
What can I do to help the most vulnerable of my fellow citizens - those who more hurt and vulnerable than I am - and there is always someone more vulnerable than we are?
(For those who enjoy a Biblical reference: Where are you? and Where is your brother?)

And let's stop having faith in the economy and begin to have faith in each other - trusting that the happiness that comes from greed is transient at best while the happiness that comes from giving, serving and even sacrificing for each other is far more enduring and credit-worthy.

By Irwin Kula  |  September 22, 2008; 8:38 AM ET Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
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Posted by: comprarsilde | September 29, 2008 9:40 AM
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Posted by: comprareviag | September 29, 2008 7:59 AM
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Posted by: Anonymous | September 29, 2008 1:45 AM
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THE FOOLPROOF BAILOUT

Unless the HOLES in the financial system are properly plugged up, this 700 billion dollar bailout will just GO TO WASTE. The reason why we are in this FINANCIAL MESS is because all those holes came into play at full throttle. Some people simply abused the weakness of the dollar for their benefit. Upon seeing the weakness of the dollar, they played up the price of oil. They can do it because as we have seen last Monday, there is no regulation that can stop them from doing so. With very high oil prices, the companies become vulnerable and weak. Here comes the SHORT SELLERS taking advantage of that weakness and betted that the stock prices of these companies would fail. As a result of stocks plunging, many companies struggled and many could have borrowed money from banks and in the process raised the interest rates. Also, profits from short selling contribute to excess liquidity and to offset this liquidity, interest rates are raised. As interest rates climbed, so does the mortgage interest rates. Many homeowners defaulted which put banks on a tough situation. Again the SHORT SELLERS saw the opportunity to profit so they came BETTING AGAINST the banks until we see all these big banks failed.

Now, we can see that there are THREE BIG SUCKING HOLES that came into play that put us into this mess. The FIRST are the SPECULATORS who played up THE PRICE OF OIL. The SECOND are SHORT SELLERS which pulled down the stock market. The resulting HOLE (third hole) which these two sucking holes created are the FORECLOSED houses which continue to burden the financial system.

The SOLUTION to this mess is simply to PLUG UP these THREE HOLES. First is to create an OIL PRICE STABILIZATION LAW which I explained in my earlier posts. Second is to PERMANENTLY BAN SHORT SELLERS. Thirdly, if they want a bailout, it should be used to relieve the homeowners by lowering their mortgage interest payments and return the foreclosed houses to its previous owners under a restructured payment scheme that's affordable. The third solution will release the banks from bad debt and can therefore continue and start clean anew.

The hedgefunds which will be affected by the ban on short selling can look for MORE PRODUCTIVE investments like the manufacturing sectors and new technologies sectors. This shift of investment would lower interest rates because manufacturers would not be crowding in the banks for loans. This will also make our manufacturing sectors competitive. As a result more jobs will be created.

This is WIN-ALL SCENARIO and to achieve this, THESE THREE HOLES MUST BE ATTENDED TO, otherwise, NO BAILOUT WILL SUCCEED.

GOD BLESS AMERICA.

Posted by: spiderman2 | September 24, 2008 1:16 AM
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Posted by: deliveryespe | September 23, 2008 4:00 PM
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THIS INSANITY MUST STOP ( Our National Security is AT STAKE)

It is high time this INSANITY SHOULD STOP. The reason why the U.S economy is so vulnerable to Wall Street speculation is because of SHORT SELLING. The economists DO NOT REALIZE that these people (short sellers) are like PRINTING MONEY UNHINDERED. Earning money at the expense of others (short selling) is NOT EARNING BUT STEALING. It's the same reason why we can't print money freely because it is tantamount to stealing.

UNLESS the regulators BAN THIS SHORT SELLING IN THE STOCK MARKET, Americans will continue to SUFFER ECONOMICALLY as what is happening now. The ENEMIES of America does not need an airplane to crash to our buildings. They only need to PLAY UP THE OIL PRICE IN THE STOCK MARKET and then start BETTING ON THE OTHER STOCKS TO FAIL thru SHORT SELLING. Not only can they ruin the economy of America, but they can also make themselves rich by doing so.

NOW WHERE ARE THE BRAINS OF OUR LEADERS AND ANALYSTS ?

BAN SHORT-SELLING AND IMPLEMENT THAT OIL PRICE STABILIZATION MECHANISM NOW and all will be well again.

That 700 billion dollar bail-out should be used to relieve American homeowners by lowering their mortgage interest rates and those who already lost their homes should be asked to return with their payments restructured.

Posted by: spiderman2 | September 22, 2008 11:26 PM
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WE NEED THAT OIL PRICE STABILIZATION MECHANISM LAW NOW.

We have seen how the price of oil jumped 16 points in just one day for no valid reason. It's very clear that the government (both Congress and the executive branch) has NOT DONE anything to rein-in speculators. It is therefore NOT farfetched that oil would rise up again to an all time high as before.

I hope they would now legislate a bill that would rein-in the STUPIDITY of these speculators. Oil has been the lifeblood of world economy and people should not be allowed to play on this commodity. It's very clear that the speculators are not using their minds. They do not understand that they are slowly hanging themselves as the price of oil shoots up to where the economy cannot perform anymore. Their money would be deemed useless if there would be a work stoppage worldwide.

I hope Congress would make a law that would put a price cap on oil everytime speculators are playing with it. If the price of oil today (Monday) is 120 dollars per barrel, the price cap tomorrow (Tuesday) should be 120 dollars per barrel. Since it cannot go up that price, there would be massive panic selling which would pull down it's price. If the price of oil closes at 110 dollars tomorrow (Tuesday), the price cap should be set at 110 dollars per barrel on Wednesday. There is no way to go for the price of oil but DOWN if this mechanism would be put into place. Once the oil price reaches a SANE LEVEL of maybe about 90 dollars, regulators can then SWITCH-OFF that mechanism so it can settle to it's true value. There must be a body that can switch that mechanism on or off as the need requires.

We NEED THAT MECHANISM NOW AND CONGRESS SHOULD ACT NOW BEFORE THESE IDIOTIC SPECULATORS WOULD HAMMER THE ECONOMY AGAIN.

Posted by: spiderman2 | September 22, 2008 10:27 PM
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I don't think anyone would disagree with you on the moral traps of the capitalism, but I doubt there is a way out. The foundation of the capitalism is the selfish human nature, and the stock market, while drawing out capitals otherwise tucked under beds, is in fact to encourage one “rob” millions with a few key punches in the cubicle of a merry and innocent-looking glass building without seeing a pain-twisted face or hearing an anguish cry of the robbed, and without awakening the warm-hearted animal of guilt in shallow and uneasy sleep. Yes, someone could follow your advice, have a profound reflection, and become a saint. But at most the society gains one hermetic eccentric, a laughable nuisance, a sore loser in the eyes of people swimming along the mainstream. The cruel joke is that, no matter where he hides, he can't escape from being robbed, because the wealth of the world is re-distributed with every key stroke of the Wall Street traders – if Warren Buffet makes $1 billion today, we each must in some way contribute unless we count “consumer confidence” as commodity.

The saddest casualty of the capitalist triumph is the total collapse of sense of “care” in health care. As health care is put on price-tags in the market like a smuggled girl in a red district, all the human compassion is striped bare and "care" becomes a misnomer: all but a few people are in it for the money and the sick are no more than milking cows. The intricate healthcare market makes the concept of “care” almost hypocritical; doctors, administrators, and everyone else could all let loose of their greedy instincts in pursuing the green bills without any moral afflictions, because, in the open market, they never directly take money from the sick and frail they take "care" of. Doctors simply demand more from insurers and government “what they deserve”, and insurers demand more from the insured with all good reasons, government borrow more from China without worrying who will eventually pay. So here is our market system that sugar-coat greed so perfectly and deliriously, until one day everything sinks into the global-warmed, elevated ocean.

Posted by: CLZ | September 22, 2008 4:02 PM
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What are our temptations in Government and money?

God's Daily Promises. 9/22/08.
"This week's promise: God has conquered all our enemies"
How well do you face temptation?"

"Then the Devil took him to Jerusalem, to the highest
point of the Temple, and said, "If you are the Son of
God, jump off! For the Scriptures say, 'He orders his
angels to protect you, and they will hold you with their
hands to keep you from striking your foot on the
stone.'" Jesus responded, "The Scriptures also
say, 'Do not test the Lord your God.'
Matthew 4:5-7 NLT"

Facing Temptation is Human, not Spirit? Do Humans test GOD or the Devil in their 'Flesh Temptations'. GOD is LIFE. Devil is Death.

Who is Ahead on Planet Earth in the Tests of Temptation, in the Human Race? GOD or the Devil? GOD, nor God, our Human Ancestors, tempt Humans. Devil Male Body Birth, Devil Flesh Lust does. How do Misbred Humans Resist Flesh Lust?

Is it Time to Accept Who Humans are Serving. The Devil's Ultimate Weapon, the Nuclear Bomb, and Killing Laser Technology? Why Kill GODs Planet, and All Life Our Ancestors Colonized on Earth?

The Unknown GOD/LIFE has given the Human Species Free Will, to follow LIFE or Death. The High Tech Science Equal Humans, our Human Ancestors, have chosen GODs Eternal Physical Life, After Equal High Tech Science Birth.

Equal Male and Female Equal Human Clones, took over the Unequal Reproduction of Humans. Ever since Humans began Killing Each Other.

So what are the Results of Sin? A Dead Planet Earth after the Last Days Nuclear 'Arm'ageddon, and the Planetary Judgement Day Fire from our Pollution?

The Human Species do Colonize Planets. We do Know this High Tech today. What exactly is Life After Death in Heaven? Our Decomposed Elements returning to GODs Storehouse, Our Universe?

Posted by: Dolores Lear | September 22, 2008 3:47 PM
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Thank you for your summary and honesty of this dire situation our country is in, yes, due to GREED. And lets hope that for all who have a strong moral value follow your suggestions. These past years have are the proof before the eyes what Greed does to our lives. Each and everyone on of us. And we are all responsible for the majority of the current situation. We have sinned, now we have to seek forgiveness.

Posted by: debplus4 | September 22, 2008 1:47 PM
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-Voto Se! Yea! Yes!

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Posted by: By American-Votary-Association’ of the “O.ne U.niversal R.eligion” Movement on Holy Earth! | September 22, 2008 11:51 AM
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"Give the people of the United States the facts which reach our government with regard to events in all areas in which the freedom of the American press is in any way restricted."

In our society the people decide for themselves what is best and the press supports the people. The government doesn't always like that, but it beats having a ruined press and ignorant people that are both powerless. Invest in the newspaper business and use some of the profit to help those less fortunate. Wall Street can help itself. It will do about as well as those it helps. The economy just keeps rolling forward along with the presses. Some people would like to stop both and it just can't be done. You can't stop the rain. Take an umbrella if it looks like rain. It looks like rain here at the estate, so the garden should be happy. That's where my lunch is now growing out of the ground, so I better go pick lunch. Some things you can't pick, so you need to choose. Choices are good and options are many.

Posted by: baron | September 22, 2008 11:32 AM
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Amen, Rabbi.
I hope the current bout of remorse lasts beyond the financial institutions' yamim noraim, and is not just for show. But somehow I doubt it.

Posted by: Julia Iskandar | September 22, 2008 9:14 AM
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Victoria-

I'm pretty sure he's not saying all are GUILTY, but if we're going to distinguish ourselves from the selfish people who are indeed guilty of all of this -and help get ourselves out of this mess, natch- then we should be open to making sacrifices to help others out. And I don't mean 'sacrificing' by letting the government spend tons of taxpayer money to bail everyone out. Real sacrifice is on an individual level. And there's plenty of people who are very deserving of the charity of those who were either better-prepared for this, or just lucky enough not to get hurt by everything happening.

Posted by: Wakka Wakka | September 22, 2008 8:38 AM
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The Money Changers gives some interesting perspective

Then and now.

http://coinage.me/coinage_the_money_changers.htm

Posted by: Richard Thomas | September 19, 2008 1:50 AM
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Speak for yourself. I am not responsible.
I've spent a lifetime being ridiculed because I did NOT jump on the gravy train- did NOT live beyond my means-

No, religion does not call it idolatry- religion calls it USURY-

And unless you are free form it's influence in your own life- you don't really have the moral high ground to assume that everyone else is guilty.

People will not ask themselves these questions-
and as soon as the DOW bumps up a bit- people will promptly forget and revert to their ususal consumptive ways.

Unless you are truly practicing your religion as proscribed, and have no usurious history yourself-
your censures have a flatness about them.

Posted by: VICTORIA | September 18, 2008 12:16 PM
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