Back to the 80s

Behind The News
July 14, 2008 1:12:20 PM PDT
Back when I was a young whippersnapper of a reporter, I covered business. My penchant was white collar crime, and it just so happened that business and white collar crimes were hot topics, back in the 1980s. For that, we could thank Ronald Reagan, who took deregulation of the financial industry to new highs.

Or lows, depending on who lost money.

And there was much money lost.

Every Friday morning, I'd call my banking sources and ask which failed savings and loan, or bank, would be shut down by Friday night by federal regulators.

It was always a Friday; that way, regulators would come in just as the bank or S&L was closing, take over, and, hopefully, reopen Monday morning with investors not making a "run on the bank" from any panic.

It mostly worked, this clean-up of the financial mess. Unless, of course, you consider the taxpayer dollars lost in bailing out these financial institutions.

As a reporter who loved investigative journalism, they were heady times. Men, and they were all men, who should not have been running hot dog stands, were in charge of hundreds of millions of their investors' savings.

Tales of bad management, mismanagement, corruption, greed, fraud - all the Gordon Gekko stuff from that era's movie "Wall Street."

I'd have to stay late on Friday nights, writing stories about regulators raiding such-and-such savings and loan, and the customers who were worried about their deposits. The government insured then, as it does now, individual deposits up to $100,000, and then half the amount above that, up to $250,000. That insurance - the Federal Deposit Insurance Corp (FDIC) for banks, and the Federal Savings and Loan Insurance Corp. (FSLIC) for savings and loans -- was born after the Great Depression, when the nation's financial institutions collapsed in the years after the stock market crash of 1929.

It was great to be a reporter back then on this story, but it was a lousy story if you happened to be a human being. Economic suffering can make you feel like that.

I was thinking about those days during the bail out of the two biggest mortgage guarantors in the country - the agencies known as Freddie Mac and Fannie Mae. They are also the most conservative -- not lending for second homes or multiple properties. Their stocks had plummeted and the government has bailed them out. Most people, no matter what side of the political aisle, don't think the government had much choice.

We'll have the latest on the bailout, and the ongoing mortgage problems - more aptly a crisis - tonight at 11.

Also at 11, have you seen The New Yorker cover? The one with Barack and Michelle Obama on it? I suppose that the magazine that views itself as an intellectual forum views the cover as a spoof - a spoof of those who believe that, say, Obama was raised a Muslim (more than 1 out of 4 in a Newsweek poll believe that, erroneously).

And I get humor, and satire.

But there are many who believe the cartoon cover went too far, and in a country where there already is so much misconception, portraying the potential new First Family as terrorists and Islamic fundamentalists, with an American flag burning in the fireplace, isn't so much satire as it is fanning the flames of racism and misunderstanding.

Either way, The New Yorker cover has sparked a huge controversy. I'd like to know how you feel about it. Please click on this link to see the cover:

And if you want, please e-mail me your comments at Bill.S.Ritter@ABC.Com; as always, let me know if I can use your name in this column.

We're also following the not-unexpected announcement from Pres. Bush that he wants to lift the ban on off-shore oil exploration. The President thinks this will help solve the nation's energy dependency and high fuel prices; there are many others, however, who don't. We'll have the debate, tonight at 11.

We'll also have any breaking news of the night, plus Lee Goldberg's AccuWeather forecast, and Scott Clark with the night's sports, including the hoopla leading up to tomorrow's All Star Game at Yankee Stadium.

I hope you can join Sade Baderinwa (in for Liz Cho) and me, tonight at 11.