I Blame Diners Club

The biggest Ponzi scheme in history has been pulled off right in front of our eyes. A Ponzi scheme is where an individual or investment company pulls in money from investors, but uses that new money to pay previous investors without actually investing the money at all. The biggest, largest, most insidious Ponzi scheme of all time is...ta da...the United States of America Treasury!!! Yay! Here is the idea: Let's run this thing with OPM (other people's money). We can pull all sorts of shenanigans (see Iraq) and dump billions of bucks from the Treasury without asking anyone (except the clowns in Congress) if they think it's a good idea. We can spend spend spend and none of us ever have to worry about paying it back. It's like a credit card with no limit and no monthly bill. So we keep borrowing from the Treasury, sell the Treasury bills to China, owe them an unimaginable amount, and let the OPM take care of biz. Of course this makes the Chinese a little nervous about their rather large investment, but what can they do about it? Nothing really. If they protest too loudly then the Treasury notes fall in value and they lose money. They need us big time, and we need to keep borrowing to prop up the banks that started this mess to begin with.

I blame Diners Club. Back in the 50s they thought it would be a good idea to offer a card to diners. With that card you could eat dinner and pay for it later. It was a good idea because lots of traveling salesmen (remember them) were always on the go and treating their clients to dinner. This way they didn't have to have lots of cash and could pay the bill later. Then American Express caught the idea and the credit card miracle took off. Except the credit card companies were later deregulated (thank you Supreme Court) and charges and late fees took off. People started using their cards way beyond their means and defaults became a problem. On top of that the greedy banks gave out mortgages in the same way, beyond people's means.

Voila! 2009.