A large slice of the current economic mess can be traced to the financial disaster caused by different kinds of dangerous investment practices on Wall Street. The worst of these is the securitization of various debt obligations including home mortgages.
In a nutshell, driven by the need to make double digit returns, financial propeller-heads purchased shaky debt caused by various bad business decisions, mixed them with a small portion of good debt, then bundled and particalized them throughout the financial system in securities.
The ratings agencies, who had conflicts of interest all over the place, gave these securities top ratings, then banks and investment houses all over the world bought these things, even if they didn’t know what they were. Yep, that sounds dumb.
Just as dumb is what also drove this mess was the really bad decisions made by millions of people. Folks loaded up their credit cards to the max far beyond what they could ever pay at usurious interest rates. They purchased home they couldn’t afford with mortgages that in the end they could never afford. Some of more rational people said were betting that the skyrocketing house prices would just go higher. But I am betting most people just used the extra cash to buy more consumer goods and didn’t think about how two years later they would be underwater.
On top of that, despite the slow decline in general wages, people bought more and more stuff, usually on credit. What were these people thinking?
As looks now, the only way for the U.S. to dig its way out of the mess is to work the problem from both ends – working the banks and getting the mortgage system working again by helping homeowners. It has to be done somehow, but I just can’t get passed bailing out knuckleheads either on Wall Street or in Wal-Mart.

Despite the mystique of the news business, most of the work of daily newspapers is the simple business of meat-and-potatoes journalism - going to meetings, monitoring government, writing stories about people in our community and, on a good day, exposing something that has gone amiss. And all of this needs to be written in a clear, understandable style. On a day-to-day basis it's a fairly simple product.
Readers crave information. We are up to our eyes in uniformed opinion and analysis.
Nationally over the past 50-60 years daily newspaper owners have made fairly hefty profits and have, on the side, been able to fund newsrooms full of professional journalists who are adept at reporting, editing, weighing information and writing quickly and clearly. The downside is that newspaper owners, until the last couple of years, haven't seen the need to adapt their business model to problems that starting emerging as long as 20 years ago. They have let the simple small well display advertisement slip away with out a fight.
It's the business model that has failed, not the journalism model. I don't see how scattered, part-time bloggers on politically loaded websites are going to fill the same information need as newspaper reporters.
As our Seattle daily newspapers devolve, it will be sad to see the loss of simple reporters who work their beats, attend meetings and work the phones.
Democracy will still be healthy. It just will be dumber.