It is expected that Corsair Capital, a New York based private equity group will sign a deal with National City today that will affect Germantown.  You've guessed by now, if you're a regular reader, that the effect is to keep our newest bank name, National City Bank, in Germantown, at least for the foreseeable future.  Corsair and some other individual investors will put around $6 billion into National City at a share price of some $5.00.

We earlier traced the evolution from St. Francis Bank to Mid America Bank to National City Bank in the first Blog that discussed the plight of National City.  It's shares closed at $8.33 on Friday and that marked a 52 week decline in value of 78%.

So, it appears that my friendly, efficient bankers in Germantown will continue to be there when I need them.  I'm happy for them and for me and the rest of their customers.  Changing banks is a nuisance.  If there are direct deposits, those must be changed.  If there are automatic withdrawls, those must be changed.  New checks and bank cards must be obtained, and decisions as to which of the numerous accounts offered is the right account need to be made.  If Internet banking is involved, there is another level of change, and if telephone banking is involved, yet another level.

We sometimes are oblivious to the things that happen on Wall Street and the world but many of those distant happenings directly involve us in one or another ways.  This whole subject has been one that most of us has not followed...and yet it has an impact on our nice little village.  Our economy has truly become a global economy whether for the better or not.  IBM sold its laptop computer business to a company in China.  The Jaguar and Range Rover nameplates are now owned by a company in India.  GM is building a new engine plant in Brazil.  Medical x-rays are read off shore.  When the Far East markets hiccup, Wall Street flinches.  The demand for gasoline and diesel fuel in India and China have thrown our prices into a seemingly unending upward spiral.

Perhaps more important, these changes have occurred in a relatively short span of time..in decades rather than centuries.

Our politicians are dancing along merrily plotting to see just how they can use your money and mine to reward less-than-desirable behavior.  They have forgotten, if ever they knew, that when we reward bad behavior, we get more bad behavior.  On the other hand, if we permit some kind of 'pain' to follow poor decisions, we tend to see modified behavior.

What has this to do with the sub-prime mortgage debacle?  Plenty!

First, our government swooped in to help save the mortgage bankers that had encouraged this irrational activity given the lax oversight of federal agencies.  And, it continues down that same path.  What lesson will be learned from this?  Simple: we can continue to do stupid things with money because the government will bail us out just like always.

Second, the politicians fell all over themselves to earn 'points' (also known as votes) from the people who had over-extended and gotten themselves into this mess voluntarily.

What will be learned when a couple earning less than necessary to support the payments, is 'given' a mortgage loan using the adjustable rate feature in spite of credit scoring?  And who, when the rates went up, were given a 'pass' on the deal?  The lesson being taken away when there is no 'pain' associated with the decision is this:  it's okay to do things like this because the government won't let us hurt ourselves!

The answer is that each of us has to pay the price for our decisions.  If we are not forced to pay a price, we will repeat the same behavior or worse.  We can all remember that 'little urchin' in the neighborhood who could do no wrong in the eyes of his or her parents.  They were the worst little kids in the neighborhood.  We can probably each remember how we 'got away' with something, and we can likely remember just how that experience tempted us to continue doing whatever it was that we had 'gotten away with'.

Why is it that politicians think the way too many of them do in these situations?  Because, if they can succeed in getting the majority to think like this, they will have achieved their goal.  What is that goal?  The goal is to get the majority to believe that without big government involved in every decision we take in our daily lives, even if we hurt ourselves, it doesn't matter; it doesn't matter because big government is there looking out for our best interests. 

This is a decidedly liberal point of view.  We don't often hear conservatives espousing this kind of action.  The solution to this 'slippery slope' mentality seems obvious to me: elect conservatives and re-elect other conservatives if the first group loses sight of reality from having been in office in Germantown, West Bend, Madison or Washington for too many terms.  This is how we influence the direction of our community, our county. our state and our country in a representative form of government!

Our ignoring such problems is how the politicians who want the 'nanny' state to evolve past the tipping point get that to happen.  And it will happen at the rate our country is moving down that pathway.  Once it happens, there will be no turning back.