VANCOUVER – A lot of people are at fault for the world financial crisis, said several WSU Vancouver experts at a recent campus forum. And recovery will require good decision-making by a lot of people, including everyone at the local level.
Among those to blame are large East Coast investment banks that took big risks, insurers that said they would protect those banks, and credit rating agencies that underestimated the danger, said Joe Cote, professor of finance. Also at fault were people who took out home loans they couldn’t afford and the mortgage brokers who encouraged them, he said.
Politicians and federal regulators made it easier for risky borrowers to get money, said John Becker-Blease, assistant professor of business.
But placing blame on the right people may be nearly impossible, he said.
“You have guilty and innocent home buyers, guilty and innocent banks, guilty and innocent politicians, and we can’t separate them,” Becker-Blease told the Clark County Columbian newspaper. “Are we angry enough to let a lot of innocents suffer in order to get the guilty? Or are we going to let the guilty get away with this in order to help the innocent?”
Local governments can play a key role in recovery, said Paul Thiers, associate professor of political science. They set priorities, permit and attract business, create jobs and affect social policy, which is important if there’s an increase in unemployment and homelessness, he said.
Individuals, too, can do their part by living within their means.
“It’s unpopular to say ‘Spend less,’ but that’s exactly what you have to do — spend less,” said U.N. Umesh, professor of marketing.
“We’re going to be bearing the burdens of a lot of decisions made by other people,” said Jerry Goodstein, business professor. “We are going to have to sacrifice.”
“There is a lot of disagreement about where we are and where we’re going,” Thiers said. “We don’t know where the bottom is.”