The American consumer has been transfixed to a myth; You can have whatever you want, at anytime you want, for no money down. No cash? No problem! Bad Credit, No Credit? No Problem! Buy Now. Default later. I'm loving it. In Debt we Trust.

Our society has been mesmerized by President Bush's 9/11 mantra, " Be afraid. But go shopping." Mankind's self serving materialism didn't originate there, of course, but it was inoculated with steroids by an Administration determined to keep Americans full of bread and circuses while they occupied Iraq, lost trillions at the Pentagon and paid out hundreds of other billions in cost plus and no bid contracts to their big pharma, homeland security and military industrial complex friends. What's a little graft between government agencies?

Trickle down theory. Now the American public is investing in greed, debt and destruction.

The aggregate credit card debt of U.S. households, according to Robert D. Manning - Director of the Center for Consumer Financial Services - was a mere $60 billion in 1980. This month, December of 2007, the Federal Reserve reports the number has risen to $872 billion dollars. That's a lot of gas, cell phones, gadgets, clothes, digital cameras and groceries and nights on the town.

Have you dared to miss a payment? Your penalty is swift. Your friendly "free" credit card turns you into a slave with exorbitant fees of 29.99% for your one time mistake. Those folks on the 800 number just "can't do anything" about it, even though the Federal Reserve cut it's target rate to 4.75%. and it's discount rate - what it lends to banks - to 4.75%

There's a word for this business practice. Immoral.

Perhaps it's time to watch Freedom to Fascism again.

And for the folks who were sold sub prime loans, it gets worse. What is a sub prime loan? In a nutshell, they are adjustable rate loans intended for folks with damaged credit histories, The risk vs. reward ratio would call for these loans to cost a bit more. And that these costs are fully disclosed and understood.

But there was something sinister in the small print of the more recent sub primes. Exploding interest rates. Exorbitant prepayment penalties. No need for tax returns or even documenting the buyer's income. Just sign. And this house - which you can never afford and we can make more money when you are forced to refinance it in a couple years - can be yours with a very small monthly payment! Of course, you didn't see the small print about the $300 - $400 dollar jump in your monthly mortgage payment, but hey, you're got your dream home!

Faith based economics, greed driven mortgage brokers and a less educated populace who signs. . . and sinks.

According to the Center for Responsible Lending, 2.2 sub prime loans made by families - or one in five - will lose their home. The Florida number is estimated here.

You read that right. 2.2 Million families will lose their homes. Here's how Mark Zandi, the chief economist at Moody's Economy.com describes the situation;

“This is the most serious housing downturn since the Great Depression.”

As foreclosures increase, housing prices decrease. Less equity means a decreased credit line. Decreased credit leads to fewer expenditures. Fewer expenditures translates into a shrinking pool of building contractors, furniture and appliance dealers, painting and plumbing suppliers - you get the drift - and the wave trickles downward.

Last August, the National Association for Business Economics panel declared;

"The combined threat of sub prime loan defaults and excessive indebtedness has supplanted terrorism and the Middle East as the biggest short-term threat to the U.S. economy."

My question for the NABE is just how "short-term" is "short - term?"

And how profound will this fallout be? I'm not sure anyone knows the full extent. My mantra? Less pork and more freedom. My suggestions? Eliminate as much debt as you can. Save as much as you are able. Turn off the television and read a book. Hug your loved ones. Buy locally. Ride a bike. Start a garden. Stock up on honey, water, peanut butter and canned goods. Get to know your neighbors. And your local city officials.

It's time for us to get our houses in order. Including those in Washington, D.C. I'm looking forward to writing a bill that bans drug advertising from television and work with other like minded folks to put a halt to the usury and greed paradigm currently ruling the credit industrial complex.

Here's more for you to mull over. And feel free to send me your thoughts. I’m at samm@sammsimpsonforcongress.com

This one, by Sean Olander, a San Mateo, California lawyer, is one of my favorites. He suggests jail time for a few of the loan shark operators.

The Economic Consequences of President Bush. by Nobel laureate Joseph E. Stiglitz, describes the overwhelming economic disaster wrought by this administration. I whole-heartedly agree that it will take a generation - at least forty years - to make things better. I'm willing to give it my all. How about you?

The Economic Consequences of the Bush Administration.

Dan Dorman proposes that we're headed to the Worst Recession since the 1930s.

Housing Slump Damages State Revenue.

Anatomy of Financial Calamities.

Why Municipal Bonds are Stumbling.

Insurgent American's 35 Point Practical Guide for Action.

Satire - Operation Change for the Better. (Thanks to Melissa.)