Dear Congress

I am not normally moved to write my congressional delegation, but I sent this email to Senators Barbara Boxer, Diane Feinstein and Representative Jane Harmon:

Don't do it! Don't vote for the bailout package until after you have had a chance to talk to your constituents and we learn more about how the banks got themselves into such a mess.

Caps on bank CEO pay, while politically appealing, don't get at the root of the problem. How did people who thought they were so smart that they didn't need regulation* get into so much trouble? How did they amass and throw away so much money? Why are they so eager now for government intervention? This was a slow-moving train wreck and there is no need to act hastily.

Don't tack on more bailouts for unfortunate homeowners. We've all heard the hard luck stories. But propping up a bubble real estate market is not the responsibility of my government. In fact, by keeping real estate priced unrealistically high, government will be robbing young and responsible families of their chance to buy an affordable home.

If we need an economic stimulus package, do not throw it at the financial services or housing industry. They already have the cut in the capital gains tax and the mortgage interest deduction.

Our nation has other pressing needs. Our infrastructure is crumbling. Our public health safety net is practically non-existent. Our schools have become beggars. Our transportation system, especially in California, needs a major overhaul. Our military is involved in two foreign wars with horrific tolls on veterans' mental health. The bankers and the fools can get in line behind the rest of us.

In the Black Swan, Nassim Nicholas Taleb warned precisely against the type of "risk analysis" that was used by the brokerage houses. Their models looked only at small daily fluctuations and did look at the big picture. Actually, a lot of people warned that the pyramid scheme would come down.

BTW, did anyone else read about how some institutions lied to their own compliance departments so that they wouldn't have to stop trading when their reserves became too low? Now why would I want to help someone like that?

* Virginia rightly points out that investment banks are regulated. They just operate under looser regulations than commercial banks. I did know that, as demonstrated by the last remark about reporting false numbers to their own compliance departments. My only defense is that, my anger had momentarily blurred the distinction between hedge funds and investment banks.