According to one economist (Tim Hartford), "Clients of Goldman Sachs bought into a subprime mortgage deal called Abacus 2007-AC1, which had been constructed with input from the Paulson & Co hedge fund, which was betting that the entire thing would implode" (The banks had been very "morally hazardous".)
But if that wasn't enough "moral hazard", now there's also a push to legalize insider trading. Do remember Congress and that joke of the STOCK Act that they passed for themselves? These two actions could cause yet even more "moral hazards" in the financial markets. (see this great article about "moral hazards".)
Some members of Congress (including some Democrats) also wants to weaken the Dodd-Frank law on derivative trading --- creating yet even more "moral hazards".
That same economist (Tim Hartford) wrote a piece for the Financial Times called A Universal Income is not such a Silly Idea, where he says that the concept of paying people to sit around and do nothing has an upside.
"An increasing number of economists are beginning to worry that technological change may make large numbers of people completely unemployable. In short, the robots are coming to take our jobs. These concerns have been wrong before, but perhaps this time, it really is different. If so, we’ll need an economic system that can cope when lots of people have no way to making a living."
The Swiss, for example, are to vote on 2,500 franc minimum income for every adult. How much is that? It’s about £1,700 a month or $2,755 a month for people in the U.S. - - - And payable to whom? Everybody, or at least, every adult citizen. It’s called a “basic income”.
Editor's Note: Read Without Jobs, We'll have to Redistribute the Wealth - "Technological progress has substituted unskilled labor --- and technology will keep getting better, and will be better at cheaply doing stuff that people used to do. The tricky bit now, is understanding how—or whether—the bulk of the population will receive its purchasing power if not through wages. One possibility is broad redistribution. Society could set a basic income (or a guaranteed minimum income) that rises with economy-wide productivity, and as workers' potential earnings fall below that reservation level, they cease working."
Something else astounding is happening in Switzerland. For the first time ever, voters in a modern developed nation are also going to be voting on whether to create what essentially amounts to a “maximum wage” (pay caps on CEOs). Now THAT would NOT be "moral hazard" because...
...through many academic studies, we have already learned that the very rich are more unethical --- and they are also psychopathic and greedy. These studies also show that money is indeed the root of most evil.
Editor's Note: One example of "morally hazardous" behavior would be Mitt Romney. He would buy a company that had millions in a workers pension fund account. Take over that company with a borrowed money buy out . Use the pension fund assets to attract investors. Take the investors money, along with the pension funds, and move it overseas into a new company account with Bain Capital. Then charge the new company huge fees and sell the shares back to the company, effectively forcing them into bankruptcy. Then have company declare bankruptcy while the funds are overseas in the Bain Capital account (stashed away from US bankruptcy courts) forcing the US Pension Guarantee Fund to take over hundreds of million of pension funds due to bankruptcy --- and then stuff $102 million into your own personal IRA retirement account. (READ Rolling Stone's: Looting the Pension Funds)
And here's there's further proof that many CEOs are evil psychopaths. Were these heartless people simply born that way? Or do they learn this behavior in private schools? (Read more at Murder and Betrayal of the Rich and Famous for a short list of "morally hazardous" people.
Maybe that's why it's usually poor people who go to Heaven. They are too busy just trying to survive, let alone have the time or inkling to go out and protest in the streets. They have rent to pay and food to buy. They can't afford to take the same risks as the rich. They are too poor to be "morally hazardous".
Related Post: Escaping Income & Wealth Inequality