I thoroughly dispute Mark G. Brennan’s thesis in “The Borrowers’ Crisis” (Vital Signs, November) that it was the borrowers who were mostly to blame for “the crisis.”

How did the party-of-the-first-part—those lending and mortgage-financing institutions—get away with making loans to uninvestigated potential borrowers, uncollateralized borrowers?  Where were the state and local regulators?  Where were the accountants?  Where were the auditors (internal and external)?  Where were the federal regulators?  Where were the unconscionably overpaid CEOs and bank presidents?  How can it be possible for so many to have been derelict in their duties without there having been some Enron-Arthur Andersen playbook in operation?  The probabilities for so much mal- and misfeasance to have occurred for so long without recognition of the potential of devastating consequences are 1 in 10 to the 10,000th power.

Borrowers, small and large, speculators, small and large, could not have gotten a red cent from lenders if the institutions involved had not allowed it to occur with full knowledge of their probable inability to repay their loans, but through all their “clever” maneuverings and exotic packagings and bundlings (“insurings”?) these institutions thought they had it made—forever.

Blame for the bubble catastrophe and today’s “greed is their creed” climate—and the meltdown and depression—must go to the party-of-the-first-part, which initiated the irresponsibility through its negligence, not to the party-of-the-second-part, which was allowed, carte blanche, to become part of the “greed is good” fixation!

—Bill Scaduto

Punta Gorda, FL

Mr. Brennan Replies:

Chronicles readers knew this day would come.  And the letter above announces its arrival with all the fanfare it deserves.  We can now add the concept of personal responsibility to the burgeoning list of taboo topics—the United States’ unconditional support of Israel, the American embargo of Cuba, and abortion—the mere mention of which brings out the intellectual storm troopers to set the parameters of acceptable discourse.

My original piece sought to balance the press’s Jacobin demands for bankers’ heads on pikes with the facts of the real-estate crash.  I was careful to include the letter writer’s concern that the U.S. banking system shares a large part of the blame when I wrote that “No one denies that large financial institutions played a major [emphasis added in the hope that this time the word will be noticed] role in the real-estate shenanigans of the last decade.”  But I also reminded readers that, “For every mortgage lent, there was a borrower who sought that loan,” before I wished “a plague on both their houses.”  Identifying borrowers as complicit in the fiasco in no way absolves the respondent’s “party-of-the-first-part.”

The respondent is free to “thoroughly dispute” any thesis I propose in my articles.  However, he is not at liberty to attribute to me a thesis that I did not write nor to dispute that same fantastical thesis.  Unfortunately, his letter does both.

But thanks for reminding me that an analysis of excessive executive compensation is long overdue.