Chairman's Letter
Great expectations arose amongst the masses as Barack Obama recited the presidential oath. One can almost feel the anticipation as people await the fulfillment of promises made or promises heard. Change is on its way! I am cognizant that things said are not always consistent with things heard. Many people often "hear" what they want to hear rather than the words that are spoken. It is an observation that words spoken in political forum are often misunderstood by those on the listening end, at least that is the posture of the speakers when actions taken appear inconsistent with the words previously spoken. Trying to decipher all that is being said on the political front can be a bit dizzying.
In an attempt to separate myself from the hullabaloo surrounding the transfer of power on the national scene, I went to my bookshelves at home to find a good book for a pleasurable read. In scanning the shelves, there it was.............Great Expectations penned by Charles Dickens. I had not read this book since my high school days. The copy of Great Expectations on our shelves is a handsome leather bound edition that usually wouldn't lend itself to reading; it is there to look good. Despite its appearance I picked it up and carried it to my favorite chair. The story and its characters came back to me forthwith. As I thumbed the pages of this classic piece the story lines seemed similar in tone to today's commentaries on relationships and the influence of those relationships on one's life. The more things change the more they remain the same.
"Now I return to this young fellow. And the communication I have got to make is, that he has great expectations." These words from Great Expectations were spoken by the lawyer Jaggers to the orphan Pip as encouragement to leave his blacksmith apprenticeship for a finer life. The American people have declared similar sentiment in turning to President Obama as one with "great expectations." Those who are unemployed and struggling to make ends meet, those who are without adequate healthcare insurance and dealing with an illness, and those separated from family by war and worrying about loved ones are all searching for a better existence. President Obama is a "young fellow" in relative terms to those who have preceded him. The vote of the American people was "the communication" made that there are "great expectations" of him and for him. The throng of people present at his inauguration was the exclamation point on this declaration. High hopes prevail.
At times when I seemed a bit over excited in my younger days, my father often coached me to remember these words, "the higher your expectations, the deeper your disappointments." Now his point was not intended as a forewarning of failure, nor was it a warning to lower my expectations. My dad encouraged me to dream big, to aim high, and to be persistent in pursuit of the prize. He simply was serving a reminder that disappointment lurks on the perimeter of each ambitious endeavor and that I would be well served by recognizing the stark realities of a certain situation and the time elements associated with a particular plan. Reality tempers dreams and expectations. Patience is a virtue.
Today's economic environment is playing havoc with banks in general and to think that all Arkansas banks will escape the pangs of hard times is unrealistic. My expectations for Arkansas community banks remain high. But there is troubling chatter in the air. As an aside to conversations about the misgivings of the $700 billion Troubled Assets Relief Program (TARP), the proposed $825 billion stimulus package, the concept of a government controlled “bad bank,” and a deepening recession, I am hearing talk of nationalizing banks in America. Such talk makes me twitch. However, it is not far fetched.
My introduction to nationalized banking came in 1990 on a Rotary Group Study Exchange trip to India. At that time almost all banks in India were nationalized with a small number of private banks in the early stages of establishment. Today India’s banking system is comprised of nationalized institutions, private banks, and foreign banks. Since the early 1990s when India relaxed its stand on private banking enterprises, its economy has moved toward a market based system from a socialistic one operating in the world’s largest democracy. My concern is that America’s economy could move in the opposite direction from that of India’s if too many government controls are thrust upon our system. And then there would be the strained situation created by having government as both bank competitor and regulator.
It is certain that not all banks would be subject to nationalization. But even if the largest ones that already have sizeable government investments in them were to be nationalized, a further erosion of public confidence would likely occur. While our banks operate in a free market society, our success is rooted in the public trust. Regulatory oversight backs that public trust. It is apparent that the emphasis on deregulation in the late 1990s set the stage for some of the problems the system is now facing. Whenever we get “too hot” or “too cold” we have a tendency to push the thermostat controls to an extreme position in order to speed up the climate change we desire rather than adjusting it slightly to a comfortable setting. What must be captured is a true balance in the relationship between banks and government regulators. A working partnership between the public and private interests is required, not a transfer of ownership. Last December in an interview with journalist Tom Brokaw, then President-elect Barack Obama had this to say, “We don’t want government to run companies. Generally, government historically hasn’t done that very well.” This comment was made in response to a question about the future of America’s major automobile companies, but the same can be said in addressing concerns about the banking system. I remind myself that things said are not always the same as things heard.
Measuring success or failure of those in leadership positions is a favored past time of pundits and observing followers. The first 100 days of a president's term in office has been recognized as a magic moment since that of President Franklin D. Roosevelt whose actions within that time frame delivered a calming of fears in the midst of the Great Depression. I am hopeful that all the “great expectations” for the Obama administration are held in proper perspective. Swift movement to put policies and solutions into action is important, but it is more important that they be sound and practical. At this writing President Barack Obama has been in office only seven days. By coincidence the 100-day mark of President Obama's term falls on the opening day of the Arkansas Bankers Association's annual convention in Hot Springs. I look forward to seeing you at the convention so that we can continue this conversation about the banking environment and challenges ahead.
Until then may I suggest you find yourself an engaging book to pass the time? A classic like Great Expectations may not be your cup of tea, but there are other choices in keeping with people’s thoughts about our new president. How about the H. G. Wells short story The Man Who Could Work Miracles? Just remember, that one is science fiction.
Around the state and across the Miles, there is much work to be done. Let’s go have some fun!
No comments:
Post a Comment