“Altruism: The Moral Root of the Financial Crisis” by Richard M. Salsman

This article presents a different explanation for the current financial mess. Salsman rejects the commonly offered explanation that the inherent flaws of the free market caused the recession. His economic explanation is not unique. Others, like Thomas Sowell, have shown that government policies, not fatal flaws in capitalism, thrust us into the present mess. Salsman takes a critical step not evident in other free market based explanations. He identifies the ethical ideas behind certain policies: these ideas, accepted by Republicans and Democrats, pushed an altruist agenda in order to help folks without the necessary financial means buy houses. This was a recipe for disaster.

Those who claim greed caused are partially (and only partially) right. While Salsman explains how banks were "encouraged" by the certain politicians to lower lending standards I'm sure it's also true that some institutions and individuals were motivated by greed to play along and even profit from these lowered standards. This would include those who managed Freddie Mac and Freddie Mae as well as their political buddies who protected them. Greed by itself doesn't explain why the housing market imploded. Otherwise it would happen all the time and not just in the housing market. (Do we see this happening, say, in the cell phone market? Or with PC's? Or food?) You need something to prevent the market from correcting itself. In this case one of the factors was the unhealthy alliance between those who ran Freddie Mac and Freddie Mae and those who "regulated" them and the banking industries. Greed certainly was a factor but not the sole or even the main one.