It all started when I got the email from my Aunt Connie, my late Dad’s sister, inviting my family and me to come to Alexandria, VA for a rare family reunion celebrating the 90th birthday of my Uncle Tolly, a retired Army dentist and all around great guy.

My Uncle's Speech at His 90th Birthday Party

So there we were, at the Ft. Belvoir golf club, with 50 relatives who had assembled from the West, East, and Gulf coasts, from the age of 90 down to age 1. There was truly a deep feeling of legacy, as I met for the first time the numerous young offspring of my cousins and second cousins.

From Tolly, a proud member of the Greatest Generation, to myself and our Baby Boomer cousins, what kind of a legacy and country were we going to be leaving for the youngsters (including my own twin daughters who are currently age 9)?

The next day, we realized that our hotel was just 5 miles away from Mount Vernon, the historic mansion and farm of George Washington, the Father of our Country. We decided to check it out.

Let me tell you, our minds were blown. The entire George Washington estate has been restored and expanded with a museum, and numerous educational multimedia presentations funded by a private foundation. The story of Washington’s childhood, upbringing, early career as a hero of the French and Indian war, and leadership in winning the Revolutionary War with the British against tremendous odds, is breathtaking. The qualities of Washington himself–who turned down the invitation to become the King of the colonies (twice), who served as Commander of the colonial forces without pay, and whose influence enabled the U.S. Constitution to be created and put in place after the post-war Articles of Confederation became dysfunctional–are utterly inspiring. George Washington brought competence, strategy, political skill, persistence, resilience, and a belief in a higher power and a greater good, to the principles on which our nation was founded.

My daughters enjoying George Washington's estate on the Potomac.

While George Washington is known as our country’s first President and Commander in Chief, he thought of himself first and foremost as a farmer. Recognizing the inadequacies of 18th-Century farming practices, he pioneered innovative and environmentally-friendly methods, including crop rotation, and the use of organic fertilizers, and recycling.

George Washington was an entrepreneurial farmer and businessman and an outstanding manager. His whiskey distillery and gristmill and farm utilized innovative technologies that were cutting-edge in the 18th-century. His thriving farming and fishing businesses required a wharf to transport goods by boat to Alexandria.

Everyone in both houses of Congress should be required by law to visit Mount Vernon during their first year in office.

Failure to know the true foundation principles and values underlying our country’s founding results in ignorant, uninformed and belligerent opinions, which are totally adverse to the spirit in which our Country came into being, and which must be restored.

Which leads me to…

The House and Senate Were About to Vote on the Debt Ceiling

Ironically, this iconic family event took place just as the Congress was debating the debt ceiling and how to cut the deficit.

After visiting Mt. Vernon on Sunday, I met with Sen. Richard Blumenthal (D-CT) and two of his aides at his Senate office on Monday afternoon, moments after the House voted to raise the debt ceiling. We had a very productive and candid 45-minute talk about the state of affairs in Congress, and innovations needed to respond to Baby Boomers’ challenges (including a detailed discussion of how my Social Security reform proposal to create the Boomer Corps could positively affect communities, non-profits, Boomer mental and physical health, and our nation’s well being).

A Historic Moment for the Roll Family

The Next Day

The next day, my family and I were at the Capitol and in the Senate Gallery just after the Senators had voted to increase the debt ceiling. Yet hearing the discussion and debate, I couldn’t help but feel that the Senate and in fact the entire Congress is totally not up to the task of making the hard choices and dealing out the shared pain that which are needed to bring the Country back to a solid footing, both ideologically and financially.

Two days later, the S&P rating for the U.S. was downgraded, for the first time in history. Based on the dismay and despair I heard in the voice of Sen. Mark Warner of Virginia, speaking of the standoff in Congress over providing funding to the FAA (for air safety!), and the willingness of Congress to incur an immediate revenue loss of $1.2 billion in aviation tax revenues, rather than vote a $14 million allocation, I came away feeling that the current leaders of Congress are not capable of the task of trimming the wasteful practices and habits that have gotten us into this debt crisis.

What is needed in Washington is hardnosed and experienced turnaround management, not a bunch of amateurs with no hard-earned experience balancing the books. No wonder a whopping 62% of Americans said they would dump all current legislators in Congress if they could vote today, according to a survey released August 4.

What should we do?

I believe we must immediately get this country onto a budget that is lean and mean, and do so on a proportional, shared sacrifice basis, without endangering the survival of the most vulnerable citizens.

1. We must restore individual income tax rates to their historic levels of decades past, which were in place during both Republican and Democratic administrations. We need to tell corporations, if U.S. citizens must pay their taxes, you must pay your taxes for the privilege of being part of this unique country. And if you don’t want to share the benefits of being a “citizen” of the U.S., then go ahead and leave.

2. We will then need to incentivize through tax policy investments in start-ups and growth ventures that will create the jobs to replace any corporations that elect to leave.

3. Finally, we should pass legislation that imposes on Congress the same lifestyle experiences faced by ordinary Americans with respect to health insurance, pensions, Social Security, and job insecurity. Once that happens, we’ll see how quickly they turn themselves and the country around!

In the meantime, what can you personally do to protect yourself and your retirement savings?

This Thursday at 10AM EST, I will be sending you a letter and a video presentation I recommend you watch. I think it will tell you some sound steps to take going forward in this perilous economy.

Be sure to watch for it in your inbox.

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Now I’m making this letter public to further press these key points. When you read the letter, please let me know what you think and I’ll be pass them along where it will do some good.

Dear Senator Dodd,

I appreciated your letter of October 2 regarding my prescription for “untying the Gordian Knot” and restoring stability in the U.S. housing markets. I have been closely following your efforts with both the Health Care reforms and Financial Services reform bills and have enjoyed our work together in the past, particularly on passage of your PMI reform bill and in support of the AHA’s National Smoke Alarm Awareness project conducted with the City of Bridgeport and its fire department. I greatly admire your motivation and efforts to craft effective legislation in each case that achieves the desired goals and outcomes on behalf of consumers without adding excessive burdens that inhibit private enterprise.

There are several thoughts I’d like to share with you that could have impact as you work to finalize these bills in committee, and deal with the various controversies that will arise.

The first is that there needs to be a clearly stated mandate and set of principles for each bill that assures that those in government who are to serve as watchdogs in enforcing the provisions of these laws understand their duty on a basis that resists the influence of politics. Clearly the SEC failures in the last decade must not be repeated. Take politics out of fiscal soundness regulation. What’s needed is a watchdog, not a regulator. The job of the watchdog is to give pushback (or always be a threat of pushback), to level the playing field, to publicize wrongdoing, and to deter others in the industry from following down the same path.

Second, there always needs to be a system of checks and balances put in place to assure that accurate information is being produced and reported, and that the law is being carried out.

Third, transparency must be created via a process of auditing which assures that fiscal integrity and soundness are maintained.

Fourth, capital adequacy must be enforced relative to the risks being incurred and the type of stakeholders (account holders or policy holders or investors) at risk—the various standards for capital adequacy articulated, measurable, measured, and enforced.

Fifth, there needs to be a clear distinction restored between risk capital and safety capital as applied to investment or merchant banking, versus deposit taking and lending. Take risks with your own private risk capital as much as you wish, so long as you are not jeopardizing the safety of others who are not voluntarily at risk. But neither the taxpayers nor the safety return stakeholders should be put at risk. Thus the question of “too big to fail” becomes a vital issue requiring timely attention.

Let’s encourage risk taking so long as the risk is being taken by those who have the capital to risk and stand to be rewarded, but not by taxpayers or depositors.

Sixth, fundamentally, the banks should be chartered to serve the public, while making a decent return, not to rip off the public with exorbitant and unavoidable fees so they can make risky investments suited to investment banks, private equity and hedge funds and risk capital. As a lifelong financial services industry professional, and sometime industry gadfly, I believe I have gained a bit of insight and expertise into how an effective consumer watchdog agency could perform these functions. I welcome any opportunity, assistance or input I can provide which would help you achieve these goals.

Seventh, a consumer financial services agency must have teeth. It must be primarily a watchdog, more than a prescriber of rules, but it should not hesitate to prescribe, initiate, or clarify rules when there is a clear pattern of abuses taking place against the public’s interest. Some time ago, I testified before Chairman Henry Gonzalez’s House Banking Committee and helped to re-write the legislation, which corrected mortgage escrow overcharge abuses, resulting in refunds made by servicers of more than $5 billion to homeowners with mortgages. To this day those particular abuses have not raised their ugly heads again.

There is no doubting that a vibrant financial services industry is necessary for a healthy and growing consumer economy. Monopoly power is always desired by companies and moguls. It’s the job of our government to absolutely assure that they don’t receive it, whether explicitly or implicitly.

Impulse buying and undisciplined financial behavior unfortunately affect the majority of financial consumers. Building savings and financial security is a slow, unexciting, incremental journey of consistency. Most households in this era have had too many destabilizing events to maintain that consistency for long. Combined, the recent spate of abusive practices, the present financial climate, excessive hidden or involuntary fees and costs, and excessive dependence on household debt loads have threatened to return the bulk of the U.S. middle class to the condition of serfs under feudalism. This was not the vision that was established and fought for by the Founding Fathers.

If a National Health Care Policy is to be passed into law, it should include both incentives and disincentives to achieve reform of our national health practices. A carrot and stick approach, to both health care providers, and consumers, should produce checks and balances. For example, there should be penalties applied for obesity and smoking, as both are well-documented to result in degenerative diseases, excessive medical care needs and costs, and premature death.

Basic nutritional education should be required in elementary school, along with basic personal and household financial education. There is no point for elementary school children to be able to name every type of leaf and every type of fish, and not know how to live a solvent life.

You and I have each had the delight and good fortune to have our children after age 50. I have two daughters in grade school (my twins, Allison and Rebecca, are in second grade at the Mill Hill public elementary school in Southport, CT).

Let’s leave this place better than we found it. I know that is your desire, and you know it is mine. Congratulations on your purposefulness, your diligence and your hard work on behalf of our state and our nation’s future.

Warm personal regards,

Richard J. Roll

Founder and President

RJR:nm

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