The Orwellian language of Wall Street finds its way to the Treasury Department.

Daniel Gross:

In his timeless 1946 essay "Politics and the English Language," George Orwell condemned political rhetoric as a tool used "to make lies sound truthful" and "to give an appear­ance of solidity to pure wind." Were he alive today, Orwell might well be moved to pen a com­panion piece on the use of financial lingo. Remember those toxic assets? The poorly performing mortgages and collateralized debt obligations festering on the books of banks that made truly exe­crable lending decisions? In the latest federal bank rescue plan, they've been transformed into "legacy loans" and "lega­cy securities"--safe for professional in­vestors to purchase, provided, of course, they get lots of cheap government credit.

It's as if some thoughtful person had amassed, through decades of careful hus­bandry, a valuable collection that's now being left as a blessing for posterity. Using the word legacy to describe phenomena that are causing financial car­nage is "crazy," according to George Lakoff, a Berkeley professor of cognitive science and linguistics, because "legacy typically suggests something positive." More insidiously, the word is frequently deployed to deflect blame. Legacy finan­cial issues are, by definition, holdovers from prior regimes. Word sleuths advise me that legacy derives from an ancient In­do-Aryan root meaning, "It wasn't my fault, and I should still get a bonus this year even though we lost billions of dollars."

Posted by Jim Zellmer at April 6, 2009 6:01 AM
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