Wednesday, September 24, 2008

Just Say No

I haven't really written too much about the proposed Wall Street Bailout as of yet, mainly because the story is still rapidly developing and changing. But here is one thing that I can say for certain: Congress has no business adopting such a plan.

When it comes down to brass tacks, what is the government underwriting of $700 billion worth of bad decisions really going to get for the American people? Not much, other than a higher deficit and a possible risk to the liquidity of the U.S. Government. The last thing we need during a time period where we are already spending more than the government can afford is such an expansion of our national debt. It's an expansion of government involvement in the economy, something that was we have seen over the years (hello Sarbanes-Oxley) generally creates new problems while exacerbating existing ones.

What's even more ridiculous about the concept is the fact that the same people who got us into the mess are the same people who seem to think that they can find us a way out of it. As Ron Smith wrote in the Sun this morning:

Why is it we are supposed to believe that the same "experts" who led us down the path to financial ruin are capable of constructing strategies, policies and bailouts that will turn us around and head us toward solvency? It makes no sense. We are assured that Federal Reserve Chairman Ben S. Bernanke is on top of things because he won his spurs as a scholar of the Great Depression. This isn't a replay of the 1930s, though; it's something new, something perhaps even bigger.
If Congress chooses to not pass a bailout, there is no question that it would destabilize the economy both here and abroad. I think that no reasonable person would disagree with that. But it is entirely possibly, dare I say likely, that the results of the bailout will be far far worse for the economy and the American taxpayer than by letting things take their course.

We saw during the 1930's what overzealous government intervention brought in the form of the New Deal, which sunk the American economy deeper and deeper into the Depression and created the Entitlement State that so burdens middle and working class taxpayers to this day. The last thing we need today are such regulations and reforms to make this situation worse.

Congress needs to take a step back and just so no to this bailout. Our future depends on it.

(Crossposted)

22 comments:

Milititant Liberal said...

The free market needs to suffer , the reagan economic test is over and it is a failure.

Let's get on with sustainable wealth for the masses.


and drain every sent form the CEO. CFO and all the other O's responsible for their companies' demise.

lay the blem on the people at the top and make them pay for it.

Milititant Liberal said...

The free market needs to suffer , the reagan economic test is over and it is a failure.

Let's get on with sustainable wealth for the masses.


and drain every sent form the CEO. CFO and all the other O's responsible for their companies' demise.

lay the BLAM on the people at the top and make them pay for it.

militant liberal said...

BLAME

Bruce Godfrey said...

With you on this. So are the sharpest, severest voices among the liberals at Daily Kos, inter alia.

Daniel said...

Remember, one recent Rasmussen poll indicated just a 7% approval rating for the bailout.


Of course, meaning that 93% percent of us don't want the bailout.

warpmine said...

There's not much incentive to answer a hack with a name like "militant liberal" now is there?

Of course Clinton forced the affirmative action lending practices upon us all and now we get to pay the piper or drown in government debt.

Barney Frank was on Lou Dobbs tonight and as expected just ran at the mouth blaming others for the disaster that he and his friends helped to create. He suggested that congress was unable to perform oversight because no one was qualified. I respond by exclaiming get out of the way permanently. Retire with haste, go and do whatever queers do when they retire from
"F-ing up everything.

Mister D. said...
This comment has been removed by the author.
Mister D. said...

"Let's get on with sustainable wealth for the masses."


Let's get on with proper spelling and a firm grasp of the english language from the asses.

Anonymous said...

unfortunately, we have to see what will be worse, bail out or no bail out. there has to be a serous discussion. It scares me that they tried to push it through congress so quickly, what are they hiding?? It shows that greed and our current gov(democrats and republicans)were responsible. It is sadder that barack has one of the leaders of this debacle as an economic advisor. Wake up america, you have been following pop culture, reality tv, and have worked your life away to have a future stolen from us and our children...

Don't mess with Mensa said...

Oy Vey

McCain wimps out on the debate because he knows he will lose.

He is posturing, holding up a diversion to once again steal the limelight not with substance but with sophistry. Like the legs of Palin, whom he does not allow to speak, this latest attempt to change the focus on him will not work.

The Great American people are not fooled by McCains poker bluffs, and Obama will be seen as the one who seriously considers the job before him.
Obama will explain--not avoid explaining-- what should be done to right the ship of state as it is navigated away from the turbulent seas that resulted for a broken fee market economy.

Obama knows he is still being interviewed for his next job and does not pretend that HIS arrival into Washington will add anything to the national dialogue at this time.

The Debate must and will go on. McCain will not allowed to dictate orders to Obama. Obama is not McCain's subservient follower.

So my Friends : ) , in this time of great import, I ask that you not feed this political
performance by McCain and demand he serve the greater good at this time. Insist that McCain stop bluffing and show his cards. Explain to the America Patriots his plans to correct the broken parts of the great experiment that is amerika.

The Great American People deserve no less.

I am Somebody, and I approve this message

PonyHawk said...

The problem I have with Brian's opinion is that you can tell he doesn't understand what the bailout package is. He just is against it because it is government spending tax dollars. Especially because he compares it to Sarbanes-Oxley.

I think I'm starting to come around on some of the principles in Sarbanes-Oxley and am shifting from free-marketeer, to someone that thinks we need some regulation and structure in government. Just like with de-regulating electricity markets in Maryland, the deregulation of Wall Street and of these Government Sponsored Enterprises seems to have been a complete failure.

AnotherWatcher said...

Here is a little of why the housing market crashed.
http://www.ombwatch.org/article/articleview/3133

"On February 16, Senator Barack Obama☼ (D-IL) introduced S. 2319, the Hurricane Recovery Act of 2006. The bill includes, among other things, language that would establish an Affordable Housing Fund with a percentage of Fannie Mae and Freddie Mac’s profits."

AnotherWatcher said...

"the reagan economic test is over and it is a failure. "

Another MENSA member I am sure.

lefty said...

Gee, Brian, up until the last paragraph trashing the New Deal, I was completely in agreement with you. Who'd a thunk it?

So, being the argumentative cuss that I am, let's talk about where we disagree. The New Deal regulatory regime worked very well for 60 years. From 1947 to the mid-1970s, this country experienced its greatest period of sustained growth ever. And it was the New Deal system that was the basis of that growth.

Beginning in the 1990s, however, there was intense pressure from Wall Street and elsewhere to loosen these regulatory restrictions. So a lot of them were done away with in the name of "modernization" and "efficiency." Translation: we need to make more @%@#% money, and these regulations are in our way.

It is precisely that systematic weakening of the New Deal system of regulation that has brought us to this point. When people talk about beefing up regulation, the irony is thicker than mud.

While we can argue about this vote or that vote, the impetus for the dismantling of the financial regulations initially created in the 1930s came from the Republican Congress. Yes, yes, a lot of Democrats voted for it, and yes, yes, Bill Clinton went along with it, and yes, yes, some Democrats got rich too. Spare me.

But the philosophical underpinning of deregulation is a purely Republican and conservative idea. And your complaining about the New Deal regulatory system is emblematic of that. When markets were more appropriately regulated, we didn't have bailouts, and we had sustained growth. Now we have unbridled runaway financial speculation, and you are shocked, shocked to find out that there has been abuse of the system. Wake up.

So, what do you propose instead? Unfettered free market capitalism? We haven't had that since the 1920s, and look how that turned out. You, or one of your buddies here, wrote a little while back about how Keynes was dead as an economic prophet. Well, guess what? He's been resurrected, and he's really, really pissed. See here for the details.

So yes, I agree with you that this bailout is a bad idea. I agree that some of these firms should be allowed to fail, and that the cure of the bailout may be worse than the disease. But that doesn't answer the question of what to do going forward.

Your answer, presumably, is to deregulate further. But that's what brought us to this point. I believe that a modernized and reinvigorated regulatory system can and will both create the conditions for economic growth and avoid the excesses of the past two decades.

A Life Well Lived said...

Anotherwatcher,

Yea, that's it. Creating affordable housing for more people to get a house crashed the entire housing market.

Are you trying to put lipstick on your pig or do you think people will actually be fooled?

warpmine said...

Even Clinton stated that he knew there was a problem with Fannie and Freddie and said as much on Good Morning America. Sen. If you listen to what they said in the past it will be totally contradictory to what their saying now. Barney Frank said five years ago that Bush and the GOP was using scare tactics to get reforms. Frank objected to them, Dodd blocked them and now we have the bomb that's gone off.

Come to think of it Frank's former "lover" worked for Freddie before going to work in a craft store. Never mind!

DO you think "the One" will add something credible to the discussion at the WH. I seriously doubt it considering he hasn't given the voters any details of his "Change, We Need" campaign.

Mark Newgent said...

Yes ALWL,

That is indeed what happened. The Clinton administration injected steroids into the well intentioned Carter era Community Reinvestment Act. The CRA was supposed to foster home ownership in distressed urban areas. Clinton came in with sweeping mandates politicizing lending practices and forcing mortgage banks to loosen standards lend money to people who could not afford to pay back the loans. More specifically the Clinton administration forced banks to loan money to minorities and to prove that they were'nt redlining poor minorities. The banks passed on the loans to Fannie and Freddie (i.e. Obama's advisors Raines and Johnson). In 2005 the Bush administration actually tried to reform Fannie and Freddie but Barney Frank and Chris Dodd who suppped on the GSE's largesse, along with Obama, blocked the reforms.

Speaking of Obama and Katrina. While he is castigating Palin for her stance on the bridge to nowhere. Obama voted for the bridge even when given the chance to shift part of its budget to Katrina relief.

Next time do yourself the favor of actually knowing what you are talking about.

Geneva Cohen said...

Why is our ex- Lt Governor an authority on all things McCain? Is he trying to Uncle Tom his way into a high ranking cabinet post (should McCain miraculously win), or does Fox just need a token negroid talking head ?

He really adds nothing objective or insightful; he comes across as a paid surrogate.

I don't see any other Ex-Lt gov or Senate race losers being put forth as 'authorities.

AnotherWatcher said...

And now the bright mind of Senator Dodd want to throw another $100 MILLION to the ACORN fascist group.
what a wonderful idea Dodd. More money for a group that helped CAUSE this mess.

AnotherWatcher said...

Geneva Cohen is showing her racist roots. It is amazing how one "negroid" can twist the panties of another "negroid" for the sole reason that she disagrees with him.

The old racism of the Democrats is showing its ugly head again just as it did when the Republicans pushed the Civil Rights Laws.

Geneva Cohen said...

I forgot he is not just a token negroid talking head, he is of a rarer breed: token negro-conservative talking head.

Also , I am not a democrat, I am an independent with conservative leanings.


BTW seems Obama won the debate standoff game.

I am willing to bet 1000 dollars Obama wins.

Mister D. said...

"I am willing to bet 1000 dollars Obama wins"


Well now.That's a suckers bet now,isn't it?

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