I hate to bail
Posted on September 22nd, 2008 at 11:09 am by East of EdenIn the words of Hillary Clinton, “Let’s have a conversation”. About what? The Wall Street bail out of course! Michael Reagan (son of Ronald Reagan) thinks the bail out is a “robbery” of the American people. I tend to agree with him, although I am the first to admit I do not understand all of the minutia that are driving the issue, but I understand enough to know that We The People are getting the fuzzy end of the lollipop in the deal.
What say you? Should the government bail out a private industry? Should the taxpayers be forced to pay more than they already are to keep the economy afloat on a life raft? Or should we let the chips fall where they may, go after the heads of companies a-la Enron and get some heads rolling, and suffer the economic consequences? Where do we draw the line as well? Do we bail out the big three automakers next? The airlines? How about Mom and Pop on Main street? Where do we stop? What is the best way to learn from our economic mistakes, and is it the fault of one party or the other, as Regan suggests?
From my vantage point on the couch, the people who are being forced to “learn from and pay for” these mistakes, are people who never made them in the first place – you and I; and the people who have made these mistakes should be suffering a bit more than they are. It seems like certain CEOs, heads of agencies, Secretaries of Departments and leaders in government, are walking away with fat wallets, wide smiles, and the idea that they have done the average person a favor with the bail out.
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Like I said in my post last week, the blame falls on everyone from the individual who applied for a loan they couldn’t afford to the banker who gave it to them, to the investment banks that traded on them, and finally to Congress, the White House, the Fed, and the Treasury for not regulating it.
Now, you and I may not have been one of those people who defaulted on a loan, but thanks to our neighbors who did, we’re going to pay for it.
I’m still going through the details on the bail out and haven’t had the time to study that I would have liked, but something had to be done. Until I educate myself on the details a little more, I’m not going to agree or disagree, but something had to be done. The very fundamentals of our financial system were turned upside down last week with the fall of Lehman and Merrill and the recategorization of Goldman and Morgan Stanley. Unfortunately, I think there comes a point when a business is too big to fail and all of these fall under that category. Letting all five IBanks would have totally devistated, not just our economy, but the entire world’s economy. I’m not sure what the right answer is to this, but I can assure you that something had to be done.
Not a bail-out kind of guy, but I accept them where the alternatives include widespread suffering of the general public (which we would have to address anyway) and/or chaos or national security issues. I see the case here for the bail-outs to avoid even worse things.
However, with the bail-outs, there must come indictments with no bail and solid changes in laws in order to correct the loop-holes which allowed this to happen.
I want revenge and reform in exchange for resolution.
Whodat loves to see bankers and lawyers slowly twisting in the wind