Government bailouts are a problem, not the solution - Political Fever

Lumara · #1 (**permalink**) 11-25-2008, 08:26 AM

This piece was written by Joe Scarlett, a former CEO of Tractor Supply Co. I like the way he doesn't mince words and wrote the same sentiments that could have been written by Ron Paul or Peter Schiff. I especially like his opening paragraph:

Quote:

In the old days bank robbers went to jail. Today, the bankers and the robbers are one and the same, and they are being rewarded for incompetence with huge bags of extra money, courtesy of us taxpayers.

Hear hear! I'd like to see every Congressman who voted in favor of the bailout removed from office for corruption. They aren't even pretending to be working for the people anymore. This money will disappear and the taxpayers will be left holding the bag. This is just so WRONG!

Quote:

We have centuries of history that prove that markets don't go up forever. Bankers, more than almost any other group, should know this and if they do not, they should not be bankers. When bankers give mortgages to those who obviously can't repay, there is a serious shortage of basic common sense (or maybe just plain stupidity) as well as a lack of financial responsibility to stockholders and customers.

When you look at today's banking and real estate crisis, it is clear to even the least sophisticated among us that common sense has been lacking and basic ethics are out the window. Congress has now committed $700 billion to the very people who got us into this mess — a massive obligation belonging not to the politicians but to current and future taxpayers. Too late — it is a done deal.

Bankruptcy may help Big 3

Congress is now focused on bailing out the Big Three automakers who we all know have been on a downward spiral since the '70s or maybe earlier. The idea that GM, Ford and Chrysler would all of a sudden get smart after decades of being stupid is naive. It is conceivable that they might wake up after going through Chapter 11 bankruptcy, so let's give them that opportunity.

Suppose we do bail out the auto industry, then, what is next? How about the boat and yacht business, which I understand is now close to a standstill? And the homebuilders represent a huge portion of the economy and they are all in big trouble.

The restaurant business has been doing poorly since the spring and we certainly would not like to see our favorite spot close down. And then we don't want to forget all the retailers that are on the ropes.

Our free market capitalist economy is the envy of the world. There have been some excesses along the way, but our basic job- and wealth-creating machine is the best on the planet.

I have been in business all my life and never dreamt of any kind of government help. I figured that if we did the right things, worked hard and stayed in close touch with our customers, we would do well. And to the contrary, if we did not do well we would fail. That's business — let's not monkey with our principles.

We are at the top of a slippery slope that is leading us in the direction of socialism. Bailouts are a sickness; let's not get any sicker. Government bailouts are a problem, not the solution | www.tennessean.com | The Tennessean

Affrayer · #2 (**permalink**) 11-25-2008, 09:42 AM

Krugman: Citigroup Bailout Necessary, But Structured Outrageously

A bailout was necessary -- but this bailout is an outrage: a lousy deal for the taxpayers, no accountability for management, and just to make things perfect, quite possibly inadequate, so that Citi will be back for more.

In other words, it isn't the bailouts but those making the bailouts that are the problem.

Lumara · #3 (**permalink**) 11-25-2008, 10:11 AM

The bailout was not necessary. This is the final looting of the national treasury before the system collapses. The bailout will actually make things worse in the long run but the CEOs of the companies receiving bailout funds will be sitting pretty. This stinks!

Drakej · #4 (**permalink**) 11-25-2008, 10:53 AM

The bail out did not help the situation at all, it created more doubt in the market. There is nothing close to resembeling a plan. Money was handed out with no accountability or clear plan as to what is going to be done with the money. This makes Wallstreet very nevous, this has never happened before and people have no idea how to make a play on it. This is why we see the market go up and then tank again, people are trying to make as much money as possible right now. They are no longer looking at the long term.

Affrayer · #5 (**permalink**) 11-25-2008, 02:32 PM

Quote:

Originally Posted by Lumara

The bailout was not necessary.

The bailouts won't work. Your argument is that they are fundamentally wrong. Mine is that they are being applied in an incorrect manner.

Quote:

This is the final looting of the national treasury before the system collapses.

Certainly is working out that way. But before you jump to that conclusion, ask yourself who owned the most "toxic" mortgages? Who owned the banks? Who owns the auto companies. Who owned the majority shares in Citi-Group, AGI, and hundreds of other major corporations about to go belly up.

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The bailout will actually make things worse in the long run but the CEOs of the companies receiving bailout funds will be sitting pretty. This stinks!

Doesn't Bush deserve an "atta boy?" Let's all tip our hats to lassie fare economics that got us into this mess in the first place. As Bush loves to say, he's a free market kind of guy.

Affrayer · #6 (**permalink**) 11-25-2008, 02:35 PM

Quote:

Originally Posted by Drakej

This is why we see the market go up....

Nope, the reason you see the market go up is because that's where the bailout is going. Banks are taking the money and buying equity positions instead of shoring up their own shaky positions.

It's easy to track. Just date the release of billions of dollars by Paulson with the rise of the DOW Jones.

Skerlnik · #7 (**permalink**) 11-25-2008, 02:53 PM

Bailouts aren't the problem. Incredibly stupid, ineffective, unconditionalized bailouts given as gifts are the problem.

Zephyr · #8 (**permalink**) 11-25-2008, 03:53 PM

@ sker--Agreed.

Affrayer · #9 (**permalink**) 11-25-2008, 06:17 PM

Quote:

Originally Posted by Skerlnik

Bailouts aren't the problem. Incredibly stupid, ineffective, unconditionalized bailouts given as gifts are the problem.

Which makes the grilling congress gave the auto companies all the more laughable. Did they ask the CEO of Citigroup or AGI if they flew around in private jets?

Will this nonsense change when Obama takes office? Somehow I doubt it...

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