The financial crash is not a "crisis of capitalism." It is the result of foolish federal policies manipulated by private interests -- precisely how Washington always operates. Giving Washington more power is no solution.

The federal government cannot eliminate financial losses and should not attempt to do so. It can only shift the burden -- in this case from irresponsible borrowers, lenders and investors -- to taxpayers. Keeping the walking dead on economic life support will only slow down necessary adjustments. The federal government's principal responsibility at a time of financial stress should be to maintain liquidity for use by otherwise sound institutions.

Congress certainly should reject an unrestricted, economy-wide purchase of mortgages and mortgage-backed securities, as well as "other financial instruments" at the Treasury's discretion. Interest groups already are lining up with their hands outstretched, including mortgage lenders and insurance companies, municipalities and foreign banks. The congressional Democrats even want to include home heating assistance and another wasteful "stimulus" package.

For the rest of the article:

Bob Barr: The 'Bailout From Hell' Must be Rejected


Agree, disagree? Frankly, I think the government should just let these companies fail and do something to insulate good investors (e.g. people with the retirement funds over which they really don't have much control with regard to where the money is invested; IRAs; home owners who pay their mortgages on time) from harm.

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A panda walks into a cafe. He orders a sandwich, eats it, then draws a gun and fires two shots in the air.

"Why?" asks the confused waiter, as the panda makes toward the exit. The panda produces a badly punctuated wildlife manual and tosses it over his shoulder.

"I'm a panda," he says at the door. "Look it up."

The waiter turns to the relevant entry and, sure enough, finds an explanation.

"Panda. Large black-and-white bear-like mammal, native to China. Eats, shoots and leaves."

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Defeating market theocrats since 2001.

My current opinion on this is that we have a system where the responsible decision-makers, that is the CEOs, CFOs, Board Members of these companies and industries have the economy in a headlock. There are no personal liability for running a company/industry into the ground irresponsibly.

It'll never happen, of course, but probably the best way to "fix" this is to treat it kid of like a personal bankruptcy. Strip the assets, especially all the management salaries and whatnot, and tie legal liability into performance, somehow. Leave these guiys open to having their houses and cars and assets taken, and left with just the basics that you are left with after a bankruptcy, and that instills an element of real risk. As it stands now, these guys don't care one bit about the economy or what the fallout of failure is, because other people have to absorb it.

Working on the assumption that the gov can figure out how to watchdog anymore, some simple liability legislation might force these megacorps to "self-regulate" in their best interest. But, that's why the con-game of the Limited Liability Corporation was invented, so they could be as reckless as they wished, at no risk to themselves.

This $700 billion bailout is essentially a reward for irresponsible behavior. It won't allow any lessons to be learned, whatsoever. Unfortunately, with no attendant tie to personal risk for these industries and their leadership.......

Am I wrong here?

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An employee gets trampled to death by a frenzied, greedy mob at a Walmart sale, and customers actually complained when the store closed. Yet, I'm the bad guy for suggesting policies that assume people act like retarded herd animals that need government nannying and control....

Worse, when they do run their companies into the ground their boards reward them with multi-million dollar bonuses.

Quote:

It'll never happen, of course, but probably the best way to "fix" this is to treat it kid of like a personal bankruptcy. Strip the assets, especially all the management salaries and whatnot, and tie legal liability into performance, somehow. Leave these guiys open to having their houses and cars and assets taken, and left with just the basics that you are left with after a bankruptcy, and that instills an element of real risk. As it stands now, these guys don't care one bit about the economy or what the fallout of failure is, because other people have to absorb it.

Interesting. I'm not sure that's how it works in a corporate bankruptcy and there may be some problems with going after these "employees'" private assets to pay the company's debts (though maybe it's not such a bad idea).

See, the problem here isn't the free market, it's the government. The free market would never have allowed the existence of limited liability corporations. Also, the market would regulate these companies by letting those companies fail that make these kinds of really bad business decisions.

And I'm amazed that it's the liberals who seem to be pushing so hard for this (of course, if Paulson has his way then it would mean unfettered government control over the economy) - a liberal's wet dream.

Not necessarily.

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A panda walks into a cafe. He orders a sandwich, eats it, then draws a gun and fires two shots in the air.

"Why?" asks the confused waiter, as the panda makes toward the exit. The panda produces a badly punctuated wildlife manual and tosses it over his shoulder.

"I'm a panda," he says at the door. "Look it up."

The waiter turns to the relevant entry and, sure enough, finds an explanation.

"Panda. Large black-and-white bear-like mammal, native to China. Eats, shoots and leaves."

That's just it. I have no problem at all with these sorts of rewards when a corportation is run well. That just makes sense. But, using the assumption that better decisions are made when there is a personal stake, an element of risk involved, I'd love to see these corporate mercenaries lose big, personally....their workers and clients sure do, when the companiy fails.

Like I said, though, it would never happen, but that's the sort of regulation I would support.

(So, Chan, regulation simply for regulation's sake is stupid, I agree. It needs to be effective, simple and intelligent.)

Just an idea. It really speaks to the notions of fair play and responsibility most people have. It doesn't restrict anything, just might force some better accountability.

I am not a real big believer in allowing the foxes to guard their own chicken coops, and I think we're seeing exactly what happens when there is no accountability. Had the government been awake and done their jobs, and had the intelligence to see the train wreck coming, this should have been avoided.

Yes, government is certainly part of the problem, having chosen to be buddy-buddy with corporate lobbyists, instead of holding a responsible leash on behalf of the people.

Government didn't do it's job. But, I think you're mistaken that this never would have happened under a free market. I think this would happen every day.

You have a gift for exaggeration, my friend.

Any semblance of temprary "control" over these critical financial industries will be temporary at best, just enough to right the ship.

Lack of oversight and control is the very crux of the problem...less oversight and accountability is not the solution.

Chan, you are a parent. Did you allow your daughter to run completely wild and able to do as she pleased, or did you provide boundaries and structure? Did you teach her right from wrong and that actions have consequences? Of course you did. I see government's role in that same way.

These megacorps and market players are inherently critical to the economic health of the nation. To not take national responsibility for them is reckless and unconscionable, as we are seeing right now. If we had our crap together and had more of a firm, moderating hand, this wouldn't be as painful as it is now.

I agree that they don't deserve a bailout. But, considering the costs of NOT bailing them out is probably worse, I'd like to see this bailout at least come with some severe changes......HUGE strings attached, so to speak.

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An employee gets trampled to death by a frenzied, greedy mob at a Walmart sale, and customers actually complained when the store closed. Yet, I'm the bad guy for suggesting policies that assume people act like retarded herd animals that need government nannying and control....

i agree. no details, our tax money, not to mention to guarantee it will work. the govt has already bailed out banks and pumped money into the system. look where we are

we will spend the money, and in 6 months be right back in the same situation. these companies should not be rewarded, and the execs should CERTAINLY not be rewarded fo their greed which got us in this situation

My idea: put those responsible in jail and seize their assets, including what they have overseas. Seize all assets of the failed companies, including what they have overseas. Sell their buildings and assets to the highest bidders and apply any money raised to the pension plans most affected by this.

Put the government on an austerity program so that only those programs necessary to running the government will continue to be funded. You can't just throw a majority of government workers on the street so a gradual phaseout would have to be done. Close the hundreds of military bases overseas. End foreign aid as well as the Iraq war. End all corporate welfare and bailouts. Set a deadline for social welfare programs to end or be greatly reduced so that people in these programs can have time to make other plans.

Eliminate the influence of the Federal Reserve which is just a big scam. Return to the gold standard which would have prevented the current fiasco if it hadn't been discarded.

Do NOT reward greed by throwing more money at it. Do NOT use tax money to bail anyone out. Do not print extra money to increase inflation.

Just brainstorming here.

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Walter Mondale: "George Bush doesn't have the manhood to apologize." George Bush: "Well, on the manhood thing, I'll put mine up against his any time."

What other plans? Die? Go live in a hovel? A workhouse/prison? The social programmes, or at least several of them, are a necessity.

It is unlikely that a Gold standard would have done much of anything either. Contrary to what many think, Gold is not intrinsically valuable. It has hypothetical value in at least two ways: industry use and "ooo shiney!" People have faith in the value of Gold as much as they have faith in the value of the cotton paper we print. Gold can fluctuate up and down in price. It's not terribly stable either as a backing.

Another problem is that it is vulnerable to influxes of Gold as well as the limitations of accessible deposits. The economy is far too large for the relatively small quantity of Gold that is available, which would lead to serious economic problems anyway of not having enough to accurately represent the size or productivity of the economy. In fact, Gold in the past never even stopped the printing of paper money when it was needed: they did it anyway because there simply wasn't enough cash capital to go around for the needs, size of the economy.

This is one reason why it was abandoned. Gold Standards can also help create serious deflation.

Fiat paper isn't going to go anywhere, and I don't see how it's practical without devastating economies. It certainly has some serious flaws. It's not ideal.


Foreign aid could be eliminated, but it would:

A. Hurt US image abroad and increase suffering
B. Not really do much to help the deficit, given the raw funding is relatively small. It's like pissing on a fire.

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No, social programs are not a necessity.

Is there anything that is "intrinsically valuable"? Tying currency to something tangible like gold or other precious metals makes the currency more stable and fairly consistent - not like fiat currency that has nothing to back it up except the "good faith and credit" of the government that prints it.

The economy could stand to be shrunk a little. And of course there is only a limited supply of gold and other commodities (that could be used to back up the currency) and that's part of what helps the currency retain a relatively consistent value.

Which you apparently think is worse than inflation? The more fiat money you print, the less valuable it is and the more inflation you have as the currency itself continues to deflate in value.

Economies wouldn't necessarily be devastated and where devastation might occur (in the area of government control), the world could use a little devastation.


What hurts the US image abroad is interfering in the internal affairs of other countries. As for increasing suffering, there are plenty of charitable organizations out there. You're a damned idiot if you think just throwing money at some cholera-ridden third world rat hole is going to alleviate suffering! After several decades of America and Europe throwing money at Africa, Africa is still suffering.
The only thing that will help the deficit is to cut spending.

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A panda walks into a cafe. He orders a sandwich, eats it, then draws a gun and fires two shots in the air.

"Why?" asks the confused waiter, as the panda makes toward the exit. The panda produces a badly punctuated wildlife manual and tosses it over his shoulder.

"I'm a panda," he says at the door. "Look it up."

The waiter turns to the relevant entry and, sure enough, finds an explanation.

"Panda. Large black-and-white bear-like mammal, native to China. Eats, shoots and leaves."