In brief: the failure of the bailout

[demiurgent]

It's surprisingly simple.

Neither major political party was willing to sacrifice the election to save the nation.

There is nothing more basic than that. Neither party would sacrifice personal power in order to save the economy of the United States of America.

My representative voted Nay. For the first time, I'm considering voting against her in November. I'm certainly calling her office tomorrow to express my deep disappointment in her.

For those who don't want to see the bailout of Wall street firms because gorsh, they's all rich and it's not fair? I hope you really, really enjoy the next ten years.

Comments

[bruceb.livejournal.com]

I agree. If we've learned anything from this administration, it should be "don't act until a large body of relevant information is available for public scrutiny". Businesses petitioning for relief need to explain what their needs are and why they know that.

[ed-dirt.livejournal.com]

I'm sorry, but I totally disagree with you. If action is not taken very very soon, there won't be anything left to save. The global economy is entering freefall.

[izzylobo.livejournal.com]

And the Evil Terrorists were going to Evily Terrorize us with Evil Terror - and so we got the Patriot Act, and warrant-less surveillance, and all the other happy horseshit that came along with it.

The economy is important. It's hurting - in part because now everyone has convinced themselves that if omfg the bill doesn't pass, the economy will implode - and it's important to do something.

But seven hundred billion dollars (or even the three-mumble hundred billion the current version of the bill provides for as immediately available) is a *lot* of money. It's money we don't have, on top of a hundred or so billion that we've already spent on this. And that doesn't count Iraq, or the current deficit, or anything else. This would be a huge sum of money even if the government hadn't been wastrels for the last 8 years.

And it's being given, potentially, to people who aren't very trustworthy. Paulson walked up to the Hill with a suggested bill that should have gotten him clapped in irons. The current version doesn't look much better.

Do the *right* thing - yes. Do something to stave off, sure - as long as it isn't a naked power grab, combined with the largest fleecing of the American public in history? You betcha.

But I'm not convinced this bill would work, that it wasn't a naked power grab, and that it wouldn't, in the long run, just be squeezing the last few drops of capital out of the public, before it all collapses anyways.

Sometimes, the cure really is worse than the disease.

[snowspinner.livejournal.com]

I mistrust public scrutiny in this case. Because public scrutiny means that my neighbors are making decisions about the global economy. My neighbors should not be doing that. My neighbors should be shutting up and listening to the smart people. They're welcome to pick which smart people to listen to, and to make principled judgments about courses of action, but really, I do not care if my neighbors think that the growing credit crisis is peaking and it's all going to be fine.

Unlike Iraq, the information here is not classified. Much of it is publicly available. You can see what the foreclosure rate is and what credit availability is.

There is also, among The Smart People (tm) much more visible consensus that this is super bad then there was that Iraq had WMDs - which was widely disputed and argued about in spring of 2003. That the financial markets are teetering on the brink of the worst disaster since 1929? Nobody's really arguing with that.

[roniliquidity.livejournal.com]

While there's a visible consensus that this is super bad, I'm not actually seeing a consensus that the sky is in fact falling and what we should do about it.

Most of the 'Smart people' that are adamant we are teetering on the brink of disaster and our best bet is to ram through legislation seem to fall into two categories; those that will most benefit from a huge bailout with no strings attached, or those that otherwise benefit from whipping up hysteria, such as the news channels that trade in fear mongering. There are plenty of Smart People that recognize there's a problem but don't advocate giving a massive amount of money with again, no oversight, to people that either caused this mess or didn't see it coming. It's bit of a red flag that Paulson or his people said that they need $50 billion, the other $650 is a number they came up with just in case. The House would have probably passed a lesser sum, but then there wouldn't be an emergency to leverage against a lack of safeguards.