Bailout Bear Stearns, Fannie Mae and Freddie Mac, thanks George

It is looking more and more like the Chicago school free market economic policies of Milton Friedman are once again costing the Unites States it’s once cherished market dominance. The policies of the Republican Neo-Con administrations are on a one way ticket to destroy the American dream and the poor people who are not politically connected.

Unless you were born into or inherited enough money to weather the current economic storm you have been feeling the effects of Mr. Friedman and his cronies in the last few months. Billy Kristol of course could care less Friedman is still his idol as well as with the other moneyed and politically connected of his sect.

Friedman believed in almost no government intervention or regulation and that if left to it’s own means the market would correct for any irregularities. As it was posited by Friedman the market had it’s own equilibrium and would adjust and self correct as needed. As history has now shown again this is a severely myopic view with devastating consequences for the public at large.

While the government is only looking at a $300 billion dollar bailout or excuse me extension of credit which the American taxpayer is on the hook for a realistic loss of $30 billion with Fannie and Freddie, the free market does not seem to be correcting itself.

Lax banking standards coupled with lax investment house oversight are digging a hole deeper and deeper for the American taxpayer while the wealthy of this country are still making a killing. Even today with the financial mess that has been created the wealthy investment and banking houses are fighting any government oversight changes to protect the American populace.

The aggressive derivatives and mortgage markets coupled with the greed of banking executives hell bent on destroying the financial lives of it’s customers has brought us to this economic realization. The mortgage brokerages knew that the financial history of their client did not bode well yet they sold them into ARM hell and are now asking for bailouts from the government. Maybe now someone might think that the government should be a little more involved in regulating various industries.

Banks, investment houses and our rapidly deteriorating airline industry, wow this deregulation thing doesn’t seem to have worked out like we were told it would. But not to worry the after all the money has been bleed dry the government will bailout the banks after they destroyed hundreds of thousands of Americans of whatever dreams they may have had.

Yes it does cost money for the government to operate and sometimes they are not the most efficient entity to be found. But at least they will be consistent with their oversight and that is sorely needed right now and into the future. Deregulation was not the best of ideas and re-regulation is the pill we must take to correct for the wild west attitude now in place in the American economic system. The far right will cry no more taxes and Rush Limbaugh will crumble up his papers and yell into his microphone with his daily diatribe.

Well just remember that while we are in a war estimated to cost into the Trillion’s of dollars our President gave tax breaks to the ultra rich even as the dollar declined in value which has contributed to our current state of affairs.

There is little if any regulation in investment houses and mortgage companies with their get rich quick schemes that have sold us down the river for the foreseeable future.

I for one do not enjoy paying taxes either and would prefer the government wasn’t on my back however I will take the financial hit now rather than pay the price we are going to be paying even after I am gone. Rather than just thinking about yourself and screw the rest like the Neo-Con Republican mindset, why not look just a little further ahead and realize the government has to be engaged so that all Americans have a shot at the American Dream.

No you can’t put all of the blame on our current inept disengaged President it took some time to straighten out the lack of policy of the Reagan administration remember the S&L crisis when the leveraged buyouts and hostile takeovers were occuring right under his nose and he did nothing.

Well we finally got on the right track with Clinton in office who besides having some sexual endeavors in office was a great President.

Then came George who didn’t really get the government thing and he just did what his advisers told him to, well those advisers were from the Chicago school and look where we are now. Not to mention we did add fuel to the fire with a trumped up war and our illegal occupation of a couple of foreign nations.

So now the time has come for a change and hopefully we will not re-elect another Bush term under the guise of John McCain I for one don’t think this country can take four more years of failed policies.

So cry over your spilt milk eat some crow and digest some taxes so the dreaded government can step in and try to straighten out this mess again thanks to the Chicago school principles which have failed us again. It might not be what you wanted but at least the American public will get a fair shake even those without moneyed pasts and politically connected pasts.

So ask yourself do you care about your children and their future or do you only care about what is best for you and the rest of the nation be damned.

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One Response to Bailout Bear Stearns, Fannie Mae and Freddie Mac, thanks George

  1. libertaer says:

    “While the government is only looking at a $300 billion dollar bailout or excuse me extension of credit which the American taxpayer is on the hook for a realistic loss of $30 billion with Fannie and Freddie, the free market does not seem to be correcting itself.”

    Ah, no.

    Firstly, whereas Milton Friedman supported free markets with minimal intervention, he DID NOT support bailouts. That’s because bailouts constitute government intervention. So you can’t blame him for the ill-conceived course that today’s politicians have taken. Unfortunately, their actions will ensure that the free market does not produce a true remedy–why should it, if government can be expected to provide bailouts? Instead, we’ll get more ‘regulations’ and legislation (sponsored by the banking industry) that will funnel money into the pockets of bankers. Just wonderful :-/

    Secondly, Milton Friedman opposed the mechanism which enabled the bailout in the first place: The Federal Reserve. Realize that it was the Federal Reserve Act which enabled the Fed to provide Bear Stearns a loan to cover its bad investments. Again, Milton Friedman supported abolishment of the Federal Reserve or at least a major overhaul to make these types of bailout actions more difficult if not impossible.

    Thirdly, whereas you might rightly have a beef with Reaganism/Thatcherism, you can only attribute certain parts of Milton Friedman’s advice on the policies which ensued. For example, if you want to see what Milton Friedman supported regarding safety nets, then read the following. You’ll see that Reagan’s and Thatcher’s policies only vaguely resemble Friedman’s precepts.

    http://economistsview.typepad.com/economistsview/2006/11/milton_friedman_1.html

    Fortunately, today’s Democrats have gotten things back on track with the ‘stimulus payments,’ which everyone received in the mail. These can very concisely be traced back to Milton Friedman’s thinking. Hopefully they will become permanent and increase over time. Then maybe you won’t disparage a man who probably represented your interests far more than you realize.

    Best Regards
    Libertaer

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